A HIGH COURT judge has sternly rejected a petition by the Education Facilities Company Ltd (EFCL) to have the company wound up.
On Thursday, Justice Carol Gobin dismissed EFCL’s petition which was objected to by dozens of contractors who said they were owed millions for unpaid contracts.
She also had some harsh criticisms of the move to wind up the company even as it owed contractors millions.
“I have found that the government deliberately starved EFCL of funding – guaranteeing its demise, even as its corporate purpose could not have been said to be spent or frustrated. There could be no more cogent or conclusive evidence of control.
“This was a chokehold followed by a winding-up petition, the purpose of which was to have the court certify the death.
“It hardly requires further proof.”
In April, last year, the EFCL asked for permission to be wound up. The judge rejected the assertion of insolvency.
In its petition, the EFCL said it had no income, had ceased to carry on the business of project management, was insolvent, and could not meet current debts from cash or other assets.
It asked for its petition to be granted in the public’s interests since it could not repay its debts – estimated at $889,561,246 – to contractors for work done.
The EFCL’s petition outlined the company’s debt woes which totalled $46,737,205.09 at the time the petition was filed.
EFCL has not paid. The sums are in addition to the $800 million owed to contractors.
The company also has 79 unsatisfied judgments/awards, some of which date back to December 2016. The total amount owed on those judgments/awards, up to February 25, was $321,376,009.75.
It also said some $112 million ordered to be paid to contractors was not reflected in invoices in EFCL’s possession and it was also, at the time, defending 30 claims in which $119 million was being demanded.
The debt plus millions of dollars in court judgments against it, led to the State's decision to close down the company, the petition said.
In denying the petition, Gobin said there was no dispute that it is unable to pay its debts.
However, she agreed with the objectors' complaints that allowing the entity to be wound up was an abuse, and will deprive them of their property.
Gobin said the EFCL was different from the ordinary company.”
“A company which is wholly owned by the corporation sole is unlike the ordinary private commercial company.
“Unlike shareholders in private corporations, the corporation sole is accountable to the Parliament and to the citizens of this country, first under the Constitution of our Republic. “
She said to allow a winding up, in the absence of accountability by a corporation sole or state enterprise, was “impermissible.”
“It is hard to resist the conclusion that the petition is presented in an attempt to supplant constitutional, statutory and monitoring policy –with a box-ticking exercise…This is an abuse.”
“...Respect for the separation of powers does not require a court to ignore the attitude of the minister to his responsib
