The Supreme Court has dismissed an appeal by Sean Dunne against the High Court’s decision to refuse to annul his Irish bankruptcy adjudication. The court held that a prior Chapter 7 bankruptcy in the United States did not, by itself, prevent an Irish court from adjudicating him bankrupt.
Ulster Bank Ireland Limited petitioned the High Court on 12 February 2013, claiming that Mr Dunne owed it €164,586,493.05 plus continuing interest and costs under a High Court judgment. The bank also relied on an execution order returned by the Dublin sheriff marked “No Goods – Nulla Bona”. Mr Dunne filed for Chapter 7 bankruptcy in Connecticut on 29 March 2013, after the Irish petition had been presented.
The US Bankruptcy Court later modified its automatic stay to allow the Irish petition to proceed. On 29 July 2013, the High Court adjudicated Mr Dunne bankrupt. He applied to show cause against the validity of that adjudication, arguing, among other things, that a second bankruptcy was impermissible, that he was not domiciled in Ireland, and that the petition had not been properly served. The High Court dismissed his application in December 2013.
In the Supreme Court, Justice Laffoy said the Bankruptcy Act 1988 did not exclude the High Court’s power to make an adjudication solely because a foreign court had already adjudicated the debtor bankrupt. The Irish court had jurisdiction to hear the petition, subject to the bank meeting statutory and procedural requirements. The judgment did not determine how the Irish and US bankruptcy proceedings should operate alongside one another, or how assets should be administered.
The court did not need to decide the domicile issue. Mr Dunne had not appealed other High Court findings that he met alternative statutory criteria concerning residence, a dwelling house, or business in Ireland within the relevant three-year period. Those unchallenged findings meant the statutory requirements were met regardless of domicile.
On service, the Supreme Court found that the petition had not been served at least seven days before the hearing as required by the rules. However, it held that the High Court was entitled to treat the service actually effected as sufficient. The petition and hearing date had been brought to Mr Dunne’s attention, and the court found he suffered no prejudice because he later had the opportunity to challenge the adjudication in the High Court and on appeal.
The Supreme Court dismissed the appeal. It expressed no view on the future conduct of the concurrent bankruptcy proceedings.