An injunction freezing payments from Bermuda Cablevision to its American consultants came a day too late to stop the television company from sending off nearly $4 million to The McDonald Group.

The payment was "forced through'' Cablevision's board by directors appointed by the American firm's minority shareholders, according to a letter to stockholders -- obtained by The Royal Gazette -- from Cablevision vice-president David Lines.

The Bermuda Telephone Company, through its subsidiary Colica Trust Company Limited (of which Mr. Lines is also director), is challenging the set-up of Bermuda Cablevision Ltd (BCL).

Colica claims BCL's structure and payment of 60 percent of profits as consultancy fees to The McDonald Group breach the Island's strict ownership rules.

"The `services' provided by the McDonald Group as consultant do not and have never approached a value that is equivalent to 60 percent of the profit,'' Mr.

Lines wrote.

Telephone bosses, through Colica, have already applied to have the payments halted but Chief Justice Austin Ward turned them down.

That decision is being appealed and will be heard in March. Meanwhile Mr.

Justice Ward has agreed to stop the consultancy payments, worth millions of dollars, until then.

"On Friday, January 24, we applied to the Honourable Chief Justice Austin Ward for an injunction to stop all payments of consulting fees to the McDonald Group until the Court of Appeal had ruled on this issue at a hearing fixed for March 13 and 14 this year,'' wrote Mr. Lines.

"Colica had applied for an injunction in September 1996 to prevent an earlier payment of consulting fees but this application had been refused by the Supreme Court, but this refusal is subject to such appeal to the Court of Appeal.

"At the hearing on January 24, the attorney for the company (BCL) revealed that US$3.95 million had been paid to the McDonald Group the previous day, permission having been granted by the Bermuda Monetary Authority on Monday, January 20.

"Colica had written to the Authority on that day requesting the Authority not to authorise any payments until the Court of Appeal had decided on the question of whether payments should be made under what is, we allege, an illegal contract.

"Chief Justice Austin Ward granted Colica the injunction it had sought, to prevent payment of any further consulting fees or payment by way of dividend to the McDonald Group before March 14.

"Such injunction, being too late to prevent the payment which had already been made the previous day prevents the payment of the balance of $628,100 to the McDonald Group.'' The BCL row stems from a 1987 agreement when the Alabama-based McDonald Group invested about $8 million into a struggling BCL.

The McDonald Group claims the Bermuda Government sanctioned the consultancy payments of 60 percent of the profits as well as the company's structure.

Telco, which bought BCL shares through Colica, is challenging for control of BCL and claims the set-up and fees are illegal under the 60/40 rule.

That issue is due to be decided before the Privy Council.

TELEVISION TV COURT OF APPEAL COA