The High Court has narrowed the defence available to Garrett Kelleher in National Asset Loan Management Limited’s claim over guaranteed loans, ruling that the plenary hearing is confined to an alleged promise that guarantees would not be enforced if he cooperated with NAMA.
Mr Justice Brian J. McGovern made the ruling on a motion by NAMA to strike out parts of the defence as unnecessary, scandalous, or liable to prejudice, embarrass or delay a fair trial. The judgment, delivered on 10 June 2016, records that NAMA had sought summary judgment for €46,834,472.35.
In February 2015, Mr Justice Fullam refused summary judgment but allowed Kelleher to defend the proceedings on one ground: estoppel. The Court of Appeal upheld that decision. The High Court judgment says the parties accepted that estoppel was the only ground permitted to proceed.
Kelleher’s estoppel case is that NAMA or people acting for it represented that it would not enforce his guarantees if he cooperated in the disposal of assets linked to a group of companies described in the judgment as the “Shelbourne connection”. He claims he relied on those representations and cooperated. Those claims have not been determined in this motion.
Mr Justice McGovern said the permitted issue included whether representations were made by Mr John Mulcahy at a meeting in the Schoolhouse Bar on Northumberland Road in Dublin in mid-September 2009, and at a meeting in the Treasury Building on 2 November 2010. It also included alleged similar representations by other NAMA or plaintiff personnel at meetings between 2009 and 2013. The hearing could also address whether NAMA’s objection under section 193 was fatal to the estoppel defence.
The judge struck out several pleaded claims that NAMA’s payment demands were unlawful because they did not give its true reasons for enforcement. He also struck out paragraphs concerning matters outside the estoppel ground, including issues of value, while preserving specified wording about prior representations and Kelleher’s cooperation. The first sentence of paragraph 20, concerning cooperation to maximise recovery of the assets, was allowed to remain.
The ruling addressed the scope of the defence only. It did not decide whether the alleged representations were made, whether Kelleher relied on them, or whether an estoppel prevents enforcement.