Developer 'instigated' letter over NAMA, court told
A LETTER from Fine Gael Senator Eugene Regan to the European Commission -- seeking clarification of its decision approving the National Assets Management Agency (NAMA) -- appeared to have been written at the "instigation" of property investor Paddy McKillen, counsel for the State told the High Court yesterday.
Maurice Collins SC also rejected arguments that the reply to Senator O'Regan from a commission official indicated that its February 10 approval for the NAMA scheme meant that only "impaired" loans could be transferred to NAMA.
The official's letter had no legal status, was inadmissible and irrelevant, counsel said, adding that Mr McKillen and his companies had no entitlement to question the unanimous decision of the commission.
He said Mr McKillen was arguing that the letter meant the commission's approval for the NAMA scheme was approval only for the transfer of loans of "impaired" borrowers.
If Mr McKillen was correct, argued counsel, then the commission either fundamentally misunderstood what was being proposed or had imposed a "dramatically different" definition of eligible loans.
These were both "incredible propositions", he said. The commission's decision was clear, it was approving a "macro approach" by the Government aimed at procuring a "clean break" from risky loans and could only be understood as approval for the NAMA scheme.
Even if NAMA could only acquire the loans of an "impaired borrower" -- and the State insisted that was clearly not the case -- NAMA could still acquire Mr McKillen's loans as some of these were impaired.
Mr Collins was making legal submissions in the continuing hearing of the action by Mr McKillen and 15 of his companies to prevent the transfer of their Bank of Ireland loans to NAMA. The developer claims that those loans amount to some €211m, while NAMA claims they total some €297m.
Mr Collins will conclude his arguments this morning, after which Shane Murphy SC will reply for Mr McKillen.
In other submissions yesterday, Mr Collins rejected arguments on behalf of Mr McKillen that the decision to acquire his loans was null and void because it was taken on December 11-14, 2009, prior to the establishment of NAMA on December 21.
It could not be the case that the work done prior to NAMA's establishment should be set at nought and it should be made to start again, counsel said.