Transfer of Drumm home to wife overturned

A HIGH Court judge has made formal orders overturning the controversial transfer by former Anglo Irish Bank chief executive David Drumm of his half share of his former family home at Malahide, Co Dublin, into the sole ownership of his wife.

In proceedings against Mr Drumm and his wife Lorraine, Anglo sought to overturn the May 2009 transfer of ownership of the property at Abington, Malahide, arguing it was a fraud on creditors while the Drumms insisted it was for taxation reasons.

After several court hearings, Ms Drumm last month gave an irrevocable consent to the transfer being quashed and the property reverting into the joint ownership of the couple, meaning applications could be made to have Mr Drumm’s share of the property realised for the benefit of his creditors. The property has been valued at €1.2 million.

However, no formal order could be made in the case arising from Mr Drumm having filed for voluntary bankruptcy in the US last October, just days before proceedings were due to be heard against him and his wife in the Commercial Court.

After Ms Justice Elizabeth Dunne granted High Court orders providing for the Irish courts to assist the US trustee, Kathleen Dwyer, in administering Mr Drumm’s bankruptcy and vesting ownership of the Abington property in the trustee, the cases against the Drumms came back before the Commercial Court yesterday.

Mr Justice Peter Kelly, after hearing from Bernard Dunleavy, for the trustee, made an order setting aside abinito (from the beginning or as if it had never happened) the May 2009 transfer of the property from the joint ownership of David and Lorraine Drumm into the sole name of Ms Drumm.

He also continued an order restraining Ms Drumm from any dealings in relation to the Abington property pending the lodging of appropriate documents concerning the property with the Property Registration Authority so as to give effect to the orders of Ms Justice Dunne. Once those documents are lodged, the order should be lifted, he directed.

Anglo’s action against Mr Drumm over €8m in unpaid loans, and his counterclaim for €2.6m remains outstanding.

When the judge asked about the US trustee’s attitude to those proceedings, Mr Dunleavy said she takes the view that both the bank’s claim and Mr Drumm’s counterclaim should be dealt with in the US bankruptcy and wasn’t proposing to get involved in proceedings here.

Paul Sreenan, for Anglo, said he wanted to adjourn those proceedings.

The judge adjourned the matter to February 22.