A dispute between Anglo Irish Bank and the Quinn family over loans totalling €2.4 billion is likely to end in court rather than being resolved by negotiation, according to Minister of State at the Department of Finance Simon Harris.

The Minister said on Sunday talks between the two parties on the matter had broken down and the case would “likely be settled by the courts”.

The talks were aimed at avoiding a court battle between the Quinn family and the bank which would have seen the bank drop action against members of the family and the Quinns drop their legal suit over loans totalling €2.4 billion.

Mr Harris denied an agreement had been blocked because of the controversy which has emerged in relation to the Siteserv deal.

“I am not privy directly to the talks but my understanding is the special liquidator was ad idim with others with the view that this wouldn’t have been successful with negotiations,” he said.

Mr Harris also defended Minister for Finance Michael Noonan handling of the Siteserv issue.

Former chairman of the Irish Bank Resolution Corporation Alan Dukes has contradicted statements made by Mr Noonan.

Mr Noonan has stated he first became aware of the deal on March 23rd but it had been approved by the bank’s board on March 15th.

Mr Dukes has insisted the department was involved at every step and was involved in monthly transactions.

Mr Harris said Mr Noonan had answered all questions “very comprehensively” and had changed the reporting rules between IBRC and the department.

"The problem was the relationship framework (between the bank [IBRC]and the department) was not intrusive enough," he told RTÉ Radio's This Week.

Independent TD Catherine Murphy said there was a conflict between Mr Noonan and Mr Duke’s recollections of the extent to which the department was informed about the progress of the deal. She said Mr Noonan needed to provide a statement on the issue to the Dáil.

“We need to get to these conflicts and get a full understanding of why one party is saying one thing and the other is saying the direct opposite,” she said.

Mr Noonan has again defended his handling of the Siteserv controversy after new allegations that he misled the Dail.

The Finance Minister has been accused of not telling the truth about the deal which lost the State €109 million.

Mr Noonan said his department gave "full and complete answers" to any questions about the deal and claimed anything Ms Murphy had requested Dáil questions or under Freedom of Information requests was "answered in full".

Speaking on RTÉ The Week in Politics on Sunday Mr Noonan said: “What they didn’t give out was background information and the deputy knew quite well she could get background information by way of a Freedom of Information request and she did that.

“She did a great job from a scrutiny point but I did a reasonable job in co-operating under the parliamentary rules.”

The Minister took issue with the questioning by the programme’s presenter Aine Lawlor who asked whether Mr Noonan only revealed information that he wanted to.

“I don’t believe that you or Sean O’Rourke or anyone in RTÉ has reviewed the replies to the questions and you are simply repeating an allegation made. They are full and complete answers,” Mr Noonan said.

Mr Noonan has been accused by Ms Murphy and Fianna Fail leader Michael Noonan of not being fully transparent about the deal.

Siteserv was sold for €45.5 million to a company owned by Denis O’Brien.

The sale of the company resulted in a loss of €109 million to the taxpayer and is currently the subject of a review established by the Government in the wake of political pressure. Shareholders were paid €5 million as part of the deal.

Ms Murphy began asking questions about the deal in December 4th. She asked 13 questions over the next four months before she received a reply.