Belfast Telegraph

Car dealer said to owe €5 million euros fails in Northern Ireland bankruptcy bid

A Co Longford car dealer said to have owed €5 million euros has failed in a new bid to be declared bankrupt in Northern Ireland.

The High Court in Belfast rejected John Alex Kane's attempt to have a fresh order made against him following an unprecedented challenge by the Irish Revenue Commissioners.

A judge ruled that his business affairs were based in the south and declared his application an abuse of process.

Mr Kane originally secured bankruptcy status north of the border in June last year.

But the Revenue Commissioners then intervened to have that determination rescinded.

It was believed to be the first time the authority sought to annul a bankruptcy secured outside its borders.

Mr Kane, who has had an address at Granard, Co Longford, petitioned again, arguing that his residence and centre of main interests (COMI) have switched to Northern Ireland.

The Revenue Commissioners disputed his claim and contended that the court lacked international jurisdiction to make a bankruptcy order against him.

Under UK insolvency law the period of bankruptcy typically lasts for a year.

But a much more onerous term of up to 12 years applies in the Irish Republic.

At one stage in the case press were excluded from a hearing in Belfast due to objections raised by the motor trader, who appeared as a personal litigant.

In a ruling delivered last month but only published today, Master Kelly  set out Mr Kane's background dealing in specialist 4x4 vehicles from 2000.

A revenue investigation into his business was launched in 2004 amid suspicions of possible serious VAT and other tax irregularities.

Proceedings were initiated at the High Court in Dublin, with the Revenue Commissioners securing judgment against Mr Kane in 2009 for just under 5m euros.

Master Kelly said it was not in dispute that the businessman's insolvency was due to his dealings in the Republic.

She also identified the relevant date for determining his COMI as being June 21, 2012 when he first made his bankruptcy petition.

On the balance of probabilities Mr Kane was still engaged in business activities in the Republic of Ireland at that stage, the judge held.

She based her conclusion on evidence and documentation that he was still involved in operating his car business in the Republic.

Master Kelly further pointed to his significant commercial interest in land and property.

"For the reasons given, I find therefore that Mr Kane's COMI as at June 21, 2012 lay in the Republic of Ireland and that his move to Northern Ireland for self-serving purposes amounted only to a change in his personal circumstances rather than a change in his COMI," she said.

Describing his argument as "flawed from the outset", she added: "I am also led to conclude from the evidence that Mr Kane's bankruptcy petition is an abuse of process."

Her finding was based on his non-disclosure of material facts and evidence.

"These non-disclosures are serious and cannot be excused by Mr Kane's personal litigant status at the time the bankruptcy order was originally made," she added.

"It is now clear that the non-disclosure issues that arose in the course of the High Court proceedings in Dublin have continued to pervade these proceedings."

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