The High Court has ordered Gayle Dunne to make discovery of documents across 12 categories in proceedings brought by Christopher Lehane, the Official Assignee in the bankruptcy estate of Sean Dunne. The order also covers a thirteenth category in a form redrafted by the court.
The case concerns claims that transfers involving Sean Dunne’s assets, including interests connected to the Lagoon Beach Hotel in South Africa, should be set aside as transactions intended to delay, hinder or defraud creditors. Those claims remain for trial. The judgment dealt only with the Official Assignee’s application for discovery, not the validity of the transfers or the parties’ underlying allegations.
Dunne argued that the discovery request was speculative, that the Official Assignee had not expressly pleaded fraud against her, and that he could obtain documents elsewhere. Justice Costello rejected those objections to discovery in principle. She held that the Official Assignee could pursue a claim based on fraudulent intent inferred from the transactions and their circumstances, without alleging express fraud by Dunne. She also accepted that documents in her possession could be needed for a fair trial, even if some material had been obtained through other routes.
The judge ordered discovery in the categories as sought for documents concerning the alleged 2005 agreement and its alleged performance; tax returns for 2005 to the commencement of proceedings; the 2008 transaction; loans said to have been transferred; transfers involving the hotel-holding companies; and evidence concerning Sean Dunne’s solvency at specified dates. Tax-return details unrelated to the assets in dispute may be redacted.
For category 4, which concerned the alleged transfer of property under the 2005 transaction, the court required documents showing Sean Dunne’s direct or indirect involvement in managing or controlling property the defendant said had been transferred to her, from 2005 onwards. The order also included categories 6, 9, 11 and 12, which the defendant had said she would produce without contest.
The court’s decision does not determine whether the alleged agreements were valid, whether transfers were fraudulent, or whether the bankrupt was insolvent on the dates in question. Those matters remain for the substantive proceedings.