Negligence case against Davy Stockbrokers settled

A claim Davy Stockbrokers was negligent in advising a businessman to sell investment bonds for around €5.58m which he alleged was at a significant undervalue has been settled, the Commercial Court has heard.

Patrick Kearney and Kilmona Holdings Ltd brought proceedings against J&E Davy, trading as Davy, over advice the stockbrokers allegedly gave in 2014 on the sale of 27m Anglo Irish Bank callable subordinated floating bonds.

The case was admitted to the Commercial Court list last October on consent between the parties.

Yesterday, Mr Justice John Hedigan was informed by Andrew Fitzpatrick, for the plaintiffs, that the matter had been settled.

In his action, Mr Kearney, who lives in Queensway Quay, Gibralter, claimed he and a company called Pattan SL were advanced a loan for €18.4m by the former Anglo Irish Bank in 2009 to buy the bonds.

Anglo’s successor, IBRC, later assigned the benefit of the loans to a company called Stapleford Finance Ltd.

In 2014, Mr Kearney said he engaged LeBruin Private Ltd to advise him on how to deal with his debt obligations to Stapleford.

Following discussions involving Mr Kearney, LeBruin and Tony O’Connor, who Mr Kearney alleged was an employee of Davy, it was decided Davy would sell the bonds for a price which would discharge the €2.36m debt to Stapleford and leave a profit which would be divided between him, LeBruin and Davy.

The bonds were sold for 20.25 cent in the euro, realising a total price of around €5.58m.

Mr Kearney claimed the price represented by Davy was below their market value and Davy failed to disclose the conflict between his interests and theirs.