Govt. terminates BK, Courtney Benn’s school contracts totaling $1.1B

After failing to meet their contract obligations, thereby costing taxpayers millions of dollars, the government yesterday exercised its right to terminate two multi-million school contracts which were awarded to Brian Tiwari’s BK International Incorporated and Courtney Benn Contracting Services.

The Minister of Legal Affairs and Attorney General (AG), Anil Nandlall, this morning dispatched letters to the Company Secretary of both of the local contractors for the construction of the $352M St. Rose’s High School and the $827M Yarrowkabra Secondary School.
In the letter dispatched to Courtney Benn’s Company Secretary, the AG reminded that the Ministry of Education (MOE) had awarded the $352M St. Rose’s contract to Courtney Benn on August 8, 2018, with completion projected on or before April 8, 2020.

“The Government of Guyana,” AG Nandlall wrote to the Secretary, “then executed an addendum to the contract dated the 23rd December, 2019 to facilitate the driving of piles by your company. The contract was extended for a period of 20 months and is now scheduled to be completed by 23rd August, 2021.”
The official went on to indicate that the contract sum was then increased to the sum of $412,340,357. Despite the fact that Courtney Benn Contracting was given the contract to construct this state-of-the-art school two years ago, the company has only managed to complete 9% of the schedule of works, the letter said.
“As a consequence,” it continued, “your company has committed a fundamental breach of the terms of the contract and as a result thereof, the Government of Guyana hereby exercises its right to terminate the contract with immediate effect.”
This contractor’s termination was grounded on the breach of Clause 40.2 (a) for failing to comply with the schedule works; as well as the breach of Clause 40.2 (g) read along with the special conditions of the contract for inordinate delay in the completion of works under the contract.

Kaieteur News had reported in September that an advancement of $60M was issued towards Courtney Benn for this school’s construction. However, shortly after the initial stages of a pile-driving exercise begun in January 2020, the school’s Board of Governors observed that the contractor had abandoned the site. In fact, the school’s board reported that the contractor had removed all of their construction gear and personnel from the Camp and Church Streets site, and was keen to note that no explanations were given to them by the contractor for their abandonment.

With regards to BK International, it was recalled that the $827M contract was awarded through the MoE on December 31, 2019. Despite the law preventing the government from signing contracts after mid December, the former A Partnership For National Unity + Alliance For Change (APNU+AFC) regime nonetheless illegally went ahead and awarded the contract. It was signed on January 7, 2020 with completion projected for March 12, 2021.

Even with receiving a $214M advance, the AG made it explicitly clear that only 5% of the scheduled works have been completed. Similar to Courtney Benn’s case, the AG Nandlall indicated that BK International has committed a “fundamental breach of the terms of the contract”, with the government terminating the contract with “immediate effect”.

The grounds for BK’s termination were akin to those of Courtney Benn Contracting. Notably, these two contractors will not walk scot free, as AG Nandlall made it clear that the government will impose the enforcement of 10% of the contract sum as liquidated damages. Further to this will be the surrendering of the performance security as consequence of the two company’s “fundamental” breach of the contracts.
The government reminded the contractors that it reserves its right to institute legal proceedings against the two companies for compensation for their breach of contract. Both BK International and Courtney Benn Contracting Services were requested to have the sites of the two schools cleared “immediately.”