NASSAU, BAHAMAS- A Supreme Court judge has granted both the embattled Lucayan Towers South Condominium Association (LTS) and the Grand Bahama Utility Company (GBUC) favorable outcomes on certain points in their ongoing legal dispute concerning water and sewerage services and outstanding fees while noting that there was no “outright win” for either side.
In his March 31st decision, among his several conclusions, Justice Loren Klein issued a six-month stay on the disconnection of water and sewerage services, while also acceding to GBUC’s counterclaim in quantum meruit, determining that the arrears owed by LTS, as calculated from the date claimed to the judgment date, totaled $427,878.49.
The Lucayan Towers South Condominium Association, a licensee of the Grand Bahama Port Authority (GBPA) and the body responsible for managing the condominium has been embroiled in litigation since 2013, primarily due to issues with its management board. The ongoing internal conflict has severely impacted the financial stability of the association, leading to significant debts, including over $400,000 owed to the Grand Bahama Utility Company for water and sewerage services since 2014.
While LTS has acknowledged its obligation to pay for these services, it has disputed the charges, claiming they are “arbitrary, unregulated, and unreasonable” and in conflict with the terms of the Hawksbill Creek Agreement (HCA). The association initiated legal action in December 2018, initially seeking an injunction but later expanding the claim to include various declarations and orders against GBUC. Additionally, LTS brought a secondary claim against a former board member group, alleging financial mismanagement that contributed to the arrears and seeking indemnity. Despite the utility company’s efforts to enforce payment and disconnect services, the court granted injunctions to prevent disconnections, including one in October 2022.
In his ruling, Justice Klein addressed the various claims made by the condo association and made several declarations, though not in the form requested by LTS, as they did not align with the Court’s findings on the facts and applicable law.
The court granted the association a declaration recognizing their status as a licensee of the Port Authority, entitling them to the rights and privileges outlined in the Principal Agreement. However, the declaration that GBUC (Grand Bahama Utility Company) was operating as the Port Authority’s alter ego was refused, with the Court ruling that GBUC was acting as the Port Authority’s agent instead.
The court also refused to grant a declaration stating that the Port Authority could not cease providing essential services without a court order. On the other hand, the Court issued an order prohibiting GBUC from disconnecting water and sewerage services to the condo association’s property for six months.
The court declined the declaration that GBUC was not entitled to set utility fees unilaterally, but it did rule that any fees must be reasonable as per the terms of the agreement. The request to determine the reasonableness of non-potable water fees was also refused due to lack of jurisdiction.
Additionally, the court granted an order restraining GBUC from engaging in actions that could cause further harm to the Condo Association’s property, though it did not prevent GBUC from taking lawful actions to recover debt. The condo association’s claim for damages regarding the cessation of water services was rejected, as no damages had been pleaded or proven. Similarly, the claim for aggravated or exemplary damages was refused, as there was insufficient evidence to support it.
As for GBUC’s counterclaim, the court granted a claim in quantum meruit, awarding the amount of $427,878.49 for arrears, after deducting a penalty of 1.5 percent. Interest is to accrue from the date of the judgment. The parties were invited to submit written submissions on costs within 21 days of the judgment.
