Short answer is we don’t know but the Irish Independent is today reporting that “it is understood that a small number [of Irish judges] are to [sic] trying to prevent loans being transferred to NAMA”. The Independent’s story is really focusing on Irish judges’ salaries and pensions, and the proposal to hold a referendum to reduce same, but the reference to NAMA is interesting. A long established principle is that a judge would resile him-, or herself from any proceedings in which their judgment might actually be, or perceived to be, compromised. And it would seem that if certain judges have been dabbling in the land and development game, and had borrowed heavily to fund their (ad)ventures then those judges might well be compromised in some of the many property-related proceedings that have flooded the Irish judicial system in recent times.
To become eligible for NAMA, one must have been a borrower from one of the five NAMA Participating Institutions (AIB, Anglo, Bank of Ireland, EBS and INBS), have had loans for “land and development” and have exposures that exceed a certain threshold (zero for Anglo, EBS and INBS and currently €20m for AIB and Bank of Ireland). It is indeed sobering to think that some in our judiciary might have loans of over €20m but on the other hand they may simply have borrowed thousands, or have loans that might not be considered significant.
NAMA does not ordinarily reveal the names of borrowers, citing commercial confidentiality and, in addition, certain provisions of the NAMA Act. The incoming Government has committed to creating a public register of loans in default in NAMA and there are moves afoot to bring NAMA within the ambit of the Freedom of Information Act. The public register would probably be the most promising way of establishing NAMA’s borrowers, or at least the subset that was in default (which from the most recent NAMA quarterly reporting is the majority of NAMA borrowers). So might we soon see a list of judges in default on their loans? And if we do, will there be a mad dash by the legal fraternity, and others, to see what cases they presided over in recent times? Aaah, for the good old days when a judge’s dalliance outside wedlock was the greatest scandal that might beset them…
UPDATE: 27th July, 2011. The Irish Independent (again) pulls at this thread and reports that “up to 10 judges” face financial ruin. The reporting is a little confused with claims in one part of the article that property and shares have dived in value which gives rise to the pending ruination. Elsewhere it is claimed that proposed changes to pay and pensions are at the root of the judges’ woes. There is very little by way of sources for the reporting – “the Irish Independent has learned”, “financial experts”, “informed sources” is the best the Independent can offer. Elsewhere the article claims that Irish judges are the best rewarded in Europe.
NAMA Wine Lake 
A lot of them would have invested in properties through Quinlan Private in particular, Ms Justice Fidelma Macken for example invested in the Four Seasons which had a loan from Anglo.
@Neil, thanks for that. To be clear, although Judge Macken has been publicly linked with Quinlan Private (now Avestus) before, for example in this reporting from Property
Week
http://www.propertyweek.com/quinlan-private/3047488.article
I have not seen any suggestion that she has any loan with a NAMA Participating Institution or any other institution, and that consequently she would be eligible for transfer to NAMA.
This might help explain the Master of the High Court Ed Honohan’s recent comments ;)
http://www.rte.ie/news/2011/0511/debt.html
Master H gets a mention is today’s IT. Seems his personal crusade is causing him to act above his authority. It’s pretty serious if Master H sees fit to influence what gets to trial.
http://www.irishtimes.com/newspaper/ireland/2011/0628/1224299679906.html
Apparently the Irish Legal profession as a whole is up to its neck in property related debt. When they were overseeing the legal documents on the many colossal deals over the boom years, Irish lawyers en masse decided to get in on the game for a slice of the action. They leaped in with abandon, to the tune of tens of millions in some cases. (Irish solicitors were always in the property game over the years anyway, including the more dodgy deals)
Anyway, surprise surprise; it turns out that our native legal eagles are even less competent at managing their property empires and finances than our developer and banking classes–if such a thing can be believed. They’re all broke. Justice Honohan’s comments above should be understood in the light of the fact that many of those being “hounded” by the banks are fellow members of his guild.
Which probably includes judges. If it turns out that justices preceding over property cases up and down the state are have themselves been bankrupted by such dealings… well, we’ll have ourselves another merry little Irish scandal on our hands. Let’s just hope the state doesn’t end up paying out several ‘luach seacht bhungalow’ again this time around.
The prominent Belfast solicitor Declan Rodgers is the owner of Clementine Developments which is mentioned in this BBC story.
http://www.bbc.co.uk/news/uk-northern-ireland-13788385
He got his timing horribly wrong, buying the scheme off another developer in July 2007.
Please allow me to use you site on behalf of small business people for a full disclosure of whose loans are in Nama, both in the case of individuals and companies.
Today a friend of mine, a small business person advised me of a bad debt to a company which unknown to him “was in Nama”. He would never have provided the service on credit if he had known this.
If a company is in receivership or liquidation company law requires that fact to be made abundantly clear through publication. Yet we have a situation whereby companies are clearly insolvent but their banks are allowed to transfer bank loans to NAMA without that fact being made public. This is non disclosure of a critical insolvency situation.
The non public disclosure could have the effect of a fraud based on that non disclosure against potential unsecured private business people struggling to make a living.
This point is equally relevant if any one of the directors of a company has loans that have been transferred to NAMA. Again that fact should be public information.
@Joseph, thanks for that contribution. But what difference does it make if the developer is in NAMA or remained at Anglo, AIB, BoI, INBS, EBS? NAMA just takes over the loans, and acts in the place of the original bank. What difference should that make to companies dealing with the developer?
@NWL
It makes a very big difference to a person who might want to trade with him.
The movement of the loans to NAMA is proof positive that all of that persons or companies loans are not being paid. It is no longer a matter of bank forebearance or calculated lending risk.
In reality, if not in a legal sense, it is a confirmation of insolvency.
The very fact that his loans are transferred means that he is insolvent, but has not been legally declared insolvent.
Many of these people are continuing to trade in these companies with no hint to unsuspecting creditors of their clearly insolvent position.
You will be aware of the destruction caused to many subcontractors and other service providers by many of these companies through non payment of debts. Yet for some of them, their insolvent positions are hidden by the cloak of NAMA. And they will continue to rack up debts from unsuspecting suppliers desperate for business. And sure enough, when NAMA appoints a receiver or liquidator, these debts incurred during the NAMA period will be left unpaid.
It is morally wrong and possible legally to hide this information.
@Joseph, I think I’d take issue with that. NAMA is taking over all loans over a certain threshold that relate to land and development at the five participating institutions. Regardless of whether or not the loans are performing and NAMA has confirmed that 25% of loans are performing so just because a developer has been transferred to NAMA doesn’t mean they are insolvent or indeed financially challenged. They might be 100% performing and transfer to NAMA will mean no difference to how the developer deals with subbies and others compared to when they were at their original lender.
@ Joseph Ryan / NWL,
Setting aside the NAMA/Not in NAMA, there is a question of fraudulent trading/reckless trading by directors.
I’ve no great insight into the legal standards required to charge people, but it’s been evident that many developer companies looked insolvent and continued trading. A quick google and there’s some good definitions and explanations in the linked (though I am taking it at face value that they know this area.
Click to access Directors%20Duties%20when%20a%20Company%20is%20Facing%20Insolvency.pdf
@Joeseph Why would your friend not provide a service to someone who had a loan transferred to NAMA ? This makes no sense. Just because a loan on a property has been transferred to NAMA does not mean the borrower should not be able to avail of services on credit. Remember any loan over 20M secured on a property in a NAMA bank was transferred. Many of these loans are performing.
I know of some people with loans in NAMA who are in no financial trouble whatsoever. It would be very dangerous to assume everybody in NAMA is in financial difficulty, this would lead to discrimination similar to what your friend would have done by not providing a service on this basis.
Room 101.
I am operating on the assumption that any person or company that has with loans in NAMA means that those loans are there because some of that person’s or companies loans are not being paid. In other words because they are technically insolvent.
It is those particular loans that I am referring to. In fact it is my belief that there are no other type of loans.
[I am aware of the Shovlin case still unresolved I think, where he said he was paying all loans etc….. That fact was clearly disputed. ]
PS Though not a legal person, I feel that my friend has a good case if he choose to sue NAMA for non disclosure of the true financial insolvency of the company it was dealing with. The amounts are of course small and any person this size cannot afford to take any bad debts through the courts.
@Room 101 @NWL
It looks like I need to reckeck some facts re the criteria for NAMA loans. But even if I conced your point about re 25% of all loand transferred being “performing”, my point is fully valid for the remaining 75%.
@Joseph A good example is Paddy Mckillen. If you look at his case it is evident that he is far from insolvent. I understand the perception from the general public is that if your loans are transferred to NAMA you are in financial difficulty but this is not necessarily the case. This view has been heightened recently because of all the receiver appointments by NAMA.
I agree that if somebody is insolvent there should be questions asked before providing services but there is no justification to not provide services just because somebody has loans transferred to NAMA.
@Room 101.
We will have to agree to disagree on this. Maybe you are right that all loans >20m are being transferred. However Section 84.4 of the NAMA Act says that in making its decision NAMA may (may) take certain factors into account re loan etc.
This is a definite legislation prompt re the quality of the loan or its underlying collateral.
Separately of course it allows NAMA wider functions.
I would like to get good references to this, as even after a little looking I have not be able to find much.
What is the exact legal position re eligibility.
Within that eligibility what criteria are being applied by the banks/Nama.
@Joseph, the NAMA Act and the NAMA (designation of eligible assets) regulation – both available here https://namawinelake.wordpress.com/about/ – might help you but in brief NAMA is entitled to taking over all loans that match the eligibility criteria, whether those loans are 100% performing, secured on the most blue-chip of assets and being repaid exactly in accordance with the original loan agreement
or
if they’re loans for fields in Athlone where the underlying security has dropped by 98% in value.
Room 101 helpfully mentions the Paddy McKillen case, where the developer, sorry “property investor”, went to a lot of trouble at the High Court to demonstrate that his loans were performing and not impaired, though he wasn’t 100% out of the woods because his definition of “unimpaired” was that the banks hadn’t issued default notices even when the loan repayment date had passed.