Nfld. & Labrador

Ex-Nalcor chair says Dwight Ball knew of Ed Martin's severance

The former chair of the Nalcor board of directors says he personally told Premier Dwight Ball that Ed Martin would be paid severance prior to the $1.4-million package being approved by the board of directors.

Ken Marshall suggests paper trail shows top officials knew of payments

The former chair of Nalcor's board of directors says that he personally told Premier Ball of Ed Martin's severance package. (CBC)

The former chair of Nalcor Energy says he told Premier Dwight Ball and a top cabinet minister that former CEO Ed Martin would be paid severance prior to the $1.4-million package being approved by the board of directors.

In a media statement released Wednesday morning, Ken Marshall says both Ball and Natural Resources Minister Siobhan Coady were informed of Martin's severance package in an email prior to Nalcor's April 20 board meeting.

Marshall also says he personally discussed the severance payment with Ball on that day during a follow-up phone call held prior to the approval vote taking place. 

The statement also supports Martin's claims that the severance payment was approved with the government's blessing.

"The board was unanimous in this decision, and acted on the information provided from the meetings held between Mr. Ed Martin and the premier, minister of natural resources, and the premierʼs chief of staff held on April 17 and 19, 2016," Marshall wrote in his statement.

Confirmed in phone conversation: Marshall

"(The severance payment) was conveyed to the premier and minister by email prior to the commencement of the meeting, and confirmed in my telephone conversation with the premier prior to the vote taking place."

Confirmed in my telephone conversation with the Premier prior to the vote taking place- Ken Marshall

"The board, in unprecedented manner, advised the premier and minister of natural resources in advance of the board of directors meeting scheduled for 11 a.m. on April 20, 2016 of the items to be addressed at the meeting."

Marshall declined further comment and turned down requests for interviews. But he says he is turning over all relevant information and documents to the auditor general, who the premier has asked to investigate the severance controversy.

Marshall also said that he will not be releasing the email sent to Ball and Coady. 

"That review will rest with the auditor general," he wrote in a message to CBC News Wednesday afternoon. 

A paper trail?

Ed Martin left Nalcor in April, and received a controversial severance payment worth about $1.4 million. (Bruce Tilley/CBC)

A key revelation in Marshall's statement is the existence of a paper trail — in the form of an email — between the Nalcor board of directors, the premier and Coady discussing the board's belief that Martin was entitled to severance and that the government supported it.

Marshall and the rest of the board later resigned stating they felt they had lost the confidence of the government.

Marshall's claims come just hours after Martin released the full details of his severance package to the media.

The legal text of Martin's severance agreement explicitly states that the government knew about the payment — and agreed with it.

"The board of directors of Nalcor has been advised by the Government of Newfoundland and Labrador that in all circumstances it has agreed that (Martin) is entitled to his severance," reads the "settlement agreement."

It is dated April 20, the day Martin and Ball held separate news conferences announcing Martin's departure from the corporation.

However, the government released its own documents early Wednesday morning — one was a letter from Natural Resources Minister Siobhan Coady sent to the Nalcor board where she denies the version of events laid out in Martin's settlement agreement.

Current chair involved

A source tells CBC News that lawyer John Green helped draft Martin's severance agreement. At the time Green was a senior counsel with the firm McInnes Cooper offering legal advice to Nalcor.

But Green resigned that position on April 22 — two days after Martin's severance was finalized — when Ball appointed him chair of the Nalcor board, replacing Marshall.

"Nalcor does not provide or comment on legal advice received or sought," a company spokesperson said in an emailed response to questions about Green's role in drafting the severance agreement.

Ball has repeatedly denied that he knew the details of Martin's severance agreement or that he approved it. It's a claim that he repeated on Tuesday afternoon during an emotional statement to reporters.

"These are discussions that I was not part of. I was not asked to sign off or to authorize the severance package that was given to Mr. Martin," Ball told reporters.

On Tuesday, a clearly-agitated Dwight Ball told reporters again that he did not personally approve Ed Martin's severance package. (CBC)

Payout revealed

During that news conference, Ball angrily called on Martin to release the agreement.

"I hope that someone will get their hands on this and get that out there publicly, we need it out there," Ball said. "But right now there's only one person that can put it out there and that is Mr. Martin himself."

Within hours, Martin obliged and provided a public breakdown of his payout from Nalcor.

Along with his severance package, worth about $1.4 million, Martin received a lump-sum "supplemental executive retirement plan" payment of about $4.7 million.

"This type of pension plan is a standard piece of many executive arrangements, and has been provided in some cases to previous executives of (Newfoundland and Labrador) Hydro," Martin wrote.

He'll also get a public service pension plan, worth about $95,000 yearly.

Martin noted in his statement that all three payments were subject to income tax. He claimed that after taxes, he will receive about $3-million of his lump-sum payments.


David Cochrane is a senior reporter in CBC's Parliamentary bureau. He previously wrote for CBC Newfoundland and Labrador.

with files from Garrett Barry