Wednesday, January 18, 2017

...‘Difficult to enforce legal advice on CDA leases’

‘CLOUDY CIRCUMSTANCES’: Stuart Young


Government has obtained legal advice from Senior Counsel Martin Daly that it would be difficult to enforce the legal advice of his colleague, Elton Prescott SC, that all leases entered into by the Chaguaramas Development Authority (CDA) between 2010-2015 were “illegal”.

This was disclosed yesterday by Minister in the Office of the Prime Minister Stuart Young at a news conference at the Offices of the Attorney General and Legal Affairs in Richmond Street, Port of Spain to provide an update on the leases at the CDA.

“Senior Counsel Prescott did say these leases were illegal because they were not in conformance with the 1974 Development Plan. It is not as simple as that. When we sought further legal advice on that issue to be able to enforce exactly that, the legal advice which we have received and accepted it is not as simple as that. That there would be certain expectations. So we're not looking at necessarily enforcing along those lines,” Young said.

In May, Prescott had provided a legal opinion to the CDA which stated that the leases are “illegal in so far as they are not in conformity with the 1974 plan. As a consequence, they are not enforceable at law.”

The CDA board, then chaired by Anthony Pierre, had recommended that all leases entered during the period 2015 to 2016 be “deemed illegal and therefore null and void.”

Those leases, identified by former CDA chairman Anthony Pierre in a report to Planning Minister Camille Robinson-Regis, would have applied to several entities: The Water and Amusement Park, The Hart's Cut Development, Animals for Education, Point Gourde Development, Boqueron Restaurant, Shoreline Marine and Hard Rock Cafe, Starburst Mini Golf and Adventure Park, Chaguaramas Parking Limited Car Park and Chaguaramas Golf Course Driving Range Project.

Young said the Government believed several leases were granted “in somewhat cloudy circumstances” but it would do what it can to protect the public's interest in Chaguaramas.

Young said Daly and a legal team “will begin conversations with these people in the coming weeks”.

John Aboud gets a cut

 

Young said the Government had cancelled one of the leases held by businessman John Aboud's Chaguaramas Parking, which was to build a car park with 1,000 spaces.

According to an Ernst & Young (EY) audit conducted on “selected” leases during the period 2010-2015 which looked at the tendering process and award of key contracts during the period 2012-2015, Aboud's Chaguaramas Parking would pay $1 in rent a year for 1.62 hectares of land.

According to the report, the land is on the Western Main Road and EY had determined that it was an “unfavourable” sublease rental as Chaguaramas Parking was given a option to renew the lease for another 30 years.

“CPL's remit was to construct a car park and subsequently lease the car park back to the CDA at a monthly rate of $898,000,” the EY report said. The report noted that the break even number of vehicles required to utilise the car park facility on a daily basis at a rate of $50 a day, in order to cover the lease expense of $10.8 million and operating costs of $2.8 million, is estimated at 742 vehicles.

The company was incorporated on February 12, 2015 and its lease was granted on May 22, 2015.

Aboud had told the Express that it made no sense setting up his Waterpark business, being done by another of his companies Fouraime Enterprises, without the requisite infrastructure in place to support the potential traffic.

The Government has also re-negotiated the amount of space Aboud would get on the waterfront for the waterpark.

Aboud has a 30-year lease for 35.1 acres of CDA land, a waterfront property that a river runs through, for which he pays about 500,000 a month. Fouraime's plans for the land include an amusement park, a water park, a mall and a car park to service the enterprises.

Land reclaimed

 

Young said that the Government would take back Pier 2 to develop a marine hub for a water taxi from Port of Spain to Chaguaramas. And since the lease to Chaguaramas Parking was cancelled, the CDA was now mandated to find another spot for parking as the Waterpark's lease had a provision for 1,000 car park spots.

He said the decision was taken by Cabinet on Thursday on advice from an ad hoc committee headed by Finance Minister Colm Imbert and included Planning Minister Camille Robinson-Regis and himself.

“There are a number of difficulties with regard to the enforcement of that and it is not a straightforward case,” he said.

He said the Office of the Attorney General has retained Daly to lead a team of lawyers to provide advice on a number of leases.

“Whilst there may have been some difficulty in implementing the legal opinion of Senior Counsel Prescott ultimately we recognise as the state, we have the power to utilise compulsory acquisition in circumstances where we believe it is in the public's interest and the land will be used in the public's interest,” he said.

“So I am happy to announce we did not have to resort to that,” he said.

He said the Government had managed to reclaim some land and more shoreline for the taxpayers.

“The Cabinet approved the recommendations of the ad hoc committee and we were able to return to them some critical pieces of natural infrastructure. This was done without legal proceedings,” he said.

Young said it was the first step in dealing with the Chaguaramas issue and described it as a “satisfactory conclusion.”

When asked whether the business granted leases were allowed to have operational business, he responded: “One of things we are looking at is approvals, failure to have those approvals and enforcement of the law. This Government will not condone anything that is illegal.”