Court of Appeal rejects Government's claim

The Court of Appeal has rejected the Government's claim that the damages awarded to the National Transport Co-operative Society (NTCS) for breach of contract should be reviewed.

Lord Anthony Gifford, QC, and attorney-at-law Patrick Bailey, who represented the NTCS, had argued that the matter simply required a recalculation of the award to take into account the reduced period from 10 years to three. The NTCS, headed by Ezroy Millwood, is claiming $1.85 billion for the period.

The court is to hear legal arguments on the claim on March 28 and hand down a final award to the NTCS. The NTCS was awarded $4.5 billion, with interest, in October 2003 after a panel of arbitrators, chaired by retired Court of Appeal judge Boyd Carey, heard the dispute. The award against the Government was for breach of contract in failing to set bus fares at the level which had been promised under franchise agreements signed in 1995. The award was for a 10-year period.

The Government challenged the award on the basis that the franchise agreements had been illegal. The Government claimed that no damages should be paid.

The local courts set aside the arbitrators' award and the NTCS took the issue to the United Kingdom Privy Council, Jamaica's final appellate court, which ruled in November 2009 that the franchise agreements were legal for a limited period of three years. The Privy Council sent the case back to the Court of Appeal to consider the consequences of its judgment.

Differences arose between the parties about the scope of the Privy Council ruling. The NTCS submitted that it simply required a recalculation of the award to take account of the reduced period.

The Government had wanted the court to press the reset button on the matter of damages, and tendered an affidavit from transport consultant Dr Alton Fletcher, who claimed the NTCS should receive nothing.

The Court of Appeal ruled Monday that evidence brought by Fletcher was irrelevant and inadmissible. The Government was basing its arguments on the premise that the NTCS, in order to cut its losses, should have stopped providing bus services in Kingston after the State failed to increase bus fares.

But lawyers for the NTCS counterclaimed that such a move would have led to chaos in the transport system.