The Guyana government has sued the Indian firm, Surendra Engineering, for almost GUY$1 billion in damages for alleged breach of contract and alleged corrupt or fraudulent transaction in connection with the failed construction of the US$18 million Specialty Hospital.
The writ claiming an estimated GUY$991,371,520 was filed on October 16 and the company has been given until December 3 to make an appearance.
In High Court documents seen by Demerara Waves Online News, Attorney General and Minister of Legal Affairs, Anil Nandlall states that Surendra Engineering has failed to design and complete the architectural drawings and building plans for which they received payment.
Nandlall adds that the Mumbai-headquartered company failed to mobilize, establish the site at Liliendaal, East Coast Demerara; supply civil engineering materials and other works listed in the contract.
In its Statement of Claim, the government further adds that Surendra Engineering failed to properly account for the advance payment of US$4,285,440 by not submitting payment receipts.
Government also claims that the defendant failed to renew/ provide the Advance Payment Guarantee and the Performance Bond for the period March 12, 2014 to present. But on July 24, 2012 submitted drafts of Advance Payment Guarantee, Performance Security and Insurance from Worldwide Bankers Re Company Limited, 22-24 St. Vincent Street, Port-of-Spain, Trinidad and Tobago for government’s approval.
The particulars of the alleged corrupt or fraudulent practices are that Surendra Engineering attempted to obtain an Advance Payment Guarantee and Performance Bond with a company not registered as an insurance company under the Insurance Act, Cap 84:01 of Trinidad and Tobago, named ‘Worldwide Bankers Re Limited purportedly located in Trinidad and Tobago;
According to the Attorney General’s Statement of Claim on behalf of the government, Surendra Engineering submitted a document dated 13th January, 2012 purportedly emanating from Central Bank of Trinidad and Tobago and purporting to inform that Worldwide Bankers Re Limited had more than five (5) years in the reinsurance and coinsurance business and is authorised to conduct those operations since 1998. However, the Guyana government was informed by the Central Bank of Trinidad & Tobago by letter dated the 2nd September, 2014, was not generated by Central Bank of Trinidad and Tobago;
“The Defendants submitted fabricated, unsigned and sometimes inflated invoices with no evidence of actual payments made or to support the expenditure claimed,” added the Attorney General.
Listing the claim for damages, the Guyana government wants the High Court to award GUY$100 million for breach of contract and special damages amounting to US$4,285,440 (GUY$891,371,520).
A breakdown for special damages shows that US$3,636,000 or 20 percent Advance Payment was paid on December 27, 2012 another US$505,440 for design services and US$144,000 for site mobilization on November 18, 2013.
“The Defendant failed to perform their obligations under the terms of the Contract and to account for the advance payment of US $4,285,440 that is, submit payment receipts. Instead the Defendant submitted fabricated, unsigned and sometimes inflated invoices with no evidence of actual payments made or to support the expenditure claimed,” states the Statement of Claim.
Government also wants the Commercial Division of the High Court to award interest, costs and further or other orders.
Surendra Engineering was contracted on September 14, 2012 to design and build the Specialty Hospital with a US$18 million line of credit from India’s EXIM BANK.