US court hears ‘tentative’ deal agreed to resolve Dunne bankruptcy
Posted on 25th August 2020 at 22:08
Deal would cover developer’s ex-wife Gayle Killilea and her business entities
A lawyer representing Gayle Killilea, ex-wife of onetime Celtic Tiger tycoon Seán Dunne, said on Tuesday that there is “a tentative agreement” to resolve her part of Dunne’s years-long US bankruptcy.
Peter Nolin, who represents Ms Killilea, said he and Mr Dunne’s American bankruptcy trustee have been in intense negotiations for months. “I work on it every single week, sometimes every day,” Mr Nolin said.
Mr Nolin offered no specifics on the tentative deal, which he said would cover Ms Killilea and her business entities, or a timeline for its finalisation.
“I can’t discuss what’s being discussed, but I can say they are working on it and we are working on it,” Mr Nolin said. “There are many moving parts because there are a lot of different parties and entities. I can’t really say how close we are. I hope we are close.”
Timothy Miltenberger, a lawyer representing Mr Dunne’s bankruptcy trustee, did not return a call seeking comment. Mr Dunne’s US lawyer, Luke McGrath, likewise did not respond to attempts to contact him.
News of a possible deal comes 14 months after a US jury found Mr Dunne had fraudulently transferred millions of euro in assets to Ms Killilea to shield them from creditors, and ordered her to surrender €18.1 million to the trustee. The two sides have been in settlement talks for nearly a year, while occasionally skirmishing in court.
Mr Dunne has sued to prevent the use of proceeds from the sale of Walford, Ireland’s most expensive home, in any agreement. His lawsuit is still pending.
Mr Nolin made his comments following a short hearing on Tuesday in US bankruptcy court in Connecticut at which the trustee asked chief judge Julie Manning to affirm his legal possession of $12.5 million (€10.5 million) from the sale of Walford.
The trustee asked the judge to rule in his favour because Yesreb, a Cypriot entity created to hold the property and controlled by John Dunne, Seán Dunne’s son from his first marriage, never responded to his lawsuit, a separate action originally filed in March.
The judge, however, declined to rule, saying the judge in Dunne’s bankruptcy trial needed to first rule on a motion to have him preside over the matter.
Mr Nolin, who also represents John Dunne, said he was “shocked and outraged” by the trustee’s actions, saying he never properly noticed him, John Dunne or Yesreb that they were seeking a ruling on the case. They thought the suit was in hibernation and would have moved to defend themselves if they had known the case was live, Mr Nolin said.
This latest action brought by the trustee, whose job is to distribute Seán Dunne’s remaining assets to creditors, concerns $12.5 million in proceeds from the sale of Walford by Yesreb to Celtic Trustees Ltd, owned by businessman Dermot Desmond. Per a negotiated agreement, Celtic Trustees put the money in the trustee’s escrow account earlier this year.
On the same day in 2013 that Seán Dunne declared bankruptcy in the US, where he was living at the time, Walford was transferred for no money to Yesreb. The transfer was intended to protect the home, which Sean Dunne bought for €58 million in 2005, from creditors, according to evidence presented at trial.
Celtic Trustees agreed to buy it for €14.5 million in 2016, but a court froze the funds because of Seán Dunne’s ongoing bankruptcy litigation.
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