Takeaways from conflict-of-interest case

Opinion

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This article was published 25/03/2023 (924 days ago), so information in it may no longer be current.

On March 13 a judge ruled that Manitoba Premier Heather Stefanson failed to disclose the sale of three properties as required by conflict-of-interest (COI) legislation. However, the judge also concluded that under the current law, she could not impose a penalty because the failure was inadvertent.

On a related issue, the judge ruled that, despite her ownership of rental properties, the premier was not prohibited from debating and voting on a bill amending the Residential Tenancies Act.

This outcome reflected the problems associated with the existing law, which will be replaced by a new law that comes into effect after the next election. This means the recent case will have limited value as a precedent for future application of the COI law.

Liberal Leader Dougald Lamont brought the case before the court, insisting he was not trying to score political points, but rather was seeking an interpretation of the existing law in a situation where he believed the premier was guilty of a conflict of interest.

The current law provides that violations of the law can result in a 90-day suspension from the legislature, a fine of up to $5,000, a requirement to repay any financial loss to government, and, in a worst-case scenario, an MLA being removed from office.

Lamont called for the first two sanctions to be imposed on the premier, but the judge rejected this action.

Here are my takeaways from the ruling.

The judge reached her conclusions quickly, which was appropriate. A premier should not be facing serious allegations for an extended period. Moreover, having an appointed judge remove or suspend a premier from the performance of her duties may be allowed under the current law, but it is problematic in a democratic system.

According to the judge, the premier was careless in failing to comply with the law, but there was not a deliberate attempt to evade its requirement to update her portfolio of assets in a timely manner. This interpretation gives the premier the benefit of the doubt in terms of her motivation and behaviour.

The foundation for this conclusion is not entirely clear. It may be based on the premier’s previous compliance with the requirement for annual declarations and her approach to the COI commissioner seeking advance advice on whether she should recuse herself on the amendments to the Residential Tenancies Act.

There is also the fact that, in the absence of hard evidence, judges generally avoid questioning the motivations of elected politicians.

Critics will argue it strains credulity for Stefanson (who has served more than 20 years in the legislature) to claim her failure to report was a simple oversight. The premier reported she had consulted the COI commissioner regarding the real estate transaction. If she had requested, as is allowed under the current law, a written opinion from the commissioner, that document would have been placed in her declaration file, which is open to public inspection.

The real estate deal happened at a time (July 2019) when then-premier Brian Pallister was musing about an early election, which took place in September. In that context, it could have been judged politically safer to rely on oral advice from the commissioner. His advice almost certainly was that the premier had to report.

The second part of the ruling — that there was no reason for the premier to recuse herself from debates and votes on amendments to the Residential Tenancies law — was not a surprise. The courts have argued that conflicts of interest do not arise when the matters under discussion involve policies and programs of general application within society. The judge concluded that the premier would not benefit more than other landlords and citizens in general.

MLAs serving after the next election will probably find the new law intrusive, because it requires far greater disclosure of their and their families’ private financial circumstances, and it establishes new rules regarding gifts MLAs can accept. It also authorizes the commissioner, based on complaints received from MLAs, to conduct investigations.

The new law provides for a continuum of sanctions/penalties for violations, including potential monetary penalties, as recommended by the commissioner. The legislature, not a judge, will make the final decision, but it can only impose sanctions recommended by the commissioner.

The premier escaped with what amounted to a mild legal reprimand and suffered some short-term political embarrassment. The Liberal leader earned some media coverage, but there will be disagreement over whether his court challenge served the public interest or was an opportunistic political gimmick. Given the abstract, legal nature of the issues involved, the episode will fade into the background.

Paul G. Thomas is professor emeritus of political studies at the University of Manitoba