Manoel Theatre taken to court over chairman’s unauthorised contracts

Malta’s national theatre is being sued over six contracts signed by non-executive chairman Michael Grech in one day, which have already cost taxpayers over €500,000 before the chairman was ordered to terminate them.

The contracts were entered into without the necessary authorisation from the theatre’s board or the Finance Ministry, sources have confirmed, exposing taxpayers to a potential further €100,000 in damages as the architecture firm involved in the six contracts, AP Valletta Ltd, is suing the Manoel Theatre.

Through the services of Dalli Advocates – a firm owned by Minister Miriam Dalli’s sister, Veronique Dalli – AP Valletta is arguing that Grech terminated the six service contracts signed in 2019 without sufficient reason.

The firm also argues that the theatre failed to pay the 20% commission for consultancy fees as stipulated in the contracts, court documents show.

On its part, the theatre contends all fees, over €500,000, had been paid by the time of the contract’s termination.

Yet a clause in the contracts states that upon termination, even if this is done without any reason given, “the client (Manoel Theatre) shall pay the consultant (AP Valletta) all fees due up to the date of termination and an additional 20% of such fees”.

AP Valletta is owned by architects David Felice and Konrad Buhagiar.

Grech, who specialises in commercial law and is a senior partner at GVZH Advocates, has not explained his actions. Grech did not reply to questions from The Shift or make any public statement.

The Shift is informed that Grech had been forced to terminate the irregular contracts by senior government officials after the irregularities were discovered – two years later.

Despite the blunder, which, if investigated by the police, could result in possible charges being filed against Grech over the misappropriation of public funds, Culture Minister Owen Bonnici has not taken action.

It is not yet known whether Culture Minister Owen Bonnici was informed about the irregularities before he reappointed Grech as Manoel Theatre chairman after the last general elections.

The minister also refused to reply to questions.

According to public procurement rules, government entities cannot enter into contracts without the finance ministry’s consent for direct orders or, alternatively, a competitive tender.

As a non-executive chairperson, Grech is not authorised to sign any contracts on the government’s behalf.

He was appointed chairman of the Manoel Theatre by a Nationalist administration over a decade ago. He is one of the few who managed to retain his position despite a change in government.

He was involved in other controversial decisions, such as the theatre’s financial support for Labour activist and producer Mario Philip Azzopardi.