Chandrika Kumaratunga should be dealt with under the law

Counsel for the petitioners in the Fundamental Rights case filed in the Supreme Court against the transfer of state lands for the building of a golf club called Waters Edge has stated the hand of former President Chandrika Bandaranaike Kumaratunga was present throughout the deal, that she is guilty of abuse of power and should be punished according to the Constitution she was expected to protect as President.

The petitioners, two retired public servants Sugathapala Medis and Raja Senanayake state in their written submissions filed in the Supreme Court on Monday that the actions of former President Kumaratunga is not protected by law and that her immunity shielded her from legal challenges only while holding office.

The petitioners in this case claim former President Kumaratunga introduced a Cabinet Paper in her capacity as Minister of Finance for a group of persons to construct a golf course on a large extent of state land near the Parliament complex evicting people who were residing there and then misled the Cabinet into believing foreign funds were being invested in the project through the Board of Investment(BOI).

It later transpired the petitioners claim, once the Cabinet approved this project, the persons to whom the permit was granted to build the golf course sold their shares to another group for a sum of over Rs. 150 Million, and that one of former President Kumaratunga's friends, Mr. Ronnie Peiris, with whom she stayed during her visits to the UK, profited to the tune of Rs. 60 million or more from the transaction.
They claim Mr. Peiris admitted he made this money when he was questioned by the Department of Inland Revenue.

Former President Chandrika Bandaranaike Kumaratunga misdirected her own Cabinet

Subsequently, the company which purchased the licence from the original ‘so-called’ investors to build the golf course, had obtained permission from the Urban Development Authority (UDA)to sell some of the land on a 'free-hold' basis to individuals and proceeded to make a huge profit from the exercise. They then proceeded to build a private ‘members only’ golf club, outside the scope of the original purpose for which the property had been acquired by the state from long-time residents of the area, which was for a 'public purpose'.

In written submissions which followed the oral arguments, the Supreme Court bench presided over by Chief Justice Sarath Silva and comprising Justice Shirani Thillakawardene and Justice P.A. Ratnayake, the petitioners say it is common ground that these lands were acquired in the early 1980s for flood retention purposes and the extension of the Parliament complex.

However, under the tenure of former President Kumaratunga, she had personally put forward this proposal asking for special BOI concessions to be given to the Asia Pacific Golf Company Ltd., which was set-up for the project. Nevertheless, the BOI themselves has now stated that at no time did they recommend to special concessionary terms be enjoyed by the company.

The petitioners say in September 2000, an instrument unknown to the law called a 'Licence' was given to this company. With this Licence a 99-year lease for over 200 acres of land was given. In 2001, the UDA changed the original conditions of the Licence and granted permission to build villas and apartments, resorts, cottage houses and right to transfer free-hold title to buyers. Over 100 blocks were sold to various persons they claim.

They point out that golf courses are globally used as "Trojan horses employing fairways and greens as an excuse to build rows of villas on environmentally sensitive lands" and cite a recent example in Spain where this has been done.

The entire process of alienating these state lands was done "behind closed doors", and without transparancy the petitioners say. The public contracts in the nature of leases and licences had been entered into "unsolicited" and the company had been selected "without any basis".

The petitioners say this is "corruption" and amounts to "anti-competetive practices". They point out several "promoters" have been involved, including a Japansese national, who if he existed, had left the collaboration even before the commencement of the 'purported project'.

There were no tangible assets in this company (Asia Pacific Golf Courses Ltd.) at the state it entered into contracts, nor was there any objective evaluation of the credentials of the so-called investors. "Whether at any stage they brought any tangible foreign or local investment is yet an unresolved mystery", the petitioners say.

It is now admitted the UDA did not identify the lands nor selected the company for the project. "There had been an unseen yet known hand" in the exercise, they added.

Ronnie Peiris admitted accepting Rs. 60 million

The petitioners question whether the purported golf course project had a public purpose. They say even if the project was a commercial purpose, it could still have been a public purpose, for instance if it was a hospital or airport etc. In this case, there is no such public purpose, they argue, saying the mere fact that the public can obtain membership from the club or walk into its restaurants and partake in the buffet dinner does not make it a public purpose. Furthermore, it is evident that the company later got involved in land sales and selling apartment blocks.

As President, Ms. Kumaratunga exercised her powers in trust for the public she had a duty to work within the Constitutional and legal framework of the country. Constitutional immunity accorded to a President should not be a motivating factor to engage in corrupt practices. The protection of the Constitution as the repository of Executive power should be the foremost duty of the highest Executive. Anyone breaching that should be dealt with in the interest of the Constitution itself, and Ms. Kumaratunga has violated Article 12 (1) of the Constitution, the petitioners say.

They ask if Ms. Kumaratunga was guided by any expertise or experience on the part of the Asia Pacific Golf Course Ltd. company to undertake this project at hand and whether their financial credentials by way of their financial profile or assets was taken into consideration.

It is in this background the petitioners say that Ms. Kumaratunga's friendship with the 5th respondent Mr. Ronnie Peiris becomes important. Mr. Ronnie Peiris, who chose not to answer allegations made in this case, had in fact admitted the acceptance of Rs. 60 million for the transaction between the original shareholders of Asia Pacific and the current owners - thus playing a role of an "influence peddler", whose role is now well recognised in good governance studies and anti-corruption discourses around the world.

Influence peddling is defined as "the illegal practice of using one's influence in government or connections with persons in authority to obtain favours or preferential treatment for another, usually in return for payment".

The petitioners say that with the adoption of the UN Convention against Corruption, which is ratified by Sri Lanka, there is a global movement to recover assets accumulated by individuals by corrupt means. All state parties are required to ensure, by legislative and administrative means, that its financial institutions maintain adequate records to identify beneficial owners of financial transactions and to "conduct enhanced scrutiny of accounts sought or maintained by or on behalf of individuals who are, or have been entrusted with prominent public functions and their family members and close associates". These close associates are also sometimes called "Politically Exposed Persons" or PEPs in global accountability terms.

The petitioners submit that Mr. Ronnie Peiris being a close associate of Ms. Chandrika Kumaratunga should be subject to close scrutiny under the domestic legal framework. Referring to the promoters, 'back-door investors' and Mr. Ronnie Peiris, the petitioners say that 'strangers' cannot benefit from public contracts merely by influencing the people in power. They say that these persons received 'kick-backs' from a public contract.

These 'promoters' viz., Mr. and Mrs. Selvaratnam and Mr. Ronnie Peiris have "done nothing" with regard to this purported project, and had not even bothered to file objections in this case.

The petitioners say that the 235 acres that had been alienated in contravention of the 13th Amendment of the Constitution that states that the relevant Provincial Council had to be consulted when giving State land to any party. "Therefore, the transactions are prima-facie flawed, making the entire alienation null and void".

Pointing out to the change in the share-holding of the company Asia Pacific Golf Courses Ltd., the petitioners say that when the original shareholders sold their shares to the current owners of the company, one of the new shareholders was a company incorporated in Lnevis Islands -that company holds 46.61% of the shares of Asia Pacific now.

The petitioners have asked Court to 'lift the veil of incorporation' of Asia Pacific Golf Courses Ltd., and see whether in fact, it received any monies from any foreign source as expected under the Cabinet Memorandum and Decisions.

The petitioners have asked Court to declare the entire transaction null and void and to grant just and equitable relief in this case under the terms of the Constitution.

This is a case, they say, of how an autonomous corporation (UDA), incorporated in the public interest, could act under the dictation of the Executive (President), leading to a collosal loss to the State and the Public.

Mr. J.C. Weliamuna with Ms. Maduranga Rathnayake instructed by Samararatna Associates appeared for the two petitioners.