Derek Achong

The Es­tate Man­age­ment and Busi­ness De­vel­op­ment Com­pa­ny (EM­BD) has been or­dered to pay over $427 mil­lion in un­paid fees to a mega-con­trac­tor from La Brea, for in­fra­struc­ture works it per­formed on four res­i­den­tial com­mu­ni­ties for for­mer Ca­roni (1975) Lim­it­ed. 

Al­though Na­mal­co Con­struc­tion Ser­vices was seek­ing over $1.3 bil­lion through its law­suit against the State-owned spe­cial pur­pose com­pa­ny, High Court Judge Ricky Rahim or­dered less than half the claimed amount, as he par­tial­ly up­held EM­BD’s de­fence and counter-claim over an al­leged “con­spir­a­cy” be­tween the con­trac­tor and a for­mer se­nior EM­BD of­fi­cial.  

In the law­suit, filed in 2016, Na­mal­co was seek­ing com­pen­sa­tion for its un­paid con­tracts for in­fra­struc­ture works at projects at Cedar Hill, Roops­ingh Road, Pe­tit Morne and Pic­ton Mon­key Town. 

In de­fence of the claim, EM­BD con­tend­ed the com­pa­ny’s in­voic­es were in­flat­ed and the work did not meet re­quire­ments set by EM­BD. EM­BD al­so al­leged sev­er­al sup­ple­men­tal con­tracts for the projects award­ed by its for­mer CEO See­bal­ack Singh should be void­ed, as he (Singh) did not have the re­mit to ap­prove such with­out a ten­der process. 

Na­mal­co was ini­tial­ly seek­ing pay­ment for six con­tracts but two were split from the case, as they fell un­der a sep­a­rate $200 mil­lion law­suit brought by the Gov­ern­ment against it and four oth­er con­trac­tors. 

In that claim, EM­BD is al­leg­ing the con­trac­tors con­spired with the com­pa­ny’s for­mer of­fi­cials to ob­tain con­tracts in Sep­tem­ber 2015. 

Oropouche East MP Dr Roodal Mooni­lal, for­mer EM­BD CEO Gary Par­mas­sar and for­mer di­vi­sion­al man­agers Mad­hoo Bal­roop and An­drew Walk­er are list­ed as par­ties in that claim, which is yet to go on tri­al be­fore Jus­tice Frank Seep­er­sad, who in­her­it­ed the case af­ter Jus­tice James Aboud was el­e­vat­ed to the Court of Ap­peal. 

In the 245-page judge­ment, Jus­tice Rahim ruled the court had the pow­er to con­sid­er chal­lenges to the va­lid­i­ty of In­ter­im Pay­ment Cer­tifi­cates (IPCs) sent by Na­mal­co for pay­ments to be made based on abate­ment or diminu­tion in val­ue. How­ev­er, he ruled the IPCs un­der the orig­i­nal agree­ments could not be fault­ed by EM­BD be­cause Na­mal­co did not pro­vide suf­fi­cient doc­u­men­ta­tion to but­tress its claims. 

Jus­tice Rahim al­so ruled that de­ci­sions on the ini­tial agree­ments made by the Dis­pute Ad­ju­di­ca­tion Board (DAB), ap­point­ed by both par­ties, were bind­ing, con­clu­sive and in­ca­pable of be­ing the foun­da­tion of EM­BD’s le­gal chal­lenge. 

De­spite find­ing that EM­BD was li­able for its re­main­ing bal­ances on the ini­tial con­tracts, Jus­tice Rahim in­val­i­dat­ed the sup­ple­men­tal agree­ments which raised the Roops­ingh Road and Pe­tit Morne projects by ap­prox­i­mate­ly $185 mil­lion and $129 mil­lion re­spec­tive­ly. 

While Jus­tice Rahim ruled that Singh breached his fidu­cia­ry du­ty by ap­prov­ing the sub­stan­tial con­tracts when he on­ly had the clear­ance to ap­prove con­tracts un­der $1 mil­lion, he not­ed the is­sue was cured by the fact that EM­BD’s board sub­se­quent­ly ap­proved them. 

How­ev­er, Jus­tice Rahim said the agree­ments had to be void­ed, as the ev­i­dence in the case showed Singh and Na­mal­co were en­gaged in an “un­law­ful means con­spir­a­cy” to in­flate the con­tracts. 

“No oth­er in­ten­tion is ap­par­ent on the ev­i­dence and this re­mains the sole rea­son­able in­fer­ence of in­ten­tion to be drawn hav­ing re­gard to the fact that the sums claimed have since been shown to be much more than that which ob­tained un­der the orig­i­nal award and which would have been rea­son­ably claimable for new work even at new prices as set out,” Jus­tice Rahim said. 

“This is­sue has been scru­ti­nised by this court and has caused much dis­qui­et as there ap­pears on the ev­i­dence to be a lurk­ing sus­pi­cion of agree­ment,” Rahim added, as he not­ed nei­ther Singh nor Na­mal­co’s CEO Naeem Ali tes­ti­fied be­fore him. 

As part of the law­suit, EM­BD brought an an­cil­lary claim against its project en­gi­neers who cer­ti­fied the projects - Walk­er, At­lantic Project Con­sul­tants Lim­it­ed, BBFL Civ­il Lim­it­ed and Lee Young and Part­ners. It claimed the group should be made to pay a por­tion of the com­pen­sa­tion if it was even­tu­al­ly found li­able, as they were al­leged­ly re­spon­si­ble for the IPCs that were up­held through neg­li­gence. 

While Jus­tice Rahim ruled there were some breach­es of du­ty on the part of the four en­gi­neers, he ruled they could not be or­dered to in­dem­ni­fy EM­BD, as it (EM­BD) suf­fered no loss. 

The claim against Walk­er was stayed pend­ing the on­go­ing le­gal pro­ceed­ings be­fore Jus­tice Seep­er­sad, while the case against BBFL was al­so stayed for EM­BD to pro­vide ad­di­tion­al sub­mis­sions based on Jus­tice Rahim’s find­ings on the al­leged con­spir­a­cy.

The cas­es against At­lantic and Lee Young were dis­missed with EM­BD be­ing or­dered to pay the for­mer $1.6 mil­lion in out­stand­ing fees for one project and their fees for the three oth­er projects be­ing as­sessed by a High Court Mas­ter at a lat­er date.