A report in the Trinidad & Tobago media claims that the Rowley Administration is unmoved by Prime Minister Gaston Browne’s threats to sue that country for failing to pay a US$100 million debt by British American Insurance Company limited (BAICO) and Colonial Life Insurance Company Limited (CLICO).
The T&T-based conglomerate went into insolvency in 2009, reportedly owing policy-holders in Antigua and Barbuda nearly $300 million.
Last Saturday, July 23, Browne said his Administration might have
to sue that Government, since it has paid only about US$40 million of its agreed settlement of the companies’ obligations.
According to an article in the TT GUARDIAN, government officials there have declined to comment officially; but the media entity has learnt that the government has no record of any correspondence being sent to them, as was stated by PM Browne.
Browne said, on Saturday, that his Administration has written to the Rowley government twice, but it has not been treated with the type of respect that is typical among countries and colleagues. And he added that Antigua and Barbuda will be writing to the Rowley administration again, for a third time
However, sources allegedly have confirmed to the GUARDIAN that the T&T Government is ready for any possible lawsuit – for which there is no legal foundation, lawyers reportedly have concluded.
The report says the Government of Antigua and Barbuda would first have to overcome a June 28, 2016 Privy Council judgment in the case of The United Policyholders Group and others (the Appellants) vs The Attorney General of Trinidad and Tobago.
“The ruling basically states [that] a government can override a previous administration’s promise based on the current economic circumstances,” the media outlet says.
The CLICO policyholders had argued, then, that the government had given assurances of a company bailout, which created a “legitimate expectation” of support. However, the government did not agree to the terms when it announced a new bailout plan in 2010/2011.
The Privy Council is reported to have ruled that the Trinidad & Tobago government was entitled to change its mind for good reasons based on macro-economic and macro-political issues.
Observers say that PM Browne clearly was aware of this proviso, since he said the fortunes of Trinidad & Tobago should have improved now as a result of the increase in fuel prices. Accordingly, he was hoping the government there would put some system in place to cover the rest of the insurance companies’ liabilities.
At the time, local bankers said the Prime Minister’s threat of a lawsuit was simply a diversion, intended to draw attention away from the problem facing two local banks.