THE HIGH COURT has ordered the winding up of Dublin law firm Seán Ó Ceallaigh & Co, after one of its partners allegedly used almost €2.5 million of client money to gamble on stocks and shares.
President of the High Court Mr Justice Nicholas Kearns said he was making the winding up order given the “very serious fraud” involved and a report questioning the firm’s future viability proposals. He also directed the papers in the case be referred to the DPP.
Last month, the court suspended the practising certificate of Ruairí Ó Ceallaigh, one of the partners in the firm, based in Phibsboro, Dublin, after being told he had admitted gambling €2.5 million in client money, half of which had been bequeathed by a deceased man to the Catholic archbishop of Dublin.
The court heard then the firm’s liabilities might exceed €4.2 million, but yesterday it was told the figure could be €5.85 million.
Mr Ó Ceallaigh, son of retired solicitor Seán Ó Ceallaigh (79), who founded the firm more than 50 years ago, was allegedly involved in the double mortgaging of four properties, the court was told.
His brother and partner in the firm, Cormac Ó Ceallaigh (37), had allegedly given undertakings to a bank that its charge over the properties would be secured, it was also stated.
After the High Court froze the firm’s assets last month, accountant David Rowe of the firm Outsource, was asked to assess the viability of proposals advanced with a view to ensuring the practice, which employs 12 people, could continue to operate.
Mr Justice Kearns said he had no choice but to grant the Law Society an order winding up the firm after receiving the accountant’s viability report and in light of the “very serious fraud” in this case.
In his report, Mr Rowe described the original survival proposals advanced by the practice as overly optimistic and expressed the view they would not generate sufficient income to repay the firm’s liabilities.
Among those proposals was for the archbishop of Dublin to be given the deeds of a property at Grand Canal Street, Dublin, to sell to reduce the debt owed to him.
It was also proposed, subject to the firm being allowed to continue to trade under the sole stewardship of Cormac Ó Ceallaigh, that his parents – Seán and Pauline Ó Ceallaigh – would sell the family home at Ros na Rí, Castleknock, Dublin, in an effort to cover any shortfall from the sale of the Grand Canal Street premises.
The proposals also provided for an arrangement with three financial institutions, all owed money as a result of Ruairí Ó Ceallaigh’s alleged double mortgaging of properties, to set up a 20-year mortgage to repay debts, which would be funded from cash flows from the continued trading of the firm.
The court heard yesterday that Mr Rowe had received revised proposals on October 19th but regarded some of those as even weaker than the original proposals.
Mr Justice Kearns, who stressed there was no suggestion that Seán Ó Ceallaigh, the firm’s founder, had acted in anything but an honourable manner, said he agreed with Mr Rowe that the new proposals did not even address, let alone surmount, the problems in this case.
He ordered that the firm be wound up and its files be transferred to the Law Society. He also directed that Ruairí Ó Ceallaigh remain suspended pending further disciplinary action by the Law Society.
The judge was told yesterday the society was not seeking to have Cormac Ó Ceallaigh suspended from practice, but he may face disciplinary proceedings over alleged lack of supervision of his own firm.