Contract not signed but ‘Suez could sue’
Wednesday 16th September 2009, 11:30AM BST.
THE States could be sued if it backs out of an incinerator deal with Suez Environnement, according to one deputy.
He and others will attend a presentation tonight from a company hoping to persuade the States to renege on its agreement to have Suez build a £93.5m. mass-burn incinerator.
Deputy Mike Hadley (pictured) said it was absurd to bring in ideas like this now.
‘Suez has won the contract through a fair and transparent process and if we were to back out of that, it would be a tremendous breach of faith – not to mention Suez could sue us,’ he said.
‘We have not signed a contract, but Suez have put a huge amount of money into tendering and if, at this stage, we changed our minds, my understanding is that they would certainly have an action because that is unreasonable.
‘They have jumped through all the necessary hoops and you cannot mess people about like that.’
Public Services would not discuss any possible liability but minister Bernard Flouquet said the Assembly’s decision to back Suez could not be set aside without restarting the whole tendering process.
‘That would send out a very negative message about the island and how we do business and it is highly unlikely that any new procurement would attract credible and reputable companies to bid,’ he said.
‘That could have very serious implications, not only on this project but also future major capital projects.’
- To read Guernsey Press stories in full click here for subscription details. Individual editions are now available online.
Island Life
All about Guernsey
Ambassador of the Year 2011
History & Heritage
Visitor Information
Guernsey's government
Campaigns
Voice For Victims
Voice for Victims is a campaign aimed at promoting the rights of those affected by child sexual abuse.
This is Guernsey
Guernsey Press
Useful Links
If, and it is an if, Deputy Hadley is right then Environment owes the people of Guernsey an explanation and answers to questions such as
Has anyone made legally binding promises to Suez?
If yes, who made these promises and what were they and on whose authority were they made.
If Suez were tendering and there was another tenderer against them, would they expect to be compensated if they lost?
The common sense answer seems to be no, unless someone has made promises, off balance sheet, as it were.
Or is Mr Hadley merely scaremongering?
Report abuse
‘Suez has won the contract through a fair and transparent process’
What a load of rubbi$h.
(Excuse the pun!)
Report abuse
Clearly Hadley and Flouquet have more than just the islands interests at stake here.
Firstly it would mean that they had to accept that the mass burn option was wrong, thereby admitting that they made a mistake.
And, as you say steven, what “off the record” promises have been made to Suez.
Their comments are laughable, as far as I can see this is a viable alternative with less environmental impact and less taxpayers money, plus the company involved only found out about Guernsey’s situation about a week before vote.
Yet our “elected representatives” are attempting to dismiss it out of hand because of either having to admit they were wrong, or some other motives.
What difference does another tendering process make, if it means saving us from Flouquets monster.
Report abuse
I’m no legal expert but perhaps someone who is could explain to us all how a company can sue a potential client for backing out before a contract is signed?
OK Suez pumped a lot of money into tendering but what if the States had turned their tender down? Would they expect that money back? Of course not! All sounds a little fishy to me.
Report abuse
true, there is no binding contract but I assume that Mike Hadley is referring to the possibility that Suez could seek judicial review of any decision to revist the tender process, now that the tender process has been completed and they have a reasonable expectation of being awarded the contract.
that said, compensation is not usually awarded for judicial review cases – usually the decision in question is quashed and the relevant public body is simply told to make the decision properly.
Report abuse
£1m – tender process
£93m – acceptable use of taxpayers’ money for unwanted incinerator unit
Cost of not losing face? Priceless.
Gutless idiots.
Report abuse
PaulLeP and TL.
I am not a lawyer but have spent many years in the construction industry and as I see it Suez have made an offer which the States of Guernsey have, in thier infinite wisdom(?) accepted. To me a contract therefore exists even though the paperwork has yet to be completed. Deputy MH may be right that to back out now may result in an action for breach of contract. However if I am wrong not doubt someone somewhere out in blogland will put me right.
Report abuse
Tim
A contract requires 4 elements to be concluded. It appears that only the first two (offer and acceptance) have arisen to date in this case. And even the ‘acceptance’ element might be a bit tenuous in itself since the States have, as I read it, merely indicated their intent to proceed with this folly rather than writing to Suez stating “we accept your proposal, please proceed” (or at least it is to be hoped they haven’t gone that far yet).
Tendering costs are not normally reimbursable. Mr Hadley refers to a huge amount of money being put into tendering by Suez, but these costs would have been incurred prior to the States debate and if the reverse decision had been arrived at then I doubt that he would have been raising this matter. Or would he? Maybe in his eyes he and his cohorts really do have egos worth £93M.
Stephen, The Man and Pah all raise good points. No doubt JLS will do so in his or her usual entertaining style in due course.
If it isn’t a done deal yet – and it certainly ought not to be – then the door can’t and shouldn’t be shut on this interesting new proposal.
Loss of face? Losing one is careless, but when you often appear to have two then that is simply crass.
Report abuse
does the phrase ‘deal with the Devil’ strike a note with anyone here…?
Report abuse
Fin
Interesting point on acceptance. However I would have thought that by now Burney would have had one of his minions at PSD to write said letter or at least a Letter of Intent, which, if so would result in a contract. Which brings me back to my original point about deputy MH’s comment. Hopefully I’m wrong.
I have always understood that there were 3 elements to a contract, consideration (93m!!!) being the third. As far as I was aware contracts do not have to be in writing to be legal. Nice discussion point but possibly drifting away from the article.
Report abuse
Mr Hadley states that Suez won the tender fair and transparent. This is a misleading statement. All tenders put forward by the Recycling Group were rejected for no reason, and the Recycling Group were then sacked. Nobody was informed on who was tendering as PSD stated it was a sensitive issue. Deputy Bell put the Recycling Group to look after & inform the public on all issues on how we were going to get rid of our rubbish. He said that it would be and open and transparent policy so that everyone knew what was happening and how the States would arrive at the desired conclusion. After PSD dismissed the Recycling Group, they went from recycling to mass incineration without informing anyone on the change of policy, and have still not given any reason or justification. It seem all along there has been only one Company bidding for the contract, and PSD has been sitting on its hands doing nothing except fend off competition. Nobody wants Mass Incineration, that’s why it was kept under tight wraps until the last moment. There are many questions that need answering by the States as to how this Company (Suez) was chosen, and how 30 odd Deputies decided to go against the will of the people to vote it in.
Report abuse
This debacle shows that it is people, as much as structures of government, that should have earned the criticism of the Welsh audit office.
Those stressing the contractual angle should be mindful that the law relating to tenders are different to the sequence of offer and acceptance, in a traditional contract.
As I understand it, and Dave Jones will no doubt correct me if needed; the States whilst accepting that the Suez proposal was the preferred approach, didn’t give approval for Environment to waste (sorry, sign a contract)for the £93 million, PR sum, when the real cost will be around £250 million.
Funny that the normally publicity grabbing Deputy Hadley has failed to answer my initial questions
“Has anyone made legally binding promises to Suez?
If yes, who made these promises and what were they and on whose authority were they made”.
Report abuse
Well, reading through those postings I find that all have a good reason for writing as they have done,
However if they the States have made gestures amounting to an acceptance, there is nothing more to be said.
Except sack the lot of the States they are paid by their employers, the Taxpayers, therefore a dismissal for misuse of office calls for their dismissal.
Report abuse
When I lectured in Guernsey I presenterd data, the science, the economic madness of incineration and 360 journal references. All of these stand whatever rude words were stated by public health who lacked any evidence. The only safe system is plassma gasification at a fraction of the cost and yes it would take all the ruibbish going into the hospital incinerator that should be shut at once for killing and maiming the people.
Report abuse
Stephen, you have now on two occasions mentioned Environment signing contracts with Suez. I need to clarify that the contract with Suez is the responsibility of the Public Services Department NOT Environment Department.
Report abuse
Adding on to comments, “‘They have jumped through all the necessary hoops and you cannot mess people about like that.’” I can’t see how he can say that, when they’ve been messing around the public like “that” for years!!
Report abuse
I want to know where I can find the EIA that someone should have done to prove the suitability of the facility.
The “hoops” argument is rubbish. What’s good for the public is our concern. Any contracts we don’t sign is our perogative, decisions based on criteria designed to serve us rather than any reputation or relationship.
I cannot believe for one minute that the process was transparent. You only have to look at the deliberate misinformation published by PSD.
It reeked of vested interests years ago, it smells worse now.
We’re hopeless.
Report abuse
If the States do not reconsider this and opt to burn our waste instead, I for one will personally give up any and all of my spare time to picket the development until the gutless idiots concerned back down or resign.
The proposed alternative, if proved viable, would be the perfect solution. If so, let Suez sue. In the event that they are successful they would at best recoup a relatively tiny fraction of the long-term cost their solution would incur compared to what the island would pay for the alternative technology proposed.
This is THE most important issue for islanders at the moment and the States.
Report abuse
JL Seagull
Good points there.
I think we are being stitched up here good and proper, its just a pitty the whole thing can`t be investigated. I was even told 2 months before it was debated by a family member of one who has an interest in this that it was a done deal (i didn`t believe him). I know that could just be hear say but now i`m not so sure.
Report abuse
Whatever the process and cost may be of backing out of any written or verbal contractual agreements with Suez (even costs running into say 20 mill), it will be a small price to pay in the long-term in respects of both financial and health for the people of the Bailiwick.
I must say that we do have some dam good Deputies who do listen and who do act for the people. The whole suez process must be brought down from within government and it is these Deputies that the people of Guernsey should lobby now or it may just be too late to stop this massive financial toxic train of pollution and death of a mass burner regardless of size on our shores.
We read in our local paper that we have clusters of cancers in children here and in Alderney and one should ask why. We allegedly also had/have a a high rate of brain tumours in adults and ask why. We have been fed propaganda by our media over decades with regards how allegedly safe Cap de la Hague is and all our ills are purely down to our life styles………….’Oh look another flying pig so many pigs flying in the skies over one jurisdiction………..’Must be something in the air!!!!
Report abuse
What a load of tripe from so many, so I’ll just select a couple.
Tim, to say that Burney got a minion to quickly write a LOI implying, I believe some underhandedness is daft. The Billet from July clearly refers to an LOI that had been drafted and that would be signed once the States had agreed. As they agreed, presumably the letter was sent!
Mal, honestly….. I take it you mean by the Recycling Group, you mean the People’s Panel which did not submit any tenders – they were not tenderers!
Also, the majority of the Suez proposal revolves around recovering as much as possible BEFORE incineration – where’s the change in policy?
Two complete factual errors which should surely put the rest of your post in doubt. And the fact that no-one else points these out………
Report abuse
Billyfish:
The Suez proposal revolves around mass-burn incineration. The tender was for a ‘residual’ waste plant… that is the waste that cannot be recycled. The MRF at the front end should be a private enterprise, as is the case now, and not paid for by us. Also, the mass-burn incinerator will burn everything thrown into it. There will be no ‘recycling’ of the black bag waste that goes into it. It will take recyclates and all.
Report abuse
Billyfish
If you had read my previous post you would see that nothing underhand was implied, merely that I thought that in the time between the July States meeting and the date of the article (some 6 weeks) that PSD would have acted on the States decision. Expectations that civil servants/politicians would act on the decisions of The States of Deliberation may be naive but hardly daft!
Report abuse
Tim, fair enough! :)
Rosie, or should I call you Roie? The MRF, from what I can tell isn’t going to be paid by “us”, it will be paid for by users, exactly as you said a privately run MRF would be! I don’t see the difference? It IS a privately run MRF – run by Suez.
Thanks – BillyTHEfish
Report abuse
BillyTHEfish.
Part of the £93m that we (the States) are paying for the Suez plant, is going to be for the MRF plant. It is our money that is paying the capital outlay. If you have fallen for the ‘self-funding’ line, then the gate fee has to be set at a minimum of £200+ per tonne for that to be the case. That will be money that will be coming out of the Guernsey economy…. and much of it going to France.
Report abuse