A PROPERTY developer carried out a fraud on his estranged wife when he transferred a loan of €965,000 from their company to another firm, a High Court judge has ruled.
Desmond Bell, Cookstown, Co Tyrone, had claimed his wife Martina had left the running of their business to him. While admitting he forged her signature on the loan documents, he claimed he did so to keep his building work going and to provide for his family.
Mr Justice Daniel Herbert yesterday gave judgment on proceedings by Mrs Bell in which she sought seeking orders under the Companies Act 1963 that the affairs of Rollville Ltd, Navan, Co Meath, of which she and her husband were co-owners, were being conducted in an oppressive manner in disregard of her interests and those of the company.
The judge ruled Mr Bell had acted oppressively as a director of Rollville and ordered him to buy out his wife’s share of the business at a price yet to be calculated. He also found Mr Bell had misapplied some of the funds of Rollville.
The judge noted the Bells were married in 1990 but became estranged in February 2006 having lived an “extraordinarily lavish lifestyle” involving buying expensive cars, jewellery, holidays and “a string of very expensive ponies” for their children.
In her action, Mrs Bell alleged Mr Bell had in March 2006 forged her signature on documents to obtain a loan for €965,904 from Bank of Scotland Ireland.
She also claimed he had in October 2006 fraudulently procured Rollville to make that same loan to a Northern Ireland registered company, Duval Estates Ltd, in which Mr Bell and his builder brother Martin held the majority of shares. Mrs Bell said she held a single share (in Duval) which carried restricted rights.
Her husband wrongfully provided security for the loan as a charge over three apartments in a 48-apartment complex at Mountgorry Wood, Malahide, Dublin, which Rollville had developed between 2003 and 2005, she also claimed.
On the second day of the trial of the action, as a handwriting expert and several bank officials were about to be called to give evidence, Mr Bell had admitted he had forged his wife’s signature on the loan documents, the judge noted.
He had also admitted using the Malahide apartments as security without his wife’s approval or knowledge, the judge added.
Mr Bell claimed Mrs Bell had at all times left the running of Rollville to him and had insisted the loan to Duval was bona fide. Mr Bell had said his sole object in arranging the loan to Duval was to ensure a supply of work to provide for his family, even after the marriage breakdown in 2006.
The judge found the transfer of the €965,000 to Duval was a fraud on Mr Bell’s wife as a member of Rollville and involved an exercise of directors’ powers by Mr Bell in a manner oppressive to his wife and in “total disregard” for her interest in the firm.
The judge said Mr Bell drew just over €1 million from Rollville between October 2002 and October 2005. Despite the paucity of documents about those monies, the judge said he was satisfied the Bell family “lived an extraordinarily lavish lifestyle”. However, he was not satisfied it had been established the money was spent on the family or there was a deliberate attempt to misappropriate Rollville funds.
The judge said he was satisfied €249,968 payments made between 2005 and 2006 by Rollville to a renovation business called Bell Contracts, owned by Mr Bell and his brother Martin, amounted to “a continuous misapplication” of Rollville’s funds and Mr Bell had acted in “total disregard” for his wife in doing so.
The judge said it would not be in the best interests of the company to order its winding up and he would order Mr Bell to purchase his wife’s 50 per cent share in it. In doing so, he was assuming the €965,000 loan had been repaid by Duval, all bank loans discharged, misapplied funds repaid, Rollville had no liabilities and the Malahide apartments were no longer held as security, he said. He adjourned the case to March to allow the price to be calculated.