"Council did not seek legal advice over indemnity," claims Wales Audit Office
2:02pm Friday 31st January 2014 in News
In a further twist to the ongoing dispute between Carmarthenshire county council and the Wales Audit Office, the public sector watchdog has slammed the authority’s claims that it received approval to indemnify chief executive Mark James’ legal costs in his High Court legal battle.
Mr James was at the centre of a bitter libel claim and counterclaim against Llanwrda blogger Jacqui Thompson culminating in a High Court appearance in early 2012, which ruled in Mr James’ favour.
The authority was within its rights to meet Mr James’ legal costs when he fought Mrs Thompson’s libel claim, however, the Audit Office has said, the council’s decision to use public money to fund a counterclaim against Ms Thompson was “contrary to the law”.
The council maintains that it sought legal advice – and contacted the watchdog – prior to instigating the indemnity – a claim rejected by Wales Auditor Anthony Barrett.
Responding to the Audit Office’s Public Interest report into the indemnity, the council said: “We sought legal advice from day one and remain convinced that the advice we have received, that the council has the power to grant such an indemnity in these circumstances, is correct.
“We have been completely open and consulted the Wales Audit Office at the outset, prior to granting the indemnity, and they did not advise against the action we took.”
The council further claimed that the Audit Office “changed their minds” regarding the legality of the indemnity despite informing “a member of the public” some months later that the indemnity was justified.
However, Mr Barrett offered a very different reading of those events.
Mr Barrett said: “When the council took the decision to grant an indemnity to its Chief Executive in January 2012, we advised the council to take their own legal advice on this particular issue, which they did not do. Instead, they referred to general legal advice dating back to 2008.
“In August 2012, some four months after the council had already started paying legal costs, the Appointed Auditor provided a response to a member of the public, in which he referred to the general legal advice that the council had obtained.
“The Appointed Auditor obtained his own legal advice in September 2013 and provided this in full to the Council.”
That 2013 legal advice was of the view that the indemnity was “contrary to the law”.
The council however dismissed the advice as wrong.
“Although the Wales Audit Office has expressed an ‘opinion’ that opinion does not in itself determine that the council’s actions were unlawful,” a spokesman said.
Giving her reaction, a county council spokeswoman said: "We do not understand this as we took independent legal advice which will all be presented in council when this matter is discussed."
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