Lindquist to investigate WASA/Water Farm settlement

Even as Minister of Public Utilities Rennie Dumas claimed ignorance about Forensic Investigator Robert Lindquist’s inquiry into the legal settlement between the Water and Sewerage Authority (WASA) and Water Farm Ltd, Attorney General Senator Glenda Morean yesterday said information is being supplied to Lindquist and his report will be available to “one and all” when it is completed.

“Documents and information are to be made available to Mr Lindquist so that he can assess exactly what he has to do. He has not yet received all the necessary information so we can’t say how long it will take,” Morean told the Senate yesterday as she responded to a question from Leader of the Opposition in the Senate Wade Mark. Only one month ago Prime Minister Patrick Manning asked the House to suspend its Standing Orders so he could make a supplementary statement (after Dumas) in response to allegations made by Opposition Chief Whip Ganga Singh about the settlement. Last July WASA’s Board of Commissioners agreed to pay Water Farm $51.5 million over a nine-month period to settle out of court.

Morean intervened after Dumas was unable to respond to Mark’s questions regarding Lindquist, or an Ernst and Young report which recommended that WASA settle out of court with company for $11 million. Dumas had told the Senate shortly before, “The specifics of the recommendations by Ernst and Young are not available to me at this point.” He also could not say who comprised the legal team which advised WASA to settle with Water Farm for $51.5 M. Mark also sought through the Senate President Linda Baboolal to have Dumas make available a copy of the E&Y report to Parliament. But Dumas reiterated that Prime Minister Patrick Manning has agreed to the forensic investigation and Parliament could await Lindquist’s report.

Providing the background to the legal settlement he told the Senate that in 1995 WASA entered into eight contracts for the management of well fields in selected areas. However, the following year they were terminated after it was decided that the Executive Director had no authority to enter into and execute the contracts. The companies involved including Water Farm took legal action against WASA for breach of contract. Water Farm sought $74.4 million in damages. E&Y was hired to determine compensation which should be paid to Water Farm based on the work done on the premise that the contract was invalid and properly terminated. Dumas said the new WASA Board of Commissioners in March last year sought legal counsel and was advised the contract was wrongfully terminated. Settlement moved from being “compensation, for work done, to include other factors including loss of earnings.” WASA was also advised that it would not be successful in the matter.