US lawyers for the National Asset Management Agency have claimed a challenge by former property tycoon Sean Dunne and his wife Gayle Killilea to dismiss its lawsuit was an attempt to make a “complex web” of fraudulent transactions look “very innocuous and mundane”.
The couple are seeking to have the State agency’s lawsuit against them in the Superior Court of Connecticut thrown out, arguing that Nama has no jurisdiction to take an action in the US court to overturn the transfer of a half-share in an apartment in Geneva, Switzerland from Mr Dunne to his wife.
In the third court appearance in an increasingly bitter dispute, Judge Barbara Brazzel- Massaro directed that Nama chief executive Brendan McDonagh swear a statement and be questioned by lawyers acting for the couple at a private deposition.
Sitting in the Superior Court in Stamford, the judge left it up to both sides to decide on a date for Mr McDonagh’s deposition. She directed that another manager at Nama, John Coleman, be questioned by the couple’s lawyers under oath at an eight-hour sitting next month.
One of the agency’s top 50 debtors, Mr Dunne, who personally owes Nama €185 million, and his wife, who now live in nearby Greenwich, Connecticut, are seeking information from Mr McDonagh about the agency’s view of Mr Dunne’s business plan and its decision to take enforcement action against him.
The court heard that Nama would seek details of further property deals - in Rye, New York, which it believes was also fraudulently transferred – and in Ireland, in addition to the transaction in Switzerland and three property deals in Connecticut at the centre of its lawsuit taken in July 2012.
Before the hearing, Ms Killilea’s attorney Philip Russell told reporters that she was considering legal action, in Ireland or the US, over what he claimed was “vexatious” litigation against his client.
He said Nama’s lawyers had told them that one of its former managers, Kevin Nowlan, would be most familiar with Mr Dunne’s dealings with the agency but when he was questioned by the couple’s lawyers under oath last Friday, he didn’t know of any fact to support a claim against Ms Killilea.
Nama’s lawyers told the court that they should be entitled to the details of any agreement between Mr Dunne and his wife over money transfers and that the Geneva transfer was “one piece of the puzzle.”
Attorney Thomas Rechin, for Nama, said the State agency should be able to discover details of property transfers in Connecticut, Switzerland and other deals in New York and Ireland to prove its case that Mr Dunne was “hiding assets” from creditors by transferring properties and money to his wife and family members. Nama is entitled to know where Ms Killilea “got her money from,” he said.
“We have got to chase the money; we have got to follow the stream of cash,” he told the judge.
In a dispute over the discovery of documents, Mr Rechin sad that Nama had been “completely stonewalled” by the Dunnes and that the couple’s attempts to depose Mr McDonagh and two other Nama executives rather than to seek detailed discovery was a “shot in the dark”.
On the couple’s challenge to the US court’s jurisdiction, Mr Rechin claimed that their application was intended to break the case down into “itty-bitty pieces” by forcing Nama to take separate legal actions in each country where transfers took place to make the action “much less troublesome for them.”
Peter Nollin, Mr Dunne’s lawyer, argued in court that he didn’t know under what common law jurisdiction Nama was pursuing its case: “Switzerland, Ireland, Sesame Street – I am not sure where.”
