The case, brought by Galway-based Murray Timber Products against Quinn Direct, followed a fire in its Galway plant in 2005. The company claimed more than 54m in losses following the blaze.

Evidence was heard that while Quinn Direct accepted liability, it claimed that it had reached a full and final settlement of 14.7m with Murray's in August 2006. Quinn Direct claimed that Murray's reneged on this agreement.

Murray's countered that there was only a part settlement at the figure of 14.7m.

It claimed that the agreement allowed them be free to pursue Quinn Direct for additional monies under the Business Interruption aspect of the policy.

The case centred on whether there was an agreement on the full and final settlement.

But after rigorous cross examination of Quinn Direct's Commercial and UK sales manager John Gannon, who changed his evidence a number of times, the court was told a settlement had been reached with all costs awarded to Murray's.

In the course of the case Mr Justice Peter Kelly expressed his dissatisfaction with the evidence presented by Quinn Direct and at one point threatened to have Gannon cited for contempt or to have papers sent to the director of public prosecutions or the Insurance Licensing authority.

Murray's had a number of complaints about the way Quinn handled the policy and the court heard that Murray's felt it was being pressurised into accepting a low settlement of its claim.

The court heard how Keith Barr, on behalf of Quinn Direct, sent Paddy Murray a letter regretting that it was unable to bring the matter to a conclusion although it was contended in court that Quinn Direct believed there was a full and final settlement with Murray's which was later reneged on.

At one point Justice Kelly intervened to ask Brian Murray, for Quinns: "Would you not expect experienced people in the insurance world, who are negotiating every day of the week, if there was an agreement arrived at two or three days beforehand, rather than writing a letter saying 'we are not able to bring matters to a conclusion', he would be writing saying 'hang on a moment, we have an agreement here, you can't resile from it?'" During cross examination Gannon revealed he had not a single screed of documentation from a number of legal meetings he had in relation to settling the claim.

Justice Kelly pointed out that the first involvement of lawyers in the case was dated 13 November 2006 but in fact Gannon's evidence in court under oath revealed that he had in-house lawyers at Quinn Direct advising him from August onwards at various different dates.

Justice Kelly: "There is not one piece of paper disclosed dealing with that and from the evidence you gave me a few moments ago I understand you made no inquiries with a view to ascertaining whether such documents existed or not, is that correct?"

Gannon: "That's correct, Judge."

Justice Kelly: "What is the reason for that?"

Gannon: "I have no good reason for that."

Justice Kelly: "Does it follow that you just simply swore the Affidavit of Discovery without any care or concern as to whether you were making a full and truthful disclosure to the court?"

Gannon: "I can't say that was how I viewed it myself but that could be taken to be the case."

In further cross examination, Gannon claimed that he considered the claim by Murray Timber Products Ltd to have been finally settled for 14.7m in August with Keith Barr, the former Dublin footballer who works for Quinn Direct. He said that in his view Murray's had reneged on the deal.

However he agreed with Brian O'Moore SC, for Murray's, that although the claim for 14.7m was the biggest claim Quinn Direct had at the time he hadn't informed its reinsurers . . . who would pay 8.2m of the settlement . . .

until the following year.

O'Moore: "Seven months after you say you settled the claim, you put some sort of communication through to the reinsurers to say 'well actually this claim is settled.

I neglected to tell you over the last seven months but it is and we are litigating about it.' Is that right? Is that seriously your evidence Mr Gannon?"

Gannon: "That is my evidence, Judge."

As Gannon continued answering questions, O'Moore interrupted his cross examination to ask for an adjournment for a few minutes.

He said he had received two notes since he had resumed cross-examination which suggested the matter could be resolved immediatly.

Within a short period of time O'Moore informed the judge that the case had been settled with all costs of the proceedings in their entirey to be paid to Murray's.

Addressing his comments to Murray and his clients Quinn Direct Insurance Ltd, Justice Kelly then expressed his reservations about what he had heard.

"The evidence I have heard from Mr Gannon is very disturbing in relation to his attitude and the attitude of his employer, your client, to their Discovery obligations. And what I have heard in the witness box from him, what I have to consider is, whether I ought to deal with this disturbing state of affairs as a contempt of court or whether I should send the papers to the director of public prosecutions or whether the Insurance Licensing Authority should be notified" Murray replied saying that:

"The very most it discloses is a less-than-diligent approach to the discovery obligation but in no sense the type of deliberate attempt to withhold documents or to swear an affidavit which is untruthful that in my submission would normally merit the attention of the court."

Justice Kelly pointed out Gannon didn't even inquire as to whether there were documents which did exist which were clearly discoverable.

"And that coming from a person of his status in a company that is carrying on in a substantial way of business in the insurance world, seems to me to fall far short of what the court is entitled to expect and may trespass into the area of contempt of court or may warrant me sending his testimony and the papers to the director of public prosecutions, " he said.

In evidence, Niall O'Connor, one of three solicitors employed by Quinn Direct, said that he was aware of the obligations of Discovery on a solicitor and a client.

He said he had a number of informal discussions with Gannon on the Murray case but they were not formal meetings with people taking notes.

He said that following the making of the Order of Discovery he asked for everything relating to the matter. In further evidence to the judge, Gannon said he believed he had handed over all documentation.

In his judgement, Justice Kelly said he got an insight into the negotiating tactics of Quinn direct in relation to the largest claim that it had ever faced.

In light of the evidence he had heard he was concerned at what appeared to be a failure on its part to comply with the obligations of Discovery.

He said he was satisfied with the evidence of O'Connor and he was also satisfied that, with one possible exception, Gannon had also met his obligations.

"The one area where perhaps criticism could be made is in respect of non-disclosure of drafts of documents which were generated around the time of the alleged settlement, " he said.

However, the judge added that insofar that there may be a shortcoming, it was not deliberate or designed to hide matters from the court or to disadvantage Murray in the conduct of litigation. The judge said no action would therefore be justified in treating the case as contempt or sending papers to the DPP or doing anything with the licensing authority.