John Swan (60), of Meadow Bank, Palatine, Co Carlow, the main shareholder and MD of Swan Fruit Ltd (in voluntary liquidation), consented to the disqualification following settlement of proceedings under the Companies Act brought by liquidator PJ Lynch.
He also consented to an order directing Irish Life to transfer €239,000 from a pension fund to the liquidator in his role as pension trustee of the company.
Justice Brian Cregan also approved orders against Mr Swan’s sons, Alex Swan (33), of Pollerton Big, and Niall Swan (30), of The Downs, Pollerton, both Co Carlow, who had acted as managers and directors of the company.
They both consented to orders restricting them from acting as directors for five years of companies with certain capital requirements.
Swan Fruit, which had an annual turnover of €40m, went into voluntary liquidation in 2014, with the loss of 23 jobs, because it was insolvent and unable to pay its debts.
Set up by John Swan in 1996, it operated a retail store in Mullingar along with the wholesale cash-and-carry fruit-and-vegetable business in Carlow.
Proceedings against the Swans were brought by the liquidator with the approval of the director of corporate enforcement in 2016 as part of an investigation into the company.
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In an affidavit, Mr Lynch said he believed John Swan was knowingly a party to the carrying on of the business in a reckless manner and with intent to defraud creditors. While there was no evidence available as to the extent of the involvement of the sons in the firm’s financial affairs, as directors they had a duty to comply with their obligations under company law, he said.
John Swan, in affidavits, denied there was a failure to keep records or that any had been erased.
He claimed the failure of Revenue to make a €480,000 Vat refund was “a material contributory factor to the ultimate demise of the company”.
The liquidator disputed this and said, among the reasons why the company failed was the lack of a financial controller despite having a €40m turnover, a failure to properly account for non-cash assets, the unlawful disposal of assets on an ongoing basis, unlawful withdrawals of monies from company bank accounts and failure to properly account for transactions.
There was further a failure to keep proper books and records and the erasement of supporting software relevant to those records.
There was also a failure to discharge monies to Revenue in a timely manner and the use of those monies as cash flow to keep the company going.
Mr Lynch said the company continued to trade at a time when it was obviously insolvent. Monies due to creditors were not paid, and there was significant falsification of the books.
He said he believed the attitude Mr Swan to the liquidation was “totally unacceptable having regard to the level of wrongdoing that has gone on under his stewardship as the managing director”.
