Mar 02 - OEM Liquidation: Claims Against Government To Be Heard In Court
The Government of Gibraltar and the Liquidator of the OEM group of companies have been in dispute for some time now as to whether or not the Government is liable to pay the Liquidator compensation in respect of certain property developments taken over by the former Government from OEM companies in 2007.
The sum claimed by the Liquidator is £ 6,977,738, or alternatively £8,614,643, as well as interest and costs against HMGOG.
It will be recalled that the GSD administration had also granted an unsecured loan to OEM in the sum of £4,000,000. The liquidator is also seeking a release and discharge of all the liabilities in respect of this loan.
Given that it has not been possible to settle that dispute, the Government and the Liquidator have decided that the most appropriate way to determine the dispute is to refer it to the Supreme Court.
Accordingly, a claim has now been filed in Court by the liquidator, Mr Freddie White of Messrs Grant Thornton, after prior notification to the Government, which will shortly be filing its defence.
The case is expected to take some months at least.
Commenting on the above Joint Press Release of the Government and the Liquidator of OEM, the Chief Minister, Fabian Picardo, said: "This is a claim which relates to the housing schemes that went wrong under the GSD. We are still paying the price in hundreds of thousands of pounds for the tax payer of having to repair the estates as a result of the job having to be completed by GJBS based on bankrupt and insolvent developer's and contractor's designs. There is the matter of the unsecured £4m loan made by the GSD to OEM, which was never repaid. And there is now the matter of this claim for another £8m from the Liquidator. This is the rotten legacy left by the GSD in respect of the unsecured loans they granted, the homes they sold and the debt that is being claimed by Barclays. This is highly unsatisfactory and shows the public what we inherited from the GSD was far from a "golden legacy" and much more of a "rotten legacy" of debt, unpaid million pound loans and a huge repair bill."
