Treasury opens case to overturn NAMA's receivers for properties
TREASURY Holdings has begun a High Court challenge in a bid to overturn bad bank NAMA's appointment of receivers over properties worth hundreds of millions of euro.
Lawyers for Treasury yesterday claimed the receiverships threaten 400 Irish jobs and could end any prospect of new office developments in Dublin's IFSC.
The claims were made on the first day of what is expected to be a four-day hearing before Ms Justice Mary Finlay Geoghegan.
Treasury is seeking permission to bring a judicial review of the actions taken by NAMA.
It also wants injunctions to stop the receivers that now control 22 properties selling the assets, before the legal challenge is decided.
Allowing the receiverships to stand could threaten 400 jobs, and result in the closure of the Ritz Carlton Hotel in Co Wicklow, the company that owns Dublin's National Convention Centre and end a Sligo town centre project, lawyers for Treasury have claimed.
The core of the Treasury legal case is a claim that NAMA acted in bad faith in its dealing with Treasury and breached the debtor's right to fair procedures.
Treasury is controlled by developers Johnny Ronan and Richard Barrett -- neither man was in court yesterday.
Their company was behind many of Dublin's most prestigious commercial developments, including the National Convention Centre and NAMA's own headquarters building. It owes NAMA €1.5bn.
In court Treasury said its goal was to exit NAMA via a one-off sale.
A loan sale would see NAMA sell the loans owed by Treasury to a third party, leaving the developer to deal with a new "lender".
Such a deal was close to finalisation earlier this year, Treasury argued.
Now it fears NAMA's action in appointing receivers will mean a piecemeal sale and the break-up of its "valuable portfolio", Michael Cush, for Treasury, told the High Court.
He said that NAMA had turned down a "generous" offer from Australian investor Macquarie to buy the Treasury loans for €622m.
A "more complex" bid from US property investor Hines was also on the table, they said.
It offered "a potential total return" to NAMA and the Spencer Dock banking syndicate of some €600m.
Hopes for a sale were scuppered by NAMA's "crucial" decision taken on December 8 last year to appoint receivers.
The decision was not made known to Treasury until about a month later, even though the two sides were in contact throughout December, Mr Cush told the court.
That decision, and a subsequent decision in January to call in the Treasury loans, and appoint receivers, are invalid, he said.
Treasury claims it was taken without notice to the developer and without giving it an opportunity to be heard, in breach of its right to fair procedures.
NAMA disputes the claims and contends it had "engaged rigorously" with Treasury since 2010 but the group's proposals on the way forward were not commercially acceptable.
Lawyers for Treasury will continue their arguments today, followed by two days of counter arguments from NAMA.