BAILII is celebrating 24 years of free online access to the law! Would you consider making a contribution?
No donation is too small. If every visitor before 31 December gives just £1, it will have a significant impact on BAILII's ability to continue providing free access to the law.
Thank you very much for your support!

1. Dunleckney Limited (in liquidation) ("the Company") was struck off the Register of Companies on the 6th November, 1990. The last annual returns for the Company were filed in 1982 made up to the 14th August, 1981. On the petition of the Revenue Commissioners the Company was restored to the register on the 21st October, 1991 and a winding-up of the Company was ordered on the same date. Frank Wallace ("the Official Liquidator") was appointed Official Liquidator. Patrick Keenan (now deceased) and John Keenan as directors were ordered to file a Statement of Affairs within three weeks. In accordance with Section 311(8) of the Companies Act, 1963 it was ordered that upon an office copy of the Order being delivered to the Registrar of Companies for registration, the Company was to be deemed to have continued in existence as if its name had not been struck off.

2. The office copy of the Order was sent to the Companies Office on the 6th January, 1992 and returned receipted on the 7th January, 1992.

3. The Company had sold 240 acres of land on the 21st May, 1979 and incurred substantial corporation tax liability amounting to £118,163.25. The net proceeds of sale were £796,500. The Company made an advance to its parent company, Keenan Brothers Holdings Limited, of £725,000 and to its fellow subsidiaries within the Keenan Group of £40,047. The parent company, Keenan Brothers Holdings Limited, was wound-up on the 21st December, 1991. At the date of liquidation the Company was the registered owner of the lands comprised in Folio 2750 F County Carlow, let on conacre at £5,000 per annum which was paid to the Company's Solicitors from 1984. They held £12,785 on behalf of the Company on the date of liquidation. The Solicitors had paid the sum of £1,475 to each of the Directors on the 8th August, 1984. They paid the sum of £1,500 each to Mr. John Keenan and the widow of Patrick Keenan on the 24th February, 1988. This money was never repaid to the Company. No explanation was given by John Keenan.

4. The lands in Folio 2750F County Carlow were sold by the Official Liquidator in the winding-up for a total sum of £85,000.

5. The Official Liquidator ascertained from Mr. Bernard Somes, the Official Liquidator of Keenan Brothers Limited (liquidated on 21st January, 1993) that there were no further assets available for distribution.

6. The Official Liquidator says it appears that no books or records were maintained and that apart from the payments from the rental income in 1984 and 1989, his investigation did not reveal any items upon which in his opinion a Statement of Affairs would reveal any information which is not already available.

7. Mr. Keenan in his Affidavit claims that despite the fact that the Company was "re-listed" on the 21st October, 1991 that no entitlement exists under the legislation to effect the Orders sought because the provisions of Section 150 are not retrospective.

8. The Companies Act, 1990 was enacted on the 22nd December, 1990 and Part 7 (Sections 149-169) came into operation on the 1st August, 1991 (S.I. 117 of 1991).

9. The points which arise in this matter are:-

10. Therefore when the office copy was lodged on the 6th December, 1992, the Company was deemed to have continued in existence. It follows since the Company is deemed to have continued in existence, Part 7 applies to the Company because that part came into operation on the 1st August, 1991 and the Company was not wound-up until the 21st October, 1991. It was therefore a company in existence at the time Part 7 came into operation. Since it is a company which at the date of the commencement of the winding-up Order was unable to pay its debts, Section 149 applies. John Keenan was a Director during the 12 months prior to the commencement of the winding-up and the chapter applies. Under Section 150 the Court must be satisfied that a Director to whom Section 149 applies "has acted honestly and responsibly in relation to the conduct of the affairs of the company and that there is no other reason why it would be just and equitable that he should be subject to the restrictions imposed by the section".

11. It seems to me that the same principles outlined in that case apply to Section 150 so that it is the conduct of the affairs of the Company after the coming into operation of Part 7 which must be looked at to determine whether the Directors acted honestly and responsibly in relation to the affairs of the Company and not to conduct prior to that date. (That is not to say that the Court cannot look at the background information provided by actions and events prior to the coming into operation of Part 7 to explain matters arising after the operative date.) The relevant period to look at actions in respect of conduct of the affairs of this company was from the 1st August, 1991 to 21st October, 1991. Mr. Keenan did not act at all in relation to the affairs of the Company during that period therefore the first aspect of the Directors conduct does not arise.

12. The question of whether there is any other reason allows the Court to look at Mr. Keenan's conduct after the winding-up to determine whether it would be just and equitable that John Keenan should be subject to the restrictions under the section. It is a fact that he failed to file a Statement of Affairs despite his statutory obligation to do so. I know the Official Liquidator says he co-operated and does not think that a Statement of Affairs would reveal any information not already available. But in his Replying Affidavit Mr. Keenan gives no explanation as to why he failed to fulfil his statutory obligation. In my opinion it is not for the Official Liquidator to excuse a director from his statutory obligation.

13. There is the matter of the payment of the £1,750 and the £1,500 out of Company funds. While this occurred prior to the relevant date of the 1st August, 1991, the money appears to be a debt due to the Company with a continuing obligation. No explanation is given by Mr. Keenan as to why he failed to repay any part of this sum. However, this is a matter for the Official Liquidator to pursue.

14. I am satisfied that the failure to fulfil his statutory obligation by filing a Statement of Affairs and the failure to explain why, is sufficient reason to make the declaration under Section 150 of the Companies Act, 1990 that he should not for a period of five years be appointed or act in any way, whether directly or indirectly, as a Director or Secretary or be concerned with or take part in the promotion or formation of any company unless that company meets the requirements set out in Sub-section (3) of Section 150 of the Companies Act, 1990.