A Finnish company which acquired three Irish timber merchants in 1981, claimed in the High Court yesterday that there was a shortfall of approximately £2.4 million in five separate pension schemes which it took over as part of the purchase deal.

UPM Kymmene Corporation of Helsinki claims that, according to its calculations, the current investment value of such a sum, properly invested over the last 16 years, would be in the region of £17 million.

The company, formerly Rauma Repola OY, through its Irish subsidiary Rauma Repola (Ireland) Limited, acquired Brooks Haughton of Cork, Brooks Hanley of Sligo and Brooks Thomas of Dublin from BWG Limited, formerly known as the Brooks Watson Group, in December 1981.

It is seeking damages from BWG Limited while Irish Pensions Trust Limited and solicitors McCann Fitzgerald have been joined as third parties to the proceedings.

The Finnish company said that at the time of the deal, the defendant warranted that the pensions of the three companies purchased were fully funded and were adequate to provide all future benefits relating to service prior to completion of the contract.

Letters of disclosure furnished on December 21st, 1981, did not make any material derogation from these warranties, it said.

UPM Kymmene says it is entitled to be indemnified in respect of all payments it made in eliminating the pension fund shortfall.

In its defence, BWG Limited denied it either warranted or represented that the pension funds concerned were fully funded at the time or were adequate to provide all future benefits relating to service prior to the sale contract. It argued that, on the contrary, a disclosure letter and three letters from Irish Pensions Trust revealed the position with regard to the pension schemes and put the plaintiff companies on notice of the situation.

The case is expected to last two weeks.