The Corporation of Hamilton was plunged into further chaos last night after a splinter group of five councillors and aldermen called for the resignation of Mayor Graeme Outerbridge.

Deputy Mayor Donal Smith, Alderman Carlton Simmons and Common Councillor George Scott descended on the City’s works depot yesterday and presented Corporation Secretary Ed Benevides with a letter saying they had “lost all confidence” in the Mayor.

The letter, which was signed by the three men and Alderman Gwyneth Rawlins and Common Councillor Keith Davis, said it was in the “best interests of the city, the rate payers and residents” that Mr Outerbridge step down immediately.

But Mr Outerbridge, pictured right, told The Royal Gazette he would not be resigning and vowed to complete his term.

“I am in an elected position and I will continue as Mayor until the end of my term. I have not made a decision on whether I will stand again.

“It is disappointing that this is the first reaction to me trying to highlight the need to follow the code of conduct, but it is not surprising. This has been a very tempestuous administration and problematic from the outset.”

Those calling for the Mayor’s resignation say the protest has been prompted by Mr Outerbridge’s recent dealings with the Par-la-Ville hotel development and an $18 million loan provided by Alsis Funds to developer Par-la-Ville Hotel and Residences (PLV) for the project, for which the Corporation is the guarantor.

Mr Simmons said: “The Mayor has misrepresented the Corporation and put in jeopardy a substantial amount of money and assets. He has crossed the line.”

But Mr Outerbridge rejected the claim.

He said: “I have not done anything that is outside the remit of what I have been given permission to do through resolution.

“This latest incident has nothing to do with the Par-la-Ville hotel development. It is borne out of behaviour that took place in my parlour.

“I am aware that there is some ongoing disagreement between the two parties in the Par-la-Ville development,

“But the project is still moving in the right direction and an extension is being negotiated.”

Correspondence seen by this newspaper between lawyers for Alsis, also known as Mexico Infrastructure Finance, PLV and the Corporation of Hamilton dated December 15, 2014 alleges that the $18 million loan is now in default.

It states: “This letter constitutes the written demand of the lender to guarantor to cure any and all defaults under the loan documents.

“If the default is not cured within 15 days from the date of this letter the lender intends on exercising its rights and remedies under the Loan Documents without further notice or demand.

“Such rights and remedies include, but are not limited to acceleration of indebtedness, filing suit to collect the loan, seeking appointment of a receiver, enforcing the terms of the guarantee against Corporation of Hamilton and causing foreclosure and/or sale of the property.”

Further communication, dated December 29, 2014, from PLV lawyers to Alsis refutes the allegations.

It states: “The Loan proceeds were utilised only towards paying or reimbursing such expenses and fees as permitted.

“PLV is not in default of the loan on account of the failures alleged in your said letter.”

The Corporation members’ call for the Mayor to step down came just hours after Mr Outerbridge announced the cancellation of all Corporation of Hamilton council and committee meetings until March.

Yesterday, in a second letter handed to Mr Benevides, the group questioned whether the Mayor had the authority to cancel all meetings.

A Corporation spokesman said the decision had been made after some members failed to comply with the Code of Ethics and Conduct for Members of the Corporations.