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Judge Warns Cca: Baha Mar Chairs Injunction 'Rare'

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Baha Mar's contractor has been warned by a Florida judge that it is "rare" to obtain the injunction it views as vital to hitting the $4.2 billion project's October 15 completion date.

China Construction America (CCA) Bahamas, in new legal filings on Friday, piled on the rationale for why it, Baha Mar and the Bahamas will suffer "irreparable harm" if it fails to get its hands on 1,420 lounge chairs intended for the project.

The Chinese state-owned contractor this time cited Baha Mar's forecast economic impact, and the project's importance to the Bahamas' sovereign creditworthiness, as additional reasons - along with damage to its own reputation - as to why Florida-based Source Outdoor should be compelled to hand over the chairs.

CCA Bahamas sought to buttress its case after the judge hearing the matter suggested it was difficult for the contractor to obtain the injunction it is seeking on the basis of "irreparable harm".

"During the telephonic hearing on July 12, 2017, the magistrate judge suggested to the parties that injunctive relief is a contract dispute was a somewhat 'rare' occurrence," CCA and its US attorneys conceded.

"That is, the irreparable harm requirement for injunctive relief is difficult to establish."

CCA is seeking an injunction where the south Florida federal court would order that the 1,420 chairs be "delivered immediately" to its Miami-based freight forwarder for onward shipping to the Bahamas.

Given the doubts expressed by the judge, CCAs attorneys rapidly went to work on finding case histories to support their case, as well as embellishing the 'irreparable harm' that it will suffer.

"The project for which the chairs are intended is 'one of the most significant single phase resorts currently under development in the western hemisphere'," CCA noted in its legal filings. "Once completed it will generate nearly 5,000 jobs and its projected to have an annual payroll in excess of $130 million, representing 12 per cent of the GDP of the Bahamas.

"It is expected to have a significant impact on the bond rating of the Government of the Bahamas." Strangely, CCA's legal filings made no mention of the recent 'downgrade review' imposed by Moody's, which could cause the Bahamas to suffer a second cut to 'junk' within an eight to nine-month period.

The contractor, though, continued to be exercised by the potential fall-out to its reputation, which has already taken a battering in the eyes of many Bahamians after it missed numerous Baha Mar completion deadlines under former developer, Sarkis Izmirlian, resulting in the eventual Chapter 11 bankruptcy protection filing and bitter legal dispute.

"Failure of CCA to complete this aspect of the project would result in intense scrutiny and unprecedented derogatory publicity directed at CCA at the peak of the Bahamian tourist season," the contractor warned.

"CCA is contractually obligated to provide the chairs to the project for which they are intended by October 15, 2017. Failure to provide the chairs by this date exposes CCA to liquidated damages of $150,000 per day, escalating to $250,000 per day.

"It is not possible to calculate in monetary terms the damage to the reputation of a major construction firm it it is unable to meet the terms of its agreement with the owner of a project of this size, importance and economic significance of the Baha Mar development. A project heavily scrutinised by the Government of the Bahamas, by the bond rating agencies, by the press and the populace."

CCA appears to have placed itself in this position by admitting that it "assumed responsibility for the procurement and delivery of furniture, fixtures and equipment" for the $4.2 billion project. This means it will not hit 'substantial completion' until the promised lounge chairs are delivered.

Edison Sumner, the Bahamas Chamber of Commerce's chief executive, previously told Tribune Business he had been reassured by Baha Mar's prospective new owners, Chow Tai Fook Enterprises (CTFE), that CCA's dispute would have no impact on the resort's next opening phases or operations.

These include the opening of the SLS Lux property in October 2017, followed by completion and opening of the Rosewood in time for March/April 2018 and the peak winter tourism season.

Source Outdoor is allegedly withholding the lounge chairs as 'leverage' to force payment of pre-Chapter 11 debts owed to it by Baha Mar.

CCA is alleging that it has no responsibility for these debts, and that these have no connection to the $390,500 chairs shipment, which it has already fully paid for. Yet the Chinese contractor's lawsuit makes no mention of its role in the Baha Mar creditor payout process.

Instead, CCA is alleging that Source Outdoor is now selling Baha Mar's lounge chairs "on the open market" in a bid to recover debts owed by Mr Izmirlian prior to the ill-fated bankruptcy protection filing in the US courts.

Comments

DillyTree 4 months, 1 week ago

Litigation for 1400 damn lounge chairs????????????????

CCA needs to get on with it and stop making excuses. Now we see exactly what Sarkis had to put up with and what slime he had to deal with. Wonder how the new "owners" feel about all this.

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Sickened 4 months, 1 week ago

I can't wait to sit my ass down in one of these lounge chairs. Based on the final cost of these things they are going to be the most expensive lounge chairs ever.

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ThisIsOurs 4 months, 1 week ago

Let us know when you going, maybe we can make it a group event

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Well_mudda_take_sic 4 months, 1 week ago

It is CCA and RED CHINA that are causing the Bahamas irreparable harm. Who in the hell elected CCA and RED CHINA to talk on behalf of the Bahamas government and the Bahamian people to the U.S. courts about irreparable harm to our sovereign creditworthiness?!! CCA and RED CHINA were not elected by Bahamian voters to speak for the Bahamas. What gives them the right to drag our government (and our country) into what should be a private legal dispute between them and a U.S. supplier?!! Just who do they think they are using our government to leverage their own interests?!! If CCA and RED CHINA cannot make good on their commitments to the Bahamian people as regards the "true" completion and opening of Baha Mar, then we should have every right to re-visit the outrageously generous (and in some instances unreasonable) concessions they extorted by hook and crook from the previous corrupt Christie-led PLP government. It is CCA and RED CHINA who are a clear and present danger to the national security interests and sovereignty of the Bahamas. Minnis and Symonette had better get a handle on this pronto before Bahamians have good cause to think our newly elected FNM government has out sourced the governance of the Bahamas to RED CHINA and its controlled enterprises!!!

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djgross 4 months, 1 week ago

How about you pay people what they're owed? I am one of 200+ expat former Baha Mar employees who are still waiting to be paid owed salary and severance. Bahamians employees were all paid. This discrimination against foreign companies and workers is wrong. It also appears to be Government of Bahamas sanctioned.
In this case it appears that what goes around comes around. The company was not paid what is still due. How can CCA say that missing this deadline would cause it irreparable harm? It intentionally slowed down work when it missed opening previously. What good reputation?

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Gotoutintime 4 months, 1 week ago

This is what happens when you screw all the foreign companies and individuals, who because they were not Bahamian, got the shaft----The Bahamas has no reputation to lose!!

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Bonefishpete 4 months, 1 week ago

WTF, Bahamas told Izerman he had no standing in US Courts. CCA telling Florida Judge, Give me the chairs. GTFO

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happyfly 4 months, 1 week ago

you damn right. wasnt this the same same point where Perry and Freddy boy and all them swooped in talking about national sovereignty and put the entire project in to receivership over some unpaid light bills....unpaid lounge chairs way worse.

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killemwitdakno 4 months, 1 week ago

They'll get chairs at their head.

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ThisIsOurs 4 months, 1 week ago

I'm lost after 13 years of missed deadlines and shoddy work, why would you set another deadline that's impossible?

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killemwitdakno 4 months, 1 week ago

Ummmm how about INJUNCTION RELIEF from CCA to deliver the hotel immediately to avoid reputable harm because THAT ALREADY HAPPENED!

CCA and PLP thought screwed American interest was going to play dead? 😆😆

I can hear Sarkis getting paid back in amounts of $250 thousand a day.

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killemwitdakno 4 months, 1 week ago

They're mad that they have no seats in the house which they thought they paid for.

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killemwitdakno 4 months, 1 week ago

Look how they won't even round it out to 4.

Fishy fishy fishy. Risking $250k a day instead of finding other $390,500 chairs and suing the supplier for it later.

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killemwitdakno 4 months, 1 week ago

CCA should have charged CEXIM for human trafficking when they weren't paid 3 months.

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killemwitdakno 4 months, 1 week ago

They're trying to find legal recourse, trying to pass the buck because it's coming.

Is there yet another reason it's unfinished that we don't know about? Has the place been fully inspected since the hurricane?

They're in far worse debt if it can never open and profits were lost which would have been generated prior had it opened before potential storm damage.

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proudloudandfnm 4 months, 1 week ago

CCA should be ejected from the Bahamas. Crooked as the PLP and just as useless...

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sheeprunner12 4 months, 1 week ago

I agree with you ........... The FNM government needs to nationalize the frigging Fook Hotel right now!!!!!! ......... Case in point - how many of the CYG delegations are staying at Bahamar??????? ........ This place is a farce ...... and a bargaining chip for the Chinese Government to blackmail our government ......... Kick their Fookin ass out of here!!!!!!!!

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sangeej 4 months, 1 week ago

Is this why the Point is standing still, what has the PLP done to the Bahamas???

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ConchyJ 4 months, 1 week ago

Bad Karma!! This place will never open. Christie thought siding with the Chinese and screwing American workers and vendors was a good idea?? What a moron!! Where do you think all those tourists come from? Hopefully, no US citizens will visit that joke of a property with their fake owners an no lounge chairs. Shame on CCA, shame on EXIM Bank. shame on the Chinese and Bahamian governments that allowed this travesty of justice. You should be begging Sarkis to take this over and make amends to the US people and companies that you screwed over!!

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