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Moves to disband CDA board

Fight over legal service contracts takes new turn...
Sunday, September 9, 2012

One month after several board members of the Chaguaramas Development Authority (CDA) challenged the $30,000 monthly payments being forked out to contract corporate legal services, moves are afoot to disband the state board. The Sunday Guardian learned Planning Minister Bhoe Tewarie issued the directive last month, instructing all board and committee meetings to cease with immediate effect.


And, in an unprecedented move, the line minister has also moved to overturn the decision taken by the board, insisting the agreement to contract corporate legal services should not be terminated but extended. The directive comes almost three weeks after seven of the nine board members voted against the $30,000 payment, questioning why the position of corporate secretary was not being advertised.


It was at an August 3 meeting with the minister that the board members objected to an extension being granted to contract corporate/legal services. However, in a shocking development, board members were told of the minister’s directive via e-mail two weeks ago by acting corporate secretary Leisa Kisto. The e-mail stated: “The minister has informed that there shall be no more committee and board meetings.” Law firm Kaisel Services Ltd has been contracted to provide corporate/legal services to the CDA since July.


The law firm was also hired in May by the National Flour Mills, whose board is mired in controversy after six board members moved a vote of no confidence in chairman Jacqueline Burgess, replacing her with director Suresh Maharaj—the brother of Devesh Maharaj. That decision, however, was later reversed.



Corporate fees move from $15,000 to $30,000
However, reliable sources said the board took issue with the agreement after it was found that the sum being paid to the law firm was almost double the amount previously paid to other law firms. It is the second time within recent months that the contract for corporate legal services has sparked contention among the CDA board, which is chaired by Danny Solomon.


Following a T&T Guardian exclusive report, the law firm of Devesh Maharaj & Associates was terminated from providing corporate/legal services after financial statements surfaced showing fees to the sum of $75,000 being directly paid to the law firm—which also represents the CDA in several matters. The sum paid to Devesh Maharaj & Associates for corporate services was separate from the legal fees incurred by CDA for representation in several matters.


A senior official commented, “What transpired on August 3 is absolutely shocking. It is a clear attempt to manipulate the board. No minister is supposed to get involved in the day to day operations of a state enterprise. The board took a decision not to extend the contract and the minister is going against the decision...The role of the line minister at CDA has definitely been mixed up.” Since October 2011 a number of law firms have provided corporate secretary services to the CDA, owing to the vacant position.


Board clash over CEO
It was revealed that several directors had also voted against Joycelin Hargreaves being appointed as the acting CEO of the CDA. She previously filled the position of chief operations officer. “A vote was taken and seven out of the nine directors were against the acting appointment,” the official said. “A decision was taken unilaterally and the board decision was also overturned. What is the purpose of a board if all decisions are being ignored? If such actions are allowed then the appointments of boards are useless.”


Documents revealed directors had written to the chairman indicating their intention to move a vote of no confidence in Hargreaves at the next board meeting, which was scheduled for later this month. A copy of the letter was also sent to the minister, along with a second letter requesting an audit. Citing grounds for the audit, the directors listed the following:
• The lease agreement involving EOG Resources Trinidad Ltd and the deposit of a $2.4 million cheque from a third party
• Decisions taken without board approval
• Proper procurement procedures not being followed in the awarding of contracts
• Recruitment process flawed


“Business cannot continue the way it is going at the CDA,” the senior official stated. ”Very soon all that is going to be left is an empty shell. The company cannot become self-sustainable because there are too many irregularities taking place and no one wants to be held accountable.”


Tewarie responds:
Contacted on Friday, Tewarie neither confirmed nor denied that he had given a directive to halt all board and committee meetings at CDA. The minister said, “Meetings of the board are generally called by the chairmen. I have in fact indicated with the chairmen and other members of the board that I want to meet with them before the budget. I have issued invitations to them to attend a meeting with several boards so we could discuss matters.


“I do not know what is happening at the board in terms of decisions. That is the job of the chairman and corporate secretary." Asked if he had overturned the board’s decision not to extend the contract of the corporate secretary, Tewarie replied, “I received a letter from the chairman making a recommendation for the contract of the corporate secretary to be extended until the CDA is able to recruit a corporate secretary.”


Asked if board members voted against the extension of the contract to the corporate secretary, the minister said, “I do not know what the board did. I did what I had to do.” Meanwhile, regarding the rental of properties in Chaguaramas involving EOG and CDA, the minister said both parties had reached an amicable resolution and a lease agreement was signed. CDA chairman Danny Solomon could not be reached by phone on Friday and did not return calls.


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