Smith threatens to sue IFA over €2m severance package

Former general secretary of the Irish Farmers' Association (IFA) Pat Smith is threatening to sue the association if it fails to pay his €2 million severance package.

In legal letters sent to IFA headquarters, Mr Smith also claims he was defamed by IFA suggestions he was “fired” amid the controversy over his pay. He wants the farmers’ lobby group to issue an apology and to clarify the circumstances of his departure.

In the letters, Mr Smith warns the organisation that failure to comply with the terms of his settlement agreement will result in legal action.

Mr Smith's severance package, agreed with former IFA president Eddie Downey, comprised an up-front payment of €1 million followed by €100,000 annually for 10 years, and is separate from his €2.7 million pension pot.

The IFA’s executive council last week voted unanimously to oppose paying Mr Smith any severance pay. Deputy president Tim O’Leary also signalled the IFA would mount a “robust” legal defence of its position.

Mr Smith, who had been IFA general secretary for six years, resigned last month amid protests from farmers about the extent of his remuneration, which amounted to nearly €1 million for the two years 2013 and 2014.

The IFA claims his €2 million severance deal did not have the consent of its treasurer Jer Bergin, financial controller Ken Heade, or Mr O'Leary, and therefore contravened its corporate governance rules.

The organisation last night declined to comment but confirmed it had received legal letters from Mr Smith.

Charitable donation

Last week, Mr Smith indicated he wanted half of the €2 million donated to charity. He indicated he wanted the €1 million lump sum payment given to two charities – Self Help Africa and the St Vincent de Paul – before Christmas.

A total of 10 IFA county executives are now calling for some or all of the group’s executive board to resign as a result of the pay controversy, which has led to the departure of Mr Smith and Mr Downey.

A further 13 county executives are waiting for the group's former chief economist Con Lucey to complete a review of pay and pension before determining their positions.

The IFA on Thursday began the process to elect a new president, announcing it had opened nominations. At last week’s executive council meeting, the association’s rules and privileges committee was asked to advise on the best timeframe and process for an election in light of Mr Downey’s unexpected resignation.

Under the IFA’s original rules, an election, involving members across its 900 branches, must be held within two months of the position becoming vacant.

However, the committee is recommending a rule change to give the IFA “greater flexibility on the timing of an election”.

The council is expected to pass the amendment and have the election some time in the first half of next year.