Humber Valley Paving suing province, other company for unpaid contract

Humber Valley Paving is suing the province for hundreds of thousands of dollars, claiming it hasn't been paid for work it did in southern Labrador, unrelated to the contract government let the company out of earlier this year.

The company was in chargeof providing a work camp in southernLabrador for Mike Kelly & Sons Ltd. construction company, while that companyworked for the province to widen parts of a road to get ready for pavement.

Earlier this year, companies in southern Labrador accused Humber Valley Paving of failing to pay its bills.

In court documents obtained by CBC News, Humber Valley Paving is seeking to recover$446,006.

The dispute is between Humber Valley Paving and the other company, but a spokesperson with Transportation and Works said the province is named in the claim as the owner of this work.

The province withholds a certain amount of money from a contracted company to ensure subcontractors are paid.

"If the contractor and sub-contractor cannot come to a settlement, the provincial government will apply to the court to release money from the holdback and pay the necessary amount into the court to have the mechanics lien lifted," said the spokesperson.

Michael Coleman is listed at the director of HumberValley Paving, and also works for the Coleman Group of Companies, but told CBC News he knew nothing about the lawsuit.

Premier happy with other contract investigation

Meanwhile, Premier Paul Davis said Thursday that unless more information comes forward, there will be no more investigations into the controversial decision to terminate a substantial road paving contract with Humber Valley Paving.

In an interview with On Point with David Cochrane, Davis expressed complete confidence in a review carried out by Auditor-General Terry Paddon.

"He has carried out a very thorough investigation," said Davis. "He's a very competent person who runs a very competent office that is very independent."

Paddon's report was released Monday and prompted the resignation of former Transportation and Works minister Nick McGrath.

Since then, there have been calls for a judicial inquiry, and suggestions that "outside influences" were at play in McGrath's March 13 decision to let the company out of a roughly $19-million contract to pave a section of the Trans-Labrador Highway before all the work was completed.

Work on the contract was being hindered by severe forest fires in Labrador during the summer of 2013, and the company asked to be let out of the contract.

The government also decided against calling in a $9.5-million bond, or insurance, secured by the company in the event it might not be able to finish the job.

Options not explored

The auditor-general said the decision to cancel the contract was not appropriately documented and was pushed through in just a few hours.

Paddon said McGrath made the decision without telling senior government officials, including then-premier Tom Marshall, and without thoroughly exploring other options.

All this unfolded the day before the close of nominations for the leadership of the Progressive Conservative party.

Hours later, Frank Coleman, a one-time president and CEO of Humber Valley Paving, announced he would be seeking the party's leadership.

Coleman eventually withdrew from politics in June, just weeks before being sworn in as premier, citing personal reasons.

There have been suggestions from prominent political commentators that Coleman's team was hurrying to tie up any lose ends before his entry into the leadership race, and that McGrath was under pressure to get the contract cancelled.

Paddon never reached this conclusion in his report, but referenced certain gaps, including why McGrath and fellow cabinet minister Kevin O'Brien called the deputy minister of Transportation and Works within a half-hour of each other on March 13.

Both McGrath and O'Brien were very public in their support of Coleman's candidacy for party leader.

Davis said he spoke with O'Brien, who was then responsible for the Fire and Emergency Services agency, and accepted his explanation that he called the minister because of concerns about the fires in Labrador.

As for McGrath, Davis has said he would have fired the MHA for Labrador West from his cabinet, had he not resigned.

"The results of (the auditor-general's report) point out a circumstance where minister McGrath should have done a more diligent piece of work before making the decision that he made, and he failed to do that work. And that's the picture that's painted by this investigation," said Davis.

The premier said the auditor-general has the authority to forward matters to the police for further investigation, but decided not to in this case.

Davis noted: "I believe the investigation has been done."

When asked about suggestions that McGrath was taking direction from those close to the Coleman campaign, Davis said the auditor-general's report shows no evidence of this.