$717.8M lawsuit filed against BK Int’l, Nafico over Yarrowkabra Secondary School project

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Attorney General Anil Nandlall

The Attorney General Chambers has instituted legal proceedings against BK International Inc and the North American Fire and General Insurance Company (Nafico) for breach of contract in relation to the construction of the Yarrowkabra Secondary School.

On December 31, 2019, the then APNU/AFC coalition government entered into a contract with BK International Inc to construct a Secondary School at Yarrowkabra, Linden-Soesdyke Highway to the tune of $826,757,737.

The school, the Ministry of Education had said, is intended to benefit 600 children in Yarrowkabra and neighbouring communities along the Linden Highway. The state-of-the-art school was scheduled to be completed in March 2021.

On Tuesday, Attorney General Anil Nandlall instituted legal proceeding against the contractor and its insurance company.

In the court documents released by the AG Chambers, the State is claiming a total of $717,887,877 in damages.

A breakdown of the claims indicates that the State is claiming $100 million in general damages for the breach of contract; $82,675,774 as liquidated damages pursuant to the provisions of the contract; $82,675,774 payable by BK under performance bonds issued by Nafico for the contract agreement; $165,351,547 for advance payments; a $137,184,782 order for restitution for works already paid for but not executed; $50 million for trespassing; and $100 million for breach of contract.

Additionally, the State is asking that the Court issue an Order of Restitution against Nafico for all monies owing on the advance guarantee and performance bonds to the Government of Guyana. They are also seeking interest in accordance with Section 12 of the Law Reform Miscellaneous Act, Chapter 6:02 of the Laws of Guyana in addition to legal costs incurred for taking the defendants to court.

As of November 2020, only 5% of the school was completed which translated to the school not being completed in accordance with the contractual obligation.

On November 1, 2020, Nandlall wrote BK International Inc informing the entity that the contract was terminated with immediate effect. He noted that the company had committed a fundamental breach of the terms of the contract and as a result, the Government of Guyana exercised its right to terminate the contract.

In the said letter, the contractor was advised to remove all machinery and equipment from the site.

On November 10, 2020, the consultancy firm visited the site and observed that the company was still progressing with works despite the contract being terminated.

In a letter dated November 11, 2020, the consultancy firm wrote the Managing Director of BK International Inc, Brian Tiwarie, informing him that pursuant to Clause 40.5 [Termination] “the contractor is to stop the works immediately, make the site safe and secure and leave the site as soon as reasonably possible.”

In that letter, the consultants instructed the contractor to stop works immediately and advised that any work done or materials ordered beyond the date of termination, November 1, 2020, is done at the contractor’s own risk.

The Ministry added that on November 19, 2020, Permanent Secretary of the Education Ministry, Alfred King wrote BK International Inc instructing the company to bring all work to a halt with immediate effect and vacate the project site within twenty-four hours.

The Ministry has since installed its own security after taking possession of the site with the help of the enforcement arm of the State.