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Petrotrin’s $b lawsuit against Jones collapses
The State’s billion dollar case against former Petrotrin executive president Malcolm Jones for negligence over the company’s failed low sulphur diesel plant has collapsed.
The company on Monday was forced to withdraw its case against Jones after its attorneys advised that he had a strong likelihood of defending the claim in light of new evidence which would have been made available to him.
Its decision now means the State has to pay Jones’ legal costs estimated to be a little over $3 million. During a brief hearing before Justice Ricky Rahim in the Port-of-Spain High Court yesterday, attorneys for the State made submissions seeking to have the sum lowered. Rahim reserved his decision to next week.
Speaking at a press conference after the hearing at his Cabildo Chambers office in Port-of-Spain, Attorney General Faris Al-Rawi explained the State’s legal team, led by Queen’s Counsel Vincent Nelson, gave the advice after Jones’ attorneys made an application for disclosure of documents related to Petrotrin’s arbitration with World GTL Inc, the company it had contracted for the plant.
“I understand the witnesses were very convincing at the arbitration proceedings and there is no reason why in the circumstances there is a reasonable likelihood that a judge would be persuaded that this was a bad business decision but not negligence,” Nelson said in written advice sent to Petrotrin and the Office of the AG in October last year that was quoted directly by Al-Rawi.
Al-Rawi noted that Nelson had not had sight of the evidence when he advised that there was a prima facie case against Jones in 2011 and was only made aware of it when Jones’ attorneys filed their application last year.
The Attorney General attributed responsibility for the collapse of the case on his predecessor, Anand Ramlogan, who he claimed failed to disclose the evidence to the attorneys even after he spoke on the Government’s successes in the arbitration proceedings in 2012 and 2014.
“T&T is going to have to pay $3.179 million in legal fees for a claim that if clearly one had paid attention to the arbitration proceedings, which the last government was so proud to speak of, surely a claim such as this would have not been launched. Surely counsel would have been provided with all the material so a proper opinion could have been provided,” Al-Rawi said. He was also critical of other corruption lawsuits initiated by Ramlogan during his tenure as AG, including a similar lawsuit against the former board of the University of T&T (UTT) over the lease of a guest house for staff which was withdrawn during a trial last year.
“It is therefore of something of great concern for a country to look at material like this, especially when we are aware that the UTT claim dissolved in the witness box.
“That was another product of Mr Ramlogan’s charge against what he considered to be allegations of corruption, which collapsed and caused the State millions of dollars in fees and judicial time,” Al-Rawi said as he noted his office had already paid almost $45 million in legal fees for the arbitration and the case against Jones.
Al-Rawi also claimed that in addition to the issue of new evidence, his office did not have any documents related to the case even though it was in charge of managing it on Petrotrin’s behalf.
“While on record the AG’s office was driving this action, I am confident to report that we had not one single shred of paper related to this case,” Al-Rawi said as he claimed he only discovered Nelson’s advice on how the case should proceed when he requested that the private legal team hired for the case provide him with copies.
However, despite his criticism Al-Rawi stated that the Government would not be discontinuing all cases filed by Ramlogan and was currently assessing the status and validity of those still before the courts. “This track record, notwithstanding, the current Government will continue to pursue all bonafide litigation that has commenced, provided there is merit in relation to it. We have been careful to demonstrate with our conduct of this management litigation that we have not gone idly by and changed legal teams to procure a certain result, far from it,” Al-Rawi said.
Gerald Ramdeen and Varun Debideen appeared alongside Nelson. Former attorney general John Jeremie, SC, and Kerywn Garcia represented Jones.
About the case
In 2013, the Office of the Attorney General filed a $2 billion lawsuit arising out of a forensic report into the construction of the failed Gas-to-Liquids (GTL) plant at State-owned Petrotrin’s operations in Pointe-a-Pierre.
The forensic probe was one of many mega projects undertaken by the previous People’s National Movement (PNM) government.
Petrotrin was claiming that there was a breach of fiduciary duty in the management of the construction of the GTL plant at Pointe-a-Pierre, which was contracted to be built at a cost of $2.7 billion to convert natural gas into a more ozone-friendly liquified form of diesel.
United States-based World GTL Inc was contracted to equip the plant with the necessary technology and make it operational.
Though completed, the plant remained non-functional due to the lack of the appropriate technology and it has since been deemed scrap iron. Petrotrin initiated arbitration proceedings against the company which it eventually won.
The lawsuit against Jones alleged mismanagement by the payment of US$190.4 million (TT$1.12 billion) towards construction of the plant, in excess of the cost of its construction.
It claimed that despite concerns raised in some quarters Petrotrin went ahead with the project. In October last year, with the trial of the case still pending, Cabinet appointed Jones as a member of its Standing Committee on Energy.