Sean Dunne initiates New York injunction proceedings against son

A High Court action by businessman Sean Dunne’s Irish bankruptcy trustee concerning a valuable Dublin 4 property may be affected by injunction proceedings initiated in New York by Mr Dunne against his son John Dunne.

It emerged on Friday that Sean Dunne, a witness but not a party to the High Court case, has separately initiated injunction proceedings in New York aimed at restraining John Dunne using funds held by Cypriot registered Yesreb Holdings Ltd, the defendant in the High Court case and a firm of which John Dunne has been described as a director, to settle the High Court proceedings.

Sean Dunne claims the funds at issue belong to his children who are minors and are owned by a trust for those children.

Proceedings

It is believed the injunction matter is due before a New York State Court on Friday afternoon local time.

Separately, in the High Court, Mr Justice Denis McDonald is due next Wednesday to begin hearing proceedings concerning the Shrewsbury Road property, known as Walford.

The High Court proceedings are by Sean Dunne’s Irish bankruptcy trustee Chris Lehane against Yesreb, which the court was previously told bought Walford in 2013 from a trust set up by Mr Dunne for his wife Gayle in 2005.

Walford had been bought in 2005 by Mr Dunne for a record €58 million.

In 2016, Yesreb sold Walford for €14.25 million to Celtic Trustees Ltd, the sole trustee of the Merdon Trust and whose settlor is financier Dermot Desmond.

Mr Lehane’s proceedings against Yesreb, with Celtic Trustees as notice party, concern that 2016 sale of the property.

Mr Dunne was declared bankrupt here and in the US in 2013 over debts of €164 million.

His Irish bankruptcy has been extended for 12 years over failure to co-operate with Mr Lehane.

Mr Lehane claims Mr Dunne had an involvement with Yesreb and Walford must therefore still have had a connection to the family.

The Dunnes initially denied having any connection with Yesreb but later asserted it had been owned by John Dunne, having been gifted to him by Gayle.

When the case was before Mr Justice McDonald this week to deal with two pre trial motions, he adjourned those to Friday after hearing there were some discussions between the sides.

On Friday, one motion, by Yesreb seeking some €553,000 out of monies held in an escrow account, for the purpose of paying legal fees, was adjourned to Tuesday. The second application, by Mr Lehane and Celtic to have certain expert evidence admitted, was not pursued.

Eoin McCullough SC, for Yesreb, told the judge an affidavit provided on Friday morning from Jennifer Fay, solicitor for Mr Lehane, had disclosed “surprising” developments.

In that affidavit, Ms Fay outlined she had been informed on Thursday night that Sean Dunne had initiated injunction proceedings in New York against John Dunne.

Result

Mr McCullough said his side had hoped to have an affidavit from John Dunne on Friday but it now appeared what he would have said had been overtaken by what was said in Ms Fay’s affidavit.

Bernard Dunleavy SC, with Edward Farrelly SC, for Mr Lehane, said the result of the payment out application by Yesreb may have a “significant bearing” on the case.

Discussions are ongoing, he said. If matters are not resolved and the case opens on Wednesday, it is unclear who will give evidence for Yesreb, he added.

It is also unclear whether Sean Dunne, Gayle Killilea and others will come to court to give evidence, he said. Mr Lehane had always believed Sean Dunne was coming to court but, given the events in the US, that is “not now at all clear” whether he can come and give the evidence.

Mr McCullough said his side may be unable to do more than say who they believe will attend. In light of all the circumstances, there may be an application by Yesreb’s lawyers to come off record, he indicated.

Mr Justice McDonald made various directions and returned the matter to next week.