Come By Chance rudderless after council implodes over conflict of interest controversy

The Town of Come By Chance has lost its last remaining town councillor following a divisive and tanglydispute that saw four members dismissed earlier this month for alleged conflict of interestand another turfed last fall over residency requirements.

A message on the town's Facebook page late Tuesday morning confirmed that acting mayor Kathy Paul had quitand said town staff are working with provincial officials to establish a path forward for a community seized by controversy.

CBCNews has been unable to reach Paul, but town managerColin Holloway confirmed she has resigned.

Holloway said it was his sense Paul was "feeling overwhelmed with the responsibilityleft to her as one councillor in office" and that she "felt it was too much for one person as a volunteer to handle."

Paul's departure is the latest setback for Come By Chance, a prosperous community of just over 200 citizens in a heavily industrializedarea of eastern Newfoundland.

In recent years, there's been a revolving door of municipal staff and elected leaders at the town office, including an ongoing court case involving a former town manager accused of defrauding the town of tens of thousands of dollars.

"I would say the town has some significant challenges before it," said Holloway, adding,"it will be difficult to get anybody to put their name forward with the current state of affairs."

Holloway said one of the options being considered is the appointment of an interim administrator for the town while plans are made to attract council candidates.

He said the day-to-day operations will continueand there's no threat to municipal services.

• Protest in Come By Chance puts town's cash woes, council troubles in spotlight

Kathy Paul's resignation, meanwhile, comes less than two weeks after she delivered a controversial finding in a conflict of interest investigation, one that ended with four members of council, including the former mayor,having their seats vacated, leaving Paul as the lone elected member ofthe seven-seat town council.

The dismissals ignited a storm of controversy in the community, with dozens of citizens attending a public meeting at the local Lions Club on Thursday in which an official from the Department of Municipal and Provincial Affairs gave a presentation on the rules surrounding conflict of interest for municipal leaders.

A tense public meeting

According to a spotty Facebook Live feed that failed before the meeting ended, the tone was tense as residents tried to get answers about the dismissals.

Kathy Paul's daughter, Jasmine Paul, said the anger at Thursday's meeting helped influence her mother's decision.

In a direct message on Twitter, Jasmine said "what they did to us on Thursday night was enough."

Jasmine Paul had indicated her intention to run in an upcoming byelection for the town, but has since withdrawn, she said.

Thatlatest spat erupted after a Feb. 3 meetingin which former mayor Keith Best, his son Matt Best, deputy mayor Ralph Slade, and Lew Baker were dismissed from council in a report presented by Kathy Paul. Slade is Baker's son-in-law.

Carol Molloy, who is engaged to Matt Best, was dismissed last fall because she did not meet residency requirements, said Holloway.

Holloway said another member, Kim Downey, resigned recently after she no longer met the criteria for serving on council.

All seven were elected in the Sept. 28 municipal elections.

Marina expropriation

The conflict of interest relates to a pair of meetings in October, involving an attempt by the town to expropriate land on which a local marina and former oil refinery cargo wharf is located.

Keith Best and Lew Bakerare directors with the Come By Chance Recreation Boat Owners' Association, which operates the marina. Over the years, the association has received funding from the town, according to a report presented to council during the Feb. 3 meeting.

The report says Holloway discussed conflict of interest rules with councillorsduring one of the October meetings, but the four councillors did not declare a conflict, and cast votes on the expropriation motion.

Holloway said council received approval from the province to investigate the alleged conflict of interest, with Kathy Paul and Kim Downey leading the investigation.

After Downey's resignation, Paul proceeded on her own, again with permission from municipal affairs, said Holloway.

According to Section 207 of the Municipalities Act, it is improper for an elected municipal leader to vote or speak on a matter where a councillor has a monetary interest. The same goes for a councillor who is a member of an association that has a matter before council, and has a monetary interest in that matter.

What's more, the act says a councillor cannot vote or discuss a matter where a relative of the councillorhas a monetary interest in the matter.

In her report, Paul described the investigation as "challenging" and that the decision to dismiss her fellow councillors "is not made lightly,but with an interpretation of the legislative requirements under the Act and in the best interest of the community."

Lew Baker denies any conflict

The investigation found that because Keith Best and Lew Baker are members of the boat owners' association, and Matt Best and Ralph Slade are related to Keith Best and Lew Baker, that they should have declared a conflict of interest.

"The Come By Chance Recreation Boat Owners' Association has received and continues to receive monetary benefit from the Town of Come By Chance in the construction, regular maintenance and purchase of insurance at the marina," the report states.

Keith Best could not be reached for comment, but Lew Baker denied being in a conflict of interest when reached by phone on Tuesday.

Baker said the town received a legal opinion, saying the councillors were not in a conflict of interest, but that legal advice is not included in the Feb. 3 report because of solicitor-client privilege, said Holloway.

Holloway would not comment on the legal advice, but said Kathy Paul "would have looked at a number of things" in order to reach a decision.

Holloway stressed he did not have any involvement in the decision to dismiss the four councillors.

"It's a council decision," he said.

The four dismissed councillors have 21 days to file an appeal to the trial division of the Supreme Court of Newfoundland and Labrador.

Lew Baker said he's consulted a lawyer and he "most definitely" will appeal, saying he feels his reputation has been harmed after 50 years of volunteer service to the town.

"If this wasn't so damn serious, it would be funny," he said, adding, "I'm certain we will be exonerated."

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