Former Fianna Fáil TD Colm Keaveney, who is being sued by Denis O'Brien, had himself declared bankrupt on Monday to protect his assets from the businessman.
Mr Keaveney, who lost his Galway East seat in the general election and is unemployed, was one of 35 people who applied to the High Court themselves, seeking to be declared bankrupt.
Ms Justice Caroline Costello said Mr Keaveney’s papers were in order and, in a matter of seconds, ruled he was now in the bankruptcy process.
As a result, Mr Keaveney’s assets come under the control and protection of the official assignee, Chris Lehane, and are dealt with according to the terms of the Personal Insolvency Act 2012.
Earlier this year, Mr O’Brien began defamation proceedings against Mr Keaveney in an offshoot action to the one he had taken last October against Dublin public relations consultancy Red Flag.
Illegal conspiracy claim
Mr O’Brien claims Red Flag is at the centre of an illegal conspiracy to damage him and that, as part of that, Mr Keaveney defamed him in a speech, delivered ultimately to the Dáil under protection of parliamentary privilege, but shared beforehand with Red Flag.
Both Red Flag and Mr Keaveney reject the accusations.
Earlier this year, Mr O’Brien demanded that Mr Keaveney apologise in Irish and international media, and threatened to seek exemplary damages against him, describing the speech as intentionally malicious.
Mr Keaveney declined to apologise and instead sought to accelerate the action by demanding Mr O’Brien swear an affidavit and statement of claim within 21 days.
It is understood no statement of claim or affidavit have been received by Mr Keaveney’s side.
Only substantial asset
Mr Keaveney’s only substantial asset is his family home in Tuam where he, his wife and their children live. Mr Keaveney on Monday told friends in Galway that, whatever happened, Mr O’Brien “can’t take away my children’s house”.
Under the bankruptcy process, a person’s affairs while bankrupt are administered by the office of the official assignee. Such assets as can be liquidated are and debts are paid with funds raised. At the end of the process, and on being discharged from bankruptcy, debts left are, in effect, wiped out.
Mr Keaveney’s mortgage is understood to be greater than the estimated value of his house but his advisers believe that such equity as he has in it is now protected should Mr O’Brien persist and win his action for exemplary damages.
Mr Keaveney has sought assistance from the Dáil Committee on Procedures on the basis that standing orders extend to TDs’ papers and not just what is spoken in the Dáil chamber.
