Northern developers consider court fight with NAMA
Published 07/09/2010 | 05:00
NORTHERN Ireland developers are considering a legal attack against the National Asset Management Agency (NAMA) in the High Court in Belfast.
The Irish Independent has learned that a small but influential cohort of developers who object to the transfer of their loans to the State's "bad bank", are exploring the possibility of bringing the action.
It is understood the group would try to take an action under Britain's 1998 Human Rights Act, challenging the right of NAMA to acquire certain assets, and testing the definition of eligible assets and the agency's powers outside its jurisdiction.
The developers, who are building support for a test case and have sought preliminary legal advice on its prospects, also claim that NAMA is an unjust and disproportionate attack on their property rights.
Up to 150 developers and investors from Northern Ireland are likely to find their loans transferred into NAMA.
In all, some €5bn worth of loans will be transferred from Northern Ireland into NAMA, which DUP finance minister Sammy Wilson claims is critical to avoid "a catastrophe" there.
The proposed litigation would mark the opening of a second legal front against NAMA, which is defending a critical legal challenge currently being fast-tracked in the Commercial Court in Dublin.
That action, which will come before the Commercial Court in October, has been brought by Belfast-born, but Dublin-based, developer Paddy McKillen who has claimed that a definition of eligible assets used in the NAMA act is unconstitutional.
Mr McKillen has also complained that being associated with the transfer of loans to what he called a "toxic bank" could affect his reputation.
Mr McKillen, whose property interests include the Jervis Street Shopping Centre in Dublin and a share of the Maybourne Hotel Group in London -- which owns the five-star Claridge's and Connaught hotels -- has inspired the developers in the North to consider a similar test case.
Banks in the Republic funded some of the signature developments in greater Belfast and other areas of Northern Ireland over the past decade.
It is understood that Irish banks played a major underwriting role in the €117m Titanic Quarter development in Belfast's abandoned shipyards.