Mr Haughey denied that a land agreement between him and the Gallagher Building Group which helped him to pay off his debts to AIB bank was not a commercial deal.
He believed it was a "reasonable agreement", given all the factors and the pressures on him at the time.
He rejected assertions by counsel for the tribunal, Mr John Coughlan SC, that the £300,000 deposit paid by the Gallagher Group was "more connected with the office you then held as Taoiseach and the immediacy of discharging the indebtedness to AIB".
The deal, signed in January 1980, a month after Mr Haughey became Taoiseach, involved the sale of 35 acres of land at his Abbeville home in Kinsealy, Co Dublin, for £35,000 an acre to the Gallagher Group.
The Gallaghers would provide Mr Haughey with a stud farm of at least 60 acres of land with appropriate stables within 20 miles of the GPO. That cost would then be deducted from the price of the Abbeville land. If the transaction was not completed by December 31st, 1985, the deposit was non-refundable.
Mr Coughlan said it did not conform to standard legal documents, the price per acre was very high for the time and the land was zoned as agricultural with no plan to rezone it. Mr Haughey said in the housing situation at the time the Gallagher Group did not anticipate any problem with planning permission.
Counsel said that if there was any real commerciality to the deal it would have been more than enough to pay Mr Haughey's debt to AIB.
"In all the circumstances, bearing in mind that Patrick Gallagher was a friend and anxious to be of assistance, it was a reasonable agreement to enter into, having regard to all the factors," Mr Haughey said.
His advisers, Mr Michael McMahon and Mr Des Traynor, were dealing with "an immediate situation, where they had to get money to solve the pressing AIB situation. This deal need not necessarily come to fruition until five years later."
The Gallagher Group got into difficulty in 1982, counsel pointed out. The receiver found no evidence of any attempt by the Gallaghers or Mr Haughey to move the agreement along.
Mr Haughey said the deal was put together by two trusted advisers who believed it was in order. "Mr Patrick Gallagher has insisted that it was in his view a commercial transaction," he said.
