Former Sports Company of T&T Limited (SporTT) chairman Sebastien Paddington has sought to defend his and his former colleagues’ role in a failed $34 million contract for the controversial Life Sport programme.
Paddington did so yesterday as he testified before Justice Ricky Rahim in SporTT’s ongoing trial against him and other former board members for breach of fiduciary duty over the deal at Waterfront Judicial Centre in Port-of-Spain, Friday morning.
While being cross-examined by the State company’s lawyer Colin Kangaloo, SC, Paddington maintained that he and his colleagues were acting on the directives of the Ministry of Sport when they entered into the deal with eBeam Interact Limited to administer the numeracy and literacy, and the interactive technology components of the occupational skills training aspect of the programme.
Paddington stated that the company’s role was to operationalise policies and projects being pursued by the ministry.
He said: “They (ministry officials) could not control but could influence, direct, instruct, and recommend because we (SporTT) were implementing arm of ministry policies.”
Asked whether the board of directors could exercise independent thought and judgment in relation to the ministry’s directives, Paddington said: “I don’t accept that I was required but I could and did.”
Paddington was quizzed as to whether the then-Finance Minister approved the contract as the sole shareholder of the company.
“It must have been otherwise why would they authorise and finance the contract,” he said.
Kangaloo pointed to errors in correspondence sent by the Sports Ministry to the board before the contract was signed in late 2012, which advised that eBeam should be contracted based on a sole select tender.
Paddington suggested that the ministry had scrutinised the proposal before giving the directive.
“We were advised by our CEO that the appropriate due diligence was done,” he said.
“We had no reason to doubt that these things were not met from previous meetings and emails,” he added.
Paddington admitted he took no issue with portions of the document which appeared to propose services for at-risk children although the Life Sport programme was intended for men ages 16 to 25.
“Anyone who is accustomed to coaching youths understands that you must get them from when they are young, not when they are 18,” Paddington said.
While he claimed that the ministry had full oversight over the project and associated contract, he noted that he and the board members did raise issues with the contract after eBeam demanded payment with its obligations not being complete.
“I was under the assumption that work was progressing. We knew that it was not complete. We objected to the final payment,” he said.
During his testimony, Paddington, a former national swimmer, claimed that he was reluctant to take up the position on the board when first offered.
“I hemmed and hawed but eventually accepted as I wanted to give back to the country from an administrative standpoint, as a former Olympian,” Paddington said.
Also testifying yesterday were ex-directors Cheemattee Martin and Reynold Bala.
Like Paddington, Bala maintained that the programme was under the control of the Ministry of Sport. He also claimed that the ministry was responsible for ensuring that eBeam had met its obligations before the contract was eventually terminated.
“I could not evaluate that. The Ministry of Sport was responsible for that programme under the approval of Cabinet,” he said.
“You can’t question the government’s policy,” he added.
Bala also confirmed that current SporTT chief executive Jason Williams served as the head of the company’s accounting department during his and his fellow board members’ tenure.
He suggested that Williams would have been aware of the contract and helped to facilitate payments.
“I would assume so,” he said.
In the lawsuit, the company is claiming that its former board acted negligently and recklessly in entering the contract.
The defendants in the case are former chief executive John Mollenthiel, and ex-directors Paddington, Chela Lamsee-Ebanks, Bala, Norris Blanc, Nisa Dass, Anyl Gopeesingh, Sabrenah Khayyam, Martin, Matthew Quamina, Annan Ramnanansingh, Kent Samlal, Harnarine Seeram Singh, and Milton Siboo.
On August 22, High Court Judge Eleanor Donaldson-Honeywell rejected SporTT’s breach of contract case against eBeam but ordered it to pay $30 million in restitution as she ruled that it was unjustly enriched for services it did not provide.
While SporTT was seeking the entire value of the contract, Justice Donaldson-Honeywell deducted $4 million, which represented the nominal services inclusive of the procurement of equipment provided by eBeam.
“It would be legally unjust for the Defendant to retain the benefit of $34 million when only minimum value, unrelated to any substantial delivery of the bargained for services, was received by the Claimant under the contract,” Justice Donaldson-Honeywell said.
“The minimal services provided by the Defendant did not meaningfully meet the benefit which was intended by the parties to be delivered to the Claimant,” she added.
eBeam still has the option to appeal the outcome.
SporTT has contended that the case against eBeam has no bearing on the parallel litigation against the group.
The defendants are expected to begin to take the witness stand and be cross-examined when the case continues next week.
John Lee and Stephanie Moe are also representing SporTT.
The group’s lawyers include Fyard Hosein, SC, Anthony Vieira, SC, Rishi Dass, SC, Jagdeo Singh, Karina Singh, Keston Lewis, Roger Kawalsingh, Ravi Mungalsingh, Tara Bhariosingh, Nicole de Verteuil-Milne, Adrian Ramoutar, Sushma Gopeesingh, Kamini Persaud-Maraj, Neal Bisnath, Lydia Mendonca, Richard Jagai, Andrea Bhagwandeen, and Dharmendra Punwassee.