PARAMOUNT Garment Works has escalated its dispute with insurer Alliance Insurance to the High Court, demanding enforcement of a commitment to rebuild its fire-destroyed Southerton factory, finance director Jeremy Youmans told Business Digest.
“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,” he said.
The December 2023 blaze caused up to US$25 million in damages, but despite Alliance accepting liability in January 2024, no reconstruction has begun.
“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,” Youmans added.
However, Alliance said it had honoured its obligation to pay for damages.
“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.”
According to the agreement, Alliance is supposed to pay the damages and is obliged to provide the necessary repairs to Paramount’s gutted factory.
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In January, Paramount made a formal complaint with the Insurance and Pension Commission, over the case.
Youmans said the company was now relying on other stakeholders that were helping them and that the failure by the insurer to settle damages had affected production.
The company supplies garments to regional and international markets.
