Arbitrators have ruled that Pro-Active, the company sacked by Government from the new Berkeley Institute site, owes Government around $13 million.

According to sources close to the secret arbitration process, the decision was handed down on Friday.

Pro-Active has 28 days to pay from that date, according to the insiders, who also revealed that a company set up by the Bermuda Industrial Union, Union Asset Holdings, owes $6.5 million of that sum.

That figure relates to the performance bond for the project which is akin to an insurance policy, and was underwritten by Union Asset Holdings. The sources told this newspaper the performance bond could not be called until an agreed sum was settled upon.

The arbitrators also awarded a legal costs to Government. This, The Royal Gazette understands, would be a percentage of the total legal costs, although the exact figure was not available last night.

It is understood that a number of sub-contractors and creditors who are owed money may try to put Pro-Active into liquidation in the light of the ruling.

The Berkeley project was put out to tender by Government in November 2000.

Pro-Active Management Services won the contract and promised to complete the school by September, 2003 at a cost of around $70 million. However, in August, 2004, after repeated delays and a spiralling budget, the company was sacked from the job and the Ministry of Works & Engineering took control of the project.

The school was eventually completed last September at a cost of around $125 million – three years late and more than $50 million over budget.

The legal battle between Government and Pro-Active, which claimed its contract was wrongfully terminated, was held behind closed doors at the request of Government.

President of the Bermuda Industrial Union Chris Furbert declined to comment yesterday as did Pro-Active's legal advisor Julian Hall.

Auditor General Larry Dennis, the Government's independent financial overseer, said he had not been made privy to the information.

However, he commented: "I doubt whether any solution to this situation will be a win-win for the union and for the taxpayer. One will win and one will lose, and that's very regrettable."