Liberal Leader Dwight Ball says his party is getting calls from around a dozen contractors who say they’ve been put in a bind by the government’s decision to cancel a controversial paving contract linked to premier-designate Frank Coleman.
The Liberals say that with the cancellation of the road building contract, the only choice for companies dealing in good faith with Humber Valley Paving is to go to court.
“We’ve been in contact with quite a few subcontractors,” Ball said. “There’s about a dozen right now that we’ve been talking to, and varying amounts of money that’s outstanding on the project.”
Due to forest fires in Labrador last summer, Humber Valley Paving was unable to complete a contract to pave 80 kilometres of the Trans-Labrador Highway without losing money.
The company was owned partially by Coleman, who will take over as PC Party leader and become premier in July.
Around the same time that Coleman was getting into politics, his son, Gene Coleman, who was also on the Humber Valley Paving board of directors, negotiated directly with Transportation Minister Nick McGrath before the company was let out of the contract.
Premier Tom Marshall insists nothing untoward happened, but for the sake of public confidence has referred the whole affair to the auditor general to do an independent study and clear the air.
Ball said that by waiving two bonds worth $18 million and quietly cancelling the contract without telling anybody, suppliers to Humber Valley Paving won’t get paid.
The suppliers could’ve put a lien against the company, he said, and then they would have had recourse to get paid, but they didn’t know the contract was being cancelled.
Ball said sub-contractors were expecting to go back to work for Humber Valley Paving again this summer, so they didn’t put in a lien because they were operating in good faith.
McGrath said that if the companies didn’t put in a lien within 30 days of completing their work, they’re out of luck.
He said the Liberals are acting like his decision to let the company off the hook for the contract made a difference, but because the companies didn’t put in a lien within the 30 days, they wouldn’t have recourse regardless of whether the government chose to waive the company’s bonds.
McGrath said that as a former small business owner, he knows that going to court is tough, but he said that’s also a part of doing business.