Settlement reached with CAO

Town of Peace River sued by Bunn, parties settle out of court

Susan Thompson
South Peace News

A long-standing legal battle over severance between the Town of Peace River and former Chief Administrative Officer Kelly Bunn has finally ended.

Bunn was let go from his position as the Town’s CAO in April 2015 after a performance review. In response, he sued the Town.

Bunn’s performance review was one of the recommendations of the independent Cuff inspection of the Town conducted in 2014. The report explaining the findings of the Cuff inspection is still available online on the Municipal Affairs website.

It lists several problematic issues with Bunn’s contract, such as the high level of Bunn’s compensation, the length of the contract at nine years, and the requirement for the Town to pay him two full years of salary for termination without cause.

The report points out the contract for CAO was not actually granted to Bunn himself, but to his company, Avant-Garde Inc. That meant Bunn was never actually a direct employee of the Town, but rather an employee of a subcontractor working for the Town.

The report also identifies additional issues affecting how the Town was being run, like the general lack of trust between the mayor and CAO, Bunn’s ongoing close relationship with the previous mayor. Lorne Mann, and the inherent conflict of interest in Bunn’s other role as a private developer in Peace River.

After the report was originally released, the Town followed the report’s recommendation to conduct an independent performance review of Bunn within 60 days. Holtby & Associates completed the review, and the previous council then voted against keeping Bunn as CAO.

At the time, Mayor Tom Tarpey told radio station Kix FM the motion to remove Bunn included direction to provide him with “adequate compensation in lieu of reasonable notice.”

However, Bunn launched a lawsuit seeking severance for termination without cause.

Bunn’s annual salary as per his original contract was $250,000 a year with benefits, possible bonuses, a vehicle allowance and a potential percentage increase due to inflation at the discretion of council. The payout for termination without cause was two years of salary at that rate according to his contract, and Bunn sought $500,000 in the suit, as well as just over $40,000 in legal costs.

Bunn and Avante-Garde Inc’s first two attempts to obtain a “quick claim” for the money were denied due to the complexity of the case, and in 2017 the plaintiffs were ordered to pay the legal costs for the first claim attempt and the follow-up appeal.

But the lawsuit did not ultimately end up going to court. The Town of Peace River agreed to settle the suit in September.

As documented in the minutes of the Sept. 23 town council meeting, Councillor Byron Schamehorn moved that council ratify the settlement agreed to in principle by the Town and the two plaintiffs, Bunn and Avante-Garde Inc.

Settling the suit was recommended by the Town’s own legal counsel.

Although the Town had previously gone in camera for a private meeting, the council meeting was opened to the public again shortly after 9 p.m. for the passing of the settlement motion.

Town communications coordinator Autumn Hulme says staff had already gone home for the night so that portion of the meeting was not included in the council audio recording released to the public.

The settlement includes non-disclosure agreements that legally prevent all those involved from speaking about the details.

“Non-disclosure agreements are stipulated by both parties so it’s not something where the Town is trying to be secretive,” says Councillor Don Good.

“People say they’d like to know. That’s understood. But the law precludes comments,” Good says.

“It would be nice if everything could be out in the open totally. A lot of us would be more comfortable if that was the situation but unfortunately that’s not the reality of the world, or the law, or politics.”

Current contract questioned

Current CAO Chris Parker’s contract was just ratified by council on Nov. 12. The contract raises Parker’s compensation to $184,814 from $181,190 a year, plus 20 per cent in benefits, and is valid until Oct. 31, 2022.

The contract states if the CAO is terminated without cause, he is entitled to one year of base salary as severance, plus another 20 per cent of his salary as compensation for the value of his benefits, plus unpaid vacation time. If he is terminated with cause he receives no compensation.

In comments on Facebook in response to the South Peace News article on Parker’s contract, former Northern Sunrise County Reeve Garrett Tomlinson questions why Parker’s compensation is over $220,000 with benefits, if Bunn’s compensation at $250,000 a year was considered too high in the past.

“Seems pretty hypocritical to me,” Tomlinson says.

“I think comparing an independent contractor with full-time employee staff is apples to oranges to start,” says Schamehorn.

“The other thing is after an election, it’s a new council,” he adds. “It is a new council and their decisions are their own, and the previous council’s decisions are their own.”

Tarpey acknowledges some people “tried to make political hay” out of Parker’s increased compensation, but says those people are not residents of Peace River.

“If you look at it on a percentage basis it comes out to something like 2.1 per cent, which is in line with the exact same per cent increase that was negotiated by the union and we applied that to all of the employees to be fair and equitable, including our CAO,” Tarpey says.

“Mr. Parker’s performance reviews were all positive from all members of council and I think we can share that. The vote to renew the contract was unanimous,” says Tarpey.

“To help with the evaluation we bring in an outside evaluator so it’s not us stacking the deck in favour of keeping someone around,” Schamehorn says.

“So for my own personal edification, I just asked him, you do these all the time, dozens and dozens of them a year; do we have a good CAO in your opinion? And he said doing this for the amount of time I’ve done, you’ve got a wonderful CAO.

“They’re not growing on trees,” Schamehorn adds.

He says attracting and retaining qualified CAOs to the north can be difficult without being able to offer all of the amenities of a big city.

“I love Peace River and I’m really happy to live here, and driving into the valley, it’s going to be as addictive as you can imagine … but to bring in somebody else equal or more qualified or whatever imaginary or wishful results people might be hoping for, it’s going to cost.”

According to municipal neighbour Northern Sunrise County’s consolidated financial statements, in 2016 while Garrett Tomlinson was reeve, then CAO Peter Thomas received a total salary with benefits of $226,343. Thomas stepped down in 2017, and received a total of $481,014 that year.

Meanwhile, in 2018 current Northern Sunrise County CAO Cindy Millar received $200,169 in total compensation including benefits.

Bunn had not responded to a request for comment by press time.

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