Bailey does not recall suggesting £100,000 pay-out

The tribunal was told by Mr Michael Bailey yesterday he could not recall suggesting to Mr Joseph Murphy jnr that £100,000 should be paid to Mr James Gogarty "to buy his silence".

However he admitted that if he had "an opportunity of solving the case by paying £100,000 to Mr Gogarty, I probably would have paid it".

Mr Bailey was being questioned about his dealings with Mr Murphy, who had been involved in a bitter financial dispute with Mr Gogarty, a former director of the Murphy Group. Mr Bailey said he arranged a "peace" meeting for the two men in June 1986, after which he had no further contact with Mr Murphy.

Mr Desmond O'Neill SC, for the tribunal, said: "It follows then that you cannot have told him that the sum of £100,000 should be offered to Mr Gogarty to make him go away."

Mr Bailey replied: "I never recalled that being said. If I did say it I don't recall it." Pressed further, however, Mr Bailey said: "Maybe if I was talking to him - and I don't recall talking to him - maybe there was an off-hand saying that £100,000 would sort it out."

He added: "If I had the opportunity of paying the £100,000 to Mr Gogarty you can see what it would have saved the whole State and all concerned. I don't condone that if I had an opportunity of solving the case by paying £100,000 to Mr Gogarty I probably would have paid it, and I'm being very honest about it."

Mr Bailey said he arranged the June 1986 meeting after visiting Mr Gogarty at his home, where the Murphy Group employee said "some unbelievably derogatory things about Joe jnr".

At this stage, nonetheless, Mr Bailey believed Mr Gogarty wanted to put his differences with the Murphys behind him.

Mr Bailey contacted Mr Frank Reynolds of the Murphy Group who said Mr Murphy jnr would phone him. This he did. Mr Murphy agreed to give Mr Gogarty "one final chance". The meeting was arranged for the Burlington Hotel in Dublin. However, Mr Gogarty failed to show. "I think we waited an hour," Mr Bailey said. Asked to explain his motivation for arranging the meeting, Mr Bailey said he merely wanted to bring the two parties together so they could resolve their differences.

Mr Bailey said that while he waited for Mr Gogarty to turn up he did not discuss the dispute with Mr Murphy. Mr Bailey said he could not recall contacting Mr Murphy jnr in London by phone after he had spoken to Mr Ray Burke on June 29th, 1997, nor could he recall discussing a newspaper article with Mr Murphy jnr which claimed Mr Bailey's company, Bovale Developments, had made a £30,000 payment to Mr Burke.

Further evidence is to be heard from Mr Bailey when the tribunal resumes at 10.30 a.m. today.