The top executive in Ireland's toxic assets management agency has this morning described a ruling in favour of developer Paddy McKillen by the Supreme Court as "disappointing".

Mr McKillen, who is originally from Belfast, won his appeal against the transfer of €2.1bn in loans to the National Asset Management Agency (NAMA), a Government agency created to deal with toxic loans mostly taken on by developers during the property boom.

Mr McKillen was the developer behind the Jervis Shopping Centre in Dublin and argued his property portfolio was performing "excellently" and shouldn't be acquired by NAMA.

Dublin's Supreme Court ruled that NAMA did not make a valid decision to acquire his loans and that the decision was made by an interim team in December 2009, before NAMA had been set up.

This morning, NAMA Chairman Frank Daly said the outcome of the hearing was "obviously a disappointment", especially as the High Court judgement found comprehensively in favour of NAMA in a number of other areas.

Mr Daly said it was important to note that the decision related specifically to the case taken by Mr McKillen and did not have implications for other acquisitions completed by NAMA and that the Supreme Court had ruled firmly that NAMA did not breach State Aid rules.

The Irish High Court had previously dismissed Mr McKillen's challenge to NAMA over his loans. The developer then appealed the case to the Supreme Court,which today ruled that a decision to acquire his loans by an interim team had no legal effect.

Seven judges found in favour of Mr McKillen's position that the powers of NAMA did not cover his particular case.

The court ruled that this was not a purely technical or formal point, but an essential step in the statutory process.

The court added that it was satisfied the decision made by the interim team had no legal effect and, contrary to the High Court decision, was not given any legal effect by the subsequent actions of Nama.

It also found that Nama had not breached the European Commission's decision approving it.

The court will sit next Wednesday to hear submissions on the other aspects of Mr McKillen's appeal, however, the Nama Chief Executive added that his team would study the ruling carefully over the coming days and reflect on the options ahead.

(DW)