THE Attorney General has told the High Court property investor Paddy McKillen is not entitled to any “special” treatment to prevent his €2.1 billion loans being transferred to the National Assets Management Agency.
The NAMA Act 2009 was brought in as part of the state’s “unprecedented intervention” via the bank guarantee of October 2008 to support the financial system and economy but Mr McKillen’s legal challenge failed to recognise this context, Paul Gallagher said.
The state was seeking to deal with the problem at “a macro level” but Mr McKillen and his experts did not recognise the banks could not have financed his loans without the state support provided to them since 2008, he argued.
The “writing was on the wall” when the draft NAMA bill of summer 2009 indicated what loans would be acquired, but Mr McKillen had not moved to refinance then, he added.
The banks were the conduit through which the Irish economy was preserved and NAMA was established to remove “troublesome” assets from the banks’ balance sheets. Speed was vital and NAMA aimed to achieve all transfers by February 2011.
The Attorney General was opening the state’s arguments opposing Mr McKillen’s challenge to the procedures by which NAMA decided to acquire his loans. The case relates to Mr McKillen’s loans with Bank of Ireland, which he said are €211 million and NAMA contends are €297m.
Mr McKillen is challenging the transfer on various grounds, including that the procedure by which NAMA decided to acquire the loans breached his constitutional right to fair procedures as he could not make representations against transfer.
Yesterday, Mr Gallagher argued Mr McKillen has established no substantial grounds to permit judicial review of NAMA’s decision. Mr McKillen now accepted the loans were eligible for transfer under the NAMA Act but argued they should not be acquired, he noted.
Earlier, in closing submissions for Mr McKillen, Michael Cush said his client’s “real objective” in this case was “to get the rights he is entitled to within the NAMA model”.
Mr McKillen was not seeking to strike down NAMA but believed he “should not be dealing with it”. There was also a dispute between NAMA and Mr McKillen whether there was default on certain loans.
The case continues today before High Court president, Mr Justice Nicholas Kearns, Mr Justice Peter Kelly and Mr Justice Frank Clarke.
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