JMSE shuts main steel business due to difficulties arising from Flood tribunal

Joseph Murphy Structural Engineers, the company that made the controversial payment of at least £30,000 to Ray Burke, says it has experienced "considerable trading difficulties" arising from its involvement at the Flood tribunal.

Because of these difficulties, JMSE has ceased operations in its main area of business - the design, fabrication and erection of steel structures, according to the directors' report submitted with the company's latest set of accounts.

Losses after tax were £1.112 million (€1.41 million), according to the accounts for the year ending May 31st, 1999. The accounts included an entry for "tribunal costs" of £501,000 in 1999 and £107,000 in 1998. No provision has been made for any shortfall in the recovery of tribunal costs. Costs for the year 2000 are likely to be higher.

The tribunal spent three weeks in Guernsey taking evidence from the founder of JMSE, Mr Joseph Murphy senior, in October 1999. His son, company chairman Mr Joseph Murphy junior, gave evidence in Dublin in November and December. JMSE's involvement arises from allegations made by its former chairman, 84-year-old Mr James Gogarty, who alleged that he paid the money to Mr Burke to secure the rezoning of over 700 acres owned by Mr Murphy senior in north Dublin.

The company responded by claiming Mr Gogarty acted on a "frolic" of his own, arising from a vendetta against the Murphys. The directors attribute the company's trading difficulties to "a result of being deeply involved in quasi-judicial matters".

"The ramifications of this have been so far-reaching that the Directors have no choice but to cease steel design, fabrication and erection operations. The directors do not envisage that the company will recommence trading in structural steel business in the foreseeable future."

The resignation in September 1999 of Mr Murphy junior and his sister Angela from the board are noted in the accounts. JMSE and its subsidiary, JMSE (UK), employed 155 people in 1999. The company's lands and premises were valued by the directors on an existing use value at £3.48 million in May 1999. In June 2000, a valuer put their worth at £5.2 million on an existing use basis and £11.2 million for alternative use.

Another company, Bovale Developments, has also experienced difficulties arising from the tribunal. Bovale's director, Mr Michael Bailey, accompanied Mr Gogarty to Mr Burke's house when the payment was made in June, 1989. He later bought the lands in north Dublin.

In a report accompanying Bovale's accounts for the year ended June 30th, 1998, the company's auditors say they were unable to determine the liability arising from the company's involvement at the tribunal. The auditors, McGrath and Co, add that they were unable to determine whether all liabilities had been provided at the accounting date due to the fact that proper accounts were not kept.