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Nov 5, 2014

Court of Appeal Reserves Judgment in Telemedia Case

The Court of Appeal has reserved judgment in the case against Great Belize Productions, formerly a subsidiary of Belize Telemedia Limited.  On August twenty-third, 2009, the day before B.T.L. was nationalized, the board of directors of the company divested Great Belize Productions from its assets.  According to attorney Michael Young, the divestiture followed an investment of ten million dollars which was reportedly used to cover Channel Five’s expenses.  The matter has since been ventilated in the Supreme Court where a new B.T.L. board of directors successfully sued its predecessors following the takeover.  That decision is presently being appealed, despite arguments from Senior Counsel Eamon Courtenay that the previous board was indemnified of monies spent, as well as personal liability for its decisions.  This afternoon, Senior Counsel Michael Young presented B.T.L.’s position in the suit.

 

Michael Young, Attorney for B.T.L.

Michael Young

“Just before the government took over B.T.L. the board, as a matter of fact on a Sunday, did certain things.  What had happened is that when the company was controlled by the Ashcroft Group, they had been financing Great Belize Productions which is Channel Five and had financed it at that point up to some five million dollars.  And they had, on top of the financing, they had provided for the purchase of shares in Great Belize Productions for another five million.  So B.T.L. had expended around ten million dollars in relation to Channel Five and the acquisition of shares in relation to that company.  What the board did on the, I think it must have been on August twenty-third, 2009, is that they divested B.T.L. of its investment and they also wrote off the five million dollars that B.T.L. had financed Channel Five with, including even things like the payment of the telephone bills and even their Christmas party.  So B.T.L. had expended ten million dollars and had nothing to show for it.  That is the subject of the claim which we have put before the court.  The transactions were done through a maze of companies and we had to try to unravel that maze.  Once we determined what had taken place, formulated the claim and then we filed it.  What they did was that they applied to have the whole thing struck out, including in respect of what the directors had done that the directors are indemnified by an express deed of indemnity and also by the articles.  So they made an application to strike out the application on that basis and also some other bases.  That application for striking out was turned down by the court below and they have appealed it and this is what we have been addressing in court over the last couple of days.  The wrong as we contend, as far as we are concerned, is a wrong in law.  Here you have directors of a company, and as I mentioned before, at the end of the day the powers were exercised, we contend, in such a way that ten million dollars was paid out and the company has nothing to show for it.  There was some unjust enrichment in this regard and one of the big points is that as the minutes show of the directors of that day in 2009, is that they did this so that Channel Five could be a voice against the government.  That is, in fact, in the minutes interestingly, plus Great Belize Productions, the value of that company was increased and in turn the value of B.T.L. decreased.  We say in law that that cannot be right, but of course they differ and it remains for the court to determine the issue. We have formulated the claim in such a way that because B.T.L. once owned Channel Five when the Ashcroft Group was there and we are saying that the divestment of Channel Five, Great Belize Productions from B.T.L. was wrong and it needs to be brought back in.  So our claim has been formulated on that basis.”

 

A decision will be handed down in a subsequent session of the Court of Appeal.

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