The line of questioning of William Corlett, Her Majesty’s Attorney General of the IOM, followed on from the evidence given by Stephen Harding, the Government Advocate.

He was initially asked by Tom Owen Q.C., the Committee’s legal representative, whether he was in general agreement with the public law point principle established during the questioning of Mr Harding (on whether it is necessary to quote the exact legislative clause when issuing a direction).

Mr Corlett said he was; although it would be possible to quibble over a few issues.

Having gained that agreement, Mr Owen referred him to the meeting with the former Manx Electricity Authority CEO, Mike Proffitt, on the 30^th July 2002, and inquired if he was aware of the likelihood of litigation.

Mr Corlett said he wasn’t; although as advisor to the Council of Ministers (COMIN) he was aware of a lot of issues.

He recalled that Mr Proffitt had attended a presentation given to COMIN and that he was very lucid and very highly regarded by government at the time; particularly for the provision of the electrical system.

He was asked if he was aware of the outrage felt by former Chairman of the MEA, John McCallion and Mr Proffitt when they received the letter, in June 2002, from the then Chief Financial Officer, Mary Williams, issuing the MEA with a direction.

Mr Corlett said the first he new of it was when he received a fax from Mrs Williams.

Mr Owen put it to Mr Corlett that it was a “hot issue, a constitutional issue” that centred on the legal right of the Treasury to give directions to statutory boards: to demand information on the expenditure of public money; and he wondered if he got the impression Mr Proffitt had taken legal advice before their meeting.

Mr Corlett didn’t think this was the case but thought that Mr Proffitt had a good legal grasp of the situation.

Reminding Mr Corlett that Mr Proffitt wasn’t a lawyer he stated that a little knowledge could be dangerous; and added “and be wrong”.

Mr Corlett didn’t disagree but still said that wasn’t his impression.

Mr Owen wanted to know if Mr Proffitt had been seeking legal advice or was seeking an agreement to back-off.

Mr Corlett replied it was neither; and that he had just wanted to put him on notice of his concerns and things were going adrift.

When asked if it had occurred to him that Mr Proffitt should have gone to the Treasury Minister, Mr Corlett said no as he was coming to see the government advisor.

Mr Owen, inferring a possible conflict, suggested that if he had thought ahead he would have realised that he would also have to advise the Treasury; whilst the MEA would be getting the own (private) legal advice. He also pointed to the lack of notes taken at the meeting.

Mr Corlett didn’t deny either but said he had relayed the content of meeting to Mr Harding who had made a file note.

Mr Owen put it to Mr Corlett that he had effectively told Mr Proffitt that the direction contained in Mrs Williams’ letter from the Treasury had no effect.

Mr Corlett responded by saying that he had not given legal advice to Mr Proffitt and, being aware of the correspondence between Mrs Williams and Mr Proffitt, wanted to avoid a “disastrous legal battle” between a statutory board and government.

Mr Own thought that the public may think it is the role of a government department to protect the public’s money, that their powers are very important, and if subject to a legal challenge that they would almost certainly win.

Mr Corlett and Mr Owen ‘discussed’ the issue of referring to the exact section of the Treasury Act (section 3 (1) (f) and Mr Owen wondered if Mr Corlett thought Mr Proffitt had a valid point.

Mr Owen seemed genuinely surprised and referred to the speed limit sign analogy he had used when questioning Mr Harding.

Mr Corlett maintained that if someone is charged with the wrong offence the case is likely to fail. In his opinion, even if it was a “bad” point, or wrong, there was still the possibility that it would end up being argued in court.

So could the direction letter have been reissued, asked Mr Owen; to which Mr Corlett agreed it could.

Saying it was the crucial point, he asked if he had seen the two letters from Mr Harding, dated 29^th & 31^st July 2002, to Mrs Williams.

Mr Corlett wasn’t absolutely sure, but thought he probably did.

Mr Corlett could see, whether it was saying withdraw or back-off, it was being pugnacious.

Mr Owen inquired if, after having sent the second letter, he had issued any advice to Treasury that they could use section 3 (1) (f) or 8 to obtain the information they sought.

Mr Corlett could only recall giving advice to the Value-for-Money Committee, a short time later, which was to help clarify the position.

So you were in no doubt the Treasury could issue a direction under section 3 (1) (f) or 8 asked Mr Owen; to which Mr Corlett agreed - although he qualified it by saying he had advised that section 3 (1) (f) could only be used for ‘accounting and economies’ matters.

Returning to his meeting with Mr Proffitt, Committee Chairman, Steve Rodan SHK, put it to Mr Corlett that he had advised Mr Proffitt that the direction was flawed and inoperative, which he thought would have pleased Mr Proffitt, and proposed negotiations.

Mr Corlett agreed that Mr Proffitt would have been pleased by that.

Mr Rodan wondered if Mr Corlett had taken a view on the likely consequences.

Mr Corlett explained that the MEA board had been undermined by the direction and felt devalued; and that they may have resigned.

What about Mr Proffitt asked Mr Rodan?

Mr Corlett said he too had felt very demoralised, and saying it was difficult to put politely, that there had been a clash of personalities. The best he could say was Mr Proffitt “wasn’t happy”.

Mr Rodan put it to him there had been talk, by Mr Proffitt, of ‘constructive dismissal’ and wanting the removal of Mrs Williams; and Mr Corlett said it was all very serious.

Continuing Mr Rodan said that Mr Corlett had advised Mr Harding of the “dire consequences” and it resulted in a letter being issued stating that Mr Proffitt would start “afresh” if the direction was withdrawn.

Mr Corlett metaphorically put his hands up and said that he would have to take responsibility for that; but it was to allow the chance for negotiations.

Having agreed that the direction was withdrawn “as if it had never been written”, Mr Rodan suggested that it had gone further and been destroyed and wondered who had given that instruction.

Mr Corlett didn’t know, but made it clear he would not have issued it.

Referring again to the letter, dated 31^st July, from Mr Harding to Mrs Williams, Mr Rodan, using the well-worn term to describe the dossier in the Iraq War ‘affair’, inquired if the advice had been “sexed-up” to provide a political solution to the problem.

The A G didn’t think “sexing-up” and the Treasury Act makes easy bedfellows, and denied the second letter of advice had been ‘sexed-up’.

He disagreed with Mrs Williams evidence that there had been ‘volte face’ and suggested that, if that was what she had thought, she should have come back and sought clarification - but she didn’t, he said.

Mr Rodan put it to Mr Corlett that he was suggesting the advice in the two letters was consistent; to which Mr Corlett agreed, saying Mrs Williams should not have use the term and repeated that the second letter wasn’t ‘sexed-up’.

But it goes way beyond ‘procedurally irregular’ suggested Mr Rodan, a point accepted by Mr Corlett; but he maintained that the advice had not been conflicting.

Moving on David Callister and Clare Christian entered the fray; with Mr Callister wanting to be sure that the A G had no doubts about the legality of the financial regulations, to which he did not, whilst Mrs Christian made a very incisive observation.

Referring to Mr Corlett’s letter to the Committee she noted he had mentioned a file note, from the 31^st July 2002, which had expressed a concern of a “major financial repercussion for the Island”. Mrs Christian pointed out that he had expressed Mr Proffitt’s view to treasury but wondered if he had also taken treasury’s view and considered the financial repercussions - if the MEA were not complying with financial regulations - “as we have found out”?

Mr Corlett didn’t directly answer the question, but said he hadn’t been aware of all the correspondence and that he was surprised at the real extent of it; which he had only found out about when the submission was made to the committee.

Some of the questioning then went back over some of the issue already discussed, other than the A G stating that the Treasury Act needs re-writing, that he didn’t know if Mrs Williams had been correct when she said she, and her concerns, had been ignored; and that it was speculation to suggest legally the direction letter had been correct and that politics had overtaken legal niceties.