Thoughts and Opinions On Today's Important Issues

Monday, January 04, 2010

Explanations Required

Here are several items of interest.

I am having trouble figuring these things out so perhaps one of my readers can help explain to me what is happening.


WOW, that audit on the 400 building really does require a Public Inquiry. Councillor Halberstadt said so but never acted on it as a Member of the Audit Committee or as a Councillor. At first:
  • "Only in Windsor can politicians who engage in activity that blatantly violate Common Law and the bylaws that govern the City of Windsor be hailed as heroes...

    Rather than defending his conduct, ex Councillor Carlesimo should be thankful that the audit committee did not recommend to Council a full-blown Public Inquiry. Then he and the other members of the selection committee would have been put under oath and asked what conversations and associations they might have had with local contractor Oscar during the time this sordid mess was unraveling."

Then he changed his mind:

  • "There is a smattering of calls for a public inquiry to expand on the 400 Building Audit, including one in the comments section beneath my Dec. 23 blog – Pistol Pete Audit Conclusion Scary.

    This reader is demanding to know why the audit committee, of which I am a member, has not recommended a full-blown public inquiry into the conduct of Councillors and bureaucrats who broke the laws of RFP tendering by naming a non-compliant bidder to construct the building that started out as a $24.9 million project and finished up at $32.5 million.

    There are a number of reasons why, but the two main ones are these:

    1. KPMG forensic auditors and Miller Thomson lawyer Andrew Roman concluded that they could not find any evidence of criminal wrongdoing during an extensive investigation of the bungled RFP process, including interviews with all of the key players.

    2. A public inquiry would cost taxpayers a fortune. Once the Province of Ontario grants a city’s request for a Commission of Inquiry, the city loses control of all costs and timing. Here are some of the recent examples as provided by Miller Thomson:

Oh Alan, give me a break!

KPMG and Miller Thomson were hired to oversee Angela Berry not to do an investigation into criminal activity. What else could they say? They would be sued otherwise.

As for costs, the other inquiries mentioned were huge ones like MFP in Toronto, Walkerton and the Dudley George one, not a focused one like the 400 Building would be. If wrong-doings were found, a nice lawsuit would recover oodles of money for Windsor.

Why would Alan change his mind? Do you think it had anything to do with Al Nelman who asked on Eh-Channel News how Alan could be a member of the 400 Building Steering Committee and an Audit Committee member looking into that project.

Or maybe it is the "old boy's network" in operation where you don't go after past politicians since it can happen to you when you leave office. That happened during the early days of Edgar's first term as Mayor at City Hall concerning a past matter when I first heard that proposition expressed.


I found an interesting Minute on the City's website and you will note that there is no discussion of what the "general nature thereof" is of the "interest."

So I sent this note to Councillor Valentinis:

  • "----- Original Message -----
    From: Ed Arditti
    Sent: Monday, December 28, 2009 6:31 PM
    Subject: Pecuniary interest

    I would appreciate if you would let me know "the general nature therof" of your declaration since it is not set out in the Minutes.

    Ed Arditti

    October 7, 2002


    That the Commissioner of Corporate Services and Treasurer BE DIRECTED to issue to Vindella Enterprises Inc a purchase order not to exceed $835,000 plus G.S.T. charged to 07 8950 5410 std std 717031 to complete the following:

    1. Demolish the former Police Headquarters including environmental remediation and documentation of remediation and demolition

    2. Construct a vault to protect the existing electrical feed on the former Police Headquarters Site as identified in Vindella’s proposal

    3. Construct a municipal parking lot satisfactory to the Commissioner of Traffic Engineering complete with lighting, landscaping, and electrical feed for ticket dispenser and line markings as identified in Vindella’s proposal.

    And that the Director of Facility Management BE DIRECTED to provide standby generators as a precaution during demolition of the former Police Headquarters.

    And that the project team BE DIRECTED to negotiate a Memorandum of Understanding not to exceed the guaranteed price of their proposal net of $815,000 plus G.S.T. designated for the building demolition, vault protection and parking lot construction.


    Councillor Valentinis discloses an interest in this matter and abstains from voting."

I received an auto-response saying the Councillor was away until January 4 but I also received this:

  • "Your message

    To: Valentinis, Fulvio
    Subject: Pecuniary interest
    Sent: Mon, 28 Dec 2009 18:31:57 -0500

    was read on Wed, 30 Dec 2009 00:54:52 -0500"

So the Councillor has read my note but chose not to respond at that time. If I get an answer, I'll let you know.


I wonder why Edgar did not declare a pecuniary interest in this case since his good buddy at the Duty Free was his campaign manager while he did declare such an interest in other cases:

I wonder if downtown businesses get tax reductions if they have tourist promotions to help them out with the decrease in tourist numbers.


I wanted to teach a course in law at the University of Windsor law school when I first moved to the City and but it just did not work out.

Part of the fun of teaching such a course would be in making up the exam questions. My style would have been to take a “real” fact situation in the City for example and then twist and turn it into a hypothetical case and ask the students to give an answer. It makes it so much more fun for the students even though they are under a tremendous amount of stress writing the paper.

Let me explain what I mean. Here is a sample question:

  • "Assume that you are the new lawyer for Chuck Mady. You have just read this case comment when you are called by Mr. Mady with a situation that he is involved in. What would your advice to him be:

    "A client has every right to be confident that the solicitor retained will not subsequently take an adversarial position against the client with respect to the same subject-matter that he was retained on. That fiduciary duty… is not terminated when the services rendered have been completed."

    The Mayor of the City of Windsor when he was a Councillor worked for the law firm that represented Mr. Mady when he bid on the 400 Building project. Mr. Mady‘s bid for that job was rejected and another contractor was hired to do the work.

    When the matter was brought in front of Council, the Mayor declared a pecuniary interest by saying:

    “Councillor Francis declares a conflict on items 4 and 5 since his employer represents the interests of Mady Development Corporation. "

    Several years later, but before the expiration of any Limitations Period for suing the City on the Project, the Mayor, even though he was not a member of the Audit Committee, received and read a Draft Audit Report concerning the shocking revelations about possible breaches of the law and the City’s Purchasing Bylaw respecting how this project was managed.

    In fact, a good argument could be made, based on the Report, that Mady’s bid was the lowest bid by far and that he should have been awarded the contract for the project.

    The Committee was clearly aware of the consequences of releasing their Audit Report before the expiration of the Limitations Period. A strong argument could be made that the Committee decided not to release the Report until after the expiration of the Limitations Period for fear that the City could be sued for millions of dollars and made up excuses not to release the Report until after such time. They were acting they thought in the best interests of the City and its taxpayers.

    At no time, did the Mayor contact his old law firm or Mr. Mady to let him know about what the Draft Audit Report stated and that Mady had the possibility of suing the City for substantial damages.

    Considering that the Mayor read the Report, what advice would you give your new client, assuming that the Limitations Period has expired for breach of contract only. Should action be taken against any or all of the following and if so, for what reason:

     The Mayor
     The Law Firm
     The City
     The Audit Committee
     The individual Audit Committee Members

    In framing your answer, consider and answer the following questions:

     Even though he no longer worked for the law firm, did the Mayor owe a duty to the law firm or to Mr. Mady in the circumstances of this case?
     If so, what was that duty? If not, why not?
     Was a duty owed to the City by the Mayor in these circumstances?
     If so, what was that duty? If no duty was owed, why not?
     Are those respective duties in conflict?
     If so, how could the Mayor have handled this situation differently?
     Is it a defence to any action to argue that the City representatives were acting in the best interest of taxpayers and that, in any event, there was no duty to ever release the Report?

I wish I knew what the answer was but it sure would make for some interesting responses I would bet.