Paramount, Alliance dispute over redress spills into court

Published: 14 hours ago

Paramount Garment Works has taken its dispute with Alliance Insurance to the High Court, seeking enforcement of what it says was the insurer's commitment to rebuild its Southerton factory destroyed by fire late last year.

The company's finance director, Jeremy Youmans, said the case was now before a judge after months of stalled reconstruction despite Alliance accepting liability in January 2024.

"We are involved in an arbitration process on the claims for losses and will be in the High Court where we have applied for an order for the insurance company to rebuild the warehouse building destroyed in the fire as they had originally elected to do," Youmans told The Herald.

The December 2023 inferno caused damages estimated at up to US$25 million, crippling operations. Youmans said that although Alliance had acknowledged liability at the start of the year, no work had begun on rebuilding the gutted structure.

"Nothing has been done on the construction, and we are trying to operate without the building. The case was heard, and we now await the judge's decision," he said.

Alliance Insurance, however, maintains it has met its obligations. In a statement, the company said it could not discuss the matter in detail while proceedings were ongoing.

"The matter is before the courts and therefore, I cannot go into detail. In addition to that, we are bound by confidentiality and data protection regulations, hence we cannot discuss client affairs to the media and third parties," the company said.

"For the record, we have not broken our obligation over and over again, delayed payment, or failed to pay. We are in the business of paying claims. However, there is a dispute between us which the court has to preside over and rule."

Under the insurance agreement, Alliance is obliged to cover damages and carry out the necessary repairs to restore Paramount's factory.

In January, Paramount lodged a formal complaint with the Insurance and Pension Commission (IPEC), citing the delays. Youmans said the stalemate has disrupted production, forcing the company to depend on assistance from other stakeholders to stay afloat.

Paramount Garment Works is a key supplier of clothing to both regional and international markets, and management warns that prolonged delays in reconstruction could undermine its competitiveness.
- The Independent

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