Baha Mar yesterday blasted the government over its attempt to have partners from PricewaterhouseCoopers (PwC) appointed as provisional liquidators to wind up Baha Mar, only to make what it called a "preposterous reversal" in the Supreme Court yesterday. However, in response, the government accused Baha Mar of being misleading.
In its statement, the government said that it makes no apologies for ensuring that the proposed provisional liquidators are "free of any real or perceived conflict of interest".
As Justice Ian Winder heard the government's winding up petition, the government's legal counsel advised that it would be "inappropriate" to proceed with PwC, saying the company advised the government of a potential conflict of interest on Thursday.
Attorney Peter Knox, head of the government's legal team in the winding up petition, said PwC indicated that it had previously acted for China State Construction Engineering Corporation (CSCEC). Knox said this was news to the government as there was no previous indication of a conflict or potential conflict of interest.
He announced that the government has engaged three prospective liquidators from Ernst and Young and requested an adjournment of the winding up hearing. Baha Mar's legal team requested more time to complete enquiries on the new proposed liquidators. Winder adjourned the matter to August 19.
In a statement released shortly after the hearing, Baha Mar said, "The government's hastily submitted application contained numerous fatal flaws in procedural terms." The alleged errors were not detailed.
"Those errors were then compounded by their last minute announcement that the persons they had proposed to act as provisional liquidators were, in the government's revised estimation, unsuitable," Baha Mar continued.
"In any case, the appointment of a provisional liquidator is entirely unwarranted under the law.
"And given how the government's first attempt to recommend three PWC partners resulted in a preposterous reversal, we cannot accept at face value the government's assertion that it has now taken the appropriate steps to get it right."
However, the government said it has sought to facilitate an impartial process that will result in the opening of Baha Mar, under private ownership and operation, as soon as possible.
The government said it has also sought to create a fair playing field for the development by first encouraging and facilitating talks toward an agreement, then paying the wages of Bahamian employees and as a precaution, filing for winding up in the national interest. The government said notwithstanding the winding up proceedings, it acknowledged that Baha mar and CSCEC reported as of 6 p.m. on Thursday that progress was made on an out of court settlement.
"A postponement of today's hearing was advisable if only to encourage the agreement towards which the parties appear to be progressing," read the statement. "Should Baha Mar Ltd., the Export-Import Bank of China, and China Construction America be unable to resolve their dispute, however, appointing a provisional liquidator would allow all parties a mechanism for fair, independent, third-party restructuring, completion and opening of the resort.
"As such, it has always been understood that a liquidator must be entirely free of conflicts of interest in order to be appointed. "Under a liquidation scenario, this is the only way to ensure the fairness and balance we seek." But Baha Mar insisted the government's winding up petition is "misguided and without merit, and the whole process is abusive, oppressive and undertaken in bad faith".
"We are concerned that the government's continued actions are only serving to distract the parties from the negotiations that are continuing, where we are making real, if slow progress, and to which we have always been committed," read Baha Mar's statement.
"Our unwavering aim is to reach an outcome that enables Baha Mar to complete construction and open the resort to the benefit of The Bahamas."
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