Fortis seeks injunction on SSB investment

Arguments were presented on Thursday, October 18, before a panel of three Appeal Court Justices on an interim injunction filed by Fortis Inc., the former owner of Belize Electricity Limited (BEL), to stop the Belize Social Security Board from investing $15 million  worth of shares in the cash strapped electricity company.

Attorney Denys Barrow, SC, representing the Government of Belize, which acquired fifty-one percent of BEL, through nationalization, submitted to the court that BEL needs to raise finances. 

But in rebutting Barrow’s submission, Eamon Courtenay, SC, representing Fortis, told the court that his learned friend’s “argument misses the syllogistic mill.”

Courtenay argued that any taking over of assets that is in violation of Section 16 and 17 of the Belize Constitution is unlawful.

The Belize Court of Appeal President, Justice Manuel Sosa, who heard the case along with Appeal Justices Samuel Awich and Douglas Mendez, asked Courtenay if the court is limited in the remedies that it can apply?

Courtenay responded, saying that Section 20 of the Constitution gives the court the widest powers to fashion a remedy.

Following their arguments in court, Barrow told reporters that the application that Fortis made was extremely wide ranging when it was filed. But now it has come down to the argument that if preference shares are issued then the ordinary regular shares might be devalued.

Barrow said that his submission is that by putting money into the company, that increased the values of the company.

Court-enay told reporters that Fortis has asked the court to grant an interim relief to prevent BEL from issuing preference shares to the SSB to assist in the  financing of the operations of the company.  “We have asked the court to stop them from doing that,” he said.

Courtenay added that if Fortis wins its case against government and gets back the company, we would then have a set of shareholders who are preferentially treated as compared to Fortis.

Asked if it would not be in the interest of Fortis to allow the shares so that the company can be kept afloat, Courtenay said that he was very clear to the court that his clients are  not attempting to stop the company from raising money to finance its operations.

Courtenay explained that he told the court that Fortis would not oppose   the issuance of debentures. “BEL must be able to finance its operations to provide power for the country.”

“It is not the intention of Fortis to interfere with that.

“What we are saying, however, is that preference shares are not the only way to raise money. Preference shares  have a lasting effect on the company, or at least until they are redeemed, if they are redeemable.

“We are asking the court for the next few months not to issue those types of shares,” Courtenay said.

Courtenay added that in  Fortis’ view, the present BEL board is there unlawfully, although the court has not yet made a ruling on that.

“It is a temporary relief that we are seeking the court’s intervention” Courtenay said.

“Fortis does not want to damage BEL at all, in the event that we win our case and get back the company, he added.


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