The Minister of Finance has been given the go-ahead to investigate the affairs of Bermuda-based Sentinel Insurance Co. Ltd., a Supreme Court judge has ruled.

And the insurance company will have to open its books to an inspector appointed by the Minister of Finance.

Legal actions between the Ministry of Finance and locally-based Sentinel Insurance Company were filed in December, but at the time neither party would reveal what prompted them to file writs at the Supreme Courts against each other.

But in a written judgment dated December 14, Chief Justice Austin Ward dealt with two cases -- Sentinel Insurance versus the Minister of Finance and Malcolm Butterfield and Registrar of Companies against Sentinel Insurance.

The judge said that two applications were before him. One was to set aside an order restraining the removal of books and papers of Sentinal Insurance Company and handing them over to an inspector appointed by the Minister of Finance on November 22, 2000.

And the other was an application for leave to seek judicial review of the Minister's decision appointing the inspector.

The judge said: "Both applications seek orders which would nullify the appointment of the Minister or Mr. Butterfield as Inspector to investigate the affairs of Sentinel Insurance Co Ltd and would prevent the Inspector from acting under the Instrument of Appointment.'' But the judge said he was satisfied that the Minister had the jurisdiction under the Companies Act 1981 and the Insurance Act 1978 to appoint an inspector.

The judge added: "There is no allegation of bad faith on the part of the Minister and he must be allowed to carry out his responsibilities under the statute.'' But he offered a compromise and said the books should be inspected at Sentinel or somewhere both parties agreed on.

He said: "I would vary the order to the extent that the production and inspection of the books and documents be either at the office of the company or such other place as be mutually agreed by counsel.'' In December Finance Minister Eugene Cox confirmed that he has appointed an inspector to look into concerns he had about Sentinel but he was tight-lipped on the nature of his concerns.

Mr. Cox said his actions were not out of the norm and expressed concern that if he elaborated the information would be blown out of proportion.

"I think the less said about this the best,'' he said in December. "I am not prepared to go any further.'' At the same time in December lawyer for Sentinel Insurance Mark Diel refused to make any comment and referred the matter to Michael Bott of Bott and Associates.

But Mr. Bott would also go no further than to say: "Sentinel Insurance has an issue with the Registrar. I will not elaborate any further.'' Austin Ward BUSINESS BUC