Two Vaughan Conservatives have quit their riding association over a $10 million federal grant given to a health care project spearheaded by MP Julian Fantino’s former fundraisers.
“I’m a Canadian and a taxpayer first,” said Richard Lorello, who ran as a Conservative candidate in the riding in 2008. “It didn’t look right to me. If it was the Liberal party doing this, (the) Conservatives would be jumping up and down.”
Tracey Kent, a five-year member of the association, also resigned.
The federal government announced in March it would give $10 million to the Vaughan Health Campus of Care, a private non-profit group founded in 2007 with the intention of bringing a hospital to the city. Despite its population of 300,000, Vaughan doesn’t have a hospital.
Michael DeGasperis, the hospital group’s chair, and Sam Ciccolini, the director, ran Fantino’s successful byelection fundraising campaign in November 2010.
“It seems to me like we’re rewarding people for helping Mr. Fantino on his campaign,” Lorello said. “It doesn’t look right. It’s inappropriate.”
The grant money itself won’t go toward constructing a hospital, which is a provincial task. Instead, it’s earmarked to help develop a site for health-related facilities to complement a hospital planned for a 35-hectare lot.
Lorello is uncomfortable with $10 million in public funds going to a private company he claims has yet to publicly release a business plan.
He believes Ottawa would have been better off giving the money directly to York Central Hospital, which is in charge of bringing the hospital to Vaughan.
“I had actually requested to meet with Mr. Fantino and I was told to put my concerns in writing,” Lorello said. “I kind of took exception to that because all I was going to do was provide some advice.”
Fantino’s campaign manager said the Vaughan Health Campus has been well-received by the community and will benefit “families, seniors and the region’s economy.”
“The (investment) made to (the Vaughan Health Campus) is to create a life science industry at the campus and for infrastructure,” said Stephen Lecce. “Mr. Fantino is proud the federal government delivered for this critical community-based project for families in Vaughan that is being widely supported by volunteers and donors.”
York Central Hospital welcomed the new funding, saying the complementary health care services would benefit the people of Vaughan.
Tony Genco, then a Liberal candidate who’d just lost to Fantino in the byelection, also praised the initiative. Two weeks later, Genco defected and threw his weight behind his former rival.
When asked about Lorello’s concerns, Mario Ferri, Liberal candidate for Vaughan, said he supports “additional funding for health care in Vaughan.
“I also expect, as do my fellow residents of Vaughan, that funding is provided based on the merits of a project and the results it will bring in health care, not on who is involved,” Ferri said.
Tracey Kent said she quit the riding association because she lost faith in Fantino, who once headed the Toronto police and the OPP, and could no longer support the direction of the party. Her existing concerns were magnified when the federal grant money went to the Vaughan Health Campus, she said.
“We have a bad reputation in Vaughan,” Kent said. “I was hoping (Fantino) was going to be that white knight to fix it. But when I saw some of the activity going on, I knew it was the same old politics again.”
The citizens of Vaughan deserve “absolute transparency” from the Vaughan Health Campus, she said.
Vaughan Health Campus officials did not respond to requests for interviews Wednesday evening.
Lorello formally resigned from the riding association on April 4 but said he still considers himself a Conservative.
“It’s disappointing,” he said. “But I have to be truthful with myself.”
Thursday, April 14, 2011
Wednesday, April 13, 2011
In the Matter of a Reference by Governor in Council concerning the proposed Canadian Securities Act, as set out in Order in Council P.C. 2010-667, dated May 26, 2010 Supreme Court of Canada
Summary
Constitutional law - Division of powers - Commercial law - Negotiable instruments - Securities - Reference
Her Excellency the Governor General in Council, on the recommendation of the Minister of Justice and the Minister of Finance, pursuant to section 53 of the Supreme Court Act, R.S.C. 1985, c. S 26, refers to the Supreme Court of Canada for hearing and consideration the following question:
Is the proposed Canadian Securities Act within the legislative authority of the Parliament of Canada?
Constitutional law - Division of powers - Commercial law - Negotiable instruments - Securities - Reference
Her Excellency the Governor General in Council, on the recommendation of the Minister of Justice and the Minister of Finance, pursuant to section 53 of the Supreme Court Act, R.S.C. 1985, c. S 26, refers to the Supreme Court of Canada for hearing and consideration the following question:
Is the proposed Canadian Securities Act within the legislative authority of the Parliament of Canada?
Tuesday, April 12, 2011
Harper met Bruce Carson’s escort lover at 24 Sussex
Bruce Carson took his former fiancee Barbara Lynn Khan to meet Prime Minister Stephen Harper on the grounds of his official residence during a going away party for the prime minister’s outgoing chief of staff Ian Brodie.
Khan told APTN that she found Harper “approachable” and “friendly” during a conversation.
A Conservative Party spokesperson confirmed Monday that Khan visited the grounds of 24 Sussex during the June 2008 garden party.
Khan was deported to Canada from the U.S in 2006 on a felony conviction stemming from her part in running an escort agency in Charlotte, North Carolina.
“I can confirm that (Khan) was at Mr. Brodie’s farewell party at 24 Sussex,” said Conservative Party spokesperson Alykhan Velshi, in an email. “That’s the only time we are aware of that she visited 24 Sussex.”
Khan said her conversation with Harper dispelled in her mind the caricature of the prime minister often portrayed in the media.
“I was surprised because Harper is portrayed as being cold and indifferent, which I did not see a hint of that evening,” said Khan.
“Mrs. (Laureen) Harper was genuinely warm and an incredibly gracious hostess…Everyone attending was pleasant and the evening was an experience I will always remember.”
Carson, a former senior adviser to the prime minister, is currently the focus of an RCMP investigation triggered by a request from the Prime Minister’s Office.
Carson met Khan by chance on an Ottawa street shortly after she came back to Canada and was working as an escort. Their relationship ended last year after about four years.
The PMO made the written request to the RCMP after an official met with APTN reporters investigating Carson’s lobbying activities for an Ottawa-based water filtration company. The company was seeking to sell its product to First Nations communities hard hit by dirty water.
The company, H2O Pros which later formed H2O Global Group to deal with potential contracts, also had a financial agreement with Michele McPherson, a former Ottawa escort who Carson said was his fiancee.
Carson met McPherson in March 2010 and Khan in 2006.
APTN obtained emails written by Carson where he promoted the company to Indian Affairs officials. Carson also claimed to have inside government knowledge in the emails.
Brodie was Harper’s chief of staff until he left the post on July 1, 2008.
In an email to APTN, Brodie said he remembered Carson at the party, but not Khan.
“I remember Bruce was there, but otherwise, can’t help,” said Brodie.
The PMO referred questions about Khan’s presence at 24 Sussex to the Conservative Party.
The PMO, however, continues to refuse comment on whether Carson, who had only Secret-level clearance, had access to Top Secret information on Afghanistan and on Canadian allies involved in the war.
Quoting an anonymous source, the Toronto Star reported last week that Carson had access to Top Secret information after he was handed the Afghanistan file.
“We don’t comment on security matters,” said the PMO in an emailed statement.
Brodie told APTN he doubted Carson had access to Top Secret files, which were handled separately and securely.
The Canadian Security Intelligence Service, Department of National Defence and Foreign Affairs all referred questions on the matter to the Privy Council Office (PCO).
A PCO spokesman said there would be no comment on current or former employees.
Harper has faced questions throughout the election campaign over how Carson could have obtained security clearance with five criminal convictions on his record and two bankruptcies.
Harper has said he was only aware of Carson’s two criminal convictions in the 1980s, not the three convictions in 1990 uncovered by The Canadian Press.
Harper said he would not have hired Carson is he knew the full extent of his criminal record.
Carson, who told APTN he was a close friend of Harper, said he disclosed everything during the security clearance process, which was handled by mid-level PCO officials.
Khan told APTN that she found Harper “approachable” and “friendly” during a conversation.
A Conservative Party spokesperson confirmed Monday that Khan visited the grounds of 24 Sussex during the June 2008 garden party.
Khan was deported to Canada from the U.S in 2006 on a felony conviction stemming from her part in running an escort agency in Charlotte, North Carolina.
“I can confirm that (Khan) was at Mr. Brodie’s farewell party at 24 Sussex,” said Conservative Party spokesperson Alykhan Velshi, in an email. “That’s the only time we are aware of that she visited 24 Sussex.”
Khan said her conversation with Harper dispelled in her mind the caricature of the prime minister often portrayed in the media.
“I was surprised because Harper is portrayed as being cold and indifferent, which I did not see a hint of that evening,” said Khan.
“Mrs. (Laureen) Harper was genuinely warm and an incredibly gracious hostess…Everyone attending was pleasant and the evening was an experience I will always remember.”
Carson, a former senior adviser to the prime minister, is currently the focus of an RCMP investigation triggered by a request from the Prime Minister’s Office.
Carson met Khan by chance on an Ottawa street shortly after she came back to Canada and was working as an escort. Their relationship ended last year after about four years.
The PMO made the written request to the RCMP after an official met with APTN reporters investigating Carson’s lobbying activities for an Ottawa-based water filtration company. The company was seeking to sell its product to First Nations communities hard hit by dirty water.
The company, H2O Pros which later formed H2O Global Group to deal with potential contracts, also had a financial agreement with Michele McPherson, a former Ottawa escort who Carson said was his fiancee.
Carson met McPherson in March 2010 and Khan in 2006.
APTN obtained emails written by Carson where he promoted the company to Indian Affairs officials. Carson also claimed to have inside government knowledge in the emails.
Brodie was Harper’s chief of staff until he left the post on July 1, 2008.
In an email to APTN, Brodie said he remembered Carson at the party, but not Khan.
“I remember Bruce was there, but otherwise, can’t help,” said Brodie.
The PMO referred questions about Khan’s presence at 24 Sussex to the Conservative Party.
The PMO, however, continues to refuse comment on whether Carson, who had only Secret-level clearance, had access to Top Secret information on Afghanistan and on Canadian allies involved in the war.
Quoting an anonymous source, the Toronto Star reported last week that Carson had access to Top Secret information after he was handed the Afghanistan file.
“We don’t comment on security matters,” said the PMO in an emailed statement.
Brodie told APTN he doubted Carson had access to Top Secret files, which were handled separately and securely.
The Canadian Security Intelligence Service, Department of National Defence and Foreign Affairs all referred questions on the matter to the Privy Council Office (PCO).
A PCO spokesman said there would be no comment on current or former employees.
Harper has faced questions throughout the election campaign over how Carson could have obtained security clearance with five criminal convictions on his record and two bankruptcies.
Harper has said he was only aware of Carson’s two criminal convictions in the 1980s, not the three convictions in 1990 uncovered by The Canadian Press.
Harper said he would not have hired Carson is he knew the full extent of his criminal record.
Carson, who told APTN he was a close friend of Harper, said he disclosed everything during the security clearance process, which was handled by mid-level PCO officials.
Monday, April 11, 2011
Harper V Mulroney.
It was an illuminating moment in a remarkably candid conversation.
Brian Mulroney, the most successful Conservative prime minister since Sir John A. Macdonald, was sitting down for a rare television interview the other day in Montreal.
TVOntario’s Steve Paikin, always adroit at coaxing politicians to dish, broached the subject of the May 2 election and Conservative Leader Stephen Harper.
“You’re voting for Mr. Harper, I take it,” said Paikin, coincidentally the moderator of Tuesday’s English-language leaders’ debate.
“At this point,” replied Mulroney with a pause that seemed to hang in the air longer than its mere second, “I’ll vote for the Conservative candidate in my constituency.”
Although the architect of decisive Progressive Conservative victories in 1984 and 1988 conceded that Harper is “clearly a competent Prime Minister,” his unease with the current Tory leader was barely concealed.
He praised Liberal Leader Michael Ignatieff (“an intelligent man, hard-working guy”), NDP Leader Jack Layton (“an outstanding leader of his party”), and even Bloc Québécois Leader Gilles Duceppe (“respected in Quebec”), whose party began in 1990 as a separatist offshoot of Mulroney’s Tories.
He suggested Ignatieff could win despite polls indicating otherwise: “You never can tell what happens in political life. I’ll tell you this, in 1984, when the campaign started I was 14 points behind. We ended up in a rather different fashion.”
He touted former Liberal prime minister Lester Pearson, who endured similar political uncertainty to Harper, but had far more to show for his tenure, including medicare and the Maple Leaf flag: “You can do big things — even if you have a minority Parliament. Witness what happened with Mr. Pearson, who achieved great things with minority status.”
And he pointedly dismissed a central tenet of the Conservative campaign, the spectre of an Ignatieff-Layton-Duceppe government: “They should not speculate in any way about coalitions or all of this nonsense.”
Certainly, Mulroney is still smarting from fallout of his ill-advised business dealings with German lobbyist Karlheinz Schreiber, now in prison serving an eight-year sentence for tax evasion.
Confidants say he feels like he was “thrown under a bus” over the Schreiber affair by people he trusted in the highest levels of the Harper government and such wounds are unlikely to easily heal.
“You have to understand, nothing matters more to him than loyalty,” said an associate. “And he feels he was betrayed by some people who wouldn’t be where they are if it weren’t for him.”
Yet, several Tories insist, there is more at play here than just personal slights.
Mulroney — like others from disparate wings of the Conservative Party of Canada, be they former Reformers or Progressive Conservatives — appears disappointed by Harper’s paucity of ambition.
Reform Party founder Preston Manning famously urged Canadian conservatives to “think big,” but his one-time underling has for the most part governed cautiously, using the constraints of a minority Parliament as an excuse for the lack of any major initiative.
“Being in power is better than not being in power,” explained one Tory MP, who like others interviewed spoke on condition of anonymity because they are not authorized to publicly discuss such machinations.
The MP noted Harper spent years in opposition as a Reform MP, Canadian Alliance leader, and, finally, Conservative leader, so survival in government trumps any sweeping policy dream he may once have espoused.
“It’s as simple as that,” the Tory member said, emphasizing that Harper’s greatest legacy was “uniting the right” to create a viable and enduring alternative to the Liberals.
Still, after a middling half-decade in power, some Tories wonder what else the history books will say about Harper.
“What, really, have we got to show for our five years in office?” asked a former senior official in the Prime Minister’s Office.
“An accountability act that forces us to hire kids,” the insider said with a scoff, referring to the legislation designed to curb lobbying that has made it difficult for the Tories to attract talent to government.
Even the few accomplishments that actually touch Canadians’ day-to-day lives are questioned.
Sources say Mulroney, who created the goods and services tax two decades ago, has privately expressed concerned about Harper’s reducing the GST rate from 7 per cent to 5 per cent. (It has since been melded with the 8 per cent provincial sales tax into a 13 per cent harmonized sales tax.)
“He should have lowered income taxes instead. Conservatives believe in taxing consumption, not output. How does a GST cut increase productivity?” fumed a veteran Tory.
A Mulroney-ite attacking Harper’s conservative bona fides?
It gets worse.
With the retirement from electoral politics of Reform and Canadian Alliance icons Chuck Strahl, Jay Hill, and Stockwell Day, it’s apparently not just the Conservatives’ centrist Mulroney wing that feels ornery.
There was Alberta conservative stalwart Link Byfield on the front page of the National Post last Tuesday, complaining that Harper has “systematically suppressed debate” on matters such as same-sex marriage and abortion.
“Harper has made it abundantly and compellingly clear that the social conservative agenda is not to be contemplated in his government and not to be advocated or advanced. And he will have come to this conclusion because he has seen it necessary to get centre voters. As long as he’s leader that will remain the case,” Byfield told journalist Charles Lewis.
Such fractiousness can, of course, be viewed as growing pains in a maturing political party.
But something Mulroney told Paikin lingers longer than the one-second dramatic pause over his voting intentions.
“There are big ideas out there,” said the man who helped end apartheid in South Africa and gave Canada free trade with the United States.
“Popularity is meaningless unless you use it to do big and good things for your country and for the people of Canada.”
Brian Mulroney, the most successful Conservative prime minister since Sir John A. Macdonald, was sitting down for a rare television interview the other day in Montreal.
TVOntario’s Steve Paikin, always adroit at coaxing politicians to dish, broached the subject of the May 2 election and Conservative Leader Stephen Harper.
“You’re voting for Mr. Harper, I take it,” said Paikin, coincidentally the moderator of Tuesday’s English-language leaders’ debate.
“At this point,” replied Mulroney with a pause that seemed to hang in the air longer than its mere second, “I’ll vote for the Conservative candidate in my constituency.”
Although the architect of decisive Progressive Conservative victories in 1984 and 1988 conceded that Harper is “clearly a competent Prime Minister,” his unease with the current Tory leader was barely concealed.
He praised Liberal Leader Michael Ignatieff (“an intelligent man, hard-working guy”), NDP Leader Jack Layton (“an outstanding leader of his party”), and even Bloc Québécois Leader Gilles Duceppe (“respected in Quebec”), whose party began in 1990 as a separatist offshoot of Mulroney’s Tories.
He suggested Ignatieff could win despite polls indicating otherwise: “You never can tell what happens in political life. I’ll tell you this, in 1984, when the campaign started I was 14 points behind. We ended up in a rather different fashion.”
He touted former Liberal prime minister Lester Pearson, who endured similar political uncertainty to Harper, but had far more to show for his tenure, including medicare and the Maple Leaf flag: “You can do big things — even if you have a minority Parliament. Witness what happened with Mr. Pearson, who achieved great things with minority status.”
And he pointedly dismissed a central tenet of the Conservative campaign, the spectre of an Ignatieff-Layton-Duceppe government: “They should not speculate in any way about coalitions or all of this nonsense.”
Certainly, Mulroney is still smarting from fallout of his ill-advised business dealings with German lobbyist Karlheinz Schreiber, now in prison serving an eight-year sentence for tax evasion.
Confidants say he feels like he was “thrown under a bus” over the Schreiber affair by people he trusted in the highest levels of the Harper government and such wounds are unlikely to easily heal.
“You have to understand, nothing matters more to him than loyalty,” said an associate. “And he feels he was betrayed by some people who wouldn’t be where they are if it weren’t for him.”
Yet, several Tories insist, there is more at play here than just personal slights.
Mulroney — like others from disparate wings of the Conservative Party of Canada, be they former Reformers or Progressive Conservatives — appears disappointed by Harper’s paucity of ambition.
Reform Party founder Preston Manning famously urged Canadian conservatives to “think big,” but his one-time underling has for the most part governed cautiously, using the constraints of a minority Parliament as an excuse for the lack of any major initiative.
“Being in power is better than not being in power,” explained one Tory MP, who like others interviewed spoke on condition of anonymity because they are not authorized to publicly discuss such machinations.
The MP noted Harper spent years in opposition as a Reform MP, Canadian Alliance leader, and, finally, Conservative leader, so survival in government trumps any sweeping policy dream he may once have espoused.
“It’s as simple as that,” the Tory member said, emphasizing that Harper’s greatest legacy was “uniting the right” to create a viable and enduring alternative to the Liberals.
Still, after a middling half-decade in power, some Tories wonder what else the history books will say about Harper.
“What, really, have we got to show for our five years in office?” asked a former senior official in the Prime Minister’s Office.
“An accountability act that forces us to hire kids,” the insider said with a scoff, referring to the legislation designed to curb lobbying that has made it difficult for the Tories to attract talent to government.
Even the few accomplishments that actually touch Canadians’ day-to-day lives are questioned.
Sources say Mulroney, who created the goods and services tax two decades ago, has privately expressed concerned about Harper’s reducing the GST rate from 7 per cent to 5 per cent. (It has since been melded with the 8 per cent provincial sales tax into a 13 per cent harmonized sales tax.)
“He should have lowered income taxes instead. Conservatives believe in taxing consumption, not output. How does a GST cut increase productivity?” fumed a veteran Tory.
A Mulroney-ite attacking Harper’s conservative bona fides?
It gets worse.
With the retirement from electoral politics of Reform and Canadian Alliance icons Chuck Strahl, Jay Hill, and Stockwell Day, it’s apparently not just the Conservatives’ centrist Mulroney wing that feels ornery.
There was Alberta conservative stalwart Link Byfield on the front page of the National Post last Tuesday, complaining that Harper has “systematically suppressed debate” on matters such as same-sex marriage and abortion.
“Harper has made it abundantly and compellingly clear that the social conservative agenda is not to be contemplated in his government and not to be advocated or advanced. And he will have come to this conclusion because he has seen it necessary to get centre voters. As long as he’s leader that will remain the case,” Byfield told journalist Charles Lewis.
Such fractiousness can, of course, be viewed as growing pains in a maturing political party.
But something Mulroney told Paikin lingers longer than the one-second dramatic pause over his voting intentions.
“There are big ideas out there,” said the man who helped end apartheid in South Africa and gave Canada free trade with the United States.
“Popularity is meaningless unless you use it to do big and good things for your country and for the people of Canada.”
Sunday, April 10, 2011
pension decision has far-reaching implications
Employees of insolvent companies will have a better chance of collecting their pensions after a surprise court decision transformed the law around corporate bankruptcies in Ontario.
The Ontario Court of Appeal on Thursday ruled in favour of the former staff of a failed manufacturer that was seeking to use the proceeds from the sale of the company's assets to cover shortfalls in their under-funded pension plans.
Pension-plan members are usually last in the lineup of creditors when an employer goes under, and often lose their retirement nest eggs. But the court upset that traditional pecking order, and its decision has ramifications well beyond the aluminum company, Indalex, which had a $6.75-million pension-plan shortfall when it filed for creditor protection under Canada’s federal Companies’ Creditors Arrangement Act in 2009, and well beyond Ontario.
“Indalex knew that the plans were under-funded and that unless more funds were put into the plans, pensions would have to be reduced,” the court said in a decision written by Madam Justice Eileen Gillese, who is known as one of Canada’s foremost pension law experts. “The decisions that Indalex was unilaterally making had the potential to affect the plans’ beneficiaries’ rights, at a time when they were particularly vulnerable.”
In her ruling, she said Indalex failed to inform pension plan members about the CCAA hearing, and did not protect their interests. The judge also said the company did not clearly inform the lower court about its pension issues.
Pensioners’ vulnerability to bankruptcy proceedings drew attention during the recession of 2008 and 2009, when corporate failures spiked and pension plans across the country faced shortfalls estimated at $50-billion during the worst of the downturn. Politicians have done little to elevate the rights of pension plan members in bankruptcy cases, leaving courts to fall back on traditional precedents, awarding creditors first dibs on companies’ remains.
Over the past few years, high-profile insolvencies at such companies as Nortel Networks Corp., AbitibiBowater Inc., Fraser Papers Inc., Slater Steel Inc., and CanWest Global Communications Corp. left employees with reduced pensions. In many cases, other creditors and bondholders ranked ahead of the pension plans when remaining assets were distributed to creditors. Retirees of Nortel have lobbied the federal government for new legislation giving pension funds higher priority in bankruptcies, but have so far found no government support.
The Ontario Court of Appeal ruling could change that trend, however, by setting higher standards for companies when dealing with pensioners. The ruling means that companies in a CCAA proceeding cannot automatically ignore an under-funded pension plan. Instead, companies will have to first make a case in court that they cannot meet their pension obligations.
“Companies can’t ignore pensioners in insolvency proceedings, and they have to take steps to deal with pension deficiencies,” said Andrew Hatnay, a lawyer with Koskie Minsky LLP, who represented 16 former managers and executives of the company who were facing a 60-per-cent cut to their pension income. The ruling is a “wake-up call” for companies in bankruptcy protection, he said.
He said it was not clear the ruling would always send pension-plan members to the front of the line during an insolvency proceeding.
While about 40 per cent of proceedings under CCAA take place in Ontario, the ruling could influence courts across the country. An appeal to the Supreme Court of Canada is possible, but it will stand as precedent-setting in the meantime.
Indalex’s descent into court proceedings is one that has played out for embattled companies across the country. The Toronto-based company, battered by the collapse of the U.S. housing market and a slump in the price of aluminum, filed for court protection from its creditors in April, 2009. Both its employee and executive pension plans had massive shortfalls, leaving workers facing sharp reductions to their pensions as the plans were being wound up.
As is common in such proceedings, Indalex arranged a loan known as debtor-in-possession (DIP) financing to help cover its costs while it was shutting down its operations under the creditors arrangement act. A condition of the loan gave the lender priority over the rest of the company’s other creditors – including the pension funds.
Pension-plan members challenged the arrangement in court, arguing they should have the right to any remaining assets of the company, which has since been sold.
The ruling caught Ontario’s pension community by surprise because insolvent companies typically pay secured creditors ahead of the claims in their pension plans.
“This would seem to change the landscape quite a bit,” said Toronto pension lawyer Hugh O’Reilly, who represented the actuarial firm appointed as the administrator of the Indalex pension plans.
Mr. O’Reilly said the decision means companies will have to follow more stringent processes in the future to ensure the rights of pension plan members are represented, which is “an exciting development” in pension law.
“What it says now is that employees and retirees need to be at the table a lot sooner,” Mr. O’Reilly said.
The decision raises questions about how companies will be able to secure debtor-in-possession financing, said pension lawyer Mitch Frazer of Torys LLP.
In her ruling Thursday, Judge Gillese acknowledged the court did not want to hinder companies from being able to arrange financing when filing for court protection from creditors.
She said decisions should be made on a case-by-case basis and “there may well be” situations where the pension plans cannot receive priority.
Darrell Brown, a lawyer who represented the United Steelworkers in the case, said the company did not try to live up to its obligations to its employees: “Our argument was, the company has to show that they’ve made some effort to deal with this. Clearly, they didn’t.”
The Ontario Court of Appeal on Thursday ruled in favour of the former staff of a failed manufacturer that was seeking to use the proceeds from the sale of the company's assets to cover shortfalls in their under-funded pension plans.
Pension-plan members are usually last in the lineup of creditors when an employer goes under, and often lose their retirement nest eggs. But the court upset that traditional pecking order, and its decision has ramifications well beyond the aluminum company, Indalex, which had a $6.75-million pension-plan shortfall when it filed for creditor protection under Canada’s federal Companies’ Creditors Arrangement Act in 2009, and well beyond Ontario.
“Indalex knew that the plans were under-funded and that unless more funds were put into the plans, pensions would have to be reduced,” the court said in a decision written by Madam Justice Eileen Gillese, who is known as one of Canada’s foremost pension law experts. “The decisions that Indalex was unilaterally making had the potential to affect the plans’ beneficiaries’ rights, at a time when they were particularly vulnerable.”
In her ruling, she said Indalex failed to inform pension plan members about the CCAA hearing, and did not protect their interests. The judge also said the company did not clearly inform the lower court about its pension issues.
Pensioners’ vulnerability to bankruptcy proceedings drew attention during the recession of 2008 and 2009, when corporate failures spiked and pension plans across the country faced shortfalls estimated at $50-billion during the worst of the downturn. Politicians have done little to elevate the rights of pension plan members in bankruptcy cases, leaving courts to fall back on traditional precedents, awarding creditors first dibs on companies’ remains.
Over the past few years, high-profile insolvencies at such companies as Nortel Networks Corp., AbitibiBowater Inc., Fraser Papers Inc., Slater Steel Inc., and CanWest Global Communications Corp. left employees with reduced pensions. In many cases, other creditors and bondholders ranked ahead of the pension plans when remaining assets were distributed to creditors. Retirees of Nortel have lobbied the federal government for new legislation giving pension funds higher priority in bankruptcies, but have so far found no government support.
The Ontario Court of Appeal ruling could change that trend, however, by setting higher standards for companies when dealing with pensioners. The ruling means that companies in a CCAA proceeding cannot automatically ignore an under-funded pension plan. Instead, companies will have to first make a case in court that they cannot meet their pension obligations.
“Companies can’t ignore pensioners in insolvency proceedings, and they have to take steps to deal with pension deficiencies,” said Andrew Hatnay, a lawyer with Koskie Minsky LLP, who represented 16 former managers and executives of the company who were facing a 60-per-cent cut to their pension income. The ruling is a “wake-up call” for companies in bankruptcy protection, he said.
He said it was not clear the ruling would always send pension-plan members to the front of the line during an insolvency proceeding.
While about 40 per cent of proceedings under CCAA take place in Ontario, the ruling could influence courts across the country. An appeal to the Supreme Court of Canada is possible, but it will stand as precedent-setting in the meantime.
Indalex’s descent into court proceedings is one that has played out for embattled companies across the country. The Toronto-based company, battered by the collapse of the U.S. housing market and a slump in the price of aluminum, filed for court protection from its creditors in April, 2009. Both its employee and executive pension plans had massive shortfalls, leaving workers facing sharp reductions to their pensions as the plans were being wound up.
As is common in such proceedings, Indalex arranged a loan known as debtor-in-possession (DIP) financing to help cover its costs while it was shutting down its operations under the creditors arrangement act. A condition of the loan gave the lender priority over the rest of the company’s other creditors – including the pension funds.
Pension-plan members challenged the arrangement in court, arguing they should have the right to any remaining assets of the company, which has since been sold.
The ruling caught Ontario’s pension community by surprise because insolvent companies typically pay secured creditors ahead of the claims in their pension plans.
“This would seem to change the landscape quite a bit,” said Toronto pension lawyer Hugh O’Reilly, who represented the actuarial firm appointed as the administrator of the Indalex pension plans.
Mr. O’Reilly said the decision means companies will have to follow more stringent processes in the future to ensure the rights of pension plan members are represented, which is “an exciting development” in pension law.
“What it says now is that employees and retirees need to be at the table a lot sooner,” Mr. O’Reilly said.
The decision raises questions about how companies will be able to secure debtor-in-possession financing, said pension lawyer Mitch Frazer of Torys LLP.
In her ruling Thursday, Judge Gillese acknowledged the court did not want to hinder companies from being able to arrange financing when filing for court protection from creditors.
She said decisions should be made on a case-by-case basis and “there may well be” situations where the pension plans cannot receive priority.
Darrell Brown, a lawyer who represented the United Steelworkers in the case, said the company did not try to live up to its obligations to its employees: “Our argument was, the company has to show that they’ve made some effort to deal with this. Clearly, they didn’t.”
Saturday, April 9, 2011
Harper V Elections Act, 2002.
The issue of public subsidies for political parties resurfaced Friday, with Stephen Harper promising to eliminate funding if he achieves a parliamentary majority. Those with a three-year memory span will recall that the Tories were nearly defeated by the combined opposition when they proposed this move in 2008.
Those with a longer memory will recall that electoral finances and spending were pet issues of Mr. Harper before he entered federal politics. As head of the National Citizens Coalition, he brought a court action challenging election spending limits imposed on third-party interest groups. The Canada Elections Act, 2002, restricted spending during an election campaign by non-political parties to $150,000 nationally – roughly the cost of several full-page newspaper ads.
That case helps recall that Mr. Harper has long thought that a free-market economy and free-market democracy go hand in hand. The Supreme Court of Canada, however, rejected his challenge, ruling that spending limits are a justifiable limitation on individual rights. The court gave notice that, in Canada, political expression can be adjusted, and controlled, without concern that the Constitution requires this to be an area that government keep its hands off.
By coincidence, the question of electoral finance was before the U.S. Supreme Court last week. The justices heard a challenge aimed at striking down an Arizona law that provides matching funds to political candidates who accept public financing, allowing them to keep pace with those who privately finance their campaigns. The challenger, a political action committee, asked the court to rule that subsidies, like spending restrictions, infringe the First Amendment guarantee of free speech.
The U.S. court had already ruled in 2009 that the government can restrict campaign fundraising only for certain limited purposes, such as combatting corruption. What government in the U.S. can’t do is play social engineer, and use its legislative power to adjust the voice of parties whose access to the marketplace of dollars and ideas is too little or too great.
In one intriguing exchange, Chief Justice John Roberts told lawyers for Arizona that he had visited the website of the state’s electoral commission. As reported by The New York Times, he pointed out that Arizona claims its legislation “was passed to, quote, ‘level the playing field’ when it comes to running for office.” He then asked, “Why isn’t that clear evidence that it’s unconstitutional?”
The Supreme Court of Canada used the same phrase in its 2004 decision in the Harper case. Here, government intervention was ruled a constitutionally supportable act. As the court put it, creating “a level playing field for those who wish to engage in electoral discourse” is a perfectly valid objective. Where the U.S. Constitution demands increased speech during election time, the Canadian Charter of Rights justifies government’s levelling the competitive speech arena.
All of which illustrates that the 49th is not always so parallel. Indeed, the liberal social equation is made up of two vacillating halves: The U.S. constitutional system inclines toward liberty, while the Canadian system inclines toward equality.
Neither position, of course, is set in stone. Whether the Constitution increases the political freedom of those with the means to speak, or helps level off our freedoms for the sake of those who are only faintly heard, is always up for grabs.
Those with a longer memory will recall that electoral finances and spending were pet issues of Mr. Harper before he entered federal politics. As head of the National Citizens Coalition, he brought a court action challenging election spending limits imposed on third-party interest groups. The Canada Elections Act, 2002, restricted spending during an election campaign by non-political parties to $150,000 nationally – roughly the cost of several full-page newspaper ads.
That case helps recall that Mr. Harper has long thought that a free-market economy and free-market democracy go hand in hand. The Supreme Court of Canada, however, rejected his challenge, ruling that spending limits are a justifiable limitation on individual rights. The court gave notice that, in Canada, political expression can be adjusted, and controlled, without concern that the Constitution requires this to be an area that government keep its hands off.
By coincidence, the question of electoral finance was before the U.S. Supreme Court last week. The justices heard a challenge aimed at striking down an Arizona law that provides matching funds to political candidates who accept public financing, allowing them to keep pace with those who privately finance their campaigns. The challenger, a political action committee, asked the court to rule that subsidies, like spending restrictions, infringe the First Amendment guarantee of free speech.
The U.S. court had already ruled in 2009 that the government can restrict campaign fundraising only for certain limited purposes, such as combatting corruption. What government in the U.S. can’t do is play social engineer, and use its legislative power to adjust the voice of parties whose access to the marketplace of dollars and ideas is too little or too great.
In one intriguing exchange, Chief Justice John Roberts told lawyers for Arizona that he had visited the website of the state’s electoral commission. As reported by The New York Times, he pointed out that Arizona claims its legislation “was passed to, quote, ‘level the playing field’ when it comes to running for office.” He then asked, “Why isn’t that clear evidence that it’s unconstitutional?”
The Supreme Court of Canada used the same phrase in its 2004 decision in the Harper case. Here, government intervention was ruled a constitutionally supportable act. As the court put it, creating “a level playing field for those who wish to engage in electoral discourse” is a perfectly valid objective. Where the U.S. Constitution demands increased speech during election time, the Canadian Charter of Rights justifies government’s levelling the competitive speech arena.
All of which illustrates that the 49th is not always so parallel. Indeed, the liberal social equation is made up of two vacillating halves: The U.S. constitutional system inclines toward liberty, while the Canadian system inclines toward equality.
Neither position, of course, is set in stone. Whether the Constitution increases the political freedom of those with the means to speak, or helps level off our freedoms for the sake of those who are only faintly heard, is always up for grabs.
Friday, April 8, 2011
stephen harper is bad news Parliamentary dispute and prorogation Vote of non-confidence
federal election,
On October 14, 2008, after a 5 week long campaign, the Conservative Party won a federal election and increased its number of seats in parliament to 143, up from 127 at the dissolution of the previous parliament; however, the actual popular vote among Canadians dropped slightly by 167,494 votes. As a result of the lowest voter turnout in Canadian electoral history, this represented only 22% of eligible Canadian voters, the lowest level of support of any winning party in Canadian history.[94] Meanwhile, the number of opposition Liberal MPs fell from 95 to 77 seats. It takes 155 MPs to form a majority government in Canada's 308 seat Parliament.
2008 Parliamentary dispute and prorogationMain article: 2008 Canadian parliamentary dispute
On December 4, 2008, Harper asked Governor General Michaëlle Jean to prorogue Parliament in order to avoid a vote of confidence scheduled for the following Monday, becoming the first Canadian PM ever to do so.[95][96] The request was granted by Jean, and the prorogation lasted until January 26, 2009. The opposition coalition dissolved shortly after, with the Conservatives winning a Liberal supported confidence vote on January 29, 2009.
2010 prorogationSee also: 2010 Canada anti-prorogation protests and Prorogation in Canada
On December 30, 2009, Harper announced that he would request the governor general prorogue parliament again, effective immediately on December 30, 2009, during the 2010 Winter Olympics and lasting until March 3, 2010. Harper stated that this was necessary for Canada's economic plan. Jean would grant the request. In an interview with CBC News, Prince Edward Island Liberal member of parliament Wayne Easter accused the Prime Minister of "shutting democracy down".[97][98] Tom Flanagan, Harper's University of Calgary mentor and former Chief of Staff, also questioned Harper's reasoning for prorogation, stating that "I think the government's talking points haven't been entirely credible" and that the government's explanation of proroguing was "skirting the real issue -- which is the harm the opposition parties are trying to do to the Canadian Forces" regarding the Canadian Afghan detainee issue.[99] The second prorogation in a year also received some international criticism as being undemocratic.[100] Demonstrations took place on January 23 in 64 Canadian cities and towns, and five cities in other countries.[101] A Facebook protest group attracted over 20,000 members.[102]
A poll released by Angus Reid on January 7, found that 53% of Canadians were opposed to the prorogation, while 19% supported it. 38 per cent of Canadians believed that Harper used the prorogation to curtail the Afghan detainee inquiry, while 23% agreed with Harper's explanation that the prorogation was necessary economically.[103]
2010 Senate appointmentsHarper filled five vacancies in the Senate of Canada with appointments of new Conservative senators, on January 29, 2010. The Senators filled vacancies in Quebec, Newfoundland and Labrador, and New Brunswick, as well as two vacancies in Ontario. The new senators were Pierre-Hugues Boisvenu, of Quebec, Bob Runciman, of Ontario, Vim Kochhar, of Ontario, Elizabeth Marshall of Newfoundland and Labrador and Rose-May Poirier, of New Brunswick.
This changed the party standings in the Senate, which had been dominated by Liberals, to 51 Conservatives, 49 Liberals, and five others.[104][105]
2011 Vote of non-confidenceHarper's Conservative government was defeated in a no-confidence vote on March 25, 2011, after being found in contempt of parliament, thus triggering a general election.[106] This was the first occurrence in Commonwealth history of a government in the Westminster parliamentary tradition losing the confidence of the House of Commons on the grounds of contempt of Parliament. The no-confidence motion was carried with a vote of 156 in favor of the motion, and 145 against.[107]
On October 14, 2008, after a 5 week long campaign, the Conservative Party won a federal election and increased its number of seats in parliament to 143, up from 127 at the dissolution of the previous parliament; however, the actual popular vote among Canadians dropped slightly by 167,494 votes. As a result of the lowest voter turnout in Canadian electoral history, this represented only 22% of eligible Canadian voters, the lowest level of support of any winning party in Canadian history.[94] Meanwhile, the number of opposition Liberal MPs fell from 95 to 77 seats. It takes 155 MPs to form a majority government in Canada's 308 seat Parliament.
2008 Parliamentary dispute and prorogationMain article: 2008 Canadian parliamentary dispute
On December 4, 2008, Harper asked Governor General Michaëlle Jean to prorogue Parliament in order to avoid a vote of confidence scheduled for the following Monday, becoming the first Canadian PM ever to do so.[95][96] The request was granted by Jean, and the prorogation lasted until January 26, 2009. The opposition coalition dissolved shortly after, with the Conservatives winning a Liberal supported confidence vote on January 29, 2009.
2010 prorogationSee also: 2010 Canada anti-prorogation protests and Prorogation in Canada
On December 30, 2009, Harper announced that he would request the governor general prorogue parliament again, effective immediately on December 30, 2009, during the 2010 Winter Olympics and lasting until March 3, 2010. Harper stated that this was necessary for Canada's economic plan. Jean would grant the request. In an interview with CBC News, Prince Edward Island Liberal member of parliament Wayne Easter accused the Prime Minister of "shutting democracy down".[97][98] Tom Flanagan, Harper's University of Calgary mentor and former Chief of Staff, also questioned Harper's reasoning for prorogation, stating that "I think the government's talking points haven't been entirely credible" and that the government's explanation of proroguing was "skirting the real issue -- which is the harm the opposition parties are trying to do to the Canadian Forces" regarding the Canadian Afghan detainee issue.[99] The second prorogation in a year also received some international criticism as being undemocratic.[100] Demonstrations took place on January 23 in 64 Canadian cities and towns, and five cities in other countries.[101] A Facebook protest group attracted over 20,000 members.[102]
A poll released by Angus Reid on January 7, found that 53% of Canadians were opposed to the prorogation, while 19% supported it. 38 per cent of Canadians believed that Harper used the prorogation to curtail the Afghan detainee inquiry, while 23% agreed with Harper's explanation that the prorogation was necessary economically.[103]
2010 Senate appointmentsHarper filled five vacancies in the Senate of Canada with appointments of new Conservative senators, on January 29, 2010. The Senators filled vacancies in Quebec, Newfoundland and Labrador, and New Brunswick, as well as two vacancies in Ontario. The new senators were Pierre-Hugues Boisvenu, of Quebec, Bob Runciman, of Ontario, Vim Kochhar, of Ontario, Elizabeth Marshall of Newfoundland and Labrador and Rose-May Poirier, of New Brunswick.
This changed the party standings in the Senate, which had been dominated by Liberals, to 51 Conservatives, 49 Liberals, and five others.[104][105]
2011 Vote of non-confidenceHarper's Conservative government was defeated in a no-confidence vote on March 25, 2011, after being found in contempt of parliament, thus triggering a general election.[106] This was the first occurrence in Commonwealth history of a government in the Westminster parliamentary tradition losing the confidence of the House of Commons on the grounds of contempt of Parliament. The no-confidence motion was carried with a vote of 156 in favor of the motion, and 145 against.[107]
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