Brassington attempts to take out US$27M debenture on Marriott
…attracts immediate court action seeking injunction
Litigation continues to pile up against Atlantic Hotel Inc (AHI), this time with A Partnership for National Unity’s (APNU)
Desmond Trotman
Desmond Trotman moving to the court to prevent the company from taking out a US$27M debenture it is seeking from Republic Bank Limited.
Trotman, through his Attorneys Rex McKay, Neil Boston, Bettina Glasford and Brendan Glasford yesterday filed the affidavit seeking an injunction preventing the financial transaction.
On November 22, AHI caused to be published in the Official Gazette a notice indicating that the company was looking to take out a mortgage against the land and building of the Marriott Hotel being constructed in Kingston.
Trotman has already filed Notices of Opposition against that transaction.
On November 29 also, AHI caused to be published in the Official Gazette, the fact that it was looking to take out three debentures against the same property totaling US$27M.
Trotman has since moved to the court to prevent this transaction by way of an injunction.
Winston Brassington as head of AHI had moved to Republic Bank to secure a mortgage, which the company explained was in fact the US$27M Syndicated Loan it had approached the bank for, now there is the US$27M debenture from Republic Bank as is being advertised in the Gazette.
In October last, Trotman had moved to the court for an injunction seeking to restrain the Attorney General, National Industrial and Commercial Investments Limited, AHI and Winston Brassington from mortgaging, leasing or in any form or manner transferring the title of the property.
He had also sought a Conservatory Order seeking to restrain the Minister of Finance from encumbering, mortgaging, leasing or in any form or manner transferring the properties or from authorizing NICIL, AHI or Brassington to undertake any similar such transactions.
None of these matters have been concluded and are all pending before the court but this has not prevented Brassington from seeking to acquire the US$27M debenture.
According to the notice published in the Official Gazette, the debenture will confer a Fixed First Charge ranking as a First Mortgage on the property, and also ranking pari pasu with First Mortgages executed or to be executed by the Company in favour of the Bank on the said property.
According to Trotman in his Affidavit, the public trust doctrine enjoins upon the government to protect the ocean front state property and that the land cannot be sold or transferred by government for commercial purposes.
Yesterday’s resort to the court comes on the heels of Trotman filing three notices of opposition against the mortgage Brassington is seeking against the Marriott from Republic Bank.
In filing those documents, Trotman contends that he has a duty under Article 32 of the Constitution, “to combat crime and other violations of the law and take care of and protect public property.”
The Member of Parliament is adamant that AHI which is the Special Purpose Vehicle (Company), established by the National Industrial and Commercial Investments Limited (NICIL) to build and own the Marriott Hotel, is unlawful.
He further charges that AHI was set up as a subsidiary of NICIL “for the sole and predominant purpose of unlawfully diverting moneys raised by Guyana, which should be paid into the Consolidated Fund, but are used for financing the construction of the Marriott Hotel, a project not approved by Parliament.
Trotman in his Notice of Opposition argued that AHI is not the competent body to mortgage the property in question or any part of it, without the expressed approval of Parliament.
Following the publication of the notice in the Official Gazette, AHI in a public missive sought to clear the air and said that the publication of the mortgages is, in fact, concrete evidence that the financial arrangements with Republic Bank Limited are being concluded, and that the funding has been committed by the bank.
“The publication of these mortgages are (sic) consistent with standard procedures for the security of a loan agreement and are in line with the financial arrangements published in the feasibility studies for the construction of the hotel project,” according to AHI.
AHI also used the opportunity to remind that the conclusion of the Republic Bank financing is a requirement for the conclusion of the arrangements with the principal investors to acquire 67 per cent of the equity of AHI.