Minister of Legal Affairs and Attorney General, Anil Nandlall has filed a Motion in the High Court against the Hand-in-Hand Mutual Fire Insurance Company to retrieve the US $1.54M Security Performance Bond that the company, as the guarantor for Synergy Holdings Inc. had agreed to pay if the construction company fell short of honouring the terms of the contract, the Government Information Agency (GINA) reported Friday.

In late 2011, Government executed an agreement for timely completion of the project with Synergy, under which the company agreed to certain undertakings. These undertakings included sub-contracting certain sections of the Amaila Falls road and providing a valid performance bond to Government to cover the period of the execution of the remaining works, and the defects liability period, given that the originally provided performance bond would not cover the entire period of the revised schedule.

Under the agreement, failure by the company to comply with these undertakings would result in the construction contract being terminated in January 2012, and certain other measures being instituted by Government.

Hand-in-Hand, as the guarantor, had undertaken to pay without any “cavil or argument” the sum of US $1.54M, if the contractor was found to be in default under the contract.

However, the insurance company failed to effect payment even after it was reminded by way of a letter from the Permanent Secretary of the Public Works Ministry Balraj Balram.

Government is now seeking the full sum, as well as an interest rate of 6% from the date of filing to the date of judgment and an interest rate of 4% until the full sum is paid.