THE HIGH COURT
Record No. 2015/3350?

BETWEEN:


stamina
Mann-a 
narrate renters 

Defendant

AFFEDAVW ?it? MURPHY

1, DAVID MURPHY, Business Editor of Raidir?) Teili?s Eireann, of Montrose,
Dublin 4, aged eighteen years and upwards, MAW OATH and say as

  

personal ?nances of the Plaintiff as on the governance of IBRC 

follows:

1. I am the Business Editor of Raidio Teili?s Eireann the Defendant, and

Ixmake' this af?davit for, on behalf of and with the consent of the Defendant
from facts within my own knowledge save where otherwise appears and where
so otherwise app ears Ibelieve those facts to be true and accurate. 

I beg to refer to the proceedings and pleadings herein when produced. I make
this af?davit in response to the Plaintiff 5 application for interlocutory
injunctions by Notice of Motion dated 30th April 2015 and to the grounding
af?davit thereof ?sworn by the Plaintiff. on the 30th April 2015 (hereafter ?the
Plaintiff?s affidavit?).

I am Currently working on arshort news report, which, inter alia, examines
efforts by the Plaintiff, in 2012/2013, to seek an extension to the repayment
period of loans he had with the Irish Bank Resolution Corporation 

formerly Anglo Irish Bank. The fobus of the report is not   

     

This news report was originally due to be broadcast on the Six: One news
programme on 1st May 2015 but it was postponed until 5th May 2015 to give the
7 parties concerned additional time to reply. The broadcast is now further
postponed pending a determination of the present injunction application.

As averred to by the Plaintiff at paragraph 8 of his affidavit, a letter dated 28th
April 2015 was sent to the Plaintiff informing him of certain matters and

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offering him a right of eply prior to broadcast. Letters in similar terms
were sent to the former CEO of IBRC, Mr Mike Aynsley, the former head of
specialised asset management, Mr Richard Woodhouse and the Special
liquidator, Mr Kieran Wallace.

The Defendant is in possession of information relating to certain loan facilities
which the Plaintiff had with IRBC. I assert journalistic privilege over the
identity of the source of this information.

As the draft script reveals, it is no part of the Defendant?s intent to assert any
wrongdoing, iniquity or misdeed by the Plaintiff or by the liquidators of IBRC. I

However,RTErl does assert that the dealings bettveen the Plaintiff and the fenner
management of and between the Plaintiff and the liquidators. of IBRC are
matters of legitimate public interest outweighing the acknowledged interest of
the Plaintiff and the bank in the con?dentiality of their business relationship 
such that no interlocutory relief should be granted.

Rents ?9Brien

9.

The Plaintiff is a billionaire businessman of international renown who has been
in the public for the last two decades. In 1995 he set up and chaired the Esat
Telecom Group which won the second mobile phone licence granted in the
State.

Having sold Esat Telecom Group, he established and chairs the Digicel Group 
a major telecoms provider in the Caribbean of which he owns 94%. The Digicel
website describes him as ?one of Ireland ?5 leading entrepreneurs with extensive
investments across several sectors including international telecoms, radio,
media, property, aircra? leasing; golfand other leisure interests. 

Group Ltd, founded and owned by the Plaintiff, describes itself
as lreland?s premier media company and the home of some of Europefs leading
commercial media brands. Communicorp owns and operates some of the'largest
independent radio networks in Ireland, Eastern Europethe fastest growing radio networks in the world with 27 radio stations in a
number of European countries including two national radio stations Newstalk
and Today PM and Dublin?s 98PM. Via Communicorp the Plaintiff is the
largest owner of private radio stations in lreland.

The Plaintiff is also the largest shareholder in the independent News 
Media group arguably Ireland?s largest media group. He has signi?cant

7  interests in othergprominent- companies--?--includingTopaz which; -
stations across Ireland, describes itself as on its website as ?Ireland?s largest fuel .

and convenience brand?, and the Siteserv Group, which is involved in
infrastructure and facilities management, including the installation of water
meters.

He has been a deputy Governor of the Bank of Ireland.

The Plaintiff has featured in the public spotlight for numerous other reasons
including very signi?cant philanthropy, his investment in Celtic Football Club
in 2001, his chairing of the Special Olympics in 2002/03, his financial

contributions to Irish sport including the part-funding of the remuneration of 

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10.

EBRC
1 1.

the manager of the Irish soccer team, his featuring in the Moriarty Report in
2011 and his appearance with the Taoiseach for the ringing of the opening of the
New York stock exchange in 2012. He is a member of the UNESCO Broadband
Conunission for Digital Development.

The Sunday Independent Rich List published on Itth May 2014 stated his net
worth to be approximately ?38 billion and Forbes magazine now estimates it at
$6.9 billion.

As such the Plaintiff has inevitably and knowingly exposed himself to close
scrutiny of his acts by the media. In this regard, I beg to refer to profiles of the
Plaintiff from the Forbes, Digicel and Communicorp websites and certain
extracts from the Communicorp website upon which pinned together and
marked ?Dirt 2? lhave signed my name prior to the swearing hereof.

i also beg to refer to a pro?le which currently appears on the Irish Indeperzdem?
website and was first published on 8th March 2015 upon which marked 
lhaye signed my name prior to the swearing hereof.

Accordingly I respectfully say that the Plaintiff plays and. has for many years
played a significant role in the State?s business life and its public life and while
his rights to privacy and con?dence are to be respected, nonetheless he is a
person of whom it can be said that his affairs are of legitimate public interest 
particularly where they interact with State interests and where they have
?nancial implications for the State. He has been, insofar as relevant to these
proceedings, a very major debtor to the State in the form of IBRC. He is, it is
suggested in the category of businessmen whose positions lay them open to
close scrutiny by the press.

While it is not feasible to set out the history of in detail, by way of
background, in part taken from the Department of Finance website:

a. In lanuary 2009, as a result of the national banking crisis, the former Anglo
Irish Bank was nationalised pursuant to the Anglo Irish Bank Corporation
Act 2009 the long title to which described it as An Act To Provide, In The
Public Interest, For Maintaining he Stability Of he Financial System In
The State. Section 2 of the Act recorded that the Minister for Finance:

?has, in the publicinrerest, the functions provided for under this Act

because, a?er consulting the directors of Anglo Irish Bank, the

Governor and the Regulatory Authority, the Minister is of the opinion

  .m .. .. . a.  ma 

there are serious concerns about the viability of Anglo Irish Bank,
or would be if those functions were not performed,

and

the performance of those functions is necessary, in the public
interest?n

h) to remedy a serious disturbance in the economy of the Store,

 

 

 

 

 

 

(ii) to prevent potential serious damage to the ?nancial system in the
State and ensure the continued stability of that system, and

to preserve the capacity of Anglo Irish Bank to continue its
operations as a going concern. 

h. The State invested billion in ordinary shares in Anglo Irish Bank in June
2009.

c. The nationalisation of both Anglo Irish Bank and Irish Nationwide Building
Society was provoked by their insolvency which required State
investment of tens of billions of euro. This was a signi?cant element of the
national harming crisis of that time.

d. The State made a capital injection of ?100 million in the Irish Nationwide
Building'Society in 2.010.

e. Additional capital injections into Anglo lrish Bank and MRS were by way
of promissory notes and by December 20l0 the total promissory notes
held by Anglo Irish Bank and INBS was 630.6 billion. The promissory
notes were exchanged for a portfolio of long-term government bonds.

f. In July 2011, Anglo Irish Bank was merged with the Irish Nationwide
Building Society, to form the IBRC. IBRC is wholly State-owned.

g. In March 2012 pursuant to Section 3 of the Anglo Irish Bank Corporation
Act 2009 the Minister For Finance speci?ed a Relationship Framework for
his relationship with IBRC, the preamble to which recorded that ?In the
context of the ?nancial crisis, the Bank has received and continues to
receive signi?cant support from the State to prevent potential serious
damage to the ?nancial system in the State. This support takes various
forms, including capital injections, asset relief and various guarantees.?

h. The Relationship Framework, inter alia, identi?ed the objectives of the
Minister for Finance as including:

a to minimise cost and other risk to the Exchequer and the taxpayer; I 
to remedy a serious disturbance in the frish economy by helping to
restore the reputation and enhance the stability of the ?nancial system

in the State;

a to ensure that the Bank operates in accordance with the pubiic interest.

 

 

       

from the Irish Bank Resolution Corporation Act 2013 legislation passed
overnight by the Oireachtas. The recitals to the said Act state the following:

i. WHEREAS it is necessary, in the public interest, to provide for the
orderly winding up of the affairs of IBRC to help to address the
continuing serious disturbance in the economy of the State

ii. AND WHEREAS vital assistance has been provided by the State to
maintain the ?rnctioning of IBRC to support the financial stability
of the State; .

 

 

 

 AND WHEREAS vital assistance has been provided by the Central
Bank of Ireland to maintain the functioning of IBRC to support the
stability of the Irish ?nancial system;

iv. AND WHEREAS the maintenance of the ?inctioning of IBRC is
no longer necessary to support the ?nancial stability of the State or
the stability of the Irish ?nancial system;

v. AND WHEREAS it is necessary to end the exposure of the State
and the Central Bank of Ireland to 

vi. AND WHEREAS the winding up of BRC is now necessary to
help to restore the ?nancial position of the State and to help to
enable the State to reestablish normalised access to the
international debt markets;

vii. AND WHEREAS it is necessary in the public interest to ensure
that the ?nancial support provided by the State to IERC is, to the
extent achievable, recovered as fully and ef?ciently as possible;

AND WHEREAS the winding up of IBRC is necessary to resolve
the debt of IBRC to the Central Bank of Ireland

ix. AND WHEREAS in the achievement of the winding up of IBRC
the common good may require permanent or temporary
interference with the rights, including property rights, of persons;

One of the purposes of the liquidation, according to the Department of
Finance, was to ?improve the health of the Irish banking sector in
place a longer-term solution for a significant part of the structural shortfall
of bank ?nancing that has emerged throng}: the banking crisis. .

The liquidation is, in ?nancial terms, the largest liquidation in the history of
the State. Assets of enormous value, effectively State property, in
particular loans and portfolios of loans have been sold by the liquidators.

Though it is generally believed to have proceeded successfully, at its
commencement the liquidation involved significant risk to the State. Inter
alia, according to the Department of Finance, ?If, after an independent
evaluation exercise, the value of the assets sold by the Special Liquidators is

not suf?cient to compensate NAMA for the amount it paid for the net IBRC 

debt owed to the Central Bank, the Minister for Finance will be required to
reimburse NAMA for the shortfall. If on the other hand, the value of the

 

 

ear  44> I 

retain surplus assets for the bene?t of other unsecured creditors, including
possibly refunding the State for payments made under guarantees.?

. As to the effect of the liquidation on borrowers from Anglo Irish Bank (as it
was when lending), it was envisaged that many loans would be sold to third
parties and according to the Department of Finance ?All debts to IBRC
remain due and payable in accordance with their terms. All loan payments
should continue to be made. The Special Liquidators will he in direct
contact with IBRC borrowers to notify them of any potential changes to
payment details as a result of the liquidation. One of the objectives of the

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12.

Special Liquidators will be to achieve the best valuation of these assets
through the liquidation, which includes continuing to collect on all
outstanding debts.?

I say and believe that the history recorded above, albeit brie?y, demonstrates
that the affairs of IBRC, both before and after its liquidation have involved huge
?nancial investment by and risk to the State and are matters of very signi?cant
public interest. An element of that public interest relates to the manner in which
both before and after its liquidation has dealt with its substantial debtors.

Eontroversy as to Governance of BREE

13.

14.

15.

According to documents released under the Freedom of Information Act 2014,
prior to the liquidation of IBRC in February 2013, the governance of 
large transactions by its management became an issue of significant concern for
the Department of Finance.

The Department?s brie?ng note in preparation for a meeting between the
Minister for Finance and the Chairman/C130 of scheduled to be held on
25th July 2012, inter alia: 

it. refers to a ?continuing lack of regard for the views of the Department
and Minister by senior management in IBRC 

b. records concern at the relationship between the CEO and a named major
debtor (not the Plaintiff).

c. states ?we are concerned at the large number of transactions that have
been poorly executed under the direction of the current CEO. The
performance of management in executing these transactions raises the

question of the effectivaness of the CEO. The poor management .

displayed  along with the increased level _of public concern
and political and media scrutiny that they commanded is damaging the
credibility of the institution and by extension the State 

Among these transactions were the well-publicised Siteserv transaction
of March 2012,; the sale of an office block in the US called Apthorp; the
appointment of private equity group Blackstone without proper
procedures; and the sale of the IBRC Wealth Management Unit. 

The attached speaking notes

a assert the need to ?ensure that business is conducted at the bank in a

7 . mannerwhieh deer stalemate. the bank nanometre?criticism. In is

 

 

clients 

a record ?extreme? dissatisfaction flwith the performance of IBRC
management?.

I beg to refer to a true copy of the briefing note upon which marked with the
letters 4? have signed my name prior to the swearing hereof.

The minutes of the meeting of 25?11 July 2012 between the Chairman/CEO of
IBRC and the Minister for Finance highlight the Minister?s concerns about

.6

particular palettes "relating with   

 

 

 

 

 

l6.

I7.

18.

governance of the bank and, in particular, rumours of close relationships
between senior management of the bank and large clients. it was acknowledged
by the then CEO of the bank that there were close relationships with large
clients but he asserted that these relationships were not He
represented that "the clients are managed to ensure a maximum return on all
loans.? and continued a strong but not inappropriate relationship with the
Plaintiff herein.

in this regard, i beg to refer to a true copy of the minutes upon which marked
with the letters ?Eh/i s? I have signed my name prior to the swearing hereof.

in relation to the sale of Siteserv which came, in effect, under the control of

the Plaintiff and in which over (?100 million of its debt was written off at loss to
the State the Department of Finance raised concerns about the decision to
allow the sales process to be conducted by Siteserv?s advisers; the decision to
exclude trade buyers; the timing of exclusivity when other bids were
outstanding; and the decision to make a payment of as million to shareholders.
This transaction, amongst others, has recently been the subject of a request to the
special liquidators to review IBRC transactions involving the writing off of
debts in excess of ?10 million. emphasise that it is no part of present
concern to assert any wrongdoing by anyone in particular the Plaintiff as to
the sale of Siteserv. The issue is relevant as a public controversy as to the
governance of IBRC in circumstances in which the dealings between the
Plaintiff and IBRC raise concerns as to the governance of in terms similar
to some of those articulated by the Department of Finance. It will be seen that
the draft script does not mention Siteserv.

In this regard, I beg to another Department of Finance brie?ng note upon which
marked with the letters 6? have signed my name prior to the swearing
hereof.

This note also records the Department?s considerable dissatisfaction as to:
i. the relationship between IBRC management and the Department

ii. the relationship between management and IBRC clients and
reputational damage in consequence.

However the Plaintiff is not one of the IBRC clients mentioned - nor is it
asserted that the Department had him, as it were, in mind.

As recently as yesterday evening there was discussion in Dail Eirearm in respect

  duringdebate 0n aprivatemembersbill. lnthisregardlbeg .. .. . .. ..
refer to a transcript of the debate upon   

 

 

I have signed my name prior to the swearing hereof.

Relationship Between Denis O?Brien and HERE Premhiqutdation

19.

RTE has come into possession of certain documents relating to the Plaintiff?s

borrowings from IBRC and the management thereof by IBRC both before and

after the commencement of the liquidation. I do not exhibit or identify those

documents as am fearful that by doing so I may disclose or tend to disclose the

identity of the source thereof. 1 say that the account hereunder of my

understanding of the dealings between the Plaintiff and is based on those
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documents 

28,

29.

30.

32.

 

 

 

such assertions are made against a backdrop of recorded concern by the
Department of Finance as to:

a management by senior EBRC management of relationships with major
borrowers/clients;

dissatisfaction with the performance of senior 1BRC management5 inter
alia, as to large transactions;

a reputationai damage to the State arising out of the foregoing33respectfully suggest that, from the point of View of the public interest,
knowledge of these matters is relevant as bearing on:

     



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The Public interest Further @hservations

39stated above, the brie?ng notes obtained under the Freedom of Information
Act 2014 illustrate that the Department of Finance, which represented the
interests of the taxpayer, had signi?cant concerns about the governance of large
loans in IBRC. When anything less than full value was achieved it was at a loss
to the public purse at a time when the public ?nances were under exceptional
pressure.

I believe that the publication of the information in the Defendant?s possession,
in terms contemplated in the draft script, even though con?dential, is justified on
the grounds of public interest for a reasons as set above and on which i will
elaborate further below. 

There is, I believe, a public interest of a real and weighty nature in publishing
information about the manner in which the dealt with the Plaintiff as one
of its most signi?cant debtors. Such interest arises in circumstances where the
bank has been bailed out by the public, the debts of the bank have been taken by
the people of lreland and the bank was run at the direction of or by persons
appointed by the Minister for Finance. Against this background, there is a

particular public interest in knowing certain inferrnation about the relationship

between the bank and its principal customers.

The Plaintiff?s dealings with are of themselves a matter of legitimate
public interest given the size of his debt, his ?nancial power, the fact that he has
purchased assets from IBRC and his role in Irish life as described above.

 

he public will also have a legitimate interest in contrasting IBRC dealings
with a major debtor with its dealings with other debtors.

For the avoidance of doubt, I reiterate that nothing known to me indicates that
the Plaintiff has engaged in wrongdoing, iniquity or misdeed. Rather, it is the
prudent management of one of the bank?s hey clients is being called into
question as is whether the taxpayer?s interests were best served.

In light of the'foregoing, I believe and are advised that there is a suf?cient
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4-8.

49.

50.

public interest to disPlace any con?dentiality that exists between the Plaintiff
and his bankers and, in this particular case the public interest in disclosure
outweighs the Plaintiff?s right to privacy and con?dentiality. I believe that the
publication of the neWs report will make a contribution to a debate
of general and genuine public interest.

I do not accept that the Plaintiff would suffer inoperable damage as a result of
the news report that the Defendant intends to broadcast. believe and am
advised that any harm caused to the Plaintiff by the news report (and i do not
believe that they will be any) would be reparable or compensated by an award of
damages.

In particular respect?illy say that, financial institutions would ?not litre? to see
the publication made is, it is suggested? completely irrelevant in itself. Moreover
given his economic power5 the suggestion that if the intended publication were
made financial institutions would refuse to deal with the Plaintiff is fanciful in
the extreme and, in any event, unsupported by evidence.

Accordingly pray that the relief sought in the notice of motion be refused.

SWORN by the said DAVID MURPHY this
 day of  2015 at

{g Litiva Taffeta?a

   

 

     

   
   

aciPractising Solicitor and I
personally know the Deponent  Lat-as a?
  

.. a .. j-egg?epg?ahaambeen

fairs,

eto'tgrafoirof

   

 

This Af?davit is filed on behalf of the Defendant by RTE Solicitors? Office3
Montrose, Dublin 4, this 7th day of May 2015.



in the County of before me a

 



 

 

 

 

 

 HEGH EOURT

Record N0. 2015/3350?
BETWEEN:

P?afm??
gm?
MDM imam
Defamdam

AFFEDAWT DAWD MURPHY

 

RTE Solicitors? Of?ce
Montrose


Dublin 4