The High Court has held Padraig O’Halloran liable for fraudulent misrepresentation and deceit over repeated assurances that the first phase of the Buccament Bay resort in St Vincent and the Grenadines would be completed by 1 July 2010.
In a judgment delivered on 25 July 2013, Mr Justice Brian J McGovern found that O’Halloran made the assurances knowing they were untrue or recklessly as to their truth. Harlequin Property (SVG) Ltd and Harlequin Hotels and Resorts Ltd relied on them and continued making payments to the construction companies controlled by O’Halloran, the court found.
The dispute arose from construction work carried out by the ICE Group at the Caribbean resort. The parties had no written building contract. Harlequin said it paid the group to complete Phase 1, while O’Halloran denied misappropriating money and maintained that payments made for his personal purposes were part of his remuneration or benefited the project.
The court found that substantial work remained when the ICE Group was removed from the site on 11 June 2010, and there was no prospect of meeting the July opening date. It concluded that O’Halloran had kept Harlequin from learning the project’s true progress while seeking further funds. The judgment also found that substantial payments had been diverted to his Irish accounts using false descriptions.
The court did not accept the plaintiffs’ claim that the payments created a Quistclose trust: the money had been advanced for the general purpose of completing Phase 1, rather than for specific identified payments. It also declined to impose a constructive trust over payments made to O’Halloran’s father, Donal O’Halloran. The judge found no evidence that the father knowingly participated in misappropriation and considered that any responsibility should rest with Padraig O’Halloran.
For damages, the judge counted Irish payments from 29 June 2009 to 31 May 2010: US$1.488 million paid to Padraig O’Halloran’s personal accounts, payments to Weddings by Franc connected with a wedding that did not take place, and US$358,000 paid to Donal O’Halloran’s accounts. The damages were assessed at US$1.918 million and €120,000. The court said the dollar amount would be converted at the date of judgment and that counsel would be heard on the precise converted figure before judgment was pronounced. The judgment was against Padraig O’Halloran alone.