Independent auditor to investigate shire legal costs
THE TOODYAY Shire Council has ordered an independent inquiry into the cost of suing former shire CEO Graham Merrick for alleged financial wrongdoing after the shire provided “inaccurate and misleading” information to an official Freedom of Information request last year.Read more
The audit follows questions raised by the Toodyay Progress Association over a claimed $36,000 discrepancy in shire accounts when the council spent at least $570,000 over a period of four years in a failed attempt to recover $151,000 from Mr Merrick in the WA Supreme Court.
The shire agreed to settle the case with Mr Merrick for an undisclosed sum that was thought to be about $20,000.
There was no admission of liability.
Mr Merrick’s legal and settlement costs were paid by local government insurance but the shire had to pay all its own bills.
The Toodyay Progress Association filed a formal Freedom of Information request to the shire last April calling for the release of all costs relating to the failed legal action against Mr Merrick.
Shire CEO Stan Scott responded by sending the association a photocopy of a Perth car parking receipt for $10.
Former shire president David Dow – who lost his seat in last October’s council elections – refused to answer ratepayers’ questions in council, saying a confidential deed of settlement between the shire and Mr Merrick barred the shire from revealing its legal costs, a claim disputed by Mr Graham under local government law.
However, after receiving a “preliminary view” from the State Information Commissioner urging far greater disclosure, the shire agreed to release substantially more documents, including what the shire described at the time as “inaccurate and misleading” costs.
Councillors voted 7-0 last month to address the Toodyay Progress Association’s concerns by authorising Mr Scott to arrange an independent audit “of the accounts to do with the Merrick matter”.
The recommendation – which was drafted by Mr Scott and moved by Cr Paula Greenway – said the audit should cover “reconciling this expenditure, council satisfying itself that the appropriate approvals were granted for this expenditure and council satisfying itself that no incorrect payments were made”.
Cr Ben Bell proposed an amendment that the audit report be made a public document so that ratepayers could also see the report when it was received and presented to the next available ordinary council meeting.
Cr Greenway objected to the amendment but it was seconded by Deputy President Therese Chitty and carried 5-2 with Cr Greenway and Cr Judy Dow voting against.
However, the amendment vote was recorded incorrectly as 7-0 in unconfirmed minutes signed by Mr Scott and published on the shire website two days later, and Cr Bell’s successful amendment that the audit result be made public was omitted.
The minutes can be corrected and confirmed at the next council meeting at 4pm on Tuesday March 27.