The recording of the comment has since been deleted from the council's website.
Council chief executive Geoff Williams said the editing of meeting recordings was not usual practice.
"Generally recording equipment is turned off during breaks, which is why meeting recordings are often in more than one part on council's YouTube channel.
"Staff involved in recording Wednesday's meeting noted the break had also been recorded and removed it as it was not part of the public meeting but there was no instruction from anyone to do so."
The comment has drawn criticism from the RDRR, with secretary Reynold Macpherson saying it suggested "council has a contractual relationship with CLM".
"Which, if true, would contradict the assurances given under oath to the Employment Relations Authority on 17 December by the acting chief executive, and since. And if CLM were to seek a judicial review in the High Court, who would be the respondents? Just as the councillors deserved the facts on such consequences before voting, the RDRR now demands the whole truth from the mayor and the chief executive."
In a statement Williams said suggestions a contract with CLM had already been signed and that council staff involved in an ERA hearing lied about that were "simply untrue".
"No contract has been signed and inferences to the contrary are extremely disappointing. This is merely a continuation of the misinformation, unfounded speculation and untrue allegations which have been circulated in relation to the Aquatic Centre matter," he said.
"The facts are that in November elected members made a decision to contract CLM to manage the Aquatic Centre. That decision triggered normal contracting process – council staff and CLM began contract negotiations but that process was not completed."
Following the decision to revisit proposals last week, Williams said there was now an additional process to undertake and staff would await the council's further decision, "which will determine the way forward".
In a statement Chadwick said, "Deviations from good practice can place council decisions at risk, which is why I reminded councillors that, whichever way it went, our decision on Wednesday regarding the Aquatic Centre would be open to judicial review.
"My conversation with Cr Sturt during a five-minute break following the decision, was about the potential for this to happen. There was nothing more to it than that."
Chadwick also criticised councillors who are members of the RDRR, who she claimed should have declared a conflict of interest at the meeting.
"The RDRR group is clearly on record as being directly involved in the development and promotion of the alternative in-house proposal for the Aquatic Centre management. It is concerning that there are councillors at our table who are members of and/or associated with that organisation who have not seen fit to declare an interest.
"I believe there is potential for questions about possible conflicts of interest and/or pre-determination or bias on the part of those councillors – these are the sorts of matters which leave us open to judicial review."
The two council members of the RDRR, Peter Bentley and Raj Kumar, both denied they had any conflict of interest.
Bentley said that, in his view, Chadwick was "grasping at straws". He said he was not involved in putting the proposal together in any way.
Kumar said anybody could be a member of the RDRR. The Aquatic Centre issue was not an RDRR issue, he said.
