First NAMA case may need global experts to appear
Published 21/09/2010 | 05:00
INTERNATIONAL expert witnesses may have to travel here to give evidence in the first legal action against NAMA.
Yesterday the High Court heard that some witnesses, who have provided written statements in advance of the litigation by property investor Paddy McKillen and 15 of his companies, may need to be cross-examined.
Previously it was thought that the legal action, which challenges the constitutionality of key provisions of the act setting up toxic loans agency, could be conducted on the basis of written submissions alone.
Mr McKillen, who owes some €2bn to two Irish banks and is resisting the transfer of his loans to NAMA, claims that he is not an impaired borrower.
The Government has told the Commercial Court that the case presents a very real threat to the vital work of NAMA, and claims his debts potentially pose a systemic risk to the Irish economy and the banking system if he encounters difficulties repaying his loans.
Nobel Prize-winning economist Dr Joseph Stiglitz, who served as chief economist and senior vice-president of the World Bank between 1997 and 2000, is among nine witnesses who have filed statements in support of Mr McKillen's action.
NAMA has also retained a series of experts to defend Mr McKillen's challenge including Irish economist Jim Power and Ciaran O hOghartaigh, professor of accounting at the UCD School of Business.
The state agency has filed affidavits from Trinity College economists Philip Lane and Dermot McAleese in support of its defence.
The legal action is now set to run for two weeks as the evidence is "more substantial" than previously thought, High Court Judge Mr Justice Frank Clarke was told yesterday.
The judge was also told that Mr McKillen is seeking to have the original statement of claim on which his legal action is grounded amended in advance of the trial.
It is not known if the decision to amend the statement of grounds is related to a letter obtained from the European Commission by Fine Gael senator Eugene Regan which states that loans are only considered eligible for transfer if they were owed by an impaired borrower.
One of the experts hired by Mr McKillen's legal team to support his case is Dr Michael Cragg, an economic consultant with The Brattle Group who reported on major corporate failures including Lehman Brothers and AIG.