THE PRESIDENT of the High Court has decided to establish a three-judge divisional court of the High Court to hear the challenge by property developer Paddy McKillen to the National Assets Management Agency (Nama).
The President of the court, Mr Justice Kearns, will hear the case with Mr Justice Peter Kelly and Mr Justice Frank Clarke.
A divisional court of the High Court sits when the matter being tried is of major legal or constitutional importance. The last time a divisional court was convened was to hear the case between the Mahon tribunal and Irish Timeseditor Geraldine Kennedy and journalist Colm Keena, seeking to force them to reveal the sources for a story by Mr Keena.
Mr McKillen and 15 of his companies were among the 33 biggest bank borrowers whose loans were transferred to Nama.
Last July he and his companies took legal proceedings against Nama and the State. He is challenging Nama on a number of legal issues, including that its taking over of his loans violated his property rights under the Constitution. He is claiming that this affects his business reputation and his ability to raise funds internationally, and violated his rights to fair procedure by refusing to engage with him on the matter.
Mr McKillen is claiming that his loans are not “eligible bank assets” as they are performing, and he is concerned about the impact of the guilt by association of their transfer to Nama, along with other non-performing loans.
His challenge presents “a very real threat to the vital work of Nama that must continue, and be seen to continue, in order to increase and maintain confidence in the Irish banking sector and thereby strengthen and protect the economy of the State”, Department of Finance official Ann Nolan, a key engineer of Nama, said in a court affidavit.
The case begins on October 5th for an expected four days. A team of legal heavy hitters has been recruited by Mr McKillen to poke holes in the legislation that Attorney General Paul Gallagher had a crucial role in drafting.
Nobel Prize-winning economist Dr Joseph Stiglitz, a professor of economics at Columbia University in New York, has sworn one of nine witness statements filed in the High Court by Mr McKillen’s legal team. The arguments will centre on whether Nama’s procedures trample on the property rights and business interests of good borrowers, and whether they are detrimental to the few businesses whose loans are performing, generating income and being taken over by the State agency. The case will be heard in the Commercial Court.
