Claudia Calleja
Seafarers, creditors continue to drift in Sea Malta liquidation
Sea Malta creditors yesterday gathered for a second annual meeting since the company's voluntary liquidation almost three years ago only to hear what they already knew: that there are not enough funds to make good for all of them.
"We came here with a headache and we are leaving with a headache. We got nothing out of this meeting," one creditor said at the end of the meeting when Sea Malta liquidators distributed a report to creditors in accordance with the law.
The report gave an overview of the Sea Malta liquidation process and the amount of money demanded by various creditors and companies and also listed past and pending court proceedings in connection with the liquidation.
As creditors - especially former Sea Malta seafarers - expressed frustration during a rather heated meeting, the liquidators explained they were not in a position to give clearer indications of payment due before the courts pronounce themselves on the ranking priorities of creditors.
Liquidators Andrew Chetcuti Ganado and John Abela repeatedly explained to the creditors present the reasons why their hands were tied at this stage.
As outlined in the report, since the court auction sale of Sea Malta's major assets - the mv Maltese Falcon (sold for Lm1.75 million; just over €4 million) and the mv Żebbuġ (sold for Lm610,000/€1.4 million) - various creditors were contesting their right to a priority of payment in two separate proceedings (one for each vessel).
Sea Malta was liquidated on December 12, 2005, after a prospective buyer - the Grimaldi Group - pulled out when the General Workers' Union failed to meet a deadline to negotiate a deal on seafarers.
The main participants in the pending proceedings are Bank of Valletta, the Malta Maritime Authority, Malta Shipyards, the VAT Commissioner, a number of seafarers and the liquidators who are claiming expenses.
The liquidators insisted that, before the courts apportioned priority of the creditors, they were not in a position to tell other creditors how much they would be entitled to.
What was clear was that "it is not envisaged that there will be sufficient funds to make good for all creditors but the liquidators are confident that their responsible actions continue to maximise the value of assets and protect creditors' interests," according to the report.
At yesterday's meeting, a number of seafarers expressed frustration at the manner things were being handled. They insisted on their right to be paid the privileged amount of notice money (money owed by law to employees after notice of termination of employment is served) owed to them but the liquidators explained that such payment was not made because they had objected to this after being sent letters. The seafares denied objecting to the payment and the liquidators said they could back up their claims with documentation.
A heated argument followed and, when the situation calmed down, the liquidators committed to sending each seafarer an individual letter informing them about the right to the notice money and listing the amount owed by law and that was, therefore, guaranteed to be paid without prejudice to pending court cases.
Meanwhile, other creditors present were irate about the fact that the seafarers took over the meeting to underscore their own issues.
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Charles Briffa
Sep 24th 2008, 18:24
Final Part (part 3)
c) Considering what is happening to Sea Malta’s seamen, what is the purpose of entering into any agreements for seamen working on Malta Flag vessels?
Last but not least one has to keep in mind that when Sea Malta and the GWU agreed upon Article
64 – ‘Liquidation of the Company’, the original wage claim by the GWU was reduced considerably in exchange for the redundancy payments which the Company undertook to pay its employees.
Sea Malta Co Ltd was expected to comply with the rules and conditions re the provisions as laid down in Employment and Industrial Relations Act.
Charles Briffa
Sep 24th 2008, 18:17
part 2
In view of the fact that:
1. There is still a Collective Agreement in force,
2. Sea Malta’s ships were under the provisions of the Merchant Shipping Act,
3. The ‘Employment and Industrial Relations Act’ under Articles 36, 37, and 38 provides that the Act ‘shall not apply in respect of seamen employed on ships under the provisions of the Malta Merchant Shipping Act; and in the event of any conflict between any of the provisions of the said Act and of the provisions of this Act, the former shall apply’, and
4. Article 131 of the Merchant Shipping Act clearly states what and how the ‘Payment of Wages’ are to settled,
I am wondering:
a) Is a Collective Agreement entered into between two entities, one of which being the Maltese Government, a valid document?
b) Which is the competent authority that should safeguard the interest of employees, especially seamen’s rights under a Collective Agreement, EIRA and especially the Maltese Constitution?
Charles Briffa
Sep 24th 2008, 18:12
Part 1
At the time when Sea Malta Co.Ltd went into voluntary liquidation on 12th Dec 2005, there was still in force two Collective Agreements entered into on 1st Jan 1996 between the GWU and Sea Malta Co. covering the Seaborne Officers and Ratings.
These Agreements state clearly that they were to remain in force “Until such a time as a new Agreement is concluded, this agreement shall remain in force” (Article 3 refers)
Furthermore Article 64 – ‘Liquidation of the Company’ of the Collective Agreement provide that: “In the event of Liquidation of the Company, all Officers shall be entitled to receive the full redundancy payments due to them as laid down in Article 17 of this Agreement.”
The same article applies to the Company’s Ratings.
In view of the fact that: ...cont on part 2
J Oatmon
Sep 24th 2008, 13:11
The situation where the unions refuse a rescue plan, is now happening at Alitalia.
Instead of accepting a smaller portion of the pie and keeping some jobs, and an ongoing company, the Alitalia unions would rather not give ground and prefer to see the company go bankrupt (another Sea Malta situation).
This 'cut off your nose to spite you face' attitude will cost everyone at Alitalia their jobs just Like Sea Malta.
l Galea
Sep 24th 2008, 12:26
Aren't the workers protected as first claimants re their wages?
C. Micallef
Sep 24th 2008, 10:27
This is a very unpleasant situation.
What has become of the previous top management of Sea Malta?
Well...they're off to their new jobs, some even lecturing others how to run their own companies!!!!
Surely, there must be some better way for justice to be done.
One final comment which I would very much like to be followed up in the Times' Correspondence, is the issue of the filing of 'abridged accounts'. Given the current market conditions and risks, do not creditors - who often are risking more money than the shareholders, and certainly risking much more than the debtors' management - have the right to have more details about their clients?
Filed abridged accounts show a very limited balance sheet, and no turnover details or cashflow details. You see debtors of Euro 582,000 and creditors of 815,000 - do you give this company credit terms?