By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The parties seeking to regain management control at Old Bahama Bay yesterday hit back at the Government’s investments chief by arguing her intervention was “improper” and challenging her standing to do so.

Michael Scott KC, attorney for LRA-OBB and Resort Holdings, the two corporate entities that own the West End resort and the former Ginn project, suggested that Phylicia Woods-Hanna, the Bahamas Investment Authority’s (BIA) director, had “injected” herself and the Government into a private commercial dispute to the benefit of the group opposing his clients’ bid to retake control of their property.

And, in his March 31, 2025, response to Mrs Woods-Hanna’s letter demanding that attempts to takeover Old Bahama Bay’s management “cease and desist” until all required government approvals are obtained, he instead asserted that the Government should instead focus on ensuring Island Ventures Resort and Club (IVRC), the entity his clients are seeking to replace, pays due severance and benefits to its employees.

Mr Scott, in his letter, said he had read the BIA chief’s earlier March 21, 2025, missive with “alarm and dismay” after she warned that Bahamian law would be “violated” if the Old Bahama Bay management takeover proceeds.

Pushing back hard, he wrote: “In my considered view it is improper for a regulator, which you are, to inject and insinuate [sic, insert] yourself into a private commercial dispute on behalf of one of the disputants and on the basis of hearsay evidence which you seem not to have taken any independent steps to verify for accuracy.

“Your information is wrong. In any event, please clarify your statutory jurisdiction enabling this intervention.” Mr Scott reiterated that he was acting for LRA-OBB and Resorts Holdings, the Old Bahama Bay owners, “who have terminated their tenancy and bare licence” with IVRC, which is a group of the resort’s condo owners - formed in the wake of Ginn’s 2011 financial default - that take over operating the property.

The basis of Mrs Woods-Hanna’s concerns appears to be the purported involvement of Kingwood International Resorts and its affiliates, the Reunion Cay Group of Companies, in the Old Bahama Bay management takeover given that the Government has previously twice-rejected their application for approval to operate in The Bahamas.

“We note that the NEC (National Economic Council) has not granted permission to the company to conduct business operations in The Bahamas,” Mrs Woods-Hanna wrote. “Previously, the Authority has issued two refusal letters dated May 5 and December 6, 2022.

“In light of the foregoing, please be advised that the company (Kingwood/Reunion Cay) is in violation of the laws and regulations of the Bahamas Investment Authority (BIA) and the laws of the Commonwealth of The Bahamas.

“Until permission is granted to invest and operate, and in the absence of an Investments Board permit, this letter serves as your legal notice to cease and desist all business activities by your agents and associates or by proxy.” John MacDonald, IVRC’s president, and others have voiced concerns that Kingwood is hiding behind LRA-OBB’s corporate identity to take control at West End following the previous government rejections.

However, Mr Scott, in his letter yesterday, asserted that Cleveland Duncombe, Candid Security’s principal, is leading LRA-OBB’s efforts to regain control. “I am assured that there are no foreign nationals working on-site or violating Bahamian law as you characterised it,” he said in his reply to the BIA chief.

“There are duly authorised representatives of my clients present as observers of the process as they are entitled to do as property owners. As you have, oddly, implicated [inserted] yourself into a private commercial dispute, apparently on behalf of Mr John MacDonald, please be advised that Mr MacDonald is attempting to pass off his employee termination legal obligations off to my clients.”

Mr Scott added that, to achieve this, Mr MacDonald and IVRC had “enlisted the assistance, I am instructed, of the Labour Department in Freeport, who have been trying to exert pressure on my clients to assume these responsibilities.

“I am confident you will agree that employment termination financial responsibilities reside with the outgoing employer up to the date of cessation of employment, both at common law and in accordance with sections 26-29 of the Employment Act. I am stunned that Labour Department officers are apparently unaware of this, I believe trite, formality,” he said.

“Astute as you are to the integrity of compliance with legalities, perhaps I can prevail upon you to counsel Mr MacDonald in the strongest terms.” As of late afternoon yesterday, LRA-OBB and Resorts Holdings had yet to fully complete the first phase of their plan to reclaim management control from IVRC.

Representatives for LRA-OBB and Resorts Holdings told this newspaper they are still waiting for written confirmation from the Ministry and Department of Labour that IVRC is responsible for paying its staff due severance and benefits. Rather than hire these employees directly, which could result in them waiving their entitlement to these payments from IVRC, they will instead be re-engaged as independent contractors.

But, amid the ongoing uncertainty at a key West End and Grand Bahama employer, Mr MacDonald yesterday asserted to Tribune Business that IVRC remains in management control at Old Bahama Bay. He said that “nothing” of note had occurred up until late afternoon and that it has “all been quiet”.

The IVRC president also argued that the question of severance pay and due benefits for staff has yet to arise because none have been terminated. “We don’t owe our staff any severance because we’ve not fired them,” he said. “If we let them go, we will give them severance. We’ve never not paid our employees.

“We don’t owe them any severance because we have not fired them. All our employees are on-site right now. There’s been no disruption to the resort, staff are entertaining the guests, we’re taking reservations and all vendors have been paid. All of our staff are still there. No one has been released.”

Denying that IVRC was seeking to offload its termination pay and other employees responsibilities on to LRA-OBB, Mr MacDonald said Candid Security and his security guards were effectively “sharing” duties and the security booth.

“That might also change,” he added. “The way we’re thinking, Candid Security is not interfering with us at all. They are giving extra security free of charge, which is a good thing as a guest... We’re staying with the status quo for now.”

Daniel Baker, an LRA-OBB representative, yesterday hinted at frustration on the Old Bahama Bay owner’s part that it has not been able to complete the first phase of its turnover plan as it waits for the go-ahead from the Ministry and Department of Labour on its independent contractor plan as well as who is responsible for the severance pay.

“We’re still waiting on the Ministry of Labour to get back to us. They’d committed to get back to us promptly,” he added. “Saturday, our intention was to complete the first stage of the turnover. We heard from the Ministry of Labour in Nassau that IVRC is fully responsible for the severance. They’d confirmed that verbally. We’re waiting for that in writing.”

Mr Baker argued that LRA-OBB was “going overboard” and “above and beyond” in trying to protect workers at Old Bahama Bay employed by IVRC. This, he explained, was why the resort owner intended to hire them as independent contractors rather than do so directly because the latter option could lead to waiving their entitlement to compensation from IVRC.

“IVRC is just a mechanism so the employees don’t waive their rights to severance,” Mr Baker said. “IVRC formally engaged them in direct employment and, if we offer them direct employment, they would have to resign and waive their severance. We’re trying to protect the employees 

“We’re not here to fire people. We’re here to make it better, but presently there has to be separation from IVRC to move forward. There’s a safety net to meet them on the other side. It should be a boon for them.” More than 50 workers at Old Bahama Bay are thought to be impacted.

“We’re not doing this through an outside US company,” Mr Baker added. “We’re doing it through Bahamian laws and agents that have licences to do this in The Bahamas. We’ve gone overboard in trying to be compliant and be a responsible corporate citizen. We’re not only doing the right thing legally but, as business people, going above and beyond.”