Two brothers claimed at the High Court yesterday that they were defamed in a circular letter sent out by the Irish Brokers' Association after they complained of serious breaches in its accounts.

Mr Albert Dawson (63), of Knocknashee, Goatstown, Dublin, and his brother, Dudley (59), of Maywood Drive, Raheny, Dublin, are seeking damages from the IBA, of Merrion Square, Dublin, in an action before Mr Justice Peter Kelly and a jury.

The brothers, trading as A. E. Dawson and Sons, insurance brokers, Maywood Drive, Raheny, Dublin, say they were defamed by a letter sent by the IBA in April 1992, in which it was stated that their firm was no longer a member of the association.

Liability was accepted by the IBA, Mr Justice Kelly told the jury, and their only task was to assess damages. The Dawsons, who are representing themselves in court, told the jury their business has been in existence for more than 35 years. Their company was started by their father when he retired from the Garda.

Mr Albert Dawson told the jury that he and his brother were persons of the highest integrity and impeccable financial status.

The IBA and brokers in general were regulated under the terms of the 1989

Insurance Act, he said. His firm had been a member of the IBA both before and after the Act came into force.

At the beginning of 1991, an incident arose which caused them to doubt the integrity of the IBA and they asked to see the accounts of the association. No member of the IBA had ever received any accounts of the IBA's compensation fund, he said.

In February 1992, the IBA attempted to hold an annual general meeting, at which abridged accounts were to be submitted. This was a serious breach of the Companies Act, Mr Dawson said. Full accounts were required and 21 days' notice had to be allowed before calling an annual general meeting.

Mr Albert Dawson said they were highly suspicious of the abridged accounts, which did not contain any accounts of the IBA's compensation fund. He said they suspected serious irregularities and wrote to the IBA pointing out that it was in breach of the Insurance Act.

But, on April 16th 1992, the IBA wrote a letter to the Department of Industry and Commerce, the Insurance Intermediaries Compliance Bureau and all the insurance companies with which the plaintiffs had agencies, telling them that the Dawson brothers' firm's membership had been terminated, Mr Dawson said.

Mr Dawson said the IBA later wrote a gratuitous letter to insurance companies, which was calculated to undermine his firm's reputation with these companies.

In the intervening seven years since the defamation, all presidents of the IBA had had the opportunity to retract the defamation but had not done so, he said.

When the compensation fund accounts were first published at the a.g.m. in April 1992, they showed that the IBA was taking part in tax evasion, he said.

In papers read to the jury, Mr Dawson said the IBA had issued the defamatory letter in order to destroy the business and reputation of the plantiffs and to discredit anything said by them. It also sought to undermine their financial ability to pursue these issues.

By keeping about £300,000 of assets off the balance sheet, the IBA's predecessor was able to keep these assets from the scrutiny of the tax authorities and not pay tax as required by self-assessment, and thereby commit tax evasion and fraud on the public, he said.

The hearing continues today.