ANOTHER TRAVESTY. DOES THE COMMITMENT THAT IBRC GAVE PRIOR TO CHARLTON RULING THAT THEY WOULD ACCEPT WHATEVER DECISION HE MADE AND WOULD NOT APPEAL IT, MEAN NOTHING. BANANA REPUBLIC THAT WE ARE PAYING FOR. HOW LOW CAN THESE PEOPLE STOOP TO TRY TO FINISH OFF THE QUINNS?

IBRC entitled to proceed with Quinn appeal

Supreme Court says IBRC can appeal High Court decision on Quinn claims.

The Supreme Court has ruled IBRC is entitled to proceed with a preliminary appeal against a significant High Court decision allowing Seán Quinn’s family litigate claims the former Anglo Irish Bank unlawfully “shovelled” € 2.34bn loans into Quinn companies to shore up its plummeting share price.

Mrs Patricia Quinn and her five children had argued the special liquidators of IBRC (formerly Anglo) were not entitled to appeal that February 2012 decision of Mr Justice Peter Charleton until after their main action denying liability for the loans was heard.

Today, a three judge Supreme Court ruled there was nothing to prevent IBRC appealing Mr Justice Charleton’s decision prior to that full hearing.

Giving the court’s ruling, Mr Justice Nial Fennelly said there was no basis to arguments made on behalf of the Quinns that the High Court could, at any stage, have imposed any restriction on the timing of the appeal.

He also found Mr Justice Peter Kelly, when dealing with issues in the Commercial Court litigation, had not placed any restrictions on the bank’s right to appeal. While Mr Justice Kelly had referred to a “modular” hearing, it was clear the judge was deciding a specific point should be decided as a preliminary issue of law in advance of the trial, he added.

In their main action, the Quinns claim Anglo illegally made € 2.34bn loans from September 2007 to fund margin calls on Contract for Difference positions built up by Seán Quinn senior in Anglo from 2005 through a Madeira-registered company, Bazzely, owned by the Quinn children.

In February 2012, Mr Justice Charleton ruled the Quinns may, in their action, litigate claims the loans breached Section 60 of the Companies Act and the Market Abuse Regulations.

IBRC had argued the Quinns should not be allowed make those claims but Mr Justice Peter Charleton in February 2012 said it would be contrary to public policy to shut out the Quinns from responding to the “flagrant illegality” alleged against Anglo and Seán Quinn.

He ruled the family are entitled to advance claims they can avoid liability for loans if they prove those loans were made for “wholesale” market manipulation in breach of Irish and European law.

He added there may be a portion of “legitimate debt” involved, a reference to the bank’s claim that € 500m loans are unrelated to the allegedly unlawful loans. That could result in a proper apportionment of legitimate and illegitimate debt at the end of this case if the Quinns proved their claims, he noted.

He rejected the bank’s claims the EC 2003 Market Abuse Directive and other laws “ring-fenced” matters to the extent the courts cannot prevent enforcement of an illegal contract.

The illegality defence rests ultimately on principles of public policy that courts will not assist a plaintiff guilty of illegal or grossly immoral conduct of which the courts should take notice, he said.

The bank had argued, if the family proved the loans were issued in breach of Market Abuse Regulations 2005 and the ban in Section 60 of the Companies Act on a company providing financial assistance to buy its own shares, the loans must stand with the family’s only remedy being statutory penalties including a maximum € 10m fine and/or a ten year jail term.

Allowing a share transaction to be unwound would “cause chaos” in the marketplace, it argued.

At the request of the Director of Public Prosecutions, the main action has been deferred pending the hearing of criminal proceedings against former Anglo Chairman Seán Fitzpatrick and other former senior executives of the bank.