The Director of public prosecutions (DPP) will have to drop criminal charges against four persons, including two former directors of the collapsed Dyoll Insurance Company Ltd, following a ruling yesterday by the Constitutional Court.

The court found that, at the time the alleged offences were committed, the provisions of the Financial Services Commission (FSC) Act relating to the insurance industry were not in effect.

The relevant provisions came into effect in March 2005. The offences were allegedly committed between December 2004 and January 2005.

The lawyers argued that the relevant part of the FSC Act could not have a retroactive effect, as this would breach section 20(7) of the constitution, by making the alleged crimes retroactive.

The court upheld the arguments and granted several declarations.

Former director and chief executive officer, 48-year-old Mark Thwaites, and former chairman James Morrison, who were charged with breaches of the Insurance Act, had filed a Constitutional motion, seeking to have the charges dropped.

Retroactive

Catherine Parke-Thwaites, wife of Mark Thwaites, and Debbie Hyde were also charged and they also challenged the Act. Winston Spaulding, Q.C., and attorneys-at-law Garth McBean, Jacqueline Samuels-Brown, Patrick Atkinson and Debra Martin, who represented the applicants, had asked the court to rule that, under the Constitution, a law cannot be passed to make criminal charges retroactive.

The DPP and the attorney general were the respondents.

Attorney-at-law, Richard Small, who represented the DPP, applied for a stay of execution of the court order to determine if there was going to be an appeal.

The Constitutional Court, comprising Chief Justice Zaila McCalla, Senior Puisne Judge Marva McIntosh and Justice Lloyd Hibbert, granted a stay until January 29.

Samuels-Brown had questioned whether the applicants would have to return to the Corporate Area Resident Magistrate's Court. The Chief Justice advised that they would have to return in March since their bail was extended to that time. The Chief Justice pointed out that the DPP was bound to abide by the court ruling.

Thwaites and Morrison were charged following allegations that they failed to provide information to the FSC, the regulatory body for insurance companies and financial institutions. Thwaites was also accused of recklessly supplying false information under the provisions of the Act. It was further alleged are that he failed to comply with directives that were given on December 17, 2004, by the FSC.

Reports are that Dyoll's problems began in 2004, following a deluge of claims arising from property damage as a result of Hurricane Ivan that September. The vast majority of the claims originated in The Cayman Islands, amounting to $850 million, and contributed to the company's deficit of $1.1 billion, which wiped out its capital base.

The Supreme Court has since issued an order winding up the insurance company, because the claims by policyholders exceeded its reinsurance limits.

barbara.gayle@gleanerjm.com