Court to decide who pays for Ansbacher

Bank of Ireland Private Banking Ltd, the Bank of Ireland subsidiary that deals exclusively with high net worth individuals, is among a number of companies that the Minister for Justice believes should pay for the Ansbacher inspectors' report.

Cement Roadstone Holdings, the public company of which the late Des Traynor was a director for many years, is another company that is being asked to contribute.

Mr McDowell has applied to the High Court for an order directing Ansbacher Cayman Ltd to repay the €3.4 million costs of the court-appointed inspectors' investigation into Ansbacher's affairs.

The Minister also contends that the Central Bank, and seven other firms named in the report, have a liability for some of those costs.

Mr Justice Smyth yesterday issued directions to facilitate the hearing, expected to last two days, of a preliminary issue as to whether the Minister is entitled to seek costs against the Central Bank and the seven other firms.

The Central Bank and the companies contend the Minister is not entitled under the Companies Act to seek costs against them. They plead, following a High Court decision in the Greencore case in 1992, that the High Court has already ruled it has no jurisdiction to make orders for costs against parties named in a report but not the primary subject of the report's investigation.

Mr Justice Smyth directed the parties to exchange legal submissions within four weeks. The judge said the intention was to have the matter listed in April for the purpose of fixing a date for the hearing.

The companies against whom the Minister is proceeding, in addition to Ansbacher Cayman Ltd, are: Hamilton Ross Company Ltd, Guinness & Mahon (Ireland) Ltd, Guinness Mahon & Company Ltd (London), Henry Ansbacher Holdings plc, Cement Roadstone Holdings plc, Bank of Ireland Private Banking Ltd and Irish Intercontinental Bank.

At an earlier hearing, Mr John Gordon SC, for Ansbacher Cayman Ltd, expressed the view the Central Bank should meet some of the inquiry costs.

He said his client had only taken over the Ansbacher bank in 1988 but the Central Bank had been aware of problems in the bank for 15 years before that and was among the entities criticised in the report.

However, the Central Bank, through counsel, said Ansbacher's application was a bid to "create a sideshow" to divert attention from Ansbacher's "clear responsibility" for costs.

Yesterday, Ms Eileen Barrington, for the Minister, said the Companies Act required the Minister to defray the costs of the inspectors' investigation, amounting to some €3.4 million. The Minister had done so and was entitled to ask the court to direct that a corporate body dealt with in the inspectors' report be required to repay to the Minister the expenses of the investigation.

The Minister was seeking an order directing Ansbacher Cayman Ltd to repay the monies and had also asked for directions as to whether the other companies had a liability.

Last month, the High Court directed the Central Bank should be a party to decide if it had a liability and also provided for the bringing of a motion seeking trial of a preliminary issue.