Archive for July 11th, 2011

GLF plans legal action

| 11/07/2011 | 59 Comments

(CNS): After several weeks of speculation that the company which had been involved in exclusive talks with government to build cruise berthing facilities was going to take legal action, GLF released a statement at the weekend signalling its intention to protect its interests through the courts. The Italian based firm, which partnered with Royal Construction, said statements made by government officials “relating to GLF’s failure to comply with any part of the Framework Agreement …were inaccurate and misleading,” and accused the government of not only breaching its contractual relationship but also damaging its reputation. 

The firm had been in exclusive talks with government over the construction of two piers and an up-land development to support cruise berthing but the talks were ended by the premier, McKeeva Bush, in April when he wrote to CEO Francesco Senis terminating the negotiations because he said GLF had not shown it had the money.

The premier’s letter was in response to a request by Senis in April for a final agreement with government as the firm said it was ready to mobilize within six weeks. However, Bush wrote stating that the Cayman Islands Government did not consider it had proof of the necessary financing to warrant the signing of a master agreement. As a result, he said, government, in agreement with the Port Authority chairman, was terminating the framework agreement which had been signed on December 2010.

It has since emerged, however, that the Port Authority board was not consulted about the decision until after it was made and it appears, given the recent resignation or removal of the port chair, Stefan Baraud, that he had not agreed to the termination.

It became clear after Bush sent the letter to Senis that the government had decided to work with the Chinese firm China Harbour Engineering Company, with which the premier signed a ‘ministerial’ MOU last month that does not yet include the Port Authority. Several new members have now been appointed to the board, however, including John Henry, the new chairman, and Nick Freeland, who confirmed he had accepted the request last week. Local attorney Anthony Akiwumi was also asked to serve on the board but CNS has been unable to confirm whether he has agreed to join the board.

Bush had made it clear earlier in his administration that he would change board memberships wherever the directors did not support his decisions or policies. In this case, the resignations and removals and the lack of support for the premier may have much to do with the liability the board members could face when GLF files suit.

According to the framework agreement, which was signed between GLF, government and the Aort Authority, the exclusive talks were for four months with an additional two month period if neither party had given notice to terminate before the first four months ended. It also required a ten day notice period from any of the parties who wished to pull out of the deal. Bush wrote to Senis on 14 April, four months to the day from the start of the deal on 14 December 2010, to terminate the exclusive talks, as he said he was pursuing other options.

In this weekend’s statement, Senis said that GLF had “fully complied with all requirements of the Framework Agreement, including but not limited to funding of the project, maximum utilization of local resources and the creation of a commercial retail area to be maintained by the Port Authority.”

A local spokesperson said that the legal documents were expected to be filed in the courts this week.

"We can only express our disappointment that this matter has reached this point but have only the utmost respect for GLF which has surprised us with the patience they have exhibited under very difficult circumstances," Howard Finlason, Managing Director of Royal Construction Ltd said.

"Most companies would have gone to litigation much sooner but this was not  GLF’s desire, they wanted only to build the Port they designed for the people of the Cayman Islands. It is only after exhausting every avenue that they have been forced to resort to this. It only goes to reinforce the integrity of this world class firm which spent millions on our behalf only to be thrown to the curb in a most disrespectful and unceremonious manner," he told CNS.

The decision of government to work with CHEC has raised further questions in the community as a result of a number of accusations made about the firm in other jurisdictions.

Leader of the Opposition Alden McLaughlin said the recent revelations that it paid bribes to the former Bangladesh premier’s son Khaleda Zia for assistance with government contracts is of significant concern. Questions have also been asked about the firm and the work it is currently doing in Jamaica.

It is not yet clear how the decision to work with the Chinese firm fits with the government’s own procurement process. In the first instance the cruise port development had gone through central tendering and been awarded to Dart. Thereafter, talks between Dart and government collapsed when the parties could not agree on the length of the lease period to Dart for the upland development area. GLF was the second choice of the technical committee recommended to the Central Tenders Committee. It is understood that CHEC was not on the short list of the preferred bidders reviewed by the CTC.

The premier has defended his decision to begin talks with CHEC as he said the firm not only had the finances to build the cruise port it had also agreed to construct a cruise pier at the Turtle Farm in West Bay and to renovate the jetty at Spotts, the back-up dock used when the weather in George Town is too rough for the tenders to operate. The premier said work at Spotts was due to commence this month and CHEC had advanced $3 million to government for that work, which will be paid back to the company from public money if it fails to reach agreement with the government on the main project.

The statement from Senis in full reads: “Further to recent publications by local news regarding the development of the George Town Port Expansion, GLF wishes to confirm that they have fully complied with all requirements of the Framework Agreement, including but not limited to funding of the project, maximum utilization of local resources and the creation of a commercial retail area to be maintained by the Port Authority.

“As such, statements and interviews recently released by Government Officials relating to GLF’s failure to comply with any part of the Framework Agreement are not only inaccurate and misleading, but constitute a serious breach of the contractual relationship and damaging to GLF’s reputation. The Law firm of Browne Jacobson will assist GLF in defending and protecting their rights and interests as permitted by Law.”

See Framework agreement with GLF here
See CHEC MOU here
See correspondence between GLF and premier here

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Petition exceeds population

| 11/07/2011 | 24 Comments

(CNS): The on-line petition against the proposal to develop a commercial port in East End has surpassed the population of the Cayman Islands. As a result of support from people all over the world, at 7am on Monday morning close to 57,000 people had signed the web based petition, exceeding the country’s population of 54,397 as counted in the 2010 census. The campaign tostop the proposed cargo port project has been gathering momentum since the developer met with the people of East End in June and, despite their opposition, said he still intended to submit his proposal to government.

Since then, a video was made illustrating the disastrous environmental impact and posted on YouTube, the Environmental Advisory Board issued a comprehensive and damning review of the Environmental Impact Assessment and a peaceful local demonstration at the proposed site attracted around 500 people. A local petition has also collected more than a thousand signatures of voters on the electoral register and billboards have been placed in the location.

Government has not yet said whether it has approved the plans submitted by Joe Imparato’s team last month but it did confirm receipt of the proposal and the environmental impact assessment. The premier has made it clear on numerous occasions that he is in support of the proposal, which was singled out in the Throne Speech as one of the development projects McKeeva Bush said he would like to see start during this financial year.

Aside from the very obvious environmental concerns, the local politicians whose constituencies are the most affected by the proposed development have also pointed out that the plans in the first instance are merely for excavation of the site and that the project is nothing more than a mega quarry disguised as a future commercial sea port, the bulk of which would be developed by other as yet unnamed partners. The cargo basin which would be given to government would also have to be completed either with public cash or with another private sector partner.

The “Mega Quarry” or the “Big Hole”, as it has been dubbed by those opposed to the project, seems to have garnered little support despite major publicity campaigns by the developer about potential employment and work for local equipment operators.

The opposition to the development, spearheaded by local MLAs Arden McLean and the independent member for North Side Ezzard Miller, has seen local residents, dive operators, along with other tourism representatives, environmentalist and even quarry operators rub shoulders in the campaign to stop the project. The concerns range from the marine and terrestrial destruction, the negative impacts on the East End community and its way of life, as well as on the tourism product. There are concerns too of the threat to all of the eastern districts during a hurricane. 

Above all, one of the greatest fears is that the East End water lens, the country’s primary source of fresh water, could be threatened by a development which is not considered to be necessary.

However, the decision still lies with Cabinet, and with Bush off island until the 18 July, the campaigners are still not yet sure if they have done enough to persuade the government not to approve the developer’s plans.

See the online petition here

Public protest at East End

Video footage of the reefs that will be lost or damaged by the development

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