THE People's Partnership administration will be committing "political suicide" if it opts to pay only the 250 Executive Flexible Premium Annuity (EFPA) policyholders who won a recent lawsuit against the State, and not the other 25,000 affected persons.
This was the statement made by Peter Permell, chairman of the Clico Policyholders Group, yesterday in response to a ruling handed down by High Court judge Joan Charles on Tuesday.
In a 47-page judgment, Charles ruled the Clico bail-out plan presented by the People's Partnership Government was unlawful.
The State has now been ordered to pay a group of EFPA policyholders, known as the United Policyholders Group, all the money they invested in the failed insurance giant, plus interest.
"It is ordered that the defendant do make good the said legitimate expectation by making suitable arrangements to ensure that the claimants, less those who have already accepted the Government's offer, receive a sum equal to 100 per cent of Clico's contractual liability to them," Charles's ruling stated.
The figure is expected to work out to $300 million, plus three per cent interest, from September 2010 to March 2013, for 250 people.
Permell said his attorneys are reviewing Charles's judgment.
"It should be noted that while at first blush the judgment appears to be limited to those policyholders who were part of this particular action, our attorneys are currently carefully reviewing this matter," Permell stated.
He said if all the affected policyholders are not reimbursed, the People's Partnership administration will suffer in the local government elections constitutionally due this year.
"In the circumstances and given the upcoming local government elections, we are persuaded that not only would it constitute inequitable treatment under the Constitution, it would be 'political suicide' for the Government to pay only 250 policyholders 100 per cent of their money, plus three per cent interest, and effectively 'short change' the other 25,000 policyholders," Permell stated.
"Simply put, it would be an untenable and unacceptable position for the Government to adopt. Accordingly, we will be seeking an urgent meeting with the Government to discuss these developments," he stated.
The successful United Policyholders Group was represented by Queen's Counsel Peter Knox, former attorney general Ramesh Lawrence-Maharaj, SC, Vijaya Maharaj and Nyala Badal. Permell congratulated the legal team for the "landmark victory".
"It is no secret that the Clico Policyholders Group has always contended from day-one that EFPA policyholders were legally entitled to be paid in full the terms and conditions of their policy contracts so that the judgment comes as no real surprise to us," Permell said.
Queen's Counsel Allan Newman, former attorney general Russell Martineau, SC, Kelvin Ramkissoon and Kerry Ann Oliverie represented the State.