IMPERIAL Pacific International LLC’s construction crane funds are an insurance against possible liability, IPI attorney Michael Dotts said.
In August 2016, he added, there was a dispute between IPI and some of its neighbors when IPI started setting up large construction cranes for its hotel-casino project in Garapan.
Workers have dismantled crane #4 at the IPI construction worksite in this photo taken Thursday.
Photo by Bryan Manabat
“The neighbors were worried that a crane might fall over or something could be dropped by a crane and damage property or severely injure or kill someone. IPI purchased insurance to cover this, but the neighbors raised the concern that it could take months or years for an insurance company to pay a claim. So as a compromise, IPI deposited about $2.4 million into an escrow account with Security Title so that if an accident did happen funds would be immediately available to pay claims,” Dotts said.
Chief Judge Ramona V. Manglona of the District Court for the NMI inquired about the “crane litigation fund” after she found IPI, IPI Holdings Limited and IPI chairwoman Cui Li Jie in civil contempt for failing to pay their current employees’ back wages and the consent judgment with the U.S. Department of Labor.
Recently, the judge allowed the removal of a crane from the IPI construction site, but maintained the stop work order and prohibited work on the improvement and development of the hotel-casino.
Dotts said the funds deposited with Security Title covered crane No. 4, which was on the east side of the building. “That crane is now coming down. Once it is down (and assuming there are no accidents) about $2.3 million will be available to IPI,” he said.
“A number of creditors know this, and Pacific Rim Land Development LLC for one has tried to get that money,” Dotts added.
The federal court earlier ordered IPI to pay $5.6 million to its former contractor, Pacific Rim Land Development LLC.
“Security Title deposited the money with the Superior Court so that creditors could make any claims they had against it, and leave Security Title out of it. That is why the money is with the Superior Court,” Dotts said.
“IPI must pay back wages and open the account to guarantee future payment of wages to its workers by March 1 to satisfy the U.S. DOL and to comply with an order entered by Judge Manglona in federal court.
“If IPI does not pay the back wages and open the security account by March 1, then a receiver will be appointed by the federal court to start selling IPI’s assets to raise the money needed for these purposes,” Dotts said.
He reiterated that “if the crane comes down quick enough, and without incident, the funds held by the Superior Court could be used by IPI to meet the March 1 deadline.”
