An action by a Derry-based construction company against the former Taoiseach, Mr Albert Reynolds, a Meath businessman, Mr Patrick Russell, and a Channel Islands company has been settled at the High Court. Mr Lyndon MacCann for O'Neill Brothers (Building Contractors) Ltd, of Pennyburn Industrial Estate, Derry said yesterday the action had been settled and could be struck out.

Counsel also asked the court to discharge an injunction which had restrained Mr Russell, of Hill of Down, Enfield, from reducing his assets below £875,000 (€1.1 million).

The third defendant was Universal Management Consultants Ltd of St Helier, Jersey, Channel Islands. Mr Justice O'Higgins made the order sought.

O'Neill's claimed it had paid out £650,000 sterling (€1 million) to the defendants in relation to a joint venture agreement relating to proposed construction projects at two sites.

A previous hearing was told O'Neill's claimed it had had extensive dealings with Mr Reynolds and Mr Russell from 1997 regarding possible projects in Derry and Swords, Co Dublin.

An earlier hearing was told by counsel for Mr Reynolds his client entirely rejected the allegations against him. Counsel for the O'Neills said the company had had extensive dealings with Mr Reynolds and Mr Russell. In an affidavit, Mr Desmond O'Neill, a director of the Derry firm, said it had paid out a total of £650,000 sterling.

Mr O'Neill had claimed a number of meetings took place with Mr Reynolds who introduced them to Mr Russell who, according to Mr Reynolds, was going to provide detailed knowledge and expertise in the day-today management of the projects.

Mr O'Neill said the Derry project encountered difficulties from 1998. He alleged the defendants defaulted in producing funds which they had agreed to produce.