Government Proposed 21-Year Lease Of Reclaimed Crown Land To Peter Nygard
By NEIL HARTNELL
Tribune Business Editor
nhartnell@tribunemedia.net
The Government proposed a 21-year lease of reclaimed Crown Land at Nygard Cay to its fashion mogul owner, with an annual rental rate pegged at $25,000.
Documents
obtained by Tribune Business reveal that the Christie administration
sought to justify the lease on the grounds that it was needed to support
an “estimated $50 million touristic development” at Nygard Cay.
The
August 3, 2012, letter from Richard Hardy, the Department of Lands and
Surveys’ acting director, provides the first concrete confirmation that
the Government was assessing its options for granting a Crown Land lease
- the issue at the heart of recently-launched Judicial Review
proceedings.
The
letter, described as a Memorandum, does not go into detail about the
nature of the tourism project proposed by Peter Nygard for his Lyford
Cay property.
However,
the $50 million sum referred to matches the figure discussed at a
meeting between Mr Nygard and Bahamas Investment Authority (BIA)
officials, which was held two months’ prior to Mr Hardy’s letter.
Previously
obtained notes of that June 2012 meeting revealed that Mr Nygard was
proposing a $25-$30 million investment to rebuild his fire-destroyed
Nygard Cay home, with the balance earmarked for a stem cell research and
treatment facility targeted at medical tourism. It would thus appear
this proposal is what Mr Hardy is referring to.
Mr
Hardy’s memorandum, addressed to the permanent secretary in the Prime
Minister’s Office, and which bears the director of investments’ (Joy
Jibrilu) stamp, dated August 15, 2012, is headed: ‘ Proposed Lease of
Land at Nygard Cay for a proposed touristic development’.
Referring
to an August 1, 2012, missive he had received, containing two proposed
“plans”, Mr Hardy disclosed that the minister responsible for Crown
Lands - who is Prime Minister Perry Christie - had decided to lease a
portion of the reclaimed seabed at Nygard Cay to Mr Nygard.
“It
is noted in your second paragraph that the Minister Responsible for
Crown Land has determined that appropriate acreage should be leased to
Mr Peter Nygard to facilitate the proposed estimated $50 million
touristic development,” Mr Hardy wrote.
Referring
to one of the lease options presented to him, Mr Hardy said the “area
coloured red is recommended on a 21 years renewable lease basis, at an
annual rental of $25,000, (with reviews after seven and 14 years)”.
The Lands and Surveys acting director then effectively confirmed the acreage involved was Crown Land reclaimed from the sea.
He
added: “In effect, this recommendation is in respect of the property
between the December 1984 high water mark and the June high water mark.
“It
does not include those areas..... which are covered by water (other
than the northern lagoon) and are tidal, i.e. (4.779 acres minus tidal,
non-lagoon, areas).”
A
handwritten note at the bottom of Mr Hardy’s letter says a proposal was
expected imminently, and that all these details “should factor into
Cabinet/National Economic Council papers”.
While
there is no evidence to suggest that the Nygard Cay lease was a ‘done
deal’, the contents of Mr Hardy’s letter are likely to reignite the
controversy surrounding its Canadian owner’s construction endeavours.
This
is because the Save the Bays coalition, in its Judicial Review action,
is challenging the Government’s alleged failure to prevent “unauthorised
development” at Nygard Cay - the same development it claims has
resulted in the seabed reclamation subject to the Crown Land lease.
In
effect, if the coalition’s allegations are correct, the Christie
administration’s plan to lease the reclaimed Crown Land to Mr Nygard,
under cover of facilitating a tourism development, would be tantamount
to legitimising/sanctioning wrongdoing.
Mr
Nygard has argued that his Simms Point property has expanded through
natural accretion, but this has been dismissed by both Save the Bays and
the former Ingraham administration.
In
the Attorney General’s draft defence and counterclaim, filed in
response to a legal action initiated by Mr Nygard, the former government
sought a court declaration that the Canadian fashion mogul had
unlawfully “trespassed” on Crown Land through his construction
activities.
Implying
that Mr Nygard lacked the relevant permits and approvals, the Attorney
General’s Office had also sought a court Order requiring Nygard Cay’s
owner to remove - at his own expense - all the groins, docks and seabed
infilling he has allegedly carried out, thus returning the coastline to
its original 1984 boundaries.
The
Christie administration’s Crown Land lease proposals thus represent a
stunning U-turn on the position taken by its predecessor within three
months of the 2012 general election. The $25,000 annual lease payment,
which over 21 years would amount to a collective $525,000, also pales
into insignificance alongside both the Government’s fiscal deficit and
the alleged $25-$30 million valuation Save the Bays has placed on Mr
Nygard’s reclaimed Crown Land.
And
the coalition had previously warned that granting Nygard Cay’s owner
his much-desired lease would set a bad precedent, sending signals to
Bahamian and other foreign landowners that they could ‘do as they
pleased’ with respect to developing their properties without reference
to existing laws and regulations.
Further
evidence that the Government was contemplating a Crown Land lease to Mr
Nygard is contained in the August 16, 2013, affidavit by Hyacinth
Smith, an attorney in the Attorney General’s Office.
The
affidavit, sworn in support of the Government’s bid to have Save the
Bays’ Judicial Review action thrown out, refers to “the consideration of
any lease options by the Government” in relation to Nygard Cay.
Other
documents filed in support of the Government’s application, though,
have also revealed previously unknown facts related to the Nygard Cay
situation.
- The former Ingraham administration obtained two $2.7 million-plus bids from construction firms to return Nygard Cay’s size, and coastline, to 1984 conditions. The work, it told Mr Nygard, would have to be paid by himself.
- The Christie administration issued Mr Nygard an annual dredging permit, via the Department of Lands and Surveys, for the period June 13, 2012, to March 12, 2013. The issuance came just six weeks after the general election.
A
transcript of the court hearing at which Save the Bays obtained
permission to file its Judicial Review action saw its attorney, Fred
Smith QC, disclose the contents of a January 9, 2009, letter sent by the
then-government to Mr Nygard.
Referring
to talks with the fashion mogul’s then-attorney, Sidney Collie, the
Government said it was its “intention to cause the coastline at Simms
Point... to be reinstated”.
It
added: “The Government has sought and obtained bids from two suitably
qualified firms, Tycoon Management and Bahamas Marine Construction, in
the amount of $2.75 million and $2.73 million respectively, to undertake
the proposed reinstatement work.
“The
two bids are being reviewed, and you will be advised of the successful
bid shortly. It is the Government’s determination that the full cost of
the work be borne by you.”
Tycoon Management is headed by James Curling, while Bahamas Marine is part of the Mosko Group of Companies.
Ms Smith’s affidavit for the Government, though, questions the “bona fides” behind the Save the Bays’ Judicial Review claim.
She
alleges that the action is nothing more than the latest extension of
the battle between Mr Nygard and his Lyford Cay neighbour, hedge fund
billionaire Louis Bacon, who is a prominent member of Save the Bays.
This,
she added, “throws doubts on the bona fides of the Judicial Review
claim”. And the application’s reference to the Bahamas Investment
Authority meeting “speak clearly to the collateral interest of the
coalition in opposing the consideration of any lease options by
government with respect to the Nygard Cay matter, and a stem cell
facility connected to Mr Nygard”.
All
three of the Government, Mr Nygard and the latter’s attorney, Keod
Smith, are seeking to have the Judicial Review action dismissed on legal
technicalities.
For
example, the Attorney General’s Office and Mr Smith are alleging that
in obtaining leave to file its Judicial Review action at a hearing where
only it was present, Save the Bays and its attorneys failed to properly
disclose all material facts relevant to the case.
Indeed, Mr Smith’s summons blasted those behind the Judicial Review action as “busybodies with misguided complaints”.
Mr
Nygard, for his part, wants the injunction halting all further
construction works at Nygard Cay thrown out on the grounds that he is
not a public official or body subject to Judicial Review. He is also
seeking damages for the injunction.
And the Attorney General’s Office has blasted the document discovery order imposed on the Government as a “fishing expedition”.
April 26, 2013
