A compensation claim for $330 million (€272.8 million) submitted by Irish beef baron Mr Larry Goodman and his family, for financial losses incurred as a result of the Iraqi invasion and occupation of Kuwait in 1991, has been rejected by the United Nations Compensation Commission (UNCC), The Irish Times has learned. Denis McClean reports from Geneva
The UNCC is a subsidiary body of the UN Security Council. Its Governing Council is due to issue its verdict on the Goodman compensation claim on July 1st, but it is understood the panel of three UNCC commissioners examining the claim has recommended that it be turned down.
It would be unprecedented for the Governing Council, which has the same membership as the Security Council, to overturn a recommendation from a UNCC panel of commissioners, who are independent experts in different fields including law, accountancy, loss adjustment, insurance and engineering.
The Irish Times has learned that the Goodman claim was based largely on the argument that non-payment of invoices for beef exports to Iraq in the years prior to the invasion triggered the banks to call in their loans to Goodman-owned companies and this created a greater loss than that caused simply by the non-payment of the invoices.
Mr Goodman's former meat processing group, Food Industries, went bankrupt in 1990 owing more than €365 million to the banks. The company's collapse was partly attributable to the cancellation of State insurance cover for beef exports to Iraq in October 1989 by the then minister for industry and commerce, Mr Des O'Malley.
Goodman companies were owed approximately €200 million for beef supplied to Iraq in the late 1980s and €158 million of this was still due according to a finding made by the Master of the High Court, Mr Edward Honohan, in April 2002.
It is understood the UNCC has rejected the Goodman claim because it was unconvinced that the losses outlined in the claim could be directly linked to the invasion of Kuwait. The UNCC was established as a result of Security Council Resolution 687 in April 1991, which declared that Iraq was "liable under international law for any direct loss, damage, including environmental damage and the depletion of natural resources, or injury to foreign governments, nationals and corporations as a result of Iraq's unlawful invasion and occupation of Kuwait".
According to UN sources, the Security Council deliberately limited the scope of claims to losses which could clearly be linked to the invasion of Kuwait.
"It should be a foreseeable, uninterrupted result of the invasion," said one source.
The rejected claim was a Category D one which allows individuals to submit claims for compensation for $100,000 or above. An earlier claim by Goodman Holdings and AIBP International Ltd was filed by the Irish government with the UNCC, which classified it as an "unusually large or complex claim" in March 1997.
At that time Mr Goodman responded to questions raised by the UNCC which also submitted the relevant documentation to Saddam Hussein's government for comment. However, the corporate claim was withdrawn in August 1997 at the request of both Mr Goodman and the Irish government.
The UNCC has received over 2.6 million claims for death, injury, loss or damage to property, commercial claims and claims for environmental damage resulting from Iraq's invasion and occupation of Kuwait in 1991. To date $18.2 billion has been paid out in compensation to victims funded by the sale of Iraqi petroleum pursuant to the oil-for-food programme, including $17 million as a result of about 400 claims received from Irish citizens or companies. The UNCC is now entering the final phase of its mandate and it is anticipated that all remaining claims will have been resolved by the panels of commissioners before the end of this year.