GNIC pays further $47M to NICIL

May 31, 2017 News

A cheque for $47 million has been handed over to the attorney representing National Industrial and Commercial Investments Limited (NICIL) on behalf of the Guyana National Industrial Company (GNIC). The sum represents

The Lombard Street property which is the subject of a court dispute between GNIC and NICIL

outstanding rent monies which NICIL claims that GNIC owes for occupying a Lombard Street, Georgetown property which was leased to the shipping company. The case stems from issues which date back to 1995.
According to the facts, GNIC, a company owned by Laparkan and the Guyana National Industrial Company (employees), purchased the assets of the former Guyana National Engineering Corporation (GNEC) and leased Lots 1-12 Lombard Street as part of the privatisation of GNEC.
NICIL reduced the rent due from GNIC by 50 percent in 2000 and the sale price of equipment in 1995 by 30 percent. Despite these concessions, GNIC failed to honour its obligations to pay under the lease. The matter was forwarded to arbitration in July 2009.
The award of $148,860,870 was made by the Court following the arbitration proceedings between NICIL and GNIC for unpaid rent in 2013. But GNIC had failed to comply with the award.
Only recently did the Company pay $108 million to the coffers as part of the settlement. According to court documents, the monies were paid in parts, $60 million and then $48 million. However it was later reported that the two entities were unable to come to a settlement over the outstanding amounts. The matter which is before Commercial Court Judge, Justice Rishi Persaud, was therefore set for trial.
However, when the matter was called yesterday, a cheque of $47 million was presented by Attorney for GNIC, Neil Boston to NICIL’s lawyer, Timothy Jonas, towards the settlement. Mr. Jonas asked for time to verify whether the amount handed over would satisfy the settlement asked for by NICIL.
The cheque, which is the name of the Registrar, is expected to be cleared by Monday. Hence, the matter was adjourned until then.
Previously, GNIC, through its company secretary, Gobin Persaud, outlined a request by NICIL to the court to have the company wound up, (sell all the assets and pay off its creditors).
In the affidavit, Persaud claimed that the only basis of that request is the claim that the company was unable to pay in full its debt. He therefore outlined that in December 2015, the company paid $35 Million and $47 million in November 2006 to NICIL.
Additionally, he said that in November 2016, the GNIC representative said that a Memorandum Of Understanding (MOU) was entered with the Guyana Revenue Authority (GRA) to provide infrastructural facility to accommodate the housing container X-ray machines and ancillary equipment for scanning of containers with respect to the importation and exportation of cargo from Guyana.
The respondent, (GNIC) said that it was entitled to set off the said sum totalling $82M from the amount of $148 million claimed by NICIL.
“The respondent was not given credit for the said sum of $82M, which was before Arbitration.”
The respondent said too that as a result of the MOU with GRA, it was provided with a reliable source of income for approximately $16.6M per month.
The Company also claimed that it receives and will continue to receive under the sublease with Trinidad Cement Limited, (TCL), and the sum of $4.2 million a month.”
At the time of deposing affidavit, the GNIC Representative noted that the company employs 250 workers which include management, technical, clerical and other craftsmen.
In the circumstances, the company asked that the court takes into consideration, the number of employees who will be affected by the order paid for by NICIL.
The company also asked that the court exercise discretion and approve their proposal to satisfy the judgment award and refuse the request of NICIL.