John Drennan: Weary taxpayers face €700m bill for tribunals

John Drennan

April 25 2010 04:44 AM

AFTER bailing out the bankers, the near bankrupt Irish taxpayer is now faced with the real possibility of having to fork out €700m to cover the legal costs of long-running tribunals.

To date, our tribunals have created 22 tribunal millionaires amongst the €2,500-a-day ranks of the tribunal barrister.

The Flood/Mahon Tribunal has created 16 millionaires while the long-running Moriarty Tribunal has created six millionaires over the last 13 years.

Last week's Supreme Court decision that it was wrong to refuse costs to the Murphy group on the grounds of non co-operation with the Planning Tribunal means that barristers acting for clients who have been before the tribunal for years will have to have their costs covered by the State -- creating a whole new class of barrister millionaires.

While the Moriarty and Mahon Tribunals continue on their merry way, payouts to the legal teams of witnesses have come in at a multiple of the tribunals' own legal costs.

The Beef Tribunal's own legal costs were €4.6m -- but so-called 'third-party costs' for witnesses called before the tribunal were almost four times higher at €17.28m.

The Lindsay Tribunal's own costs were €4.3m -- but the third-party legal costs were nine times higher at €39.1m.

The legal costs of the McCracken Tribunal were €860,000 while third-party legal costs were seven times higher at €5.6m.

Should these ratios be carried on into the long-running discredited Mahon and Moriarty Tribunals the consequences for the taxpayers will be lethal.

To date, the Mahon Tribunal has cost the taxpayer €90m -- €51m of which has gone to its legal team. The Moriarty Tribunal has to date cost €41.6m of which €31m has gone to the tribunal's own legal team.

It had been anticipated that future potential legal bills for both tribunals would be reduced by the 2004 decision of Justice Alan Mahon to refuse costs to witnesses such as the Murphy Group and Ray Burke because, in the view of the tribunal, they had acted corruptly and failed to co-operate with the tribunal.

But the unanimous Supreme Court decision that the judges had exceeded their powers could yet vindicate the warning in 2007 by the then Justice Minister Michael McDowell that tribunals could cost the state €1bn.

Outside of Ray Burke -- the corrupt former minister, whose claim for legal fees of "a sum in excess of €10m'' was rejected by Alan Mahon in 2004 -- others who are likely to have incurred a substantial bill of costs include the builders Tom and Mick Bailey, and corrupt former government spin doctor Frank Dunlop.

Other figures that are facing substantial legal costs include former EU commissioners Padraig Flynn, Fianna Fail senator Don Lydon and former Dublin City manager George Redmond and the former Fianna Fail Taoiseach Bertie Ahern.

The Supreme Court judgement will also come as a significant relief to Moriarty Tribunal witnesses such as the former Fine Gael minister Michael Lowry.

Legal cost accountants believe that the complexity of the issues dealt with in that tribunal and the "boutique'' nature of the senior counsel hired for this tribunal, which included some of the most expensive bar advocates, means that Ray Burke's likely €10m bill will be "dwarfed'' by claims for costs of "up to €25m for some witnesses''.

Echoing the warning of the Taxing Master James Flynn about tribunal Frankensteins, Cork TD PJ Sheehan said the Supreme Court has created "an open-ended chequebook for barristers''.

Sunday Independent