Solicitor concerned overaccountant's evidence

A London solicitor acting for Denis O'Brien's interests in a dispute over Doncaster Rovers Football Club (DRFC) Ltd was concerned about evidence that might be given by a Northern Ireland businessman, Kevin Phelan, the tribunal heard.

An English accountant, Craig Tallents, was giving evidence in the first day of witness testimony in the tribunal's inquiry into whether former government minister Michael Lowry had a connection with the purchase of DRFC in 1998 for £4.3 million.

Mr O'Brien has said the deal was exclusively his and Mr Lowry had no involvement.

Mr Tallents, who worked on the books of DRFC after the 1998 purchase, told Jacqueline O'Brien SC, for the tribunal, that some of the funds from the transaction went into "retention" pending the resolution of certain matters.

He worked on trying to resolve these matters but a dispute arose with the vendors, Ken Richardson and Mark Weaver, and eventually litigation was initiated by the vendors.

Ruth Collard, a partner with Peter Carter-Ruck solicitors, London, acted for the O'Brien interest in the dispute. Mr Tallents said Ms Collard had concerns in regard to the evidence that would be given by Mr Phelan.

Mr Phelan was the person who had spotted the potential of the Doncaster deal, but had in time fallen out with Mr O'Brien's then accountant, Aidan Phelan, who was for a time in charge of the DRFC project.

Mr Tallents said he believed the fall-out between the two men, who are not related, was over money Kevin Phelan was saying he was due.

"We didn't really know where we stood with Kevin Phelan," Mr Tallents said. He said he had not known, at the time, that William Fry solicitors were in negotiations with Kevin Phelan and that on August 22nd, 2002, he was paid stg £150,000.

Ms O'Brien also read out a note of Ms Collard of a telephone conversation she had with Mr O'Brien's father, Denis O'Brien snr, on June 20th, 2002, concerning the dispute with the vendors. In the note Mr O'Brien is recorded as saying he had seen a letter to Kevin Phelan from Reg Ashworth, the solicitor acting for the vendors. Ms Collard said she did not want to see the letter and that it was privileged.

The letter, which was also read out by Ms O'Brien, said the vendors were going to call Kevin Phelan as a witness. "I am sure you will be a truthful witness and your co-operation in this whole matter is now sought on the basis that you now no longer have any direct contact with Westferry."

Westferry was the corporate vehicle through which DRFC was owned by an O'Brien family trust.

Mr Tallents said he was initially asked to work for DRFC by businessman Paul May, who was the de facto managing director of DRFC in the period after the 1998 transaction. He also had a substantial amount of contact with Kevin Phelan. Later Mr Tallents began reporting to Aidan Phelan.

Kevin Phelan began drifting out of the picture as the retention fund dispute developed. When Aidan Phelan began to "move away" in early 2002, John Ryall, who works for Denis O'Brien in Dublin, became involved.