7 News Belize

Novelo’s & Receivership: The Sequel
posted (December 14, 2010)
Tonight, 40 year old Peter King Contreras is in lockdown at the Ladyville police station; he confessed to killing his mother in law and then driving around with her in the car! It is one of the most bizarre and disturbing cases of murder we've seen in recent times and Monica Bodden will have that story for you shortly.

But first, we go unto other news - and again it's about those National Transport Employees who are jobless and clueless about their last and next paychecks.

Last night you heard the cries of those employees. The concerns are genuine and the issue is real, but the bottom line is no one seems to want to take responsibility for paying these two hundred and seventy five employees who have been without work since last Friday.

Now, it's always the responsibility of the employer to pay their workers, but the Novelo's -artful players that they are at this receivership thing - have managed to divert the blame to the Belize Bank and its receivers.

And today, some sixty workers met with lawyers Dolores Balderamos Garcia & Lisa Shoman, as well as former owners of the company, David & Tony Novelo and their former operations manager, Phillip Jones.

It was a private meeting at the Novelo's home in King's Park - but we worked our way into the session where the concerns being ventilated hadn't changed- the workers told the head table that they need their money now and they want to know what the status of their employment is.

Here are a few excerpts of that meeting:

Tony Novelo, Former Co-Owner, NTSL
"We are bringing you all together because obviously this happened - we were surprised, you were surprised. I heard a driver reporting to me that even at gun point he was put in the bus to give his purse, If that is true or not true we are gathering together as a family, there are things that we need to put in place. The first question I want to ask right now is that a payroll had to take place on Friday, the money was there, so we need to start to get answers from the receiver where that money is for your payroll."

Employee
"All that talking is good to hear but while the grass is growing the horse is starving. We have family to feed, money is not there and we would want to know how you can help us for the holidays because we know that to get paid will not be before Christmas. So we want to know from you how you all can help us to get some money before Christmas."

Employee
"Charters and garage pay - all this was work done before receivership, is there any way that we can retrieve any money from that?"

David Novelo, Former Co-Owner, NTSL
"They took the money, the deposits; the receiver came and took it. They took all the money and that's what we are explaining."

Employee
"So you are saying that all the money was in the bin in the cash room? The vacation pay. Because I understand that no money was in the cash room, no money."

David Novelo, Former Co-Owner, NTSL
"Gentlemen let me tell you something here, if you look at the newspaper today - I mean all of you work with us, they are saying that there are busses in Mexico and Guatemala, you guys know there is nothing there. You guys have been with us, you know in terms of everything in operational of the company, you all know how we work, you all know that Burgos and the girls work every morning - they fix the deposit and the deposit is sent to the bank, so what you have to realize about this receivership was that when Kevin Castillo and Robert Garcia arrived, our attorney was there in the presence of Phillip Jones and Gilbert everybody said let's do a stock taking, let us show you what we have, let us show you the money inventory. They said no, get out! As soon as we wrap up this meeting Larisa will take one by one, so you all see what we already have worked in terms of what was owed. To other employees that are saying that there was garage pay that was owed and so forth, we want to make sure you cross-check with Ms. Larisa and Burgos will have all of that updated so that when we have our attorneys - do we have the consensus that Ms. Shoman will lead all of us together and a class action in terms of this?"

Crowd
"Yes."

David Novelo, Former Co-Owner, NTSL
"Ok, so what we will do then is make sure we have all our T's crossed and all our I's dotted so we take and everybody knows exactly how much everybody is paid."

After the meeting, we caught up with Brothers David and Tony Novelo to get the story from the always glib operators. They told us that they were totally taken by surprise last Friday when the company was taken over. They said they believe the decision made by the Belize Bank wasn't in good faith:

David Novelo: Former Owner of NTSL
"What is important about your question is that why did receivership happen on Friday. We feel that it did not had to have happened. We've had a very close relationship over ten years relationship with Belize Bank and even after the receivership happened with DFC and Atlantic Bank we continued working together. Really National was affected two and a half years ago when the zoning was implemented we have ongoing court cases when we lost that revenue that affected our cash flow position, it affected our revenue mainstream, so we have been basically very close together working with the bank we have been informing them every step of the way our attorneys have been also forwarding all the legal positions on it and on Friday I mean basically we had not been forewarned or anything at ten o'clock in the morning the bank decided to, Belize Bank decided to send a letter of demand and fifteen minutes later we had basically the receiver Kevin Castillo and Robert Garcia breaking in the doors and barging into the place. For all our employees who know our operations every Friday morning is when we compile our cash is taken to the bank and then salaries are processed. So basically what really happened on Friday salaries are processed at mid-day so when they came at ten o'clock they physically took over the monies that was there in the cashier's room and that's why the employees were not paid. Basically all accounts were seized."

David Novelo: Former Owner of NTSL
"The same attorneys and the same vigor they have been working in making sure that the company gets back in terms of its routes and so for the same thing we gonna pursue it with our workers in terms of their salaries and in terms of what supposed to be their severance pay. And we are saying that we want to safeguard the employment of all these two hundred and seventy five employees, we gonna re-apply again. Much things can be said about the family and our company but one thing can be said is that we can get you from point A to point B and you can depend on the service so that's what we intend to do."

Tony Novelo: Former Owner of NTSL
"So you said you were surprised when it happened on Friday. Didn't you have any prior knowledge that the company was going into receivership before Friday? No, my brother and I have been working. We have said it publicly clear from the year 2008 that routes were cancelled country wide. We have said it- the debt portfolio will be difficult to manage, we communicate it to Government we sat down with our bankers and said listen-we won't be able to meet our obligations, the cash flow- the earning cash flow of the company has been diluted. The bank has worked with us and really there has been no communication-well this is the end of the road-No. "

David Novelo: Former Owner of NTSL
"Up to this day I am still asking questions why Belize Bank take that initiative. They were aware that the court case was coming early January. By putting in receivership National Transport in the month of December really doesn't make sense even in the terms of business sense or banking sense, because what you're really doing is really and truly you're just making the employees and staff pay a price that they don't deserve- the hardest price of unemployment. I say as a prudent and responsible banking-the bank was aware that there was a thirty two plus million dollars of damages claim in court that would be heard in January so if you are a banker and you'd want to get back your money, you wouldn't like to prejudice that court case. So the reality is that I would like to say to the whole country- I personally would like to say that I feel the bank did not acted on a good faith basis. Belize Bank did not work on a good faith basis. Belize Bank did not exercise the fiduciary duty that they should've done, because there is a responsibility from the borrower and also to the one that lends money."

David Novelo: Former Owner of NTSL
"So you said earlier in the first receivership they took away all the busses but this time you still have some busses remaining? What happened is that the Transit -Belize Transit is total separate company. It has no liability basically because we have all these different companies pulled them all together to sustain and maintain National. So really and truly when the Receivers took over possession on Friday he took over a lot of assets that are not part of the Belize Bank. We acted on Monday and the Belize Transit is back. We have other runs like the Premier Line that goes to Chetumal-they're not part of the National Group. What we are hoping at this stage Andrea, the most important thing, get the employees' salaries paid and let's start moving and get them jobs for the next years to come. So there's no guarantee as to when they'll be paid? Well today as I said we can't give no guarantees all we can do is that, as directors of the company and workers we will stand hand in hand and make sure that the receiver/Belize Bank pay their alimony that is due."

We contacted the Belize Bank about the Novelo allegations and representatives of the bank issued the following response to comments made by David Novelo (look down):

(i) The decision to place NTSL into receivership was a prudential one given the financial situation of the company;

(ii) It would have made no prudential sense to defer receivership until the conclusion of a case the conclusion of which and the outcome of which are entirely uncertain; it could drag on indefinitely;

(iii) In any event the case can be carried on under the receivership and, if any benefits flow from the case, it accrues to "NTSL in Receivership" so there is no prejudice to the court case, even assuming the claim has merit;

(iv) The situation regarding the workers will be carefully examined and dealt with by the Receivership. In the meantime, those responsible for the financial position of NTSL are exploiting the situation of the workers to excuse their own conduct and to call into question the Bank's good faith."

So the Novelo's are accusing the Belize Bank of acting in bad faith and the Bank is accusing the company of "exploiting the situation…to excuse their own conduct". Cases can be made for both sides of the story but, jump high, jump low, for 275 workers, the bottom line remains the same: Christmas is here and they've got no job and no paycheck for their last week of work.

Which brings us to the issue of the safe that Phillip Jones brought up yesterday. He said that Up until Friday morning they had over $65,000 dollars in the company safe to make payment for the payroll and issue Christmas bonuses. We certainly got a generally skeptical view of this from some workers -but whne we tried to contact the receiver Kevin Castillo to ask about it, both yesterday and today, on both occasions, he strictly had no comment….

Home | Archives | Downloads/Podcasts | Advertise | Contact Us

7 News Belize