A bonded warehouse in Dublin, operated by a company until it went into liquidation last October with alleged debts of £2 million to the Revenue Commissioners, is to be sold following an order of the High Court yesterday.
Mr Justice Kelly varied the terms of an order he made in April last against Mr Joseph McNamara and Mr John McDonnell, directors of Eastland Warehousing Ltd, and HJS Ltd, restraining them from disposing of their assets below £2 million.
Under the varied terms, HJS Ltd is permitted to sell its interest in a warehouse at 3-4 East Road, Dublin, through the sale of the premises at public auction by Druker Fanning Ltd.
Mr Alexander Owens, for the defendants, said he was consenting to the sale by auction but his clients wished the auction to be jointly conducted by Druker Fanning and Sherry Fitzgerald.
Mr Justice Kelly said that would double the cost and directed the auction be conducted by Druker Fanning only.
He said the auctioneer should advise the liquidator of Eastland whether the property should have a reserve and what that should be and whether the sale should be subject to and with the benefit of the existing lease.
He also directed the benefits of the sale, after discharge of encumbrances including taxes payable but not including encumbrances of the defendants, be lodged in court pending further order.
On another application by Mr James Connolly SC, for Mr Tom Kavanagh, one of the joint liquidators of Eastland, the judge said Mr McNamara and Mr McDonnell must comply with an order for discovery of documents made in April last.
Mr Connolly submitted there had not been full disclosure, but this was denied by Mr Owens.
The judge said that, in his April order, he intended there should be full disclosure and the defendants were required to support the documentation furnished with an account of what was going on.
He would not vary his order and would allow 14 days for compliance.
If the defendants felt they wished to invoke the privilege against self-incrimination, they had liberty to come back to court, the judge added.
Mr Connolly said there appeared to be compliance with parts of the order. He said he might bring a motion for further and better discovery regarding another aspect.
At an earlier court hearing, Mr Tom Kavanagh, joint liquidator of Eastland, said in an affidavit that it appeared very large sums of money had been misappropriated over the years by the directors of the company and stored in a secret account in the First National Building Society. He said the account was not made known to the company's auditors.
The liquidators had been informed that Revenue Commissioners and Customs and Excise investigations which were continuing indicated a revenue liability in excess of £2 million.
Last April Mr Justice Kelly granted orders to the liquidators, Mr Kavanagh and Mr Paul Wise, against Eastland's directors - Mr Joseph McNamara, Clonkeen Crescent, Kill of the Grange, Dun Laoghaire, and Mr John McDonnell, Rathbeale Crescent, Swords - and against HJS Ltd, of which Mr McNamara and Mr McDonnell were stated to be directors.
The orders restrained the defendants from reducing their assets in this jurisdiction below £2 million until further order and also from reducing their shares in HJS below £2 million.
The court has heard the joint liquidators were appointed at a meeting of creditors of Eastland Warehousing last October.