€31bn promissory notes law ‘not unconstitutional’

A law under which the minister for finance issued €31bn promissory notes for Anglo Irish Bank and other financial instiutions did not amount to an unconstitutional “blank cheque”, the State has told the Supreme Court.
€31bn promissory notes law ‘not unconstitutional’

The court will resume, on a later date, hearing the appeal by Independent TD Joan Collins against the High Court’s rejection of her challenge over the issuing of the promissory notes.

The State contends the minister was empowered to issue the notes under a 2008 law, the Credit Institutions (Financial Stabilisation) Act.

The notes were security for continuation of emergency liquidity assistance from the Central Bank for the banks after the government provided the bank guarantee of September 2008.

Ms Collins maintains the notes were impermissibly issued without a Dáil vote in breach of constitutional provisions dealing with appropriation of public money.

When the appeal failed to conclude as expected yesterday, Chief Justice Susan Denham said the court will allocate a further hour to it on a later date.

The case relates to promissory notes issued for Anglo, Irish Nationwide Building Society, and Educational Building Society.

Anglo and INBS were later nationalised. After their successor in title, Irish Bank Resolution Corporation, was wound up in 2013, the Anglo note, on which €25bn was then outstanding, was converted into long-term Irish government bonds.

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