Former CEPEP board members sued over $1.4B pre-election contract extensions

Derek Achong

Se­nior Re­porter

[email protected]

For­mer Com­mu­ni­ty-based En­vi­ron­men­tal Pro­tec­tion and En­hance­ment Pro­gramme Com­pa­ny (CEPEP) chair­man Joel Ed­wards and 10 for­mer board mem­bers are fac­ing a law­suit over their de­ci­sion to ap­prove a three-year ex­ten­sion for con­trac­tors just days be­fore last year’s gen­er­al elec­tion.

On Thurs­day, lawyers rep­re­sent­ing CEPEP, led by Se­nior Coun­sel Anand Ram­lo­gan, filed the case al­leg­ing breach of fidu­cia­ry du­ty, neg­li­gence, and de­ceit by the for­mer board. This is the first law­suit launched by the cur­rent Unit­ed Na­tion­al Con­gress (UNC) coali­tion gov­ern­ment over de­ci­sions tak­en by a state board un­der the pre­vi­ous Peo­ple’s Na­tion­al Move­ment (PNM) ad­min­is­tra­tion.

The de­fen­dants are Ed­wards, Gee­ta Ram­per­sad, Kirt Bernard, Thomas Sanoir, Wen­dell Williams, Yin­ka Jag­bir-Gar­cia, Camille Ho­sein, Mau­ris­sa Smith, Robert Lee, Bri­an Rock, and Michael Seales. CEPEP is seek­ing sig­nif­i­cant com­pen­sa­tion, in­clud­ing hav­ing Ed­wards in­dem­ni­fy the com­pa­ny for any li­a­bil­i­ties aris­ing from the mass ter­mi­na­tion of con­tracts by the cur­rent gov­ern­ment in June last year.

Ac­cord­ing to court fil­ings ob­tained by Guardian Me­dia, in late March 2023, an of­fi­cial from the Min­istry of Lo­cal Gov­ern­ment and Rur­al De­vel­op­ment ap­proached CEPEP chief ex­ec­u­tive Kei­th Ed­dy re­gard­ing the con­tract re­newals. The fil­ing claims Ed­dy con­sult­ed Ed­wards, who al­leged­ly as­sured him that Cab­i­net had ap­proved the re­newals.

The law­suit states that Ed­dy was al­so con­tact­ed by for­mer Min­is­ter Faris Al-Rawi, who re­quest­ed that the re­newals pro­ceed but did not pro­vide any writ­ten ap­proval. The for­mer board, re­ly­ing on Ed­wards’ rep­re­sen­ta­tions, ap­proved the ex­ten­sions in a “round-robin” vote days be­fore the April 28 elec­tion—Seales ab­stained from ap­proval but did not raise ob­jec­tions.

CEPEP al­leges Ed­wards made false rep­re­sen­ta­tions and used de­ceit to se­cure the re­newals, which could have re­sult­ed in ap­prox­i­mate­ly $1.4 bil­lion in ex­pen­di­ture. “In each case, Mr Ed­wards act­ed dis­hon­est­ly, know­ing the state­ments were false or mis­lead­ing, or at least made them reck­less­ly with­out gen­uine be­lief in their truth,” the com­pa­ny’s lawyers said.

The law­suit fur­ther claims Ed­wards failed in his du­ty un­der the Com­pa­nies Act by not seek­ing le­gal ad­vice or con­sid­er­ing the fi­nan­cial im­pli­ca­tions of the re­newals be­fore pre­sent­ing them for board ap­proval. “He failed to as­cer­tain, or dis­close to Mr Ed­dy and the oth­er di­rec­tors, crit­i­cal fi­nan­cial de­tails in­clud­ing pro­ject­ed costs, fund­ing sources, cash-flow pro­files, and ter­mi­na­tion ex­po­sure, pre­vent­ing in­formed judg­ment,” the fil­ings state.

CEPEP as­serts that, apart from Seales, the board mem­bers did not act in the com­pa­ny’s best in­ter­ests or in good faith. “The board’s de­ci­sion was in­flu­enced by im­prop­er po­lit­i­cal con­sid­er­a­tions, de­signed to con­fer fi­nan­cial ben­e­fits on core con­trac­tors and op­er­a­tional per­son­nel on the eve of the elec­tions to gain an un­fair po­lit­i­cal ad­van­tage,” the lawyers said.

Re­gard­ing Seales, the com­pa­ny crit­i­cizes him for fail­ing to ob­ject to the re­newals. The law­suit al­so ad­dress­es a 2017 Cab­i­net note ref­er­enced by Ed­wards, which pur­port­ed­ly au­tho­rized CEPEP’s board to re­new con­tracts to main­tain op­er­a­tional ef­fi­cien­cy.

CEPEP high­light­ed that a Min­istry of Fi­nance au­dit in No­vem­ber 2023 raised con­cerns about in­creas­es in con­trac­tor num­bers, and by Jan­u­ary 2024, the min­istry di­rect­ed that no new con­trac­tors be hired. The com­pa­ny claims it in­curred $6,617,238.73 in loss­es from pay­ing con­trac­tors in lieu of no­tice fol­low­ing con­tract ter­mi­na­tions.

The com­pa­ny is al­so de­fend­ing claims from oth­er con­trac­tors, which could re­sult in ad­di­tion­al com­pen­sa­tion li­a­bil­i­ties. “If any con­trac­tors’ claims are suc­cess­ful, CEPEP claims dam­ages and eq­ui­table com­pen­sa­tion from Mr Ed­wards, in­clud­ing in­dem­ni­ty for all such claims, due to the cir­cum­stances aris­ing from his al­leged wrong­do­ing,” the lawyers said.

CEPEP is seek­ing ex­em­plary and ag­gra­vat­ed dam­ages against Ed­wards, stat­ing that such awards would re­flect the court’s con­dem­na­tion of im­prop­er con­duct by a pub­lic of­fi­cer.

The case has been as­signed to High Court Judge Christo­pher Sieuc­hand, who will hold a case man­age­ment con­fer­ence in the com­ing weeks. The board mem­bers will then have the op­por­tu­ni­ty to file their de­fens­es.

CEPEP is al­so rep­re­sent­ed by Jared Ja­groo, Ganesh Sa­roop, Aasha Ram­l­la, Aria Khan, and Aaron Re­gault of Free­dom Law Cham­bers.