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AG requests $1.3b to settle OPV arbitration
Attorney General Anand Ramlogan has gone to Cabinet requesting $1.3 billion for a settlement with respect to the cancellation of the three offshore patrol vessels (OPVs). Meanwhile the arbitration over the OPVs is still ongoing. The Sunday Guardian was informed that on Thursday Ramlogan took a note to Cabinet seeking approval for the money and that the matter was considered.
Sources said during the Cabinet meeting, which was held on Thursday and chaired by Foreign Affairs Minister Winston Dookeran—in the absence of Prime Minister Kamla Persad-Bissessar—the matter was deferred to next week, when a decision is expected to be made.
When the matter was brought before Cabinet some ministers raised concerns about it, while others openly objected as they questioned why the payment should be approved, since the arbitration was still in progress. At least three ministers were reportedly vocal during the meeting, questioning the haste and timing of the request.
The meeting got so heated, sources said, that Dookeran walked out, saying he wanted no part of the decision to make the money available. When contacted, some Cabinet ministers confirmed the decision, but refused to go on record when questions were posed to them.
One minister said, “I am not allowed to speak on that issue, that is prejudicing the interest of the country. The process is still ongoing and such a report will prejudice the matter.” Another minister said, “Not me and that matter, nah. Ask me anything else. I have nothing to say on that issue. Leave me out of that matter.”
One irate Cabinet source questioned why the Government would want to pay $1.3 billion in arbitration fees rather than paying $1.5 billion for the three OPVs instead.
AG: Where did you hear that?
Contacted on Friday night and asked about the status of the OPV arbitration, Ramlogan said, “I don’t know.” Asked about the request to Cabinet for $1.3 billion, the AG laughed, saying, “Where did you hear that?” Saying he was in the middle of a break since the censure motion against him was in progress in Parliament, Ramlogan said he needed to return to the chamber and listen to what was taking place.
On October 17, during the budget debate, Ramlogan said he had been micromanaging the OPV issue and described the arbitration as “massive.” He had said the impact of the possible loss of this or other arbitration cases could leave T&T’s economy “reeling” and “catapult T&T downwards.”
Ramlogan’s statement on OPV arbitration
On June 15, 2012, Ramlogan issued a media release chastising statements by Opposition MP Colm Imbert. Imbert, in statements to the media, had said the Government had lost the OPV arbitration and was in fact liable to pay millions of dollars to British defence manufacturer, BAE Systems.
Ramlogan, in his release. said Imbert’s claims were “totally mischievous and completely false.
“It is, quite frankly, a reckless statement which bears absolutely no resemblance to the truth. In fact, the arbitration hearings have not yet been completed, with the parties scheduled to make their respective closing submissions to the Arbitration Tribunal later this month. Furthermore, the hearings have been in relation to liability only thus far, and the dates for the hearings on quantum are still to be finalised.
“In the circumstances, the statement of Mr Imbert that the GORTT is liable to pay money to BAE is simply ludicrous and a pathetic attempt to deflect public scrutiny away from his role in the purchase of the water taxis.
“Nevertheless, in stark contrast to the Opposition’s modus operandi in dealing with all matters of national importance, this Government shall continue to act responsibly in this matter and refrain from making any further comment at this time in relation to a legal dispute in which a decision has not yet been delivered.”
Griffith, AG travelled for talks with BAE Systems
On July 21, 2011, national security adviser Gary Griffith and Ramlogan travelled to England for arbitration talks with BAE Systems. Ramlogan and Griffith were invited by BAE Systems to have the arbitration talks with respect to the Government’s cancellation of three OPVs from the company.
In April 2007, BAE was awarded the contract to build, integrate, test and commission three OPVs for the TT Coast Guard. Construction began January, 2008. However, in September 2010, Persad-Bissessar announced that Government had decided to cancel the three OPVs ordered by the PNM administration at a cost of $1.5 billion. Notice of the cancellation was served on September 17 last year.
The Government said the decision to terminate the contract was due to persistent delays and technical deficiencies.
Brig John Sandy’s response
On October 25, 2011, then National Security Minister Brig John Sandy, responding to a question filed in the Senate by Opposition Senator Fitzgerald Hinds, said the State had spent a total of $4.7 million in legal fees to pursue a claim for $1.5 billion in damages in arbitration proceedings for the cancelled OPVs.
Sandy had said the contract for the OPVs with BAE Systems was cancelled on October 20, 2010, owing to “substantial material delays” in delivery. He said BAE, a British arms company, attempted to effect delivery of the OPVs but this was not accepted by the Government because of defects in the vessels.
As a result, BAE began arbitration proceedings at the International Court of Arbitration at the International Chamber of Commerce, Paris, France on the October 26, 2010, claiming the contract for the OPVs was still valid and the planned cancellation invalid. The Government, however, counter-claimed contractual damages totalling £145 million (TT$1.4 billion), Sandy said.
Hearings took place in London from May 7-18, 2012. Sandy disclosed that the lawyers hired by the State in relation to the matter included: Charles Russell (solicitors); Joe Smouha, QC; Alan Newman, QC; Neal Bisnath; and Ricky Diwan.
The $1.5 billion OPV contract was signed by the People’s National Movement administration in April 2007. A cancellation notice was served under the present administration on September 17, 2010.
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