Ethics commissioner’s decision not to sanction MLA questioned

A CBC News investigation has found major problems with Alberta Ethics Commissioner Neil Wilkinson’s decision not to sanction Edmonton MLA Peter Sandhu.

Critics say court record doesn’t support conclusions

Edmonton Manning MLA Peter Sandhu has been cleared by Alberta's ethics commissioner following a CBC investigation involving unreported liabilities and improper lobbying. (CBC)

A CBC News investigation has found major problems with Alberta Ethics Commissioner Neil Wilkinson’s decision not to sanction Edmonton MLA Peter Sandhu.

“I think it was a very weak, and a very poor decision,” Mount Royal political scientist Duane Bratt said, adding later that Wilkinson’s decision not to sanction Sandhu, “says that you can be in violation but as long you go to the ethics commissioner as soon as it breaks publicly, and you say you’re sorry, you’re fine.”

Both Wilkinson and Sandhu declined interview requests. The lawyer for the ethics commissioner’s office, Brad Odsen, said Wilkinson’s ruling speaks for itself.

Ethics commissioner Neil Wilkinson decided not to sanction Peter Sandhu despite finding that the Edmonton MLA breached the Conflicts of Interest Act six times. (Office of the Ethics Commissioner of Alberta )

On May 14, CBC News reported Sandhu had not disclosed two court judgments against his company, and had also sworn a false affidavit in a civil court case. Within hours of the story appearing, Sandhu, who represents Edmonton-Manning, resigned from the Conservative caucus and continues to sit as an independent MLA.

Last month, Wilkinson released the results of an investigation by his office, which found Sandhu breached the province’s Conflicts of Interest act six times by failing to disclose lawsuits involving his homebuilding company, NewView Homes.

But Wilkinson decided not to sanction Sandhu for two main reasons. The first was that Sandhu had self-reported some of the undisclosed debts and had followed the commissioner’s advice to request an investigation. The second was that Wilkinson agreed with Sandhu’s explanation that he had not disclosed the debts because he considered them settled.

MLA did “right and honourable thing”

In his Oct. 17 report, Wilkinson said Sandhu and his lawyer met with him on May 13, and disclosed the two judgments. He said he advised Sandhu to allow him to investigate and Sandhu agreed, by letter, the next day.

Wilkinson said that by coming forward and allowing an investigation, Sandhu had done, “the right and honourable thing.”

But when Sandhu met with Wilkinson on May 13, CBC News had already requested an interview with Sandhu, which means he knew his failure to disclose his liabilities would soon be made public. Sandhu sent the letter to Wilkinson agreeing to the investigation on May 14, hours after CBC broadcast and published its story.

“It shouldn’t be a mitigating factor when somebody comes clean only because they have been caught,” Wildrose Leader Danielle Smith said. “It seems to me that we might not know about this if the story had not come out in the media.”

Wilkinson found a total of six undisclosed court actions dating back to when Sandhu was first elected in 2008. But he said Sandhu had relied on advice from his lawyer that all these legal matters were near settlement and he found Sandhu’s reliance on this advice was “a mitigating factor in assessing a sanction.”

The ethics commissioner’s investigation also found “court records indicate all of these matters settled shortly after Member Sandhu filed the required Annual Disclosures.

“This corroborates his evidence that he failed to disclose the actions because he considered them settled. Indeed, for the initial two actions prompting this investigation, evidence clearly shows settlement agreements had been reached but not yet finalized at the time of Annual Disclosure (May 1, 2012).”

Wilkinson said, “Member Sandhu’s evidence is that since these particular matters were, to his mind, essentially ‘settled,’ disclosure was not required as they were no longer ‘liabilities.’”

Debts unpaid year after disclosure

But court records show that although the initial two legal actions may have been technically settled, the liabilities clearly remained. The records show  creditors continued to legally pursue Sandhu’s company, NewView Homes, for payment of the debts for a year after he was supposed to have disclosed the liabilities.

Fancy Doors and Mouldings obtained a default judgment against NewView Homes on April 17, 2012 for more than $40,000. The court issued a garnishee summons on Aug. 21, 2012, which would allow Fancy Doors to seize whatever money it could from NewView to satisfy the debt.

Court record shows NewView finally paid the debt on May 10, 2013, four days before the CBC publicized the undisclosed liability and a full year after it was supposed to have been disclosed.

Dee Vee Electrical obtained a consent judgment with NewView on July 19, 2012 for more than $75,000. Dee Vee agreed to settle the lawsuit for more than $54,000 if Sandhu adhered to a payment schedule.

NewView made the first payment of $20,000 but bounced the second cheque for $17,000 and failed to make any further payment. Dee Vee sued Sandhu for the remaining debt on Oct. 12, 2012.

Court records show NewView finally paid the debt on June 4, 2013, more than a year after it was supposed to have been disclosed, and three weeks after CBC made the debt public.

But while the ethics commissioner chose not to sanction Sandhu for failing to disclose his liabilities, the Real Estate Council of Alberta (RECA) did.

In a Nov. 13 ruling, RECA sanctioned Sandhu, a licensed realtor,  for failing to disclose a judgment in his 2012 disclosure. It found Sandhu did not seek advice from RECA at the time of disclosure and it said Sandhu, a realtor since 1997, should have known he had to disclose the judgment. But RECA also found Sandhu’s self-disclosure of the judgment in 2013 was a mitigating factor.

The council fined Sandhu $1,500 and, in its ruling, said that if he does not pay within 30 days, it will take legal action to recover the debt.

Wilkinson not seeking reappointment

Wildrose Leader Danielle Smith said Wilkinson “either made an error, or he misstated the facts. No one can say that having a payment made a year after (the disclosure date) is shortly after.”

New Democrat MLA Rachel Notley said Wilkinson’s conclusion that all the matters were settled is “one that I don’t think any reasonable person would agree with.

“One of the critical issues that the decision rests upon is this question of whether or not (the debts were) effectively a non-issue at the time that (Sandhu) filed (his disclosure).

“But clearly there was a year between the time he filed his disclosure and the time that the matters were resolved, although not settled because quite frankly they had to be enforced through the mechanisms of the court,” she said.

Notley believes the ruling by Wilkinson shows his office “is more concerned with representing the interests of politicians to the public rather than representing the interests of the public to the politicians.”

Sandhu was also the subject of a second investigation by Wilkinson, again following a CBC News investigation. It revealed officials within Service Alberta believed Sandhu had improperly lobbied to have the provincial Builders’ Lien Act changed to make it more difficult to register liens. Wilkinson also cleared Sandhu of any wrongdoing in that case.

Wilkinson’s contract expired last week. He is not seeking reappointment but is staying on for six months until a new commissioner is found.

Smith said she hopes the next commissioner, “is actually going to exercise the jurisdiction of the office and impose penalties.”.

Since 1993, the ethics commissioner’s office has found 10 MLAs breached the Conflicts of Interest act - eight Conservatives, two Liberals - but has never issued a sanction.

Alberta’s provincial Conflicts of Interest Act does not allow an appeal of the ethics commissioner’s rulings.


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