Tongasat’s appeal aimed at hindering suing former PMs, says Pōhiva

By Kalino Lātū, editor of Kaniva News  

Tonga’s Prime Minister ‘Akilisi Pōhiva says he believes an appeal by Tongasat against a Supreme Court ruling over the illegal payment of millions of dollars is an attempt to hinder attempts to sue those involved and to force Princess Pilolevu to pay back the money.

Parliament tabled a submission by the government early this month to sue ex Prime Ministers Lord Sevele and Lord Tu’ivakanō for their involvement in the illegal payment of TP$90 million (NZ$60 million).

Pōhiva has revealed there was also a plan to lodge additional legal action to force Princess Pilolevu and Tongasat to pay back the money.

READ MORE: Petition to sue ex-PMs over US$50m Tongasat payment

However, he said he had discussed this with his counsel, Dr Rodney Harrison, and there was concern that the money could not be recovered and it would be very hard to investigate it.

Pōhiva told Kaniva News in an exclusive interview this week in Auckland that Tongasat’s appeal would not change Lord Chief Justice Paulsen’s decision.

“They are free to appeal and that was part of the judicial process, but I don’t think it would affect the Supreme Court’s decision,” the Prime Minister said.

Pohiva said he had read the decision repeatedly and marvelled at how Judge Paulsen looked at all evidence and arguments before he declared that the payments of the money made by the government of Tonga to Tongasat was unlawful within the meaning of the Public Finance Management Act.

Appeal filed
Tongasat, which is also known as The Friendly Islands Satellite Communications Ltd. (Tongasat), filed a notice of appeal against the Supreme Court decision in August.

Its counsel, W.C. Edwards, then filed the appeal in the Court of Appeal of Tonga on October 16.

The appellants said they had fresh evidence from witnesses, including former Ministers of Finance Lord Matoto, Dr ‘Aisake Eke, Sunia Fili and former Chief Secretary to Cabinet ‘Aholotu Palu.

Lord Chief Justice Paulsen issued a declaration on the legal status of the main points of the claims made in the court case in September.

He said the first tranche payment of US$24.45 million in aid grant funds received by the kingdom from the People’s Republic of China on September 4, 2008, was a grant and therefore public money within the meaning of the Public Finance Management Act.

“Following its receipt by the Kingdom, US$20,985,667 of the first payment was paid to or for the benefit of Tongasat pursuant to a purported agreement between the then Prime Minister of Tonga, Dr Feleti Sevele and Tongasat,” the judge said.

“The payment of US$20,985,667 of the first payment to or for the benefit of Tongasat was expended in breach of section 9 of the PFMA and accordingly unlawful and invalid.

Finance act breach
“To the extent that the first payment was expended to satisfy pre-existing liabilities of Tongasat that expenditure was in breach of section 30 of the PFMA and accordingly unlawful and invalid.

“The purported agreement between the then Prime Minister and Tongasat was in breach of the PFMA and in excess of Dr Sevele’s lawful powers and authority as Prime Minister and accordingly unlawful and invalid.

“Tongasat was not entitled to payment of the first payment or any part thereof under either the Agency Agreement or the Agency Termination Agreement.

“The second payment of US$25.450 million in aid grant funds received by the kingdom from the People’s Republic of China on June 9, 2011 was a ‘grant’ and accordingly public money within the meaning of the PFMA.

“Following its receipt by the Kingdom, the second payment was paid in its entirety to or for the benefit of Tongasat pursuant to a purported agreement between the then Prime Minister of Tonga, Dr Feleti Sevele and Tongasat.

“The payment of the second payment in its entirety to or for the benefit of Tongasat was expended in breach of section 9 of the PFMA and accordingly unlawful and invalid.

“To the extent that the first payment was expended to satisfy pre-existing liabilities of Tongasat that expenditure was in breach of section 30 of the PFMA and accordingly unlawful and invalid.

“The purported agreement between the then Prime Minister and Tongasat was both in breach of the PFMA and in excess of Dr Sevele’ s lawful powers and authority as Prime Minister and accordingly unlawful and invalid.

“Tongasat was not entitled to payment of the second tranche payment or any part thereof under either the Agency Agreement or the Agency Termination Agreement.”

The Pacific Media Centre has a content sharing arrangement with Kaniva News.