If It Walks Like a Duck

Trying to uncover what actually transpired between two suspect individuals is rarely easy and the outcome is even more rarely tidy. Counsel trying to unravel questionable dealings don’t count on finding the great smoking gun. It does happen, but rarely. Instead, they usually have to be content with uncovering a fabric of little lies, half truths and inconsistencies. It’s the way they point when they’re all put together that settles the issue.

How does one go about that? There are techniques that can be pretty effective. One of these is to steer clear of the principals at the outset. Leave them be while you pursue paper trails and get the evidence of knowledgeable third parties. There’ll usually be some credible individuals out on the periphery of any suspect deal – lawyers, bankers, managers, clerical staff – the sort of people involved in any legitimate deal. Individually they may not have the big picture but it can be astonishing how much they know about key parts of the scheme.

What you get, or hope to get, from this approach of working from the periphery toward the centre are building blocks of evidence. They may seem almost useless until you find something else with which they fit and, gradually, you may get to something that becomes recongizable. One makes sense of something else or corroborates part of the emerging picture.

Slowly what develops will become more focused and directed. That’s when you can tuck your documents, facts and analyses into your pocket and start talking to the principals.

Let’s say somebody claims to have been involved in a particular venture or project. If they’re telling the truth there ought to be documentary evidence to corroborate their claims. What if there’s not? Then it depends whether the venture looks suspicious. If it looks like a duck and waddles like a duck and quacks like a duck, the court is entitled to suspect that it is indeed a duck. Having come to that suspicion, the court is then properly entitled to call upon the people who claim it isn’t and never was a duck to come up with corroboration.

Enter Koop v. Smith, a 1915 decision of the Supreme Court of Canada. The case involved a fraudulent conveyance but is useful for its wider discussion of badges of fraud and shifting onus of proof:

“Suspicious circumstances coupled with the close relationship between the transferee and the debtor make a sufficient prima facie case of fraud. From that point, the burden of producing credible evidence substantiating the transaction is upon those who set it up. If substantial valuable consideration is truly given for a transfer of lands, there must be better evidence of it than the recitals in the deed and the land transfer tax affidavit.”

I think that this principle should apply to the Mulroney-Schreiber dealings. There was a close relationship going back to Mulroney’s leadership bid. There are plenty of suspicious circumstances to be found in the record of both men. Mulroney’s story has changed at least twice and his current position directly contradicts his sworn testimony many years ago. Schreiber too has changed his story when that has suited him.

I think there is an abundance of suspicious circumstances in this scandal to place a clear onus on Brian Mulroney to come up with “credible evidence substantiating the transaction” as he now alleges it. At the very least, Brian Mulroney has to come up with $300,000 worth of corroboration and that’s a lot of paper and a lot of witnesses. And if he somehow manages to do just that? Well then he needs to explain why he said something entirely different at the outset.

 

Mulroney’s Achilles Heel

It’s reported that the Commons Ethics Committee will have government lawyers open the questioning of Karlheinz Schreiber when and if he appears before them tomorrow.

If it was up to me, my first question would be to ask Schreiber if he would release his former lawyer, Robert Hladun, from his privilege restrictions concerning any communications between Hladun, Brian Mulroney and Mulroney’s lawyer, Gerard Tremblay, during October, 1999, pertaining to funds that passed from Schreiber to Mulroney or Frank Moores.

Why focus on this? The answer is contained in this account from the Fifth Estate of events said to have transpired on October 17, 1999:

October 17, 1999

“Mulroney contacts Schreiber’s lawyer Robert Hladun and asks him to ask Schreiber for a written statement indicating that at no time did Mulroney solicit or receive compensation from Karlheinz Schreiber.

Gerard Tremblay phones Robert Hladun and asks for a letter to keep on file from Schreiber, which is not to be disseminated, so that he can send a letter to the CBC which “would in his opinion shut down the airing of the fifth estate story on the “Airbus”—October 20th.

Mulroney contacts Hladun and tells him he has instructed Tremblay to send a letter to the fifth estate “indicating that if there was the slightest implication that Mr. Schreiber, Mr. Moores and Brian Mulroney were involved in any way then there would be terrible consequences.

He would issue the letter but first wanted an assurance or comfort in writing from Mr. Schreiber saying that he would confirm what he had publicly on many occasions, that at no time did Brian Mulroney solicit or receive of any kind from Schreiber. Mulroney called Hladun again that day, at which time Mulroney was told “I was no sure whether or not a letter would be forthcoming.”

These events, to my mind, could be the most troublesome for Mulroney because of what they say if they’re true and because they can be confirmed or denied by a person whose integrity is not questioned, Robert Hladun.

If Hladun corroborates this account it would put Mulroney in the spot of having to explain why he personally contacted Schreiber’s lawyer asking for a letter from Schreiber denying payments that even Mulroney himself now acknowledges he received. It would also make it vastly more difficult for Mulroney to lay on the blarney about what he said under oath in his lawsuit and why he forgot to declare this income for tax purposes until it was disclosed in the media. In other words, any guy who would try to pull this stunt has just kissed goodbye the benefit of the doubt.

If these events didn’t happen I think Hladun would be eager to set the record straight, if only to extricate himself from the controversy.

 

Mulroney’s Colossal Mistakes

According to Mulroney mouthpiece, Luc Lavoie, the former PM made a “colossal mistake” in accepting money from Karlheinz Schreiber. Funny he would look at it that way.

Mulroney’s problems aren’t with taking the cash-stuffed envelopes in coffee shops and hotel rooms. It’s what he did afterwards that amounted to colossal mistakes – plural.

It’s why he omitted any mention of getting the Schreiber schmiergelder money in his sworn evidence in his law suit. It’s why he seemingly waited until after Schreiber’s bank records came out to admit receiving the money and then running off to Revenue Canada to make an “anything but voluntary” disclosure. Those are colossal mistakes and there may be more, who knows?

Mulroney is furiously slicing and dicing what’s left of his reputation with utterly far-fetched explanations. Like why he didn’t disclose his business relationship in his testimony. Why? Because he wasn’t asked. He’s right, the government’s counsel didn’t put that specific question to him but Mulroney answered it anyway. He volunteered that he had no dealings with Schreiber other than to meet the guy for coffee a couple of times. That’s Mulroney’s statement. It’s on the record, given under oath. And it wasn’t remotely true.

Mulroney’s last-ditch defence is tantamount to saying that, since you didn’t ask the specific question, I was entitled to give an utterly false and misleading statement of my own and if you were deceived by that, hey, it’s your problem. Sorry, Brian, doesn’t work that way. You’re bound by your voluntary statements, regardless of the question asked, because you made them under oath. There’s no special law for Brian Mulroney. Just the same one the rest of us have to live by. Oh yeah, Brian, you’re a lawyer and nobody knows that better than someone from your profession.

Bear in mind that Mulroney hasn’t said these things himself. Luc Lavoie has said them, the boss’s mouthpiece. Lavoie has said a lot of things that weren’t exactly true but they were his statements, not Mulroney’s, and Lavoie is free to say pretty much anything he pleases. He’s free to test one tall tale after another in a hunt to find the one that will fly best for the boss. So far he’s not gotten anywhere but, hey, you have to give him full points for trying.

He had it all. A good life, every advantage, even some of his reputation back. But that wasn’t enough for Brian Mulroney. He had to come back into the public eye as Stephen Harper’s mentor and he brought all the old arrogance along with him. If he’d just laid low until after Schreiber was cooling his heels in a German jail cell, he might have dodged this bullet but life in the public eye was too enticing. Oh well.

Mulroney’s fortunes took another hit yesterday when Jean Chretien told an interviewer that he’d discussed the latest information with Allan Rock, the former justice minister who handled the Mulroney lawsuit settlement. Chretien got out his trusty mallet and wooden stake and said the two agreed that, had they known of the Schreiber payments, there wouldn’t have been a settlement, there wouldn’t have been an apology. Payback is a bitch, Brian.