You're reading: Quinns in contempt of court over Ukraina mall

A Dublin court on June 26 said that the now-bankrupt former billionaire Sean Quinn, his son and his nephew were guilty of contempt of court for failing to comply with restraining orders to cease putting assets, including Kyiv’s Ukraina shopping mall, beyond the reach of a state-owned Irish bank to which the family owes more than $3 billion.

Judge Elizabeth Dunne said all three had acted in a “blatantly dishonest and deceitful” manner and were evasive and uncooperative in their evidence to the court, the Irish Times reported on June 26.

She will on June 29 say what their punishment will be, but added that it will depend on the extent to which they cooperate with the bank in relation to the bank taking control of $500 million worth of property assets, including the $78 million Univermag Ukraina shopping center.

She furthermore added that given all the circumstances, it would be difficult to persuade her that there wasn’t a punitive element in their actions.

The High Court of Dublin judge found that despite two restraining orders issued in June and July 2011, the three continued to implement an elaborate scheme to put assets beyond Irish Bank Resolution Corporation. 

IBRC has struggled to claim much of the $500 million of foreign property assets across the globe once owned or controlled by the Quinn family, including the 42,000-square-meter Ukraina shopping mall located on Prospect Peremohy. Since April 2011, IBRC has been losing court battles in Ukraine to take over the lucrative shopping mall. IBRC has been thwarted in Ukraine’s commercial courts by the shopping mall’s former management, allegedly led by Laryssa Yanez Puga, who the bank contends is acting on the behalf of the Quinn family. IBRC has been unable to install its own management team at the shopping center and has faced other lawsuits in Ukraine relating to the validity of a loan agreement and the possession of the actual shares in the mall.

Ireland’s prime minister has taken up the matter with President Viktor Yanukoyvch.
And on June 20, 2012 a high court in Dublin extended orders to freeze the assets owned or controlled by the five adult children of bankrupt Irish businessman Sean Quinn Sr., his nephew Peter Daragh Quinn and two sons-in-law. The Quinn family’s foreign properties were once structured into a Swedish holding company controlled by the adult children of Sean Quinn Sr. 

The bank’s action on June 26 against the three men included the suggestion that they be committed to prison, the Irish Times reported. 

However, the three defendants denied contempt and, although they didn’t deny they had taken steps to put assets beyond IBRC’s reach, and asserted that no steps were taken in pursuit of that scheme after the restraining orders were issued in 2011.

“I am not dishonest,” Quinn Sr. said moments after the ruling outside the courtroom, but would not comment further, the Irish Times reported.

The Dublin court found contempt against Quinn Sr. and his nephew Peter Quinn in their involvement in an alleged fraudulent debt assignment worth 45.2 euros with a view of taking control over Univermag Ukraina.

Earlier, a Kyiv court on May 18 upheld the debt claim by a mysterious British Virgin Islands company over the shopping mall’s management company, despite an Northern Irish court injunction preventing the company from retrieving the debt and rendering the debt assignment invalid.

Peter Quinn, Quinn Sr.’s nephew, gave testimony in Ireland in recent months that he believed both the Quinn Group and the bank had been tricked by the mall’s former management that still controls the shopping center. On March 30, he testified that Yanez Puga was behind Lyndhurst – the British Virgin Islands Company claiming the $45 million debt over the mall’s management company – and that he had trusted her once but not anymore.

Quinn’s nephew also said that at one stage his lawyers and the bank’s lawyers had met at his suggestion, because of his fear that neither side would end up with the shopping center in Kyiv.
IBRC claims the Quinns were still linked with Yanez Puga as early as August, when they allegedly gave her a “golden parachute” payment of $500,000. The Quinns deny the payment was made.

The Kyiv Post has been unable to reach Yanez Puga for comment.

That money remains frozen. 

The judge found contempt against all three in relation to that transaction.

It’s not clear how the rulings will affect court proceedings in Ukraine over the control of Univermag Ukraina, in which IBRC has struggled to gain the upper hand. 

Kyiv Post staff writer Mark Rachkevych can be reached at [email protected].