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2012 05 07 Notice of Application

2012 05 07 Notice of Application

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12/01/2012

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No.

S-117635

Auditor General of British Columbia PETITIONER AND: Her Majesty the Queen in Right of the Province of British Columbia as represented by the Ministry of Attorney General, Sandra Harper, Robert Jones, Udhe Singh Basi, Bobby Singh Virk, John Doe and Jane Doe RESPONDENTS NOTICE OF APPLICATION Name of applicant: To: John van Dongen

The Petitioner, the Auditor General of British Columbia, and to the Petitioner's Solicitors Her Majesty the Queen in Right of the Province represented by the Ministry of the Attorney General Sandra Harper Robert Jones Udhe Singh Basi and to his Solicitor Bobby Singh Virk and to his Solicitor Judicial Officers and to their Solicitor Michael Frey, Amicus Curiae of British Columbia as

And To:

And To: And To: And To: And To: And To: And To:

TAKE NOTICE that an application will be made by the applicant to the Hon. Chief Justice at the courthouse at 800 Smithe Street, in the City of Vancouver, in the Province of British Columbia, on Friday, June 1,2012 at 9:00 am for the order set out in Part 1 below. Part 1: ORDER SOUGHT

1. That the applicant John van Dongen be granted intervenor status in this proceeding with permission to adduce evidence and to make submissions regarding the scope of the authority conferred on the Petitioner by the Auditor General Act, SBC 2003, c. 2 (the "Act").

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Part 2:

FACTUAL BASIS

1. The applicant is the Member of the Legislative Assembly of British Columbia ("MLA") for the riding of Abbotsford-South. Since he first became an MLA in 1995, he has served in Cabinet as the Minister of Agriculture, Food and Fisheries (2001-2005), Minister of State for Intergovernmental Relations (2005-2008), and as Solicitor General and Minister of Public Safety (2008-2009). Affidavit #1 of John van Dongen [the "Affidavit"], paras. 1-4. 2. Mr. van Dongen has also served on various committees of the Legislature including, inter alia, Agriculture and Fisheries (July, 1998 - March, 2001), Finance and Government Services (September, 2009 - February, 2011), and Public Accounts (May 26,2011 - March 29,2012). Affidavit, paras. 5-6. 3. This proceeding concerns public law issues which have important implications functioning of democracy in British Columbia. for the

4. Our Westminster-style Legislature, which is based on the principle of "responsible government", demands fiscal transparency and accountability of the executive branch of government. The Auditor General, who is an officer of the Legislature and therefore independent of the executive branch, plays a crucial role in ensuring fiscal accountability by conducting audits - including performance audits - and commenting on the economy and efficiency of how tax payer dollars are spent and managed. 5. The Auditor General must be able to provide elected representatives with complete and objective information so they are able to assess the extent to which government has been fiscally responsible. If the Auditor General were not able to conduct a thorough performance audit of the expenditure and receipt of public money, and to report on that audit to the Legislature, the efficacy and utility of his office would be severely impaired to the detriment of our democracy. The electorate must have trust in the institutions which are there to serve them if our democracy is to function properly. "[IJfthe mechanism in question is one, which

acts as a safeguard against the tyranny of power exercised by a government and is supposed to be a tool of parliament and ultimately the 'people', is unable to remain effective, questions of institutional functionality and democratic robustness become very serious questions." Sciarra, R., The Office of the Auditor General in Ontario, Canadian Parliamentary Review,
Winter 2005-06, at p. 22. 6. In one sense, the resolution of the public law issues raised by this proceeding will tum on the judicial determination of the true intent and correct interpretation and application of the Auditor General Act, including sections 2, 9, 10, 11, 9, 13, 16, and 17. The applicant respectfully seeks an opportunity to make submissions with respect to these questions, including the application of established principles of statutory interpretation which the applicant will submit are particularly relevant. 7. This extraordinary lawsuit by the Auditor General obviously has its origins unprecedented decision of the government to release Basi and Virk from obligation under Special Indemnities to repay legal bills incurred by them Basi, Virk and Basi, SCBC 23299, Vancouver Registry. Although the in the apparently their contractual in relation to R v outcome of this

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proceeding will therefore be crucial to the ability of the Legislature to receive a complete performance audit report from the Auditor General concerning the Basi-Virk Special Indemnities, it may also have significant implications for the quality of fiscal transparency and accountability available to legislators generally by virtue of the Auditor General Act. 8. In summary, it is clear that the issues in this case legitimately engage the interests of the applicant in his capacity as a legislator who depends on the Auditor General to provide accurate and useful information to him (and other members of the Legislature) regarding the fiscal responsibility of government. 9. The applicant possesses a particular point of view or perspective which will assist the Court in the resolution of the issues before it. He can make a significant contribution and play a vital role by virtue of his extensive experience as a member of the Legislative Assembly (17 years) and his past service as a Minister of the Crown. He is sensitive to the practical implications or repercussions of this Court's decision which may otherwise not be fully and comprehensively presented to the Court. In addition, he has a substantial, legitimate and vital interest as a legislator in the outcome of this proceeding, which is different from the interest of the other parties currently before the Court. Affidavit, paras. 7-11, 12-28,37,38. 10. The public law issues in this case focus primarily on and involve, inter alia, determining the proper interpretation of sections 2, 9, 10, 11,9, 13, 16, and 17 of the Auditor General Act. 11. The applicant seeks the opportunity to make principled submissions, orally and in writing, and to adduce evidence relevant to the scope of the Auditor General's authority to access records and information and his corresponding capacity to report to the Legislative Assembly pursuant to the Auditor General Act, including: a. Whether sections 13, 16 and 17 entitle the Auditor General to be given unfettered access to records and information, despite any confidentiality agreement or claim of privilege, including complete indemnity files for Special Indemnities, which includes the particular indemnity agreements complete with schedules (i.e., legal representation agreements and fees and billing schedules), copies of invoices from private legal counsel, outcomes of each matter that was covered by each particular indemnity, briefing notes/emails to support each particular decision, and the request from the Ministry of Attorney General for prior written approval of Special Indemnities as required by section 72 of the Financial Administration Act and the Guarantees and Indemnities Regulation, and any form of settlement agreement or release relating to the Special Indemnities (collectively the "Special Indemnities RecordslInformation"); b. Whether sections 13, 16 and 17 entitle the Auditor General to be given unfettered access to all documents and information, despite any claim of confidentiality or privilege, related to the development of past or future policies for Special Indemnities, including the right to take copies and create a record of other information for the audit file;

-4c. Whether the Auditor General is authorized to report to the Legislative Assembly pursuant to section 11 (annual report) or section 12 (other reports), despite any confidentiality agreement or claim of privilege, stating whether the administration of the Special Indemnities has complied fully with the Financial Administration Act, the Guarantees and Indemnities Regulation, the Forgiveness of Debts and Obligations Regulation, or other applicable law, and where there has been non-compliance, to provide explanatory particulars; d. Whether the Auditor General is authorized to include in reports to the Legislative Assembly pursuant to section 11 or section 12, despite any claim of confidentiality or privilege, his recommendations concerning new or revised statutory provisions regarding Special Indemnities which may be desirable or necessary. 12. By way of illustration, with respect to issue (d), the applicant intends to submit that the Auditor General should be entitled to conduct a complete performance audit which enables him to advise authoritatively whether changes to the law are desirable or required:
I.

to deter or prevent non-compliance with the Financial Administration Act, the Guarantees and Indemnities Regulation, the Forgiveness of Debts and Obligations Regulation or other applicable law; to restrict or clarify the subject matter in respect of which Special Indemnities may be authorized; to clarify, modify or impose monetary limits on Special Indemnities; to facilitate greater transparency and accountability for the administration of Special Indemnities; and/or

11.

111. IV.

v. to ensure that the administration of Special Indemnities is carried out with due regard for the public interest and the integrity of the judicial system. 13. The applicant generally intends to argue that the questions identified in paragraph 11 above should be answered in the affirmative and that the Court should adopt an interpretation of the Auditor General Act which ensures the maximum transparency and accountability of government in respect of public spending, including spending on Special Indemnities. 14. In this context, the applicant wishes to make submissions concerning: a. The proper interpretation and application of the Auditor General Act; b. The impact, if any, of solicitor-client or litigation privilege on the authority of the Auditor General to access records and information and report to the Legislature; and c. The impact, if any, of contractual confidentiality provisions on the authority of the Auditor General to access records and information and report to the Legislature.

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15. The applicant developed a strong and distinct interest in promoting accountability and transparency for government spending over many years in his role as an MLA and Minister of the Crown and well before October 18, 2010 when public controversy erupted over the government's legal fees indemnities. When he learned of the government waiver, the applicant (who was then the Government Caucus Whip) immediately sought answers from the government and took steps that resulted in Premier Campbell's short-lived agreement to have the Deputy Attorney General and the Deputy Minister of Finance provide a full briefing to, and answer questions from, members of the government caucus. After the briefing was twice cancelled, the applicant embarked on a mission, which continues to this date, to exercise scrutiny and demand accountability of the executive for the waiver transaction. Affidavit, paras. 29-33. 16. The applicant, in the course of his activities as an MLA, followed closely the public controversy concerning the Basi-Virk legal fees indemnity waiver and developed significant concern that it had and would continue to erode public confidence in the integrity of the government. The applicant was concerned, inter alia, that members of the public and the media were characterizing the transaction as a "bribe" or payment for the guilty pleas entered by Basi and Virk on October 18,2010. This criticism of the transaction, the applicant feared, might also erode public confidence in the administration of justice. Affidavit, paras. 29 (d), (e), (t), (g), 34, 35, 47-57. 17. The applicant was deeply troubled by the government's decision to ignore calls for a public inquiry into the Basi-Virk legal fees indemnity waiver. As did members of the media and the public, he considers an investigation by the Auditor General pursuant to the Auditor General Act to be a potential alternative mechanism to expose the waiver transaction to public scrutiny and hold the government accountable to the Legislature. Affidavit, paras. 38, 50, 78-80 18. The applicant has experience dealing as an MLA with reports of the Auditor General. He is well-positioned to speak to the potential adverse consequences of a narrow interpretation of the Auditor General Act, particularly one which prevents or deters the Auditor General from seeking information or records because of claims of confidentiality or privilege. On the other hand, he has given careful thought to how an expansive interpretation, which over-rides claims of confidentiality or privilege, would produce a more workable and practical result which enhances transparency and accountability. Affidavit, paras. 33(g), 38-40,44-46. 19. The applicant is in an especially advantageous and perhaps even unique position to illuminate aspects or facets of this proceeding which ought to be considered by the court in reaching its decision which might not, but for the applicant's intervention, receive any or adequate attention or prominence. 20. The particular circumstances of the Basi-Virk indemnities and the government's decision to waive repayment of the indemnities, and the public interest issues they have spawned, provide a useful focus for arguments favouring the importance of a broad interpretation of the Auditor General Act to accommodate the democratic interest in transparency and accountability for the expenditure of public funds. The applicant, however, is also able to

- 6speak to the specific public importance of ensuring complete scrutiny of public spending with respect to Special Indemnities. 21. With respect to the impact of a narrow interpretation of the Auditor General's powers, the applicant is also concerned, inter alia, about potential implications for the judicial system. In the case of the government's waiver of the obligation to repay the Basi-Virk legal fee indemnities, the applicant questions whether the trial judge was apprised of the waiver or any information relating to the Special Indemnities when the accused entered their guilty pleas and were sentenced on the morning of October 18, 20 I 0 following submissions by counsel focussed on an agreed statement of facts. The Criminal Code provides in section 606 (1.1): 606 (1.1) Conditions for accepting a guilty plea - A court may accept a plea of guilty only if it is satisfied that the accused (a) is making the plea voluntarily: and (b) understands (i) that the plea is an admission of the essential elements of the offence, (ii) the nature and consequences of the plea, and (iii) that the court is not bound by any agreement made between the accused and the prosecutor. The applicant is concerned that a Court may not be able to perform the function mandated by section 606 unless the Court is given complete disclosure of all circumstances regarding a legal fees indemnity waiver which is temporally related to a guilty plea such as occurred in the instant case. Affidavit, para. 80 (k), (1), (m). 22. The applicant is not seeking to raise new issues but rather to provide insight and analysis on the particular questions which the parties and the Amicus Curaie have identified in their filings with this court. The applicant does not intend to mirror submissions made by the existing parties but will endeavour to make a distinct and unique contribution. 23. The applicant would be the only party to this proceeding whose representation by counsel is not funded by the taxpayer. 24. It is respectfully submitted that there is no prejudice to any party involved m these proceedings if intervenor status is granted to the applicant.

Part 3:

LEGAL BASIS

1. The Court has-inherent jurisdiction to grant intervenor status to the applicant and to fix the terms of his intervention. International Forest Products Ltd v. Kern, 2000 BCSC 1087, per Pitfield J. at para. 20; Canadian Labour Congress v Bhindi et al (1985), 61 B.C.L.R. 85 (C.A.). 2. In Squamish (District) v. Great Pacific Pumice Inc., 2001 BCSC 406, appal J. (as he then was) stated at para. 13: 13. It is safe to say that courts have generally taken a liberal position in permitting applicants to intervene. The reason is that often intervenors are able, in the public interest, to bring relevant issues and perspectives to the proceedings. 3. Intervention is more likely to be permitted in proceedings concerned with issues of public law rather than private law. International Forest Products Ltd v. Kern, supra, per Pitfield J.

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at para. 20, citing MacMillan Bloedel Ltd v Mullin et al (1985), 66 B.C.L.R. 207 (C.A.) at page 210 and Guadagni v B.C (WCB. orB.C) (1988), 30 B.C.L.R. (2d) 259 (C.A.) at 263. 4. Intervenor status may be granted where the issues before the court are public law issues which have a dimension that legitimately engages the interests of the applicant and those he represents and the applicant possesses a particular point of view or perspective which may assist the Court in the resolution of the issues. KwicksutaineuklAh-Kwa-Mish First Nation v. British Columbia (Minister orAgriculture and Lands), 2011 BCCA 294, per Hinkson J.A at para 19; International Forest Products Ltd. v. Kern, supra at paras. 19 and 20; MacMillan Bloedel Ltd. v. Mullin et ai, supra per Esson J.A. (as he then was) at paras. 7 and 8; Friedmann v. MacGarvie, 2012 BCCA 109, per Bennett J.A. at para. 27. 5. Paul R. Muldoon, Law of Intervention, Status and Practice, Canada Law Books, states at pp. 7-8: Rather than seeking the determination of private rights, a public law action concerns issues of public policy (such as constitutional challenges or grievances with respect to the operation of statutory or administrative policies). ... Rather than deciding specific "adjudicative" facts, such as questions of pure fact, it focuses on "legislative" facts, such as the intent or proper interpretation of a statute. Rather than dealing with compensatory or remedial relief concerning the immediate parties, public law litigation isforward looking,fashioned on "flexible and broadly remedial lines, often [having] important consequences for many persons including absentees. When the notion of public interest litigation is recognized, the concept of intervention takes on a slightly more expanded and, indeed, vital role. Because public law actions do affect those beyond the immediate parties to the action, intervention plays a crucial role in providing a means for individuals, groups, associations, corporate entities and the like, to have their positions heard andfor the courts to have as complete andfull a record on the matter as possible. "Public interest intervention" can be described as intervention by strangers seeking to have some point of view heard, to bring to light how the decision will impact on the public, or some segment of thepublic, or to reveal the consequences and implications of the decision. And at pp. 64-65: These constituencies can be diverse - professional associations, private and public interest groups, ratepayer groups, and even individuals sincerely concerned with the operation of public policy or the development of legal doctrine. Not only is the nature of intervenors varied and diverse, but so is the range of proceedings where applications for intervention may occur. They may occur in an obvious case of public importance such as a constitutional challenge to a particular law or ajudicial review of an administrative practice. At page 72:

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...there is no absolute requirement that the proposed intervenor have an organizational backing ....
6. Intervenor status may be granted where the applicant can provide the Court with a helpful sense of the broader implications that its decision on this issue may have. Western Industrial Clay Products Ltd. v. Keeping, [1997] B.C.J. No. 42, 86 B.C.A.C. 50 (C.A.), per Newbury J.A. at para. 6. 6 ... the Court in this case will be concerned not with a private contract between parties but with the construction of Crown grants at a certain period of time. As Mr. Zivot notes, the determination may affect grantees of other materials and may affect other parties who have grants of land in the Railway Belt. It may very well be helpful to this Court to have an idea of the broader implications of any decision it may make. By the same token, I am not persuaded that the granting of intervenor status to the Mining Association will unduly expand or complicate the appeal. As I understand it, the Association does not propose to raise new issues or to "hijack" the appeal as it has beenframed by the parties. 7. The applicant does not have a disqualifying private interest in the outcome of the Petition. International Forest Products Ltd. v. Kern, supra at paras 19 and 20. 8. Intervenors are not precluded from initiating issues that are clearly relevant and not new in the sense that they relate to the primary issues in the proceeding. Squamish (District) v. Great Pacific Pumice Inc., supra at paras. 15 -17. 9. See In Reference Re Sections 32 and 34 of the Workers Compensation Act, [1989] 2 S.C.R. 335, [1989] S.C.J. No. 113, where a private litigant (someone not representing a group or organization) was granted intervenor status in the Supreme Court of Canada. Per Sopinka J. at para 12:

Useful and Different Submissions 12. This criteria is easily satisfied by an applicant who has a history of involvement in the issue giving the applicant an expertise which can shed fresh light of provide new information on the matter. As stated by Brian Crane in Practice and Advocacy in the Supreme Court of British Columbia Continuing Legal Education Seminar, 1983), at p. 1.1.05: "an intervention is welcomed if the intervener will provide the Court with fresh information or a fresh perspective on an important constitutional or public issue. "
10. This proceeding by the Auditor General engages fundamental issues relating to the nature of our democratic system of "responsible" governance.

Part 4:

MATERIAL TO BE RELIED ON

1. Affidavit #1 of John van Dongen made April 22, 2012.

-92. The pleadings and proceedings herein. 3. Such other material as counsel may advise. The applicant estimates that the application will take 30 to 60 minutes. [Check the correct box. ]

D
[2]

This matter is within the jurisdiction of a master. This matter is not within the jurisdiction of a master.

TO THE PERSONS RECEIVING THIS NOTICE OF APPLICATION: If you wish to respond to the application, you must, within 5 business days after service of this notice of application or, if this application is brought under Rule 9-7, within 8 business days after service of this notice of application, (a) file an application response in Form 33, (b) file the original of every affidavit, and of every other document, that (i) you intend to refer to at the hearing of this application, and (ii) has not already been filed in the proceeding, and (c) serve on the applicant 2 copies of the following, and on every other party of record one copy of the following: (i) a copy of the filed application response; (ii) a copy of each of the filed affidavits and other documents that you intend to refer to at the hearing of this application and that has not already been served on that person; (iii) if this application is brought under Rule 9-7, any notice that you are required to give under Rule 9-7(9).

Date: 7 May 2012

[2] lawyer for applicant
Roger D. McConchie (McConchie Law Corporation Solicitor for John van Dongen

To be completed by the court only: Order made [] in the terms requested in paragraphs notice of application

of Part I of this

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[]

with the following variations and additional terms:

Date: Signature of[ ] Judge[ ] Master

APPENDIX [The following information is provided for data collection purposes only and is of no legal effect.] TIDS APPLICATION INVOLVES THE FOLLOWING:

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discovery: comply with demand for documents discovery: production of additional documents other matters concerning document discovery extend oral discovery other matter concerning oral discovery amend pleadings add/change parties summary judgment summary trial service mediation adjournments proceedings at trial case plan orders: amend case plan orders: other experts.

D

D D D D D D

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