Law Times

Law Times • December 3, 2012 Page 7 COMMENT Tories telegraph platform of painful upheaval C hange is often painful. Of course, we all support change if it involves someone else's lot. Such is our fickle nature. When it comes to our own world, we're not as accepting. This is the challenge Conservative Leader Tim Hudak and NDP Leader Andrea Horwath face. Can they change the face of government or will it be more of the same? Horwath must convince voters she can effect change on the budgetary side without seriously affecting 3,893 collective agreements covering 844,796 workers in 79 unions whose support she depends on. And that's almost impossible. On the other side, with the legislature silent, Hudak has been pushing out a series of white papers with some platform ideas around a theme of serious change. A Conservative government, he argues, would amend everything from labour laws to pension plans and energy strategies in the name of a leaner budget. New public service employees, for example, would shift to a defined-contribution plan rather than defined benefits for their pensions. The unions will battle that tooth and nail, but the private sector started the switch long ago because unfunded pension liabilities ballooned as the workforce shrank and the number of retirees grew. the loss of competitive bidding Some of the Conservative end, it could ideas are more extreme than Queen's costs. At the low cent based on be one or two per others. Allowing employees to Park wage differences alone between opt out of a union, for example, union and non-union workers. is probably ahead of the curve. Or it could be as high as 40 per Still, promised changes to cent after considering other the Ontario Labour Relations factors such as innovation and Act are long overdue. For one, administrative processes, acthe Conservatives are calling cording to a consultant hired for independently supervised by the City of Hamilton. ballots on all issues. There That's a range of $16.6 milwould also be changes to stop Ian Harvey lion to $249.2 million in adclosed bidding on public works ditional costs in four municiprojects. It's here where reform is most urgent when it comes to restoring palities alone that represent 26 per cent of Ontario's population, the report says. financial sanity. The impact is particularly big in HamThe heart of the issue is an Ontario Labour Relations Board decision regard- ilton. Only seven per cent of otherwise ing s. 126 of the act. It defines a construc- qualified construction firms can bid on 93 tion employer and imposes a relationship per cent of the work in that city. The Tories also seized on the Toronto with unions working in the construction industry either directly or through their Star's excellent series detailing revelations trades council. Once a municipality, pub- at the Toronto District School Board last lic board or agency is defined as a con- summer of billings of $143 to install a penstruction employer, it can seek bids only cil sharpener and invoices for 76 hours for from those contractors that have signed what should have been four hours of work to install an electrical outlet in a library. agreements with specific unions. The result, according to a report by the The school board can deal with only one think-tank Cardus, leaves some $750 mil- union entity, the Maintenance, Construclion in public works contracting in four tion, and Skilled Trades Council. It drives home the point that compecities — Toronto, Kitchener, Hamilton, and Sault Ste. Marie, Ont. — unavailable to bid- tition is the only way to keep bids lean and realistic from both union-affiliated ding by non-union contractors each year. The sting is no one really knows what contractors and non-union bidders. The labour relations board's stance, which has the effect of law, is unreasonable, the report suggests, because municipalities and school boards outsource their construction needs and aren't "in the business of construction." It's a microcosm of the provincial economic malaise. More competition is exactly what we need to bring in fresh ideas and innovation. While unions have brought many protections to our society and must continue to play a role, they can't be the tail that wags the dog. As it stands today, Hudak's strategies are lost in the noise around the upcoming Liberal leadership race but they'll be front and centre when the real campaigning starts at the end of January. Hudak has telegraphed that he's ready to bring about social and legal upheaval at an intensity that might even make former premier Mike Harris blush. The big question is whether Ontario voters are ready to embrace a painful era of change for the greater and long-term good. The answer isn't a secure yes or no but is certainly a maybe. After the insanity of the Liberal government's actions in the last few years, it may well swing to a yes. LT Ian Harvey has been a journalist for 35 years writing about a diverse range of issues including legal and political affairs. His e-mail address is ianharvey@rogers.com. Magder teaches lesson about conflicts of interest T his year has had its fair share of controversial, politicized, and precedent-setting court decisions. No decision, however, has shaken the political landscape of the province as much as the recent ruling by Justice Charles Hackland of the Ontario Superior Court of Justice in Magder v. Ford that threatens to remove Toronto Mayor Rob Ford from office. Already, it's front-page news in Ontario and is apparently trending worldwide on Twitter. By the time this article goes to print, the mainstream press will have flogged the legal and even the political issues to death. It's important to try to separate the legal analysis from the politicized rhetoric on offer from both the political left and the right in the popular press. Although the case is the culmination of a long-running saga at Toronto's city hall over whether the mayor was obliged to pay back $3,150 in donations made by lobbyists and corporate donors to his favourite football charity, the decision itself is relatively straightforward and actually much narrower in focus than the popular press coverage to date would suggest. On Aug. 12, 2010, the city's integrity commissioner ruled that then-councillor Ford had inappropriately used the city logo and resources as well as his status as a councillor to raise funds for a football charity in contravention of the code of conduct. Although warned he might be in a conflict of interest, Ford spoke to council on Aug. 25, 2010, on the issue of his own alleged misconduct and then proceeded to vote on the recommendation that he be on the hook for paying back the donations. Notwithstanding his protestations and his vote against the sanction, city council adopted the integrity commissioner's recommendation and ordered Ford to refund all of the donations. office as provided for under the Let's jump to 2012. Notwithstanding the 2010 council The Dirt act. Magder had a curious role motion, Ford has steadfastly reto play in Ford's current woes. fused to refund the donations. A private citizen who's an elecOn Jan. 30, 2012, the integrity tor within the jurisdiction of commissioner issued a report the impugned politician must to city council requesting that prosecute enforcement under Ford provide evidence of reimthe act. Furthermore, the act bursement by March 6, 2012. has a ridiculously short limThe matter was up for discusitation period requiring an sion at the Feb. 7, 2012, council Jeffrey Lem application within six weeks meeting. There was a motion to after the violation comes to the elector's receive the integrity commissioner's report that Ford spoke to. There was then a knowledge. Presumably, Magder was a subsequent motion to rescind the original Torontonian and brought proceedings order requiring Ford to refund the dona- under the act in time. The court found Ford was in fact in a tions. Ford actually voted on that matter. As the dynamics of city council had now pecuniary conflict of interest even though shifted in Ford's favour, it adopted the the donations didn't go to benefit him proposal to rescind the 2010 motion and directly because the pecuniary interest directed that no further action be taken to at issue wasn't the donations per se but require him to repay any donations. It was rather the mayor's personal obligation to the 2012 council motion that was at issue reimburse the original donors. The act barred him from speaking on or voting in Magder. This point is entirely lost in almost all in the city council debate over an issue in of the popular press coverage on the case. which he had a real or potential pecuniary The case had nothing to do with Ford's interest and the prospect of having to pay wrongful solicitation of the donations $3,150 out of his own pocket constituted in the first place, all of which involved a very real pecuniary interest for Ford. The pecuniary interest test also dislargely uncontested breaches of the code of conduct. Instead, the case had every- closed an academic paradox in how the thing to do with whether or not Ford act works. Generally speaking, the act should have spoken in his own defence is intended to govern business dealings and then voted on the 2012 council mo- with the municipality. So councillors tion to let himself off the hook for the are expected to recuse themselves from discussions and voting on contracts in refund of the donations. Paul Magder, a Toronto voter, brought which they may have a real or potential an application for a determination that pecuniary interest. This makes sense and Ford had contravened the Municipal is somewhat intuitive, but the test is alConflict of Interest Act. Greatly para- ways about a pecuniary interest. As an phrased, the act requires municipal polit- unfortunate result, councillors alleged icians to recuse themselves from speaking to have violated any aspect of the code or voting on motions in which they have of conduct must recuse themselves from a real or potential pecuniary interest. As any discussion of their own misconduct part of the relief requested, Magder de- since, by definition, they'll always have manded Ford's immediate removal from a pecuniary interest in the outcome www.lawtimesnews.com of such motions because they may be docked pay for the breach. The arguably unintended result is that councillors accused of a breach of the code of conduct can never speak at council in their own defence. Hackland recognized the paradox and the lack of procedural fairness that flows from that but left that matter to potential legislative reform. The popular press is still speculating on whether Ford will run in a byelection if city council initiates one to fill the seat. This possibility seems inconsistent, however, with the ruling since it bars Ford from holding office "for the current term." John Mascarin of Aird & Berlis LLP notes that the current term is the whole of the existing four-year term of city council. As a result, the decision leaves Ford ineligible to run in any interim byelection. Finally, some pundits had expected Hackland to avoid the admittedly draconian step of ousting Ford from office by invoking the defence available under the act related to an error in judgment. Hackland considered the defence but ultimately concluded that the law couldn't countenance what amounted to wilful blindness and that Ford's actions constituted an "unfortunate but arguably technical breach . . . characterized by ignorance of the law and a lack of diligence . . . amounting to a wilful blindness of the rules." The popular press has probably already moved on to consider more scintillating legal issues such as judicial clarification, stays of execution, and appeal, but jurists still have much to debate when it comes to the Magder decision. LT Jeffrey W. Lem is a partner in the real estate group at Miller Thomson LLP. His e-mail address is jlem@millerthomson. com.

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