High Court of Ireland Decisions

THE HIGH COURT

BANKRUPTCY

[2023] IEHC 55

IN THE MATTER OF SECTION 85A OF THE BANKRUPTCY ACT 1988 AS AMENDED

 

IN THE MATTER OF KENNETH JOYCE, A BANKRUPT - 5403

 

 

JUDGMENT of Mr Justice Mark Sanfey delivered on the 3^rd day of February 2023.

 

1.                  This judgment concerns two applications: firstly, an application by the Official Assignee in Bankruptcy (‘the Official Assignee’ or ‘the OA’) for an order extending the bankruptcy of Kenneth Joyce (‘the bankrupt’) from the date of adjudication pursuant to s.85A(4) of the Bankruptcy Act 1988 as amended (‘the Act’), on the basis that the bankrupt has failed to cooperate with the Official Assignee in the realisation of his assets, or hidden from or failed to disclose to the Official Assignee income or assets which could be realised for the benefit of the creditors of the bankrupt. Secondly, the bankrupt, in response to the OA’s motion, issued his own motion on 18 November 2022 for a number of reliefs, including an order for discovery in respect of correspondence relating to in-camera documents which the bankrupt alleged were exhibited by the OA in his grounding affidavit, and which documents the bankrupt alleged were concerned with family law proceedings in which the bankrupt is engaged with his ex-wife. The bankrupt ultimately accepted, in a hearing before me, that he was not entitled to most of the reliefs he sought. In this judgment, I will address the bankrupt’s motion after consideration of the OA’s motion, with which the hearing was mainly concerned.

The section 85A application

2.                  By notice of motion issued on 11 November 2022, the OA applied for reliefs in relation to the bankrupt pursuant to s.85A of the Act as amended. The bankrupt had been adjudicated as such on 23 November 2021. The OA’s motion was returnable before the court on 21 November 2022. Section 85A (1) requires that an application by the OA under that section be made “prior to the discharge of a bankrupt pursuant to s.85…”. The OA therefore sought an order pursuant to s.85A (3) of the Act “…that the matters complained of by the applicant under sub. (1) be further investigated and pending the making of a determination of the application the bankruptcy shall not stand discharged by virtue of s.85”. An order to this effect was granted by this Court on 21 November 2022.

3.                  Section 85A (4) requires that the court be satisfied that the bankrupt has

“(a) failed to cooperate with the Official Assignee in the realisation of the assets of the bankrupt, or

(b) hidden from or failed to disclose to the Official Assignee income or assets which could be realised for the benefit of the creditors of the bankrupt…”.

4.                  If the court is so satisfied, the court “…may, where it considers just to do so, order that, in place of the discharge provided for in s.85, the bankruptcy shall stand discharged on such later date -

(i) being not later than the eighth anniversary of the date of the making of the adjudication order, as the court considers just, or

(ii) being not later than the fifteenth anniversary of the date of the making of the adjudication order, which the court considers just in view of the seriousness of the failure to cooperate referred to in paragraph (a) or the extent to which income or assets referred to in paragraph (b) were hidden or not disclosed, or both, as the case may be.”

5.                  Pursuant to s.85A (5), the court may make only one order under sub-section (4). A further application may not be made by the OA, even where there is subsequent non-cooperation by the bankrupt.

6.                  In support of the motion, an affidavit of Michael Ian Larkin, the Official Assignee, was sworn on 10 November 2022. Mr Larkin swore a supplemental affidavit on 11 January 2023, primarily to address communications received from the bankrupt in response to the OA’s motion. An affidavit was also sworn by Ray Kelliher, a partner in the firm of solicitors representing the OA, on 13 January 2023. The purpose of Mr Kelliher’s affidavit was to exhibit a corporate search obtained by the OA in respect of a company in Thailand which is relevant to the ownership of an asset either owned or formerly owned by the bankrupt.

7.                  The bankrupt did not swear any replying affidavit in respect of the OA’s application. However, when the issue of the interim extension pursuant to s.85A (3) came before me on 21 November 2022, I explained to the bankrupt that one of the purposes of granting an interim extension of the bankruptcy was to allow the bankrupt an opportunity to remedy any deficiencies of cooperation which there may have been prior to the first anniversary of his adjudication. I emphasised that it was in the interests of the bankrupt to satisfy the OA that he had cooperated fully, and the extent to which he had done so would ultimately be a factor taken into account by the court in considering the issue of an extension under s.85A(4).

8.                  Accordingly, the bankrupt communicated with the OA, and did so again in January 2023 by providing information and documentation which the bankrupt considered relevant to the issues raised by the OA. Although this material was not set out on affidavit, I have taken account of all such communications and documentation for the purpose of the OA’s application.

9.                  The OA’s application under s.85A (4) was heard by me on 23 January 2023. The OA was represented by counsel, and written submissions were delivered in advance of the application. The bankrupt has on all occasions before this Court represented himself.

Background

10.              The bankrupt was adjudicated bankrupt by order of this Court on 23 November 2021 on foot of the petition of Emmet Kilduff. On 5 January 2022, the bankrupt provided a draft statement of affairs to the Insolvency Service of Ireland (‘the ISI’). After some contact with the Bankruptcy Compliance and Enforcement Team of the ISI, the bankrupt provided on 7 January 2022 an amended version of the draft statement of affairs as a final version. The bankrupt also provided a statement of personal information on that date.

11.              The OA points to a “significant difference” between the draft statement of affairs and the statement of affairs of 7 January 2022 in relation to the unsecured creditors listed by the bankrupt. The draft statement of affairs lists in excess of eighteen creditors, whereas the statement of affairs ultimately submitted lists 7 creditors only.

12.              On being queried by the ISI in relation to this discrepancy, the bankrupt advised that “many of the [debts] go back over twenty years and were never my responsibility to pay in the first place. As such, I understand they are now ‘statute barred’ so those were removed”. On receipt of this response, the ISI raised further queries in relation to whether the removed creditors had sought to recover the debts in recent years, and the basis for the bankrupt’s assertion that they were not his responsibility to pay. This issue has been pursued in correspondence by the OA’s staff, the most recent query being on 28 October 2022. The OA is dissatisfied with the responses of the bankrupt on this issue.

13.              The bankrupt listed his general assets in the statement of affairs, and estimated the total current value of them at €6,000. This related to assets such as a car, work related equipment, artwork, furniture and childrens’ bikes, trampoline and treehouse. The bankrupt, by email of 1 February 2022, stated that during his eviction from his home he was prevented by the landlord from removing many of his assets which he advised could have been realised for the estate of the bankrupt. In a subsequent email of 15 March 2022, the bankrupt reiterated that these assets were “certainly not in excess of €6,000”. In an email of 20 September 2022 to the OA, the bankrupt sought an update from the OA’s office in relation to his estate, and stated inter alia that “a figure (circa €50k) should have been established as to the value of all my personal effects, artwork, furniture etc which were illegally seized by Kilduff and this figure should have been offset against the rent due of circa €25k”. However, under cover of an email of 4 November 2022, the bankrupt furnished a schedule of “possessions seized on 10 January 2022” from the property from which he was evicted which detailed, over four pages, assets from the property with an ascribed value of €141,890. No vouching documentation was provided for any of the estimated values.

14.              In his statement of affairs, the bankrupt lists a one-hundred percent shareholding which he holds in Gravity Electricity Limited. By email of 4 February 2022, the bankrupt wrote to the Bankruptcy Compliance and Enforcement Team of the ISI stating that he had written to the court seeking agreement to remain as a director of that company. The bankrupt was subsequently notified by the ISI on 17 February 2022 that, under the Companies Acts, a bankrupt could not operate as a director of a company without obtaining leave of the court. The bankrupt was subsequently advised by the ISI that any application for leave to be permitted to act as a director should be made to the court on notice to the ISI and to the Director of Corporate Enforcement. In correspondence during the course of 2022, the ISI continued to press the bankrupt as to what steps he was taking to regularise his position. By an email of 19 August 2022, the bankrupt maintained that he had applied to the court “for leave of the court to remain as a director until such time as I am released from bankruptcy”. It does not appear however that the bankrupt has ever brought an application before the court on notice to the appropriate parties in this regard; neither has the bankrupt resigned from his company directorship.

15.              Perhaps the most substantial issue in the application relates to a property in Hua Thanon, Koh Samui, Thailand. In the statement of affairs, the bankrupt lists a one-eighth share in a timeshare rental property in Thailand (‘the Thai property’) as having a current estimated value of €60,000 and a mortgage amount owing of €80,000, with a consequent negative estimated value of €20,000. He confirms in the statement of affairs that the Thai property is derelict, unoccupied and is not being rented. By email of 15 April 2022, the bankrupt stated that the property “was transferred to my wife in circa 2012…” although it was asserted in the same email that the bankrupt had disposed of the Thai property at some point for a sum of €10,000, with a verbal undertaking of “two weeks per year timeshare for me to use the property”.

16.              However, the OA has exhibited an email of 15 August 2013 from Mr Joyce in which he attributes a value of €700,000 at least to the property. Internet searches made in November 2022 and exhibited by the OA show the Thai property to be listed for rental at $775 - $1,605 per night’s stay. The company search exhibited to Mr Kelliher’s affidavit states that there is only one director of the company Ka-Nit Limited which owns the Thai property, and that is the bankrupt. The company search states that there have been no other changes of directors of the company since the bankrupt was appointed as sole director of the company on 23 January 2008. It is stated that the company’s constitutional documents indicate that, as regards “authorised signatories” … “one director shall sign and affix the company’s seal”. The search states that the 11,698 shares held by the bankrupt were transferred to a company incorporated in the British Virgin Islands on 10 March 2021. While it does not appear therefore that the bankrupt retains any shares in Ka-Nit Limited, the company search states that the Articles of Association of the company provide that “…in a Board of Director’s meeting, the majority of all members shall attend to form quorum, and the resolution can only be passed upon approval of the majority of the attending directors”.

17.              While the bankrupt did not reply by way of affidavit to the OA’s application and the various issues raised therein, he did respond to various specific queries raised by the OA, particularly in letters of 18 November 2022 and 23 November 2022. By a letter of 7 January 2023, the bankrupt addressed the issues of his failure to resign as a director of Gravity Electricity Limited, and the issue of the removal of creditors from his statement of affairs. By a letter of 9 January 2023, the bankrupt gave a detailed response to the queries raised by the OA in relation to the Thai property, and furnished some supporting documentation, including a number of photographs taken in January 2020 purporting to show that the Thai property was at that time in fact derelict as he alleged.  

18.              In advance of the s.85A (4) application, the bankrupt on a number of occasions before the court referred to family law proceedings with his ex-wife. He expressed concern that in-camera documentation was being passed to the Official Assignee by his ex-wife. Certain allegations were made against that party, and unfortunately it is clear that relations between the bankrupt and his ex-wife are marked by rancour and discord. The bankrupt made it clear that he regards his failure to obtain a discharge from bankruptcy as an obstacle to resolution of issues in the family law proceedings, particularly with regard to his children, and also to his being able to obtain employment. It was clear from various appearances of the bankrupt before me that he is -  as he acknowledges himself - under considerable stress, and most anxious to secure the earliest possible discharge from his bankruptcy.

The issues

19.              In a letter of 28 October 2022 to the bankrupt, the OA’s solicitors set out the four issues in respect of which the OA contends that the bankrupt has “failed to provide satisfactory responses/information in respect of several queries raised by this office and the office of the Official Assignee…”. Those issues may be described as

(1)        the Thai property issue;

(2)        the issue relating to the removal of creditors from the draft statement of affairs;

(3)        the details in relation to the assets or belongings which the bankrupt contends he was prevented from removing from the former family home, and in respect of which the bankrupt has given a number of different valuations; and

(4)        the alleged failure of the bankrupt to resign from his position as director of Gravity Electricity Limited.

20.              These four issues, and the relevant points in relation to same from the OA’s perspective, are summarised at para. 11 of the written submissions proffered by the Official Assignee.

21.              There is in fact a fifth issue. In his affidavit of 11 January 2023, the OA refers to a letter written by his office to the bankrupt on 10 November 2022. That letter stated that the ISI had been informed of the death of the bankrupt’s father Val Joyce. The letter went on to state - incorrectly - that the demise of the bankrupt’s father “…may impact the administration of your bankruptcy estate as any property which is acquired by or devolves on a bankrupt before discharge vests in the Official Assignee, this includes any amounts under an inheritance”. In fact, s.44(5) of the Bankruptcy Act 1988 makes it clear that, with certain exceptions set out in that subsection, “…property which is acquired by or devolves on a bankrupt before the discharge or annulment of the adjudication order (in this Act called ‘after-acquired property’) shall vest in the Official Assignee if and when he claims it”. Property acquired by or devolving on a bankrupt after adjudication but before discharge does not therefore automatically vest in the Official Assignee, who must claim such property for that to occur.

22.              However, the letter required the bankrupt to provide the OA’s office with “contact details of persons responsible for the administration of your late father’s estate and details of any inheritance that was due to you”. The OA requires this information in order to decide whether there is property which may devolve upon or be acquired by the bankrupt from the estate of his late father prior to discharge, and whether that should be claimed by the OA for the benefit of the bankrupt’s creditors.

23.              It is not disputed that the bankrupt has not responded to this letter. At the hearing of the s.85(4) application, the bankrupt indicated to the court that he was not aware of the exact position regarding his late father’s estate, or whether there was any value in it.

 

The legal position

24.              For an order pursuant to s.85A (4) to be made, the court must be satisfied that the bankrupt has

“(a) failed to cooperate with the Official Assignee in the realisation of the assets of the bankrupt, or

(b) hidden from or failed to disclose to the Official Assignee income or assets

which could be realised for the benefit of the creditors of the bankrupt…”

25.              It is clear that there are two distinct criteria for extension. As the OA points out in his written submissions, the first relates to cooperation and “the assets of the bankrupt”; the second relates to a failure to disclose income or assets “which could be realised for the benefit of the creditors”. In Re Seán Dunne (A Bankrupt) [2018] IEHC 813, the bankrupt sought to argue that the imposition of punitive sanctions for the failure to disclose assets which “could be realised” for the benefit of creditors demanded the identification by the Official Assignee of assets which could in fact be realised, and submitted that if an asset was to be realisable, it had to be clearly and demonstrably an asset of the bankrupt’s estate.

26.              The court (Costello J) rejected this submission: -

“86. I agree with the submission of the Official Assignee that the enquiry has to be bona fide. If the Official Assignee has a genuine query about an asset in respect of which there is a prospect that it could be recovered for the benefit of creditors, then he must be entitled to investigate that possibility. In that case, the bankrupt may not take the unilateral view that the asset is in fact not an asset of the estate and that therefore he, the bankrupt, is not obliged to provide the information available to him to the Official Assignee. That is the logical consequence of the construction of the section contended for by the bankrupt in this case. Such a construction is inconsistent with the wording of the section: it does not refer to assets that will or can be realised, but to assets that could be realised. It is also inconsistent with the overall role of the Official Assignee in gathering in the assets of the estate for the benefit of the creditors and the obligations on a bankrupt and other persons having information relevant to matters under investigation to cooperate with the Official Assignee in that regard”.

27.              In addition to the criteria set out in s.85A (4), the bankrupt must not only refrain from failing to cooperate with the Official Assignee in the realisation of assets or from hiding from or failing to disclose to the Official Assignee income or assets which could be realised for the benefit of the creditors of the bankrupt, but has a duty to proactively disclose relevant information. As Costello J put it in Re Patrick J Daly (A Bankrupt) [2018] IEHC 579

“[The bankrupt’s] duty in this regard is not confined to answering questions put to him by the Official Assignee. He must proactively disclose relevant information to the Official Assignee… The Official Assignee is entitled to his assistance and entitled to investigate whether these three assets could be recovered for the benefit of the bankruptcy estate”.

28.              The need to protect the integrity of the bankruptcy process by means of the sanctions available under s.85A (4) has been repeatedly emphasised in the judgments of this Court. In Re Thomas McFeely (A Bankrupt) [2016] IEHC 299, Costello J stated as follows: -

“6. Cooperation, first and foremost by the bankrupt, but by others also, with the Official Assignee is absolutely essential to the operation of the bankruptcy process. Quite simply, it cannot operate without the full cooperation of bankrupts. They have the information in relation to their estates and normally have possession of both the property and the relevant documentation or the relevant information and/or documentation is in the possession of their accountant, solicitor or other agents. It is essential to the integrity of the bankruptcy regime that the various obligations imposed by the Act on each bankrupt personally are observed and complied with fully and to the best of their respective abilities. There is no such thing as a minimum threshold of cooperation. It is for this reason that the Oireachtas has conferred a power upon the court to extend the period of bankruptcy and not to permit the automatic discharge from bankruptcy after the expiration of three (and now one) years from the date of adjudication where the court is satisfied that there has been either non-cooperation by the bankrupt with the Official Assignee and in the conduct of the bankruptcy or there has been a failure to disclose assets or an attempt to hide assets from the Official Assignee”.

29.              In practical terms, a failure to cooperate with the Official Assignee has a serious adverse effect on the administration of the individual bankruptcy estate, and on the bankruptcy regime in general. The staff of the ISI, already hard pressed to cope with the vastly increased numbers of bankruptcies in recent years, has to waste time and resources on investigating issues in respect of which full disclosure should be made by individual bankrupts in a given case. They may have to engage legal professionals or others to assist them in getting to the bottom of issues which have been rendered opaque by the failure of bankrupts to cooperate. Any costs or expense in this regard will almost invariably be borne by the creditors, in that professional fees discharged from the estate of a given bankrupt depletes the pool of assets which should be available for distribution to the creditors of that estate.

30.              The courts have been astute, in the context of s.85A (4) applications, to ensure that there is no incentive for bankrupts to do anything other than fully comply with their obligations of disclosure and assistance to the Official Assignee. As Costello J put it at para. 91 of In Re Séan Dunne: -

“A bankrupt cannot unilaterally decide whether an asset should be disclosed to the Official Assignee. A bankrupt's statutory obligations and liabilities cannot be limited by his alleged subjective belief as to the extent of those obligations and liabilities. They are as laid out in statute and as interpreted by the courts. Not only may a bankrupt not be the arbiter of which obligations he is required to comply with, he may not decide the extent of that co-operation or engagement. He cannot decide to disclose some information about some assets and unilaterally decide that this satisfies his obligations”. 

The issues generally

31.              In this regard, the Official Assignee acknowledges that the bankrupt provided the draft statement of affairs, the statement of affairs and the statement of personal information in a timely manner. However, it is submitted on behalf of the OA that

“…the Bankrupt now concedes that some of the information contained [in the statement of affairs and statement of personal information] is incorrect and therefore is false and misleading. This concession has only been made following the raising of inconsistencies with the Bankrupt. The Bankrupt’s cooperation has at all times been selective and contingent on what the Bankrupt appears to want in return. He has continued, post the granting of the interim extension order, to fail to provide any proper or independent information or documentation. This poses a significant difficulty for the Official Assignee in the administration of the bankruptcy estate. The Bankrupt has qualified his cooperation to be on his terms without reference to the Official Assignee, the Order of Adjudication and his obligations under the existing statutory regime” [para. 22 written submissions].

32.              In the hearing before this Court, the bankrupt did indeed concede that there were errors and inconsistencies in the provision by him of information to the OA. He emphasised that he did not have the benefit of legal advice in this regard, and candidly and rather disarmingly acknowledged that he had “royally messed up” in relation to some issues. He insisted however that he had done his best to cooperate, a task which he contended was made more difficult by his inability to retrieve documentation in relation to his affairs, which he attributed to confiscation of records by his landlord.

Removal of creditors from statement of affairs/alleged failure to resign as director

33.              Although the bankrupt contended that he had addressed the issue of removal of creditors from his statement of affairs previously, the bankrupt attempted to address the issue definitively in his letter of 7 January 2023, and did so by reference to the criteria in respect of each creditor suggested on behalf of the Official Assignee in a letter of 18 November 2022. As the OA points out in his affidavit of 11 January 2023, the bankrupt does not provide any supporting or vouching documentation with his responses.

34.              The Official Assignee also refers in that affidavit to having contacted a solicitor who had acted for the bankrupt in his family law proceedings up to 2014. That solicitor confirmed amounts allegedly owing by the bankrupt comprising professional fees of €110,000 plus VAT, senior counsel in the sum of €57,710.51, junior counsel in the sum of €36,900, and accounting fees in the sum of €122,167.14, all of which remain undischarged, and which are not included in the bankrupt’s statement of affairs.

35.              In relation to this issue, the bankrupt has contended that the removal of creditors from the statement of affairs was done on the basis of advice furnished by the OA’s office. In his affidavit of 11 January 2023, Mr Larkin avers that he has spoken with the case officers who dealt with the bankrupt’s file “…who confirmed to me that no such advice relating to a ‘without prejudice draft’ or legal advice as to whether a creditor is simpliciter statute barred was given. I say that while my office is there to assist bankrupts it does not provide legal advice and such arbitrary assertions cannot go unrefuted…” [para. 8]

36.              In relation to the alleged failure by the bankrupt to resign from his position as director of Gravity Electricity Limited, it is accepted that no application has been brought to the court for permission to remain as a director of that company notwithstanding the bankrupt’s adjudication.

37.              While there are certainly grounds for characterising both of these issues as a failure to cooperate with the Official Assignee, it is difficult to see how either issue is an instance of the criteria set out at s.85A (4). Neither issue, even taken at the height of the Official Assignee’s position, constitutes a failure to cooperate with the Official Assignee “in the realisation of the assets of the bankrupt” or indicates that the bankrupt has “hidden from or failed to disclose to the Official Assignee income or assets…”. There is no doubt that the bankrupt is obliged to cooperate generally with the Official Assignee in relation to the provision of information and documentation relating to his estate: see in particular s.19 of the Act which, in addition to obliging the bankrupt to provide property and documentation to the Official Assignee, requires the bankrupt to “give every reasonable assistance to the Official Assignee in the administration of the estate…” [s.19(d)].

38.              It is notable that s.19(e) also requires the bankrupt to disclose to the Official Assignee any after-acquired property. The OA can under s.21 of the Act apply to the court to summon before it a bankrupt or other persons to be examined on oath in relation to assets of the bankruptcy or information relating the trade, dealings, affairs or property of the bankrupt. Section 123 of the Bankruptcy Act 1988 sets out a range of offences which may be committed by a bankrupt who does not disclose and yield up his property to the Official Assignee.

39.              Likewise, s.132 of the Companies Act 2014 provides that a person being an undischarged bankrupt who acts as a director or secretary of a company is guilty of a category 2 offence (for the purposes of the penalties as provided for in s.871(2) of the Companies Act 2014), and may also be subject to a disqualification order from the date of any conviction under that section. Section 871(2) provides that a person convicted of a category 2 offence under the Companies Act 2014 can receive, on summary conviction, a class A fine (not exceeding €5,000) or up to twelve months in prison or both; or on indictment, a fine not exceeding €50,000 or five years in prison, or both.

40.              There are therefore provisions of appropriate acts which deal with a failure of cooperation on the part of a bankrupt in relation to matters such as a failure to provide appropriate information in relation to creditors or a failure to deal appropriately with the bankrupt’s directorship of a company. However, it does not seem to me that either of these issues which the OA contends show that the bankrupt has failed to cooperate with him are such as may be considered for the purpose of s.85A (4), in that they do not relate to “the realisation of the assets of the bankrupt”, or the disclosure of income or assets “which could be realised for the benefit of the creditors of the bankrupt”. Accordingly, I do not propose to consider those issues further for the purpose of this application.

 

The Thai property

41.              In the written submissions, the Official Assignee summarises the position in relation to the Thai property as follows: -

“…the bankrupt now:

(i) concedes that he held the title deeds in December 2019;

(ii) concedes Ka-Nit Limited owned the property of which the bankrupt is listed as the sole director;

(iii) states that he never held a mortgage on the Thai property as detailed in the statement of affairs and statement of personal information;

(iv) provides 3 different valuations for the Thai property which contradict the statement of affairs, statement of personal information and the bankrupt’s contemporaneous emails regarding the Thai property;

(v) provides no supporting documentation for any of his claims;

(vi) explains his previous conflicting response being ‘errors’ made ‘under extreme duress’ and due to ‘litigation fatigue’” [para. 11]

42.              In his letter of 9 January 2023, which appears to be intended as a definitive response in relation to queries regarding the Thai property, the bankrupt states that, where the property is located (Koh Samui Island), “…the ownership of property is not permitted by foreigners…there are no mortgages available to purchase property in Koh Samui as the market is considered too volatile and title is extremely difficult to prove…”.

43.              The bankrupt states that his former wife handed over proof of ownership to him in December 2019. He reiterates what he had stated in an email to the Official Assignee on 15 April 2022: -

“The property in Thailand was transferred to my wife in [circa] 2012. She was supposed to return it to my ownership in Dec 2019, but when I arrived to inspect, the house was derelict with broken glass etc. I then discovered it also had eight years of back tax, government duties and many other outstanding creditors and was about to be seized by the Thai Government. I got rid of the property then and secured a net Eur10K to be rid of the property where I was also given a verbal undertaking of two weeks per year timeshare for me to use the property. I have not been back to the premises since then. There is then no email correspondence with the managing agent to provide. The last management agents were those employed by my ex-wife (since gone out of business) and their staff alleged in 2019 that for many years, they had been instructed not to allow me any knowledge of the property and to transfer all income to an offshore account in my ex-wife’s name”.

44.              The bankrupt is adamant that he is no longer the owner of the property in Thailand, and that he disposed of his interest in it for €10,000 in 2020. He has not advanced any explanation as to why his statement of affairs suggested that he had an interest in the property which was subject to a mortgage. He is unable to explain why he remains the sole director of the company, in circumstances where the company search suggests that the company cannot pass resolutions without an approval of “the majority of the attending directors”. He states that he has “no paperwork pertaining to the property as there was very little to begin with…and anything I had was seized, along with my computers, by my landlord during my eviction”.

45.              In his letter of 9 January 2023, the bankrupt continues to insist that he sold a one-eighth share in the company, receiving €10,000 for this share. However, it is not apparent from the company search that Mr Joyce was entitled only to a one-eighth share. As of March 2021, the company’s records as filed with the Ministry of Commerce suggest that four Thai shareholders hold 15,300 group A shares between them. A BVI company, Ming Hin International Holding Limited holds 14,700 B shares. It appears that, prior to the transfer of the 14,700 group B shares to the BVI company, those shares were held almost entirely by Mr Joyce: 14,698 shares, with one share each held by “Mrs Julie Ann Joyce” and “Ms Julie Vanessa Joyce”. The group B shares appear to have been transferred to the BVI company on 10 March 2021. The company’s search recites that, according to the articles of association of the company, both group A and group B shares have equal voting rights, and all shareholders meetings require the presence of 40% of group B shareholders either in person or by proxies and all resolutions require the approval from all attending group B shareholders.

46.              If this information is correct - and it was not contradicted in any respect by the bankrupt - it is totally inconsistent with a one-eighth share being owned by the bankrupt. No explanation has been given by the bankrupt for this. Given that, on the face of the information available, Mr Joyce appears to be the sole director of the company, it is suggested by counsel for the OA that the bankrupt remains in control of Ka-Nit Limited, and thus the Thai property, which promotional material would suggest has been restored to prime condition and is available for rent at a rate of $775-$1,605 per night’s stay.

Household assets

47.              It appears that the bankrupt continues to claim that household assets which were removed from his home bear a value of €141,890. The bankrupt seeks to “offset” this amount against his debts. No corroboration has been furnished by the bankrupt for these values, and indeed a perusal of the list reveals that the values are plucked from the air, and in many cases fanciful in the extreme: a “CD library” is valued at €30,000; a “DVD collection” is also valued at €30,000; a “Metropolis court case file” is valued at €20,000. Swings, trampoline and a treehouse are valued at €3,000, whereas they were valued at €500 in the statement of affairs. In his letter of 30 November 2022 to Mr Kelliher, the bankrupt stands over what he describes as “the estimated replacement value of the items seized by the landlord”. He concedes that “…items such as CD collections and court case files are of no financial value to anyone else so do not appear on my correspondence as assets…I believe that the replacement value should be offset against any debt to the landlord”.

48.              The OA, in his affidavit of 11 January 2023, has exhibited letters from the County Sheriff confirming that he did not seize anything from the bankrupt’s property “against the debt due”. The solicitors acting for the landlord have also confirmed “…that the bankrupt was afforded an opportunity to attend the property after possession was taken to remove any items he wished and the bankrupt attended the property in this regard”. The bankrupt does not accept that this is the case.

Conclusions on section 85A (4) application

49.              The primary ground on which the OA relies in support of the application is what is seen as the bankrupt’s failure to cooperate in relation to the realisation of any interest the bankrupt may have in the Thai property, or the bankrupt’s failure to disclose information in relation to that property. The case law is clear that the OA does not have to establish a certainty that the bankrupt does have such an interest; the bankrupt must give details of his dealings with any assets in which he had or may have an interest, and furnish documentation relevant to those assets. The bankrupt must cooperate with the OA and must be proactive in this regard.

50.              The bankrupt’s performance of his duty in this regard has been unacceptable. His accounts of his dealings with the property have been completely contradictory. The OA has been left to ferret out, as best he can, information and documentation which would indicate the extent, if any, of the bankrupt’s interest or control in the company which owns the property. The most recent information obtained by him is completely at odds with the bankrupt’s various accounts of his dealings, and on its face, suggests that the bankrupt may yet have control of, or an interest in, that company. No explanation is advanced by the plaintiff in this regard.

51.              It is difficult to avoid the conclusion, on reviewing the correspondence with the bankrupt, that the bankrupt has avoided any kind of comprehensive and truthful review of the facts in relation to the Thai property, and has simply answered queries on an ad hoc basis, not with a view to imparting useful information, but in order to obfuscate the situation and make things less clear. The bankrupt has made little or no attempt to retrieve documentation which would clarify the position. That task has been left entirely up to the OA, who has had to devote time and resources to investigate the position when the bankrupt should have been in a position to clarify matters.

52.              In relation to the assets allegedly removed from his home, the information supplied by the bankrupt has been entirely contradictory, and over a year after the bankrupt’s adjudication, the OA is no closer to understanding where the assets in a substantial home in Foxrock, County Dublin have gone, or what their value was.

53.              The bankrupt has not responded at all to the letter of 10 November 2022 from the Official Assignee in which details of his potential inheritance from the estate of his late father were sought. Some indulgence by the court may be necessary in this regard, given the bankrupt’s bereavement, and the fact that the situation regarding his father’s estate may be unclear. Nevertheless, the bankrupt will have to respond to the OA’s query, and should have done so by now, if only to say that he was taking steps to investigate the situation.

54.              It is clear from his numerous appearances before this Court that the bankrupt has been engaged in family law proceedings with his ex-wife. It is no part of this Court’s function to intrude in any way on those proceedings - I mention them only to say that they appear to have taken their toll on the bankrupt, who acknowledges that he is suffering from considerable stress, that his personal and financial circumstances are at a low ebb, and that he wishes to obtain a discharge from bankruptcy as soon as possible as he considers that this is necessary for the progress of his family law proceedings, and in order to get back to work.

55.              While one may have sympathy for the bankrupt as regards his personal plight, it was repeatedly emphasised to the bankrupt by this Court that, once the interim extension had been granted, the best way of securing his discharge from bankruptcy was to afford complete cooperation to the Official Assignee and to answer the OA’s queries as fully as possible. The bankrupt purported to do this, in particular by his letters of 7 and 9 January 2023; however, it must have been apparent to him that, in many respects, these letters, which underscored the inconsistencies with previous communications to the OA, begged as many questions as they answered.

56.              It seems to me that, in all the circumstances, an order pursuant to s.85A (4) is warranted. It cannot be said, as it can in some cases, that there has been a complete absence of cooperation from the bankrupt. He submitted his statement of affairs and statement of personal information in a timely manner. He disclosed the existence of the Thai property, although his subsequent cooperation in relation to the nature of his interest was unsatisfactory in the extreme. He has in general responded to requests for information, although the OA contends that, particularly in relation to the Thai property, he has “only provided information to the extent that he deemed necessary” [written submissions para. 25].

57.              Counsel for the Official Assignee, in her written submissions drafted on 11 January 2023, submitted that the non-cooperation and non-disclosure was at the “medium end of the spectrum”, and set out the reasons for this conclusion. At the hearing before me, counsel was inclined to revise that assessment by suggesting that, in view of the matters in relation to the Thai property disclosed in the company

search exhibited to Mr Kelliher’s affidavit, the failures on the part of the bankrupt were more serious and perhaps tending towards the upper end of the eight-year spectrum set out in s.85A (4)(i).

58.              There is a chaotic quality to the responses supplied by the bankrupt over the course of the last year. While it is possible that this indicates a conscious desire to mislead and obfuscate, one suspects that a more devious and calculating approach would have yielded a more consistent and considered pattern of evasion and circumlocution. It is clear that the bankrupt’s responses on the two issues concerning assets do not constitute anything like adequate cooperation and disclosure. Whether that was at all times the bankrupt’s intention is less so. That is not to minimise the seriousness of the bankrupt’s failure to cooperate with the OA. I am however entitled to look at the bankrupt’s conduct in the round, and to give full weight to mitigating factors.

59.              I regard the bankrupt’s non-cooperation and lack of disclosure as serious. I do not however regard it as trending towards the upper end of the eight-year spectrum. As against that, the integrity of the bankruptcy system requires that serious breaches of bankrupt’s duties attract a serious sanction. I consider that an extension to a mid-point of the maximum 7-year extension permitted under s.85A (4) (i) is appropriate in all the circumstances. I will therefore order that the bankruptcy shall stand discharged on 23 May 2026.

60.              The parties might bear in mind that the bankrupt’s duties continue, and he remains obliged to assist the OA in his statutory task of getting in the assets of the estate and determining the liabilities. There are sanctions in the Act other than those contained in s.85A (4) if the bankrupt does not comply with his duties. Hopefully in Mr Joyce’s case it will not be necessary for the OA to consider his options in that regard.

61.              It may also be appropriate to say that being an undischarged bankrupt is generally - as a matter of law at any rate - not an impediment to obtaining employment, although there are positions in respect of which there are certain statutory prohibitions in that regard. It was also not apparent to me why being an undischarged bankrupt was - as the bankrupt on more than one occasion insisted - an impediment in seeking access to one’s children in family law proceedings. However, that is entirely a matter for the family law courts, and I make no further comment in that regard.

The bankrupt’s application

62.              The bankrupt had issued a notice of motion on 18 November 2022, returnable for 5 December 2022, in which he sought a number of reliefs. The first relief sought was in relation to discovery of certain documents; an order was sought that he be permitted to pursue litigation against a former solicitor for professional negligence, the bankrupt acknowledging that the cause of action vested in the OA. In this regard, the bankrupt also asked for a written undertaking from the OA that he “has in no way compromised the applicant’s case against [the solicitor in question] …”. The bankrupt also sought an order that Irish Independent Newspapers, which was not a respondent to the motion, remove its article about his bankruptcy published on 17 February 2022.

63.              The OA swore an affidavit in response to the motion on 1 December 2022. The OA trenchantly rejected any entitlement on the part of the bankrupt to the reliefs sought, and in particular any reliefs in relation to communications with or in relation to the bankrupt’s ex-wife. In particular, it was denied that any of the correspondence exhibited by the OA was subject to the in-camera rule applicable in family law proceedings.

64.              The motion was heard by this Court on 5 December 2022, and ultimately adjourned to the date of the hearing of the s.85A (4) motion. On that date, the bankrupt accepted that the various reliefs he had sought were either inappropriate or no longer appropriate, and did not press the application.

65.              The one matter which did appear to exercise the bankrupt was his wish to maintain professional negligence proceedings against a former solicitor. He claimed to have received advices that such proceedings were appropriate. I informed him that I would not make an order divesting the OA of the right to prosecute any such proceedings, but suggested that he might discuss with the OA what the OA’s intentions in relation to such proceedings were, and any course of action to be taken in the event that the OA does not wish to pursue same.

Orders

66.              The orders which I propose to make are as follows: -

(1)        An order in relation to the s.85A (4) application as indicated at para. 59    above;

(2)        an order that the bankrupt’s application by way of notice of motion issued on 18 November 2022 be dismissed;

(3)        orders as to costs.

67.              In this latter regard, I would propose to award the OA his costs of the s.85(4A) application in the bankruptcy. I propose to make no order as to costs in relation to the bankrupt’s application. If either of the parties wishes to suggest that the court make some other order in relation to costs, I will allow the parties to make written submissions of not more than 750 words within 7 days of the delivery of this judgment, after which I will make an order without further reference to the parties.