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A guarantee letter for 450,000 euros, bearing the signature of former Center Party secretary general Priit Toobal, of which the party leadership learned no more than a month ago, could lead to a worst case scenario of seizure of property, frozen bank accounts, and compulsory retirement of the chairman post haste.
The public learned of the guarantee letter signed by Toobal when he was still working as secretary general (he left the party and the Riigikogu after his harassment scandal) yesterday. The letter to long-time Center Party campaign master Paavo Pettai's company Midfield promises the party's help should the company find itself in dire financial straits.
Other members of the board were completely oblivious as to the letter's existence. It is the first time the Center Party has had to deal with such a letter. The board will most likely order an expert analysis of the letter when it convenes for an extraordinary meeting on Monday. Preliminary assessments from some board members suggested that the A4 printed document and the corresponding guarantee might not have legal power. The board is convinced that Toobal overstepped his powers as secretary general by signing off on such a large sum.
Even though every board member and the secretary general are authorized to sign agreements on their own, sums must not exceed 25 percent of annual revenue. The almost half a million euros pledged by the document in question comes closer to a third of the party's revenue however, making it a non-binding obligation. «We would like to believe that the paper is null and void, and that no one has to take responsibility,» several board members said yesterday.
Midfield, that is to say Pettai, can sue the party, as the indebted company will surely want its money back. That could lead to asset seizures, and should Midfield apply for preliminary legal protection, also the freezing of the party's accounts. Once the case reaches the courtroom, responsibility will either fall on Toobal alone or the entire party. It is hoped that not all board members will be involved as they had no prior knowledge of the letter.
Allegedly the document has been discussed with party chairman Edgar Savisaar on numerous occasions. Rumor has it Toobal was once again a simple straw man who signed the guarantee letter before thinking the matter through.
Midfield could demand the return of money it has allegedly spent after borrowing it from third parties who now want their contributions returned.
Next week will tell. The party will launch an investigation and probably create another truth committee.
It is also whispered that Savisaar's lawyers showed the document to Secretary General Oudekki Loone already a month ago, while the broader circle had no prior knowledge.
The Center Party has paid its debts to Midfield regularly, which begs the question whether this debt is something else?
Should Midfield declare bankruptcy, the document will surely find its way into the hands of the trustee who will then try to collect the money. Even if the party will succeed in identifying the document as null and void, it does not exempt it from potentially having to face litigation.
The case will surely undermine Savisaar's position as chairman. It is claimed Savisaar is greatly disturbed by the document surfacing. Conspiracy theories suggest that behind the letter there are real people, companies that have also been searched and been under surveillance, and that it cannot be ruled out some of these legal or physical persons have given statements to the Estonian Internal Security Service. It is possible they have been exempt from criminal responsibility as they have made deals or will appear in court as witnesses who will claim the money actually went somewhere else.
Here we can ask why some people cling to their position in the party so desperately. Savisaar, financial manager Kalev Kallo, and also Toobal for as long as he could.
Kalev Kallo said that he knows nothing of the letter. «I really do not know. There is no clarity right now, and I do not know how it was crafted. When the party will convene to discuss these matters beginning of next week, it will be the first time I will hear these explanations,“ Kallo affirmed. „I do not think the whole affair is as serious as it is being made out to be. One person cannot give such a guarantee in the name of the board. The document is either void or something like that. I really cannot tell you any more than that.»
Center Party Deputy Chairman Jaanus Karilaid explained that the party has not issued such a document. «The signature has been given in the board's name; however, it is very likely the board was not aware of its existence,» he said.
«It has now come to light, and members of the board who have been informed will honor due diligence and act in an operative fashion. We want to get as much transparency as possible in terms of why was the letter signed, whether the board has authorized it, what legal and financial effect could it have on our budget,» Karilaid said.
The board of the Center Party will convene on Monday evening to shed light on the document and discuss the party's financial situation. The party's PR chief said that neither Savisaar, Toobal, nor Loone will be available for comments before next week.