By Barbara Gayle, Staff ReporterTHE GOVERNMENT is expected to pay a record $4 billion in damages to the Ezroy Millwood-led National Transport
Co-operative Society (NTCS) for breaching a bus franchise agreement.
This follows the Government's take-over of the public transportation system in
the Kingston Metropolitan Transport Region (KMTR), with nearly five years still left on a 10-year agreement it had entered into with three independent franchise holders.
Robert Pickersgill, the Minister of Transport and Works, said that the Government has noted the award, and that lawyers are analysing the 50-page document setting out the reasons for the award "in order to report fully to the Standing Cabinet Sub-Committee."
He said in a statement last night that thereafter the Government will indicate
how it intends to proceed with
the matter.
The arbitration award, which was made yesterday, is for the years 1995 to 2001 and interest is to be calculated from the end of each accounting year at the Treasury Bill and commercial bank rates.
The NTCS was responsible for providing public transportation up to March 2005, but this ended in 2001.
With Mr. Millwood as its president, the NTCS was one of the biggest players in the public transport sector with more than 400 buses operating within the Northern and Portmore franchises.
"If you pursue your rights in a professional way, as long as it may be, you will get your reward," Mr. Millwood said yesterday after the award was handed down. He said he was now convinced that there was no prejudice within the law and "the law is there to protect the innocent."
Attorney-at-law Patrick Bailey, who along with Lord Anthony Gifford, Q.C., represented Millwood, described the award as "the largest award in the history of the country".
Prior to the Government's re-entry into public transport and the setting up of the Jamaica Urban Transit Company (JUTC), the franchise for public transportation was run by three franchise holders. They were the NTCS, the Arthur Chin-controlled Conurban Transit Ltd., which operated buses on the Spanish Town and Papine routes; and the Metropolitan franchise which controlled the eastern routes between Bull Bay in East Rural St. Andrew and downtown Kingston. The take-over was done on a phased basis beginning with the eastern routes.
The dispute between the NTCS and the Government began in 1996 when the NTCS applied for a fare increase. This was not granted up to 2000.
As a settlement, the Government had offered the NTCS $172 million with roughly $72 million being for the remaining four-and-a-half years of the franchises and the remainder for its fleet of 400 buses. The NTCS, which was seeking $7 billion in compensation, rejected the offer.
FILED A SUIT
The NTCS subsequently filed a suit in the Supreme Court in August 2000 seeking $3.7 billion in damages as compensation for its two bus franchises.
After the suit was filed, the parties signed an agreement on March 7, 2001 that the matter should go to arbitration and the suit was withdrawn.
Arbitrators comprising the chairman, Justice Boyd Carey, retired judge of the Court of Appeal, Hon. Ira Rowe, retired President of the Court of Appeal, and Angela Hudson-Phillips, Q.C., heard the dispute.
The arbitrators had several hearings last year and ruled yesterday "that the Government of Jamaica to pay to the NTCS damages amounting to just over $4 billion for breach
of contract.
"We further award interest calculated from the end of each accounting year in which damage was suffered until the date of this award calculated at the average of the Treasury Bill rate and the commercial bank lending rate," the arbitrators ruled.
The Government is also to pay NTCS' costs in relation to the arbitration and the suit which was filed in the Supreme Court.
