A High Court judge yesterday refused to make any order against the directors of Malahide Community Council Ltd.
The company engaged in lengthy legal proceedings over planning issues in the area and went into liquidation in 1998 with assets of £678 and liabilities of £349,742.
The liquidator of the company, Mr Julian Caplin, had asked the opinion of the court as to whether the directors should be restricted under Section 150 of the Companies Act from acting as directors of a company with a paid-up capital of less than £50,000 for aperiod of five years.
Voluntary liquidation of the company followed an order for costs made against it by the Supreme Court. Initially, the company had won High Court proceedings in relation to lands at Malahide, but that decision was overturned by the Supreme Court.
The company was ordered to pay the legal costs of Fingal County Council and three development companies which had been joined as notice parties, Gannon Homes Ltd, Nasanna Ltd and Comeragh Properties Ltd.
Mr Justice McCracken said he had no doubt that practical legal advice had been obtained by the company in taking the proceedings. He did not think it could be said that it was irresponsible for the directors to have acted on that advice and in the genuine interests of their members.
The judge said it was a very unusual situation involving a guaranteed, non-profit company with the objective of protecting the social and cultural welfare of the community. It was clearly within its powers to have taken the proceedings. An individual living in Malahide was hardly going to take on the council and developers on his own. That was the basis for forming the company. What was done was done in the interests of the community.
The directors of the community company were William O'Brien, Graham Cure, Maurice Ahern, Gerard Duggan, Christopher Heavey, Phillip Bosonnet and Thomas Horan. Mr Ahern is a former lord mayor of Dublin and Mr Duggan is a board member of CIÉ and a director of Iarnród Éireann.
Mr Mark Sanfey, for the liquidator, said his client was happy to acknowledge that the directors were well-intentioned individuals who had sought to act in the best interests of the community. Nevertheless, the directors had taken the view that they should proceed by way of limited company. They had a responsibility to the creditors of the company.
Mr Brian Murray SC, for the community council and the directors, said there was no suggestion that the directors had acted dishonestly. The only issue was as to their responsibility. The company was a genuine one formed in accordance with Department of Environment guidelines for community associations, and its proceedings were taken on legal advice.
Malahide Community Council Ltd began its proceedings in December 1993 over decisions to rezone lands at Robswall, between Malahide and Portmarnock. In 1994 the High Court found in favour of the company, but that decision was set aside by the Supreme Court in May 1997.
In early 1998 the company was notified by the notice parties that their costs amounted to £221,000 and the council's legal costs were some £114,000.