NAMA remains vulnerable to a constitutional challenge from any one of up 150 different property developers and investors whose €2.2bn in loans it has yet to take over.
The threat to the State's so-called bad bank from upwards of 150 separate 'legal entities' comes in spite of the Supreme Court's landmark ruling last Friday that its activities are constitutional, notwithstanding the manner in which it sought to wrest control of €1.4bn of the €2.1bn in loans given to property investor Paddy McKillen by Irish banks.
The Belfast-born and famously media-averse businessman had challenged Nama's move against him, arguing that his business was different to that of other bust developers being managed by the agency, and that his loans by virtue of their size did not, as Nama claimed, pose a "systemic risk" to the Irish economy. Mr McKillen also argued that the agency had not given him a "fair hearing" before it moved to transfer his loans on to its books.
Defending a separate challenge to its constitutionality from developer David Daly in the High Court last Friday, lawyers for Nama argued that he could not now object to the agency's move to call in €457m in loans he and his family owe, having consented to the loans' transfer to Nama over a year ago.
Addressing the court, senior counsel for Nama, Paul Sreenan, said decisions by the Supreme Court in the proceedings brought by Paddy McKillen made it clear that a legal challenge had to be brought at the time of the acquisition of the loans, and not as was happening in Daly's case, nearly a year later.
But whatever decision is arrived at in the Daly case, a further potential challenge or series of challenges to Nama's constitutionality are a distinct possibility, given the fact that some 150 legal entities comprising scores of developers and investors have yet to see their loans, totalling €2.2bn, transferred to Nama's books.
Were that to occur, it could prove to be both costly and embarrassing for the agency, given the legal bill of up to €7m the State is now facing as a result of Paddy McKillen's successful legal challenge.
In a move that took many observers by surprise, Nama revealed last Friday how it had now reversed its decision to seek the transfer of Mr McKillen's borrowings on the basis that since the commencement of his legal challenge in late 2009, they had been paid down substantially from their original €1.4bn total and therefore no longer posed a systemic risk.
While Mr McKillen has been reported as still having loans of €660m with Nama by virtue of his shareholding in the Maybourne Hotel Group, which owns Claridges, the Berkeley and Connaught Hotels in London, an informed source told the Sunday Independent that this debt is shared with a number of investment partners, and is not his alone.
The Sunday Independent further understands that Mr McKillen's banks intend to work with him to refinance the €1.4bn they will now take back on to their books with other international institutions following Nama's decision not to seek their transfer.