A senior staffer of former NSW Labor MP Ian Macdonald was asked to find out details about water licences for a property Eddie Obeid wanted to buy, the Independent Commission Against Corruption (ICAC) has heard.
Adam Badenoch, Mr Macdonald's chief of staff from March 2007 until January 2009, told ICAC he was instructed to make the inquiry.
But he said he couldn't recall who had asked him.
An email tabled at the inquiry showed Mr Badenoch emailed Brian Gardell, then director of licensing at the water authority, on the evening of September 26 looking for details of water licenses for a farm in the Bylong Valley.
The next day the Obeids signed contracts to buy the $3.65 million property, Cherrydale Park, to which the water licenses related.
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Under questioning from counsel assisting the commission Ian Temby, Mr Badenoch denied he was asked to seek details of the water licence on behalf of the Obeids.
"I have a positive lack of recollection about the fact that Mr Macdonald ever asked me to investigate something and put it in a specific way referencing Eddie Obeid," he said on Tuesday.
"It is highly likely that I would have reacted poorly to that suggestion."
He said it was possible Mr Macdonald had asked him to follow up information about the water licences, but it was also possible it could have been someone else.
Phone records tabled in the ICAC show calls between Mr Macdonald and Mr Obeid on September 25, the day before Mr Badenoch's request to Mr Gardell.
Assistant commissioner Anthony Whealy said there was "an air of unreality" about Mr Badenoch's evidence that the request may have come from a member of the public.
Mr Badenoch agreed with Mr Temby "that the most likely ultimate source of the query" was someone interested in purchasing the property.
The ICAC is investigating whether Mr Obeid used his political power to influence the review and granting of water licences for Cherrydale Park.
The hearing is expected to continue until Friday, when Mr Obeid is due to give evidence.
