An estimated 40 million documents are being collected for the action by the joint administrators of Quinn Insurance claiming some €1 billion damages against the former auditors of the company, PricewaterhouseCoopers, over alleged negligent auditing of the company’s accounts, the High Court has heard.

Should the administrators win their case, listed for hearing in 2016, any damages recovered will be used to partly or fully repay the State’s Insurance Compensation Fund from which some €1.158 billion has been drawn down to date to meet claims of Quinn policyholders. Further drawdowns are expected.

‘Unvarnished’

The president of the High Court, Mr Justice Nicholas Kearns, rejected an offer by Bernard Dunleavy, for the joint administrators, for lawyers handling the PwC case to give the court an “unvarnished” view of the prospects for success in that litigation. Mr Dunleavy said it was in the public interest matters raised in any such hearing should be confidential and, if the court wished such a hearing, he would make an application under provisions of the Insurance Act for an in camera hearing.

Mr Justice Kearns thanked the administrators for the offer but said he considered such a hearing could make the court almost a player in the litigation and he would decline the offer.

Earlier, Mr Dunleavy, when presenting the 15th report of joint administrators Michael McAteer and Paul McCann to the court, said they had made a profit of some €208 million arising from property sales, currency hedging and other factors, over the past year. Of that figure, some €100 million was previously repaid to the Insurance Compensation Fund (ICF).

Some of those profits arose from the High Court seeking firm information from the administrators concerning fluctuations of assessments of claims reserves and the judge having expressed a view concerning the benefits of taking a hedging position on sterling, counsel outlined.

Hedging

Some €26 million profits were made from the hedging and the administators had also negotiated an €18 million reduction of cash with Liberty Insurance and made €16 million on sales of properties. As a result of the sale of a windfarm and of another investment, some €100 million had been repaid to the ICF, he added.

Other properties are to be sold later this year, include the company’s largest property, located in Cork and a landfill site in Co Armagh.

Some €17 million had also been saved against end of year claims estimates for 2013, counsel said. There were some 10,500 claims outstanding in 2011 but these had been reduced to 3,500. It was expected new claims would peter out in the next 12-18 months.