Legally bound: why did it take media revelations and public anger for Brian Lenihan to find a way to withhold AIB's staff bonuses?

Brian Lenihan laid it out plainly on Morning Ireland last Tuesday. "This is not an easy country, legally speaking," he said. He was referring to what he claimed was the difficulty in stopping the payment of €40m in bonuses to AIB staff. Up until the previous evening, he and AIB had claimed there was no way around paying the bonuses. The law insisted it was so. AIB had received legal advice to that effect, the government accepted it, and there was nothing anybody could do.

Then, following media revelations, which in turn exercised further political pressure, hey presto, the accursed law was defeated. Lenihan, the majority shareholder in the bank, just wrote a letter saying no more of the citizens' money will be forthcoming if the bank wishes to throw it around in bonuses. The bank could effectively claim inability to pay. It was so blindingly obvious, the question immediately arose – why did some of these geniuses not think of it before then? Why did it take growing anger among the public for the bleedin' obvious to be invoked?

Lenihan himself is a senior law maker and a senior counsel. He has been aware of the proposed bonus payments for some time – he provided a written answer to a parliamentary question on the matter on 1 December. How come neither Lenihan nor anybody in his department saw that there was a way in which the state could exercise moral authority over the institution it was propping up?

For AIB's part, it employs top legal firms to proffer advice. If these companies are typical of the legal business, they charge exorbitant fees. How come nobody in the bank or its legal armoury saw the blindingly obvious way around shelling out this money? How come everybody accepted a basic interpretation of the law, and left it at that? Could it be that the law was seen as a convenient tool rather than an obstacle? Could it be that management at the bank had no issue with paying out these bonuses, despite the perilous state of the institution's finances?

The bank bonus affair highlights once more the manner in which the law is used in the centres of power. In this case, AIB was the entity apparently using the law to protect vested interests against the greater public interest. The bank has quite obviously picked up tips from government, for hiding behind legal opinion is something of an artform in government. It has been used down through the years to protect special interests, sometimes with devastating results.

In 1974, the law was unilaterally invoked to protect landowners, who are great people for funding the main parties. A committee charged with investigating planning, corruption and how best to advance the interests of the state in the area of building land, reported to the Fine Gael-led government. It recommended that rezoned land be sold at its agricultural price plus 25%. The committee was chaired by a High Court judge, John Kenny, whom we might assume had considerable knowledge of the law.

Yet the recommendation was thrown out on the basis that there might be constitutional problems with it. There was no exploration of the matter. It is not even clear whether specific legal opinion was sought. Had the measure been implemented, it would have alleviated corruption, bad planning, and ultimately ensured that the worst excesses of the building bubble of the last decade were avoided. But the government sat on its hands, claiming they were tied.

In the 1990s, the law was invoked to hound Brigid McCole all the way to her death bed when she sought answers and redress for being poisoned with infected blood. The foremost concern for the government was to protect the exchequer from aggrieved citizens, even if that meant lowering themselves into a moral pit. Again, the government invoked the law to subvert the wider public interest.

One of the more shameful episodes in the past decade was the delay in introducing mandatory breath testing for drink-driving. The measure was proposed in 1999, but the government claimed there were constitutional problems. In reality, the imperative was to protect the interests of publicans, who were opposed to the measure.

Seven years later, with the carnage on the roads continuing unabated, and the power of the publicans on the wane, mandatory testing was introduced. In the end, there was no problem with the constitution. How many lives might have been saved if the government hadn't hidden behind what was represented as the unyielding arm of the law?

The recession has made no impact on the cynical use of the legal shield. Legal opinion dictated that judges' pay could not be touched last year when everybody else in the public service was taking a cut. The last thing the government wanted was a confrontation with the judiciary over pay, and the advice was that it was a no-go area. How convenient. A number of legal experts afterwards disputed this advice, but it was left alone.

Similarly, when it was decided to discontinue the crazy practice of allowing serving parliamentarians to continue to draw a pension, the legal opinion said don't go there. Lenihan backed off, refusing to confront any of his colleagues on the matter. Who among them would have taken a legal action demanding the right to a pension while still drawing a salary? What chance would they have had of success?

So Lenihan may well declare that this is not an easy country, legally speaking. He could have added that the crowded legal framework also comes in extremely handy for governments looking for an excuse not to do the right thing.

Interestingly, one area where the law does not appear to be in any way onerous is white-collar crime. The results of that culture are there for all to see. Three years into the recession, not one individual has been brought before the courts. Two files went to the DPP last week, although that's still a long way from a prosecution.

In a society where politics has such a close and beneficial relationship with business, a proper framework of law was never constructed to ensure that business was kept honest. Such formalities between friends is just not the done thing.