The Cayman Islands government will seek to change the law to protect both appointed members of statutory authority boards and government workers who serve those agencies from legal liability arising from certain negligent actions.

The term “negligence” is used in a proposed amendment to the Public Authorities Law, rather than “bad faith,” which Premier Alden McLaughlin has said would not be protected if it should occur.

The amendment bill reads in its memorandum of objects and reasons: “a board, board member or employee of a public authority shall not be liable in negligence where that board, board member or employee is exercising a regulatory, monetary, cooperative or advisory function or duty.”

The legislative amendment is proposed after lawmakers in March agreed to emergency indemnities for members of the Liquor Licensing board of Grand Cayman, as well as the Cayman Islands Monetary Authority. The amendment bill, if approved, would apply to all statutory authority boards – of which there are dozens active in the islands.

Indemnities are personal protections for members of boards or public entity staff members that generally shield them from personal liability arising from any legally erroneous decisions made during the course of their official duties. Put another way, the government or the entity is legally responsible for such a decision, not the person directly involved.

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During debate on the emergency indemnities in March, Commerce Minister Joey Hew said that last year’s controversy involving the Liquor Licensing Board of Grand Cayman had put prospective board members on edge, after a board decision to first allow, then disallow the sale of alcohol on Sundays at a local gas station convenience store.

The situation made it “next to impossible” to find replacements for then-Acting Board Chairman Woody DaCosta, as well as for the board’s deputy chairman, Mr. Hew said. Eventually, veteran board member Noel Williams stepped in to the chairman’s post.

However, Premier McLaughlin warned, even with the newly approved legal protections, actions such as those taken by Mr. DaCosta would not be tolerated and could have personal legal ramifications for those involved.

“We’ve had very bad conduct by one former member of the Liquor Licensing Board, Mr. Woody DaCosta, who, among other things, appears to have fabricated [meeting] minutes and, it seems, manufactured a meeting which did not occur. Absolutely terrible behaviors … and the Cabinet moved as it needed to and terminated his appointment,” Mr. McLaughlin said at the time. ”When you are given a role such as deputy chairman of the Liquor Licensing Board and you behave in such a way, you cannot expect to continue in that role or expect the government to speak on your behalf.”

In response to Mr. McLaughlin’s comment, Mr. DaCosta said the premier had “slandered his character” and was attempting to mislead the public using the legal protections afforded by parliamentary privilege.

Aside from the difficulties experienced by the liquor board, Financial Services Minister Tara Rivers noted that several members of the Cayman Islands Monetary Authority board of directors had “expressed a reluctance to continue in their roles” without a deed of indemnity.

The concern, according to Attorney General Sam Bulgin, arose over the adoption of the government’s Public Authorities Law, which regulates the operation of statutory authorities like CIMA. The Public Authorities Law now protects board members from liability arising from decisions, save in cases of bad faith or negligence, but it is the word “negligence” that concerned board members, Mr. Bulgin said.

Mr. Bulgin said it was likely a matter of amending the Public Authorities Law to provide what board members felt was adequate protection, which the proposed amendment to the Public Authorities Law now seeks to do.

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