Premier faces Ritz writ

| 12/03/2013

GcmRitz_01.jpg(CNS): Updated 5:30pm — The interim administration, and in particular the new premier, is facing legal action in connection with the sale of the Ritz-Carlton, Grand Cayman as the new owners claim it has failed to deal with the transfer but has cashed the US$11 million transfer tax cheque. RC Cayman has filed an application with the Grand Court seeking a Judicial Review over government’s failure to register the transfer of title to the new owners since December, despite repeated requests. The new owners also allege that government is in collusion with the former owner and is attempting to extort the $6 million duty debt run up by Michael Ryan.

Last Thursday, Premier Juliana O’Connor-Connolly confirmed that her ministry was still examining the sale, which took place at auction in October 2012. The former premier, McKeeva Bush, instigated the review of the sale as he accused the buyers, who are also the creditors of the former owner’s debt, of manipulating the sale and undervaluing the hotel. In a statement to the nation he said he intended to ensure that the firm paid more duty and also tied them to the duty waiver debt that had remained unpaid by the former owner Michael Ryan’s various companies.

The new owners have suggested that this is blackmail and government’s failure to act lawfully where the sale is concerned is also a breach of the anti-corruption law. The owners have suggested that Ryan has been involved in the statements that were made by Bush. After the current premier’s failure to respond to the correspondence from the new owners, RC Cayman said it was forced to seek intervention from the courts to prevent the government from acting unlawfully.

RC Cayman Hotel Holdings Ltd and RC Cayman Property Holdings Cayman Ltd, who are the new owners of The Ritz-Carlton, Grand Cayman, took possession of the resort from the former owner and developer, Ryan and his various companies, after he defaulted on the debt owed to its parent company.

The owners assert that government has unlawfully failed to register the transfer of lands relating to their purchase of the property and has unlawfully failed to adjudicate Stamp Duty on the transfers, in accordance with the valuation agreed in October last year by its own chief valuation officer.

“We have repeatedly written to the government and most recently on February 19 and February 25 to the current Premier and Minister of Finance, asking for the transfer to take place. To date we have not received the courtesy of a reply from the government,” said Jim Glasgow, a Director of RC Cayman Property Holdings Ltd.

Unable to secure even an acknowledgement from the Office of the Premier and Minister of Finance, the owners said they were forced to exercise the option of legal action. The application for the judicial review, which was filed Monday afternoon by Conyers, Dill and Pearman, lists the registrar of lands, the chief valuation officer and the premier and minister of finance.

“We are institutional investors in the Cayman Islands who purchased a property following the established rule of law. We have followed the established and agreed processes and simply want the government to do what it is legally bound to do," added Glasgow.

He said the Ritz-Carlton hotel was an important part of the local tourism industry and since the foreclosure auction they have invested over US$71 million "to guaranty stable ownership and have approved planned refurbishment for the hotel in excess of US$12 million for 2013."

Glasgow said that it was extremely difficult to justify investing the capital into the hotel and the local economy without the government registering the transfer of title, particularly when there is so much uncertaintyabout what laws the government will or will not decide to follow. 

“The government cashed our US$11.6 million check for transfer taxes on December 28, 2012 and is violating the law by not recording the deed,” he stated.

See full details of grounds for the JR application on CNS Business.

Related articles on CNS and CNS Business:

Ritz needs investment

Mac blew last chance for 6m

Mac disputes Ritz value

Category: Politics

Comments (75)

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  1. Anonymous says:

    I blame any voter who returned mckeeva to power for these embarrassments. His behavior and favoritism towards Michael Ryan were known well before last election. He took his return to power as condoning his earlier shady behavior and as a mandate to continue doing the same and he did exactly that. Expect more to come too.

    Is he still the best man to attract investors to Cayman?? For anyone who failed to understand that last election despite having good information to go on, pease take this article as confirmation that he is a detriment to investors and our future.

  2. Anonymous says:

    Anybody still wondering where sister Ju's loyalty is?

    • Anonymous says:

      And the Speaker of the House (LA) too!

      The Speaker's tone when addressing the former premier, as opposed to anyone else (except maybe the former premier's loyal followers), seems decidedly and significantly more "friendly". Anyone else notice this?

      Appears to speak volumes of bias!

  3. Anonymous says:

    I hope this matter is properly investigated and if there is any evidence of the evaluation process being corrupted, the responsible party or parties are prosecuted and fired. You all need toremember that it’s not only the politicians that are capable of official corruption.

  4. Anonymous says:

    I don’t know what world you are living in, but from my experience dealing with lands and survey for the past 18 years, they usually will cash whatever cheque you present to them and if the lands evaluation office come back with a different value than the sale value, they will send you a form saying that you have to pay the difference. I even had one instance where they refused to register a clients transfer because she had paid too much Stamp Duty!

    • Anonymous says:

      We've obviously had different experiences then… Lands has always returned the original cheques if they found that the client had to pay more… NEVER LESS.  Most cases were incorrect conversions and the difference minimal.   The original payment was always returned in exchange for the correct one.  We had a client who lived overseas and found the returned cheque in his post office box 2 YEARS LATER.  

      Your client was lucky that Lands corrected her when she paid more… we've never seen a case where they have returned payment if more was paid… EVER.

       

  5. Anonymous says:

    I don’t think anybody in their right mind should suggest that the current Cabinet is doing anything I help Michael Ryan. By all reports they don’t like him and I haven’t heard of them doing anything to help him in the past either. What exactly did he get from them again?

    • Anonymous says:

      Ahh umm … 6 million? (the current cabinet were all complicit in allowing (supporting) the former premier in all that he wanted…no?

  6. Anonymous says:

    So, we should accept that this is a legitimate teansaction, just because they sellers/ buyers are suing Mike Ryan? That makes them above board right? Something stinks to high heaven here and I think that the government owes the people of this country a duty to ensure that the right amounted stamp duty is collected on this deal. They sure as hell put everyone else through the wringer.

    • JTB says:

      Well yes, but there is a legal process for dealing with issues like this and the government has not followed it. They have just stuck their heads in the and, because to resolve the issue would mean acknowledging the unholy mess that McKeeva made of it

    • Anonymous says:

      On the face of it it is a legitimate transaction because (a) the govt. valuation office agreed the valuation, and (b) there was a public auction where the only other bidder refused to bid even the reserve price which was $4m less than thevaluation.

      What needs to be investigated is the relationship between Ryan and the govt.

      Why was Ryan let off from paying the $6m he or his companies owed as soon as the UDP came into govt. in 2009?

      Why does it appear that McKeeva's statement about the deferred duties wholly or partly written on Ryan's computer?

      Why is Juliana not honouring what the valuation office already agreed?   

      It does not serve this country's interests for foreign investors to be put through the 'wringer' after they have complied with the law.  

  7. Empty Vessel says:

    I do hope they have retained the services of Chewy McField.

  8. Anonymous says:

    McKeeva Bush looks like a Rhodes Scholar in comparison Juliana, at least he allows somebody to draft a reply on his behalf.

  9. Anonymous says:

    What is amazing to me is that when all of us purchase any property, you don't hand over the cheque until the papers are all filled in and the transfer is about to happen. We all look bad when our government cashes a cheque and then does not do what it has been paid to do. No one will have any faith in any CI Government if this behaviour continues. 

    • Anonymous says:

      I’m getting used to looking bad by association.

    • Anonymous says:

      Message to all would-be investors in Cayman…..pay your bribes or else…..

       

      It is just another cost of doing business here.

  10. Anonymous says:

    Where is Michael Ryan, aka 6 Million dollar man, anyway? Have they let him go free while owning us all that money?

     

    He was such good friends with Mac, where has he gone to?

     

    Mac, where's your buddy?

  11. Loopy Lou says:

    Omnishambles.

  12. Anonymous says:

    Has Juju forgotten that she is also the Minister for Lands (Lands and Surveys), the dept that deals with these transfers? Or has that been delegated to Mark Scotland too?

     

    What does her Chief Officer, Mr. Alan Jones, have to say about a) the transfer of title delay andb) the lack of a courtesy reply to the developer?

  13. Anonymous says:

    Well it's pretty clear we need more sophisticated adults in charge of this country.  This Mickey Mouse Playhouse stuff has got to end in May.  Our bankrupt public purse has had to shell out millions in avoidable settlements, simply because those at the controls are shooting from the hip, or seeking terrible advice, and learning as they go along.  That pattern is not acceptible at this level of the game.    

  14. Anonymous says:

    The funny thing is that years ago when I bought another house here, I was told at the Tower Building that if Lands and Survey did not agree with the purchase amount for my house, they would send me a bill.  This is just like Immigration is now, you have to pay for everything up front before they will even consider something, and then if the answer is no, you have to apply for your money back, which takes around 6 months.

  15. Anonymous says:

    How do you "undervalue" an asset sold by auction? if it was such a bargain someone would have made a higher bid.

  16. Anonymous says:

    Trust me, our "Premier" will not be dealing with this. She will hee and haw until elections, knowing very well that she won't be back in the head chair. (and do I ever pray that is the case)

    She has always avoided any issue that would force her to take a side and stick by it. So this will linger and wait for the new Premier to deal with.

  17. Anonymous says:

    This is TYPICAL UDP-style governance, and I say UDP because Julianna was born-UDP and still is UDP in a UDP-Lite dress:

     

    They do not follow the current laws on the books (NRA and Roads Law re Brac paving and importation of dandi-mite, Stamp Duty Law re Ritz transfer)

     

    They make a deal, and then try to go back and see how much more they can get from it (FCIA amendments)

     

    They make irrational decisions that bring lawsuits against the Government (GLF Deal, fired NRA Boss, now Ritz sale)

     

    Mr. Glasgow used the right word here: UNCERTAINTY. That's all you will ever get from the UDP and UDP-Lite

     

    • Anonymous says:

      What to expect when at the beginning of this government's reign, the Constitution was ignored!Didn't that show what was to come…!

    • Anonymous says:

      Of course they don't follow the law silly! They don't have a clue what the laws, regulations and proceses are. When they said they would serve the country and all that, they didn't really mean it. They wanted the benefits but certainly not the work AND responsibility that comes with it.

  18. Anonymous says:

    Another fine mess from the UDP past and present!  Let's just review the fine job our fomer Premier did:  Arrested for corruption, $1 million to travel the globe, $4+ million given to churches, etc. of his choosing, $2.5 million lost in GLF and no one can find the feasiblity port studies that are "cayman property", Cohen deal ($700,000), never getting $6million from the Ritz… it goes on and on.  Plus he's uneducated except in the street!  DON"T BE STUPID AND VOTE FOR HIM AGAIN!!

    • Anonymous says:

      And don't forget the latest cheque written to the SAME church in West Bay out of the nation building fund. 

  19. Anonymous says:

    Welcome to corruptman islands

  20. Anonymous says:

    This does not look good for Cayman at all.  First of all if they disputed the amount they should not have taken payment and cashed the check. It is obviously that Cayman is hurting for money and it’s really starting to look like they will resort to anything including what amounts to extortion to get it. This and the way they are now handling the Dart deal by not doing their agreed to part after the built and paid for that huge road will send a message to investors to avoid Cayman..

     

    A lot of people will most likely say this is a good thing because they don’t want outsiders investing hear but there will be a serious trickle-down effect that will hurt each and every Caymanian in the long run..  

  21. Anonymous says:

    Macs secret dealings will yet come back to bite us all.

  22. Anonymous says:

    “The government cashed our US$11.6 million check for transfer taxes on December 28, 2012 and is violating the law by not recording the deed.” Our government seems to be digging itself into a deeper and more embarassing hole in the news lately. Unfortunately, I'm sure there's no way that a story like this won't make international news, and will just be another bad press story for our island. 

  23. Anonymous says:

    I hope she do s better job than her beloved leader keke and collect our $$$$$$!

    Caymanian

  24. Anonymous says:

    Oh no! Say it ain’t so!

  25. Anonymous says:

    Ju-Ju makes Big Mac look competent as Minister of Financial Mismangement

  26. Anonymous says:

    New cabinet but same UDP style of bad management and BS!

  27. Anonymous says:

    Only in a banana republic!!

  28. Anonymous says:

    Come on CI Gov't.  You all are making this place look really bad.  Do the honourable thing and effect the transfer.  Don't get caught up in blunders made by the previous Premier.

  29. Anonymous says:

    If the government was in disbute with the figure they should have not cashed the cheque.

    • Anonymous says:

      I am not sure legally how it works here, but in most jurisdictions cashing a check means the deal is done, and you agreed to the terms.  Perhaps that isn't the case but cashing the check no doubt ads a bit issue to this, and not in the favor of government.

  30. Anonymous says:

    The ‘review, was completed when the cheque was cashed. Govt just doesn’t want to have to admit they have lost the 6M Ryan owed!

  31. Anonymous says:

    How arrogant is that? So, if Government wants to ensure that it is not being ripped off on Stamp Duty, which it is entitled by law to do, it should be sued?? Are these really the kind of investors we want? what are they rea;lly afraid of? That the transfer is delayed until the outcome of their case against Ryan and his aginst them? It only seems logical that that they should wait for that anyways. After all, what would happen if they lose? Would they demand that they get a refund of their Stamp Duty then maybe???

    • Anonymous says:

      It seems to me that these investors have complied with our laws, have not done an 'under the table deal' and now are demanding that the government do the same. The purpose of the government valuation office is to value property and assess duty. If it has already agreed the value it means that as expert valuers they are satisfied CIG is not being ripped off and so there is no good reason for Juliana to be holding the transfers up especially after she has cashed the cheque. 

      Obviously they can't deal with the property until the transfers have been effected.

      The Govt. should not be making decisions to assist Ryan. That seems to have been the problem from day 1. The outcome of the proceedings with Ryan is irrelevant to its obligation to register the transfers.  

       

    • Anonymous says:

      What does the title transfer have to do with any case they have against Ryan, they purchased the property legally and paid the stamp duty on the value agreed to by Caymans government appraiser. I don't see where the problem is other than they are trying to squeeze them for money, just like they are doing to dart now. If this is the new why of doing business for Cayman let the buyer or investor beware, they are clearly ignoring the law, if they have a gripe with a legal deal they should take it to the courts, not just ignore the people who already paid them.. This is what you call corruption ..

    • Anonymous says:

      If they dispute the amount they shouldn't cash the cheque that's the whole point.

    • Anonymous says:

      It only seems logical that they should have waited to cash the cheque if they can't effect the transfer. Duh!

    • Anonymous says:

      The property was valued by the governments own valuers.

      This is just an illegal attempt by the government to hold the new owners liable for the taxes that the previous owner did not pay.

       

      Or maybe an attempt to extort a little consulting bonus.

       

       

    • Anonymous says:

      These people don't have to pay Ryan's debts for him, dumbass. That's why they don't have to wait until Cayman figures out what it's going to do about Ryan (likely nothing anyway.) If I buy your house, I don't have to pay the duty you never paid under some backhand deal years earlier.

  32. Anonymous says:

    What do expect from a "soon come" culture that is incompetant and corrupt.

     

    Just do what everyone else does to get action, sue them

  33. Anonymous says:

    the shambles continues…..when are we going to accept that cayman does not have enough competent administrators to run its own affairs?

    • Anonymous says:

      The issue here is not lack of competent administrators, it is a lack of probity on those who are currently in office.

  34. Step down says:

    Does anyone even know who is ‘behind’ RC Cayman Hotel Holdings Ltd and RC Cayman Property Holdings Cayman??

  35. Anonymous says:

    And once again another attempt from Government to act like they are competent.  Stop trying to look competent and just act like it!

  36. Anonymous says:

    LOL, is anyone surprised about this?

  37. Anonymous says:

    Juju hasn’t dealt with it cos that would mean actually doing some meaningful work – a very alien concept for this Govt.

  38. Anonymous says:

    oHHHHHHHHHHH  oh

    someone not got som eting so no recording

  39. Anonymous says:

    This is great, I'm glad they have the means to take Government's inaction to court.

  40. SKEPTICAL says:

    When will Government learn that ignoring important issues, in the ludicrous hope that they will go away, will only lead to those issues escalating to a far nastier situation. They have to understand that when playing with the Big Boys, trying to move the goalposts in the middle of the game will very rarely result in victory – the Big Boys will invariably have greater reserves of legal and financial resources that they can bring into play.

  41. Anonymous says:

    "we have not received the courtesy of a reply from the government"

    I love that line.

    • Anonymous says:

      The more damning statment is,  “We are institutional investors in the Cayman Islands who purchased a property following the established rule of law. We have followed the established and agreed processes and simply want the government to do what it is legally bound to do." This is a serious indictment of our country and indication of how far we have fallen under the care of this Government.

  42. Anonymous says:

    Head of the airport authority being investigated for fraud, head of the ERA arrested for fraud, Premier arrested for fraud, replacement premier under a cloud after the illegal paving. Now developers need judicial review to force the government to transfer property they've paid for; Dart is going to need court action to force the government to close WB Road as it contractually agreed to do…procurement contracts awarded by the government unilaterally cancelled.

     

    The message to the rest of the world is that the Cayman Islands no longer has a stable government that honors the rule of law.

    • Anonymous says:

      The most ironic and hurtful part to all of this is that the UDP Government has consistently accused and blamdes its own people to be the reason for now development and investments when they themselves do everything possible to mash things up left, right and center!

    • Hon. Absurdistani says:

      Don't forget.

      – Two MLAs (now Ministers) illegally elected.

      – Deputy Premier arrested for drinking and driving. Lied to Police. Mystery woman in his car. Refused to resign.

      .

      Time to clean house my fellow Caymanians… We deserve better representatives.

  43. Anonymous says:

    More and more bad press for potential investors to read. I understand that they have questions about the sale of the property but if that were the case they should not have cashed the check. Cayman is become famous for not living up to their part of deals, just like the west bay road thing, not that Dart has done his agreed to part they are asking for more before they do theirs. It’s starting to sound more and more unstable for anyone to risk putting money into Cayman investments.

    • Anonymous says:

      Not that they should have, but I figure they cashed the cheque because they needed the cash flow, probably to make payroll to all those voters. 

  44. Anonymous says:

    What an embarrasment to our Country and to our People. May elections cannot come soon enough. Note to investors: There was a time when integrity in Govenment was the norm and investment of this magnitude was coveted for theoverall good it does for our economy. Unfortunately, our first two Premiers are cut from a different cloth. Ignorance, arrogance, and incompetence have replaced integrity these sad days.  

  45. Anonymous says:

    Talk about ruining Cayman’s reputation. Our government needs to follow the law if we’re going to look anything but a banana republic.

  46. Anonymous says:

    The govt. doesn't seem to realise the reputational damage it is causing to Cayman by engaging in this fiasco. Foreign investors will now need to take into account the political risk of investing in Cayman and it may not be worth it if the elected govt. can second guess their own professional valuers to help out a friend. All of this talk about attracting foreign investment won't amount to a hill of beans if they keep this up. This will be on Offshore Alert next.     

    • Old Sea Captain says:

      I guess it's time to start packing now. Some of the banana republics in Latin America are starting to look extremely attractive compared to this place. However, I saw this coming after the elections in May 2009 so it's really not a surprise. If past history of the voting public is any barometer, on May 22nd 2013, I guess we can put the final screw in the coffin.