Olwyn Enright (Laois-Offaly, Fine Gael)
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Question 19: To ask the Minister for Tourism, Culture and Sport whether she has received details of any outstanding liabilities arising from a recent court case (details supplied); if the parties involved have already or plan to re-enter arbitration; and if she will make a statement on the matter. [36750/10]

Mary Hanafin (Dún Laoghaire, Fianna Fail)
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A lease for the operation of the National Aquatic Centre, which was constructed by the former Campus Stadium Ireland Development Limited (CSID), was agreed in April 2003 between CSID and Dublin WaterWorld Ltd. As was provided for under the VAT legislation in force at that time, a VAT invoice for €10,254,600 was issued to Dublin WaterWorld Ltd. upon the creation of this lease. As this payment was not made by Dublin Waterworld Ltd. CSID, at a meeting in September 2003, instructed its legal advisors to proceed to recover the outstanding amount.

The non-payment of this VAT invoice was among a number of breaches of the lease subsequently lodged in a Statement of Claim by CSID with the High Court (Commercial Court) in 2005. The outcome of the substantive proceedings in this matter was the vacating of the Centre by the previous operator and its return to the direct control of the former CSID, now the National Sports Campus Authority (NSCDA).

The question of the VAT charge on the lease of the National Aquatic Centre was referred by the High Court to Arbitration and following the submission of documents an oral Arbitration was held on 28 June 2005. The Arbitrator found that the amount of VAT charged by CSID on the capitalised value of the lease to DWW was correctly charged. The matter was returned to the High Court which upheld the Arbitrator's award. The defendant – Dublin WaterWorld Ltd. – appealed this judgment to the Supreme Court. The matter came before the Supreme Court in November 2009, and the findings of the Court were issued on 30th April last. In a further hearing on 11th May, the Supreme Court ordered the award of the arbitration be set aside and that the matter be referred back to an independent Arbitrator for further consideration.

The Court also made an award of costs in respect of the High Court and Supreme Court proceedings in favour of the defendant/appellant – Dublin WaterWorld Ltd. The level of such costs is yet to be determined and may in time be decided upon by the Taxing Master. Following the issuance of the Supreme Court decision, the National Sports Campus Development Authority considered the matter in detail and sought the advice of its legal and tax advisers on the implications of this ruling. The Authority has since decided that it would be prudent and in the best interests of the Authority not to proceed any further with the Arbitration process. The Authority has conveyed its decision to the legal representatives of Dublin WaterWorld Limited.