Derek Achong

British Queen's Coun­sel Pe­ter Knox says the Gov­ern­ment con­tra­vened the In­sur­ance Act by fail­ing to put Cli­co's as­sets in­to its statu­to­ry fund, which was in deficit, af­ter the in­sur­ance com­pa­ny's col­lapse in 2009. Knox made the state­ment while mak­ing sub­mis­sions in a ju­di­cial-re­view law­suit filed by the Unit­ed Pol­i­cy­hold­ers Group. The law­suit is be­ing heard be­fore Jus­tice Joan Charles in the Port-of-Spain High?Court.

In his sub­mis­sions, Knox said that from fig­ures pro­vid­ed by the Gov­ern­ment and from sta­tis­tics pro­vid­ed by on­go­ing com­mis­sion of en­quiry in­to the com­pa­ny's col­lapse, his clients be­lieve Cli­co's as­sets were suf­fi­cient to rec­ti­fy the statu­to­ry fund and re­pay pol­i­cy­hold­ers.

Knox's sub­mis­sion in­clud­ed an es­ti­mate that the as­sets avail­able to the in­sur­ance com­pa­ny's statu­to­ry fund amount­ed to $24.646 bil­lion as at Sep­tem­ber 14, 2011, which was the day that the Gov­ern­ment pub­li­cised its ini­tial plan to re­solve the Cli­co col­lapse. The sub­mis­sion al­so places a val­ue of $8 bil­lion on Cli­co's 56.4 per cent stake in Methanol Hold­ings (Trinidad) Ltd

In their law­suit, the pol­i­cy­hold­ers are chal­leng­ing the de­ci­sion of the Cab­i­net to refuse to ho­n­our the promise Gov­ern­ment made in 2009 that EF­PA pol­i­cy­hold­ers would be ful­ly com­pen­sat­ed for their poli­cies. They claim the de­ci­sion was dis­pro­por­tion­ate, il­le­gal and ir­ra­tional.

The le­gal ac­tion was brought against the Gov­ern­ment last year and list­ed Prime Min­is­ter Kam­la Per­sad-Bisses­sar as a par­ty ow­ing to her role as head of Cab­i­net. Knox quot­ed a de­ci­sion from the Privy Coun­cil in which the Law Lords said for a gov­ern­ment to re­nege on a pre­vi­ous guar­an­tee, it had to show there was an over­rid­ing pub­lic pol­i­cy con­sid­er­a­tion.

Knox said that there was no ev­i­dence of any pub­lic pol­i­cy for not ho­n­our­ing the orig­i­nal bailout plan, which was an­nounced by for­mer Fi­nance Min­is­ter Karen Tesheira af­ter a mem­o­ran­dum of un­der­stand­ing was signed be­tween the Gov­ern­ment and the in­sur­ance com­pa­ny in 2009.

As part of the ev­i­dence, he high­light­ed speech­es by Per­sad-Bisses­sar and for­mer Fi­nance Min­is­ter Win­ston Dook­er­an, which he said showed the Gov­ern­ment's di­ver­gence from the ini­tial guar­an­tee that was made to pol­i­cy­hold­ers. Af­ter as­sum­ing of­fice in 2010, Knox said Per­sad-Bisses­sar was quot­ed as de­scrib­ing the guar­an­tee, which was de­vel­oped by the pre­vi­ous regime, as a hol­low and emp­ty promise.

He al­so ref­ered to mul­ti­ple let­ters sent among the Gov­ern­ment, the Cen­tral Bank and Cli­co to de­vel­op a time­line for the cre­ation and evo­lu­tion of the bailout plan. Knox ex­plained the tran­si­tion from the orig­i­nal plan to the most re­cent one, an­nounced by cur­rent Fi­nance Min­is­ter Lar­ry Howai in the 2013 bud­get.

The pol­i­cy­hold­ers' le­gal team in­cludes Ramesh Lawrence Ma­haraj, SC, to­geth­er with Vi­jaya Ma­haraj, Nyala Badal and con­sult­ing at­tor­ney, Robert Strang. Queen's Coun­sel Alan New­man and Rus­sell Mar­tineau, SC, are rep­re­sent­ing the State.

Knox will con­tin­ue his sub­mis­sions lat­er to­day, af­ter which New­man is ex­pect­ed to re­spond.