High Court strikes out SARA’S attempt to recover $224M from GBTI

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The High Court on Friday struck out a Statement of Claim made by the State Asset Recovery Agency (SARA) to recover $224 million from the Guyana Bank for Trade and Industry (GBTI).

SARA had claimed that GBTI purchased its Lot 109 Young Street, Kingston land, on which it built its Corporate Office, below value for $201 million.

“GBTI had submitted only the 4th highest of 14 bids in a tendering process, but was awarded the right to purchase the property that is now its headquarters for GY$224M less than the most recent valuation of the property at that time.

“Cabinet had determined that the valuation would be the basis of the floor price in the event of a sale of that property,” SARA had claimed.

The acquisition of the parcel of land, with the approval of the then President and Minister of Finance of Guyana through a public tendering process and conducted by the Privatisation Unit was contrary to the Public Corporations Act and therefore unlawful, SARA claimed.

The Agency claim that the estimated value of the land as at 3rd June, 2005 was $ 425 million and the acceptance of the Bank’s bid was contrary to the Privatization Policy prepared by the Government in 1993.

SARA also claimed that GBTI would have known of the estimated value of the land and would have also been aware of the allegations of unlawful conduct in relation to the award of tender and therefore knowingly benefited from the illegality.

On the 13th September, 2019 the bank filed an application to strike out the claim.

GBTI argued on several fronts, including that with no lawfully appointed Director of SARA, no corporation sole was constituted, and that the State Assets Recovery Act 2017 has no provision stating it has retroactive capacity. Further, it claimed there was no floor price indicated, no failure in bidding and no offence or unlawful conduct was created amongst other salient principles of law.

On Friday last, Justice Holder granted the bank’s application that the Statement of Claim by SARA be struck out, on the basis that the claim failed to disclose any reasonable cause of action.

The court agreed with the submissions of the bank, namely that SARA was not a body corporate and could not bring the proceedings in its own name and any such statement could only have been brought by Director or Deputy Director and no such person was ever appointed in accordance with the Act.

GBTI was awarded cost to the sum of $200,000.

The Bank was represented by Senior Counsel Edward Luckhoo, Stephen Fraser, Rafiq Khan and Ralph Ramkarran.

 

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