Closing arguments began Wednesday at the inquiry looking into the business dealings between Brian Mulroney and Karlheinz Schreiber. (Jonathan Hayward, Kevin Frayer/Canadian Press)

Brian Mulroney's lawyer appealed to the head of the inquiry looking into his dealings with Karlheinz Schreiber not to judge the former prime minister too harshly, arguing in his final submissions Wednesday that Mulroney has already "paid dearly" for his association with the German-Canadian businessman.

"If my reputation were on trial, would I not like everybody to pause for one minute to ensure I am being judged objectively?" Guy Pratte said to commissioner Judge Jeffrey Oliphant.

Pratte argued it was unreasonable that Mulroney's "error in judgment" in private life after leaving office "will not be forgiven for what it is, not a crime, but a lapse of judgment, whose shadow should not eclipse a career."

"You’ll make findings you have to make, but I urge you to bring balance and perspective," he said. "It is not less an injustice to judge a man too harshly, than to judge an innocent man as guilty."

In documents submitted Tuesday, Schreiber's lawyers say common sense supports their contention that Mulroney agreed to lobby on behalf of Schreiber on June 23, 1993 — two days before resigning as prime minister.

Mulroney's side rejects that theory

Earlier in the day, Schreiber's lawyer, Richard Auger, told the commission that Mulroney's testimony lacked credibility, saying evidence presented by the former prime minister at the inquiry is "replete with internal inconsistencies and half-truths."

Auger reminded Oliphant that Mulroney had made no mention of his dealings with Schreiber during testimony he gave under oath in a Montreal courtroom in 1996.

"For the most part we are left with Mr. Mulroney's word on the key issues in this inquiry," Auger said.

"Mr. Mulroney’s story lacks everyday common sense based on everyday experience."

In contrast, Auger argued, Schreiber was "direct and truthful with this commission, even if at times it didn't make him look good."

Entering into an agreement while still in office to lobby the federal government on behalf of Schreiber would be an apparent violation of the ethics standards Mulroney implemented after taking power in 1984.

Both sides are expected to finish their oral arguments supporting their final written submissions by the end of Wednesday, the CBC's Rosemary Barton reported from inside the inquiry at Ottawa's Old City Hall.

In his final statement, Schreiber's lawyer said Mulroney didn't fully answer the one simple question put to him by the commission over why he accepted cash.

"What evidence Mr. Mulroney didn’t give to this commission is just as important as what evidence he did give," Auger said.

Timing disputed

Schreiber has testified he gave Mulroney $300,000 to lobby the Canadian government to build a light-armoured vehicle plant on behalf of Thyssen Industries. Schreiber says he struck the deal with Mulroney before the prime minister left office, although the money didn't change hands until later.

Mulroney told the commission he accepted $225,000 in cash from Schreiber to promote the sale of those vehicles internationally. He testified he didn't ask for cash and said there was nothing "sinister" in accepting it.

"And, as I say, my error was in not having insisted upon a cheque at the time," Mulroney said.

Mulroney admitted to taking the sum but not reporting the cash payments for income-tax purposes until six years after he started getting them.

Mulroney said he broke no laws or ethical guidelines and confined his lobbying to foreign political leaders in search of export markets for the Thyssen vehicles.

Commission head thanks media for 'accurate' reporting

Before he adjourned the proceedings to work on his report, Oliphant said the inquiry "brought to light in a public manner" how the federal government works.

"I gave an undertaking to preside over [the inquiry] in a way that was impartial and fair to all concerned," he said of his work. "I hope I have achieved that goal."

Oliphant also thanked the media for its "accurate" reporting of the commission's work, as well as being the "eyes and ears" of the public and letting the "light shine" on the proceedings.

"Sunlight is a good disinfectant," he said.

Doucet's lawyer defends client's memory-loss claims

Before Pratte spoke, the commission also heard from Robert Houston, lawyer for Mulroney's former senior adviser Fred Doucet, who struggled to recall key details during his testimony before Oliphant.

Houston said Doucet, who underwent major heart surgery in April 1988, has memory problems as a result of his medical condition. He told the commission that "medical literature supports the fact that individuals with serious heart conditions have cognitive impairment subsequent to serious heart conditions."

Oliphant asked Houston if this information had been tabled as evidence. Houston conceded it was not.

Houston also said that it is false Doucet had anything to with getting former defence minister Perrin Beatty's signature on an understanding in principle between the government and Thyssen Industries to build a light-armoured vehicle plant in Bear Head, N.S.

Schreiber has said that Doucet was to be paid $90,000 to ensure that Beatty sign the agreement, but Houston said there is no evidence his client had anything to do getting Beatty to sign the document.

Doucet testified at the inquiry that during his time in government he had "no memory of advocating to anyone on the [Bear Head] project."

Houston reiterated Doucet has no recollection of receiving a $90,000 payment from Schreiber, who Houston said "not only fabricates stories, he exaggerates."

The commission's own lawyers opted not to offer any final thoughts on the proceedings, which could be an indication they are confident Oliphant has heard enough to make up his own mind over whose story to believe.

The deadline for Oliphant's report to the federal government is Dec. 31. With files from Rosemary Barton