$8 million windfall may solve legal puzzle

IT IS a question that has vexed many in the months since Whanganui District Council ended its legal action over the failed wastewater treatment plant.

What was the result of the out-of-court settlement between the council and MWH, the designers of the plant which was commissioned in 2007 and is now defunct?

Council sued MWH in July 2013 over what it claimed was a faulty design and, at that time, was said to be considering a claim of up to $10 million for negligence.

The two sides reached a settlement in March, with MWH admitting no fault or liability.

That settlement has been wrapped in secrecy with both sides bound by a confidentiality clause.

However, a strong clue may be gleaned from council records which show $8 million applied to debt reduction by the council in March.

That is a significant sum for the council to put against its debt and the likeliest explanation is that it is mainly made up from money paid out by MWH to end the legal stoush.

Council candidate Steve Baron certainly believes that to be so, posting details on Facebook and commenting: "The secrecy surrounding this settlement has been a bone of contention for the people of Whanganui, and the public can now come to their own conclusions based on the figures."

The council still maintains its silence, however the Chronicle understands that while the debt reduction may include other money, the major part of the $8 million comes from the MWH settlement.

At the time of the settlement, the Chronicle made a request for details under the Local Government Official Information and Meetings Act 1987.

Council chief executive Kym Fell responded: "Council has given considerable thought to this request.

"While there may be public interest in disclosing a term of the settlement agreement, [the] council has concluded that maintaining confidentiality of the settlement outweighs that public interest."