Businessman facing €200,000 debt transferred his share of home to wife, court told

High court reporters

A businessman who transferred his share in the family home to his wife as his company faced a bill for more than €200,000 for building work on its premises can be sued personally over the debt, the High Court has ruled.

Francis Hanrahan was the only director of Carly Agencies Ltd, which traded as Tryst Shoes of South Anne Street, Dublin.

Carly, which is now in liquidation, along with Mr Hanrahan and his wife Patricia, who was secretary of Carly, was sued by Noel Conway Construction Ltd of Co Meath over building work carried out on the Tryst premises in 2019.

Noel Conway, who is a director of his company, is seeking judgment for €201,756 against the defendants.

The Hanrahans asked the court to remove them from the proceedings on the basis that neither of them are a necessary party to the case. Mr Conway opposed the application.

Ms Justice Marguerite Bolger refused the Hanrahans' application.

The judge said there was no dispute between the parties that the work on the premises was completed and that the Hanrahans derived no personal benefit from it.

The dispute related to whether the contract for the works was between Carly or with Mr Hanrahan in his personal capacity. His wife's involvement derived from the transfer of Mr Hanrahan's interest in their debt-free family home to his wife in February 2020.

Mr Conway claims Mr Hanrahan was, at the time of the transfer, aware of what Mr Conway says was his personal liability for the works bill.

Two interim payments, including one of €75,000 in December 2019, were made in the name of the company although an invoice for the second payment was raised in Mr Hanrahan's name.

A second invoice for the outstanding €201,000 was raised the same day in the names of both Hanrahans. Mr Hanrahan, in conversations with the Conway firm, said he would raise money from his pension fund to pay the debt.

The judge said the absence of any explanation for the transfer of the family home was "not helpful" to the Hanrahans' position.

She was not satisfied they had established that they are not necessary parties to the proceedings.

She said Mr Hanrahan played a role in negotiating the works done by Mr Conway which Mr Hanrahan said he did as an agent of Carly.

There was no evidence of Mr Hanrahan having advised Mr Conway of the nature of what he said was his agency role or any evidence of Carly’s involvement in the contract until September 2019 at the earliest.

She refused the Hanrahans' application.