The Jamaican Supreme Court has not yet ruled on the matter it is hearing this week of how to distribute an estimated J$375 million (US$6.14 million) held by the Jamaican Financial Services Commission (FSC) for the collapsed Dyoll Insurance Company.
A scheduled first interim payment to Dyoll’s creditors, many of whom have unpaid Hurricane Ivan insurance claims in Cayman, was halted two days after it began on 31 October by a Supreme Court order.
At issue is a dispute between the Joint Liquidators, Ken Krys of RSM Cayman and John Lee of PricewaterhouseCoopers Jamaica, and the FSC over what constitutes the deposit they are to hold for insurance companies as proscribed by Jamaican law.
That deposit might only be payable, under Jamaica’s Insurance Act, to Dyoll creditors in Jamaica.
The Joint Liquidators were originally led to believe that deposit was only J$45.3 million (US$740,000) but were subsequently informed it was J$375 million, which constitutes the majority of assets held by Dyoll.
Should the JFC be successful in its argument in front of Justice Sykes, there would be few assets left to pay Dyoll’s Cayman creditors Mr. Krys said recently.
Attorney Stuart Diamond, who represents a group of Cayman Dyoll creditors, said he expects the court proceedings to rap up on Thursday, and then for Justice Sykes to deliver a judgement next week.
Besides the issue before the Supreme Court, Mr. Diamond said leave was being sought to apply for a Judicial Review of some of the FSC’s actions.
Specifically, Mr. Diamond said the Judicial Review would look at whether the FSC allowed for due process in requesting Dyoll’s acting managing director to pay over the company’s assets shortly before the temporary manager was appointed; whether it was reasonable to request that amount as a proscribed deposit; and whether it was a necessity under the FSC guidelines to make such a request.
Mr. Krys does not think the FSC acted fairly.
‘They’re supposed to act in the best interest of all the creditors,’ he said. ‘How can they take an action that will be to the detriment of the Cayman creditors? That’s the big issue here.’