Debarred lawyer link to Waterside scheme
A DEBARRED lawyer was at the centre of a doomed deal between former Taoiseach Albert Reynolds and defunct Londonderry building firm, O’Neill Brothers, to finance a housing and hotel development in the Waterside in the late 1990s, the Sentinel can reveal.
Patrick Russell was struck off by The King’s Inns in January this year for bringing the legal profession into disrepute.
He was debarred after falsely stating that a named solicitor had been acting for a client when this was not the case.
The King’s Inns said his “behaviour was fundamentally dishonest from beginning to end. It tends to bring the profession of barrister into disrepute. It was unethical in the extreme and was prejudicial to the administration of justice.”
He is currently being investigated by An Garda Síochána who also believe he conned a company out of 290,000 euro that should have been paid to the Irish Revenue Commissioners and instead gave it to former IRA hunger striker and Dungiven-native, Tom McFeely.
Today the Sentinel can also reveal how Mr Russell was at the centre of a bid to develop 176 houses and a 100 bed hotel on the site of the Good Shepherd Convent in Londonderry’s Waterside in the late 1990s.
According to evidence provided by Albert Reynolds in 2006 to the Mahon tribunal into planning corruption in the Republic of Ireland, Mr Russell helped broker an agreement between the former Taoiseach and the O’Neill Brothers construction company, which subsequently collapsed in acrimony.
Questioned by Senior Counsel to the Mahon Tribunal Patricia Dillon, Mr Reynolds explained how the struck-off barrister had been heavily involved in putting together the deal for the Waterside development that ultimately saw the O’Neill Brothers provide £250k for the project, which never went ahead.
“He came back a few times with proposals, different projects,” Mr Reynolds told the tribunal. “And eventually, as I say, I became involved in a project up in Derry City.
“And he got involved in that with me. And there was a Mr Noel Gallagher from Derry that introduced me to the O’Neill Brothers in Derry who were a very good name, good builders and we got together.
“There was a very good site available where you could get planning permission for housing. And there was an hotel project introduced for about 100 beds. And he introduced me to the O’Neills for the first time, Mr Gallagher. And Mr Russell done a lot of the spade work in between.”
Asked what Mr Russell’s actual function was Mr Reynolds said: “Well he came to me on the basis that he spent a lot of his time going around looking at possible projects.
“He talked about a number of projects he had going in the UK. And he even went to America, as I recall, at one time looking for some of the big hotel chains to come in. So he was always looking for some kind of projects for development.”
Mr Reynolds said his role in the project was to provide either personal or banking finance to fund the scheme.
“Oh, my function, main function would be to provide the finance, either my own finance or banking finance for a project,” he said.
The former Taoiseach told the Tribunal that Mr Gallagher was paid £20k for providing advice on the scheme.
“He was another man that I knew - I knew Derry inside out. He is a long time moving around it and he would know where the potential for development was and he would be a good man to give advice. And he was well known in Derry anyway,” said Mr Reynolds.
During his evidence session Mr Reynolds was shown a ‘joint venture agreement’ between the O’Neill Brothers and Universal Management Consultants, which he accepted he had signed himself.
Regarding the houses and hotel in Londonderry the document said “a new UK registered joint venture company will be formed owned 50 per cent by O’Neill Brothers and 50 per cent by Universal Management Consultants. The investment trust owned by Patrick Russell and Albert Reynolds.”
Mr Reynolds said he didn’t know if the joint venture company was ever set up but he did accept the document related to the Good Shepherd Convent site.
Ms Dillon asked: “Do you see that the document specifically acknowledges receipt of £250k from O’Neill Brothers in contribution to their 50 per cent stake in the development of the Good Shepherd Convent site in Derry?”
Mr Reynolds replied: “£250k in contribution of their 50 per cent stake in the development this money is also totally refundable. Yeah, I do.”
Elsewhere during the same evidence session Mr Reynolds said Mr Russell was also involved in making an entirely separate payment of IR£25k to ex-IRA hunger striker Tom McFeely.
Ms Dillon asked Mr Reynolds about the “builder from Derry,” as he described the Dungiven man.
“Why was Mr McFeely being paid IR£25k Irish pounds?” she asked.
“Because he has advanced it to Russell when he was up in the North. That’s what I was told by Patrick Russell,” Mr Reynolds replied.
Ultimately, the O’Neill Brothers took a case to the Irish High Court concerning the agreement with Universal Management Consultants.
But in 2001 counsel for the O’Neill Brothers (Building Contractors) Ltd of Pennyburn Industrial Estate, Londonderry said the action had been settled and could be struck out.
Last year 24 employees of the O’Neill Brothers lost their jobs after the firm, which had been in operation in Londonderry for 55 years, announced its closure.
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Weather for Londonderry
Saturday 25 May 2013
Temperature: 9 C to 17 C
Wind Speed: 17 mph
Wind direction: South west
Temperature: 9 C to 16 C
Wind Speed: 17 mph
Wind direction: South west