These out-of-court settlements by Govt. must be questioned

Aug 21, 2016 Letters

Dear Editor,
Having publicly castigated the contractor for shoddy works and having appealed the aforementioned Court ruling, one would have expected that the Attorney-General would have prosecuted his appeal and then sue the contractor for damages for breach of contract for the substandard work about which his Govt. complained. Instead, and to the public’s absolute surprise, this Govt. negotiated a “settlement” with the contractor, whereby, rather than the Govt. receiving compensation for the contractor’s breach of contract, the Govt. agrees to pay to the contractor US$5.7M. It is as if the Govt. is rewarding the contractor for the same shoddy and substandard works about which the Govt. itself publicly complained.
When questioned about this bizarre settlement, three Govt. Ministers conveyed the clear impression that the contractor had sued the Govt. for compensation in the sum of US$10m, and that the Govt. managed to persuade the contractor to accept just over 50% of the claim. Indeed, the Attorney-General, on the 8th of August, 2016, in the Committee of Supply, expressed great fear that if the case is not settled, then the Govt. may be forced to pay a huge judgement. He cites the Rudisa judgment in support of his argumentation.
My inquiring mind propelled me to get a copy of this “case”, because I wanted to examine the claim of the contractor. I diligently searched the Supreme Court Registry for the years 2015 and 2016, but could not find any case filed by BK against the Government, claiming compensation in the sum of US$10M as was alleged, or at all. So, again, the nation was misled. This $1.7b of taxpayers’ dollars, which is being paid, is in relation to a non-existing case. To sum it up: this contractor received hundreds of millions of dollars under the PPP with respect to this contract; that it breached the contract, there is no doubt; rather than demand from or sue the contractor for compensation, this Govt. rewards the contractor in the sum of $1.7b and allows him to exit in 2015, a contract that was to end in 2021. In the end, when all the monies paid to this contractor under this contract are totaled, this contractor would have received the full contract price of US$10m for less than 5 years of sub-standard work under a 10 year contract.
The Rudisa case
This case was filed by Rudisa in the Treaty Jurisdiction of the CCJ claiming a refund from Guyana, of monies paid under a section of the Customs Act, which was found to be in violation of the Treaty of Chaguaramus. While these proceedings were pending, the Attorney-at-Law for Rudisa, indicated to the Court, his client’s readiness to withdraw the proceedings if the offensive section of the law is repealed. The Court adjourned the matter for several months to allow Guyana to repeal that provision. Twice, we piloted bills in the APNU/AFC controlled tenth parliament to do so. On each occasion, I detailed to the House the facts of the pending litigation and the consequences that will flow if the section is not repealed. On both occasions, my pleas fell on deaf ears.
On both occasions, the APNU/AFC rejected the amendments. Judgment was eventually granted against Guyana in sum of G$1.2b. Had the APNU/AFC supported the amendments, Guyana would have been saved this money. As an aside, what can be only described as unparalleled sophistry, the Attorney-General still blames the PPP for this debt.
Significantly, during the hearing of this matter, a senior functionary of the distributor of Rudisa’s products in Guyana, admitted under cross examination, that these products were under-valued by Rudisa before shipped to Guyana, in order to compete with Guyanese products. By this admission, Rudisa was guilty of under-invoicing and, therefore, never pay the correct amount in taxes on these products. If an assessment is to be done, using the market value of those products, Rudisa would be indebted to Guyana in the billions. These monies can be set off against the judgment. In the end, Guyana would not have had to pay a cent and Rudisa may still have been indebted to us. This was our plan. Although, it was made known to the Govt. rather than pursue this course and save the country over $1.2b, with bewildering alacrity, they paid the judgement.
Anil Nandlall
Attorney-at-Law

Editor’s note: this is the conclusion of this letter published in our edition yesterday

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