NAMA loses court fight over legal firm's costs
NAMA has failed in an effort to block a payment of "costs" to a Limerick law firm whose owners owe the toxic bank €323m.
The law firm is owned by Paul O'Brien who owes NAMA a massive €288m, according to documents filed at the High Court; his legal and business partner Denis McMahon owes NAMA €35m.
NAMA has already moved against the men by appointing receivers to a swathe of properties.
In January NAMA appointed Grant Thornton as receiver over Newtown Shopping Centre in Annacotty, in Limerick; units at the Racefield Shopping Centre, also in Limerick city; the Showgrounds Shopping Centre, Clonmel; units at Doughiska Shopping Centre, Galway; and Brasscock Shopping Centre in Waterford.
Now, however, law firm McMahon O'Brien has won the right to be paid "costs" for advising two of the companies over the objections of NAMA.
Before going into receivership two companies in the property empire, Greenband Investments and Mount Kennett, won a legal case taken in relation to a land deal in Clonmel.
Greenband is owned by Mr O'Brien, while Mr O'Brien and Mr McMahon are investors in Mount Kennett.
The companies were awarded €3.25m including legal costs -- which were to be paid to McMahon O'Brien.
However, the ruling was appealed by the losing side.
And in a unique twist NAMA-appointed receivers were in control of the companies at the heart of the case by the time the case got back to court.
NAMA's receivers then settled the case for €1.5m, and invited the court to "vacate the order for costs".
The receivers argued that the links between the legal firm and the companies in receivership are so close that all of the money recovered in the case should go to NAMA.
At the High Court Judge Frank Clarke overruled that request.
In a judgment published last week, but delivered in March, Judge Clarke said NAMA would have to recover money from the two men in the normal way.
At the end of March, NAMA took separate legal action against Mr O'Brien, Mr McMahon and investors and companies linked to the two men, by seeking summary judgments against them.
Law firm McMahon O'Brien has offices in Limerick and Dublin, and is not affected by any of the NAMA actions and continues to operate as normal.