Corporation of Hamilton Deputy Mayor Donal Smith has come under fire from fellow councillors after going into business with a firm that has a contract with the municipality.

Mr Smith and councillor Keith Davis have set up Nevis Energy Limited (NEL) with Victor Webb, the New York businessman behind PR firm Marston Webb International, which was controversially hired by the Corporation in September to promote Hamilton overseas.

According to news reports, NEL is one of two companies involved in a multimillion dollar geothermal energy project with the Nevis government. The Nevis Island Administration confirmed it had signed up NEL on November 21.

The Corporation of Hamilton agreed to hire Marston Webb International at a special Board meeting on October 8. The Manhattan-based firm had previously worked as a consultant to the former Progressive Labour Party Government, but was dropped at the start of the year after the One Bermuda Alliance was elected into office.

According to minutes from that October 8 meeting, both Mr Smith and Mr Davis touted the attributes of Marston Webb as “internationally renowned media consultants” — but never disclosed that they had a professional relationship with Mr Webb.

At that meeting Mr Davis added that Mr Webb had been in discussions with some members of the Corporation earlier in the year, prompting Alderman Gwyneth Rawlins to question whether a contract with Marston Webb had already been agreed “by a select few” members of the Council.

Councillor Larry Scott also questioned why Marston Webb should be hired and at one point became embroiled in a heated conversation with Deputy Mayor Smith.

“There was further discussion between Alderman Smith and Councillor L. Scott and the Mayor had to bring the meeting to order again,” the minutes state.

It is not known when Mr Smith and Mr Davis went into business with Mr Webb. But yesterday both Mr Scott and Ms Rawlins criticised the Deputy Mayor and Councillor Davis for possibly misleading council colleagues, arguing that both men should have recused themselves from voting on the Marston Webb contract.

“Deputy Mayor Smith, Councillor Keith Davis and Mr Victor Webb, are all part of an energy company that has been established in Nevis,” Councillor Scott said.

“That relationship could not have just arisen, it must have been in the making for some time now, but this is the same Victor Webb who councillors Smith and Davis forced the Corporation, over the objections of some of us at the council table, to enter into a PR contract with.

“They did this without first declaring their interest and association with Mr Webb and then recusing themselves from the table when the discussion was being had.

“We knew there was a friendship because Victor Webb said so himself, but a business relation required them to acknowledge it and recuse themselves.

“I am not saying that Mr Webb’s association is bad, only that the two councilman had a duty to disclose that association. They forced Marston Webb on us and the block of five voted the rest of us down when we were simply asking for a greater explanation as to why the company should be hired. They did not give that explanation, neither did they recuse themselves knowing that they had a business relationship.”

Ms Rawlins added: It is clear to me that the Deputy Mayor and Councillor Davis have enjoyed a long relationship with Mr Victor Webb. That in and of itself is not a problem to me — we all pursue business ventures. However, once Messrs Smith and Davis endorsed a contract between the Corporation and Mr Webb for PR services, they were duty bound to declare their interest in the Nevis company, that Mr Webb is their business partner, and then absent themselves from all discussion. But they did not. Instead they pushed for the Webb contract vehemently and remained silent.

“I have no objection to whatever friendship may exist between Smith, Davis and Webb, but they were remiss in their duty not to declare their interest.”

Neither Deputy Mayor Smith or Mr Webb could be contacted for comment last night.