Government is facing a $300,000 bill in missed mortgage payments following a mix-up over ownership of part of the new Berkeley Institute site, The Royal Gazette has learned.

Works and Engineering Minister Alex Scott said he discovered at the end of last year that The Haven Trust still held the deeds to its previous home in Berkeley Road -- despite the former UBP Government agreeing a deal to take over responsibility for the property.

He said between $250,000 and $500,000 was owing. He said the agreement was that The Haven would be given a new home in Bayview, and would not move into the property with any debt.

He said it was decided that Government would take over the mortgage payments of the property, on the understanding that the Trust paid all of the interest due before the day the deal was signed.

However, the deeds were not transferred from The Haven over to Government before the PLP Government was elected in November, 1998. And at the end of 2000, Government took possession of the site and began clearing land for the new $70 million school.

In May of last year, the land was handed over to Pro-Active Management Systems, who were awarded the contract to build the project. Mr. Scott said it was only towards the end of last year, when the trust chairman contacted him with grave concerns, that he realised the conveyancing of the deeds had not been done - and therefore mortgage payments had not been paid.

He said: “The Trust has been pursued by the bank because the payments weren't paid, and in turn we have been pursued by the Trust.

“The bank's concern and patience is obviously wearing down. We immediately got in touch with the bank straight away to make sure that the bank did not unfairly pursue the Trust. The bank is now aware that Government is responsible for the debt and will be paying it once the conveyancing is done.

“The money is there in the budget for the Berkeley project to pay for the debt and it will be paid. I am not aware of any extraordinary (financial) penalties, as a result of this. If someone presents me with details of a consequence it will be the first I am aware of it.”

He said the lawyers at the Attorney General's Chambers were working with the bank's lawyers to settle the issue. But last night, Mr. Scott came under fire from Shadow Works and Engineering Minister Erwin Adderley, who said the Government Minister should have made sure everything was in place before allowing the land to be used for construction.

And he said he was concerned that Government would now be faced with additional penalty costs on top of the mortgage arrears, which would ultimately come out of the public purse.

Mr. Adderley said: “As a result of the delay in transferring the deeds, it is set to cost Government a lot of extra money. From what I understand, the Government was not responsible for the payments until it took possession of the land. The Haven Trust had tenants on their site, and therefore had an income to pay the mortgage.

“Once the Government took over, the tenants moved out and the Trust could no longer pay. The Haven should never have been pursued by the bank and lawyers.

“I don't doubt there will be interest costs and penalties for Government to pay on this. Everyone has to pay a penalty if they do not repay a debt on time.”

But Mr. Scott said as far as he was concerned, when he became Minister of Works and Engineering, the deal had already been done. He added: “You don't check what you think has already been done. I thought the deal was settled. I did not ask whether the previous Government had taken it (transferring of the deeds) to Parliament. I was led to believe it was in order.”

Haven trustee Charles Vaucrosson would only say last night: “All we know is that we exchanged (properties) for the Bayview Haven. We offered the Government the deeds to the (old) Haven.

“I keep asking Government for it (copies of the deeds transfer) and they keep telling me it's on the way. The Government has assured me everything is under control and I don't doubt what is being said.”