Former local Superintendent among group suing Killally

A former Tullamore Garda superintendent is among a number of investors suing former Offaly Fianna Fáil councillor Gerard Killally, a firm of solicitors and others over an Offaly land deal. Retired Garda superintendent Peter Wheeler, two of his brothers, six other investors and two companies are suing Mr Killally, Bourke & Co solicitors, Walkinstown, a number of financial-advice companies and others over the May 2007 deal. It is alleged that Mr Killally, unknown to the investors, had acquired the lands, some 32.4 acres, at Mount Lucas, Daingean, for some €4.7 million and arranged a scheme under which they were sold to the investors for €10.6 million in May 2007. The case against auctioneer Ger Killally, a Dublin law firm and other financial advisers is claiming damages for a failure to disclose the true nature of the deals. The action opened this week before Mr Justice Michael Peart and is listed to last three weeks. At the outset of the action, the judge was told Mr Killally had been declared bankrupt since the case was initiated and the official assignee in bankruptcy would not be participating in the case. A motion for judgment in default of defence was to be brought against Mr Killally, it was stated. The other defendants have denied the claims against them. It is claimed Mr Killally represented to investors the lands were available for sale for some €10.4 million from Frank Mulligan (father-in-law of Mr Killally) and Mr Mulligan's partners and that Mr Killally was a co-investor. Ronan Murphy SC, for the plaintiffs, claimed Mr Killally was in fact setting up a scheme to buy the lands from Mr Mulligan and partners for some €4.7 million and sell them on for twice the price to a group of people of which he purported to be a part. Some €10.4 million was sought for lands from both the investors and the Educational Building Society when the lands were apparently sold for €4.7 million, itself an inflated figure as valuation evidence indicated the true value of what was sold was €3.25 million, Mr Murphy said. The lands were ultimately sold to the investors in May 2007 for €10.6 million. He added that it was his case that the solicitors acting in relation to the deal – Bourke & Company, Walkinstown, Dublin – had grave concerns about whether those deposits were real but had not advised the investors of this. Mr Murphy said a memo discovered by the solicitors firm for the action, dated March 8th, 2007, appeared to be an aide-memoire to someone in the firm concerning the Mount Lucas lands. It included the words: “Is the sale of three sites a scam and do the consortium know?†and also stated: “If they don't know, GK will . . . on this.†Mr Murphy said the word “will†in that sentence was followed by a word which was either “lie†or “die†but he could not make it out. While the solicitors were not accused of fraud, he said there was also other evidence that they should have had major concerns about the transactions and failed in their duty to inform investors. On Wednesday, Mr Wheeler denied suggestions by Mark Connaughton, for Bourke & Co solicitors, Drimnagh Road, Walkinstown, that he knew prior to the May 2007 sale that Mr Killally had a beneficial interest in the lands. Mr Connaughton suggested the purpose of the investors was to get planning permission for the bulk of the lands, that they knew Mr Killally was a Fianna Fáil councillor likely to get permission and the lands would be flipped quickly. Counsel suggested the plaintiffs' papers suggested they were “salivating at the prospect of turning over a quick buck†on a property with development potential. Mr Wheeler denied that and said he was told by Mr Killally and others there was some €4.5 million in unconditional contracts for sale of part of the lands and the investors would have the option to sell additional sites or sell or develop the remaining lands. The investors always intended to close the alleged contracts for sale of individual sites, he said. If someone wanted to buy the rest of the site, then “happy daysâ€. He disagreed the value of the site lay in the planning permission obtained in February 2007. He disagreed that the value of the site lay in the planning permission that was obtained in February 2007. Mr Wheeler said John Bourke was introduced by Mr Killally to him and other investors at a meeting in March 2007 as their solicitor in relation to the deal. He denied a suggestion by Mr Connaughton that he was wrong about Mr Bourke being solicitor for the investors. He agreed that he had never contacted Mr Bourke after that March meeting about the land deal. The case continues.