Contractor slapped with multi-million dollar lawsuit over Leguan Stelling failures

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The Attorney General Chambers has instituted legal proceedings against S. Maraj Contracting Services for failure to meet contractual obligations in relation to the $413M rehabilitation of the Leguan Stelling project.

The contract was terminated in February following a special audit which had found that the company is “incapable, unable, and does not posses the wherewithal” to successfully execute the project.

The contract was awarded in September 2018 and it was expected to be completed in June 2019.

See full Statement of Claim filed:

Mr. Mohabir Anil Nandlall SC, MP
Attorney General of Guyana and
Mr. Nigel Ovid Hawke, Solicitor General
Attorneys-at-Law for the Claimant
Firm’s name: Attorney General’s Chambers
Address: 95 Carmichael Street,
North Cummingsburg, Georgetown
Tel. No.: 225-3607
Email: [email protected]

IN THE HIGH COURT OF THE SUPREME COURT OF JUDICATURE OF GUYANA

CIVIL JURISDICTION

2021 – HC – DEM – CIV – SOC –

BETWEEN:
THE   ATTORNEY   GENERAL OF GUYANA
Claimant
–        and –

1.     S. MARAJ  CONTRACTING   SERVICES
2.     ASSURIA GENERAL (GY) INC,  a  company   duly   incorporated under   the   Companies    Act,  Laws  of  Guyana  situate  at  Lot  78  Church Street,  South   Cummingsburg,  Georgetown  Guyana.

Defendants

INFORMATION FOR COURT USE
1.     This proceeding is commenced as a:
[ x] Statement of Claim
[] Fixed Date Application

2.     This proceeding falls under the High Court’s
[ ] Appellate Jurisdiction
[ ] Admiralty Jurisdiction
[ ] Commercial Jurisdiction
[ ] Criminal Jurisdiction
[ ] Family Jurisdiction
[x] Regular Jurisdiction
(must check one of these boxes and, except where proceeding is under the regular jurisdiction of the Court, must specify the applicable jurisdiction in the General Heading (Form 4A).

3.     The proceeding is an
[ ] Admiralty Proceeding in personam
[ ] Admiralty Proceeding in rem
[ ] Probate Proceeding
[ ] Proceeding Judicial Review
[ ] Proceeding relief under constitution
[ ] Proceeding for Administrative Law
[ ] Proceeding for Administration
[x ] Other Proceeding
(must check one of these boxes and, except where the proceeding relates to the last option so on the General Heading (Form 4A).

4.     I certify that the above information is correct, to the best of my knowledge.

Dated this            March, 2021.

________________________________
Mr. Mohabir Anil Nandlall SC, MP
Attorney  General and Minister of
Legal  Affairs
Attorney- at- law for the Claimant.

Mr. Mohabir Anil Nandlall SC, MP
Attorney General of Guyana and
Mr. Nigel Ovid Hawke, Solicitor General
Attorneys-at-Law for the Claimant
Firm’s name: Attorney General’s Chambers
Address: 95 Carmichael Street,
North Cummingsburg, Georgetown
Tel. No.: 225-3607
Email: [email protected]

IN THE HIGH COURT OF THE SUPREME COURT OF JUDICATURE OF GUYANA

CIVIL JURISDICTION

2021 – HC – DEM – CIV – SOC –

BETWEEN:

THE   ATTORNEY   GENERAL OF GUYANA
Claimant
–        and –

3.     S. MARAJ  CONTRACTING   SERVICES
4.     ASSURIA GENERAL (GY) INC,  a  company   duly   incorporated under   the   Companies    Act,  Laws  of  Guyana  situate  at  Lot  78  Church Street,  South   Cummingsburg,  Georgetown  Guyana.

Defendants

STATEMENT OF CLAIM
TO THE DEFENDANTS

A LEGAL PROCEEDING HAS BEEN COMMENCED AGAINST YOU by the Claimant. The claim made against you is set out in the following pages.

IF YOU WISH TO DEFEND THIS PROCEEDING, you or an Attorney-at-Law acting for you must prepare a Defence in Form 10A prescribed by the Civil Procedure Rules 2016, serve it on the Claimant, and file it, with proof of service at a Registry, WITHIN TWENTY-EIGHT DAYS after this Statement of Claim is served on you.

IF YOU FAIL TO DEFEND THIS PROCEEDING, JUDGMENT MAY BE GIVEN AGAINST YOU IN YOUR ABSENCE AND WITHOUT FURTHER NOTICE TO YOU. IF YOU WISH TO DEFEND THIS PROCEEDING BUT ARE UNABLE TO PAY LEGAL FEES, LEGAL AID MAY BE AVAILABLE TO YOU BY CONTACTING A LOCAL LEGAL AID OFFICE.

THIS STATEMENT OF CLAIM has no validity if it is not served within six months of the date below unless it is accompanied by an order extending that time.

Date_______________________                 ________________________
Signature of Registry
Issued by:
Address of Registry where issued:
Supreme Court Registry,
South Road Georgetown, Demerara.

TO:     S. MARAJ CONTRACTING  SERVICES,  Lot  25  Success  Leguan,  Essequibo Island,  Region  No.  3  Guyana.

TO:     ASSURIA GENERAL (GY) INC, a  company   duly   incorporated under   the   Companies    Act,  Laws   of    Guyana with  its   registered   office   situate   at  Lot  78 Church  Street,  South   Cummingsburg,  Georgetown  Guyana.

CLAIM
A.          The Claimant claims from the Defendant, the following:-

(i)              General damages in excess of one hundred million dollars ($100,000,000.00) against the First named Defendant for breach of the   Contract dated 18th September, 2018   for   the  Rehabilitation  of  the  Leguan  Ferry  Stelling,  Essequibo  Islands,  Region  #  three  (3)   Guyana;

(ii)            The sum of 41,325,926.00 (forty  one  million, three  hundred  and  twenty   five   thousand, nine  hundred  and  twenty   six) Guyana dollars as liquidated damages from the First named Defendant pursuant to the provisions of Contract dated Contract dated 18th  September, 2018;

(iii)          The sum of  $ 41,325,926.00 ( forty one   million,  three  hundred  and  twenty  five  thousand,  nine   hundred  and  twenty  six)  Guyana   dollars as  the  sum  due, owing and payable by the First named Defendant  under Performance Bond issued by the Second named Defendant for Agreement dated 18th  September, 2018   for the  Rehabilitation  of  the  Leguan  Ferry  Stelling,  Essequibo  Islands,  Region  #  three  (3)   Guyana;

(iv)           The sum of  $ 81,398,375 .00 ( eighty  one  million,  three  hundred  and  ninety  eight  thousand,  three   hundred  and  seventy   five )  Guyana   dollars as  the  sum  due, owing and payable by the First named Defendant  under  the   Mobilization  Bond issued by the Second named Defendant for Agreement dated 18th  September, 2018   for the  Rehabilitation  of  the  Leguan  Ferry  Stelling,  Essequibo  Islands,  Region  #  three  (3)   Guyana;

(v)             An Order for Restitution from the First named Defendant in the sum of $ 81,398,375 .00 ( eighty  one  million,  three  hundred  and  ninety  eight  thousand,  three   hundred  and  seventy   five )  Guyana;

(vi)           Aggravated damages in the sum of one hundred million dollars ($100,000,000) for the First named Defendant’s breach of the Agreement dated 18th September, 2018 for the  Rehabilitation  of  the  Leguan  Ferry  Stelling,  Essequibo  Islands,  Region  #  three  (3)   Guyana;

(vii)         Alternatively, an Order of Restitution against the Second named Defendant for all monies owing on the Advance Guarantee and Performance Bond to the Government of Guyana;

(viii)       Interest in accordance with Section 12 of the Law Reform Miscellaneous Act, Chapter 6:02, Laws of Guyana

(ix)           Such further or other Orders as the Court deems just and reasonable;

(x)              Costs.

B.          The facts relied upon are as follows:-
1.        The Claimant is and    was   at   all   material times   the   Legal representative of the    Government   of     Guyana pursuant    to section   112   of   the    Constitution   of    Guyana   and     statutory   representative of    the   State   in all   civil proceedings   by or   against   the   State.
2.        The First   Named   Defendant  is  and    was  at   all   material   times  a  business    registered  and under   Business   Names   Act ,  Laws   of    Guyana  with its registered office  situate Lot  25  Success  Leguan,  Essequibo Island,  Region  No.  3  Guyana.

3.        The First   Named Defendant   is a registered   Business  with   one   of its   primary business    being   Civil,   Industrial   and     Construction   Engineering with    the    jurisdiction   of    Guyana.
4.        The  Second  Named  Defendant  is  and    was  at   all   material   times  a  company  duly  registered  and    existing  under    the   Companies   Act , Laws of Guyana with its registered office  situate   at  Lot  78 Church  Street,  South   Cummingsburg,  Georgetown  Guyana.

5.        The   Second   Named    Defendant is  a  limited  liability    company  with   its   primary  business  as  general insurance,  fire   and   life  Insurance   with    the   jurisdiction   of    Guyana and  with   whom the   First   Named   Defendant   executed   a  performance  bond and   Mobilization  bond  for  the  Rehabilitation  of  the  Leguan  Ferry  Stelling,  Essequibo  Islands,  Region  #  three  (3)   Guyana.

6.        The Government  of   Guyana  through  the  Transport  and   Harbours   Department  (T&HD)  executed   a  written   agreement  the   First  named    Defendant   on  the   20th  September,  2018  for    the   rehabilitation  of   the   Leguan  Ferry   Stelling,  T &HD.  The    contract   was   executed  for  the  sum  of  $413,259, 260.00 ( four  hundred  and   thirteen  million, two  hundred  and  fifty nine  thousand, two  hundred  and  sixty  )   Guyana   dollars and was   supposed   to  be  completed  on  or  before  18th  June,2019.
7.        The    First named    Defendant   submitted   an   agreed   schedule   of   works   to  the   project  Consultant  but   failed execute    the    works    in  accordance  with    the   agreed   works   schedule  and   has  caused    the   project   to  be   inordinately   delayed.
8.        The  Rehabilitation  of  the  Leguan  Ferry  Stelling  was    supervised    at  all   material   times    by the project  consultant  Quintech  Engineering  Services.
9.        The  First  Named    Defendant  would    have   submitted a  work progamme   to  the    project  consultant   with   the    schedule  works   for  the  duration   and  completion   of   the  Rehabilitation  of  the  Leguan  Ferry  Stelling.
10.     As  a  consequence of  the  failure    of    the   First  Named  Defendant to  comply   with  programme  of  works     submitted     to  the  project  manager,     an  assessment    was     done  by  the  project   consultant, Quintech Engineering  Services    and    it  was    discovered    that   the First   Named  Defendant    had   only    completed  minimal   works   relating    to  the  the  Rehabilitation  of  the  Leguan  Ferry  Stelling  and   works    have  been  delayed     approximately  two (2)  years.
11.     As   a  consequence,    the    Government  of  Guyana   caused    the    contract  to  be  terminated  on  the   22nd   February,  2021   on   grounds    of     failure   to  comply   with   the  schedule   of  works   and    the   inordinate    delay   in  carry  out   works   on    the   part   of   the    First  Named Defendant  which  amounted    to  fundamental   breach   of    the   Agreement.
12.     The   termination   letter   was   as    follows:
22nd February, 2021
Mr. Sattrohan Maraj
S.Maraj Contracting Services
Lot 25 Success,
Leguan, Essequibo
Guyana.

Dear Sir,

Re:   Termination   of    Contract   for   the  Rehabilitation  of   Leguan  Ferry
Stelling- Transport  and  Harbours  Department( T& HD)
I act   on behalf of the   Government  of  Guyana.
The Government  of   Guyana  through  the  Transport  and   Harbours   Department  (T&HD)  executed   a  written   agreement  with  your  company  on  the   20th  September,  2018  for    the   rehabilitation  of   the   Leguan  Ferry   Stelling,  T &HD  in accordance   with the terms specified in the said contract.
The    contract   was   executed  for  the  sum  of  $413,259, 260.00 ( four  hundred  and   thirteen  million, two  hundred  and  fifty nine  thousand, two  hundred  and  sixty  )   Guyana   dollars and was   supposed   to  be  completed  on  or  before  18th  June,2019.
The T&HD has granted    several extensions    of    the    contract and   notwithstanding    those   extensions,   the project    has    been   delayed    for   approximately   twenty  (20)  months.
Thus far, your    company    has    only    completed   a minimal   amount   of   the   schedule   of   works. As   a consequence, your    company    has   committed   a   fundamental   breach   of   the terms of   the   contract  and   as  a  result   thereof   the  Government  of   Government    hereby   exercises    its  right   to  terminate  the     contract   with  immediate   effect.
The   grounds for   termination are   as follows:
(a)      Breach   of   Clause  40.2 (a)  for   failing   to  comply   with   the   schedule   of  works;
(b)      Breach  of  Clause  40.2 (g)  read  along  with   the   special   conditions   of   the  contract   for    inordinate   delay   in   the  completion  of  works   under   the  contract.
The   Government   of    Guyana   will enforce     provisions  of   the   contract   regarding   the  following:
(a)      The   Performance  Bond   of   $43,325,926.00;
(b)      The  mobilization  Bond  of  $ 81,398,375.00;
(c)      The    ten (10%)  of  the  contract   sum   as   liquidated   damages; and
(d)      The   value   of  the   works   not   performed.

In  addition thereto,  the   Government of   Guyana reserves  its  right  institute  legal  proceedings against   your   company for   compensation  for   breach  of  contract  and   unjust   enrichment.

Please arrange   to have   the  site   cleared immediately.

Please be   guided accordingly

Yours   Faithfully

…………………………..
Mr. Mohabir  Anil  Nandlall, MP,  SC
Attorney   General   and    Minister   of   Legal   Affairs

13.     The   grounds for   termination are   as follows :Breach   of   Clause  40.2 (a)  for   failing   to  comply   with   the   schedule   of  works and Breach  of  Clause