High Court dismisses Ezeon challenge to shareholder's insolvency deal

In his judgment, Mr Justice Alexander Owens said Ezeon sought to set aside a Circuit Court order “in a manner unknown to law”. 

Ezeon Entertainment Ltd wanted the High Court to set aside its order made in July 2022 where an appeal brought by businessman Michael O’Flynn (pictured) against a Circuit Court decision approving Mr O’Driscoll’s PIA was dismissed. File picture: Larry Cummins

A High Court judge has dismissed a challenge by a company whose shareholders include rugby star Ronan O'Gara and businessman Michael O'Flynn to an order relating to the personal insolvency arrangement in favour of fellow shareholder John O'Driscoll.

The application was regarded as a new bid to set aside the PIA and seek a new hearing. Ezeon Entertainment Ltd wanted the High Court to set aside its order made in July 2022 where an appeal brought by businessman Michael O’Flynn against a Circuit Court decision approving Mr O’Driscoll’s PIA was dismissed.

Ezeon Entertainment Limited purchased a Cork-based pub called 'The Silly Goose' in 2007. Mr O'Gara, Mr O'Flynn and Mr O'Driscoll who are known to each other were equal shareholders in the venture, which was funded by loans from Anglo Irish Bank.

Ezeon claimed the alleged misappropriation of a total of €15,725 in company funds allegedly by Mr O'Driscoll at different times in 2019. Mr O’Driscoll strenuously denied all such claims.

In his judgment, Mr Justice Alexander Owens said Mr O’Driscoll had paid and Ezeon received €15,725. Ezeon, he said, sought to set aside a Circuit Court order “in a manner unknown to law”. 

Earlier, opposing the application Counsel Bernard Dunleavy SC for the personal insolvency practitioner told the court the application was “utterly irregular and unknown to the court”. Counsel said it “was intimately bound up with Mr O’Flynn’s unsuccessful application to the court” where he sought last July to appeal the Circuit Court order approving the PIA.

On that occasion Mr O’Flynn, who sought to overturn the PIA over an alleged debt owed to him, was prevented from doing so after the High Court found he lacked legal standing to do so.

Mr Dunleavy on Monday told Mr Justice Owens, who was deciding on a preliminary issue whether he had jurisdiction to hear the application, “they are trying to come in to court cloaked under the O’Flynn appeal”. Counsel said the effect of the first relief sought in the application to set aside the High Court dismissal order would put “Mr O’Flynn back before the court”. 

He said “Mr O’Flynn will then retake the ring”. Moving the application, Counsel for Ezeon, Martin Hayden SC with Keith Farry BL, submitted that the O’Driscoll PIA process was “operated at a level and speed which is extraordinary”. He added it had been signed off over a bank holiday weekend in March 2022.

“The whole exercise is getting it over the line where it can’t be challenged,” Mr Hayden said. Counsel said the decision of the court in this case will have an “impact on the entire insolvency system”. Mr Hayden said Ezeon wanted the order set aside and there to be a hearing.

“It’s nothing to do with Mr O’Flynn,” Counsel added.

Mr Justice Owens granted costs against Ezeon but put a stay on the order for two months in the event of an appeal. Mr O'Flynn’s appeal against the dismissal of his own challenge against the PIA, heard by the Supreme Court, will go ahead in June.

In a sworn statement, Mr O'Driscoll denied all the claims against him and says that at no point did he misappropriate the money as alleged or that he had done anything improper.

Previously the court heard that in 2014 Mr O'Flynn took over the borrowings and refinanced Ezeon for €2.2m, which had risen to €2.5m by 2018. Arising out of that debt it is alleged that Mr O'Driscoll, from Ovens in Cork, owes at least €950,000 to Mr O'Flynn.