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Those Mobilization and Performance bonds lodged by ‘Fip’ Motilall

Jun 29, 2013 Letters

 

Dear Editor,
I must again put pen to paper to correct inaccurate reporting by Kaieteur News about the Mobilization and Performance bonds that were lodged by ‘Fip’ Motilall, which was a condition of contract for construction of the Amaila Falls Road.
The mobilization bond was for eight months while the performance bond was for sixteen. Both bonds had a start date of March 18th 2010 hence the mobilization bond ran through 17th Nov 2010, while the performance bond was good up to 17th July 2011.
As correctly reported, there was provision in the performance bond that permitted the Government of Guyana (GOG) to make claims for an additional six months, however not reported was that these claims could only be made under certain conditions. If these conditions were met then it would be Hand in Hand’s responsibility to pay claims up to US$1.5M through 17th Jan 2012, and not through last Wednesday as reported in Sunday’s Kaieteur newspaper.
Now this is the sticking point. On Dec 19th, GOG made a claim, and while this claim was made within the stipulated six-month period, Hand in Hand has to date made no payment, because they are not sure that the certain conditions have been met. Hand in Hand takes the position that a claim against a performance bond needs to be for an infraction during the validity of the bond, and it seems they feel this is not the case. I would imagine this matter will have to be sorted out in court.
My gripe in all this is why a claim was not made prior to 17th July 2011? Possibly, either the person responsible for keeping an eye on the upset date of 17th July dropped the ball by missing this date, or that individual did inform GOG the upset date was upon us and GOG knowingly did not make the claim for reasons not yet made public.
For the benefit of the public, the process would normally go something like this:
SRK’N gineering headed by Dr Narine is the supervision consultant for the project and usually it would be the supervision engineer’s responsibility to keep an eye on the upset date. If they were responsible, and if they have a letter in their file informing the Government Engineer that the 17th July was fast approaching, then they will be covered. If the Government Engineer who is appointed by the Minister of Works and Transport to safeguard GOG’s interest, in this case Walter Willis, was responsible, and if he  has a letter in his file to the PS Ministry of Works and Transport, then he would also be off the hook.
If neither of them have letters to this effect, then one or both of them could be responsible for dropping the ball. This is the usual procedure; however in this case it could have been someone else’s responsibility.
The fact is, the opportunity was lost to certainly recover US$ 1.5 million by making a claim prior to 17th July 2011 and there is now a possibility that Hand in Hand may not have to shell out the US$1.5 million.
In view of the above I think it would be appropriate for the GOG to sue and debar consultants as well as dismiss Government officers who through negligence cause serious loss to the People of Guyana.
Edward Gonsalves 

 

 

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