Govt seeks talks with Hopewell over court compensation order

By The Nation

 

 

The government said yesterday that it would consider negotiating with Hopewell (Thailand) Co to settle the Bt11.88 billion compensation awarded by the Supreme Administrative Court.

 

The court upheld an arbitration committee’s ruling in favour of Hopewell whose concession contract for a Bt80-billion elevated road and rail project in Bangkok was scrapped in 1998.

 

Deputy Prime Minister Wissanu Krau-ngam said negotiations could lead to a lower compensation amount, as the court’s verdict against the Transport Ministry and the State Railway of Thailand (SRT) is regarded as final.

 

The Transport Ministry is expected to form a committee to study the court’s verdict and submit details to the Cabinet for consideration, according to Wissanu.

 

The deputy PM declined to comment on whether legal action could be taken against former politicians who had caused damage to the state, resulting in the massive compensation won by the private company. He also dismissed the possibility of using special powers under Article 44 of the charter to resolve this issue.

 

However, Wissanu said there could be negotiations with Hopewell to settle the issue, adding that it would likely take a lot of time before a final decision is reached.

 

 

Meanwhile, Prime Minister Prayut Chan-o-cha said his government was not responsible for the long-standing dispute with Hopewell, but understood that there had been negotiations with the firm in the past to settle the issue.

 

SRT acting governor Voravuth Mala said public prosecutors will have to study details of the court’s verdict before the agency takes further action, after it was ordered to pay the compensation to Hopewell.

 

Sawit Kaew-wan, head of SRT’s union, said the agency does not have the financial resources to pay the entire compensation amount so the government will have to share its responsibility.

 

The Hopewell project, officially known as Bangkok Elevated Road and Train System, was highly controversial when then-transport minister Montri Pongpanich signed the Bt80-billion concession with Gordon Wu, head of Hopewell, back in 1990. Later the project ran into serious financial and technical problems leading to the termination of its concession contract about seven years later when construction work was only 13.7 per cent completed.

 

According to the 30-year concession contract, Hopewell was supposed to have completed 89 per cent of the overall construction work at that stage, hence the Chuan Leekpai government decided to terminate the contract.

 

Based on the concession contract, Hopewell was required to pay a total of Bt50 billion in fees to SRT in return for the right to collect revenues from the project’s tollways and community train service as well as develop 2,093 rai of SRT land.

 

However, the contract had many weaknesses, especially regarding the SRT’s right to end the contract when the private firm could not meet the terms and conditions.

 

The SRT also faced problems in handing over land plots to Hopewell, as many sites were still occupied by illegal residents. Later, the private firm also had financial and liquidity problems, resulting in work stoppage and isolated pillars along Bangkok’s Vibhavadi Rangsit Road.

 

The entire project was to consist of 60km of an elevated road and train network. The first section was to have been 18.8km long, running from Yommaraj to Don Muang, while the second section was to have been 18.5km long, from Yommaraj to Makkasan/Chao Phya River.

 

Construction work on these two sections was supposed to have been completed within 4-5 years, but actual work was far behind when the contract was terminated.

 

Source: http://www.nationmultimedia.com/detail/national/30368160

 

-- © Copyright The Nation 2019-04-23

"Deputy Prime Minister Wissanu Krau-ngam said negotiations could lead to a lower compensation amount, as the court’s verdict against the Transport Ministry and the State Railway of Thailand (SRT) is regarded as final."

 

Can't see what there is to negotiate... unless the government doesn't have enough spare cash to pay up on time!

 

 

2 hours ago, webfact said:

Govt seeks talks with Hopewell over court compensation order

yes no problem we can talk - pay the money first Krup

 

I feel an ART44 coming 

3 hours ago, webfact said:

The government said yesterday that it would consider negotiating with Hopewell (Thailand) Co to settle the Bt11.88 billion compensation awarded by the Supreme Administrative Court.

Good luck with that The judgement does not mention interest for two decades of not paying the original verdict. The negotiations probably should have started then, but then again, the Supreme Administrative Court did not follow the expected outcome.

 

3 hours ago, webfact said:

SRT acting governor Voravuth Mala said public prosecutors will have to study details of the court’s verdict before the agency takes further action, after it was ordered to pay the compensation to Hopewell.

 

Sawit Kaew-wan, head of SRT’s union, said the agency does not have the financial resources to pay the entire compensation amount so the government will have to share its responsibility.

2 interesting points here.

1) The SRT had not made provision for a large debt hanging over their head/books in spite of the original decision almost 20 years ago.

2) As a result of not following modern accounting practices the SRT is going to need bailing out. One or two of the cash splashes by the PM during the election might not happen, or be deferred till the next election.

3 hours ago, webfact said:

Deputy Prime Minister Wissanu Krau-ngam said negotiations could lead to a lower compensation amount, as the court’s verdict against the Transport Ministry and the State Railway of Thailand (SRT) is regarded as final.

 

The Transport Ministry is expected to form a committee to study the court’s verdict and submit details to the Cabinet for consideration, according to Wissanu.

 

As in, we don't want to pay, we never wanted to pay, so even if a "final Judgement" lets negotiate. The never ending clown show.

57 minutes ago, smedly said:

yes no problem we can talk - pay the money first Krup

 

I feel an ART44 coming 

Exactly.

 

The Chinese (Hong Kongers) want their money, and know all the Thai tricks as they are all cousins! 

Reuters article is much better written, of course, than the local media articles. 

3 minutes ago, Fex Bluse said:

Reuters article is much better written, of course, than the local media articles. 

Reuters journalists not risk prison

23 minutes ago, ICELANDMAN said:

Reuters journalists not risk prison

We can also say Thailand journalists lack courage 

So, in Thailand's world, losing parties can "consider negotiating"?

 

I think you might find the Winners control that option.

 

Perhaps you should have "negotiated" that 20 years ago, paid a fair compensation and avoided looking like arrogant fools now, when you have no money to pay.

 

 

4 minutes ago, DLock said:

So, in Thailand's world, losing parties can "consider negotiating"?

I think you might find the Winners control that option.

Perhaps you should have "negotiated" that 20 years ago, paid a fair compensation and avoided looking like arrogant fools now, when you have no money to pay.

I predict no money will ever be paid.

In Thailand the winners are always the guys with all the tanks and guns.

7 minutes ago, DLock said:

So, in Thailand's world, losing parties can "consider negotiating"?

Like Brexit you mean?

Well, see what happened to the Don Muang Tollway dispute 8 years ago.. 

8 minutes ago, kotsak said:

Well, see what happened to the Don Muang Tollway dispute 8 years ago.. 

Didn't someone get their wings clipped over that one ????

Edited April 23, 20197 yr by Soupdragon

3 hours ago, bangkokfrog said:

"Deputy Prime Minister Wissanu Krau-ngam said negotiations could lead to a lower compensation amount, as the court’s verdict against the Transport Ministry and the State Railway of Thailand (SRT) is regarded as final."

 

Can't see what there is to negotiate... unless the government doesn't have enough spare cash to pay up on time!

 

 

Just cancel a few of those submarines and things will be good.

Short-sighted. Thais rarely think of the future. By trying to renege on compensation, the government will find it either can't get contractors for public works, or the ones that do will be bottom-feeders and/or charging a big risk premium.

Now they want to talk. After the billion dollar judgment against them. 

 

What are chances they actually pay up? 

It's a great place to invest, so they say.

What part of final decision doesn't the government understand? A final decision means no further negotiation is possible, but as usual in Thailand the law as laid down by the courts only applies to others and not them.

As I wrote elsewhere, just sell off the enormous area of wasteland that is owned by SRT at Makkasan and that will not only pay off the debt but finance the modernisation of a rail system that is many decades out of date.

Brilliant graphic by The Nation, by the way.

1 hour ago, inThailand said:

Now they want to talk. After the billion dollar judgment against them. 

 

What are chances they actually pay up? 

Not bad, they will pay when the kings plane is being detained at Munich airport. It would not have been the first time either.

Maybe the M6 half teetering over much of the M2 will be next? 

3 hours ago, ICELANDMAN said:

Reuters journalists not risk prison

Tell that to the two in jail in Myanmar

2 hours ago, inThailand said:

Now they want to talk. After the billion dollar judgment against them. 

 

What are chances they actually pay up? 

Nil

Montree, who was minister of transport in the Chatchai “buffet cabinet” was in a rush to pocket the money from Hopewell and drafted a contract of only a few pages covering the broad brush with copious critical details to be filled in later. One important detail that Wu overlooked was that in haste and eagerness to pocket the whole pot, Montree had cut out SRT’s mafia top brass from the negotiations and the gravy. As a result, Wu was blocked by SRT at every turn when he attempted to build the thing, although he soldiered on until he ran out of cash.

 

Not long after the contract had been signed there was a coup and Montree scuttled off and died of AIDS.

Edited April 23, 20197 yr by Dogmatix

Mahmood on a Moped, is this still going on? Gotta admire the Thais, nobody can string things out like they can when it comes to compensation - cf. the Saudi gem theft.

6 hours ago, BritManToo said:

I predict no money will ever be paid.

In Thailand the winners are always the guys with all the tanks and guns.

Not necessarily so. Sell the debt to a German company. The 

Germans have an unique way for getting debts from Thailand settled

compensation or a few tanks ? tanks win

It is ironic that the rent seeking behavior of the folk at SRT who were angry at not getting paid off that led them to find ways to stall them had project when Hopewell still had money to build it has now led to a massive fine forSRT.

Just pay up Prayuth or face contempt of court charges

Negotiations mentioned by Wissanu will be, “How about you foreigners take a 90% discount on your settlement and we promise that you will get another project in future?”

 

Seems like the Thai side is in a weak negotiating position. The time to negotiate would have been before going to court. Now that Hopewell has ground through the Thai courts for two decades and got the judgement they wanted, what is left to negotiate.