Ernst and Young has denied it is in a conflict of interest in relation to Baha Mar.

The government has identified accountants from that firm as proposed provisional liquidators for Baha Mar.

The allegation was contained in court documents and was read in court yesterday during the hearing to consider the winding up petition filed by the government against Baha Mar.

U.K. attorney Peter Knox, who appeared for the government, read the allegation.

It says that Ernst and Young did legal work for Baha Mar and is listed as a creditor of the company.

But attorney Megan Taylor, who appeared on behalf of Ernst and Young, dismissed the claim.

“There is no conflict,” Taylor said. “The allegation that Ernst and Young provided advice to Baha Mar is erroneous.

“There was an economic impact assessment done for all the major hotels. Baha Mar was a part of that.

“We would say that there is no conflict and Ernst and Young is not a creditor of Baha Mar.

“In the circumstances, Ernst and Young would like to ensure the court that neither Ernst and Young nor its independent parties has any potential conflict of interest.”

The government had originally proposed to have liquidators appointed from PricewaterhouseCoopers (PWC), but that fell through when the company revealed that it had done work for Baha Mar’s contractor, China Construction America (CCA).

The government then proposed to appoint liquidators from Ernst and Young.

U.K. attorney James Corbett, who appeared on behalf of Baha Mar, argued that the court should dismiss the government’s petition.

He said the argument that the appointment of joint provisional liquidators will solve Baha Mar’s problems is misguided and compared it to someone sprinkling “fairy dust” on a situation and hoping for the best.

“For over 10 years enormous effort and tremendous resources have been put into trying to develop the project,” Corbett said.

“It might be worth noting that it did not happen on its own or purely because of government action.

“It is not meant to be a swimming pool for the citizens of The Bahamas. It wasn’t simply to make money.

“The management, which has been criticized, brought the project to 97 percent completion.

“The suggestion here is that a provisional liquidator can get the three percent completed. But that ignores the 97 percent done by someone else.”

Defective

Knox wrapped up his submissions yesterday, arguing that if “a provisional liquidator is appointed there is at least a reasonable prospect of the completion of the project”.

“Provisional liquidators will prevent the dissipation of the company’s assets,” he said.

He added that the liquidators will try to reach a compromise with the parties.

“The need to complete the resort is fundamental to this case,” he said.

“We resist the notion that there be some sort of consultation process regarding the provisional liquidator.”

Maurice Glinton, QC, who also appeared on behalf of Baha Mar, said the government’s petition is “defective and misguided” and should be dismissed.

He accused the government of playing “musical chairs” regarding the appointment of a liquidator.

He said, “At one point we are given sight of two/three proposed liquidators then they are gone.

“Then another group is proposed and then they are gone. Now we have a third group.

“They have brazenly put to this court that a provisional liquidator should be appointed who can magically do what the current management has not been able to do.”

Attorney Wayne Munroe, who appeared on behalf of the Gaming Board, noted that a court document was filed in Delaware on Wednesday where the Rosewood Hotel and Resorts International is seeking to sever ties with Baha Mar.

Corbett said the document was “someone asking for something”.

But Munroe argued, “It may be indicative of things to come.”

Baha Mar filed for Chapter 11 bankruptcy in the U.S. district of Delaware on June 29.

Munroe argued in his submissions that Baha Mar is putting its casino license in jeopardy.

“We contend that this is not responsible behavior,” Munroe said.

“We say it is enough to replace the board with a provisional liquidator.

“You shouldn’t tempt us to revoke your license.

“The fact is you are behaving badly. Because of that the court should appoint a provisional liquidator.”

But Corbett dismissed that argument.

“We have never snapped our fingers and said it is the Gaming Board, so what,” he said.

“That is more than misplaced; it is a misdescription.”

The matter continues today.