Nama gets court order to examine Daly

A Limerick developer being pursued by the National Assets Management Agency over an €86 million judgment is to be examined before the Commercial Court over whether he has provided full details related to his financial affairs.

Nama said it is not engaged in a “witch-hunt” of Michael Daly but wants to address various concerns including the transfer of his share in his family home to his wife “for natural love and affection”, the sale for €2 of shares in German companies previously given a value of €11 million and his current income and expenditure, the agency told the Commercial Court yesterday.

Michael Daly, a qualified chartered accountant, North Circular Road, Limerick, says he had consented to the €86.5 million judgment but is unable to pay that and has offered to pay €1,000 per month from his monthly salary of €3,000.

He said he considered Nama’s attitude “wholly unreasonable” as he had disclosed all documents available to him and fully co-operated with Nama, including undergoing intensive examination about his financial affairs at the offices of its solicitors.

Family home

He said he had transferred his share in the family home in 2009 to his wife Dympna before judgment was entered against him and that transfer was planned from 2004 when he had left his practice as an accountant for involvement in development projects.

He agreed that transfer was accompanied by a declaration of his solvency. Nama, the court heard, wants documents from an accountancy firm, HDS Partnership, which was said to have prepared that declaration. Nama said HDS was formed by former colleagues of Mr Daly at Grant Thornton and was the main auditor to the Fordmount Group of companies whose loans from Anglo Irish Bank were taken over by Nama.

On the issues raised about the German share sales, Mr Daly said they would “stand up to any review”. The shares sold had no value and the supporting assets were still in place, he said.

Brian Kennedy SC, for Nama, said what Mr Daly had said about the share sales was not consistent with Nama’s understanding and the agency wanted to see the relevant documents. Nama did not have sufficient clarity about these and other matters and wished to examine Mr Daly, he said.

Mr Justice Peter Kelly said Mr Daly had provided extensive documents to Nama and also submitted to an intensive examination about his financial affairs.

Test his claims

Mr Daly says he can do no more and had answered all the questions to the best of his ability but Nama had said it wanted to test his claims about specific matters, the judge said.

The legal threshold for such an examination was low and he would direct it to proceed in April, the judge said.

In December 2010, Mr Daly consented to judgment of more than €86.5 million arising from unpaid loans of €165 million advanced by Anglo to three companies in the Fordmount property group and two partnerships to buy property in Limerick city and county. Under personal guarantees, the bank alleged Mr Daly was liable for €86 million while four solicitors each had a €21 million liability.

Mr Daly claimed he was regarded by Anglo as a “favoured developer” with “easy access” to senior figures in the bank, including Seán Fitzpatrick and David Drumm.

He claimed he relied on oral assurances from Anglo executives that personal guarantees provided by him over loans were secondary to security taken by the bank and would never be relied upon.

Anglo argued the claims about Mr Daly’s access to senior Anglo executives were not relevant and described as “incredible” his claims relating to Anglo’s approach to the guarantees.

Four solicitors also consented to judgment orders arising from guarantees related to loans to companies and partnerships linked to the Fordmount group. Dermot O’Donovan, Michael Sherry and Aidan Frawley, all partners in the Limerick-based firm Dermot G O’Donovan Partners, also raised issues about Anglo’s alleged assurances on guarantees but each later consented to judgment for €21.7 million.

A fourth partner, Thomas Dalton, consented to judgment for €21.4 million.