Cepep battle heats up

Former Rural Development and Local Government minister Faris Al-Rawi, left, speaks with former Community-Based Environmental Protection and Enhancement Programme (Cepep) chairman Joel Edwards, centre, and CEO Keith Eddy at a Health Safety Security and Environment exhibition held at Cepep’s head office, Factory Road, Ste Madeleine, on April 26, 2024. - File photo

A HIGH-STAKES legal battle is intensifying between state-owned Cepep Co Ltd and its former chairman Joel Edwards over allegations he misled the company’s board into approving contract extensions worth an estimated $1.4 billion.

In correspondence exchanged between attorneys this week, Cepep’s legal team, led by Senior Counsel Anand Ramlogan and attorney Jared Jagroo of Freedom Law Chambers, accused Edwards of falsely claiming Cabinet had approved the extension of 336 contracts for core contractors, key personnel and operational services until 2029. The move, they argue, locked the company into massive financial commitments without proper authorisation.

The accusations stem from a board note dated April 23, signed by Edwards, which stated that “Cabinet had agreed to the proposed extension of contracts across the company.” Cepep’s CEO, Keith Eddy, said Edwards personally assured him that then-line minister Faris Al-Rawi had confirmed Cabinet’s approval which Eddy says was never supported by written evidence.

Justice Margaret Mohammed, presiding over a lawsuit over the termination of contracts by Eastman Enterprises Ltd delivered judgment on August 7, ordering the matter stayed and all case documents referred to the Director of Public Prosecutions for review. The court found “serious questions” about the approval process, noting allegations of fraudulent misrepresentation involving Edwards, Eddy and Al-Rawi.

In response to Cepep’s July 25 pre-action letter, Edwards’ attorney, St Clair Michael O’Neil, requested extensive disclosure, including certified copies of board minutes, Cabinet notes, and government correspondence. He argued that Cepep’s 14-day deadline breached pre-action protocol and that his client could only respond fully after reviewing the requested material.

However, Cepep’s lawyers rejected the request as a “fishing expedition” and accused Edwards of showing “casual indifference” to the gravity of the allegations, particularly given his travel abroad and his counsel’s absence.

“The court carefully analysed the evidence in this matter and recited the pivotal role played by your client in the Board’s decision to extend approximately 336 Cepep contracts at a cost of some $1.4 billion.

“It is abundantly clear that your client, Mr Joel Edwards is one of the main protagonists in this scandalous drama. We trust that the findings made by the court in its judgment and the reference to the DPP were sufficient to impress upon your client the need for urgency and expedition in this matter.”

“His flippant excuse is somewhat amusing and troubling – it shows that he is yet to appreciate the serious personal consequences in both the criminal and civil law that may be attributed to him in this matter.”

Jagroo reminded that Edwards “stated quite clearly that Cabinet had considered and approved the extension of all contracts across the company,” and had signed the board note.

“Your client’s attitude would have no doubt by now been radically changed in light of the referral of this matter to the DPP.

“We note that your client carefully navigated his way around the core allegation that he told CEO Eddy that then-line minister Faris Al-Rawi had informed him that Cabinet approval has been granted authorising and directing Cepep to extend all core contractors and key operational personnel and services for a maximum period of three years.

“We would appreciate a direct response to this very serious allegation which implicates Senator Al-Rawi in the serious fraudulent misrepresentation that was perpetuated against Cepep.

“This is particularly important because while Senator Al-Rawi has had several press conferences to address this issue, he has not in fact denied telling Mr Edwards that Cabinet had granted the necessary approval for Cepep to extend the said contracts.”

Jagroo asked for details surrounding approval and noted, “It is either Mr Al-Rawi did in fact advise your client of this and he relied on that representation and in good faith instructed that the board note be drafted and circulated in reliance upon that representation.”

The correspondence suggested that the former minister had not given the alleged advice to Edwards, then it would follow that the former chairman’s representation to Cepep about Cabinet’s approval would have been false.

Jagroo also asserted that such a scenario would indicate a serious matter involving the accuracy of information provided to the company. The letter also described the explanation of an “error” as implausible, and said that none of the requested documents were relevant to that point.

Jagroo urged Edwards to clarify why he informed the board that Cabinet had granted approval and the basis for instructing that the board note be prepared in the way it was. They have given him until August 15 to respond directly to the central question of whether Al-Rawi told him Cabinet had granted approval.

Cepep says it will seek to hold Edwards personally liable for any losses.