Ames says he will fight to rebuild business

Dave Ames, the founder of hotel resort and property developers Harlequin, says following his victory in the High Court of Justice of England and Wales in his case against his former accountants Wilkins Kennedy, he will now focus on fighting to rebuild his business.

Last Monday, Ames was awarded damages of US$11,630,970.50, a sum far short of the US$60 million he had claimed in the case brought against the accounting firm for breaches of contract and/or duty in connection with the development of the company’s flagship project, the Buccament Bay Resort in St Vincent and the Grenadines.{{more}}

Following the judgement, Ames said outside of court: “We have lived with the failings of Wilkins Kennedy and the nightmare of this case for years. The impact their actions have had on our investors, the success of our business, our public reputation, the happiness of our family and our own health is undeniable. Wilkins Kennedy should be holding their heads in disgrace. I trusted them as my accountants, and I cannot believe they were acting behind my back to help a fraudster get away with funding a lavish lifestyle. The fact that my former accountant, Mr MacDonald, has now gone into business with that fraudster since all of this came to light shows what a conspiracy all of this has been.

“It is of no surprise that the aggressive and cynical tactics of the defendants were unsuccessful in distracting the court from the key arguments and evidence. With the sheer volume of mud that was thrown by the defendants, it was expected that some might make it to the judgment, but it was a price worth paying for today’s successful result. In fact, we are delighted the case has now resulted in such a strong judgment in favour of Harlequin and it vindicates what we have been saying for years. Today we have, at last, some justice. Tomorrow, we return to fighting to rebuild our business,” Ames said.

Harlequin’s case was that, relying on Wilkins Kennedy’s advice, they did not enter into a written contract with the construction firm ICE, which had been hired to complete the construction of the resort. Instead, they came to a very loose arrangement with ICE, and the project “ran completely out of control.”

Harlequin says that ICE’s works were delayed and, in many instances, not built at all, leading to the termination of their arrange­ment with ICE in June 2010. They blame Wilkins Kennedy for the delay and also say that they paid ICE far too much money for the work that they did, for which they also blame Wilkins Kennedy.

The judge said he has concluded that ICE was significantly overpaid and that, as against the $50,524,663 that they were paid, the proper valuation of their work was no more than $24,784,293.

“I have concluded that Harlequin were prima facie entitled to loss and damage in the sum of $23,261,941… being the amount of the overpayment to ICE, less an allowance for the cost of the valuation process. I have rejected every other claim,” the judge said.

Wilkins Kennedy had argued that “Ames’ management failures pervade every aspect of the case and that, in particular, he and/or Harlequin failed to take any or any appropriate steps to protect Harlequin Property SVG by ensuring that it entered into proper and full written contracts with Ridgeview or ICE.”

Wilkins Kennedy had sought a 75 per cent reduction in any damages awarded against them because of Ames “contributory negligence.”

According to the judgement, “the evidence is that Mr Ames received advice about the importance of a valuation process from a number of different sources…. So the failure to ensure that there was a contractually-binding valuation process was, at least in part, his responsibility too.”

Mr Justice Coulson, however, concluded that a 75 per cent reduction was too high and reduced by 50 per cent the sum he would otherwise have awarded “to reflect Harlequin’s contributory negligence.”

Hence the amount recoverable by Harlequin against Wilkins Kennedy is $11,630,970.50.

The judge, however, expressed his concern that if he did award any damages to Harlequin, “the sums ordered should be paid to the investors, rather than to the company, much less to Mr and Mrs Ames.”

“In the light of that, I concluded that the appropriate course might be to order that the $11,630,970.50 should be paid into some form of escrow account, in order that the position as between the investors and Harlequin SVG could be properly resolved.”

Last Wednesday, the Buccament Bay Resort was effectively shut down when VINLEC, this country’s lone supplier of electricity, cut off the resort’s supply for non-payment. The approximately 30 guests on the property were forced to seek alternative accommodation or flights out of the country.

The resort had been operating on a skeleton staff since Friday, December 2, when the majority of employees went on strike, demanding that they be paid the more than two months wages and salaries they were owed.

Some employees say that Ames had repeatedly promised that the workers would be paid when he won his US$60 million claim against Wilkins Kennedy.