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$17m CHEQUE OUT

...six days before SporTT got legal advice to pay Daniell second half of $34m LifeSport contract

By \\\\\ Asha Javeed asha.javeed@trinidadexpress.com

Six days before the Sport Company of Trinidad and Tobago (SporTT) received legal advice to pay an outstanding $17 million payment to Adolphus Daniell’s EBeam Interact, a cheque had already been made out to him.

Daniell’s cheque for $17 million—the second half of a $34 million payment from the now defunct LifeSport programme to teach Maths and English — was dated February 11, 2014.

SporTT received legal advice from attorney Anja Dass from JD Sellier on February 17 that it “is legally obligated under the contract to issue the remaining balance of the TT$17 million to E-beam”.

It was the second time that JD Sellier had advised SporTT on Daniell’s contract. On January 17, 2014 it had outlined the legal options SporTT had with regard to the contract such as arbitration and re-negotiation of employment terms.

However, despite this, a cheque for the outstanding $17 million was made to Daniell on February 11.

In an e-mail dated February 17, Dass stated: “We suggested that ideally the parties should negotiate terms and conditions of works yet to be done before the payment is made. We further advised that the said payment should be negotiated to be paid in installments based on the works to be done.

“However, given the lack of co-operation on the part of EBeam to meet and negotiate any new terms/condition amended contract until said payment is made to him we advised that SporTT was left in no other option but to pay the contracted balance, given SporTT’s position under the contract.”

The audit into Life-Sport revealed that Daniell was paid $34 million although  no work was done. His $34 million payment was the single biggest payment of the programme for no work unearthed by the Central Audit Committee’s audit into LifeSport. 

Daniell has said he has no intention of returning the money.

“The thing about it is, it is a non-issue because the only way under a contract anything is recoverable is if the other party is in default. There was never a single letter of complaint that I was in default of this contract. Not even a phone call,” he has said.

Even as the Express attempts to piece together just who gave approval for the Sport Company to approve Daniell’s contract, the rationale for paying Daniell the entire sum for no work and whether any objection to the contract was raised by permanent secretary Ashwin Creed as the ministry’s accounting officer, documents obtained by the Express show a timeline on how the second $17 million payment was made.

It was former chief executive John Mollenthiel who drafted a note for the board of SporTT to approve the final payment based on his recommendation.

On November 25, Mollenthiel wrote to SporTT chairman Sebastien Paddington noting: “At this time, we are in breach of our contractual obligations and the lack of such payment is adding to delays in the commencement of active teaching (now pushed to February 2014). Subject to your agreement, I’m asking this be circulated via round robin to the board for a decision by close of business tomorrow — i.e. Tuesday, November 26th, 2013.”

By December 2, the note was circulated to the board by SporTT’s corporate secretary Dawn Mohan. The email, in part, stated: “Directors are being asked to indicate whether you approve the recommendation contained in the Board Note by 4 pm on Wednesday 4th December 2013 please.”

Mollenthiel’s note on the “Decision Item” of the “2nd payment to EBeam” observed that: “On account of the delegated financial authority limit of the Permanent Secretary (i.e up to $1 million), the contractual arrangement for these two components are handled by SporTT.”

“By submission of a written synopsis on November 16th 2013, EBeam has, inter alia, reiterated the need for the second payment of $17 million as per contract. The processing of this payment is directly related to the commencement of active teaching, which is now proposed for the first week in February 2013. According to EBeam, any further delays in processing the said payment will serve to further delay the already protracted timeline of February 2014,” noted Mollenthiel.

“The Board is informed that the costs of the contract have been provided for and the sums which are due and owing will be drawn down from the existing loan facility with First Citizens Bank Limited. The Board is further informed that the Bank has recently approved an extension of 45 days on the drawdown period for the loan (previously October 31, 2013.) A brief opinion from SporTT’s Legal Department on the options which are available to SporTT with regard to this request for payment of $17 million is also attached. The opinion supports the CEO’s recommendation to pay the outstanding $17 million as per the obligations set out in the contract between SporTT and EBeam,” he said.

Mollenthiel was interviewed by the Central Audit Committee on July 9 and said he signed the contract to avoid undue delays in the implementation of the literacy component.

“ He said he did not consider the suggested changes to the shortcomings of the contract identified by SporTT legal since he was told that the contract should be ‘loose’, a word he coined as he could not recall the actual word used. He denied that prior knowledge of Mr Daniell’s track record as an educator influenced his decision to sign a ‘loose’ contract. He said another reason for signing was that he always believed Mr Daniell would deliver since he felt that he had an international image to maintain. In hindsight however he believes that he may have been set up and regretted signing the contract. He said he is also astonished at Mr Daniell’s current ‘nit-picking’ behaviour,” the Central Audit Committee’s report into LifeSport stated. 

The Express contacted Mollenthiel last week but he declined to speak about the EBeam contract or LifeSport. The Express tried several times to contact him by phone and text massages yesterday but was unsuccessful.

The board of  directors of SporTT are Reynold Bala, Norris Blanc, Nisa Dass, Anyl Gopeesingh, Sabrenah Khayyam, Matthew Quamina, Annan Ramnanansingh, Kent Samlal, Milson Siboo and Harnarine Singh.

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