Dunne loses bid to set aside Irish bankruptcy

Developer Seán Dunne has lost his Supreme Court bid to set aside his bankruptcy arising from default on loans of some €164m issued to buy properties in Dublin.

Sat, 16 May, 2015 - 01:00

Aodhan O’Faolain

A three-judge Supreme Court rejected claims by the now US-based developer his July 2013 adjudication of bankruptcy by the Irish High Court cannot stand on grounds including his having previously filed for bankruptcy in the US. Irish bankruptcy laws, he argued, do not allow for a double or dual bankruptcy findings in different jurisdictions.

Ulster Bank and Nama, Mr Dunne’s largest creditor, opposed his appeal and argued that the Irish adjudication should remain undisturbed.

Ulster Bank had petitioned in February 2013 to have Mr Dunne adjudicated bankrupt here over default on loans of some €164m. The following month, Mr Dunne filed for bankruptcy in Connecticut, when he claimed to have debts of $1bn (€873m) and assets of $55m. In July 2013, he was adjudicated bankrupt in Ireland. When the High Court refused in December 2013 to set aside that adjudication, Mr Dunne appealed to the Supreme Court.

Giving the Supreme Court judgment, Ms Justice Mary Laffoy, with whom the Chief Justice, Ms Justice Susan Denham, and Mr Justice Peter Charleton agreed, said the appeal raised “a fundamental question” about the operation of Irish law on bankruptcy, meaning personal insolvency as distinct from corporate insolvency. It was surprising there was no record of the principal issue raised by Mr Dunne in this appeal, having been previously addressed by the Irish courts, she added.

The judge rejected Mr Dunne’s core argument the High Court had no jurisdiction to make the bankruptcy adjudication order in the context of Mr Dunne having initiated bankruptcy proceedings in the US prior to the Irish adjudication.

The High Court had jurisdiction, when it heard the petition on July 29 2013, to make an order adjudicating Mr Dunne bankrupt notwithstanding the pre-existence of the Chapter 7 proceedings in the US bankruptcy court, the judge said.

She also dismissed Mr Dunne’s claim the adjudication order was obtained in breach of Mr Dunne’s procedural rights, particularly his right to notice, including statutory notice, of the proceedings.