Published On: Wed, Sep 30th, 2020

Government committed: SG Brown approved Alegria’s right of long lease

PHILIPSBURG – The Court in First Instance overruled in September the government’s objections to granting a right of long lease to Alegria Real Estate. The lease agreement is about a parcel of 13,525 square meters (roughly 200 by 65 meters) of water in an area called Burgeaux Bay adjacent to the Alegria Resort. In a press release issued after the court ruling, Alegria’s attorneys stated that their client is now free invest $100 million in the development of the Morgan Resort, a project said to offer job opportunities to 500 St. Maarteners.

In the wake of the court ruling, Minister Jurendy Doran (Public Housing, Urban Planning, Environment and Infrastructure – VROMI) suspended his Secretary General Louis Brown.

The reason for the suspension is reportedly that Brown sanctioned an agreement with Alegria about the lease. On May 5, Brown wrote in an email to attorney Aernout Kraaijeveld who handled the pending injunction case for the government: “Dear Aernout, I have studied the documents and they match. We agree with it.”

A day earlier, Alegria had sent an email to confirm a settlement agreement, whereby it would withdraw its injunction. That lawsuit aimed to force the ministry to grant the right of long lease. The mail stated that the country would issue the right of long lease to the water parcel within four weeks, that Alegria would pay the relevant fees at the Cadastre office and that the company would withdraw its injunction. Attached to the email was an unsigned and undated document – the draft decision by the minister of VROMI to grant the right of long lease.

Attorney Kraaijeveld was not convinced. He reported to Brown that Alegria refused to accept an earlier proposal from the ministry. “They have made their own proposal. They say that it is the same but I do not understand why they do not just accept our proposal.”

Kraaijeveld forwarded all relevant email correspondence to Brown and asked whether the country agreed. To which Brown responded on the same day: “We agree with it.” Kraaijeveld immediately reported the decision to Alegria’s attorney Erik de Vries.

This seemed to have settled the matter, but nothing was further from the truth: the ministry did not live up to the agreement. Minister Doran maintained that Kraaijeveld was not authorized to commit the country to the agreement, even though the attorney had obtained the green light from Secretary General Brown.

The court notes in its ruling that negotiations about the long lease began two years ago. In an email dated May 31, 2018, then VROMI-Minister Miklos Giterson wrote: “In principle I have no objection against the issuance in long lease. The only construction to be allowed in the area in question is a breakwater and a sea aquarium.”

The court dismissed the argument that attorney Kraaijeveld was not authorized to accept Alegria’s proposal. “When an attorney has been appointed as trial representative it generally creates reasonable confidence in the representation-authority,” the court ruling states. “It is reasonable that the one who appoints someone else to represent him also carries the responsibility for the risk of overstepping the mandate.”

The court held it against the country that Minister Doran had only objected after the fact to Kraaijeveld’s authority to enter into a settlement on behalf of the country and to Secretary General Louis Brown’s approval of it.

The court ruling confirms that Kraaijeveld was authorized to do what he did and that therefore the country is bound to the agreement.

The court furthermore dismissed the idea that the agreement devotes insufficient attention to the environment. “Construction on the parcel of water requires a permit that will have to take the protection of the environment into account. Third parties can seek protection from the law at the administrative judge if they are of the opinion that the interest of the environment is insufficiently addressed.”

The country’s attorney Zylena Bary attempted in vain to prevent that the court would declare its verdict effective immediately. ‘A verdict in summary proceedings that is not effective immediately is nothing more than a paper tiger,” the court ruling states with a reference to Alegria’s urgent need for a decision.

The court ordered the country to live up to the long lease agreement within 48 hours after it has been served. Non-compliance carries a penalty of 10,000 guilders per day with a maximum of 1 million.