Hotel owner ‘skipped out on R1m bill’

UAE sheik failed to pay for renovation of iconic King Edward, claims builder

THE controversial foreign owner of Port Elizabeth’s iconic King Edward Hotel has been accused of allegedly failing to pay more than R1-million worth of bills for renovation work on the hotel.

Port Elizabeth attorney Lunen Meyer confirmed yesterday that he had pursued the matter for three years on behalf of builder Greg Webster, but had been unable to locate the owner of the hotel, United Arab Emirates-based Sheik Khalaf Ahmed Khalaf Al Otaiba, to serve a notice of demand on him.

Webster spoke about the situation which drove him into insolvency after helicopter pilot John Huddlestone came forward with a similar story of the sheik failing to pay a bill of R5 600 for a chartered flight over his Blaauwbosch Private Game Reserve near Steytlerville.

Huddlestone had responded to a Herald report last month about R155 000 still owed to Jaco Meyer, the former manager of Thaba Manzi, the sheik’s second Eastern Cape reserve near Humansdorp, following a February 27 unfair dismissal ruling against him.

The sheik’s legal representatives have called for a review of the Thaba Manzi CCMA ruling and his spokesman, Ahmed Elgarib, denied yesterday the latest allegations of nonpayment.

Elgarib, responding to questions put to him, said the allegations were the result of “people acting against foreign investors in [South Africa]”.

“As a member of the [Al Otaiba] group with several businesses worldwide, I can only confirm that all our payments are made for services we receive,” he said.

Referring to Huddlestone’s claim, he said the pilot should “reach out to my accounts team” rather than the media.

However, Webster has a file full of correspondence that tells a different story.

The financial blow he suffered from the Edward contract had a knock-on effect on his staff, because the 40-strong team he started with had to be whittled down as the agreed instalments were repeatedly delayed and had then dried up completely, he said yesterday.

“I carried on paying my remaining guys and for building material out of my own pocket and then, when they suddenly put a hold on the contract and disappeared [allegedly] without paying, I had to sell my vehicles and I was declared insolvent.

“I’m only just recovering today, nearly 10 years later.”

Webster said he had never met the sheik and had been instructed on site by his architect son.

“After that, I just worked through the management at The Edward.

“I would print out my invoices, physically hand them over at the hotel and they would e-mail them to the sheik’s South African office in Cape

They suddenly put a hold on the contract and disappeared without paying

Town.” After asking him to tender for the renovation work and approving it, they had stopped written communication to him but acknowledged the different projects and quotes by continuing to pay the necessary deposits, he said.

Webster’s invoices include R346 600 alone to renovate the grand “His Excellency’s Suite”, in which the sheik stayed when he visited and which was subsequently let out for R35 000 a night.

He also renovated the bridal suite, the front facade, the restaurant and the distinctive courtyard of the hotel, and was in the process of working through the Edward’s 100 rooms and multiple balconies.

It had been a great contract to get but payment problems had emerged and quickly got worse.

Webster noted in a March 31 2009 letter to the sheik via the hotel’s general manager “... scaffolding hired at my expense” and “my staff have not been paid for a week.

“When can I be paid my [instalment] of R50 000?” he queried.

In July that year, he wrote that he was “owed R616 000 on this contract ...

“The Edward Hotel must pay for my time that I was put on hold for or pay my contract value out with all outstanding moneys and interest.

“I presently owe vast amounts of money to my workers who I have been trying to support but I am now in dire straits,” he wrote.

In the midst of these pleas, determined to honour the contract from his side, he pushed on with the job and had accumulated R1 171 540 worth of unpaid bills when he was summarily told the project was on hold.

After that, the sheik’s team had just disappeared, he said.

“They closed down The Edward and their headquarters in Cape Town and neither I nor my attorney could get hold of them, and eventually the matter was legally redundant and they had to close it off.”

Huddlestone, a respected helicopter charter pilot, said he had undertaken a pre-paid flight on May 20 over Blaauwbosch to allow his passengers, members of the sheik’s team, to do a game count.

At the sheik’s instruction, the flight was hurried to cut the charter cost, but when they touched down and the game counters told the sheik the figures, he was angry.

“There were many fewer animals than there should have been so he said we must go up again,” Huddlestone said.

While waiting to do this flight, Huddlestone took up two young women, friends of the sheik’s son, for a short flip, at their request.

Then he picked up the census team again.

“We flew for an extra 40 minutes in all and that included having to divert at the end because of fog to touch down at the Swartkops police station. The cost for this extra flying time was R5 654.”

Huddlestone said he normally called for payment up front for flights, but had been assured he would get his money and had trusted there would be no problem.

However, he received an e-mail three days later from a member of the sheik’s team, Joey Oosthuizen, saying he was dissatisfied.

“Nobody informed His Excellency that there will be additional charges,” she wrote.

Huddlestone challenged this response, but has still not received his money.

He said although the amount was relatively small, he felt it was important to speak out about it.