Ian McGarry, former head of Dunlop Haywards’ city office, has failed in his defence of a claim to account for £625,000 arising out of last year’s £100m collapse of property finance company Lexi Holdings.
McGarry, who was representing himself, asked the High Court to overturn a judgment forcing him to account for the sum following his non-compliance with court orders for disclosure and the tracing of assets.
The orders had been obtained by Lexi’s administrator, KPMG, against former owner Shaid Luqman and those to whom he allegedly made unauthorised payments of more than £50m.
McGarry, who received £625,000, said he paid the money back in April 2006 and that therefore Lexi had no claim against him.
He refused to answer why he had received the £625,000 on the ground it could lead to self-incrimination.
KPMG’s counsel told the court: “The theory that we have put together, and we put it no higher than that, is that around the time the payment was made to McGarry steps were taken by [Shaid Luqman] to obtain security for a loan of £98m to his company, Monaro Investment Promotion, in order to obtain a facility from ABN Amro. He needed inflated valuations on properties to secure that loan and these payments were bribes to McGarry for overvaluations to be submitted in support of that facility.”
Dismissing the application, the judge said that the judgment had been a “fair and proportionate response to repeated failures to comply with orders of the court”.
Neither Luqman nor Monaro were present at the hearing and the judge made no findings as to alleged overvaluations.
McGarry declined to comment.
Lexi Holdings v McGarry Chancery Division (Pumfrey J) 16 May 2007.
Ruth Holtham (instructed by DLA Piper LLP) appeared for the claimant; the defendant appeared in person.
