Contracting firm moves closer to EFCL payment

A High Court ruling has removed at least one hurdle for a local contracting firm which is seeking payment from the Education Facilities Company Limited (EFCL) for work it did on the School for the Blind in Santa Cruz in 2014.

In a written decision, Justice Eleanor Donaldson-Honeywell dismissed an application by EFCL to set aside the judgement for $38.6 million granted to Contech Ltd, and another application to stay the proceedings so that the matter can go to arbitration.

She also dismissed a similar application by the Attorney General to strike out Contech’s claim against it, but said in light of the seriousness of the issues raised the AG will be permitted time to file a defence.

In her ruling, Donaldson-Honeywell said it was not mandatory for the court to stay proceedings for arbitration, adding that the court had a discretion to do so.

She also held, the court had to be satisfied that there was a dispute to be referred to arbitration. EFCL had argued that the mere claim filed by Contech was a “clear indication” there was a dispute.

The judge, however, said EFCL, in seeking to set aside the judgment in default, did not address the claim or put in a defence. She also pointed out that EFCL, in correspondence to Contech on January 22, 2016, admitted to owing the contractor $38.6 million. Donaldson-Honeywell said there were main flaws in EFCL’s arguments, adding that it should have raised as a jurisdictional point that under the contract between the two parties, it was mandatory for the court to defer to arbitration.

Contech had been granted judgment in default on October 9 in which it was seeking payment of outstanding amounts on two construction contracts entered into with EFCL on June 3 and 16, 2014.

Representing Contech were Prakash Deonarine, Vijay Deonarine and Krystal Kawal while Kristal Piper appeared for the EFCL and Neal Byam and Avaria Niles for the AG.

This was one of several cases in which the State sought to set aside judgment entered in favour of contractors against the EFCL for failing to file defences.

At a joint select committee of Parliament hearing in November, EFCL said it had been sued for $1.2 billion by 20 contractors.