The biggest news for the week was the defeat of Keith Mitchell’s New National Party (NNP) government in court Wednesday on The Grenadian by Rex Resorts acquisition lawsuit.
A British company, which owns the hotel, had filed an injunction order in the local court to prevent Government from unilaterally seizing the Rex on grounds that the hotel was not living up to expectations.
As one local commentator observed, the hotel was able to “effortlessly” win the case “outright” and to prevent what appears to many as a hostile takeover of a private sector concern by the State.
A short background to the issue is that the government had served a seven-day notice to the Grenadian by Rex Resorts of its intention to acquire the property under the local Land Acquisition act and quickly proceeded to Gazette the matter as a first notice.
The notice placed in the Gazette raised several eyebrows, as not many persons on the island were aware of any impasse between government and the owners of the hotel.
THE NEW TODAY was told that prior to the second notice appearing in the Gazette, a ridiculous offer was made to the owners by government for the property.
It is our understanding that the paltry sum of EC$9 million was put on the table by government for a property that the investors had ploughed in approximately $45million in the past 25 years of investment.
The battle lines were clearly drawn for a showdown in court, as the Mitchell government is not known for backing down from a fight.
The Rex Grenadian has put together a powerful team including Public Relations personnel to get across its message to anyone with a listening ear on the issue at stake.
The first signs of an intriguing court battle came late Friday, March, 4 when MRI Ltd., the management company of The Grenadian by Rex Resorts, filed an affidavit and injunction request to prevent the government from revoking the company’s 99-year lease and take control of the property through its local legal counsel – Grant, Joseph & Co.
Acting OECS Supreme Court judge, Justice Gerhard H. A. Wallbank presided over the matter that was heard in substance last Friday at the high court on the Carenage.
Justice Wallbank, who operates from a law firm in Anguilla, is retained from time to time by the OECS Court to act as a sitting Judge.
Several local lawyers have described him as one of the better judges whenever he sits on the bench. He is highly regarded among legal practitioners.
In delivering his much anticipated judgment on Wednesday morning in Chambers, the judge made it quite clear that the acquisition notice as published in the Gazette by the NNP government was invalid and unlawful.
It took a brave judge to deliver such a ruling inside Grenada against one of the most powerful Prime Ministers in the Eastern Caribbean.
Dr. Mitchell does not see himself as an ordinary Prime Minister in light of the fact that in 2013 for the second time in his political career, the people of Grenada, Carriacou & Petite Martinique placed total confidence in him with a 15-0 landslide victory at the polls.
The Rex Grenadian vs. Keith Mitchell-led NNP battle is sure to end up before the Court of Appeal because a lot is at stake.
Without giving much detail, the administration has served notice that the taxpayers will not be footing the legal bills in the fight against The Rex but someone else.
The country has not been told who is that “someone else” which has resulted in many beginning to ask a number of pertinent questions including the possibility of deal making.
The government’s position on the saga surrounding the Rex Grenadian issue has not been helped by the utterings of two senior ministers – Agriculture Minister Roland Bhola and Health Minister, Nicholas Steele.
The latter had given the impression in a public statement that the hotel had not lived up to its commitment to government.
A response came rather quickly from The Rex in which it stated that it was in good financial standing and did not owe not one cent to the Treasury. No response came from either Steele or Bhola.
The Mitchell government ought to rethink its position on moving against the hotel since it is sending the wrong message to foreign investors that they could at some point in time be subjected to a hostile takeover of their investments in Grenada.
Social media is now at work and everything surrounding the Rex Grenadian saga is reaching persons around the globe with a little telecommunication gadget in their living room.
This is not the kind of message that a poor Third World country should be sending to the outside world.
There is surely another approach and a less painful road that the government can travel in order to resolve the Rex Grenadian issue.