MacSharry loses land deal application

Former EU commissioner Ray MacSharry and his sons Ray and Marc have lost an application to prevent an accountant proceeding with claims against them in the Commercial Court concerning a land deal in Co Sligo.

Mr Justice Peter Kelly today ruled the MacSharry’s had failed to show the claims made against them by accountant Kenneth McMoreland were bound to fail or amounted to an abuse of court process and he refused to strike out those claims, meaning they will now proceed for determination.

The judge also refused an application by Aidan Redmond SC, for the MacSharrys, for orders requiring Mr McMoreland to provide security for the MacSharrys’ legal costs of defending the claims against them.

Mr McMoreland, representing himself, had opposed both applications. While conceding he had no funds to pay for legal costs should his claims be rejected, Mr McMoreland said he is a resident of the State and there was no precedent for requiring an individual litigant residing here to provide security for costs.

The applications by the MacSharrys arose as a result of an action against Mr McMoreland and others brought by three investors - brothers Arthur, Kieran and John Grady — and their company.

The plaintiffs claim they incurred losses of more than €2.4 million due to allegedly fraudulent claims by Mr McMoreland and quantity surveyor Jack (Jackie) McMahon concerning the 2006 purchase of the Saehan site in Co Sligo by Foresthaze Developments Ltd, a company of which Mr MacSharry was chairman.

The Gradys claim a sale and sub-sale arrangement in which the site was purchased in April 2006 in trust for Mr McMoreland and Mr McMahon for €9.85 million and then purchased six months later by Foresthaze for €11.5 million was withheld from them.

Mr Justice Sean Ryan last week began hearing the Gradys action, listed for two to three weeks, against Mr McMoreland, Mailcoach Road, Sligo, formerly of Gilroy Gannon accountants; others practicising as Gilroy Gannon accountants, Stephen Street, Sligo; Jackie McMahon, Creggconell, Rosses Point, Co Sligo, and Foresthaze, Millbrook, Riverside, Sligo.

The Gradys claim a gain from the alleged sub-sale was retained by Mr McMoreland and Mr McMahon and are claiming damages, including exemplary damages, against both men, plus an indemnity against any claims made under guarantees for €1 million in favour of Foresthaze provided by them to Allied Irish Banks.

Mr McMoreland has denied the claims. He also joined the MacSharry’s and others as third parties to the proceedings and has made several claims about the third parties knowledge of events concerning the deal.

Those claims are disputed and will be determined following Mr Justice Ryan’s decision on the claims against the defendants.

The third parties are Ray MacSharry Senior and his sons Ray Junior and Marc; Gerard Healy c/o Kevinsfort Ltd, Castle Street, Sligo; Damien Torsney, Merrion Road, Ballsbridge, Dublin 4; and Edward Donaghy and Jacqueline Donaghy, Castletown,

Drumcliffe, Co Sligo.

After Mr Justice Kelly’s ruling on the MacSharry’s motions Andrew Walker SC, for Mr Torsney, said he had intended making similar arguments on similar motions brought by his client. In those circumstances, the judge said he would also dismiss those applications.

Mr McMoreland has claimed the promoters of the Saehan development were Ray MacSharry Senior, Marc MacSharry, himself and Mr McMahon and they, plus the other third parties, agreed to represent to banks the contract price for the site was €11.5 million to get more funds. Mr McMoreland has also claimed the net uplift fromn the sub-sale was credited to Foresthaze and it was agreed the promoters would not derive any benefit whatsoever from it.