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Puran Bros. sues BK International for $10M over new landfill site

Oct 13, 2011 News

 

Controversy has erupted over the Haags Bosch Landfill Site with one waste disposal company accusing a popular construction firm of cheating it out of its share of the contract to operate the facility.
Lakenauth Puran and Taishnauth Puran, trading under the name Puran Brothers Disposal Services, has moved to the court against BK International for a breach of contract.
The plaintiff is seeking damages in excess of $10M for breach of contract, which constitutes to date; exemplary damages; aggravated damages; interest, costs and other relief that the court deems just.
Attorney-at-law Anil Nandlall represents Puran Brothers.
In a statement of claim, Puran Brothers said that it had entered into an oral contract with BK International in June 2009, to establish a joint venture in order to tender for the construction and operating services of a sanitary landfill operation known as the Haags Bosch Sanitary Landfill, which is located at Eccles on the East Bank of Demerara.
According to the contract, in the event that the tender is successful, BK International shall solely execute the construction phase of the project and Puran Brothers will execute the operational phase, which comprises receiving and disposal of the waste and the overall management of the operations site.
It was further expressed that both Puran Brothers and BK International shall share in the running and management of the site on a 20%-80% ratio respectively, and that all income and expenditure incurred would be shared on this basis for the proposed 10-year life and duration of the landfill site.
Puran Brothers proposes to present documents, which it hopes would establish the oral agreement.
These include a deed of joint venture executed on June 16, 2009 between the two companies and filed in the deeds registry; a bank guarantee issued by Demerara Bank, and the submission of tender dated June 23, 2009 addressed to the Chairman, National Board of Procurement and Tender Administration, which was signed by BK International and presented on a joint venture letterhead displaying the names of both businesses.
The plaintiff also proposes to present the court with a limited Power of Attorney and a letter addressed to Demerara Bank Limited, signed by both entities, requesting the bank to furnish certain information to the Ministry of Local Government and Regional Development.
On June 23, 2009, the two companies had submitted a joint venture tender for the construction and operation of the site at a price of US$10.1M.
The tender was accepted with slight variations and modifications and the contract was duly awarded to BK International and Puran Brothers pursuant to the tender.
In September, last year, BK International commenced the construction phase of the project and is still in the process of doing so. On February 1 this year, the operational phase at the Haags Bosch Landfill Site started.
But according to Puran Brothers, in breach of the express terms of the contract between the two companies, BK International has prevented and continues to prevent the plaintiff from executing or playing any part whatsoever in the operational and management phase of the site.
“…In breach of the…contract, the defendant has assumed sole and exclusive control of the operations and management of the said Haags Bosch Sanitary Landfill and is solely receiving all the monies disbursed under the said contract to the exclusion and financial loss of the plaintiffs,” Puran Brothers said in its statement of claim.
The situation led to attorneys for the company writing to BK International, expressing concern over the breach of contract.
No reply was forthcoming despite repeated requests by the plaintiffs to BK International to discharge its obligations under the contract.
The next hearing is scheduled for November 2, before Justice Rishi Persaud.

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