Monday, 28 December 2015

PREMIER BALL RIGHT TO CALL FOR HUMBER VALLEY PAVING INQUIRY

Guest Post Written by Ches Crosbie

Newly installed Premier Dwight Ball went on record back in 2014, saying he wanted to see a judicial inquiry called into the Humber Valley Paving debacle.  And reassuringly, in December 2015, upon being sworn in as Premier, he issued a mandate letter to his new Minister of Justice instructing him to call an inquiry into the Humber Valley Paving “situation”. 

The deeply troubling spectacle of  Humber Valley Paving saw the Department of Transportation forgive Frank Coleman and his paving company up to $20 million in contracting liabilities, and release two bonds in the same amount, as Coleman was about to become the Danny Williams-anointed (and unopposed) candidate for the PC Party leadership and premiership of Newfoundland and Labrador. 

In September 2014, the auditor general released a report on the huge and unprecedented indulgence granted Coleman just days before Paul Davis won the PC Leadership Convention and became party leader and incoming premier in September 2014.  Coleman’s name was on the bonds which guaranteed completion of the Trans Labrador Highway work undertaken by his company, Humber Valley Paving.

In a September 30, 2014 post, highly regarded blogger Uncle Gnarley pronounced:

“How Premier Davis responds to the findings [of the auditor general] will constitute the standard of integrity that will mark his office.”

Uncle Gnarley added that after reading the report, he was “quite certain” that a judicial inquiry should be called forthwith. 

How did Paul Davis, after becoming Premier in October 2014, respond to the auditor general’s findings on the Coleman affair?  He refused to call an inquiry.  Whether this constituted a failure of integrity or not I will leave others to debate.  Davis never promised to call an inquiry, and therefore did not renege on a commitment.

But Davis’ decision not to shed further light on this shady affair was an early test of his leadership and a significant reason why he was defeated in the November 30, 2015 election, and is no longer Premier.  He failed to demonstrate a clear break with the PC past, and project to voters that he was following a new agenda of his own, instead of an agenda set by someone else.

As former U.S. President George W. Bush once said, if you don’t follow your own agenda, you will soon be following someone else’s agenda. And you thought George W. Bush was dumb!

The Province has a new government, and an early test of the standard of integrity the new government will set was whether Premier Ball did what both the public good and his own desire to expose the facts require him to do, namely call a judicial inquiry into the Humber Valley Paving scandal.  By mandating Andrew Parsons, his Justice Minister, to do exactly this, Premier Ball has passed this early test with distinction.

A judicial inquiry is needed because of the limitations the auditor general worked under, and imposed on himself.  The auditor general could look at documentation.  The auditor general could interview people likely to possess knowledge of the whirlwind, single day decision to allow Humber Valley Paving to exit what had become an onerous contractual obligation to finish the Labrador Paving Contract.  

The limitations inherent in “interviewing” people are that they are not under subpoena, not under oath, not under threat of purgery if they deliberately mislead, and most important of all, not exposed to cross examination, which is well understood by lawyers to be the most powerful engine for the discovery of truth known to the law.

As to review of documentation as a means of discovering the truth, the auditor general concluded that: “There is no documentary evidence of undue influence in the decision to mutually terminate the contract.”

But an absence of documentary evidence of undue influence is not an absence of undue influence.  Astonishingly, contrary to all good practice, there was no documentation surrounding the decision to cancel the contract whatsoever! 

The auditor general allowed himself to be checkmated by a complete lack of documentation surrounding the decision to terminate the contract, a lack of documentation which many think is so contrary to all sound management control and accountability practice in government as to suggest a deliberate cover-up.

Judges are skilled at making inferences from incomplete and absent evidence.  A missing paper trail, where extensive documentation is normal practice, would not stop a judicial commissioner from drawing the necessary conclusions as to undue influence or as to any other issue.

The auditor general added:

We have not been able to satisfy ourselves why two Ministers, within one half hour,  independently contacted the deputy  minister of transportation and works to inquire about the status of HPV on the morning of March 13, 2014.

We have not been able to satisfy ourselves why the process to come to an arrangement with HPV to terminate the contract…had to be concluded the day before the nominations closed for the leadership of the progressive conservative party of Newfoundland and Labrador.

Clearly, the auditor general’s staff interviewed the two ministers, and was not “satisfied” with their explanations, but having no documentation to explain the situation, could not answer what impetus initiated the process on the morning of March 13, 2014 whereby the contract was terminated by the end of the day.  Nor could the auditor general establish why the termination was urgent, or what involvement the Premier’s Office might have had.

Incredibly, the report also found that Transportation Minister Nick McGrath instructed his deputy minister not to inform the Premier’s Office of the decision to cancel.  And the deputy minister complied!  According to then Premier Marshall, he found out about this six weeks later. This led to the finding by the auditor general that:

Minister McGrath knowingly withheld information from the Premier of Newfoundland and Labrador related to the decision to mutually terminate the contract.

The presence of protocols in government aimed at ensuring the Premier knows of significant decisions, and in particular, politically significant decisions, before they are made, has caused eyebrows to arch at Marshall’s denial of knowledge.  But his failure to immediately fire McGrath on learning of his deception caused a collective shaking of heads.  Instead, McGrath was left in cabinet for a further six months, until a new Premier Davis told him he could jump or be pushed.

Just what precipitated the whirlwind of decision making aimed at letting Frank Coleman’s paving company off the hook for liabilities in the millions and transferring them to taxpayers, on the day before he was to put his name in unopposed as candidate for Premier, remains a mystery shrouded in an enigma.  

Whether undue influence was indeed exercised remains unresolved, and respect for good governance has caused Premier Dwight Ball to now undertake what Premiers Tom Marshall and Paul Davis failed to do: initiate a judicial inquiry to expose just why and how it all happened.  By taking this decision, the Ball government has signalled a new commitment to integrity in government and respect for the public trust.  

The same public trust requires that the terms of reference for the inquiry ensure that no significant question about the astonishing Humber Valley Paving affair remains unanswered.
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Ches Crosbie is a personal injury lawyer and owner of Ches Crosbie Barristers, St. John’s.

3 comments:

  1. I did some face checking and all the people who were questioned by the AG were under oath. The AG also had Lawyers present who cross examined those involved.

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  2. Agreed that this was a totally shady deal that should be investigated. However there is a misconception out there that the province lost the opportunity to collect $19 million which is totally false. From memory HVP completed 60% of the work to the satisfaction of the government (ie no deficiencies to be corrected) and were paid 60% of the value of the contract (approx. $11.4 million). With HVP refusing to come back and complete the remaining 40% of the work the government was forced to retender the outstanding work. I understand that the tender for the remaining 40% came in approximately $2 million higher than the value of the remaining 40% of the HVP contract. Had the bonds not been released, the government would have been in their rights to go after the bonding company for this additional cost ($2 million) to complete the project. Never would the government been able to get the $19 million or even 40% of it (the value of the uncompleted work).

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    1. Your analysis that the taxpayer had to forgive only (only) $2 million may well be correct. My impression is that because of bundling with other work of the contract to finish, this is difficult to establish. Where I come from, $2 million is real money.
      As to oaths to tell the truth, these are mainly for show and mean very little. Cross examination can mean a lot more, but if it occurred, there is no indication of it in the text of the AG report, or in the inferences drawn (or not drawn) as to truth telling.

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