Ireland

Give me a crash course in . . . Seán Quinn's nonbankruptcy

So, is Seán Quinn bankrupt or not? No, he’s not. He was, though

Colm Keena's face
Colm Keena
Sat Jan 14 2012 - 00:00

So, is Seán Quinn bankrupt or not?No, he's not. He was, though. In November he took the Irish Bank Resolution Corporation (formerly Anglo Irish Bank) by surprise when he made an ex parte (ie without any notice to any other party) application to the Northern courts for bankruptcy status. Formerly Ireland's richest man, he told the court he had assets of about £50,000 and the right to a small pension, of about £10,000 a year. His application was granted but quickly appealed by the bank.

And?The bank won. Earlier this week Mr Justice Donnell Deeny, in the Belfast High Court, ruled that Quinn's centre of main interest was in the Republic, not in Northern Ireland as claimed by Quinn. Quinn, who lives in Co Cavan, claimed he operated from an office in his native village of Derrylin, Co Fermanagh. The judge rejected the latter claim, despite Quinn's production of a lease in support of his claim.

So he's not a bankrupt, then?No. However, as soon as his bankruptcy was annulled in Belfast, IBRC (which is now a State-owned bank) went to the High Court in Dublin and sought an early hearing for an application to have him declared a bankrupt in the Republic. That hearing is likely to be heard on Monday.

So will he be declared a bankrupt on Monday?Probably.

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Why is the bank bothered?Good question. Its application in Belfast involved some very expensive legal chaps, and the case in Dublin will clock up further legal costs. In Belfast it said having Quinn a bankrupt in the Republic rather than the North would save it some legal fees, but that doesn't seem entirely convincing. The judge decided that motive wasn't a key issue for him. The difference is big for Quinn, in that he could emerge from bankruptcy in Northern Ireland in 12 months, while in the Republic it will probably take him 12 years. He's 65 years old, and he told the court in Belfast he spends at least part of his time in his Derrylin office, thinking about new business ventures.

So what's in it for the bank?We don't really know. Quinn's debt to IBRC is a mindboggling €2.88 billion plus interest, or about the sum the Government will seek to raise/save in next year's budget. As he said he has only £50,000 in assets, on the face of it Quinn won't even be able to pay his legal costs, let alone those of IBRC. (At the end of the Belfast case IBRC asked the judge to order Quinn to reveal who was paying his costs. Mr Justice Deeny didn't, but the issue may yet return.)

So there's no money for the State at the end of all this?It's not so simple. Quinn's family are disputing the €2.88 billion debt to IBRC, claiming it is linked to Anglo's attempt to use its own money to prop up its share price some years ago. A case in the High Court on that matter is due to begin shortly. Meanwhile, the bank has seized the Quinn Group, and is seeking to seize properties in Europe and elsewhere owned by Quinn's children. These could have a value of up to €500 million.