Advance knowledge of article was known to Bailey

Mr Michael Bailey knew in advance that an article would appear in the Irish Independent relating to alleged payments to Mr James Gogarty, Mr Bailey acknowledged at the tribunal yesterday.

Yesterday's editions of the Irish Independent carried a report by Sam Smyth in which it was stated that next week's cross-examination of Mr Gogarty would concentrate on alleged payments to Mr Gogarty from Mr Bailey.

The article further claimed that Anglo Irish Bank had made submissions to the tribunal regarding its transactions with Mr Bailey.

The submissions allegedly relate to Mr Bailey's comments that he needed money to give Mr Gogarty.

Mr Bailey told the tribunal that he had a conversation with his public relations adviser, Mr Pat Heneghan, on Monday, in which Mr Heneghan had spoken of Smyth's intention to write an article about the alleged payments to Mr Gogarty. However, Mr Bailey denied that he had given any instructions on the matter.

Mr Bailey said he had not seen a narrative statement from the Anglo Irish Bank, which may have assisted in the preparation of Smyth's article, before it was put to him on the witness stand yesterday afternoon.

A solicitor and partner in the firm of Gerrard Scallan and O'Brien, Mr John Glackin, told the tribunal that he had sent documents from Anglo Irish Bank to Mr Bailey's solicitors, Smith Foy & Co, on Friday last. Mr Michael Foy acknowledged that the firm had received them on Monday morning. Acknowledging that he knew on Monday that an article was being planned about the alleged payments, Mr Bailey denied that this knowledge was based on sight of the narrative.

He said he was surprised when he saw the detailed allegations contained in the article in yesterday's newspaper. He had previously arranged to meet Mr Tom Browne, banking director of Anglo Irish Bank, at 8 a.m. in Dublin yesterday. He kept the appointment and over breakfast the subject of the article arose. Mr Bailey said Mr Browne suggested that they go to Anglo Irish Bank and consult Mr William Barrett's contemporaneous notes of the 1989 meeting with Mr Bailey.

The notes made by Mr Barrett in 1989 referred to Mr Bailey's stated intention of making payments to Mr Gogarty, it was alleged in the article.

Mr Bailey added that it was the second time that he had seen these notes, the first being some six months previously.

However, giving his evidence, Mr Browne, while corroborating Mr Bailey's recollection of yesterday morning's breakfast meeting, added that Mr Bailey had telephoned him "within the last two weeks" to say that he had seen the narrative statement and was happy with it.

When Mr Bailey's testimony appeared to contradict this, Mr Browne was called back to the stand. He repeated that it was his understanding from Mr Bailey's telephone call that Mr Bailey was referring to the narrative statement, not merely the contemporaneous notes, when he said he had seen it and was happy with its content.

Under cross-examination from Mr Brian O'Moore SC, for Mr Gogarty, Mr Bailey said his solicitors had never passed the narrative statement on to him and they had never discussed its contents with him.

It was then put to Mr Bailey by Mr O'Moore that one of the most important parts of his own statement to the tribunal was the matter of payments to Mr Gogarty. Mr Bailey agreed that this was so.

"And the statement which you have just read while you sat in the witness box, the statement from Anglo Irish Bank, is clearly, from what we read in today's [Wednesday's] newspaper, of central importance as far as that allegation is concerned." Mr Bailey agreed "that may be".

Mr Eamonn Leahy SC, for Mr Bailey, then objected, saying the cross-examination was "now close to client's instructions" which were confidential. Addressing Mr Justice Flood, Mr Leahy said "if it is your ruling that he is obliged or forced to answer questions in relation to instructions, I would welcome some guidance from you sir, as to the power that gives that ruling".

Mr O'Moore asked Mr Bailey who knew about the morning meeting with Mr Browne. Mr Bailey replied "no one". Asked to consider his answer, Mr Bailey said: "I advised Mr Allen [Mr Colm Allen SC, his counsel] last night." Mr Bailey said the meeting was not the prime topic of the conversation which had related to Mr Allen's health and his plans to stay away from the tribunal yesterday.

In response to Mr O'Moore, Mr Bailey said it was true that he had rung Mr Allen the previous night, that he had gone to a meeting "on unspecified business" with Mr Browne, that Mr Browne had shown him the file containing the contemporaneous notes and he had contacted Mr Allen again.

Mr Bailey said Mr Heneghan had told him that "Mr Smyth had talked to him" and Mr Heneghan concluded that there would be an article about alleged payments. He did not instruct Mr Heneghan to find out any more information.