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Dyoll liquidators anxious to settle coffee case
published: Friday | February 9, 2007
Camilo Thame, Business Reporter
Several acres of Blue Mountain coffee growing on a farm owned by the Wallenford Coffee Company. Dyoll liquidators are trying to settle the coffee case with 6,000 farmers instead of fighting appeals. - Colin Hamilton/Freelance Photographer
The liquidators winding up the Dyoll Insurance Company say they want to negotiate a settlement, rather than fighting at appeal, a lower court ruling that nearly 6,000 Jamaican coffee farmers should be the sole beneficiaries of US$3 million expected from foreign re-insurers for crops damaged by Hurricane Ivan in 2004.
But John Lee, senior partner in the accounting firm of Pricewaterhouse- Coopers, who is one of the two court-appointed liquidators, say they have been unable to tie down the coffee group to a serious exploration of settlement.
"The joint liquidators have tried repeatedly on numerous occasions since November to meet with Coffee Trustees," Lee told the Financial Gleaner.
Lee, on the face of it, may be finding support from the Jamaica Agricultural Society (JAS), whose president, wants the Public Defender to help steer the parties to a settlement.
"I had discussions with the public defender to the get two parties to the table," Grant said. "He has expressed willingness to make himself available. It is important that someone of that office intervene to bring finality to the matter. US$3.2 million is there, out of which substantial legal fees he been paid, while the coffee farmers, in the meantime, are suffering."
Pool the money
The liquidators, Lee and Kenneth Krys of of the Cayman Island firm, RSM Cayman, had argued that the cash, rather than going only to the coffee farmers, should be part of a pool to benefit all Dyoll policy holders who would have taken a hit when the insurance company under the weight of its Ivan-related claims.
If the liquidators win at appeal, which could a protracted and expensive battle, the farmers, it is estimated would be entitled to between US$1 and US$1.5 million of the reinsurance payment. However, Lee and his partner have suggested that the disputing should short-circuit the process, and negotiate a settlement along the lines between the agreement arrived at between the liquidators, Safe Haven, a Cayman Island golf club that was in similar position as the Jamaican coffee farmers.
The lower court had ruled that the US$8 million expected from the reinsurers for damage to that property, belonged to Safe Haven, controlled by the Jamaican Matalon family.
But rather than wade through the appeal, which could reach as far as the UK-based Privy Council, racking up big payments to lawyers, Safe Haven negotiated a settlement. However, Lee declined to disclose the specifics of the agreement, including how much cash Safe Haven would get.
In the original ruling, Jamaican Justice Brian Sykes, held that Dyoll was not the primary insurer for either Safe Haven of the coffee farmers and had only lent its name to legitimise the transactions they had with other insurers.
Lawrence Jones of law firm DunnCox, which represent the coffee trustees, told Financial Gleaner that he was awaiting instructions from his clients. He declined to comment on their likely position on a negotiated settlement.
The issue was apparently discussed at the trustees' monthly meeting on Wednesday, but there has been no public statement on any decision arrived at.
The JAS' Grant, who heads the Mavis Bank coffee factory, warned that a drag out contest could, in the end, leave coffee farmers empty-handed.
"If it is prolonged the farmers may get nothing at the end of the day," he told the Financial Gleaner. "Someone needs to step in to bring closure to the issue. My understanding is that it could take up to three years to conclude.Ó
As at September 30, 2006, just under $1 billion was accounted for on Dyoll Insurance's books as well as in amounts held in trust by regulatory authorities Ñ h in Jamaican and Cayman, to pay claims Ñ to pay winding up claims. That sum included the combined US$8 million (J$740 million) that would have gone to Safe haven and the coffee farmers if the liquidators accepted Justice Sykes' original judgement.
However, the liquidators had, up to then, received only J$427 million "from the two large reinsurance policies", suggesting that they would have to dip into the other funds that are tightly held by regulators to meet the payments.
The Cayman Islands Monetary Authority (CIMA) currently holds J$124.5 million which it plans to pay strictly to Cayman policyholders, unless Jamaica's financial Services Commission (FSC) agrees to share with Caymanian policyholders the J$330 million it holds distribution to Jamaican claimants.
What would be left would also be eaten up significantly by liquidation costs, which represented one and half times the money paid to creditors. The liquidators, lawyers and rent among other things cost near J$200 million compared to the J$129 million paid out to Dyoll Creditors in a first interim dividend payment back in May.
That payment reduced liabilities to J$1.26 billion as at the end of last September.
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published: Friday | February 9, 2007
Camilo Thame, Business Reporter
Several acres of Blue Mountain coffee growing on a farm owned by the Wallenford Coffee Company. Dyoll liquidators are trying to settle the coffee case with 6,000 farmers instead of fighting appeals. - Colin Hamilton/Freelance Photographer
The liquidators winding up the Dyoll Insurance Company say they want to negotiate a settlement, rather than fighting at appeal, a lower court ruling that nearly 6,000 Jamaican coffee farmers should be the sole beneficiaries of US$3 million expected from foreign re-insurers for crops damaged by Hurricane Ivan in 2004.
But John Lee, senior partner in the accounting firm of Pricewaterhouse- Coopers, who is one of the two court-appointed liquidators, say they have been unable to tie down the coffee group to a serious exploration of settlement.
"The joint liquidators have tried repeatedly on numerous occasions since November to meet with Coffee Trustees," Lee told the Financial Gleaner.
Lee, on the face of it, may be finding support from the Jamaica Agricultural Society (JAS), whose president, wants the Public Defender to help steer the parties to a settlement.
"I had discussions with the public defender to the get two parties to the table," Grant said. "He has expressed willingness to make himself available. It is important that someone of that office intervene to bring finality to the matter. US$3.2 million is there, out of which substantial legal fees he been paid, while the coffee farmers, in the meantime, are suffering."
Pool the money
The liquidators, Lee and Kenneth Krys of of the Cayman Island firm, RSM Cayman, had argued that the cash, rather than going only to the coffee farmers, should be part of a pool to benefit all Dyoll policy holders who would have taken a hit when the insurance company under the weight of its Ivan-related claims.
If the liquidators win at appeal, which could a protracted and expensive battle, the farmers, it is estimated would be entitled to between US$1 and US$1.5 million of the reinsurance payment. However, Lee and his partner have suggested that the disputing should short-circuit the process, and negotiate a settlement along the lines between the agreement arrived at between the liquidators, Safe Haven, a Cayman Island golf club that was in similar position as the Jamaican coffee farmers.
The lower court had ruled that the US$8 million expected from the reinsurers for damage to that property, belonged to Safe Haven, controlled by the Jamaican Matalon family.
But rather than wade through the appeal, which could reach as far as the UK-based Privy Council, racking up big payments to lawyers, Safe Haven negotiated a settlement. However, Lee declined to disclose the specifics of the agreement, including how much cash Safe Haven would get.
In the original ruling, Jamaican Justice Brian Sykes, held that Dyoll was not the primary insurer for either Safe Haven of the coffee farmers and had only lent its name to legitimise the transactions they had with other insurers.
Lawrence Jones of law firm DunnCox, which represent the coffee trustees, told Financial Gleaner that he was awaiting instructions from his clients. He declined to comment on their likely position on a negotiated settlement.
The issue was apparently discussed at the trustees' monthly meeting on Wednesday, but there has been no public statement on any decision arrived at.
The JAS' Grant, who heads the Mavis Bank coffee factory, warned that a drag out contest could, in the end, leave coffee farmers empty-handed.
"If it is prolonged the farmers may get nothing at the end of the day," he told the Financial Gleaner. "Someone needs to step in to bring closure to the issue. My understanding is that it could take up to three years to conclude.Ó
As at September 30, 2006, just under $1 billion was accounted for on Dyoll Insurance's books as well as in amounts held in trust by regulatory authorities Ñ h in Jamaican and Cayman, to pay claims Ñ to pay winding up claims. That sum included the combined US$8 million (J$740 million) that would have gone to Safe haven and the coffee farmers if the liquidators accepted Justice Sykes' original judgement.
However, the liquidators had, up to then, received only J$427 million "from the two large reinsurance policies", suggesting that they would have to dip into the other funds that are tightly held by regulators to meet the payments.
The Cayman Islands Monetary Authority (CIMA) currently holds J$124.5 million which it plans to pay strictly to Cayman policyholders, unless Jamaica's financial Services Commission (FSC) agrees to share with Caymanian policyholders the J$330 million it holds distribution to Jamaican claimants.
What would be left would also be eaten up significantly by liquidation costs, which represented one and half times the money paid to creditors. The liquidators, lawyers and rent among other things cost near J$200 million compared to the J$129 million paid out to Dyoll Creditors in a first interim dividend payment back in May.
That payment reduced liabilities to J$1.26 billion as at the end of last September.
[email protected]
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