The Ministry of Planning and Economy did not comply with the Central Tenders Board (CTB) Act when it tendered and selected the three developers for the billion-dollar Invader’s Bay Development project, a legal opinion provided to Attorney General Anand Ramlogan has concluded.
The legal advice is the subject of a long-running legal battle between the Ministry of Planning and the Joint Consultative Council for the Construction Industry (JCC), who sought the document under the Freedom of Information Act.
Dr Bhoe Tewarie, the Minister of Planning, has refused to provide the advice he received that allowed the ministry to procure tenders for the development of the Invader’s Bay project. High Court Judge Frank Seepersad ruled on July 14 that the ministry should make the information available, but Tewarie served notice
Government intended to appeal the decision.
The legal document, made available exclusively to the Sunday Express, shows that far from endorsing the decision of the Ministry of Planning, serious questions were raised by the AG’s office on the procedure used by the Ministry of Planning in procuring bids for the billion-dollar project.
The advice was provided by Joan R Furlonge, legal adviser to the Attorney General, on February 13, 2012.
The Government, through the Ministry of Planning and Economy, invited expressions of interest for the development of Invader’s Bay on August 31, 2011. Developers were given an October 4 deadline for submissions.
In November, a Ministry of Planning and Economy team—comprising the permanent secretary, the deputy permanent secretary and the senior planning officer—determined three developers (out of ten submissions) met the requirements of the request for proposal (RFP). These were Invader’s Bay Marina Development Company; M Falcon and Dachin Commercial Development Company.
Additionally, on December 2011, the Ministry of Planning and Economy wrote letters to the three selected developers, advising them of the decision and informing them they would be contacted to “schedule a date for commencement of this negotiation of terms and conditions”.
Furlonge noted under the CTB Act the Government can only act on its own, without reference to the Central Tenders Board, where it enters into
a contract with the National Insurance Property Development Company (Nipdec) or a Cabinet-approved special-purpose company such as the
Urban Development Corporation of Trinidad and Tobago (UDeCOTT), which is wholly owned by the State, for the supply of goods, works or services.
“If UDeCOTT was responsible for the tendering/procurement process, the CTB could have been circumvented (under Section 20 A CTB Act).... This option is still open to the Ministry of Planning and Economy as the process advances to maturity and pursuant to Cabinet Minute No 813 of April 8, 2010,” Furlonge stated. [By Minute No 813 the then (People’s National Movement) cabinet, noting several international firms had expressed interest in developing the site, had authorised UDeCOTT to seek further expressions of interest for the establishment of a range of commercial enterprises in the Invader’s Bay area].
However, Furlonge noted: “The Ministry of Planning and Economy does not have within its contemplation that it would enter into a contract with UDeCOTT for the undertaking of works required for the Invader’s Bay project. But the option to do so is still open to the Ministry of Planning and Economy although the ministry has in fact already tendered and selected its developers. In the circumstances, the tendering process adopted by the Ministry of Planning and Economy does not fall within the exception under Section 20A of the Central Board Act.”
Furlonge noted according to the White Paper for Public Procurement, the “current procurement practice under the Central Tenders Board Act” is initiated when the ministry or department conducts a needs assessment, reconciles its needs with the available funds and prepares a bid package.
The Central Tenders Board’s involvement in the procurement process includes selection of procurement method, inviting tenders, receiving tenders, evaluating tenders and making recommendations, selecting suppliers/contractors/consultant and issuing letters of acceptance, she noted.
Furlonge states: “In reconciling the actions taken by the Ministry of Planning and
Economy with the law, it appears that the Ministry of
Planning and Economy’s actions can be validated on the grounds that the procurement process under the CTB Act was not initiated as the Ministry of Planning and Economy did ‘not require public funding’ and there was therefore no need to ‘reconcile its needs with available funds’.
“It should be noted that negotiations on formulation of terms and conditions of leases are in their infancy and it has not yet been determined whether the developers would accept responsibility for the infrastructural development of their respective proposed acreage of lands at Invader’s Bay,” she said.
“It is however possible that public funding would be required for infrastructural development of Invader’s Bay in due course and that that would fall within the remit of the CTB,” she noted.
Furlonge continued: “It is relevant to note that the CTB was established by Act 22 of 1961 to ensure that the proper procedures were following to obtain the most suitable supplies and services from available resources utilising the procurement process. Thus, on the face of it, the Ministry of Planning and Economy’s rationale was that the Invader’s Bay area was a prime area for development in the public interest and that no public funding and, therefore, no CTB input, was required.”
“There is however a thin line between adopting this stand and reconciling it with the law (Section 4 of the Central Tenders Board Act), which states that the CTB has the “sole and exclusive authority...to act for, in the name of and on behalf of the Government...in inviting, considering and accepting or rejecting offers for...or for the undertaking of works or any services in connection therewith, necessary for the carrying out of the functions of the Government”.
Furlonge added: “It is submitted that this would be a very tenuous position to maintain for a multimillion project which is attracting widespread public scrutiny.”
Furlonge noted further the Central Tenders Board (Functions and Duties) Order, Legal Notice 179 of 1997 states as follows: “The functions and duties of the Central Tenders Board is hereby extended to include the authority to act for, in the name and on behalf of the Government to dispose of real property owned by the Government in such a manner as the Government may deem appropriate and desirable”.
Furlonge concluded “real property is defined as land and anything growing on, attached to, or erected on it, excluding anything that may be severed without injury to the land. Real property can be either corporeal (soil and buildings) or incorporeal (easements).”
She however contended Legal Notice 179 of 1997 did not state the CTB is the “sole and exclusive authority” to act for, in the name and on behalf of the Government to dispose of real property owned by the Government. “It is arguable that if Parliament intended that the disposal of real property be executed only by the CTB, the Legal Notice/Order to amend the Central Tenders Board Act would have been explicit in stating such “.
“It is submitted that the Invader’s Bay Development Project does not fall within the remit of Legal Notice 179 of 1997 on the grounds that the State would not be granting legal title of the lands to the proposed developers but leases would be granted whereupon the lands would revert to the State at the end of the lease,” Furlonge said.
Furlonge stated while “it is arguable that it is mandatory that the tendering process for the disposal of real property is governed only by the CTB Act...
in any event, it is submitted that the tendering process of the Invader’s Bay Development Project does not involve the disposal of real property as the subject lands would be leased to the proposed developers with an option to renew at the end of the lease”.