Killilea move to question official disputed in court

Gayle Killilea's attempt to win orders allowing her lawyers to cross-examine the official administering the bankruptcy of her estranged husband, developer Seán Dunne, should be refused as unnecessary, the High Court has been told.

Ms Killilea's lawyers want to cross-examine official assignee Chris Lehane about the basis for his belief Mr Dunne may have transferred substantial assets to her as part of alleged efforts to put his assets beyond the reach of his creditors.

On Wednesday, the second day of the hearing of her application, Mark Sanfey SC, for Mr Lehane, said the court will be more than able to assess whether beliefs of Mr Lehane, based on his investigations, were overstated.

A court could do that without cross examination and, should it find Mr Lehane over-stated matters, that would accordingly weaken his case, counsel said.

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Ms Killilea is challenging the basis for various claims by Mr Lehane, on foot of which he previously got a temporary order freezing her assets below €50 million.

She wants the court to permit her lawyers cross-examine Mr Lehane about his affidavits for the injunction application.

A hearing on whether the injunction should remain in place, pending full trial of all matters, has yet to take place.

Creditors

A central part of Mr Lehane’s assertion of a scheme by the couple to put assets beyond the reach of creditors relates to a house in Dublin bought in 2005 by Mr Dunne and shortly afterwards transferred to Ms Killilea.

Walford, on Shrewsbury Road, was bought by Mr Dunne for €58 million, making it the most expensive home in Ireland at the time. It was later transferred to Yesreb, a Cypriot-registered trust. It was sold last year for €14.2 million, by Yesreb, to another trust whose ultimate settlor is businessman Dermot Desmond. The proceeds of that sale are held in an escrow account pending the outcome of legal proceedings.

The court heard both Mr Dunne and Ms Killilea had denied knowledge of Yesreb at other hearings.

In an affidavit, Mr Lehane said Ms Killilea had stated in evidence, in a separate case related to other companies she was involved in, she gave a loan note in 2013 for €11.5 million to her stepson John Dunne, Seán Dunne’s son from his first marriage, to buy Walford from her.

Ownership was transferred to Yesreb, a Cyprus-registered trust, whereby if Walford was sold, the profits would go to the children of Ms Killilea and Mr Dunne and also to John Dunne.

Statement

Mr Sanfey said, despite the claim of the €11.5 million loan note, John Dunne has not to date sworn a statement in relation to it.

Mr Lehane had been given no evidence to show €11.5 million was repaid to Ms Killilea by Yesreb, counsel said.

The court heard Ms Killilea, who was referred to as Dunne by the Lehane side and Killilea by her own counsel, had judicially separated from Mr Dunne in 2010.

She says she is a businesswoman in her own right and cannot be held responsible for what Mr Dunne has said.

She insists Mr Dunne had bought Walford for her, in trust, in 2005.

Mr Lehane says there is evidence to show Mr Dunne claimed ownership, including in a “letter of wishes” signed in 2007.

When the full hearing of the freezing order injunction takes place, these are matters which can be addressed, Mr Sanfey argued. They were not matters which required the cross-examination of Mr Lehane, he said.

If the court does decide Mr Lehane should be cross-examined, then Mr Lehane’s side would seek to be permitted cross-examine Ms Killilea too, counsel said.

In reply, Alan Doherty SC, for Ms Killilea said the freezing order application was exceptional for a number of reasons.

These included “mis-statements and overstatements” by Mr Lehane in his affidavit, including his claim Yesreb was not to be trusted, counsel said. The level of omissions by Mr Lehane in his affidavits was “exceptional”, he argued.

Ms Killilea is prepared, and wants, to give evidence when the full freezing order hearing takes place, he said.

Ms Justice Caroline Costello has reserved her judgment.