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The case for—and problem with—remediation deals like the one SNC-Lavalin wants

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The furor over deferred prosecutions and the SNC-Lavalin case has drawn attention to a new law most Canadians had never before heard of—one that aims to serve a greater good by encouraging companies to come clean about wrongdoing, while sparing enormous costs in the form of lost jobs, devalued pensions and expensive court proceedings.

But in doing so, the case has put a spotlight on the sensitive position of the attorney general when so-called “remediation agreements” come into play, as he or she must walk a fine line between preserving his or her independence from political considerations while remaining accountable to Parliament.

This is an inherent tension in the AG’s role. But it’s seldom been more apparent than in recent days, and points to an urgent need for cabinet-created guidelines to keep deferred prosecution cases like the SNC-Lavalin affair from turning into political crises.

The new provision, Section 715.32 (1) of the Criminal Code, states that the prosecutor may enter into negotiations for a remediation agreement with an organization alleged to have committed an offence if  “the prosecutor is of the opinion that negotiating the agreement is in the public interest” and “the Attorney General has consented to the negotiation of the agreement.” This section puts the attorney general at the vortex of every case where an organization seeks a deferred prosecution agreement.

RELATED: For a commission of inquiry into SNC-Lavalin and the Prime Minister’s Office

The provisions governing remediation agreements are complex, and structure both the prosecutor’s and AG’s discretion by setting out the objectives of such agreements: denouncing an organization’s wrongdoing; encouraging voluntary disclosure of it; providing reparations for harm done to victims or to the community; and reducing the negative consequences for those who did not engage in the wrongdoing—employees, customers, pensioners and others. The point is to do all this while holding responsible those who did engage in wrongdoing.

All of these purposes fall within the traditional mandate of the attorney general, but the public interest in these cases also has potential political ramifications. In a 1990 working paper on the attorney general and the Crown prosecutor, the Law Reform Commission of Canada observed that political considerations should not in normal circumstances affect prosecutorial decisions. The AG may seek the advice of cabinet, but is not bound by that advice.

With respect to the facts involving SNC-Lavalin, I have no knowledge and make no comment about what occurred or did not occur. My point is a larger one about the need for the development of transparent guidelines. Cabinet has the power to make regulations generally for the purpose of deferred prosecutions. To date, it has not done so. The role of the attorney general in remediation agreements requires careful study by a body such as a Law Reform Commission, (which no longer exists as it was abolished by previous governments. Full disclosure: I worked for the commission at the start of my career). The creation of detailed and transparent guidelines in the regulations, after careful study, would be helpful.

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The commission’s Working Paper 62 identified the potential for a political storm when an attorney general is caught between the wishes of cabinet and his or her own judgement:

“Nevertheless, the federal Attorney General is appointed by the Prime Minister and so could be dismissed from office for insisting on a course of conduct that is against the advice of the Cabinet. In such circumstances the Attorney General might feel compelled to resign before being dismissed. Either event could be expected to have a serious political impact affecting even the government’s survival.”

In light of cabinet and solicitor-client privilege, we cannot draw direct parallels between present events and the above passage, but this illustrates that the tensions in the AG’s role have been debated for years.

In the discussion about the SNC-Lavalin case, we must not lose sight of the positive benefits of deferred prosecutions and the merits of the Canadian scheme. There is a judicial check or safeguard on remediation agreements: a court must be satisfied that the agreement is fair, reasonable and proportionate to the gravity of the offence. This requirement follows a model developed in the U.K. (There is however no explicit mechanism for court review of the opposite decision to not grant a remediation agreement).

As I’ve noted, one objective of a remediation agreement is to encourage voluntary disclosure of wrongdoing. Where an organization discovers misconduct that the police are not aware of, there is a need for a carrot, or incentive, for the organization to “come in from the cold”. Enforcement authorities gain the benefit of internal investigations that are funded by industry and disclosed voluntarily, which saves government time, cost and resources and brings to light misconduct that might otherwise never become public.

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We must also remember that a remediation agreement is not a “free pass” from justice. It must include the payment of a penalty. More importantly, it requires the company to forfeit any property, financial gains, benefits or advantages arising from the misconduct to Her Majesty. The agreement can also allow the appointment of an independent monitor, selected with the prosecutor’s approval, to verify and report on the organization’s compliance—including the obligation to cooperate with and pay the monitor’s costs. This person is an embedded auditor whose role is akin to a police officer residing at a business for a period of time.

Compared to the U.S. and the U.K., Canada is a relative neophyte in the world of deferred prosecutions, which were long overdue. In drafting guidelines cabinet should look at the practice in other jurisdictions to see how they strike the delicate balance between prosecutorial independence and accountability to the public.

Kenneth Jull is the author of Profiting from Risk Management and Compliance, an adjunct professor at U of T Faculty of Law and Osgoode Hall Law School and counsel at Gardiner Roberts LLP specializing in risk management strategies to promote regulatory and corporate compliance

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Virtual farmer’s market comes to Ottawa

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Ottawa first-ever virtual farmer’s market has begun delivering food from local farms straight to people’s homes.

Farm to Hand is making it easier for people who cannot access their local farmer’s markets to find local, fresh organic food by bringing ordered food right to their doors. 

“The difference between us and the farmers market is really just the convenience and the on-demandness,” Sean Mallia, the co-founder of the business, told CBC Radio’s In Town and Out.

“[Often times a] person wants to make the purchase but they don’t have the time on Saturdays to go to the farmers market. Everyone wants to eat local … so when it’s easy for them to do it, it just happens.” In Town and Out No time to drive to the farmer’s market but really want to eat local?

Connecting farmers with people 

The online platform allows farmers to list all their own products, and buyers can have the goods delivered. 

“What we really are trying to do is build that connection between farmer and consumer,” Mallia said. “When people fill up a cart … they’re not just filling a cart full of food, they’re filling a cart full of farmers and farms and their stories.”

Mallia said the aim is to connect people to the “vibrant food ecosystem” around them, and to local support farmers.

The virtual market is currently limited to the Ottawa area as a pilot project, but Mallia, 21, said the company is looking to expand.

“[We chose Ottawa because] Ottawa really cares. Ottawa really thinks about local [food] and thinks about sustainability,” he said. “It just made sense to come out of Ottawa.”

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Denley: Stonebridge and Mattamy show compromise is possible over development in Ottawa

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In Ottawa, development proposals too often end up in acrimony and trips to the provincial planning tribunal. That’s why it’s so refreshing to see Mattamy Homes and residents of the south Nepean suburb of Stonebridge work together to resolve a dispute in a way that’s likely to lead to a victory for both sides.

A little over a year ago, Mattamy created an uproar in the golf course community when it announced a plan to build 158 new homes on golf course lands and alter the Stonebridge course to make it shorter and less attractive to golfers. To residents, it looked like the first step in a plan to turn most, or all, of the course into housing.

It’s easy to see why residents were upset. When people pay a premium for a lot backing onto a golf course, there is certainly an implication that the lot will continue to back onto a golf course, but without a legally binding guarantee, it’s no sure thing.

Mattamy’s situation was understandable, too. This is a tough time to be in the golf course business in Ottawa. There are too many courses and not enough golfers so it’s no surprise that golf course owners would find the idea of turning a course into a housing development to be attractive, doubly so when the golf course is owned by a development company.

This is a tough time to be in the golf course business in Ottawa. There are too many courses and not enough golfers so it’s no surprise that golf course owners would find the idea of turning a course into a housing development to be attractive.

In the face of the local opposition, Mattamy withdrew its development application. When things cooled down, the company, the neighbours and the city started to work together on finding a solution that would satisfy everyone.

With the city-sponsored help of veteran planning consultant Jack Stirling, they came up with an unusual idea that will still let Mattamy develop its desired number of homes, in exchange for a promise to operate the course for at least 10 years and redesign it so that it remains attractive to golfers.

At the end of the 10 years, Mattamy can sell the course to the community for $6 million. To raise the money, the community working group is proposing a special levy to be paid by Stonebridge homeowners starting in 2021. The amount will range from $175 a year to $475 a year, depending on property values.

If the deal is approved by a majority of homeowners, Mattamy gets its development and a way out of the money-losing golf business. Homeowners get certainty about no future development. They can choose to keep the course going or retain the 198 acres as green space. It’s not a cheap solution, but it keeps their community as it is and preserves property values.

If a majority of homeowners backs the deal, both the levy and redevelopment will still need to be approved by the city, something scheduled for late this fall.

Stonebridge Community Association president Jay McLean was part of the working group that prepared the proposal and he’s pleased with the outcome. The community’s number one goal was preserving green space, and the deal will accomplish that, he says. Mattamy division president Kevin O’Shea says the deal “gives the community the certainty they are looking for.”

As useful as this deal could be for Stonebridge residents, it doesn’t provide a template to resolve a somewhat similar dispute in Kanata North, where the owner of the Kanata Lakes golf course wants to work with a group of local developers to replace the course with housing. In Kanata, a longstanding legal agreement saying the community has to have 40 per cent open space strengthens residents’ situation. In Stonebridge, there was no legal impediment to developing the whole course.

Golf course communities have become an anachronism in a city intent on intensifying within the urban boundary. Redeveloping those lands for housing is in sync with the city’s planning goals, but it’s not politically saleable to homeowners who thought they had a deal. If it goes ahead, the Stonebridge plan shows there is a reasonable middle ground.

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City eyes five big themes for Ottawa’s new official plan

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As Ottawa maps out its future for the next 25-plus years, city staff propose focusing on five major areas, including the places we live and the ways we move around the capital.

A staff report to the city’s planning committee lays out five themes for future public consultations, before city council finalizes the plan.

1. Growth Management: City staff say Ottawa should focus on building up, rather than out. Staff also suggest the city provide direction on the type of new housing developments, rather than focusing on the number of units in a development, to encourage a wider variety of housing types.

2. Mobility: Staff say the city should encourage active transportation — like walking and cycling — and transit use by better co-ordinating land use and transportation planning. The report also encourages designing streets to better accomodate pedestrians and cyclists, as well as improving connections to the O-Train and Transitway.

3.  Urban and Community Design: Because Ottawa is a major city and the nation’s capital, staff say the design of our city’s buildings and skyline should be a higher calibre to reflect that status. Staff also suggest the city provide high-level direction for better designed parks and public spaces.

4. Climate, Energy and Public Health: Staff say residents’ health must be foundational to the city’s new official plan, with policies contributing to creating more inclusive, walkable, and sustainable communities.

5. Economic Development: Because much of Ottawa’s employment is knowledge-based, the city suggests those employment spaces could be better integrated into neighbourhoods and along main streets and transit nodes, instead of being isolated in business parks. City staff also suggest the city encourage more business incubation and identify opportunities to increase local food production.

The city’s new official plan will map out the city’s growth to 2046. The five themes and the plan’s high-level policy direction will go before the city’s planning committee, next week.

Public consultation and fine-tuning is expected to happen before city council approves the final version of the new official plan in 2021.

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