DP wants risk assessment by Central Bank – Harbor’s legal team calls Zebec N.V.’s $100M claim “frivolous”POSTED: 08/25/14 11:13 PM
St. Maarten – The Harbor Group of Companies says that the $100 million claim from Zebec NV against it is “wholly without merit” but the Democratic Party said in a press release that it is “seriously concerned” about the matter. Zebec claims damages from the harbor over the Harbor Village project that it was going to develop. The project stalled, according to Zebec, because Harbor CEO Mark Mingo kept throwing up obstacles.
The Harbor stated in a press release this weekend that it would “vigorously” defend itself against the claim in court. “The harbor has complete confidence in the positive outcome of these proceedings.”
The Democratic Party on the other hand is not so sure. “The risk associated with this claim can pose a serious threat to the survivability of this group of companies,” the DP stated. “When a company like the harbor has claims against it, its bond holders that include the Central Bank of Curacao and St. Maarten should be utterly concerned.”
The harbor regrets “that Zebec has chosen to abandon the project after the harbor invested significant time and funds for preparing the development land for the project,” the harbor’s press release states.
The harbor will “seek alternative opportunities” for the development and it will also “investigate options to recover damages from Zebec.”
DP-faction leader Roy Marlin says that the Central Bank ought to assess the risk of the Zebec-claim and its meaning for the Harbor Group of Companies. “This claim could also have an effect on external financiers such as RCCL and Carnival Cruise Lines Corporation. How could the CEO of the harbor, knowing that the company entered into a legally binding development contract with a third party, not uphold the rights of this third party?” Marlin wonders.
Marlin refers in the press release to a piece of land the harbor purchased between Chesterfields and Bobby’s Marina (for a reported $5 million – ed.). “There is a sign on the land stating that the owners of the land are looking for developers; anyone interested can contact the owner. This happens to be the Harbor Group of Companies,” Marlin stated.
The DP-faction leader wonders why the harbor would purchase a property without having a vision for its development, “while they have created a development vision together with the owners of Zebec. This does not sound or smell right.”
The Harbor Group of Companies has a different opinion. The company’s legal team claims that the harbor “never failed to honor signed agreements” and that it “repeatedly gave Zebec the opportunity to proceed with the project.”
The harbor’s legal team furthermore claims that Zebec did not want to proceed with the project “unless previously agreed conditions would be altered in its favor.” When the harbor refused to adjust the conditions, “Zebec chose to abandon the project and issue a frivolous lawsuit in an obvious attempt to shift the blame of the project’s collapse towards the harbor.”
DP-faction leader Roy Marlin wants parties to return to the negotiation table. He furthermore referred to statements by party-leader Sarah Wescot-Williams who spoke out publicly “against actions by government-owned companies that could threaten the financial position of the government.”
Wescot-Williams made those remarks in the context of the conflict between St. Maarten Postal Services and its former managing Director Denicio Richardson. The latter won a claim against Postal Services that the government has paid in the meantime. Wescot-Williams said that government still appealed the ruling to get clarity about its responsibility towards its government-owned companies.