On Thursday we told you about Justice Minnette Hafiz’s decision on the
loan note and settlement deed between the Belize Bank and the Musa administration.
Well, tonight both the government and the bank are offering two different interpretations
of the judgment, but government is going one step further: it’s demanding
the other US$10 million government used the pay off the Universal debt, not
the Venezuelan $10 million, the Taiwanese $10 million.
The statement from the Prime Minister’s office contends that Justice
Hafiz declared the loan note of March of 2007 unlawful because it did not get
a resolution of the National Assembly as is required by the Finance and Audit
Reform Act. But more than that, government points to the fact that in May of
2007, the Solicitor General gave the court the undertaking that government would
not pay the guarantee until the case was settled. Well, it was just settled
on last week Thursday, but US$ 20 million, $10 from Taiwan and $10 million from
Venezuela was paid to settle the debt in 2007 and 2008.
Government has gotten back the Venezuelan $10 million and now it’s saying
that it also wants back the Taiwanese US$10 million. Why? Because that’s
also satisfying the loan note, which– according to the judge – was
unlawful in the first place. The government warns that the Belize Bank could
face civil and criminal liability by holding unto the Taiwanese $10 million.
But the bank has a different view. In a statement today it correctly states
that that while the settlement deed stands- the loan note has indeed been declared
unlawful. But in the bank’s opinion, that does not absolve the government
of its obligation to settle the UHS debt. The bank says that in her 70 page
judgment Justice Hafiz held that the bank does have legitimate claims against
the government.
As for the Taiwanese $10 million, the bank says that government will have to
go to London if it wants that, because a previous Supreme Court judgment found
that arbitration proceedings are the proper forum for any claims concerning
those funds to be settled. And as regards the unlawfulness of the loan note,
the bank cites the judge’s conclusion that the Belize Bank had only entered
into it because government representatives indicated that they had complied
with all statutory requirements, including those of the Finance and Audit Reform
Act – saying basically that they were misled.
And while government’s release ends by saying it will now pursue the
Taiwanese funds, the banks’ release ends by saying that it will continue
with arbitration proceedings to recover all funds that it loaned.