Pollution Department loses B9 bln fight over Klong Dan graft

The Administrative Court has ordered the Pollution Control Department to pay 9 billion baht to a consortium involved in the corruption-plagued Klong Dan waste water treatment project in Samut Prakan.

Vatana Assavahame, third from left, appeared at a Buddhist temple in China in July, his first public appearance since he fled a 10-year jail term for bribery in the Klong Dan waste water treatment project scandal. (Photo by Nauvarat Suksamran)

Wichian Jungrungruang, the Pollution Department's director-general, said the verdict upholds an earlier decision by an arbitration panel which ordered the agency to pay almost 9 billion baht to the NVPSKG consortium for the waste water treatment facility.

In its ruling last Friday, Administrative Court judges ruled two-to-one to award the lump sum to the NVPSKG consortium.

The amount covered construction payments and compensation plus interest.

Mr Wichian said the department will appeal to the Supreme Administrative Court. "The ruling is not unanimous, so the judges see it differently," he said.

He said state regulations require a state agency involved in a legal dispute to see the dispute through to the highest court.

The department chief said all activities involving Klong Dan waste water treatment project will remain suspended until the legal issues are settled.

"The facility will be on hold until every case is finalised," he said.

The Klong Dan project was initiated during the government of Chatichai Choonhavan. It dragged on until 1997, when the department signed a contract to hire NVPSKG to build the plant.

The cost of the project, which was initially estimated at 10.05 billion baht, increased over the years of its planning, designing, bidding and implementation.

The project was mired in irregularities, including the sale of land to the department for the project at a highly inflated price. The department decided to scrap the contract and accused the consortium of contract fraud when construction work was about 98% complete.

It filed a lawsuit against the consortium and 19 other people, including former deputy interior minister Vatana Asavahame, accusing them of corruption.

NVPSKG, which completed work on the plant and transferred ownership to the Pollution Department, took the matter to an arbitration panel in 2003.

However, the department refused to take part in the process, so the consortium filed a petition with the Civil Court, seeking the formation of an arbitration panel to settle the dispute.

The court agreed the dispute should be settled at the arbitration panel.

In January last year, the arbitration committee ruled in favour of the consortium, saying the department breached its agreement. Then the department appealed the ruling to the Administrative Court. The court handed down its ruling last Friday.

On the corruption front, the Criminal Court ruled in Nov 2009 that Vatana and 10 other defendants including consortium executives, had colluded to sell public land to the department to fraudulently secure rights to the project.

Vatana was also sentenced in 2008 by the Supreme Court's Criminal Division for Holders of Political Positions to 10 years in jail for bribing officials to obtain the land.

The scheme drew fierce protests from activists and residents who complained about environmental concerns and a lack of transparency.

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Article source: http://www.thethailandlinks.com/2012/11/12/pollution-department-loses-b9-bln-fight-over-klong-dan-graft/