The States is facing accusations of exploitation, wasting taxpayers money and failing to follow fair process in its attempts to force out the current Fermain Beach Cafe tenant.
Belmiro de Freitas is fighting eviction proceedings through the civil court after he was served a notice to quit the premises on 4 October.
The States is attempting to swiftly move him on after awarding the contract to run the premises to someone else last September. After he failed to vacate the premises by the start of November, they moved to get a court order which Mr de Freitas is now opposing.
“Throughout the time of the lease, the States of Guernsey assured Mr De Freitas by way of its actions and communications that the lease would be renewed upon its expiry,” his defences say.
One example of this was the States agreeing in 2010 to extend the original lease, which ran from November 2003 to October 2024, to October 2038 provided that he carried out certain alterations to the premises by 31 March 2015.
The States say this was not completed and so the expiry terms of the original lease remain valid.
Mr de Freitas also received reassurances in 2023 when he discussed the possibility of buying the site or extending the lease with the States – no mention was made that there would not be a renewal, it is argued.
“Given the good working relationship and assurances Mr de Freitas made substantial capital investment.”
An expert valuation on his behalf calculated he spent £643,000 on the premises.
The defense also argues that the States failed to follow the Nolan principles that apply to anyone that works in public office.
“It is averred that the States of Guernsey has not acted openly and transparently in its discussions with Mr de Freitas. As a public authority it has unfairly benefited for its unreasonable conduct to Mr de Freitas’ detriment.”
It was not “rationale or reasonable” to decide not to enter into lease renewal negotiations, it was argued.
The States has also failed to fully explain the rationale for its decision to put the lease out to tender as opposed to entering into renewal negotiations with Mr de Frietas as is usual practice, the defence says.
It has also failed to explain what principles and process it applies in lease renewals.
The States turned down his offer of signing a five year renewal to allow some lead in time for the tender process and to more fully realise a return on the capital investment in the cafe.
“It appears that the claimant [the States] has wrung out of Mr De Freitas all it could to improve the cafe site and now seeks to exploit that with no regard for the detriment caused and loss suffered and no allowance made for the assurance it provided to Mr de Freitas. It is averred that the States of Guernsey as a government landlord and a public body is wrong to act in this way.”
The defences also claim that the process to select the new tenant was procedurally unfair because the panel had noone with hospitality experience and was not impartial because one of its members was from a company involved in marketing the cafe for rent.
It also makes a human rights angle, saying the decision was a breach of the right to the peaceful enjoyment of his possessions.
A hearing to determine the eviction order is due to take place soon.