Category: Criminal

CLICK HERE, for Mike Duffy.

CLICK HERE, for Patrick Brazeau and Mac Harb.

CLICK HERE, for Pamela Wallin.

“Conservative” Senator Mike Duffy, who claims to be from Prince Edward Island (P.E.I.), has been acquitted in an Ontario Criminal Court of all 31 counts of: fraud, bribery, and breach of trust.

(1) Mike Duffy lives in Ottawa, ON, but claimed expenses under the excuse that his primary home was actually in P.E.I. Had he admitted being an Ontario resident, the expenses would have been disallowed.
(2) Mike Duffy accepted a $90,000 payoff from Nigel Wright, the then-government’s chief of staff to reimburse illegal expenses.
(3) Mike Duffy had made other false expense claims since becoming a senator.

CLICK HERE, for the actual court ruling acquitting Duffy.

However, the ruling itself makes little sense, so let’s dissect it. Quotes are in bold/italics, and commentary in normal font.

PRESUMPTION OF INNOCENCE
[3] I would like to relate an interesting encounter that I experienced near the commencement of this trial that demonstrates the difference between the legal presumption of innocence and the application of that presumption by many citizens.
[4] I was returning to the courthouse after a lunch break when I heard a man who was soliciting funds from passersby say, “Sir, sir.” I stopped and began to check out my monetary situation. However, the stranger did not ask me for a financial contribution. Instead, he asked me if I was connected with the Duffy trial. I advised him that I was. He then inquired whether I was counsel. I advised him that I was not but I did tell him that I was the judge hearing the case. Without missing a beat, my new found friend enthusiastically stated, “Throw him in jail.”

[5] The aforementioned exchange highlights two important aspects of Senator Duffy’s trial.

[6] Firstly, the scenario illustrates the public awareness and interest in these proceedings.

[7] Secondly and more importantly, the exchange draws attention to the overarching touchstone principle of criminal law in Canada, namely, that everyone is presumed innocent until the Crown proves them guilty beyond a reasonable doubt. Although, the stranger drew my attention to the principle, his enthusiastic response highlighted a contrary position to the presumption of innocence. I think it is fair to say that many people may share the belief that once someone is charged with a criminal offence they are guilty. This is not the law of the land.

Proceedings in criminal and penal matters
11. Any person charged with an offence has the right

…..(d) to be presumed innocent until proven guilty according to law in a fair and public hearing by an independent and impartial tribunal;

This is an amusing encounter, but not sure why it needs to be brought up. It is expected that all criminal defendants are presumed innocent. In fact, the Trial Judge would harp on at length about presumption of innocence.

APPROACHES TAKEN BY COUNSEL
[12] The Crown and the Defence have taken very different views in the presentation of their respective cases. The Crown’s mantra is common sense, common sense, common sense. Meanwhile, Mr. Bayne’s repeated battle cry is rules, rules, rules or alternatively, what rules? These competing views of the world will become apparent as each section of cases is examined.

This actually is very true. The defence did go on at great length about how certain “procedures”, such as misappropriating funds, were not actually spelled out in the Senate’s rules. While correct, the Crown makes the valid point the “Sober Second Thought” of the Legislature shouldn’t need it pointed out.

[15] The cross-examination of Senator Duffy did cause me to pause. I agree with Mr. Bayne that the majority of the charges were not addressed in cross-examination. Of particular note, there was no cross-examination of Senator Duffy on the key charges involving Nigel Wright. The end result of the lack of cross-examination is that much of Senator Duffy’s testimony is left unchallenged.

[16] I am aware that there is no rule that requires cross-examination of any witness. The decision to cross-examine a witness or conduct a limited and focused cross-examination or to not cross-examine a witness at all is within the complete discretion of counsel and there may be any number of strategic reasons why one option is chosen over another.

[17] Defence Counsel conceded that Senator Duffy presented himself as an emotional and passionate witness at times but asked the court to understand that this was Senator Duffy’s first and only chance to put his position forward after years of wanting to do so.

The Judge’s comments seem rather odd. It gives me him pause that there were many charges which there wasn’t cross examination of, yet concedes that Prosecutors often have valid reasons for doing so. Also, I would wonder how exactly to cross examine someone who admits much of the facts, but plays dumb.

The claim that this was Duffy’s first and only chance to put a position forward is flat out untrue. There were many, MANY media inquiries made looking for more information. Duffy chose not to respond. Further, certainly if his lawyer had proposed a sit down with the Crown, it would have been immediately agreed to.

[32] The next area that caused Mr. Holmes concern focussed on Senator Duffy’s tendency to exaggerate. As an example of this tendency, I was pointed to Senator Duffy’s depiction of Prince Edward Island’s virtues and attributes in terms that “there’s nowhere else you want to be” but I was then reminded that in fact Senator Duffy’s career path took him away from P.E.I.

[33] I attach no significance to this whatsoever. The fact that Senator Duffy pursued employment opportunities away from P.E.I. is a fact of life. Although, he may have physically left P.E.I. to work, Senator Duffy continued to maintain many contacts with his place of birth and he had already secured his retirement home in P.E.I. well in advance of his appointment to the Senate. As to the effusive nature of his praise for P.E.I., I agree that it did seem like a promotional advertisement for the Province. However, I do not find this to impact negatively on the issue of credibility.

These statements are total red herrings. Mike Duffy moved from P.E.I. to Ontario decades ago. The reasons are irrelevant. Having a vacation home (or retirement home) in P.E.I. is not the same thing as residing in P.E.I. The issue was that it was not his place of residence. It had nothing to do with promoting the Province, but everything to with getting travel and housing allowances under false pretences.

[49] Mr. Holmes pointed out that Senator Duffy’s evidence was internally inconsistent. He stressed that the juxtaposition between Senator Duffy’s testimony that he merely skimmed the rules and his embracement of a very detailed and technical knowledge of the rules to afford him a defence to one of the charges should cause the court concern.

[50] Mr. Neubauer provided another example of a juxtaposition of two at-oddspropositions. He pointed out that Senator Duffy took the position that the rules surrounding the NCR expenses were vague but also maintained that he was eligible under the rules.

[51] When considering both of the preceding examples of internal inconsistency, one must be mindful that when the events were unfolding, Senator Duffy might have skimmed over certain written materials and considered that the rules were vague. However, once he was charged with the offences he is currently facing, he, perhaps with the assistance of his legal counsel, viewed the situation in a more defensive light. The credibility alarm is not triggered by the circumstances referred to by Crown Counsel.

I would argue this is another red herring. Whether Duffy “skimmed the rules” is irrelevant. We are taught in grade school that stealing and lying are wrong. Lying in order to justify theft (a.k.a. “Fraud”) is illegal and wrong. Remember, the Senate is the “Sober Second Thought” which reviews and debates legislation passed by the House of Commons. Do we really need to specify don’t steal?

Further, Duffy has had various employers over the years. Certainly he knows that expenses can be reimbursed if they are reasonable and work related.

Duffy’s “Primary” Place of Residence
[54] Mr. Neubauer highlighted the discrepancies between an email Senator Duffy forwarded to Senator Tkachuk dated February 7, 2013 and other evidence in the trial. The text of the email is as follows:

David:

After speaking to my lawyer, I now understand that the issue in question is not whether I own property in P.E.I.; but rather whether my principal residence is there, thus entitling me to expenses for my home in Kanata.

If this is indeed the issue, then this is the first time a concern has been raised with me by anyone. I have been claiming these expenses routinely, as I was told I could do at the time of my swearing-in in 2009.
However, if there is anything improper about these expense claims, I want to correct it. I have no interest in claiming expenses to which I am not entitled.

Can we discuss this matter before you issue any media release naming me, as I believe we can resolve this expense issue without the need of an audit.

Sincerely,
Mike

[55] Mr. Neubauer pointed out that this email contradicts Senator Duffy’s other evidence at trial, namely, that this is the first time a concern has been raised with him by anyone with respect to the housing claims. Mr. Neubauer then referenced discussions between Senator Duffy and Senator Tkachuk back in January of 2009 that dealt with housing claims.

[56] In fairness to Senator Duffy, it was he who raised concerns about his housing entitlements back in 2009 and it was his understanding from the discussions with Senator Tkachuk that he could and should claim for living expenses.

[57] I find that during the January 2009 discussions with Senator Tkachuk, Senator Duffy was not attempting to deceive him.

It sounds like the Judge is trying to make excuses for Duffy. By his own admission, the issue was raised in 2009, so there is no way Duffy didn’t know about questions surrounding primary residence. And again, use common sense. A Senator should not need it spelled out that theft and fraud are wrong.

[67] I acknowledge that Senator Duffy has some areas that require the court to be vigilant about when weighing his evidence. In addition to the specific issues regarding Senator Duffy’s credibility, I must remind myself that he loved the run-on answer providing an inordinate amount of information, much of which was rather peripheral to the questions posed. He also admitted that his memory was not perfect. The truth of the matter is that this characteristic applies to everyone. He had several private agenda matters that he felt compelled to work into his testimony.

[68] This case provided me with ample opportunity to assess the credibility of Senator Duffy. He was on the stand for many hours.

[69] At the end of the day, I find that Senator Duffy is an overall credible witness. As I address the various charges contained in the information, I shall keep in mind any concerns that I have noted herein regarding Senator Duffy’s credibility and apply them to the particular fact situations.

Okay, 2 serious problems here. The Trial Judge admits:
(a) Duffy loves run on sentences, most of the information irrelevant; and
(b) Duffy says he has memory problems

These should be red flags, yet the Judge shrugs them off.

[75] It should be noted that this trial is not about whether Senator Duffy was/is legally qualified to be a Senator from P.E.I. This trial is focussed on whether or not the Crown has proven the criminal allegations against Senator Duffy that are contained in the information beyond a reasonable doubt.

Actually, one of the major issues here was that Duffy, an Ontario resident, was making expense reimbursement claims under the pretense that as a P.E.I. resident. To say his legal qualification is not an issue is completely wrong.

[77] It is alleged that the accused (1) between the 22nd day of December, 2008 and the 6th day of March, 2013 at the City of Ottawa, in the East Region, being an official in the Senate of Canada , did commit a breach of trust in connection with the duties of his office by filing expense claims and/or residency declarations containing false or misleading information, contrary to section 122 of the Criminal Code of Canada and further (2) that he between the 22nd day of December, 2008, and the 6th day of March, 2013, at the City of Ottawa, in the East Region, did by deceit, falsehood or fraudulent means defraud the Senate of Canada of money, exceeding $5000.00, by filing expense claims and/or residency declarations containing false or misleading information, contrary to section 380(1)(a) of the Criminal Code of Canada.

Fraud
380 (1) Every one who, by deceit, falsehood or other fraudulent means, whether or not it is a false pretence within the meaning of this Act, defrauds the public or any person, whether ascertained or not, of any property, money or valuable security or any service,
(a) is guilty of an indictable offence and liable to a term of imprisonment not exceeding fourteen years, where the subject-matter of the offence is a testamentary instrument or the value of the subject-matter of the offence exceeds five thousand dollars

The Trial Judge is correct that these are among the allegations Prosecutors are making. So yes, whether Duffy actually is a P.E.I. resident is very relevant to the proceedings.

[82] The Crown theory in respect of these offences is based on the fact that Senator Duffy, a long-standing, habitual resident of Ottawa, was primarily resident in Ottawa in the period following his appointment to the Senate. He had resided in Ottawa since the 1970s. His connection with the Province of Ontario was revealed, not only by his whereabouts, but also by his driver’s licence, passport, provincial health coverage and income tax filings that all portray him as a resident of Ontario. Mr. Holmes is of the opinion that Senator Duffy’s designation of “10 Friendly Lane” in Cavendish as his “primary residence” is inaccurate, but benign. The completion of the annual Residency Declaration forms occasioned no payments and thus, standing alone, likely does not represent a criminal fraud.

It is stated bluntly that Duffy has lived in Ontario since the 1970s. His “documentation” includes: 1/ driver’s license; 2/ passport; 3/ provincial health coverage; and 4/ income tax filings all say he resides in Ontario. Declaring his home as “10 Friendly Lane in Cavendish, P.E.I.” is not inaccurate, but benign. Rather, it is a deliberate attempt to get access to unauthorised funds.

Again, it seems like the reasoning is deliberately skewed to suggest that Senator Duffy is clueless and harmless. He is a sitting Senator!

While this ruling will prattle on for much longer on the topic, the fact remains: Duffy claimed to still be a P.E.I. resident for the deductions. The Trial Judge shrugs it off as harmless error

[119] The entire exchange is captured in Senator Duffy’s testimony from 16 December 2015, at pp. 74 to 79. Senator Duffy answered in the affirmative when Senator Tkachuk asked if Senator Duffy owned a house in P.E.I., paid for hydro, paid for gas, insurance and (property) taxes there. But the Crown urges that the information supplied by Senator Duffy was misleading, at the very least:
 -The property at 10 Friendly Lane was not a house, it was a cottage
 -The hydro was shut off
 -The last shipment of propane was delivered in the fall when the cottage was closed up
 -Senator Duffy paid property taxes in P.E.I. as a non-resident.

[120] I do not take Senator Duffy’s responses as misleading. It is impossible to assess accurately a conversation when one of the parties is not called to give evidence.

Evidence which completely refutes the defense is shrugged off.

Claims That “Rules Are Vague” For Travel
[285] Mr. Bayne submits that if the policy governing valid recourse to Senate financial resources to fund Senators’ travel is itself inadequate, and is poorly communicated to and not well understood by Senators, that is the responsibility of the Internal Economy Committee and Senate Administration. Individual Senators do not make or communicate policy. The policy governing Senate-financed travel lacked “clear guidelines and criteria” for what was and wasn’t a properly expensed parliamentary function and/or partisan activity. Senator Duffy did not have criminal or corrupt mens rea in completing the travel he undertook and related expense claims, believing reasonably that the travel fell within the parameters of the SARs provisions that existed.

One really has to wonder just how many Senators are actually making fraudulent expense claims. This “don’t ask, don’t tell” seems to be so widespread and accepted. Are they all on the take?

Pre-signing of Some Expense Claims Not Proof of Crime

[287] Mr. Bayne stated that having failed otherwise in respect of counts 3-20 to prove beyond a reasonable doubt the actus reus and/ or mens rea for fraud and breach of trust, the Crown will/may assert that the pre-signing of travel expense claims forms by Senator Duffy makes out the offences.

We just sign the checks and let the Senators put in their own amounts later?

Payments to Gerald Donohue
PAYMENTS MADE TO AND THROUGH MAPLE RIDGE MEDIA AND OTTAWA ICF AND GERALD DONOHUE TO VARIOUS INDIVIDUALS AND ENTITIES [572] It is alleged that the accused (21) between the 23rd day of February, 2009, and the 5th day of April , 2012, at the City of Ottawa, 2012, at the City of Ottawa, in the East Region, being an official in the Senate of Canada, did commit a breach of trust in connection with the duties of the office by amending consulting contracts in favour of Gerald Donohue, contrary to section 122 of the Criminal Code of Canada and further that he (22) between the 23rd day of February, 2009, and the 5th day of April, 2012, at the City of Ottawa, in the East Region, did by deceit, falsehood or fraudulent means defraud the Senate of Canada of money, exceeding $5,000.00, by awarding consulting contracts in favour of Gerald Donohue, contrary to section 380(1)(a) of the Criminal Code of Canada

In short, these were the “payment to a buddy for no work” alleged by Prosecutors.

[590] I cannot help but note that the overall plan developed by Senator Duffy and Gerald Donohue to disperse the Senate funds provided has a number of shortcomings that cause me to conclude that such a financial arrangement should not be considered as a wise option moving forward.

[591] Firstly, Mr. Donohue may have been the operating mind of the companies in question but he had no legal connection with either company. There is no evidence suggesting that Senator Duffy was aware of this shortcoming.

[592] Secondly, the nature of the setup is such that it is open to the suggestion as put forward by Mr. Holmes that this arrangement amounts to a slush fund. Although, I do not agree with Mr. Holmes’ assessment, there is a negative perception created.

[593] Thirdly, Senator Duffy did not retain any direct control over the funds once they were put into the hands of Mr. Donohue’s corporate entity.

[594] Fourthly, Senate Finance did not have any idea as to the precise use made of the funds.

The Judge does not see any criminal wrongdoing here, just a bad business deal.

Standard For Breach Of Trust

CLICK HERE, for the case of R v. Boulanger, 2006, the leading authority on breach of trust by public officials.
Jurisprudence: Breach of Trust

[760] The unanimous decision in 2006 of the Supreme Court of Canada in R. v. Boulanger, [2006] S.C.J. No. 32, is the leading Canadian jurisprudence on the required constituent elements of the offence of breach of trust by a public officer, s. 122 of the Criminal Code. The subsequent Ontario decisions of R. v. Radwanski, [2009] O.J. No. 617, and R. v. Lavigne, [2011] O.J. No. 1193 represent relevant applications of Boulanger and consideration of related fraud charges.

[761] In Boulanger, the Supreme Court reversed a breach of trust conviction and entered an acquittal. The appeal required the Supreme Court, in the words of McLachlin, C.J., “to clarify those elements” of the crime of breach of trust. (supra, at paras 1; 4; 7)

[762] Boulanger was a municipal official (director of public security of Varennes, Quebec) whose daughter was involved in a motor vehicle accident. He directed the investigating officer to prepare a second, “more complete” accident report which led to the conclusion that his daughter was not at fault and meaning that Boulanger did not have to pay the insurance deductible. (Ibid, at para. 2)

[763] The Supreme Court analyzed the common law roots of the s. 122 offence, noting that “error in judgment” did not make out the offence and that proof of “corruption” was required, not mere “mistake or error”. (Ibid, at paras 11-18) As well, the common law required that “the misconduct at issue be serious misconduct: there must be a serious departure from proper standards… A mistake, even a serious one, will not suffice.” (Ibid, at para. 28) The Supreme Court rejected the concept of “nonfeasance” (“neglect of official duty” as sufficient to constitute the offence, requiring proof of “misfeasance” requiring “dishonesty, corruption or oppression.” (Ibid, at paras. 30-41)

[764] The Supreme Court endorsed the 1992 decision of the Quebec Court of Appeal in Perreault which “stressed the need for a meaningful distinction between administrative fault and criminal behaviour.” (Ibid, at para. 43)

[765] The Supreme Court defined its task in Boulanger: “We are faced with the task of defining the mens rea and the actus reus of the Canadian offence of breach of trust by a public officer set out in s. 122. The matter is important.” Because reputation and liberty were at stake, the Court stated that “Public officers, like other members of the public, are entitled to know where the line lies that distinguishes administrative fault from criminal liability.” (Ibid, at para 47)

Normally Judges “should” be relying on case precedent for guidance. But here, it looks like the Trial Judge has been looking for excuses to minimize or defends Duffy’s actions. Again and again he bends over backwards to excuse Duffy’s actions are negligence or carelessness.

The Judge then goes on to discuss several other, related rulings.

Willful Blindness As A Defence
WILFUL BLINDNESS

[824] Mr. Holmes directs the court’s attention to the concept and principles of wilful blindness.

[825] Wilful blindness exists where “a person who has become aware of the need for some inquiry declines to make the inquiry because he does not wish to know the truth.” It requires “actual suspicion, combined with a conscious decision not to make inquiries which could confirm that suspicion.” (R. v. Sansregret, [1985] 1 S.C.R. 570 at paras 21-22; R. v. Duong, [1998] O.J. No. 1681 Ont. C.A. at para 23)

[826] Wilful blindness is purely subjective. “The question is not whether the accused should have been suspicious, but whether the accused was in fact suspicious.” (R. v. Malfara, [2006] O.J. No. 2069 Ont. C.A. at para 2)

[827] Where wilful blindness is found, the law deems knowledge on the part of the accused. Put another way, wilful blindness will fulfil the mens rea requirement. Doherty J.A., in R. v. Duong, supra, at paragraph 23 states
[23] […] Where the Crown proves the existence of a fact in
issue and knowledge of that fact is a component of the fault
requirement of the crime charged, wilful blindness as to the
existence of that fact is sufficient to establish a culpable
state of mind.

A serious question: how do you prove that someone “has become aware”? Other than a written or oral confession, how does one actually prove state of mind?

[928] Nigel Wright states his go forward plan as follows: “As regards Senate expenses, the concept of a primary residence implies the existence of at least one other residence, So Mike could be primarily resident in the NCR for expense rules and still be constitutionally resident in P.E.I. That leaves the very big problem of his having collected $900.00 per month . The only plausible ways out of that are (i) it was wrong and he has to be disciplined and/or repay, or (ii) there was ambiguity so it will be clarified and he will not claim the amount going forward. Marjory assures me that no other CPC Senator claims the $900.00 per month in similar circumstances. Mike said that no one ever told him he shouldn’t be doing it. (email #33)

[929] Mr. Bayne submits that ultimately this plan was shown/proven to be a bad plan because, although politically “plausible” (per Nigel Wright), it involved deliberate deceits and a cover-up. Mr. Bayne suggests that the main weakness of the proposal is that Senator Duffy was never willing to acknowledge a mistake or commit to personally repaying the money.

[930] Mr. Bayne maintains that Nigel Wright and Senator Tkachuk believed that Senator Duffy’s claims were within the existing Senate rules but that that approach presented a political perceptual problem. Therefore, they opted for a dishonest strategy as opposed to an honest one involving a rules problem. Counsel points out that it is important to note that Nigel Wright had done his own legal analysis of the Senate rules and knew/believed that Senator Duffy was probably right; that the expense claims for NCR residence were probably valid; and that Senator Duffy was probably legally and technically right. However, from Nigel Wright’s perspective, the situation was politically embarrassing and creating public agony. Therefore, Mr. Wright opted for and orchestrated a non-principled solution that was politically opportune.

Have to love the logic here: Duffy is portrayed as an innocent victim of the scheming Nigel Wright/Stephen Harper, all while collecting $900/month under rules that even a child would know are wrong. While these are the submissions of the defence counsel, the judge ultimately did buy it.

Some Final Thoughts
-The ruling was 308 pages. Literally a book.
-The Trial Judge passes over overt fraud as minor accidents
-Ambiguity in the rules is (improperly I believe) used to shield obvious fraud
-Judge seems to have good grasp of “law”, but
-Judge shows incredibly poor grasp of “fact”
-I don’t believe Duffy at all
-This article does not cover every detail, just the major ones.

Finally, it is a very serious accusation to accuse a judge of “throwing” a case. However, I can’t see how any skilled experienced judge would come to these conclusions. Mike Duffy is a sitting senator, but not expected to be able to show any judgement whatsoever?