GLF may get public cash

| 25/11/2011

cruise ship at port.JPG(CNS): The public purse may be forced to fork out millions of dollars to GLF, the group that had been selected to develop the cruise berthing facilities in George Town, because the premier opted to pull out of the talks and begin negotiations with CHEC. Against the backdrop of speculation that government is already talking with the firm to avert a law suit and settle with the Italian company, a legal opinion given to the Port Authority Board in April had warned that the government was in breach of the framework agreement and risked paying the developer damages. Although there has been no confirmation of a deal, sources tell CNS that the treasury may need to find more than $3 million to stop an even costlier law suit.

A legal opinion by local law firm Priestlys, which was acquired by the local television news station Cayman27 this week, reveals that the lawyers believed the premier was not in a position to legally terminate the exclusive talks. The legal advice indicates that the agreement government had signed with GLF and their local partners Royal Construction prevented it from legally ending the negotiations with the firm on the basis that it didn’t have funding in place.

On 14 April Premier McKeeva Bush, who is also the minister for tourism and the finance minister, had written to GLF telling them that, in agreement with the port chairman, he was terminating the talks as he did not believe the firm had the money in place. Shortly after the announcement it was revealed that government was already talking to China Harbour Engineering Company about the cruise port development. In addition, Bush had already indicated that the Chinese were interested when he spoke at the CBO conference several months earlier, in January.

In their legal opinion to the Port Authority, the lawyers said that the framework agreement between government and GLF required that the developer only have a plan in place for financing, which the firm clearly did, as evidenced by the letter from Citibank.

The advice also notes that the agreement had required the government to give notice to the developer for any breach, which was not given, and that the deal had been an exclusive arrangement. With at least one very public comment about the Chinese developers prior to the termination of the deal, it is clear that government was already talking to China Harbour Engineering Company before it pulled out of the deal with GLF.

Priestlys warn the Port Authority Board that if the firm was to mount a successful action, it would likely be awarded damages to cover the more than $1 million the company had spent directly on the project and significant compensation for the loss of potential profit, which could run to millions of dollars more.

With the situation of the board directors' liability in question, especially if they knew of any potential breach, as well as the risk to the public purse, the directors themselves could also be financially liable. In the wake of the decision by the premier, a number of board members resigned as a result of their objections to the move by Bush.

The lawyers also revealed in their assessment of the move by government to close down talks with GLF and move to CHEC, that the Chinese firm would fund the project outside of the agreement which had been made with the Florida Caribbean Cruise Association on guaranteed passenger numbers. To build the port without pinning down the cruise lines to a commitment on passengers and fees was a substantial risk, the lawyers warned.

The decision by the premier to terminate the deal with GLF without warning and move to negotiations to a third party also created reputational risk for the Cayman Islands, Priestlys said, “which could have a material effect on future procurement” and increase costs for government and ultimately the public purse in the future.

See details of the termination and correspondence between premier and GLF here

Category: Politics

Comments (77)

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  1. Anonymous says:

    Please Mac, for the love of your country, and for the love of all the people in your country who very sincerely love you from the heart of their bottoms, please stop smoking that Chinese weed…

  2. ubelievedat says:

    ANOTHER FR!GGING LAWSUIT??????

    Tom Jones, now GLF!!…………who's next??? 

    For sure there's going to be another one, two, three, four or five lawsuits before we manage to get rid of this Govt.

    HOW is this already broke country going to pay for such expenses caused by reckless judgement.

    I now believe that the "D" in UDP can only stand to mean DEVASTATION, DESTRUCTION, DEMOLISH, DEMORALISE, DISORDER, DEEPER-DEPRESSION, etc.

  3. Anonymous says:

    If the premier refused to take the legal advice with no good reason, he should beheld personally accountable for any money we have to pay GLF.  It makes you wonder why he would do such a thing.  Is he determined to bring down the country he has been sworn in to serve?  Does he not know how many of his people are suffereing due to the foolish increases, or does he simply not care? 

  4. Andy G says:

    I really look forward to each installment of the story of the piers.  Each one is more incredible than the one before it.   This story would make a great book or movie – except no one would believe it. 

  5. Anon says:

    I could put this same post on nearly ever page. So here it is…

    People are really struggling just to put food on their tables! We cannot pay our electric bills! We have NO disposable income! Not even a cent! Our children have been robbed to pay for the folly of fools.

    Yet, again, and again, and again, govt cronies get B.S. Sweethart deals on the backs of our children. Go ahead and be Marie Antoinette. But just remember, whilst there is no cake for those not on the take – there is only so far you can push us before we break. You can avoid judgement in the short term, but not forever. History has a long memory, and your legacy is one of shame.

    Due to the insane duty increases during this recession all of our money is now in the hands of these self serving wasteful people. We need accountability! Unlike the govt big wigs, this isn’t about going from First Class to Business. This is about losing our homes, businesses, and way of life.
    Due to the governments increases in duty, especially fuel duty, all costs have increased, whilst wages have remained constant or fallen. Purchasing power for the average consumer has significantly decreased. the economy had ground to a halt. We have simply transferred the available dollars from the private sector to the public sector. And we all know what a fab job govts do with managing money.

    Just my 4.5 cents, due to inflation.

    • Anonymous says:

      What do you mean you have no disposable income? Of course you do. Mac is disposing it every single day.

  6. An Onymous.... says:

    Is there any chance the Premier may be thing that it would be worth a try to apologize to GLF and offer to reinstate the GT berthing/port agreement with them and that GLF would accept both the apology and the offer?   Although no one knows for sure to what extent the Premier has Cayman tied up in knots with China Harbour Engineering Company, is there any chance that humble and profuse apologies combined with much bowing may get the Premier/Cayman off the hook with the Chinese?  Oh well, until there is transparency, truth, the whole truth and nothing but the truth all that Cayman can do is hope that sooner rather than later this dream of cruiseship berthing will become a reality!    

  7. Anonymous says:

    I had to read this article twice before I could believe it with my own eyes. Commission for Standards in Public Life? If you dont prosecute for this then you confirm what we all suspect, that you are a feeble toothless wasteof time, just like the anti corruption Commission.

    I do not understand why there are zero checks and balances in place in Cayman to stop one person overriding legal advice & pushing the financial nuclear button like this. Surely that's why there is a Cabine? Obviously they all sit there and say nothing against Bush, ever. Which is very very scary. Spineless cowards that they all are.

  8. Anonymous says:

    I think for all their hard work we should all chip in and pay NASA for a one way trip to the moon for a Christmas present for the entire UDP clan.

  9. Anonymous says:

    You know – when Jamaica, Cuba and Com. Republic finish the ports they are building now, it wont matter what we build – their experience is far cheaper and more diverse, and can accommodate millions of passengers without crowded roads and hagglign taxis.

    I say we buy stock in the cruise lines asap – perhaps enough to leverage their agreememt to visit her in the future!

  10. Anonymous says:

    Why are we paying Steve McField $7,000 per month for his sage advice?

     

    By my way of thinking, a smart lawyer should have seen this coming and avoided the situation.

  11. TIRED n BROKE says:

    Sadly we the tax payers will be forced to pay a settlement of $3m due to the incompetence of the Premier, MLA Glidden, Port Authority Chairman, the Board, the legal advisor to the Premier in this matter and the rest of Cabinet. None of them can be absolved from what Cayman is faced with at this stage.

    Do these peopl have no shame? Cayman cannot afford any more incompetence and expensive mistakes driven by ego and XXXX. Since the 2009 elections  the Cayman Islands will have to pay for the Schools law suit (T Jones), The GLF suit and the GT dump fiasco (pending law suit) that should total about US$ 20m after the all the suits are settled. 

    The Tax payer (Caymanians, Residents and Visitors) will be forced to cover the costs n expenses associated with THEIR irresponsbile n expensive mistakes because of XXXX, incompetent, egotisical and XXXX politcians who seem prepared to fight( I mean negotiate) till the death for their own "CGT"  

    WHY do we keeping voting these XXX jokers into office?

    Maybe they arent the problem; "WE" the voting public with the short memories are?

    Let's do Cayman a favor in 2013 – vote these clowns out of office and all their useless bag carriers (back bench mla's) who give them the majority votes to wreck havoc on us.  

    • Anonymous says:

      Why do you keep voting these XXX jokers into office?  Because they are the best you have.  Who else would represent you?

      • Anonymous says:

        Because the majority of us, just like you, are XXX stupid. That's why. Could it really be you are so stupid you never heard of educated and experienced and decent and upright folks like Alden McLaughlin and Ezzard Miller?

  12. Anonymous says:

    Progress?  Good governance?  That's what we are fighting FOR and not getting from this UDP administration.

    Read somewhere?  How about an actual source for your "information"?  I doubt it exists.

  13. nauticalone says:

    I'm so very tired of this man doing such foolishness!

    And with so many very highly paid people in power, a "modernised" constitution and the UK "ensuring" "Good Governance"…yet this uneducated "cowboy" with is "granny wits" continues to cost us all so much money and reputational risk for generations to come.

     

  14. Anonymous says:

    Three million is a drop in the bucket for what will be gained when we get one of the best ports in the world .  I readsomewhere that CHEC was going to give us 3 million dollars.  Stop fighting progress and good governance.

    • Anonymous says:

      Dream on!  The worlds best ports are far bigger than the whole of this little island.  Are you a comedian?

    • Anonymous says:

      UDP, and Bush's PR people trolling the boards, ignore them. 

    • Anonymous says:

      I read somehwere that you're a crackhead.

    • Anonymous says:

      We, the people of the Cayman Islands, really would prefer if CHEC did NOT "give" us $3 million dollars. Especially since it will in all likelihood end up costing us $6 million dollars. That is our present gowerment's modus operandi, not that of the Caymanian people, and we very sincerely hope it is NOT CHEC'S modus operandi although it wouldn't surprise us if it is since our present Gowerment is so hell bent on doing business with them. It is people like you who continue to destroy these islands by accepting "free" fridges in exchange for your votes while refusing to see the damageit is causing our country including your own pockets.      

    • Anonymous says:

      Drop in the bucket?

       

      This is exactly the kind of thinking that has pushed governments around the world into the current global financial mess.

       

      My mother told me that "I don't mind spending money, I just hate wasting it". Cayman Islands ruling class, take heed.

    • Anonymous says:

      There may be 3 million involved but for "us", I seriously doubt it.

  15. anonymous says:

    Stop the CHEC downtown project completely. That will remove any claim GLF has for it as the project is actually STOPPED. Then move on to Red Bay and begin a NEW project. GLF can bid along with CHEC on it. We get a competitive tender scenario.

    You kill two birds with one stone. Firstly the move kills GLFs claim and the GT project is abandoned by Government. Secondly, the Cayman Islands get a less expensive, all weather, expandable HARBOUR capable of generating onshore work for Caymanians. The harbour also protects the properties onshore from hurricane damage.

    We all win.

     

    • Anonymous says:

      07.16. It's time you woke up from your coma. It's 2011, the Vietnam war is over, and so are any plans for Red Bay. Why flog a dead horse, when its cost is double that of a live one, and it's being dragged to the race ten years too late, knowing the cruise passengers won't back it  anyway?

       

      The last thing Cayman needs is more delays. Remember the shoe-maker who produced shoes for caterpillars, then went bust because they promptly changed into butterflies?

    • StraightForward says:

      Somehow I don't think that logic would stand up in court. Would you by any chance be providing legal advice to The Premier?

      Please take some time to visit our current port's cargo/cruise areas and you will see that it is plenty capable of generating onshore work for Caymanians, not to mention the amount of Caymanian employees and business owners(both big and small) that have depended on the George Town port facilities for decades. Natural progression would suggest that the only logical way to improve on that would be to upgrade the current facilities to berthing.

      The cruise lines have also clearly stated that they prefer berthing to tendering, so why would we bulid a port that would still require significant "land tendering" to get the cruise passengers to George Town? 

      Take a basic course in Marine Biology and you will see how vital the Red Bay mangroves are to the marine environment on the South Side of the island. Doing anything that would jeopardise that just does not make sense.

      Lastly, it seems one needs to question if the sea captains aren't being "used" for their honesty and good character by others who have commercial motivations for supporting the Red Bay proposal.  

  16. SKEPTICAL says:

    Is there any possibility that the Chinese are so keen to get a foot in the Cayman door that they undertook to bankroll Government for any damages that might be payable to GLF in consequence of the premier’s unilateral decision to walk away from their agreement. In the context of the projected overall cost of the cruise ship terminal, and potential cost overruns, a couple of million dollars would be petty cash.

    • Anonymous says:

      Eventually, that petty cash would be rolled into the project at a later date.

       

      Cayman will pay the fine, one way or another.

      • Anonymous says:

        Thanks to the one and only Mac we are finally RECEIVING a concession for a foreign company to do business in our country. If we can believe THAT we deserve to have to live with the UDP forever.

    • Anon says:

      Sad. But, I bet you are right on the mark.

  17. Kung Fu Iguana says:

    Surely the nation and the Port Authority can seek an indemnity or surcharge from Mac.  He can sell his apartment at the Ritz to pay off GLF. 

  18. Anonymous says:

    If it does the cost the government $3M to pay off GFL, and the Premier does not resign (or is not kicked out of office by his own party), then there really is no hope for this sad little island.

    • Anonymous says:

      Let me adjust this statement to be a little more specific and accurate:  "If the utter incompetence of the Minister of Finance costs the country- i.e., THE PEOPLE $3M and the Minister does not resign, or is not forced to resign, or is not forced out of office, then there is no hope for this previously wonderful little island.

  19. Sick and Tired of the B...S... says:

    If memory serves me correctly,  earlier this year Bush stated publicly that a principal reason for Government being able to cancel the contract with GLF was that GLF had failed to comply with a clause in the contract requiring them to show they had secured the necessary financing to proceed with the project.  Priestleys letter clearly states : "The Framework Agreement does not require GLF to have secured its funding; the Framework Agreement merely imposes an obligation on GLF to have a plan for funding".  Priestleys letter subsequently goes on to say:  " ..it appears that GLF does indeed have a plan for funding…".  How could Bush/Government possibly misinterpret these statements by Priestleys unless they are totally incapable of reading plain English – there is no legal jargon.  Or, was the subsequent public statement using this particular issue to justify  the cancellation of the GLF contract made, in the belief that Priestleys letter would never become available to the Public, and therefore, the "misinformation/misinterpretation" would never be exposed.

    • Anonymous says:

      A simpler explanation is that the wording of the agreement did not agree with what Mr Bush wanted to do and so he ignored it.  He's said before that he views it as his responsibility to do whatever HE THINKS is the best for the country and TIME AND TIME AGAIN we have been shown just how wrong he is when he thinks that way.

      If they ever erect a statue to McKeeva Bush in the Cayman Islands, it will be for being the most incompetent politician in the history of the Cayman Islands.

       

      • Anonymous says:

        I'm trying to think of another leader in modern history who followed that kind of logic.

        Was it a short guy with a silly moustache and the initials AH?

        • Anonymous says:

          You have to admit the method of execution has improved somewhat since then.

      • Anonymous says:

        "When I use a word," Humpty Dumpty said in rather a scornful tone, "it means just what I choose it to mean — neither more nor less."
        "The question is," said Alice, "whether you can make words mean so many different things."
        "The question is," said Humpty Dumpty, "which is to be master – – that's all."
        (Through the Looking Glass, Chapter 6)

        The question is: how long would the statue stay on its pedestal?

    • Micky Mouse says:

      Maybe the reason Bush didn't take Priestley's advise was two fold: not seeing the letter and/or he had his employed legal advisor advising on the issue. Either way, good research work CNS.now get us some news on what the gov is thinking?

      But hold on here, isn't there 5 ministers that make up Cabinet? So why isn't those other 4 duds screaming and holloring into the Bush. Are they so consumed by their colleague that they have conveniently ignored the right and ethical things to do?

      Talk all you want about West Bay voters but please remember there are 5 others from various districts that are supporting Bush's actions. So, to me, if I were you "other districts" rise up and beat up on your elected members and STOP putting the blame on the 4 WB elected members. My maths tells me that 5 can beat 4. So Elio, John John, Mark, Julie and Mr. Adams seeing that your colleague is distroying your reputation rised up and demand his resignation and throw him out of Cabinet. 

    • yoda says:

      He is being advised by non other than the "Great Steve McField". So wah ya expec?

       

    • Anonymous says:

      And who was the Port Authoritys Legal Advisor at the time. Yes! it was Priestley who's advice The Premier refused to take and then fired him together with the Chairmana and Vice Cahiarman of the Port Authority Board who were all telling him that GLF was fine.    

  20. Knot S Smart says:

    Sorry to spoil your Christmas folks – but we need to add another 5 cents to the import duty on fuel. We will classify this one as dock expenses.

    • Anonymous says:

      It'll probably be more like 10 cents by the time we finish decorating a certain house in West Bay for Christmas.

  21. Anonymous says:

    One can only wonder, with great anxiety, about what else may be hiding in the Bush.

  22. Anonymous says:

     

     

    The Premier should have to fork out all costs legal and otherwise for this travesty. I'm sure he has enough stashed away to cover this in his private accounts and holdings both here and overseas. 

    It seems all too easy for him to play with the private purse and not be accountable for his actions when things turn sour. He might actually think twice, about the risks given that he actually had the competence and the experience in these matters, and if he was playing with his own private purse.

  23. Anonymous says:

    Am interested why any comment i ever post here never makes it through for viewing seems censored ??? My comment:

    XXXX

    CNS: Because I'm not posting a cut and paste from a thesaurus with numerous links.

  24. Anonymous says:

    Outrageous. When will he step-down?

  25. Dred says:

    So let the record show:

    Cohen and Cohen $450,000 – Wasted!!!

    GLF $3,000,000 – Wasted!!!

    Any other surprises you holding back for us Mr. Bush???

    • Anonymous says:

      Apparently its only waste if you spend it on a school.

    • Anonymous says:

      Add to your list.

      $600,000.00 finders fee/commission for arranging the turtle farm financing.

      $4,500,000.000. More than McAlpine and Arch and Godfrey's bid Paid to Meisner Marine for the construction of the current port.

      Etc.

      Cayman's finances have become a personal petty-cash pan it seems.

    • Anonymous says:

      Sorry but I can't tell you about the other surprises until Christmas.

  26. Truth says:

    Business Cayman style.  No experiance, no training, no education, no class and no ability to listen to anyone else.  Full speed ahead.

  27. Anonymous says:

    Unbelievable.

    Let's hope there is a full, public hearing so we can understand why the premier of the country would personally violate agreements made by the government on behalf of this country, incur millions of dollars in liabilities and jeopardize cruise tourism. 

  28. Anonymous says:

    Any compensation to GLF should be made personally by the Premier and not be taken from the public purse.  If he did indeed choose to ignore the letter and spirit of the agreement, for whatever reason and in the midst of much controversy, then he should be held personally responsible for any judgement and/or penalty.

     

  29. Anonymous says:

    So we have to foot the bill for him switching on the loan, and we have to foot the bill for him switching on the port.  And we have to foot the bill for every other cock-up he makes.

    I really do think he should pay for his own mistakes rather than we the public.  Perhaps if politicians had to pay for their own mistakes, they would start making less mistakes!

  30. Anonymous says:

    how much of an advance was given by the Chinese again?????

  31. Anonymous says:

    Why don't the ministers who were on Rooster, many months ago, justifying the change to CHEC, including Caymanian participation speak up? Remember what you said Ministers, "its worth delaying the project a few months to gain Caymanian participation." Few months? Where have the Chinese gotten with the Port?

    Cayman has leaped forward with FOI. It now needs investigative journalism. If the marlroad is correct, delays are typically due to "who should get what". 

  32. Anonymous says:

    Lord have mercy! If we do not hurry and remove this man from office he will finish bankrupting this country.  

  33. Anonymous says:

    Sadly, Cayman has its own reality series…….Madmac……the Biggest Loser. 

  34. Anonymous says:

    GET RID OF MCKEEVA BUSH CAYMAN!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

    • Dred says:

      PPM Governemnt can I make a suggestion. In the inherent best interest of the peopleof the Cayman Islands I propose that:

      1) We dig a trench from the upper 7 mile beach right past the cemetary to the North Sound therefore seprating West Bay from the rest of Grand Cayman.

      2) We offer them independence

      3) We put a 30 foot high barbed wire fence between us.

      4) People from West Baby now required to get Visa to visit Grand Cayman. No Visa issed to UDP members.

      Now Big Mac can mess his own district and supporters up at ONLY their expense. Ooh Yeah they can have the Turtle Farm. Maybe he can build his Oil Refinery next to it.

      This way we can impliment one man one vote. We should also at teh same time set up a new national holiday. National Vindication Day.

      Outside of this we probably are stuck with him.

  35. Anonymous says:

    If we do pay any money it should come out of Mac's very big pockets or he should go to jail for financially exposing our country this way.

  36. X Pat says:

    As soon as the news broke of Bush's unilateral termination of talks with GLF, posters on this site immediately warned of law suits and there was much speculation  and suspicion of dubious secret deals with the Chinese.

    We can put aside the suspicious nature of Bush's actions for now as neither he nor the Chinese are going to be offering any details on that score nor do I think there is any real prospect for proving anything.

    However Mr Bush is on the face of it now up against a serious personal charge of negligence or incompetence in that he apparently sought no (or no material) legal advice before following his extraordinary course of action. As a result he incurred a significant potential $ liability on behalf of the Cayman Islands.

    Being grossly incompetent or negligent with public funds in public office doesn't seem to have any criminal repercusions, but I do wonder whether such behaviour can be sued in the civil courts – in other words whether Bush can be named as a co-defendant with the CI Govt in this matter and whether his neck can be put on the line too, rather than hiding behind his position as a Govt. officer?    

    • Dred says:

      This all sounds nice. Unfortunately this is UDP and MB we are talking about. So I would not be holding my breath unless BLUE is your favorite color. Then purple. Then gray. What color is ashes again?

    • Anonymous says:

      In the UK elected public representatives (check out Westminster Council in 1996) can be held personally financially accountable when they screw up. I guess the same rules apply in some form to the Cayman Islands and stupidity, which seems to be the root cause of this, is no excuse.

      Guess all those who hoped for a new freezer, plasma screen TV or whatever in April 2013 will be disappointed.

       

  37. Anonymous says:

    I dont know why you all publish this article that strongly suggests the Premier is at fault.

    He has already publicly declared he is a finance minister that knows nothing about finance

    He admitted he wasted 350K on loan arrangement, but he did what he thought was best for the country, so really what is the big deal about another $3M?

    Its not his fault and this is pure unadulterated bureacratic nonsense!

  38. Anonymous says:

    I'm glad to see that Priestlys have seen fit to back up the comments posted many times on CNS that building the cruise berth without nailing down a guarantee from the FCCA and the individual cruise operators on how much revenue would be generated is just plain dumb.

    It's like building a motel in the middle of nowhere and sitting back hoping the visitors will miraculously turn up simply because it's there – and don't laugh because I've seen it done.

  39. Hann Dowt says:

    I have some spare coins in my car if the CIG need assistance.

    • Anonymous says:

      Better keep dem coins to help pay your CUC bill, Bro. Don't worry 'bout us, we mekkin arrangements wid Cohen ta hep us out.