An intriguing element of Anguilla’s legal status as a British Overseas Territory is the concept of Contingent Liability which essentially establishes the fact that the United Kingdom (as the Administering Power) has ultimate responsibility for Anguilla (as its Ward). This issue of liability is most frequently (but not exclusively) invoked with regard to fiscal matters (such as borrowing and debt) as Her Majesty’s Government (or HMG) is ultimately responsible for paying any notes and obligations upon which the Government of Anguilla (or GoA) might default–essentially the risk a guarantor or a co-signer to a loan assumes.
On a parallel vein, such notions of Contingent Liability relate to issues such as Eminent Domain, for if Anguilla were to invoke its perceived legal rights over its land such action could result in law suits that the island can’t realistically or practically afford—for even if such law suits are eventually decided in Anguilla’s favor they can take years to be finalized and could encumber the island with substantial expense during the process…a painful reality even if such expenses are eventually repaid. Interestingly two of the most discussed eminent domain options relate to Maunday’s Bay (as Cap Juluca is built on leased land) and The Forest (as additional land is needed to extend the airport runway) although other scenarios are also relevant (such as Little Harbour for marina development) whereby all three areas noted are important to Anguilla’s future.
With the above in mind, in situations where land is Anguillan owned, I personally believe the exercise of Eminent Domain should be handled and addressed with utmost care as a true last resort–but in cases of expatriate ownership the option has more immediacy…especially when the issue of Eminent Domain coincides with severe breaches of Alien Land Holding License obligations thereby activating the forfeiture clauses that are clearly contained in all licenses that are issued for the purchase of undeveloped property
Concomitantly, however, one must proceed carefully as the vast majority of alienated lands that could be subject to forfeiture under the terms of an issued Alien Land Holding License are owned by Caucasian Americans and Europeans–as such there is an understandable concern that if an aggressive Eminent Domain or forfeiture policy were to be implemented by Anguilla it could be seen in a Mugabe / Zimbabwe context thereby intimidating developers and needed development…however I believe there is an answer to that concern, namely Contingent Liability Inverted that puts responsibility for the contractual enforcement of Alien Land Holding Licenses where it belongs: with The Governor and HMG.
Ever since I arrived on Anguilla in 1977 (yes, as a Caucasian American) I’ve been aware of (and surprised by) the fact that all Alien Land Holding Licenses are signed by the appointed Governor of the day on behalf of HMG as opposed to being signed by the elected and subsequently appointed Minister of Lands on behalf of the GoA–as such breaches of Alien Land Holding License terms are essentially breaches to HMG meaning (in my opinion) that the HMG has the obligation to enforce the contracts they signed…whereby such HMG enforcement of contractual obligations would negate the argument that any Alien in default might make claiming Anguilla was becoming a Caribbean Zimbabwe. If HMG via the Governor were to accept their responsibility to Anguilla for enforcing the contracts that the Governor signed it would force Aliens in default to live up to their construction and development obligations or induce them to sell their land to a purchaser who will (hopefully) respect the terms of their contractual arrangements or convince them to donate their land to (for example) a church of their choice or to The Community Foundation or to The National Trust, etc—if the Alien in default didn’t make any of the referenced moves their land should be forfeited so that the land could then be put into productive use for proper development or retained for recreation and social purposes for those of us who call Anguilla home…whereby (as an interesting aside) forfeited land is legally forfeited to The Crown not to Anguilla.
As an example of egregious behavior by an Alien in default, the owner of a four acre beach front parcel that was purchased under an Alien Land Holding License over 10 years ago but upon which nothing has ever been built refused an offer to sell that would have resulted in a substantial seven figure profit because the owner wanted a more substantial seven figure profit—all while in breach of his contractual obligations and all while he was in a contractual position to be subject to forfeiture…the owner was able to be so intransigent because he wasn’t under any Government pressure to live up to his obligations (as such, no transfer tax or import duties were generated, no employment was realized, no Social Security contributions were made, etc.). However such pressure should be exerted on those in default—for what love do those in default have for us and, correspondingly, what love should we have for those in default? As such, I contend (herein again) the pressure to enforce the contractual commitments contained within an Alien Land Holding License should be exerted by The Governor as the Governor signed the License itself—whatever protocol was invoked for The Governor to initially sign the License should be invoked for The Governor to subsequently sign the default letter.
As it stands now there are far too many acres of undeveloped land that were alienated with contractual commitments to develop but that remain fallow, acreage that could and should be put to use–although forfeited land cannot be sold it can be leased and leased at terms favorable enough to encourage investors to develop…investors who would respect the contractual commitments they make knowing what happened to the previous investors who flouted their commitments. While I don’t have a hard figure with regard to the value of the potential investment or the value of the possible divestiture that such contractual enforcement would generate, I don’t doubt it would be in the tens of millions of US Dollars—a substantial economic impact for such a small island…whereby it is (I assert) eminently more justifiable to generate revenue from Aliens in default than from local pockets or to implement service cut backs. With the foregoing in mind, my suggestion to HMG would be to proceed immediately by resetting the clock for all Aliens in default, meaning if an Alien had three years to develop when they purchased they’d be given three years again–but The Governor and HMG must now make it absolutely clear and must ensure that Aliens know their failure to adhere to the terms of their contract this time around will result in HMG enforcing those terms for the good of the island.
Scott Hauser is the Managing Director of Sotheby’s International Realty / Anguilla Properties and has lived in Anguilla since 1977—he has been active in the real estate market since that time, whereby he earned a Masters in Real Estate Development from MIT in Cambridge Massachusetts in 1989.
(Published without editing by The Anguillian newspaper.)
