Boyea, Flour Mill Dispute Heats Up Again

The Eastern Caribbean Group of Companies (ECGC) wants to increase the price of flour here and in its other markets across the OECS.

General Manager of ECGC, Dr Jules Ferdinand, confirmed this saying that it has been ten years since the last increase, while the prices of wheat and energy have been rising.

“Even when we were granted the increase we decreased prices when input prices went down,” he told SEARCHLIGHT.

The request has raised eyebrows in some quarters in St Vincent and the Grenadines because that is almost the length of time that the ECGC has been locked in a legal battle with two former employees, former General Manager, Ken Boyea, and former Financial Controller, Hudson Williams. {{more}}

They were fired in 1997 and sued for wrongful dismissal. The company counter-sued claiming damages of $58.8 million but later reduced it to $8 million for Boyea and $6 million for Williams.

The SEARCHLIGHT has learnt that the company has so far incurred about $20 million in legal costs to recover this sum and what is raising eyebrows is why should the company get a price hike when it has been paying out millions in legal costs – a question that was put to Dr Ferdinand and his attorney, Douglas Williams.

Ferdinand declined to comment. Williams could not say just how much the legal expenses had totaled so far in the near 10-year battle but he said that if the company won it is usual for the Court to factor in legal expenses in the judgment against the plaintiff, though he could not give an opinion on whether that would be so in this case.

The case brought by Boyea and Williams was put on hold while they challenged the admissibility of documents and accounting records used in the counter claim. The Court ruled last week that many sections of the KPMG Accounting Report were not admissible, neither was the entire Karl Hudson Phillip’s report. ECGC has appealed the ruling.

Permanent Secretary in the Ministry of Trade, Patricia Martin, said a request had been processed and recommendations sent to Cabinet. She would neither divulge the recommendations nor the amount the company is seeking.

Neither would Dr Ferdinand.

“I don’t want to comment too much at this time because we are still awaiting word from Cabinet” Dr Ferdinand said.

Dr Ferdinand said that St Lucia has already given a price increase. He explained that their system runs differently because the price of flour is Government controlled and is set using a tender system, which they won.

The company has however held off from implementing any increase in Antigua and Barbuda before rectifying things on the local market. The two countries were embroiled in a row because Antigua had imported flour from outside the OECS.

With this in mind, Dr Ferdinand said that no increase in Antigua will be wise if it isn’t first granted in St Vincent and the Grenadines. He further stated that the trend of flour increase is spread across the Caribbean.

“Trinidad, Barbados and Jamaica have all increased their prices.”

“Once flour goes up bread prices will have to rise” was the response of Alvin Smith of Allan Smith’s Family Bakery.

Neville Greaves of Sunrise Bakery said that there have already been increases on electricity and diesel so right now it is an uphill climb for bakeries. So once flour goes up the rise in prices will be “automatic”.