Tuesday, March 01, 2011

Conservatives lose the "in and out" case at Federal Court of Appeal

A very bad day for the law and order Harper Conservatives no matter what they're trying to sell us. Their 2006 election play where they used the in and out tactic to move moneys in and out of local ridings in order to finance a big national advertising push at the end of that campaign, to the tune of $1.3 million in excess of their rival parties, has finally been judged to be wrong. In addition to that major setback, their top campaign officials are now facing fines and possible jail time as a result of the Elections Act charges levelled by the Director of Public Prosecutions last week. The Conservatives are vowing to carry on appealing, as corporate behemoths verily do, but the Supreme Court of Canada might not hear an appeal from the Federal Court of Appeal decision issued yesterday. We shall see.

From some reporting on this that conveys the essence of today's appeal judgment and some context:
...the Conservatives have repeatedly claimed they were exonerated by a favourable ruling in a related case handed down by the Federal Court’s trial division last year.

But on Tuesday, the Federal Court of Appeal reversed that ruling, saying that Chief Electoral Officer Marc Mayrand was acting within his rights when he disallowed advertising expenses claimed by the Conservative candidates in the 2006 campaign.

Elections Canada contends that the Tories attempted to skate around the $18.3-million spending limit by transferring the costs of $1.3 million in advertising to its candidates, who were covered by their own, separate spending limits.

The party used a series of wire transfers into and out of the candidates’ bank accounts to pay for the TV and radio ads.

The decision of the three-member appeal court could be appealed the Supreme Court.
"...the appeals court said Mayrand was acting reasonably when he refused to allow the 67 candidates — represented by two test cases before the court — to claim the advertising costs on their own books.

Elections Canada heralded the ruling Tuesday, saying it recognized the spending limits ensure fairness and transparency in the political system.

“The decision of the Federal Court of Appeal confirms Elections Canada’s interpretation and application of the relevant provisions of the Canada Election Act, including the prohibition against the transfer of expenses from a party to a candidate,” said spokesman John Enright.

“Moreover, the decision preserves the integrity of the political financing regime, which ensures fairness in the electoral system.”
On the question of the jeopardy faced by the 10 Conservatives who, under the trial level ruling, were deemed to have overspent - including Cannon, Verner, Paradis, Bernier and others - the Court of Appeal seems to have given them a temporary reprieve, leaving it to the Chief Electoral Officer to hear from them on refilings, essentially. From paragraph 130 of the judgment:
As the underlying application for judicial review will be dismissed, the issues arising from the audit of the Respondents’ returns, and more particularly the decision not to certify their RMB expenses, remains before the CEOC because he has not yet required the Respondents to file corrected electoral campaign returns (as the CEOC may require under subsection 457(2) of the Act). It remains open, therefore, for the Respondent Callaghan to provide further information or submissions to the CEOC about the reasonableness of the amount he reported for his candidate’s participation in the RMB. We agree, however, with the Judge and the CEOC that the amount reported for a candidate’s share of a pooled advertising expense cannot be arbitrary, or based solely upon the available room under each candidate’s spending limit, but must be reasonably related to the value of the benefits received.
That process, when it happens, may yet leave those Conservatives in jeopardy of having overspent in 2006. But given that the Conservatives are vowing to appeal this decision, that reckoning may also be temporarily delayed.

So, a bad day for Conservatives. This will not look good on them, no matter what they say, should we have an elections campaign.

It is a good day, on the other hand, for democracy, those political parties who play by the rules and the institutions, here Elections Canada, who vigilantly watch over it all for us.