The trustees of an RTÉ employees' pension fund have sued in an effort to redeem some €19 million of an alleged outstanding investment in a property fund.

The trustees of RTESA, the defined benefits pension scheme for some current and former employees of RTÉ, have brought the Commercial Court proceedings over an investment in the Davy Property Fund, a sub-fund of the Davy Property Trust.

In its proceedings against Advance Fund Management Ltd and BNY Mellon Trust Company Ltd, RTESA claims the defendants have wrongfully refused to redeem the investment in full as expeditiously as possible and continue to retain control of more than €19 million of RTESA's funds.

Advance Fund Management is manager of the trust and BNY Mellon Trust Company is trustee.

Entire investment

RTESA claims the defendants have failed to redeem in full its entire investment in the fund of more than €21 million and continue to retain control of more than €19 million. RTESA sought redemption of the monies in late 2014 and claims there is no bona fide or objective justification for refusing to repay it.

The defendants had, it is alleged, established a new sub-fund in the trust in order to obtain de facto control of the trust for the J&E Davy Group. RTESA also alleges that trust deeds, documents and accounts were withheld.

Trust powers were exercised by the defendants in the interests of the J&E Davy Group, rather than in the interests of the fund’s beneficiaries, it is claimed.

It is claimed the alleged actions amount to breach of contract, of trust and of fiduciary duty by the defendants.

Mr Justice Brian McGovern agreed yesterday to transfer the case to the Commercial Court after being told by Cian Ferriter SC, for RTESA, the sides were consenting to the matter being included in the fast-track Commercial Court list.

Voting rights

In a sworn statement,

Conor Hayes

, chairman of the board of trustees of the RTÉ fund, said J&E Davys Group acquired Advance Fund Management Ltd in 2014 and took over management of the fund. The defendants then amended the trust deeds to establish a new sub-fund in the trust, he said.

RTESA believes investors in the new sub-fund, who were awarded some 75 per cent voting rights in the trust, were connected to Advance Fund Management. That deprived RTESA of its control of the trust and the ability to remove Advance Fund Management Ltd as manager, he said.

RTESA has lost trust and confidence in the defendants and had served notice in November 2014 seeking to redeem its full investment.