DCC chief executive Jim Flavin has told the High Court he acted as a "conduit" between stockbrokers and a DCC subsidiary regarding the €106 million sale of the DCC stake in Fyffes plc over three days in February 2000. However, he said, he did not "negotiate" the sales.

Mr Flavin said he had "no authority" to negotiate the sales or to accept offers for the DCC stake in Fyffes because the beneficial ownership of that stake had been transferred in 1995 to the Dutch-based DCC subsidiary, Lotus Green Limited.

His clear view was, if an offer was made, "that I would in effect be the conduit of passing it on to Lotus Green".

After listening to a recording of a phone conversation on the date of the first share sale on February 3rd, 2000, which featured Mr Flavin apparently laughing after telling a broker he had "no authority", Mr Flavin said he accepted there was what appeared to be "something equivalent to or quite like a laugh". He said he has a "mannerism" where he sometimes ended a sentence with a laugh.

He said the recorded "laugh" indicated a slight feeling of discomfiture and "slight embarrassment" on his part that he was only at that point telling the broker he had "no authority".

Tapes of a number of phone conversations of February 3rd, 2000 regarding the sale of the DCC stake were played to Mr Flavin during his continuing evidence. The tapes related to conversations between Mr Flavin and stockbroker Ronan Godfrey and conversations between Mr Godfrey and another stockbroker, Bruce Ashmore.

Asked about these conversations, Mr Flavin said he was very clear that day that if a formal bid was made for the DCC shareholding, he was going to be "a conduit" of that bid to Lotus Green. He had had no negotiations on the price at which the shares were to be sold.

Asked about his referring, during another conversation with Mr Godfrey on February 3rd, to not wanting "any trail of paper" between DCC and Davy, Mr Flavin said this was "for tax reasons".

His primary concern was to ensure that a taxation scheme put in place by DCC in 1995 (to ensure that the sale of the Fyffes shareholding would be exempt from capital gains tax) operated effectively and that the paperwork reflected that any decision to accept the share offer was made by Lotus Green in Amsterdam.

Mr Flavin said a meeting with Fyffes then chairman Neil McCann and David McCann in a Dublin hotel on the eve of February 3rd, 2000, after the first share sale was both cordial and tense. He was tense because the sale of the DCC stake was not expected and Mr Neil McCann had received just five hours notice of it.

The McCanns had a bottle of champagne on ice and he believed this was the first time in his 20-year association with Fyffes when a bottle of champagne was opened. He said Mr David McCann had said: "Well, this is great, we're in business to make money for our shareholders" and that this was "a win-win situation".

Mr Flavin said he had a great sense of relief that evening about his forthcoming resignation from Fyffes (it was later mutually agreed this would happen on February 9th, 2000) because while he had enjoyed the relationship with Fyffes in the 1980s, he had not during the 1990s and was "a very unhappy camper" on the Fyffes board.

Mr Flavin was continuing his direct evidence on the 41st day of proceedings in which Fyffes claims "insider dealing" in relation to the sale of the DCC stake over three days in February 2000.

The action is against DCC, Mr Flavin and two DCC subsidiaries - S and L Investments Limited and Lotus Green - who deny the claims and plead the share sales were properly organised by Lotus Green.

Yesterday, Mr Flavin told Kevin Feeney SC, for DCC, he had received the first of a number of unsolicited offers for the DCC stake on January 27th, 2000, from Kyran McLaughlin of Davy stockbrokers who had said there was substantial demand for Fyffes shares because of Fyffes internet venture (worldoffruit.com), that the share price was rising significantly and inquiring whether DCC was interested in selling its 10.5 per cent stake. On February 1st, 2000, he received a similar inquiry "out of the blue" from Roy Barrett, managing director of Goodbody stockbrokers.

Mr Flavin said Davy had since 1976 acted as brokers for DCC. Prior to February 2000, DCC had no involvement with Goodbody. Mr Flavin said stockbrokers at the time would have very good grounds to speculate the DCC shareholding was likely to be for sale but he had not told the brokers who phoned him whether the stake was for sale.

Mr Flavin said he did not tell Mr McLaughlin or Mr Barrett that DCC had since 1995 planned to exit from Fyffes when the price was right or that the DCC shareholding had been transferred to Lotus Green which latter company would have to make the decision whether to sell.

It was only when a formal offer was made for the stock on February 3rd, 2000, that he had mentioned Lotus Green. Nor had he told the brokers at the time of the initial approaches that the sale of the stock was not under his management or control.

He knew the board of Lotus Green would have to meet to consider the sale of the stock and he had informed Fergal O'Dwyer, a director of Lotus Green, of all of the approaches made to him (Mr Flavin). By February 2nd, 2000, both Davy and Goodbody's had expressed serious interest in different amounts of Fyffes shares and at different prices.

Early on the morning of February 3rd, 2000, Mr O'Dwyer told him the Lotus Green board had met at 7.34am Amsterdam time and resolved to accept offers for all or part of the Fyffes shares at prices of €3 or more. At lunchtime, Mr O'Dwyer told him that Lotus Green had been advised by PricewaterhouseCooper that, if it was not selling the entire shareholding, Lotus Green should retain at least half its shareholding (5 per cent of Fyffes share capital) to qualify for the exemption from capital gains tax under Dutch tax law.

Later on the afternoon of February 3rd, there was a joint Davy/Goodbody approach for the shares and an offer at €3.20 was made. He did not negotiate nor was he involved in the decision to offer €3.20 per share and had no recollection of having any involvement regarding the commission to be paid to the brokers.

Once he became aware Lotus Green would accept offers of €3 or more, he "did nothing to dissuade the brokers from the impression that such a bid would succeed but at no time did I indicate to them that any offer would be accepted".

Later that afternoon, Mr Godfrey, on behalf of Davy and Goodbody clients, had made an offer for some 17.8 million shares at €3.20 per share. Mr Flavin said he had told Mr Godfrey "because I knew only Lotus Green could deal in its Fyffes shares that I had no authority on the matter and advised him that Tom Diepenhorst, director of Lotus Green, was the person who had authority to give an instruction."

He had also asked Mr Godfrey not to contact Fyffes about the sale because, given his 20-year relationship with Fyffes, he wanted to be the first person to inform the Fyffes chairman, Mr Neil McCann, of the sale. He learned later that day that Mr Dipenhorst had accepted Mr Godfrey's offer for the shareholding on behalf of Lotus Green.

Mr Flavin said he received two further unsolicited calls from Mr Barrett of Goodbody on February 8th and 14th. On February 8th, Mr Barrett offered to buy 8 million Fyffes shares at €3.60 each and on February 14th, he offered to buy some 5.3 million shares at €3.90. Mr Flavin said he told Mr Barrett he had no authority to deal and to contact Mr Diepenhorst at Lotus Green.

The case continues on Tuesday.