The High Court has sent National Asset Loan Management Limited’s summary judgment application against John Hegarty to a plenary hearing, finding substantial grounds to hear evidence on his claims of negligent misrepresentation and estoppel.
The application sought €4,634,046.97 in connection with liabilities arising from a shopping centre development in Clonmel. Hegarty had previously consented to summary judgment for €15,515,678.50 in the related proceedings, accepting that he had no defence concerning borrowings and guarantees for a Maynooth development. He disputed the extent of his liability for Clonmel, saying Allied Irish Banks had agreed to pursue him for only half.
Hegarty said he raised concerns at an April 2009 business meeting about the amount borrowed by the other parties. He alleged that an AIB representative assured him his liability would be limited to 50%, reflecting his interest in the development. The judgment recounted supporting material, including affidavits and a credit committee report, but said the evidence did not establish a definitive set of facts.
The court said summary judgment could be entered only where it was very clear that the defendant had no defence. It concluded Hegarty had raised a sufficient controversy to require evidence at trial. The judge also said the question of whether an assurance could alter the effect of written documents should not be finally decided on the summary application.
NALM relied on section 101 of the National Asset Management Agency Act 2009, which can prevent certain undisclosed bank representations or undertakings from being relied on against NAMA. Hegarty argued that the section did not cover his estoppel case and raised a constitutional challenge if the section barred his claim. The judgment expressed no final view on whether section 101 applies or is constitutional.
The court granted Hegarty leave to remit the matter to a plenary hearing. It ordered that the Attorney General be notified of the constitutional issues, with any participation to be determined by the trial judge if the facts require that issue to be tried. The judgment did not determine Hegarty’s liability or the ultimate merits of his defences.