Treasury plans to appeal court backing for Nama

TROUBLED PROPERTY developer Treasury Holdings plans to appeal the High Court ruling yesterday rejecting its claim for relief against the decision of the National Asset Management Agency to enforce its loans in January of this year and appoint receivers to the assets involved.

In a 91-page ruling yesterday, Ms Justice Mary Finlay Geoghegan found in Nama’s favour on the basis that Treasury had “acquiesced in the ground rules set out by Nama on January 12th” in relation to a 14-day standstill on the enforcement action.

The standstill was to allow Treasury the opportunity to bring forward investment proposals that would have involved the loans being acquired from Nama.

In the agreement, the judge found that Treasury had given an undertaking that it would not object to the appointment of receivers or commence any legal action in the event that Nama did not find the investment proposals satisfactory.

Ms Justice Finlay Geoghegan ruled that the court “must hold” that Treasury be stopped from pursuing its claim against Nama.

However, she also found that Nama had not given the developer a proper hearing before taking its enforcement decision.

She also found that Nama had breached its obligation to act fairly and reasonably in giving Treasury a fair hearing before taking its decision.

Treasury declined to state on which grounds it would seek to appeal.

In a statement, Treasury noted that three bids from overseas investors for its loans had been rejected by Nama before it appointed receivers Ernst Young and PwC to the loans.

“We understand that a new potential bidder, a major prestigious international entity, has been in touch with Nama in recent times and is preparing a bid for the loan portfolio,” Treasury added.

Nama declined to comment on this but it is believed that it has received no formal approach from the unidentified bidder.

Treasury also called for a “third-party negotiator” to be appointed to secure the “best bid” for the Treasury loans.

It is understood that Nama would not agree to any such appointment.

The matter of costs has yet to be settled. The parties agreed that the matter should be returned to the court for mention on October 4th.

Treasury’s legal costs amount to about €400,000 with those of Nama and KBC Bank, a notice party in the proceedings as a syndicate partner of Nama in relation to loans outstanding on Spencer Dock in Dublin, likely to be of a similar level.

Nama may not get all its costs given that the judge made some adverse findings in relation to its handling of the enforcement decision.

In a statement yesterday, Nama welcomed the ruling and said it would “continue to work with the Nama-appointed receivers in this case to maximise the return to the taxpayer”.

Treasury said its shareholders – Richard Barrett and Johnny Ronan – recognised that any deal with foreign investors would involve them losing control of Treasury.

“However, it will ensure that the unique skills and expertise this company has will be kept together, that the 300 jobs in Treasury Holdings are safeguarded, and that this company will play an important role in Ireland’s economic recovery,” the company added.

Separately, Treasury will continue to pursue its multimillion euro damages legal action against Nama relating to the enforcement decision.

This action also includes the decision by Nama and Lloyds bank in the UK to move to enforce loans on Battersea Power Station in London.

KBC also has a winding-up petition against Treasury pending.