Dalys settle case over €457m loans

The legal action by developer David Daly and his family over the takeover of their €457 million loans by the National Assets Management Agency (Nama) has settled, the Commercial Court was told today.

No details of the settlement were disclosed.

Mr Justice Peter Kelly was told by lawyers for both sides the case would not be proceeding, had settled in full against Nama and had also settled against the other defendants - the State and Allied Irish Banks - except in relation to issues concerning legal costs.

The costs bill is likely to be substantial.

The judge was told by Paul Sreenan SC, for Nama, the case had settled on all issues against his side and could be struck out with no order for costs against the Nama side, which included various receivers appointed by the agency over assets of the Dalys.

Michael Cush SC, for the Dalys, said the action against the other defendants - AIB and the State - had also settled with the only issues outstanding relating to costs.

The sides wanted the case listed next month to address the costs issues, he said. Mr Justice Kelly made the orders sought and adjourned the costs issue as requested.

David Daly, his daughter Joanne and son Paul secured leave last September from the Commercial Court to challenge the demand by Nama to repay the €457 million loans.

However, they failed to get injunctions restraining the activities of AIB-appointed receiver Jim Hamilton over their Irish assets or of Nama-appointed receivers Shay Bannon and Sarah Rayment over UK assets, including trophy properties in London’s Bond Street such as the Louis Vuitton building.

Mr Justice Michael Peart granted them leave to proceed with their legal challenges on the family’s contention they should have been heard by Nama prior to the agency deciding to issue letters of demand for repayment of the loans.

David Daly, of Estuary House, New Street, Malahide, Co Dublin, had told the court he had set up Manor Park Homebuilders with Jim Flavin and Joe Moran and used his share of the profits from that venture to build a property portfolio.

In 1995, he was bought out and had set up Albany Homes Ltd and Trident Home Builders Ltd. He used AIB as his personal banker.

Mr Justice Peart noted assets totalling €80 million had been transferred by Mr Daly into his wife Mary’s name, including about €17 million in cash.

Mr Daly told the court this had been done in 2009 as part of tax planning and on the advice of his accountants and had asserted there had been nothing unlawful in doing so.

It was quite clear from correspondence between Nama and Mr Daly that Nama regarded it as fundamental to any consensus on a way forward that these assets would be transferred back by Mrs Daly so they would be available to Nama, the judge noted.

In negotiations, Nama had agreed with Mr Daly to reduce the cash hand-back element from €17 million to €10 million, but Mrs Daly had not been willing to transfer back all the assets Nama demanded.

Mr Daly had believed this was the main reason why Nama was unwilling to reach agreement with him while Nama stated it was an important issue but not the only one that prevented agreement.

The Daly family claimed the decision to call in the loans and appoint receivers should be quashed on the basis they lacked proportionality and reasonableness for failing to await the conclusion of negotiations they believed had been ongoing between Nama and Deutsche Bank about a take-over of the loans.

Mr Daly told the court he feared the family’s assets would be sold off at a huge loss in a fire sale, resulting in complete loss of interest by any other bank taking over the loans.