The dispute between the Cayman Islands Government and Tom Jones International Ltd. over the building of two new high schools looks to be heading for a court battle after the Ministry of Education issued termination notices on the contracts Wednesday.
General contractor Tom Jones International walked off the construction sites for Clifton Hunter and John Gray High Schools on 13 November, claiming government had breached the contracts, partially because it refused to provide evidence it could pay for the work. On Thursday, government issued notices of termination of both contracts, claiming Tom Jones had breached the agreements.
The notice of termination letters, which were signed by Ministry of Education Chief Officer Mary Rodrigues, asserted that Tom Jones had ‘no contractual basis for the work stoppage’ and that the contractor’s actions in ‘terminating its staff, abandoning the project site, and failing to perform the work pursuant to the terms of the contract, are substantial breaches of the contract’.
‘Having now completed its investigations into TJI’s conduct over the past 10 days, the owner has determined that TJI has effectively abandoned the project and has no genuine interest in re-mobilising in order to perform the work and meet its obligations to the owner under the contracts.’
Nearly identical letters were sent by the Ministry of Education with respect to both high schools.
The letters cited two particulars of breaches under the contracts. The first concerned the work stoppage, which the Ministry of Education said commenced wrongfully without following the dispute resolution procedures set out in the contract.
The Ministry of Education also asserted that Tom Jones was in breach of the contract for failing to make payment due to at least one subcontractor on the projects.
‘The Owner’s record show that TJI has received full payment from the owner for all amounts currently due and owing to the subcontractor, and TJI’s failure to direct payment on to the subcontractor out of the funds it has received from the owner is a substantial breach of the contract.’
Although the letter did not mention the name of the subcontractor, as reported in the Caymanian Compass yesterday, Caribbean Mechanical (High Schools 2008) Limited filed a lawsuit against Tom Jones International this week, claiming CI$2.24 million for work done through the end of September on which payment was past due.
The letters sent by government to Tom Jones gave a seven-day notice of termination of the contract. The termination will take effect at 4pm on Wednesday 2 December.
‘A second letter will follow shortly setting out the owner’s directions for protection and preservation of the work at the project site during the notice period, the handling of all materials, equipment, tools and construction equipment and machinery on the project site, and the return of the government’s property on the termination date,’ the letter stated.
The letter stated that Tom Jones would be held accountable for any and all damages incurred as a result of the breach.
‘The owner is currently assessing the nature and extent of those damages and it hereby reserves all of its rights under the contract and at law.’
A press release issued Wednesday by the Ministry of Education with regard to the termination notice said the government had taken the action ‘in order to protect its interests and to mitigate the costs and schedule damages associated with the substantial breaches by Tom Jones International Ltd.’
In response to the events, Tom Jones International President Hunter Jones issued a statement on Thursday.
‘It is an unfortunate situation the company finds itself in,’ he said. ‘We worked very hard to cooperate with both the previous and current governments. We wanted evidence that they could afford these schools, and that evidence has not been forthcoming.’
Mr. Jones also commented on the lawsuit filed by Caribbean Mechanical.
‘Regarding Mr. [Alan] Roffey’s claims on behalf of Caribbean Mechanical, we would have been happy to look after his accounts if government had looked after their accounts properly with us,’ he said.
Mr. Jones vowed a further response from Tom Jones International.
‘We will defend our positions vigorously in the appropriate forums.’