The chairman of the Flood tribunal has issued an unprecedented statement denying he agreed to cover Mr Ray Burke's multi-million euro legal costs in return for the former politician's co-operation with his inquiry.
Mr Justice Flood yesterday "emphatically denied" reports that he had made an agreement on costs with Mr Burke's legal team before the start of his evidence four years ago.
If the claim were true, Mr Justice Flood would have been forced into the embarrassing position of awarding massive legal costs to a politician he declared corrupt in his interim report less than a year ago.
The tribunal chairman is now expected to rule that Mr Burke and other witnesses who were found to have hindered and obstructed the tribunal should pay their own legal costs and possibly even some of the tribunal's costs.
Mr Justice Flood also denied that any agreement was even sought by the politician's legal team, who were led at the time by senior counsel Mr Joe Finnegan, now president of the High Court.
However, The Irish Times understands that Mr Burke and some of his current legal representatives believe they did have an agreement on costs.
In the statement published yesterday on the tribunal's website, Mr Justice Flood also moved to scotch rumours of a dispute between two of the bar's most senior figures by revealing that Mr Justice Finnegan supported his version of events.
According to the statement, Mr Justice Finnegan, who ceased to be Mr Burke's barrister when he was appointed to the High Court, denies that he sought or reached any agreement on Mr Burke's legal costs at the time.
He also says that he ceased to act for Mr Burke because he was appointed to the High Court "and not for any other reason".
Mr Finnegan took over as Mr Burke's barrister after the politician parted company with his previous legal team in circumstances which have never been publicly explained. At the time, Mr Burke maintained that he could not afford to have a legal team permanently present for the long-running hearings in Dublin Castle.
It is believed that Mr Justice Finnegan secured agreement that he would be forewarned if anything significant was coming up, and would therefore not have to attend daily.
The tribunal has not sat in public for over five weeks and planned hearings on the issue of costs have been postponed without explanation on a number of occasions after the dispute between Mr Burke and the tribunal surfaced in the Sunday Tribune.
In recent weeks, the row has been the subject of correspondence involving the tribunal, Mr Burke's current legal team and Mr Justice Finnegan.
Mr Justice Flood was unwell for a period but is understood to have recovered; public hearings are expected to resume next week at the earliest.
Many of those who were found to have hindered and obstructed the tribunal are expected to argue forcefully against any attempt by the tribunal to impose costs.
With Mr Justice Flood turning 75 this month and the tribunal expected to run for another 15 to 20 years at current rates of progress, senior Government and legal figures are looking at ways of reforming the inquiry.
