The citrus war has begun to spawn a web of litigation from rival factions, but some hope that serious probes from the court into the matter could help resolve some of the legal conflicts that have set back what has proved to be one of the country’s leading earners of foreign exchange.
The Supreme Court is set to hear two ground-breaking cases in the ongoing impasse. According to executives of the Citrus Growers Association (CGA), the case—filed to seek redress in the removal of three directors—is set to be called up on Thursday, January 28. Meanwhile, reports to our newspaper are that a Supreme Court suit was filed on January 4th asking the court to order the return of $16,000 to a group of growers who are challenging the deduction of fees levied for the Mexican fruit fly program. The Citrus Products of Belize Ltd. (CPBL), in turn, demanded the funds from the CGA, to which the funds were paid. CGA says it now has to defend itself in that matter.
A third and more far-reading hearing, though, will look into a constitutional challenge filed by the founders of Belize Citrus Mutual (BCM), a break-away faction of the CGA that includes the CGA’s longest standing chairman William Bowman. The ex-CGA members say that it is unconstitutional for the law to recognize only the CGA as the association representing growers, requiring them to pay a fee (cess) and belong to the association to get licenses, issued by the CGA, in order to deliver fruit to the processing factory.
The case is due to be called up on February 10, according to one of BCM’s supporters Dr. Henry Canton.
Canton heads the CPBL, the main exporter of Belize’s citrus and citrus products, in which CGA owns 51 percent, through Belize Citrus Growers Association Investment Company Limited (ICL).
Canton, the Chief Executive Officer/Managing Director, said that while one of his companies, Sitcan Farms, has resigned from the CGA, he has other companies that have retained membership in the CGA.
The quarrel is that CGA wants to replace three directors: CPBL chairman Mike Duncker; CEO/director Dr. Henry Canton; and director Frank Redmond, with three others: Denzil Jenkins (chair of ICL), Rosella Zabaneh and her brother-in-law Antonio Zabaneh.
The current CPBL board is made up of four directors from Banks Holdings (Barbados), the minority shareholder, and five from CGA (Belize), which has the majority shares. Canton claims his seat is independent of CGA’s stance, because it is tied to his terms of employment.
With the current impasse, CGA, in effect, controls two of nine seats on the board, held by Charles Woods & Patrick Polack, although it is on record as owning 51 percent of the shares.
The CGA fingers Canton and Ernest Raymond, ICL chair at the time, for orchestrating the sell-off of the CGA shares to the Barbados group—$12 million worth of shares for $4, when they still owed $12 million for those shares. Banks had agreed to pay $25 million for the full 46.59 percent and expand value added services, as a part of the deal.
When we asked Bowman what happened to the $25 million that Banks had paid to CPBL, he said that 100 percent of it went to pay off CPBL’s debt.
The CGA got only $4 (US$2) for its 12 million shares, which were said to be valued at least $6 million. The argument was that Banks of Barbados, which paid the CGA the US$2, would inject money into the factory (CPBL), a CGA subsidiary, to make production more upscale, by introducing new technologies to boost sales on the world market.
Today, the CGA says it has two pending loans, a $6.4 million debt with the European Investment Bank until 2015 and a $1.6 million to the Social Security Board due in a few years, and it needs to preserve its financial interests to meet those and other commitments.
With Belize Citrus Mutual having been registered, there will be a big migration of the serious growers, Canton told us. They have no intention of taking control of CGA’s 51 percent, he added.
There are seven subscribers to BCM: Ernest Raymond, William Bowman, Michael Dunker, Dr. Henry Canton, Sue Hufford, Jorge Rosado, and San Miguel Farms Ltd. (Trevor Roe) of Gordon House.
BCM says that CGA is the problem and that the structure needs to be changed so that the board consists of three directors for large, medium and small growers, respectively. Small growers had to fight to have the law amended some years ago to give them a seat. They also challenge the CGA’s policy of one man, one vote – endorsed by the Cabinet of the Barrow administration.
CGA’s CEO Henry Anderson alleges, however, that BCM wants to win over citrus growers, “seeking to strangle the present CGA to cause it to crumble so that they would now be the association or the group representing growers.”
While it is mostly the larger growers and executives of CPBL, CGA and BCM who have been in the news, CGA says it represents 492 members—that’s less than half the amount of growers than a decade ago.
Jenkins recollected that about 10 years ago, there were up to 1,000 citrus growers in the industry. The number has declined for various reasons, among them the fall in prices, unbearable debts, the sale of farms and young persons not wanting to continue caring for family farms, and death in some cases.
Even as the controversy and litigation continue unabated, Jenkins appealed for peace: “We don’t want for the growers to take it into their own hands. That’s going to lead to the kind of fiasco we had with the cane farmers.”