The High Court has barred some members of the Kelleher family from removing their brother-in-law, Mr Michael O'Gorman, from the board of directors of Blarney Woollen Mills Ltd.
Mr Justice Carney granted injunctions restraining the company and directors Frank, Pat, Kevin and Ester Kelleher from removing Mr O'Gorman, husband of the company's chief executive, Marian, from the board and replacing him with Esther Kelleher.
He also barred the company from taking any actions through the board as at present purportedly constituted.
Mr Paul Gallagher SC, counsel for Mr O'Gorman, told the court that the purported removal from the board of his client at a meeting on June 30th last was part of a secret agreement by Frank, Pat and Kevin Kelleher to take control of the company and effectively remove Marian O'Gorman, nee Kelleher, as chief executive.
He said a proxy vote relevant to the decision of the meeting had not, in accordance with procedures under the Companies Act, been delivered to the registered office of the company, which turned out to be a furniture trader's premises with which the company severed links 20 years ago.
Mr O'Gorman, of Fernhurst, Tower, Blarney, Co Cork, said the company had a turnover of almost £50 million annually and had major retail outlets at Blarney, Killarney, Dublin and Kilkenny, together with two hotels at Blarney, a mail order business, a knitwear factory in Donegal and various investment properties.
He said Frank, Pat and Kevin were brothers and Esther Kelleher was Frank's wife. Until April last his wife, Marian, owned 25 percent of the 800,000 ordinary £1 shares which comprised the share capital of the company. Pat held 20 per cent, Frank 18.125 per cent, Kevin 18.125 per cent and Paschal Kelleher 0.625 per cent. His sister-in-law, Bernadette Kelleher, held 18.125 per cent.
On April 20th last, his wife transferred 40 per cent of her shareholding to him.
Mr O'Gorman said that over the years there had been considerable tensions at board level within the company arising from disputes between the various family members. His wife was appointed chief executive in 1993 and during her stewardship turnover had grown from £28 million to £42 million and profits had doubled.
In July 1995 her position came up for review and she was re-appointed chief executive for a period of six years, reviewable after three years in 1998.
Differences continued and had polarised himself, his wife and Bernadette on the one hand and Pat, Frank and Kevin, who hold 56.25 of the shares, on the other. The three Kelleher brothers had opposed his wife at every opportunity, forcing her to arrange for her proposals at board level to be tabled by someone else.
They had made an agreement to remove him, appoint Esther and then remove his wife, Marian, as chief executive - three steps which, he claimed, were inextricably interlinked.
Mr Justice Carney held that formalities relating to the lawful removal of Mr O'Gorman and his replacement by Esther Kelleher had not been properly observed.