CIE chief executive Mr Michael McDonnell's claim that he is entitled to an £80,000 (€101,579) a year pay rise will be heard by the High Court on December 21st.

Yesterday's application by Mr McDonnell (58) for an order restraining the company from changing his contract - which was amended last year to provide for a salary increase from £100,000 to £180,000 per annum - was adjourned when lawyers for both sides agreed further documents had to be exchanged before the hearing could go ahead.

As well as the salary rise provided for in the amendment to Mr McDonnell's contract, he also received substantial increases to his pension entitlements.

It is understood Mr McDonnell will claim he is entitled to the improved contract. CIE will claim it was never approved by either the Department of Public Enterprise or the Department of Finance.

It is also understood Mr McDonnell has indicated his willingness to take early retirement but on the terms of the disputed contract. This would give him a pension of more than £90,000 a year and would allegedly cost the pension fund more than £1 million.

Yesterday, Mr Bill Shipsey SC, for Mr McDonnell, told Mr Justice Kearns his client was seeking an interlocutory injunction (a restraining order which would continue until the hearing of Mr McDonnell's action). He said CIE had delivered a replying affidavit just that morning and he needed time to consider a reply.

Mr Shipsey asked that the matter be adjourned but urged an early hearing. He said the matter was urgent as the salary due to Mr McDonnell last week had not been paid.

Mr Eoghan Fitzsimons SC, for CIE, said the salary payment would be paid this afternoon. He consented to an adjournment.