Azzjoni Nazzjonali deputy leader Anglu Farrugia yesterday called a press conference to clear his name in the light of media reports claiming that he had two pending court cases over owed payments. Speaking at the AN headquarters in Sliema, Mr Xuereb said that the cases involve a beach concession at the Suncrest Hotel 21 years ago and the ongoing issue regarding the Verdala Hotel in Rabat. Mr Xuereb claims that he has paid Lm2 million in payments to Malta Enterprise (ME) regarding the latter case, but was refusing to pay the other Lm1 million because he claims that Minister Austin Gatt ordered the Malta Environment and Planning Authority to not process his development and extension application.
Mr Xuereb claims that the reason Dr Gatt did so was to get back at him for contesting the 1994 local council elections in Naxxar.
He also presented two affidavits in which people said that they heard the PN’s lawyer, Dr Joe Zammit Maempel tell him that they were going to drive him out of business. Mr Xuereb said that he had done his bit by sticking to the plans and also keeping workers on, but said it was an absolute injustice to leave him waiting for 14 years for a permit.
He said that he was willing to hand over the remaining Lm1 million in payments within 24 hours if Mepa processes his application. He also said that he refused to pay the cash upfront because he feared that he will be left with no cards in hand. He also said that it was a catch 22 situation and that such things did not even take place “in Communist countries”.
The facts on Verdala Hotel – Ministry
Replying to Mr Xuereb, the Ministry for Investment, Industry and IT said yesterday the sensational court case Mr Xuereb refers to in his statement was one of hundreds which political parties used to file up to recently, when the parties would have claims on whether a citizen contesting a local council election was actually residing in the locality. Mr Xuereb contested the election for the Naxxar local council, while the PN claimed he resided in Mosta. The court upheld Mr Xuereb’s version and the case was closed at that.
The ministry said that to date, neither the ministry nor ME have ever made public statements regarding the dues owed by Mr Xuereb since the case is being heard in court. But in view of what he said yesterday, the ministry had to set the record straight. In 1994, Suncrest Hotel was offered the Grand Hotel Verdala in Rabat at ca Lm2 million following a public tender. On 26 March 1997 (during the Alfred Sant administration), the Corporation entered into a deed of sale with Xuereb’s companies.
Among others this deed of sale included the following condition: “The Purchaser Company shall use the property being transferred as a hotel complex of a standard not below the 4-Star classification”. After being awarded the property, Mr Xuereb changed his mind and decided to interpret the term “hotel complex” as luxury apartments accompanied by a small hotel. MEPA has to date not issued permits for the luxury apartments. Mr Xuereb blames the opposition to the development of a golf course in the vicinity of the site as a primary reason for his “change of mind” after he was awarded the property and after he had actually signed the deed of sale, the ministry said.
Mr Xuereb has also failed to meet his companies’ obligations with respect to the full payment of the amounts due to the government on the transfer of the property. The total amount due by Mr Xuereb to the government exceeds the sum of e3.5m.
Notwithstanding multiple notices and warnings to Mr Xuereb dating from 1998 to date, he did not settle this outstanding balance. In 2005, ME instituted legal proceedings against Mr Xuereb’s companies in view of him not fulfilling his contractual obligations, primarily on two counts: The outstanding dues to the Corporation; and the unfulfilled obligation for the development and operation of the hotel complex. The ministry said ME shall keep on pursuing the said case in Court.