NOT ONLY has the Court of Appeal upheld a judge's ruling invalidating the sale of insurance giant Clico’s energy assets to Proman Holdings (Barbados), it has also made a finding of fraud in relation to the transaction.
The sale of Clico's energy crown jewels took place three days after Government bailed out the CL Financial conglomerate in early 2009.
The ruling came on Monday by Justices of Appeal Alice Yorke-Soo Hon, Gregory Smith and Vasheist Kokaram. In upholding Justice Devindra Rampersad's 2021 ruling, the Appeal Court judge also made a finding of fraud which Rampersad had declined to make.
The judges rejected the appeal of Proman Holdings (Barbados) Ltd and Process Energy (Trinidad) Ltd (PETL), formerly Clico Energy, upholding Rampersad’s findings except on the issue of fraud.
Commenting on the court’s decision, a Proman spokesman told Newsday, "We are disappointed by the Court of Appeal’s judgment, which runs contrary to the trial judge’s determination in relation to Proman’s role in the transaction.
"We have a strong case on appeal, which we will pursue before the Privy Council and are confident in our prospects of success."
The spokesman said Proman has been committed to Trinidad and Tobago for over 35 five years, "and we are proud of our track record as the largest investor and employer in the Point Lisas Industrial Estate."
At the appeal, heard in January, attorneys for CLF and Clico insisted the sale transaction between Proman and CLF jefe Lawrence Duprey for the sale of Clico Energy’s shares could not be ratified.
They also asked the court to make a finding of fraud on Proman’s part since it would have had a bearing on recovering efforts, if the CLF and Clico lawyers were successful at the appeal, especially since Proman had asserted it could not pay dividends owed to CLF and Clico.
The worth of Monday’s judgment for CLF exceeds $2 billion, which represents the sale transaction and dividends on shares.
At the time of Rampersad’s judgment in 2021, CLF and Clico claimed they would have received US$169 million in dividends had their stakes in PETL not been sold.
Proman has signalled its intention to appeal to the Privy Council.
The company’s attorneys asked for a stay, pending that appeal. One was partially granted since, according to Smith, both sides have indicated they cannot pay the judgment sum at the end of litigation – CLF because it is insolvent and Proman has said it could not pay.
As part of the conditions of the stay, CLF is entitled to appoint four directors to PETL while Proman will be allowed to appoint two, with immediate effect, while the sums representing the dividends already received, and future sums, are to be paid into the court pending the outcome of any further appeal.
At the time of the deal, CLF controlled 34 per cent, Clico another 17 per cent, with the remaining shares in PETL, being held by Proman.
[caption id="attachment_1028205" align="alignnone" width="683"] Fyard Hosein, SC, who represented Clico and CLF. FILE PHOTO - FILE PHOTO[/caption]
