Guyana’s judiciary unprepared for legal issues from oil and gas sector –Lawyer
Jul 19, 2017 , http://www.kaieteurnewsonline....d-gas-sector-lawyer/
By Kiana Wilburg
Several legal experts are of the opinion that Guyana’s judicial system is currently not prepared for the complex legal issues that may arise from the looming multi-billion dollar oil and gas sector.
Specifically making this statement to Kaieteur News yesterday was attorney-at-law, Sanjeev Datadin.
Datadin, who has worked with several international oil and gas companies, holds the view that Guyana’s judicial system is simply too slow, understaffed and lacks individuals with the necessary knowledge and skills.
In the case of legal issues to arise from the oil and gas sector, Datadin predicts that most companies will opt for arbitration.
He opined that there will be arbitration centres just as there are in Trinidad. The attorney-at-law believes that major companies which come into Guyana are going to be distrustful of the judicial system given the perceptions of how long cases take to be heard, how easily records get lost, personalities involved, among other discouraging perceptions.
Datadin said that the arbitration process would have to go up parallel to the court system since this is how it is usually done.
“It usually would come through the business sector; the chamber of commerce and similar things would establish arbitration tribunals and panels and then you would need a list of arbitrators.”
Datadin continued, “The difficulty that we might have immediately is that we might not have judges who would be able to deal with specialized engineering or other (oil and gas) issues. And in those cases, they are rather unsuitable for a court. They are better suited for arbitration.”
“But we are going to have enormous pressure regarding delays; we are going to have major investors who are spending money daily on rigs and similar things who will have to wait for so long for hearings and judgments and then for written reasons from judges.
“As a result of that, people are going to opt out of the strict legal system and go for arbitration. It will be a one and done…”
The attorney asserted that Guyana’s judiciary is simply not equipped to deal with real commercial activity. He said that what Guyanese have on their hands is a court system that has at its foundation, delays and unenforceability.
“But as it is, Guyana’s judiciary is just unprepared…We are unprepared because we just don’t understand how to get cases out quickly. In other territories, like in the Eastern Caribbean, commercial cases probably take six months to finish. In Guyana, it takes way too long,” expressed Datadin.
The question of the preparedness of the judiciary has been raised in recent times, especially when some critics take into consideration, the track record of US oil giant, ExxonMobil, and the wave of litigation it has faced over the years.
In the case of Chad, ExxonMobil was fined US$74 billion as it was ruled in the courts that the nation was underpaid the royalties t which it was entitled from the oil giant.
Research indicates that the fine itself is about five times more than Chad’s Gross Domestic Product, which the World Bank estimates at US$13 billion.
The fine imposed against the company was handed down October 5, last, by the High Court in the capital, N’Djamena. The ruling was in reaction to a protest from the Finance Ministry in Chad that a group led by the ExxonMobil giant did not honour its tax commitments.
According to www.bloomberg.com, the court also demanded that the Texas-based oil explorer pay US$819 million in overdue royalties.
Legal minds believe that Chad would not see most of the money as ordered by the court.
ExxonMobil has since said that it disagreed with the Chadian court’s ruling. At the time of the judgment, it was examining other options.
Furthermore, in 2003, ExxonMobil was found to be defrauding the state of Alabama out of royalty payments and was ordered by the courts to pay up more than US$100 million in back-pay royalties.
According to www.classaction.org., in August 2012, a Kansas judge approved a US$54 million settlement with landowners who claimed they were underpaid royalties when ExxonMobil made deductions for expenses that occurred downstream of their wells.
The settlement also ended a lawsuit filed in Kansas state court against ExxonMobil over royalties dating back to 2000.
Given ExxonMobil’s history in the foregoing cases, critics believe that it would not be impractical for Guyanese to question whether the state is preparing the legal framework to deal with the worst to come with the oil and gas superpower.
