Barbara Gayle, Staff Reporter

The Ezroy Millwood-led National Transport Cooperative Society (NTCS) yesterday lost its legal battle in the Court of Appeal to restore a $4.5 billion-dollar arbitration award with interest against the Government.

Reasons for dismissing the appeal will be given on June 6.

The arbitration award was made in 2001 and in June 2004, the award with interest amounted to $8 billion.

Deputy Solicitor General Patrick Foster, QC, told The Gleaner yesterday that he was pleased with the outcome of the appeal.

Millwood, who was obviously disappointed with the ruling, said he would have to discuss with his lawyers whether he would take the matter any further.

Sued the Government

The NTCS sued the Government to recover damages for losses after the administration took control of the public transportation system in the Kingston Metropolitan Transport Region. This happened five years before the Government's 10-year contract with three franchise holders expired.

Both the Government and the NTCS agreed to arbitration and in October 2003, the arbitrators ruled that the Government should pay the NTCS $4.5 billion, with interest, for the years 1995-2001, because it had breached the contract.

The interest was to be calculated from the end of each accounting year at Treasury bill and commercial bank rates.

The Government took the issue to the Supreme Court and in June 2004, Justice Patrick Brooks overturned the arbitration award and ordered the NTCS to pay the Government's legal costs in the Supreme Court, as well as for the arbitration proceedings.

The judge, in handing down his decision in favour of the Government, contended that the arbitrators had erred in holding that the 1996 heads of agreement did not vary or amend the 1995 franchise agreement.