City wrong to cover councillors’ legal fees, court rules

February 25, 2010: Mayoral candidate Giorgio Mammoliti delivers a speech to kick off his campaign. Dave Chan for Globe and Mail.

Monday, July 19, 2010 8:54 PM

Kelly Grant

Councillor Doug Holyday has won a partial victory in his court battle against the city and two councillors who received taxpayer-funded reimbursals for nearly $100,000 in legal costs.

In a decision released Monday, Divisional Court ruled that city council acted outside its authority in 2008 when it voted to cover legal fees racked up by two councillors forced to undergo a compliance audit of their 2006 election expenses.

The three-judge panel concluded that since Giorgio Mammoliti (Ward 7 York West) and Adrian Heaps (Ward 35 Scarborough Southwest) incurred the costs as candidates, not councillors, they weren’t eligible for a taxpayer-funded reimbursement.

City solicitor Anna Kinastowski warned council that the courts would likely rule that way before the vote.

“They broke the law here,” Mr. Holyday said of city council. “The court’s now voided that bylaw. That means that council should retrieve the money. I’m going to make sure that they do. I’m going to put that right to council.”

The city paid $45,330.40 in legal fees, plus $19,427.30 in taxes in Mr. Heaps’s case. It forked over $36,598.87 in legal costs, $15,487.50 for the fees of an appraisal service and $22,320.63 in taxes in Mr. Mammoliti’s.

However, the court stopped short of ordering Mr. Mammoliti and Mr. Heaps to pay back the money themselves. The judges simply quashed the by-law authorizing the payments.

“We won,” Mr. Mammoliti’s lawyer, Peter Greene, said. “Every lawyer acting for the individuals told him [Mr. Holyday] he was going to lose … my client is going to seek legal costs against him personally.”

Mr. Heaps declined comment except to point out that he “wasn’t even privy to any of this” because he recused himself from the council votes on the matter. Mr. Mammoliti and Sandra Bussin, the third councillor named in Mr. Holyday’s action, recused themselves as well.

Mr. Holyday asked the court to overturn council’s decision to fund a libel lawsuit Ms. Bussin filed against the publisher of a local newsletter, Ward 32 News.

The court sided with city council and Ms. Bussin, but said that if the Beaches-East York councillor wins damages and legal costs she should pay back the city.

The city has reimbursed Ms. Bussin $7,700.96 for legal fees so far in this case, which is ongoing.

Mr. Holyday, the Etobicoke councillor who paid for the legal challenge out of his own pocket, is asking the court to cover his costs. The court gave all parties 30 days to submit written arguments on costs if they can’t come to a mutual settlement first.


4 thoughts on “City wrong to cover councillors’ legal fees, court rules

  1. Pingback: City wrong to cover councillors' legal fees, court rules « Vote … | Lawyers in Toronto

  2. votejohnrichardson Post author

    An editorial from the Toronto Star:–council-wrong-but-so-is-law

    Council wrong, but so is law

    July 21, 2010

    Toronto city council was repeatedly warned by its own lawyers that it had no authority to pay legal fees incurred by municipal politicians while running for office. But council nonetheless opted to cover such bills for two of its members, at a cost to taxpayers of almost $140,000. Now a panel of three Divisional Court judges has affirmed the in-house lawyers’ opinion and has ruled the offending bylaw invalid.

    City council should consider itself duly chastised. And Councillor Doug Holyday, who pursued this case in court at his own expense, deserves credit for taking a principled stand in defense of the rule of law.

    The court’s verdict fell short of requiring councillors Giorgio Mammoliti and Adrian Heaps to pay back the money they were given in 2008. That is an issue for council to consider when it next meets in late August.

    The money was given to the two councillors to offset legal fees resulting from citizen complaints that they broke election financing rules in the last municipal election. In both cases, the allegations were ruled groundless by an arm’s-length, three-person compliance audit committee. In Heaps’s case, the matter was then brought to court, where the audit committee’s finding was upheld.

    While city council behaved irresponsibly in covering the legal expenses for these politicians, there’s no denying that the current system leaves municipal office-holders vulnerable to frivolous or vexatious complaints about campaign spending.

    Some reforms have been undertaken since the 2006 municipal election that led to the complaints against Heaps and Mammoliti. Costs incurred navigating the compliance audit process are now considered a valid campaign expense and can be covered from a candidate’s election war chest rather than from his or her personal finances. And all municipalities are required to appoint an independent compliance audit committee, like Toronto’s, to weigh allegations of improper election spending.

    The rulings of these committees, however, may still be trumped by going to court, thereby ratcheting up legal costs. To narrow that option, the province should consider making a compliance audit committee’s ruling the last word in a dispute by taking away the right to appeal to the courts except on “natural justice” grounds.

    Politicians should not be using the city treasury to pay legal fees incurred running for election. But nor should they be exposed to daunting expenses in defending themselves from vexatious legal actions.

  3. Pingback: Council flouts court to pay councillors’ legal expenses | Vote John Richardson – Independent Judgment For Toronto Danforth – Ward 29!

  4. Pingback: HOLYDAY – and – CITY OF TORONTO, SANDRA BUSSIN, ADRIAN HEAPS and GIORGIO MAMMOLITI | Vote John Richardson – Independent Judgment For Toronto Danforth – Ward 29!

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