Contracting companies lose appeal against judge’s refusal to strike out $400 million cartel case

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Contracting companies lose appeal against judge’s refusal to strike out $400 million cartel case

The Court of Appeal has thrown out a case by several contracting companies which sought to have the $400 million cartel claim filed against them by the Estate Management Business Development Company (EMBD) dismissed.

The ruling means the contracting companies must now defend themselves in the High Court.

The contractors, as well as several others named in the claim, including former government minister Dr Roodal Moonilal, have been ordered to file their defences by March 20.

Appellate judges Charmaine Pemberton, Peter Rajkumar, and Vasheist Kokaram on Tuesday dismissed the appeal from the contractors over the refusal of former High Court judge and current Appellate Judge James Aboud to strike out the case against them at a preliminary stage. 

If the contractors do not mount a successful final appeal to the United Kingdom-based Privy Council, the Appeal Court’s ruling means that the case can now go on trial before Justice Frank Seepersad. 

Justice Rajkumar, who delivered the panel’s decision, ruled that EMBD had properly pleaded that it suffered actual pecuniary loss as a result of the alleged unlawful means conspiracy between the contractors and state officials. 

He noted that although EMBD did not quantify the losses it incurred when it filed the case, it could do so when it goes to trial. 

“If or when the report referred to in the respondent’s pleading becomes available the respondent may choose to fine-tune its case by amendment,” he said. 

“This is not the same thing as amending it to complete the cause of action which is now already complete,” he added. 

Justice Rajkumar also rejected claims that EMBD’s pleadings did not properly give particulars linking the contractors to the purported conspiracy so they could mount their defences. 

“Identification of persons named as the directing mind and will of each of the companies is not required in the circumstances in order for the appellants to plead to the allegation of conspiracy, given that the allegedly rigged bids could not have submitted themselves, and the inference of authorisation of the above acts is consistent with an inference of knowledge, approval and intention identified with the corporate appellants themselves rather than any individual rogue employees,” he said. 

Justice Rajkumar also stated that the pleaded case did not need to show the subjective knowledge of the parties. 

“That is because the pleaded actions of the appellants, regardless of the names of any individuals therein, are arguably only consistent with their being the product of conscious, deliberate, and intentional action by a controlling mind or will within each appellant company, designed to dishonestly extract payments from EMBD to which they were not entitled,” he said. 

The lawsuit centres around 12 contracts for the rehabilitation of roads and infrastructure granted to five contractors before the September 2015 general election. 

Contractors TN Ramnauth, Mootilal Ramhit and Sons Contracting Ltd (Ramhit), and Kall Company Ltd (Kallco) initiated the proceedings against the state-owned special purpose company for the almost $200 million balance owed on their respective contracts.

In a press release issued yesterday, Attorney General Reginald Armour, SC, praised the judgement as he highlighted portions. 

“I commend the long, hard battle that has been fought by the management of the EMBD under the chairmanship of Mr Ronnie Mohammed and the work of the company’s legal Team,” he said. 

“These efforts reflect on the Government’s continuing commitment to insist that wrongdoers are brought before our courts to account and that corruption will not pay,” he added. 

The contractors were represented by Ramesh Lawrence Maharaj, SC, Jagdeo Singh, Kiel Taklalsingh, Jamie Amanda, and Karina Singh. 

EMBD was represented by David Phillips, KC, Jason Mootoo, SC, Savitri Sookraj-Beharry and Tamara Toolsie.