Derek Achong

Se­nior Re­porter

derek.achong@guardian.co.tt

The Na­tion­al Gas Com­pa­ny (NGC) has se­cured an­oth­er le­gal vic­to­ry in its bid to block a move by con­trac­tor Su­per In­dus­tri­al Ser­vices (SIS) to al­leged­ly dis­pose of its as­sets pend­ing the res­o­lu­tion of ar­bi­tra­tion pro­ceed­ings over the con­tro­ver­sial Beetham Wa­ter Treat­ment Plant.

In a judg­ment de­liv­ered yes­ter­day morn­ing, Ap­pel­late Judges Prakash Moo­sai, Char­maine Pem­ber­ton and Mi­ra Dean-Ar­mor­er dis­missed an ap­peal from SIS and its sub­sidiary Rain­for­est Re­sorts Ltd seek­ing to over­turn a judge, who up­held NGC’s case in 2020.

Jus­tice Dean-Ar­mor­er, who de­liv­ered the pan­el’s judg­ment, said Jus­tice Joan Charles could not be fault­ed for her de­ci­sion in the case.

Stat­ing that the judge’s find­ings were based on her eval­u­a­tion of the ev­i­dence be­fore her, Jus­tice Dean-Ar­mor­er said: “We found her judg­ment to be care­ful­ly analysed and well-rea­soned and we find no rea­son what­so­ev­er to dis­turb her find­ings of fact.”

NGC first sued the com­pa­nies in De­cem­ber 2015 af­ter it be­gan ar­bi­tra­tion pro­ceed­ings against them over the still-in­com­plete wa­ter treat­ment plant.

While the project was es­ti­mat­ed to cost US$162,055,318.77, NGC is seek­ing to re­cov­er a lit­tle over $400 mil­lion, which was ad­vanced to SIS be­fore the con­tract was can­celled in 2016.

It ini­tial­ly ob­tained an in­junc­tion freez­ing $180 mil­lion of the com­pa­nies’ as­sets pend­ing the de­ter­mi­na­tion of the law­suit.

How­ev­er, months be­fore NGC even­tu­al­ly ter­mi­nat­ed the con­tract, SIS took five loans from its sub­sidiary at a to­tal val­ue of $330 mil­lion to al­leged­ly help fi­nance the project.

Sev­er­al months lat­er, SIS ex­e­cut­ed four mort­gages and a deben­ture, un­der which SIS as­signed all of its as­sets to be used as se­cu­ri­ty to cov­er the loans.

NGC al­so al­leged that af­ter it filed the claim, both SIS and Rain For­est Re­sorts ad­mit­ted that no mon­ey was trans­ferred be­tween them, de­spite the mort­gages be­ing reg­is­tered.

While NGC ad­mit­ted that the trans­ac­tions did not ap­pear to be fraud­u­lent on the sur­face, it sug­gest­ed that ev­i­dence gath­ered by it re­vealed that they (the fi­nan­cial in­stru­ments) were in­tend­ed to sul­ly its chances of po­ten­tial­ly re­coup­ing the mon­ey, as the al­leged debt to the sub­sidiary would have to be cleared first.

NGC sought to in­val­i­date the mort­gages and deben­tures through the law­suit.

In de­ter­min­ing the ap­peal, the judges had to con­sid­er whether NGC was per­mit­ted to pur­sue the le­gal re­lief, which is af­ford­ed to cred­i­tors of a com­pa­ny.

Jus­tice Dean-Ar­mor­er ruled that NGC was a cred­i­tor when the in­stru­ments were ex­e­cut­ed, al­though its stand­ing was not based on a court-or­dered judg­ment.

She re­lied on the po­si­tion that there was a like­li­hood that its claim would ma­ture in­to a debt in the “fore­see­able fu­ture” when the ar­bi­tra­tion pro­ceed­ings are de­ter­mined.

Jus­tice Dean-Ar­mor­er al­so agreed that NGC suf­fered prej­u­dice based on the com­pa­nies’ con­duct.

“It is clear that the trans­ac­tion placed SIS prop­er­ty be­yond the reach of NGC. In those cir­cum­stances, any lit­i­ga­tion against SIS would be in vain and any claimant or po­ten­tial claimant would be left with­out a like­ly fund against which to pro­ceed,” she said.

Jus­tice Dean-Ar­mor­er and her col­leagues al­so did not in­val­i­date the judge’s find­ing that the trans­ac­tions were a sham.

“We have found no good ground to de­part from her find­ings, which can­not fall be­yond the pale of de­ci­sions which no rea­son­able judge would have made,” she said.

De­spite its suc­ces­sive le­gal vic­to­ries, NGC was ini­tial­ly blocked from pur­su­ing the case af­ter the com­pa­nies ap­plied for it to be struck out based on the fact that NGC failed to meet the dead­line for ap­ply­ing for a case man­age­ment con­fer­ence af­ter it ob­tained the freez­ing in­junc­tion.

The Court of Ap­peal de­liv­ered a ma­jor­i­ty judg­ment in which it over­turned Jus­tice Charles’ de­ci­sion to al­low the case to pro­ceed.

While the Ap­peal Court’s de­ci­sion was up­held by the Privy Coun­cil, NGC was still al­lowed to pur­sue the claim as it had a pend­ing re­lief from sanc­tions ap­pli­ca­tion, which was put on hold while the is­sue was be­ing ap­pealed.

NGC was rep­re­sent­ed by Deb­o­rah Peake, SC, Ja­son Mootoo, SC, and Sav­it­ri Sookraj-Be­har­ry. Rain­for­est Re­sorts was rep­re­sent­ed by Ramesh Lawrence Ma­haraj, SC, Leon Kalicha­ran, and Nyala Badal. SIS was rep­re­sent­ed by Di­nesh Ram­bal­ly, Kiel Tak­lals­ingh, and Ste­fan Ramkissoon.