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$100M MRL case … Contempt action filed against Demerara Bank

Oct 26, 2010 News

A court case in the continuing saga of Mahaicony Rice Limited (MRL) has taken a twist with one Essequibo rice farmer taking filing contempt charges against Demerara Bank Limited for not honouring a bank guarantee.
The contempt action, which comes up on November 8, was filed against Directors, Pravin Dave, Hemraj Kissoon and Dr. Leslie Chin, by lawyers for Essequibo rice farmer and businessman, Arnold Sankar.
Sankar, through his lawyer, Anil Nandlall, Manoj Narayan and Euclin Gomes, sued MRL back in August demanding more than $100M being unpaid monies for paddy.
On September 27, Justice Rishi Persaud granted judgment granted to Sankar for $85M along with costs of $200,000 and interests.
Demerara Bank had issued a Bank Guarantee, lodging it with the Registrar of the Supreme Court.
The Judge had also ordered a stay of execution which expired on October 18, last.
According to court documents, Rasheed Mohamed, a Judicial Officer of the High Court, had sent a letter to Demerara Bank Limited along with a copy of the court order calling on Demerara Bank to comply but to date, “Demerara Bank Limited has willfully neglected, refused and omitted to comply with the said Order of Court…”
Last Wednesday, Sankar’s lawyers wrote the Dave, the Chief Executive Officer of Demerara Bank Limited, warning of a contempt motion for the non-payment.
Attorney-at-law Nandlall, on Wednesday, also wrote the bank informing the Chief Executive Officer of the contempt of the court order.
“I feel obliged to explain that in anticipation of receiving payment under this Court Order since Monday the 18th October, 2010, my client has made commitments elsewhere which, as a result of your bank’s non-compliance, he cannot now discharge and this conundrum has placed him in an even greater financial crisis.”
He gave the bank a deadline of 10:00hrs last Thursday by to pay or else face the institution of contempt of court proceedings.
On Friday, the bank was served with the order of the court which explained the consequence of its not heeding it.

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