COMMENT: Kumar Sues City
Victor Kumar, former CAO for the City of Rossland, is suing the City in Small Claims Court. Can you believe the audacity? After some of the things he did while employed as the CAO and the mess he left behind that will likely take years to correct–now this!
In a Notice of Claim filed in the Rossland Court House on April 9, 2013, Mr. Kumar wants the City to reimburse him for deductions made from his artificially inflated salary which were used, in part, to pay for his Municipal Pension Plan premiums.
Mr. Kumar is claiming “the difference in the amount deducted from payroll under the Group Benefit Plan and the amount transferred to the Group Plan Carrier from January 1, 2010 to January 31, 2013.” The amount claimed is $17,555 plus filing fees of $156.
The City, in a reply to the Court by their lawyer, Murdy & McAllister of Vancouver, denies the allegations set out in Mr. Kumar’s Notice of Claim. I would hope so! (See below for the claim filed by Mr. Kumar and the City’s response.)
Mr. Kumar’s claim arises because he apparently disagrees with the interpretation of the contract which he proposed to the City when he was originally hired. His contract, in Schedule A(2) states: “The Employee participates in the Group Benefit Plan of the employee’s choice. The Employee agrees to reimburse the employer a maximum of $15,000 annually for the cost of benefits in Schedule ‘B’.
Schedule ‘B’ lists the benefits offered including clause 3 – “Superannuation”. This clause states: “The City participates in the Municipal Superannuation Pension Plan. The Employer agrees to enroll the Employee in the Superannuation Plan at the commencement of employment and contribute its share on behalf of the Employee.”
Based on the wording in Mr. Kumar’s contract, it is difficult to understand how he can claim that “The City’s contributions made on behalf of the CAO to the MPP (Municipal Pension Plan) is not recoverable from the CAO.”
This claim by Mr. Kumar simply illustrates the questionable legality of the clause contained in not only his contract but also the original contract of the City’s new CAO, Cecile Arnott, that appears to be intended to artificially inflate their pensionable earnings.
It must be noted that Ms. Arnott convinced Council to amend the wording of her contract to modify the section dealing with her compensation and payment of benefits shortly after the City received notice from the City’s auditor that I had filed a complaint with the auditor.
The similarity of the contracts of Mr. Kumar and Ms. Arnott creates an interesting predicament. Part of the Small Claims Court process involves a settlement conference in which the parties attempt to settle the claim without the need for a trial. The City must send a representative who may be accompanied by a lawyer. Normally, the City would be represented by the CAO at the settlement conference. However, given the potential impact on her own contract and having been recommended by Mr. Kumar for the job of CAO, is Ms. Arnott the appropriate person to represent the City in this case? Are any members of Council in any better position to represent the City since they agreed to the contract in dispute? So who will represent the City?
This brazen action by Mr. Kumar should give council pause to reflect on their decision not to have the contracts of Mr. Kumar and Ms. Arnott vetted by legal counsel. I suspect it won’t. The majority of council members seem to be enthralled by their outrageously overpaid management staff and are prepared to accept, without question, whatever is laid before them. The potential for embarrassing legalities seems to have escaped them.
Some might ask how I came to learn of Mr. Kumar’s claim. It was serendipity. While reviewing more of the costs related to the Columbia Avenue project, I learned from Tracey Butler, Corporate Officer, that some of the payments to the contractor for the project were still in dispute. (But that’s another article.) That reminded me that the claim filed by Maglio Installations over the construction of the Ophir Reservoir has still not been resolved. Ms. Butler confirmed that the Maglio claim had proceeded to the discovery stage of proceedings. When I researched the Ministry of Justice website looking for more information about the Maglio claim, I stumbled across the listing for Mr. Kumar’s claim. The Internet is such a wonderful resource!
I wonder if Council was going to inform taxpayers about Mr. Kumar’s exorbitant claim or if Ms. Arnott was going to include it in this year’s extremely tardy budget?
[Note: The small claims notice related to this case is attached below]
Laurie Charlton is a retired chemist who was a Rossland city councillor for 17 years between 1975 and 2011.