A number of High Court actions in which Irish Permanent plc is claiming its former chief executive, Dr Edmund Farrell, acted in breach of his duties opened before Mr Justice Geoghegan yesterday. Dr Farrell is counter-claiming that he was unfairly dismissed. Six legal actions are involved. The early part of yesterday's proceedings consisted of negotiations to settle a claim by the Irish Permanent against a Dublin solicitor, Mr Stephen MacKenzie, who had acted as a legal consultant to the Irish Permanent.
Mr Paul Gallagher SC, for the Irish Permanent, told Mr Justice Geoghegan that agreement had been reached with Mr MacKenzie and the company was withdrawing all allegations against him.
He said the Irish Permanent was continuing its proceedings against others named in the same action: Dr Farrell, of Grasmere, Westminster Road, Foxrock, Co Dublin; Mr Kelvin Smythe, a financial consultant of Eagle Lodge, Sydney Avenue, Blackrock, Co Dublin; and Quasar Corporation, a company incorporated in Delaware and described as a financial consultant to Irish Permanent.
The statement of claim in this action alleged that in August 1987 the Irish Permanent agreed to buy the Farrell residence, Grasmere, and lease it back to him at a yearly rent of £17,500.
The Irish Permanent alleges about £437,000 was spent on the property by the company at the behest of Dr Farrell who knew he could exercise an option in the agreement to buy back the property for £275,000.
The Irish Permanent claims that advice was sought from the company's auditors for a means by which it could provide funds to enable the Farrell side to pay the price of the property.
It was alleged that Mr MacKenzie, Mr Smythe and Quasar procured £300,000 from the Irish Permanent to provide funds to Dr Farrell to allow them pay the Irish Permanent a substantial portion of the purchase price of the property.
The company is seeking the return of the £300,000.
Dr Farrell claims that if expenditure was incurred, which is not admitted, the Irish Permanent through its directors knew and approved or sanctioned such expenditure.
He denies the claim that with the other defendants he procured an agreement that he be paid £300,000 to provide him with funds to buy Grasmere.
He claims the Irish Permanent knew of the arrangements to sell the property to it and lease it back and that the company was aware of the money spent on the property.
Mr Smythe and Quasar deny the Irish Permanent's claims in relation to advice, meetings and agreements to procure funds for the Farrells to purchase their house.
There is a counterclaim on behalf of Quasar and another company, Trivo, which Mr Smythe controlled, for £30,000 in consultancy fees.
Yesterday Mr Gallagher, on behalf of the Irish Permanent, having told the court of a settlement of the action against Mr MacKenzie, said that so far as a counterclaim against the company by Mr MacKenzie was concerned, the parties had reached a satisfactory settlement and the action could be struck out.
Mr James Nugent SC, for Dr Farrell, said this was a development which had taken his side by surprise. It was now faced with proceedings arising out of an agreement which Dr Farrell entered into whereby he was paid £300,000 for entering into a restrictive covenant which would not allow him work for any other company for a year.
That agreement had been negotiated by Mr MacKenzie on behalf of the Irish Permanent. The allegations against Mr MacKenzie and Dr Farrell were almost identical. Mr Nugent said he must know what case was now being made against Dr Farrell.
Mr Gallagher said that the Irish Permanent would provide a fresh statement of claim and provide it to Dr Farrell by today.