The former directors of a bonded warehousing company now in liquidation have been made liable for the company's debts of €1.5 million.

The two directors, one of whom is deceased, have had a judgment made against them, on consent, and arising out of allegations by the liquidators that they engaged in fraud and reckless trading.

In what is thought to be only the ninth or 10th time the section has been applied, the directors of Eastland Warehousing Ltd have been made personally liable for their company's debts under section 297 (a) of the Companies Act 1963. Mr John McDonnell (53), of Swords, Co Dublin, and the estate of Mr Joseph McNamara, formerly of Dún Laoghaire, Co Dublin, consented to the orders sought this week by liquidators Mr Tom Kavanagh and Mr Paul Wyse. The largest creditor of the company is the Revenue.

Mr McDonnell yesterday told The Irish Times that he represented himself in the case as he could not afford legal representation. He said he had no money and that the liquidators would not be getting any money as a result of the order.

The liquidators alleged that approximately €3.5 million in excise duties and VAT raised from wine sales had not been disclosed to the Revenue. Money due to the Revenue had been lodged to "secret" accounts in First National Building Society.

The company went into liquidation in 1997 and Mr McNamara died shortly thereafter. The liquidators subsequently raised €2 million by selling the East Wall warehouse, which was owned by another company owned by the two directors, leaving net debts of €1.5 million.

The liquidators sought an order from the High Court declaring that the defendants were knowingly a party to the carrying on of the business of Eastland Warehousing with an intent to defraud the Revenue, and/or were knowingly a party to carrying on the business in a reckless manner.

Other persons who have been made personally liable for the debts of companies in the past include investment brokers Mark Synott and Tony Taylor.