The New Brunswick Opposition Conservatives plan to file an official complaint with the province's conflict of interest commissioner against Premier Shawn Graham regarding the Atcon Group.
They want a ruling on whether Graham should have removed himself from cabinet discussions last June, when cabinet decided to give $50 million in loan guarantees to the financially troubled company.
Graham's father, Allan, sat on the board of an Atcon subsidiary, Vanerply, in Sweden.
'The fact that his father has been on the board of one of the Atcon companies clearly raises issues.' —Opposition Leader David Alward
Business New Brunswick Minister Victor Boudreau has said that Graham's father resigned from the board before the loan guarantee decision.
Nevertheless, Opposition Leader David Alward contends the premier should not have played a role in the decision.
"The fact that his father has been on the board of one of the Atcon companies clearly raises issues," he said.
"And it should be the premier that makes that decision whether he was in conflict, and he should have made the decision to remove himself, and it's very unfortunate that the premier did not show leadership in that."
Graham's brother, Andrew, also used to work for the Miramichi-based construction company, but left before the Liberals took office in 2006, according to Boudreau.
Minister's ties also questioned
The Opposition is also questioning Public Safety Minister John Foran's ties to Atcon.
Foran, who is from Miramichi, had told the local newspaper he has relatives who work for Atcon.
On Thursday, Conservative MLA Claude Williams asked Foran if he was referring to his brother.
Foran didn't answer, but Boudreau said the Opposition's question hit a new low.
"New Brunswick is a small province of 750,000 Mr. Speaker. And we can find family links and friendship links all over the place, Mr. Speaker."
The conflict law prohibits MLAs from personally benefiting from decisions, Boudreau stressed.
But it also prohibits them from taking part in decisions that benefit another person's private interests, which arguably could apply to Foran's brother.
The Opposition contends Foran should have erred on the side of caution and removed himself when cabinet approved the Atcon loan guarantee.
Two weeks ago, five Atcon companies were placed into receivership, while seven others were placed under creditor protection after Atcon's main lender, Scotiabank, called in its loans.
The court-appointed monitor, Ernst and Young, has been reviewing the Atcon companies, trying to find ways to restructure them, or sell their assets.
Atcon owes its creditors about $250 million.
A lawyer for the government told the Court of Queen's Bench in Miramichi Monday that the province will have to pay Scotiabank the $50 million and then seek repayment as a creditor.
Justice Thomas Riordon has given the owner of the Atcon Group until Monday to present the court with a plan to save one of the companies, Atcon Industrial, from bankruptcy. He hopes to save the estimated 50 to 100 jobs, he said.