OTTAWA -- A Conservative nomination battle in Ontario is pitting two powerful political camps against one another -- and causing grumbling in the ranks about party headquarters.

Paul Smith, a 50-year-old corporate executive and former assistant to prime minister Brian Mulroney, is running against 24-year-old businessman Adam Moulton in the riding of Northumberland Peterborough South.

Both men have impressive backers. Mulroney and son Ben appeared at a fundraiser for Smith last month, and he has the support of nearby MPs Erin O'Toole and Dean Del Mastro. Moulton has received the endorsement of Employment Minister Jason Kenney, and others including New Brunswick MP John Williamson.

When the local Canadian Tire, owned by Moulton's father Ralph, began selling Conservative party memberships to help his campaign, Smith's supporters cried foul. They also accused the party of closing the sale of memberships a month earlier than originally planned, leaving Smith at a disadvantage.

Photos have been widely circulating in Ontario circles of the sign placed in the entranceway of the store advertising the sale of memberships inside, and of a Canadian Tire receipt for the $15 membership. It raised questions about whether the value of selling and advertising out of a Canadian Tire would be declared by Moulton's camp as a campaign expense.

The matter was reviewed by the party's National Candidate Selection Committee, which ultimately approved Moulton to run for the nomination. But members of the local candidate screening team in the riding didn't all agree he should be given the go-ahead.

"It has been the hallmark of the CPC 1/8Conservative Party of Canada 3/8 in my riding to stay well within the rules of E 1/8lections 3/8Canada during any nomination or writ period under the leadership and guidance of our MP Rick Norlock," riding association president David White wrote in an email.

"There are quite a number of folks here who believed that that is no longer the case."

But Conservative spokesman Cory Hann said the party had examined the matter.

"The party looked into this and after a review found no nomination rules or Elections Act rules were broken," Hann said in an email.

A senior Conservative activist familiar with the brouhaha said it all boils down to an extremely attractive riding and the high stakes that go along with it. Norlock won the riding in 2011 with a whopping 54 per cent of the vote.

"It's a very competitive race where any Conservative candidate would like those odds next fall and of course people have their elbows up," said the source, rejecting the notion any favouritism has been shown.

Other Conservatives point to leadership politics playing out in the riding -- those who support Jason Kenney as a successor to Stephen Harper versus those who like the idea of Smith as a potential key Conservative player.

Moulton, who is emphasizing his roots in the riding, declined to comment when reached by The Canadian Press. His campaign is declaring the hours worked by a Canadian Tire employee over one shift as an election expense. Two memberships sold from the store were reimbursed.

Smith, who was recently chairman of Via Rail, said he preferred not to speak about the conflict over the nomination process. Originally from Manitoba, Smith is not from the riding but recently made plans to build a home there.

"I would be honoured to represent this riding. I know I can't be a medical doctor, but I know I can be an outstanding Member of Parliament," said Smith.

"I know Ottawa like the back of my hand. It would be a privilege to be able to apply my knowledge and my experience for the good people who sent me there."

Party members in the riding will vote on Nov. 1.

The party has dealt with a number of nomination brush fires across the country as it emphasizes it is overseeing open races with no protection for incumbents or others.

Both nomination candidates in the riding of Oakville North Burlington, including MP Eve Adams, withdrew from the extremely bitter race after the party conducted investigations into their campaign activities.

MP Rob Anders lost nomination bids in two different ridings this year, meaning he will not be back in the Commons after the next election.