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Hazel McCallion’s Conflict of Interest hearing, Hazineh v. McCallion. Notes from Brampton Superior Court, April 8, 2013

April 10th, 2013  

Hazel McCallion's Thanksgiving Dinner with World Class Developments' Peter McCallion (son) and Leo Couprie

Hazel McCallion’s Thanksgiving Dinner with World Class Developments’ Peter McCallion (son) and Leo Couprie
Photo credit and special thanks to Peter McCallion, October 7, 2006.
https://picasaweb.google.com/100341223971604704180/RandomPics#4992822450712150034

Hazel McCallion's Thanksgiving Dinner with World Class Developments' Peter McCallion (son) and Leo Couprie

Hazel McCallion’s Thanksgiving Dinner with World Class Developments’ Peter McCallion (son) and Leo Couprie
Photo credit and special thanks to Peter McCallion, October 7, 2006.
(removed from Internet)

 

This is a summary of notes taken during Mayor Hazel McCallion’s conflict of interest hearing at Brampton court house on April 8, 2013. For the record, I’m not all that confident as to their accuracy (Thomas Richardson, the lawyer representing Elias Hazineh talked too fast for me to keep up at times). And I’m ashamed to admit that just before the afternoon break I actually dozed off right in the courtroom.

Next, while accredited media are permitted access to the Internet (to tweet live, for example) I have no such luxury. It would have been nice to examine minutes of meetings that I knew to be online at the Peel Regional Council website.

For readers genuinely interested in the Hazineh v McCallion Conflict of Interest hearing, I encourage you to read Toronto Star, San Grewal’s tweets at:  https://twitter.com/sangrewal1


NOTES from the Mayor Hazel McCallion Conflict of Interest hearing, Brampton courthouse, April 8, 2013

10:10 am Justice John Sproat grants me permission to take notes using my laptop.

Thomas Richardson, the lawyer representing Elias Hazineh, up with some housekeeping issues.

Freya Kristjanson, lawyer for Mayor Hazel McCallion, now up

Straight out the gate, Kristjanson raises issue regarding credibility. Asks to hear evidence from Hazineh orally —to get him on the stand. Kristjanson refers to a newspaper article Tab 1b p 11 of the record. Article dated July 10, 20(10?) by Megan O’Toole.

Kristjanson asks Justice Sproat to find that Hazineh had knowledge of the Conflict back in July 2010. So Kristjanson insists that there’s a direct contradiction between what Hazineh had stated in his sworn affidavit and what he said during cross-examination.

Kristjanson says that the legal question then becomes what can you do between a conflict between affidavit and cross-examination. Kristjanson insists that there’s a specific credibility issue re Hazineh’s knowledge and time he had it. Then refers to Hazineh as a “straw man” (implication “straw man” for Carolyn Parrish).

Thomas Richardson, the lawyer representing Elias Hazineh, now up

Richardson reminds Justice Sproat that Hazineh was cross-examined in December 2012 and that McCallion’s lawyers raised no concerns regarding time Hazineh had knowledge then or the months afterwards. That McCallion’s lawyers waited until yesterday at 3 pm to raise their contradiction concern.

Richardson then states that given the lateness (McCallion’s lawyers had four months to advise them of a problem)  “we oppose the request” (to put Hazineh on the stand today).  Richardson then suggests Kristjanson/McIntyre’s intent is to disrupt the case.

Judge Sproat then admits that he has not read all of the Hazineh cross-examination —or might have— but didn’t recognize significance of the knowledge contradiction at the time.

Richardson then dissects the July 2919 O’Toole article that Hazineh might or might not have read.

Richardson then asks that Kristjanson’s Application to call Elias Hazineh to the stand be refused or at least delayed.

Freya Kristjanson back again…

Kristjanson perfectly content to leave decisions regarding Hazineh giving testimony completely up to Judge. Justice Sproat was loathe to call Hazineh to testify cold, said Hazineh has had no preparation from his lawyer.

So the Judge won’t make a ruling on this motion as to when/if Hazineh will testify right away.  Judge Sproat said he’ll inform Richardson later today or tomorrow.

Thomas Richardson, lawyer for Elias Hazineh is now free to present his case.

Richardson now presents his case and some background.

Richardson states that Hazel McCallion, not only voted on Peel’s Development by-law, she also proposed two amendments to that by-law. This, Richardson points out, would have benefited her son, Peter McCallion.

Richardson states that at the September 6, 2007 Peel General Committee, Regional mayors/councillors considered new development charges/rates as well as grand-fathering any existing applications.

Richardson states that on September 13, 2007. Peel Council approved the September 6, 2007 General Committee recommendations and that Mayor McCallion participated in that vote. In addition to voting McCallion suggested amendments that rate increase deadlines be extended 18 months to Nov 1, 2009 “in areas of intensification” ie: Mississauga’s “urban growth centre”.

These areas of intensification and the urban growth centre included her son’s World Class Development (“WCD”) lands.

Richardson states that at the  September 27, 2007 Peel General Committee, Peel Staff recommended against grand-fathering existing application since that meant a $28m in lost revenue to the Region.

Richardson states that at the October 4, 2007 Peel Council meeting, McCallion voted to pass the Development rate increase bylaw  in a recorded vote.. The Mississauga Mayor participated in debates and voted on all by-laws and amendments. The amendments were even seconded by her. By doing so she saved her son Peter as much as $11 million dollars in rate increases.

Richardson states that McCallion knew two years before that son was involved in WCD.

Richardson states that he intends to prove, that Hazel McCallion participated in and voted on the Peel development fees by-law and related amendments in September and October 2007. Amendments, Richardson said, had the potential to save World Class Development millions. Richardson also intends to prove that Peter McCallion’s pecuniary interest was known —and that it was not a “general interest”.  Richardson insists that the Mayor’s failure to declare a conflict was not a result of error or inadvertence as the defense suggests.

Richardson states that he seeks the following relief: That Hazel McCallion has contravened the Municipal Conflict of Interest Act. That Justice Sproat declare McCallion’s seat vacant in Mississauga and Peel. And to disquality McCallion as a member of Mississauga/Peel Councils for 7 years.

Richardson then quotes President John F. Kennedy. “No responsibility of government is more fundamental than the responsibility of maintaining the highest standards of ethical behavior by those who conduct the public business. There can be no dissent from the principle that all officials must act with unwavering integrity, absolute impartiality and complete devotion to the public interest.”

Richardson points out that Ontario’s first Municipal Conflict of Interest Act (MCOI) was enacted in 1972.

[Ed. Richardson quotes from several cases and I can’t keep up. This portion of my notes has a big hole in it.]

Richardson then reminds the court that “No man can serve two masters” –that even well-meaning people can become impaired when personal interests are in play. He coaches that the Municipal Conflict of Interest Act must be construed broadly. Richardson also reminds us that the Municipal Conflict of Interest Act was in force the entire time that Hazel McCallion was Mayor of Mississauga and before that, when she was Mayor of Streetsville!

Richardson now refers now to Hazel McCallion’s 1982 Conflict of Interest case.

Richardson then details the MCOI Act: that the MCOI imposes a duty on Council. That where a Member, either on his own or someone else’s behalf, has any pecuniary interest direct/indirect, that Member has three obligations. 1. Disclose the interest 2. Shall not take part in discussion or any vote. 3. Shall not attempt in any way to influence voting.

Richardson tells the court that pecuniary interest is not defined in the Act. But that pecuniary interest is not to be narrowly defined. Richardson states that pecuniary interest is not just clear and very significant interest –but ALL.

Richardson states that “indirect pecuniary interest” is defined in Act. He says that there will be some evidence with respect to Peter McCallion’s involvement as “indirect pecuniary interest” of the Mayor because her son, Peter had DIRECT pecuniary interest in World Class Developments.

Section 3 of Act says “For the purposes of this Act, the pecuniary interest, direct or indirect, of a parent or the spouse or any child of the member shall, if known to the member, be deemed to be also the pecuniary interest of the member.”  So Peter McCallion’s pecuniary interest in WCD is also a pecuniary interest of the Mayor.

Richardson states that a key consideration of this court is what knowledge the Mayor had back in Sept/Oct 2007 of her son’s involvement in WCD. Items voted on must have the potential of affecting the pecuniary interest of the Member –but it’s also important to gauge how this pecuniary interest is perceived by the public.

Richardson states that the test is an objective one —that it doesn’t matter how a member votes, the Act demands that public duty not conflict with economic self-interest.

Richardson points out that the Act has exceptions and may be raised as a defense. 4(j) –”by reason of the member having a pecuniary interest which is an interest in common with electors generally”.

Defined in Section 1 of the Act “’interest in common with electors generally’ means a pecuniary interest in common with the electors within the area of jurisdiction”.

Richardson says that the votes in question relate to the Region of Peel development by-law and that this by-law applies across Peel. But doesn’t apply to voters at large but only to those who had applications subject to development charges —if the developer was able to bring in transition period.

So, Richardson concludes, those benefiting from the Peel Development by-law grand-fathering was a select group. Only those able to build in the time constraints of provisions.

Richardson states that the word “generally” in the MCOI Act means that ratepayers might benefit from the Peel Development By-Law in some way, but in fact, that doesn’t preclude a smaller group from benefiting much more. So the concept of “community of interest” deals with kind but not degree of interest.

McCallion’s lawyers will claim the Mayor to be exempt and have two bases for this claim. 1. There was no potential for World Class Developments to benefit. 2. That Peter McCallion was limited to real estate agent.

Richardson insists that the fundamental question is, would a reasonable electorate given knowledge of “apprised of all the circumstances” conclude there was a financial benefit depending on how the Member disposes of the subject matter? (Cited this test from a case.)

This is an objective test –must be reasonably viewed as having influenced the member. Richardson then refers to the Lorello case. [Ed. And I fall behind in my notes]

Richardson states that at time of the vote, there was a possibility that Peter McCallion and World Class Developments would have benefited.

Judge Sproat then asks for details relating to the concept of “remoteness”. Richardson cited a case where it was argued that a particular interest was “highly speculative and theoretical” but the court rejected this argument. It ruled that Conflict of Interest “Prohibition applies at every step.”

Richardson explained that remoteness relates to the potential for financial interest and not to whether the matter proceeds or not. The bottom-line question is: “Is there a financial interest?”, not: “Is the matter (project) likely to proceed?”

Richardson refers to a case where a councillor voted on a top soil removal application where he was actually the real estate agent for the land. The money could be considered insignificant but the public perception of a land deal must also be considered.

Even where a project is the “early step in a long process”.

[Ed. I missed what came next. Richardson citing lots of cases and quickly]

Richardson points out that the enforcement of the Municipal Conflict of Interest Act is left to the Judge of a Superior Court. There is no public agency to enforce the Act. Or public funds. Laying charges under the Act is left exclusively to the electorate.

Richardson now tells Judge what the Act says is his duty and reminds all that the Municipal Conflict of Interest Act does not distinguish long-serving or popular officials.

Court recess.

Judge Sproat enters at 11:55.

Judge Sproat revisits McCallion’s lawyers’ protests that there must have been some communication between Parrish and Hazineh. So the Judge asked whether anyone had asked Parrish if she communicated her knowledge to Hazineh. Judge then points out that some of the same arguments that apply to Hazineh also apply to Parrish.

Richardson still on.

Richardson repeats what he said before recess —that the Act does not distinguish between long-serving/popular members. And added that a judge can’t consider the effect his decision might have on municipality either.

Turning to his factum, Richardson says that the Act is “crystal-clear” and “harsh” since it deals with citizens’ “highest trust” The Act demands that elected officials are not just “unshirkingly-honest” but “be seen to be so”.

The Municipal Conflict of Interest Act provides two savings provisions. If the Act is found to be contravened, the Judge can find inadvertence or error in judgement.

Richardson points out that inadvertence or error in judgement “is not a defense”. They only apply when a member has been found to contravene the Act. And only apply to penalties.

Richardson now refers to his Apply Factum.

Richardson explains that inadvertence refers to a failure to direct one’s mind to his duty.

He goes on to say that willful blindness cannot be applied as inadvertence. McCallion claims her actions were “honest belief” of general applications.

[Ed. Again…going too fast…. missed Richardson’s point]

Richardson reminds the court that every action can be claimed to be an error in judgement. Even criminal acts are errors in judgement.

Case law says this about errors in judgement: Acting in good faith that results in errors of judgement still requires “honesty, candour and complete good faith”. Members aren’t expected to be perfect.

Richardson says that there is a difference between honest belief and good faith —there must be some diligence to understand one’s obligation. Ford had an honest belief. However that judge stated an error in judgement must have occurred honestly and in good faith. Good faith ….means diligence to understand.

Ignorance of the law, willful blindness —both are incompatible with the error in judgement safety provision.

Richardson states that acting recklessly or being willfully blind can’t be error in judgement under the Municipal Conflict of Interest Act. The member should demonstrate some kind of concern for conflict of interest –like getting or relying on a legal opinion.

Flawed understanding is not an excuse in Ford case. While Mayor Ford may have honestly believed –Richardson states that it would undermine the Municipal Conflict of Interest Act to rely on error of law. Good faith demands that Mayor Ford pursue clarification and not rely on his subjective interpretation.

Richardson says that a member must not just claim honest belief but must also show he/she took some reasonable steps –diligence— with respect to his duties under the Municipal Conflict of Interest Act.

In cross-examination, Mayor McCallion explained that she believed that the Peel Development by-law was general application. McCallion said “it affects all taxpayers”. Yet the Mayor gave no evidence that she obtained a legal opinion on this.

Richardson said that (Applicant) Elias Hazineh is a taxpayer/resident in Mississauga. That Hazineh is heavily involved in advocacy and passionate about Canadian politics. He’s an immigration consultant as well. Over the last few years Hazineh has developed interest in McCallion’s conflict of interest issues. For example, he supported Judicial Inquiry.

Hazineh personally attended two Inquiry proceedings and watched others on TV.

Hazineh attended October 3, 2010 Cunningham report. Was present at the press conference as well. Richardson said that Hazineh has since reviewed press conference on YouTube. Now quoting what she said.

Hazineh then read an article (October 11, 2011) in Mississauga News by Clay Connor “McCallion may not be out of the woods”. From that article he learned McCallion may have been in breach at Peel October 4, 2007. Hazineh also determined that any Peel conduct/vote was outside the Judicial Inquiry’s Terms of Reference.

Hazineh learned about the grandfathering of development charges. Learned that World Class Developments would save $9M approximately. Learned Mayor McCallion did not declare a conflict at Peel meetings and also voted on the issues. Prior to that he was not aware of the voting.

Then Hazineh shared his concerns with Carolyn Parrish and contacted her. Parrish confirmed to Hazineh the that  Inquiry did not deal with Peel and the voting there.

Richardson then reviewed the legal requirements for standing. Must be an elector. Canadian citizen. At least 18. Reside in municipality. Allowed to vote under law.

NEXT SECTION –ON LIMITATIONS

Richardson stated that evidence of Hazineh’s knowledge was not challenged or rebutted by the Mayor’s legal team. An elector can apply to a judge within 6 weeks to when a suspected conflict of interest comes to his knowledge.

Richardson’s position is that Hazineh is in compliance under the Municipal Conflict of Interest Act.

By contrast, the position of Mayor McCallion’s lawyer is that Hazineh ought to have known well before the application date –especially considering his relationship with Parrish.

The Municipal Conflict of Interest Act says, “No application shall be brought under subsection (1) after the expiration of six years from the time at which the contravention is alleged to have occurred”. Richardson submits that 2013 is within six years of events in 2007.

Richardson states that six years used because member of the public needs time to “get it” –a ratepayer in the first instance may have little knowledge in pecuniary interest in a member.

Richardson is still on the Reply Factum.

Richardson continues. The elector must have knowledge that the elected official was present at a meeting and that the member failed to disclose a conflict, took part in related discussion/vote. Or before/after any meeting, the member attempted to affect voting.

Richardson suggests that the savings World Class Developments could have enjoyed from the transitional provisions of the Peel Development by-law was more like $11M than $9M.

Richardson says Hazineh really didn’t “get it” til October 2011 reading the Connor article.

McCalllion’s lawyers defend that Hazineh should have known prior because of the knowledge of Parrish. Richardson states that there’s no evidence that is so.

Richardson states that the Municipal Conflict of Interest Act does not impose citizens the duty to monitor a municipal council.

The Act’s Sec 9 sub1 states, “Subject to subsection (3), an elector may, within six weeks after the fact comes to his or her knowledge that a member may have contravened subsection 5 (1), (2) or (3), apply to the judge for a determination of the question of whether the member has contravened subsection 5 (1), (2) or (3). R.S.O. 1990, c. M.50, s. 9 (1).”

Richardson now ends the issue of limitations relating to the Act.

Judge Sproat now ponders whether additional witnesses need to testify. Says he wants to deal with that issue ASAP

Break til 2:15 PM

Court starts precisely at 2:15 pm

Richardson addresses Development Charges Act and states that prior to the Act, Mississauga had a system of levies stating that development had to pay for itself. Richardson suggests that Mississauga was even belligerent about “Growth must pay for itself“.

Now reading Act stating “The council of a municipality may by by-law impose development charges against land to pay for increased capital costs required because of increased needs for services arising from development of the area to which the by-law applies.” Richardson emphasizes the word “increased”.

[Ed. I can’t follow his argument re application/restrictions of the Act. Getting highly specific here]

Richardson stated that people “developing” their house (adding on) do not pay development charges.

The Development Charges Act says a by-law can allow for transition periods. Transition periods are intended to allow developments in process to continue to pay original charges.

Richardson then examines the specific of the Peel Development by-laTRATRw that McCallion voted on. Still working from his factum. Richardson states that both Mississauga and Peel impose development charges. But they are distinct from each other.

Richardson tells the court that development charges are linked to development –growth, not repair. So growth must pay for itself (to keep pace with infrastructure).

Richardson points out that in 2007 Hazel McCallion voted against grandfathering . In 2007 she voted for transition period stating, “It will have a negative impact for development in Mississauga.”

Regarding the Peel Development by-law, McCallion also said “It will add $7,000 to the cost of a condo unit”. Richardson points out that McCallion said that she can’t remember making that statement.

Richardson argues that the development charges are not general application but discrete –applying only to those applications on or before June 1, 2007 and issued on or before September 13, 2007 –applies where an application is sufficient by certain date. (Meaning the bylaw’s impact really starts to narrow it down).

Richardson states that development charges for a hotel would be 83.1% and condo units would be 88.9%.

Richardson states that around this time staff and politicians were keeping an eye on how they stacked up to other GTA municipalities.

Richardson maintains that the Development by-law applied to “a discrete group of possible beneficiaries”.

Now onto transition period.

Richardson says that Development Charges Act is silent on transition periods. Municipalities try to be fair and equitable. But clearly there was a change of thinking happening in presentations to Mayor/Councillors.

Then Richardson deals with Mayor’s involvement in the process. He introduces a letter from McCallion’s office regarding an arterial road saying this shows that the Mayor knows what’s what, is interested in what’s what —and is not thinking regionally but rather for Mississauga only.

Regarding the report on transitioning. Staff were also asked to ponder a phase-in (different from transitioning). It turned out that delaying implementation of Development fees for 1 year could results in a revenue loss of $80M.

Richardson made it clear that the issue is not whether the Peel by-law is one of general application but whether the pecuniary interest of Mayor/son is one with the general public. Meaning, is Peter McCallion’s pecuniary interest (and the Mayor’s)  in common with the electorate generally.

“Transition costs the taxpayers money” said Hazel McCallion under cross-examination.  “Costing money” is not the pecuniary interest of Peter/Hazel. His interest is paying as little as possible. “one of general issue” misses the point.

After recess  3:55 pm and beyond…

Richardson still up.

Richardson says that the September 6, 2007 Peel General Committee meeting is critical with respect to approval of Peel’s Development by-law.

[Ed. Something about acknowledged good relationship between Peel Staff and development industry. Couldn’t write what Richardson said fast enough]

Richardson says that McCallion moved a 90-day transition for non-residential. So the amendment extended to May 1, 2008.

In cross-examination, Mayor Morrison swore that she shared her concern that there were projects that would not proceed in Caledon if there weren’t a transition period.

[Ed. Then I couldn’t follow what Richardson said for about 10 minutes! Getting tired…]

Richardson then outlines a chronology of events.

Onto the September 13, 2007 meeting. At this meeting another staff report was received. 2007 Development Charges by-law. See Final Technical Adjustments re Developmental Charges by-law. Included amended adjustments and rates.

Fennell requested item in Sept 6th General Committee meeting’s minutes be reconsidered. Amended that 2007 residential and non-residential be adopted subject to the transition provision (the extended one). [Ed. He’s reading the amendment –can’t follow.]

That resolution took the recommendation from General Committee, move the recommendation with some amendments and also carries over the amendment by McCallion.

Richardson said that at same meeting, after Council approved, entries states, Fennell puts forward to reconsider resolution, carried by 2/3 majority vote.

Fennell moved and McCallion seconded –amended to include transition period for high density be extended to November 1, 2009! (Reminder, before this the transition period was May 1, 2008!) And that Staff devise plan for implementation.

Moved by Fennell/seconded McCallion Sept 6 resolution is amended Passed something  and then amended it and then?…  [Ed. Again, so convoluted I can’t follow Richardson’s arguments here.]

Richardson now summarizes. Peel Council approved Council minutes with previously proposed amendment. Then Fennell reopens previous meeting minutes. Then Fennell moves amendment to something already approved. Then extends transition from 3 months to 18 months. And eventually move that the minutes of the previous Sept meeting be approved!

Richardson points out that the two amendments dealt with that Council meeting were either moved or seconded by Hazel McCallion.

Richardson has come to a break in his submission.

Judge will be here tomorrow at 8 am.

COURT NOTES FOR APRIL 8, 2013 END

Last, I’d appreciate being advised of any errors.

Hazel McCallion's Thanksgiving Dinner with World Class Developments' Peter McCallion (son) and Leo Couprie

Hazel McCallion’s Thanksgiving Dinner with World Class Developments’ Peter McCallion (son) and Leo Couprie
Photo credit and special thanks to Peter McCallion, October 7, 2006.
https://picasaweb.google.com/100341223971604704180/RandomPics#4992822464988250130

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