The Dublin West TD, Mr Liam Lawlor, has still not "met his obligations" to the Flood tribunal to supply it with all the financial documents it is seeking from him, lawyers for the tribunal told the High Court. Mr Lawlor claimed he has complied fully with his obligations.
In an affidavit, Mr Lawlor said his financial situation around 1995 was "dire". He was under great financial pressure, with substantial bank and other debts in Ireland approaching £1 million. He later reached agreement with the banks.
In January last, Mr Lawlor spent seven days in jail and was fined £19,000, with costs of about £200,000, for failing to co-operate with the tribunal by providing it with financial documents. At the time, Mr Justice Smyth suspended the remainder of a three-month sentence on condition that Mr Lawlor supplied the tribunal with the records sought.
When the case was last before the High Court, the tribunal said it had been given another 150 folders of documents but still had a number of concerns.
At the start of yesterday's hearing, Mr Frank Clarke SC, for the tribunal, said it appeared Mr Lawlor had not met his obligations. He said there were some complex areas which the court might not be able to resolve through affidavits and there might be cross-examination of witnesses.
The consequences of a finding of failure to comply by Mr Lawlor were serious and it was important that care was exercised, counsel said.
Mr Lawlor had been found to have been in contempt, Mr Clarke said. That had been decided and was not being reopened. The appropriate penalty for the contempt had been decided last January. The court would have to review whether Mr Lawlor had met the conditions on which it suspended sentence. If the court was satisfied the discovery met the conditions, the matter ended. But if the discovery did not do so, the court would decide what it should do.
In an affidavit, Ms Maire Anne Howard, for the tribunal, referred to the delivery by Mr Lawlor of various folders of documents. She said the tribunal had concerns in three categories of documents, the first of which was bank-related. To date, the tribunal had received from Mr Lawlor documents for 69 bank accounts. Since the January order, it had received documents for 41 bank accounts. There remained gaps in the documents received for the 69 accounts. The tribunal was particularly concerned about funds held in Liechtenstein and related movements of funds. During public sittings of the tribunal, there had been questions over a Czech Republic loan. Mr Lawlor had referred to a Morgan family trust. Nothing in any contemporaneous documents discovered referred to the trust fund.
As would be shown, by July 1995, it was arranged that Mr Lawlor's debt to Irish banks would be settled for £563,000, of which £410,000 or so would accrue from the sale of lands in Lucan, leaving a balance of £153,000 and not £300,000 sterling. Monies drawn down from Liechtenstein amounted to about £664,000 and the majority of draw-downs did not appear to relate to an existing debt in 1995.
Ms Howard said there was a significant dearth of documents generated by or on behalf of Mr Lawlor around the time he settled all his bank debts in Ireland in 1995. She referred to a significant role played by accountant Mr Luke Mooney, of CFI Ltd, Clonskeagh, in the affairs of Mr Lawlor, and the absence of any of Mr Mooney's files or Mr Lawlor's files on these dealings.
From a check of documents, Ms Howard said Mr Lawlor said, at some time after July 1995, that he owed Irish banks about £995,000 and his main creditor was ACC Bank, which had a charge on debts of some £640,000 on 23 acres adjacent to five acres on which Mr Lawlor's home in Lucan was situated.
In July 1995, the 23 acres were sold at auction for £410,000 which, exclusive of solicitors' and auctioneers' fees, was paid to ACC Bank in full settlement of Mr Lawlor's debts. It appeared other Irish bank creditors agreed to accept £153,000. Mr Lawlor had not produced records of the negotiations and arrangements between him and his creditors.
Ms Howard said those creditors agreed to accept such amounts following negotiations with Mr Lawlor conducted primarily by his financial adviser, Mr Mooney. However, Mr Lawlor's explanation that funds which arrived in his bank accounts here from Liechtenstein were to defray those debts was difficult to understand.
In a replying affidavit, Mr Lawlor said he had discovered to the tribunal all documents received by him. His former solicitors had written to each of the financial institutions he remembered dealing with over the past 20 years.
Mr Lawlor said he had gone to the Czech Republic in the early 1990s to explore the possibility of investing in property. In the early 1990s, he had considerable liabilities and was under great pressure to generate income. Unfortunately, property transactions did not happen as quickly as he anticipated and by 1995 he had not secured significant repayment. By 1995, his financial situation was dire. His friend of some years, Mr Luke Mooney, acted as his financial consultant and negotiated directly with the banks to settle debts. Matters were so pressing there was not enough time to commit details to correspondence, he said.
The hearing continues next Monday.