The VIEC claims that approval for the controversial project, which may adversely impact Hans Creek — a fisheries protected area — should never have been granted. But government, backed by developers Quorum Ltd., disagrees. And Dr. Smith has maintained that the proposed $80 million project would bring much needed tax money, high-end tourists and mega-yachts to the territory.

At stake in the ongoing trial is not only the size and scope of the planned resort and marina, but also how planning and development is approved and carried out in the VI and regionwide.

Monday

Early in the morning, VIEC members crowded into the back of the courtroom, set up adjacent to the Dolphin Discovery Centre, in the Road Town resort. Many were excitedly awaiting the start of the judicial review, which was railroaded in 2007 when lawyers challenged that the VIEC application had come too late.

Over the last two years, the matter passed from the VI Civil Court to the Eastern Caribbean Court of Appeal, where in December 2008 justices upheld the lower court’s ruling, and pressed for the judicial review to be held.

But the proceedings took yet another unexpected turn on Monday morning, when counsel for Quorum Development Ltd., Gerard Farara, QC, challenged that the VIEC had improperly listed the Attorney General’s Office as the sole respondent.

Originally, Dr. Smith, the former chief minister and minister responsible for planning, was listed on the claim. But acting on the advice of legal counsel, the VIEC dropped Dr. Smith, who was no longer the chief minister, and whose position was renamed “premier” after the drafting of the 2007 Constitution.

If successful, Mr. Farara’s submission may have completely derailed the judicial review. But after a day of legal jostling, Justice Indra-Harprishad Charles sided with the VIEC, ruling that the AG was the proper party.

VIEC’s case

The VIEC is challenging the BI development on three grounds: irrationality, illegality, and bias.

Illegal, because the planned resort, the group claims, will be in breach of the Fisheries Ordinance, as it likely would adversely affect a fisheries protected area; irrational, because nearly all the scientific data available allegedly calls for redesigns to mitigate negative environmental effects; and biased, because Dr. Smith, who was also the then-minister responsible for planning, allegedly was biased when he rubber-stamped the development.

All three factors are all general principles of administrative law in the Virgin Islands, explained the VIEC’s counsel, Mumta Ito. While the terms themselves may not be found in the law, when the Planning Act was drafted, it reflected these principles.

The strength of the VIEC’s case, according to counsel Stephen Hockman, QC, is that the judge needs only to agree with one principle of the multi-pronged argument, for the judicial review to succeed.

Bias

Citing recently disclosed documents, Mr. Hockman said that early on Dr. Smith pledged his government’s support to developers.

In May, 2004, the then-chief minister and other government officials travelled to Hong Kong, where they met with developer Raymond Hung, and reiterated their commitment to seeing a five-star resort, golf course, and mega-yacht marina.

Three months later, Dr. Smith followed up on the meeting by sending a letter, on behalf of his ministerial colleagues, to Mr. Hung, which said the project remained a “top priority” for the government. He pressed for the development to be finished by his government’s first term, writing, “we appreciate this relies on requisite approval from relevant departments.”

From that point on, Quorum Developers spent millions drawing designs and planning the resort — a commercially imprudent step, Mr. Hockman argued, unless they were assured of forthcoming planning approval.

The then-government also was heavily invested in the project, according to Mr. Hockman. In signing the contract, government committed itself not only to damages for breach of contract, including liquidation damages, but to unlimited damages and injunctive relief.

According to the VIEC lawyer, weeks before approval was granted, government passed an order permitting any development over $10 million to be referred to the chief minister for approval, “a power never exercised before or since.”

The order is “clearly directed to enable [Dr. Smith] to make the decision in this particular project, given the timing, given the obligation government entered into … to facilitate this project,” Mr. Hockman told the Court.

Irrationality

Apart from claims of bias, the VIEC lawyer argued that given the preponderance of scientific evidence presented to Dr. Smith, he must have been acting irrationally to approve the project.

Environmental data on BI includes three separate reports: an environmental impact assessment, completed by Florida-based Applied Technology and Management; a second set of reports, commissioned by the developer, authored by Dr. Leonard Nurse, a senior lecturer at the University of the West Indies; and a previously private “secret” report, allegedly commissioned and received by Dr. Smith only days before planning approval was granted, by David Briggs.

According to Mr. Hockman, all three reports find that the development will have serious adverse impacts on a fisheries protected area, and call for the redesign of part of the development.

The ATM report, according to the VIEC, “had no doubt in September 2006 that Hans Creek was an officially designated fishery protected area, and therefore … prohibited any development that would have an effect on the designated area.”

Following the initial EIA, in November 2006, then-Chief Planning Officer Louis Potter wrote to Dr. Smith that the developers had “already accepted that Hans Creek was a fisheries protected area” and that, despite significant efforts by developers, “major elements of the project may have an effect on the marine protected area, due to manmade, or unforeseen events.”

Dr. Nurse, who wrote a series of reports to government and developers, said that at best developers could hope that potential negative impacts, which failed to be fully addressed, would be “minimized.”

‘Secret’ report

By January 2007, Mr. Hockman said that the government had the EIA, Dr. Nurse’s original report form September 2006, and two further documents which “never found the light of day, and were never put into the public domain, either by the interested party or the government.”

“Why is that?” asked the VIEC lawyer. “Plainly, because the true decision had already been granted. The firm decision was to grant planning approval.”

But in 2007, the government allegedly commissioned a “secret” eight-to-nine-page report, by Mr. Briggs. The author, according to Mr. Hockman, did not cite the data he used for analysis, or provide professional credentials.

According to the VIEC, this report, which was submitted into evidence by government and developers, also critically doubted elements of the development.

The report found that “there are areas of the project where the missing information is so important that resolution of the related problem could require redesign,” and that elements of the golf course, particularly the use of Little Cay Bay, would pose a direct impact on a marine protected area.

“The reality is, when you look at the contents, this report does not give a green light to the decision that was made, and any rational decision maker would have used the report as a reason for not granting permission,” said Mr. Hockman.

But the development pushed forward. According to the VIEC’s lawyers, the Planning Authority asked for more time to consider the project, but in December 2006, one month before the approval was granted, the chief minister directed that the application to the planning commission be conferred to him.

The Brigg Report, according to Mr. Hockman, should have been enough to stall planning approval. “No sensible person, qualified or unqualified, would contemplate making a decision upon receiving this document,” he said.

Illegal development?

The third, and strongest of the VIEC’s claims, is that the planned development is illegal, because it is in breach of the Fisheries Ordinance, which establishes that no developments can be carried out that may “adversely impact a marine protected area.”

Hans Creek, says the VIEC, is clearly a marine protected area. “From the very concept of a fisheries protected area, [Dr. Smith] must have said with all reason, ‘well my job is to treat those areas protectively,’” Mr. Hockman told the Court.

Another issue raised by the environmental lawyer that may have far-reaching impact on territorial development, is the “outline approval” allegedly granted to the BI development.

Affidavit and written evidence, according to the VIEC, clearly states “final planning approval of the details, designs, and drawings, will be contingent on the final project requirements.”

The first EIA, produced by ATM, reports that: “Currently, the proposed BI development has only received outlined planning approval, which does not secure detailed, design elements.”

According to the VIEC lawyer, “It is quite simply unlawful to grant an outline. … If you can’t grant a final detailed approval, then you are not entitled to grant approval at all.”

“This is a clear case in which a decision was not, in fact, fairly made, or alternatively, not objectively seemed to be fairly made, in light of history,” said Mr. Hockman, concluding his remarks to the Court on Tuesday afternoon.

Mr. Farara, and Ms. Williams-Roberts submitted oral arguments on behalf of Quorum International Ltd., and the government, respectively, yesterday afternoon in the Civil Court. The proceeding is expected to continue through this morning.