Senior Reporter
kevon.felmine@guardian.co.tt
Former minister of Works and Infrastructure Jack Warner yesterday chose to remain quiet on a Privy Council ruling which ordered him and his companies to pay over $1.5 million to Real Time Systems Ltd (RTSL) for an outstanding loan, which he claimed was a donation towards the United National Congress’ failed 2007 General Elections campaign.
“I have nothing to say regarding any matter with Krishna Lalla” and “I have no comments to make” was all Warner said to Guardian Media when contacted.
In handing down their ruling yesterday, Lords Hodge, Lloyd-Jones, Kitchin, Hamblen and Stephens found several findings in the Court of Appeal’s rejection of trial judge Frank Seepersad’s judgment misplaced, saying he did not fall into error.
The committee allowed RTSL’s appeal yesterday and upheld Seepersad’s ruling of May 15, 2018, that the $1.5 million was indeed a loan and ordered Warner, Renraw Investment and CCAM and Co Ltd to repay the sum with interest at the statutory rate until repayment.
Warner, Renraw Investment and CCAM and Co Ltd, traded as the Dr João Havelange Centre of Excellence (Centre), with Warner as their agent.
Robert Strang and Kiel Taklalsingh, instructed by BDB Pitmans LLP, London, represented RTSL, while John Jeremie SC, Richard Thomas KC and Jacqueline Chang stood for the defence.
The Privy Council heard the appeal on May 15, which arose from a proceeding brought by RTSL, an information technology services company which shared a compound with Super Industrial Services Ltd (SISL).
The case entailed Warner, then UNC chairman, approaching former SISL founder Krishna Lalla, who the High Court identified as an agent for RTSL.
In October and November 2007, RTSL paid all three defendants with five cheques made out to the Centre. In a letter dated March 17, 2010, RTSL wrote to the Centre demanding payment and later initiated legal proceedings.
During submission in 2014, RTSL claimed there was an oral loan agreement around August 2007 with Lalla and Warner, with an agreed repayment on February 28, 2008, from US$10 million, which Warner said the Centre would receive from FIFA. RTSL also alleged that the defendants were to secure the loan by executing a charge over the Centre.
It said, “Mr Jack Warner represented to Mr Krishna Lalla that the defendant was experiencing difficulties meeting its financial obligations, including the payment of salaries, loan payments and other expenses. The purpose of the loan was to assist and enable the defendant to meet these financial obligations until the defendant received the US$10 million which Mr Warner indicated it would receive from FIFA in February 2008.”
The defendants admitted they received the money but denied it was a loan. It argued that it was an arrangement between Lalla and Warner for financing the UNC election campaign.
The defendants also claimed that Lalla had offered to fund the campaign with $20 million, along with Mr Warner, who was said to be a UNC financier.
In his witness statement, Lalla said Warner visited his office in August 2007, indicating that he needed to raise a loan of $20 million to assist the Centre, as it had liquidity problems.
“He pleaded with me to assist. Although I trusted Mr Warner at the time, given the amount of money involved and that I would have to raise the money from third parties, I enquired what form of security he had available and how he proposed to repay this sum,” Lall said.
Lalla said Warner indicated he would execute a promissory note and provide a charge over the Centre. Following further discussion, he approached several business colleagues, including RTSL general manager Romila Maharaj, who agreed to loan $1.5 million.
However, Lalla said Warner never issued the promissory note or executed the charge over the Centre.
In his witness statement, Warner said they met Lalla in February 2007, where the businessman spoke of several failed initiatives. Warner told Lalla about his plan to remove former prime minister Basdeo Panday as UNC political leader, and he wanted to assist as a financier.
“From our discussions, Mr Lalla was most concerned about what would come out of his efforts to assist the party, and in fact, he openly asked me what is in it for me,” Warner said.
At trial before Seepersad in 2018, RTSL provided emails to establish that Warner and his companies were in financial difficulties, lacked standing with Republic Bank, and had difficulties securing finance. They also showed that Warner did not challenge or deny he was obliged to make a repayment.
In his judgment, Seepersad said, “The correspondence demonstrated that the financial arrangement between the two men was not gratuitous but was one characterised by an expectation of repayment and representations as to part payment were, in fact, made by Mr Warner.”
Seepersad also noted Warner’s evidence about Lalla asking “what was in it for him” and that the defendant’s counsel had told Lalla that he and his companies had benefited substantially from State contracts between 2010 and 2015.
Seepersad said this caused him disquiet, and there was an entrenched public perception that money paid through campaign finance was the functional equivalent of bribes to ensure favourable treatment by a government.
Ten months later, Seepersad referred to his judgment at a Transparency Institute event on March 28, 2019, particularly about campaign finance.
He drew attention to Warner’s position that Lalla had been repaid for his donations by the award of contracts. He described the position as “unfathomable.”
It was one of the reasons Warner appealed Seepersad’s order.
Defence attorneys submitted to the Court of Appeal that Seepersad made material errors in analysing the evidence, and his remarks at the TTTI event met the test for apparent bias. The attorneys asked the Appeal Court to set aside Seepersad’s order.
Appeal Court Judges Smith, Jones and Pemberton unanimously allowed the appeal, finding that Seepersad made material errors.
The Court of Appeal assessed the evidence and ruled that the money was a gift in the form of a political donation.
It set aside Seepersad’s orders, dismissed the RTSL’s claim and ordered the company to pay the defendants’ prescribed costs quantified on the $1.5 million figure and the costs of the appeal.
However, RTSL filed an appeal to the Judicial Committee of the Privy Council, contending that Seepersad was entitled to make his findings on the evidence and that the test for establishing apparent bias was not satisfied.
Among its conclusions, the Privy Council said it considers that Seepersad did not base critical factual findings on the image Warner wished to portray. Instead, it found that Seepersad’s reasoning was on the contemporaneous emails.
