Elderly couple’s loss of €1.25m savings a ‘Celtic Tiger tragedy’

An elderly couple who lost their entire life savings in a failed investment were granted judgment for €1.25m in the High Court.

Mr Justice Nicholas Kearns, said the case of Teresa Dillon, 84, and her husband Patrick, who is deceased, could only be described as a “Celtic Tiger tragedy”.

The Dillions, of Gort Na Mona Drive, Foxrock, Dublin, lost their life savings after €1.25m was invested and became, as the judge described, “utterly worthless”.

Mr Justice Kearns granted the judgment plus interest against auditor and accountant, Paschal Bergin, of Bergin and Associates, Village Craft Centre, Foxrock, Dublin; Patrick Muldowney a financial adviser who practised under the trading name, Muldowney Financial Services, Largo House, Rathmines Road Lower, Dublin, and Event Horizon Ltd, a property development firm with offices at Ulysses House, Foley Street, Dublin.

The judge said he had no hesitation in holding Mr Bergin and Mr Muldowney negligent.

He said he did not believe it was a deliberate attempt to defraud, but it was negligence of a high order and beyond contradiction. He said it would not be just or appropriate to apportion contributory negligence to a couple in their 80s who had long since retired and wanted to live out their days in some degree of security.

The Dillons had brought the proceedings for the return of the €1.25m investment lost after a housing development in the Midlands failed.

The judge said the couple had been successful in business and had invested stg£960,000 in an Isle of Man account which was due to mature at the end of 2006. They had forgotten where they invested the money and Mr Bergin had helped them recover it from the account.

In the proceedings, it was claimed Mr Bergin advised that the couple’s funds be invested through an entity described as “Muldowney Financial”, where the return was stated as being 15% over two years and where the capital and return were guaranteed and secure.

In a letter to the Dillons, it was claimed Mr Bergin said another comfort he could give them was that he had personally invested with Muldowney Financial and referred a number of people to them.

Mr Bergin denied he had acted as a financial adviser. He said he had no involvement in the further investment made by the Dillons.

The Dillons, it was claimed, were introduced to Mr Muldowney in Mr Bergin’s offices in Jan 2007. Mr Muldowney, it was claimed, advised them to invest in property development firm, Event Horizon Ltd.

They invested €1.25m and got a share certificate. Mr Muldowney denied he offered any financial advice and his sole involvement was to collect the cheque from them, lodge it and issue a share certificate.

It was claimed as a result of alleged negligence, the Dillons suffered the loss of the €1.25m along with the amount of the guaranteed return on the investment along with considerable stress and anxiety.

It was claimed it was a term of the arrangement with the defendants that they would exercise reasonable care and skill.

Mr Justice Kearns said Mrs Dillon had been a totally credible witness who had great difficulty in coming to terms with the loss of the investment. Her husband had died soon after the events occurred.

The judge said he was satisfied Mr Bergin had steered the Dillons towards investing in Event Horizon and there was a close connection with Event Horizon, but the Dillons were given no information on this.

He said Mr Bergin and Mr Muldowney had tried to wash their hands of it by blaming each other.