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Wednesday 27 August 2014

State defends use of promissory notes

Tim Healy

Published 24/01/2013 | 05:00

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THE Minister for Finance was not required under law to put any "ceiling" on amounts to be paid under promissory notes, the State has argued in the High Court.

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The notes were issued in favour of the former Anglo Irish Bank, Educational Building Society and Irish Nationwide Building Society. Some €31bn has been paid so far.

The State also claims that businessman David Hall, because he is not a TD, does not have the required legal standing to bring his High Court challenge, alleging that the promissory notes were issued unlawfully, with the effect that payments under them cannot be made.

No member of the Dail has challenged the notes despite the "considerable political controversy" about them, the State noted in submissions.

A promissory note is an enforceable promise to pay and the fact that some of the payment obligations under the promissory notes continue until 2031 is "not relevant", the State has claimed.

Various claims by Mr Hall seemed to arise from a misapprehension of the procedures for approving expenditure and borrowing by the State, it argues.

Michael McDowell SC, for the Minister for Finance, the State and the Central Bank, outlined the State's arguments when opposing a challenge to the promissory notes by Mr Hall. The action is expected to conclude today, with judgment reserved.

Constitution

Mr Hall, of College Grove, Castleknock, Dublin, is seeking to prevent the Government making payments on foot of the notes issued in favour of the three institutions.

A founder member of the New Beginning group of business people and lawyers – which he has since left – Mr Hall said he had had for some time "grave reservations about the manner and way the public finances of the country have been run".

The Irish people, he said, had never been consulted about the promissory notes because their elected representatives had been bypassed.

They were now being asked to honour a deal which had been made in flagrant breach of the Constitution, had no democratic legitimacy and was in breach of the Treaty on the Functioning of the EU, he argued.

Irish Independent

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