Judges will require training to handle oil and gas cases – Harmon

Jul 21, 2017 News, http://www.kaieteurnewsonline....nd-gas-cases-harmon/

By Kiana Wilburg
Minister of State, Joseph Harmon acknowledged yesterday that local judges will require capacity-building exercises so that they can be able to effectively handle the legal issues that may arise from a complex oil and gas industry which Guyana is currently preparing to be a part of.

Harmon made this statement at his post-Cabinet press briefing which was held at the Ministry of the Presidency. There, he was asked by Kaieteur News to comment on the preparedness of the judiciary for the looming oil sector.

The Cabinet Secretary said he believes that the judiciary is on an upward trajectory. The Minister of State reminded that the Government recently appointed a new Chancellor, Chief Justice, and on Wednesday, another Appellate Judge and four Puisne Judges.

“But insofar as the capacity of the judges to deal with these issues, it is something that requires training. And no country, as far as I am aware, really becomes proficient in dealing with these matters, unless there is some period of training in specific areas of the law,” expressed Harmon.

He continued, “Our judges are trained in the law, but there are some specific issues which would arise from this area of development and clearly our judges, I am sure, would adjust to it.”

Harmon added, “The judicial officers are also benefitting from training locally and abroad…And more of this is taking place.”

The Minister insisted that preparation is taking place.

A similar train of thought was expressed when Opposition Leader, Bharrat Jagdeo was faced with the same question at his press conference on Wednesday.

The former President asserted that somehow, Guyana has to build capacity when it comes to the judiciary. He expressed hope that sooner rather than later, specialized courts would be established to deal with such issues. He said that a commercial court for example could be put in place to deal specifically with oil and gas cases in a swift matter. He too shared the opinion that training would be needed for some of Guyana’s judges.

Several legal experts have also opined that Guyana’s judicial system is currently not prepared for the complex legal issues that may arise from the looming multibillion-dollar oil and gas sector.

Attorney-at-Law, Sanjeev 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 believes that major companies which come into Guyana are going to be distrustful of the judicial system, given the perception of how long cases take to be heard, how easily records get lost, personalities involved, among other discouraging observations.

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,” Datadin asserted.

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 to 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.

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 aforementioned 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 giant.