PPP/C gov’t should ensure compulsory acquisition of Ocean View Hotel – Basil Williams
Former Attorney General Basil Williams today said that the PPP/C government should ensure that the compulsory acquisition of the Ocean View Hotel – the site of the controversial infectious diseases hospital – is completed.
In a statement, he detailed the legal circumstances surrounding the hotel and its indebtedness.
A statement from Basil Williams follows:
The APNU+AFC Government had submitted the requisite authority under the hand of the relevant minister, authorizing a sworn land surveyor of the Guyana Lands and Survey Commission to deposit the documents contemplated under section 9 (1) of the Acquisition of Lands for Public Purposes Act, Chapter 62:05, with the exception of the Certificate of Compensation to the effect that the National Assembly has voted the sum necessary for compensation for the acquisition of the Ocean View Hotel.
The Parliament having been dissolved for the holding of the General and Regional Elections, the said Certificate of Compensation could not have been deposited; instead a letter of undertaking under the hand of the Minister of Finance stated that when the National Assembly is convened the appraised sum of the Chief Valuation Officer will be voted on.
The Chief Valuation Officer had appraised the said hotel in the sum of $1,144,100,000.00 (one billion one hundred and forty -four million, one hundred thousand dollars) cost rounded approach and for sale value would be the sum of $850,075,000.00 (eight hundred fifty million seventy five thousand dollars)
Now this compulsory acquisition has its genesis in the search by the Ministry of Public Health for quarantine facilities due to the Covid-19 pandemic.
There were consultations between the Ministry of Public Health and the Pan American Health Organization and World Health Organization (PAHO/WHO) which determined that the capacity of the current medical facilities was wholly inadequate to deal with the Covid-19 pandemic.
The Ministry of Public Health immediately embarked on a search for some time for a suitable place and found that the Ocean View Hotel Limited was the most suitable given the circumstances.
A presentation was made to Cabinet based on advice proffered by Mr. Andrew M. F. Pollard, SC of the Hughes, Fields and Stoby Law Firm which caused Cabinet to consider whether to lease or own the property in question. It was determined by Cabinet that the best option would be to own the property through compulsory acquisition.
Cabinet had found during its deliberations that the Ocean View Hotel Limited is presently indebted to the Guyana National Co-operative Bank (GNCB) in sums in excess of $1,069,425,886 (the debt). The debt was incurred pursuant to several loan transactions, firstly with the Guyana Co-operative Agricultural and Industrial Development Bank (GAIBANK), and then with its successor in title GNCB.
The debt was secured by several Debentures, namely: –
(i) A First Debenture Registered No. 1134/1993 in favour of GAIBANK as a floating charge on the assets of the company to secure $143,563,500;
(ii) A Second Debenture Registered No. 1182/1993 in favour of GAIBANK as a (fixed and) floating charge on the assets of the company to secure $55,436,500; and
(iii) A Third Debenture Registered No. 1305/1995 in favour of GNCB as a fixed and floating charge on the assets of the company to secure $20,000,000.
The Ocean View Hotel defaulted on payment of the sums due.
By an instrument dated the 29th day of May, 2009, GNCB appointed a Receiver of the Ocean View Hotel’s undertaking, Mr. Courtney Perry, with a view to taking over the management of the Hotel and a sale of it to recover the debt. Mr. Perry remains the Receiver up to the present time and is still active in this Receivership.
Several civil proceedings were instituted in the High Court against GNCB and the Receiver by Wilfred Rambaran, the sole shareholder and a Director of the Ocean View Hotel Limited. On the 10th day of March, 2016, the Honourable Mr. Justice Rishi Persaud gave judgment in the High Court in Wilfred Rambaran & Ocean View Hotel Limited v. GNCB & Courtney Perry (Receiver); Civil Action No. 899-CD of 2009 (Demerara) in favour of the Receiver. The Court ruled that the appointment of the Receiver was lawful, proper and effective. It was further ordered by the Court that the Receiver recover the sum of $223,800,000 against the Ocean View Hotel, together with interest thereon at 17.5% (seventeen decimal five percentum) per annum from the said 10th day of March, 2016, until fully paid. Wilfred Rambaran has appealed to the Court of Appeal, but the appeal has not yet been heard. There was no stay of execution nor any cross-appeal by GNCB.
In light of the foregoing, and the ongoing Covid-19 pandemic reflecting increased deaths and a surge in positive cases it is incumbent that the PPP/C Government secures the acquisition of the Ocean View Hotel Limited in furtherance of combatting the Covid-19 pandemic.
Yours faithfully,
Basil Williams SC THE DUNCE
Former Attorney General and Minister of Legal Affairs
