The High Court has refused the surviving partners’ application to freeze €1.3 million paid under a life insurance policy on the life of their late business partner. The court found a serious question to be tried over whether the money belonged beneficially to the Renmore Partnership or to the deceased’s estate, but held there was no evidence it was at risk of being removed or dissipated.
The ruling, delivered by Ms Justice Laffoy on 6 September 2013, concerned an interim application in proceedings under the Partnership Act 1890. The plaintiffs, Paul Cullinan and John Cullinan, sought to prevent Brendan Keogh, sued as personal representative of the deceased, from dealing with the policy proceeds, or alternatively to have the money lodged in court.
The dispute arose from a family business and the Renmore Partnership, formed in 1998 to invest in and deal with property. The deceased, Geraldine Cullinan, died in October 2011. Irish Life paid €1.3 million to Keogh as executor after probate was granted in May 2012.
The plaintiffs argue that the partnership beneficially owns the proceeds and that the money should be used in connection with buying the deceased’s partnership share. Keogh says the proceeds belong to her estate. The judge stressed that the application did not determine that ownership dispute. She said the evidence about what the partners intended when they arranged the Irish Life policies in 2005 was inadequate; if the dispute proceeds, the agreement may need to be determined on oral evidence.
The parties’ 2006 partnership agreement included provisions addressing life cover and the purchase of a deceased partner’s share. But the judge said the documents raised questions about how those provisions applied to the Irish Life policies. The policies’ premiums had been paid from the partnership’s bank account, while the policy schedule did not state that the partnership owned the plan. The judge also noted broader disputes between the parties but found no ulterior motive or abuse of process had been established in bringing this claim.
For interim relief, the court considered whether damages could adequately compensate the plaintiffs if they later succeeded, and whether there were grounds to believe the money would be dissipated. The judge concluded that an award of damages would be adequate and that there was no evidence suggesting Keogh would fail to preserve the money for the estate’s proper administration. She therefore refused the injunction and dismissed the application. The court made no final determination on ownership and did not need to decide whether delay should also bar interim relief.
The judge observed that any unlawful dissipation could expose Keogh to personal liability if the plaintiffs ultimately established an entitlement. She encouraged the parties to reconsider alternative dispute resolution to resolve their wider disputes.