Ex-minister Palo defeats shipper in false information lawsuit (1)

1/13/2016 2:22 PM
Source: BNS
Category: Economy

A court in Tallinn has found that former Minister of Economic Affairs Urve Palo did not submit false information about the 2014 ferry tender in saying that an offer by Vainamere Liinid was by 60 million euros more expensive than a rival offer by a subsidiary of the state-owned company Port of Tallinn, which won the tender.

"On Sept. 14 last year Vainamere Liinid OU filed a lawsuit with the county court against Urve Palo to have claims refuted. With its verdict on January 12 the court decided to dismiss the action. The action was filed in connection with a claim made by Urve Palo in the media that the cost of the offer of Vainamere Liinid OU in the tender procedure was 60 million euros higher than that of the joint tenderers," attorney Terje Eipre, who represented Palo in court, told BNS.

"Vainemere Liinid OU found that the information published by Urve Palo was incorrect, as the difference in the price was actually 29.8 million euros, not 60 million euros, and because of that Urve Palo must refute the data in accordance with the Law of Obligations Act at her own expense. The court established that Urve Palo has not published incorrect information, nor did the court find the information published to be unlawful. The court found that Urve Palo as former minister published the same data as was published by the Ministry of Economic Affairs and Communications, based on press releases of the Ministry of Economic Affairs and Communications," Eipre said.

The court found the claim that the offer of Vainamere Liinid was by 60 million euros more expensive was correct provided that the state does not use the buyout option. According to calculations by BNS the difference in the price would be 64.3 million euros without using the buyout option and not considering the present value of money. With the discount rate of 7.5 percent the present value would be 43.3 million euros.

Vainamere Liinid, company of Estonian businessman Vjatseslav Leedo, filed a lawsuit in September 2015 against former minister Urve Palo over the words said by Palo about the 2014 public procurement tender to award the contract to operate subsidized ferries between the mainland and Estonia's large western islands.

Palo, who was responsible for the tender in her then capacity as minister of economic affairs and infrastructure, has said the winning offer by Port of Tallinn subsidiaries was cheaper by 60 million euros over the contract period of ten years.

Previously Vainamere Liinid had sought in a formal letter that Palo make a statement refuting her claim as regards the outcome of the ferry tender. According to Vainamere Liinid, their offer in the tender was more favorable than the one made by the subsidiaries of Port of Tallinn.


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