The Master of the High Court yesterday examined an ICC Bank solicitor about the bank's dealings with a Co Roscommon firm in liquidation, Mantruck Services.

Last March Ms Justice Laffoy ordered the bank's solicitor, Mr John Larney, to attend before Master Harry Hill SC to answer questions about an ICC loan to Manton and Co, secured on a factory premises and land at Farnbeg, in Strokestown.

The official liquidator of Mantruck Services, Mr David F. Mehigan, had claimed in an affidavit that, over several years, the ICC had had dealings with the Farnbeg property which "had a common object of seeking to ensure the property remained under the effective control of Mr John Deignan in whichever of his companies was not, for the time being, in liquidation or in immediate danger of going into liquidation".

Before its liquidation, Mantruck conducted business from an industrial premises at Farnbeg of which Manton was registered owner in 1979. Mr Mehigan believed Mr Deignan controlled both Manton and Mantruck.

Records suggested in 1990 that Sunshine Freight (in liquidation), trading as Manton International, was indebted to ICC. Mr Mehigan said, when he travelled to Strokestown on July 29th, 1993, Mr Deignan - and later ICC - told him ICC had possession of the property but that Mr Deignan was in possession following a caretaker's agreement.

ICC adopted the position that all its dealings had been with Manton and that it had no dealings with Sunshine Freight or Mantruck. ICC indicated it would sell the property on the open market.

Yesterday, Mr Larney, under cross-examination by Mr Senan Allen SC, for the liquidator, agreed the ICC had made loans to Manton in 1979. In effect, ICC only had loans with Manton and a mortgage over the Farnbeg property.

Asked if ICC was not aware of any payments by Sunshine Freight and Mantruck towards the ICC loans, Mr Larney said the ICC would be unaware of sources of funds and was unaware of payments.

In September 1992, ICC had demanded repayment of the loans and was seeking recovery of the property, he said. Following legal advice , ICC realised it was in a very difficult position and believed it would not be able to sell to anybody other than Mr John Deignan. Mr Allen said three valuations at £45,000 to £50,000 had been obtained. The amount outstanding to ICC had been £49,000 and Mr Deignan eventually paid £50,000.

Mr Larney denied that Mr Deignan had a hand in choosing a Co Roscommon auctioneer as one of the valuers. By June 1993 ICC had lost all faith in Mr Deignan and wanted to "get out of this mess". The cross-examination resumes next Wednesday.