Coleman blasts CBC on Humber Valley Paving

James McLeod
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Says it was ‘gross misrepresentation’

The fight around a controversial roadwork contract linked to incoming premier Frank Coleman flared up again Monday, following a CBC report that stated he benefited personally from the government’s decision to let Humber Valley Paving out of a money-losing contract.

Coleman, speaking to The Telegram, batted back at the CBC and the Liberals who have led the charge on the Humber Valley Paving issue, saying the news coverage over the weekend was “gross misrepresentation” of what actually happened.

“I cannot imagine a bigger fabrication of the truth than what I saw this past weekend,” Coleman said.

Company released from contract

Earlier this year, around the same time Coleman was making his leap into politics, his son Gene Coleman, had a conversation with Transportation Minister Nick McGrath about letting Humber Valley Paving out of a money-losing contract to do roadwork on the Trans-Labrador Highway.

The company had completed most of the work, but the project was disrupted by forest fires in Labrador.

McGrath let the company out of the contract and bundled the remaining work as part of a larger tender for this summer.

In the process, McGrath waived a pair of bonds valued around $19 million associated with the paving contract.

In a weekend interview with the CBC, Coleman acknowledged that as a company shareholder, he was one of the ones indemnifying the bonds if they ever got called by government.

Coleman said he believes the government never would have been able to call those bonds — first because the company never defaulted on the contract, and also because the forest fires were an extenuating circumstance that it couldn’t be held to the original contract.

Moreover, he said the notion from the Liberals and the CBC he and his fellow shareholders were potentially off the hook from paying $20 million to the government is wrong because most of the contract was already  satisfactorily completed.

“The government wasn’t in a position to call the bond whatsoever,” he said. “Nothing could be further from the truth. This is a job that had 60 per cent or two thirds done. There was maybe six or seven million dollars left on the job. We could have finished the job. It was not in default.”

In the House of Assembly, Liberal Leader Dwight Ball kept pressing the matter, wanting to know when McGrath found out Coleman was one of the people indemnifying the bonds.

McGrath said he didn’t know that until this past weekend when he saw the CBC report.

“I have no comment when it comes to personalities or individuals. I deal with the contractor. In this case I had options. I took the option that I felt was in the best place for the people of Newfoundland and Labrador,” he said. “Looking at where this 60 kilometres is located and the window of opportunity I had to bundle that with other work, I either had to make a decision to delay the other work and not get that contract out ... or bundle this tender. That’s the decision we made and we stand by that decision.”

New Democrat Leader Lorraine Michael said she’s satisfied to wait for the auditor general to complete his investigation into the situation. With questions swirling, Premier Tom Marshall formally requested the auditor come in and do an independent review of it all.

But Ball said he’s going to keep pushing for more answers.

“We’ll keep asking questions, and hopefully the auditor general will take some of the questions we’ve been asking today,” he said.

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Recent comments

  • Info.
    June 14, 2014 - 09:32

    I keep asking and know one seems to know but how long was the job shut down for because of the fires?

  • Sickened by Corrupt Governance and Bad Stewardship of our natural resources over the years.
    May 28, 2014 - 08:55

    It is not only the CBC and the Liberals! More importantly, it is the electorate of the province that finally has seen the light of what has been ailing them against creating an economy vibrant enough to run our services and infrastructure in our province. I hope the electorate's eyes don't close on surveillance and scrutiny of the politicians we elect. We now know we cannot let our Guard down for a moment.

  • Tim H.
    May 27, 2014 - 13:49

    I'm quite sure if there was anything that remotely leans towards defamation of reputation or character the lawyers would be all over this. Frank - "make the call" why don't you?

  • Torey Nomore
    May 27, 2014 - 11:01

    Entitlement and lack of accountability; reasons number 587,603 & 73,429 that I cannot vote Tory no-more.

  • Maxwell J.
    May 27, 2014 - 10:34

    I am somewhat surprised that the assertion Coleman benefitted financially is being met with such surprise. This is about special relief having been given to a corporation in which he was an owner either in the midst of that decision being made or immediately prior. I can assure you there would be no material difference. You don't buy a company with a $19 million contingent liability hanging over its head without reflecting it in the terms. So of course he benefitted financially. How could he not. So the question for the AG is whether the benefit conferred on the premier-in-waiting constitutes a departure from normal, prudent departmental policy in such matters. In other words, was the relief warranted. Had it not been granted by the minister, how likely is it that Coleman would have obtained the same relief in the courts. While this deal looks bad from almost every possible perspective, the public does not have all the salient facts. We must put our trust for the moment in the AG who, as we speak, is presumably searching for those salient facts. Incidentally, I do not believe there has been any timeline assigned to this investigation. Does anyone know if there is a target completion date? Finally I will say this. Whether or not the AG determines the relief granted to Coleman (and possibly even the $12 million paid out initially) was defensible, he will almost certainly condemn the manner in which it was orchestrated. He will, as a minimum, underscore the obvious omission that a government dealing with a matter so pregnant with the potential for conflict would not insist from the get-go that its decision be supported by independent legal advice and that it be thoroughly documented in the event of this very kind of controversy. Sending this to the AG might have bought this government and Mr. Coleman some time, but frankly the end result could well be the same. It is almost certain that the AG will determine that the prescribed protocols as laid down by the Financial Administration Act and other legislation and regulations of government - and indeed in compliance with business practices - were breached. Even without being asked to do so, this is exactly the type of situation that would attract the attention of the AG in the normal discharge of his mandate - that mandate being ultimately to protect the taxpayer. Where things go from there is anybody's guess, but it does not augur well for Mr. Coleman's pending stint as unelected premier. Nor does it augur well for the party planning his coronation.

  • Dwayne
    May 27, 2014 - 09:36

    Yes...."gross misrepresentation". We know that Coleman and his party have themselves grossly misrepresented re the HVP disgrace, so not surprising that he tries to deflect to elsewhere. Puppet strings still visible though Coleman.

  • Sam
    May 27, 2014 - 09:19

    I think Coleman and McGrath should sit down and get their facts straight or should |I say their story. McGrath on the one hand claims he acted independently when he released the Coleman's company from the contract in order to save the company. McGrath has also stated in the House that he didn't even know who held the bond on this contract. Says he learned it from the CBC interview with Coleman. Given his conduct in handling this entire matter, he should be relieved from his duties immediately. Coleman on the other hand is now trying to put a different spin on the CBC interview stating that there was no problem, or to quote the above article, "we could have finished the job it was not in default". If this is true, why were they seeking to be relieved from the contact? I find this whole issue to be both troubling and insulting to people of this province. If Frank Cole is behaving in this manner even before he is anointed, what can we expect after the fact. I guess his comment captured in the new yesterday re; privatizing the liquor stores is a sample of what's to come. I wonder who will get that contact, should it come to fruition????

  • Sick of the shills
    May 27, 2014 - 08:44

    ''Nothing could be further from the truth''? Lol, as soon as that tired old line is trotted out, you know there's something up..

  • concerned
    May 27, 2014 - 06:30

    There are 2 questions. Were the forest fires a force majeure item. If not, then they could not be considered a act of god, permitting HVP to delay or get out of the contract. The second was there a defined completion date in the contract. Were HVP in default? Coleman is painting a picture he wants the public to see, but it is not grounded in contract law.

    • Construction Guy
      May 27, 2014 - 09:45

      Sir/Madam (concerened): Those two questions, can and will, define the very essence of the matter. Those are indeed Contractural, Brilliant and Knowledgeable questions that should be asked of HVP/Coleman.

  • Doug
    May 27, 2014 - 06:30


  • Laurie Blackwood Pike (Grandpa Pike)
    May 27, 2014 - 06:27

    Wow! Coleman is coming out of his shell. I suppose he finally realizes that you must talk to 'the people', when 'the people' want ...not when you get around to it. One key phrase in his statement jumps off the page. "Nothing could be further from the truth." Didn't Danny say that in almost every interview and Press scrum? Looks like Frank is learning...but is it too little too late?

  • Dis' is normal
    May 27, 2014 - 05:19

    Disinformation IS the management method of modern state oligarchy. It is always openly employed by a power, or, consequently, by the people who hold a fragment of economic or political authority, in order to maintain what is established; and always in a counter-offensive role. Whatever can oppose a single official truth must necessarily be disinformation emanating from hostile or at least rival powers, and must have been intentionally falsified by malevolence. Disinformation would not be simple negation of a fact which suits the authorities, or the simple affirmation of a fact which does not suit them: that is called psychosis. Unlike the pure lie, disinformation -- and here is why the concept is interesting to the defenders of the dominant society -- must inevitably contain a degree of truth but deliberately manipulated by a skillful enemy. The power that speaks of disinformation does not believe itself to be absolutely faultless, but knows that it can attribute to any precise criticism the excessive insignificance which is in the nature of disinformation, and of the sort that it will never have to admit to a particular fault.