THE Moriarty tribunal is set to face another legal challenge, this time over its interpretation that a $50,000 cheque given to Fine Gael by Esat Digifone shareholder Telenor falls within its terms of reference.

The Sunday Tribune has learned a legal opinion, given to Esat founder Denis O'Brien by top senior counsel and former attorney general John Rogers, strongly disputes this. It is likely to form the basis of a fresh legal challenge.

The opinion states that the Oireachtas "did not mandate an inquiry into payments to Fine Gael, whether by Telenor or any other entity" but drew up terms of reference "sharply focused" to "catch accounts and monies" that may have been paid to Charles Haughey and Michael Lowry.

This backs up legal advice received by both Fine Gael – from senior counsel James Nugent – and Telenor.

The tribunal spent considerable time in 2001 examining the Telenor donation – made in late 1995 – and is understood to have made two preliminary findings on it.

The tribunal has accepted that the cheque was not meant as a payment to Michael Lowry and was a political donation to Fine Gael, but argues that because Lowry was, at the time, a trustee of Fine Gael, the cheque to the party is covered by the tribunal's terms of reference.

In his legal opinion, Rogers says that the tribunal has relied on paragraph F of its terms of reference – which provides for the tribunal to inquire into "bank accounts discovered by the tribunal to be for the benefit of Mr Lowry" – to mandate it to make findings on the $50,000 donation.

But he argues that the Oireachtas, in setting up the tribunal, wanted to establish whether Lowry or Haughey made any decision, in the course of their ministerial offices, to confer any benefit on any person making a payment to them.

"The terms of reference gave no clue to it being the intention of the Oireachtas that monies paid to political parties... was to be the subject of inquiry by the tribunal," he said.

The correct interpretation of paragraph F of terms of reference must refer to accounts of monies held for the personal benefit of Lowry, Rogers said. On this basis, he said, preliminary findings made by the tribunal in relation to this matter are not within its terms of reference.

Meanwhile, it has emerged that the tribunal has retained leading law firm Mason, Hayes and Curran for its upcoming High Court challenge from Dermot Desmond. While tribunals would normally hire senior counsel for legal challenges, the retention of an outside firm of solicitors is an unusual development which will further increase the costs of the tribunal.

A spokesman for the government confirmed the tribunal had sought and was granted permission for "appropriate representation" in the event of having to deal with possible litigation. It is understood the Department of Finance signed off on the request.