The Navan branch of the Bank of Ireland has been told by the High Court to stop bouncing cheques drawn on the account of Shamrock Homes Ltd, a leading Co Meath building developer.
Mr Justice Murphy heard yesterday that, despite the company having about €237,000 to its credit in the Navan branch, the manager, Mr Padraic Brennan, had returned eight cheques payable to the Revenue Commissioners and suppliers and sub-contractors marked "not drawn in accordance with mandate".
Mr Dominick Hussey SC, counsel for Shamrock Homes, said the money was effectively frozen in the bank because of a dispute over which company directors had the power to sign cheques.
Mr Gerard Davidson, a Shamrock Homes director, of Lakepoint Park, The Avenue, Mullingar, Co Westmeath, said that before September 18th there had been two other directors.
These were Mr Thomas Sheedy, Pairc Muire, Newbridge, Co Kildare, and Mr Richard Heaney, Gravelmount Orchard, Castletown, Co Meath.
As a result of difficulties between all three directors he and Mr Sheedy had requested Mr Heaney's resignation, which, in accordance with the company's articles of association, removed Mr Heaney as a director.
The company, which was currently building 76 apartments at Ushnaugh Court, Lynn Road, Mullingar, and another 92 at James's Street, Dublin, had mandated the bank to the effect that two of the three directors could sign cheques.
After September 18th the bank had been advised that Mr Davidson and Mr Sheedy were the active directors and all instructions would come from them.
Mr Brennan had replied that the bank had received conflicting instructions contrary to the existing mandate regarding the operation of company accounts.
He had said the bank could not permit the accounts to operate until the issue had been resolved between the directors and that from September 20th any cheques presented would be returned "not drawn in accordance with mandate".
Mr Davidson said if the bank had received instructions from Mr Heaney in relation to the mandate they had not carried the signature of any other director.
He believed Mr Heaney had wrongfully interfered with the business of the company and that the bank had acted in a manner which supported his interference.
Mr Justice Murphy restrained the bank from countermanding and returning the company's cheques and from allowing interference by third parties with the company's account.