Court Information

Ontario Court of Justice

Between:

James Carroll The Applicant

— AND —

Her Majesty the Queen The Respondent

Before: Justice Diane M. Lahaie

Ruling released on: April 7, 2016

Counsel

Mr. Vern Brewer — for the Public Prosecution Service of Canada

Mr. M. Johnston — for the Applicant, James Carroll

LAHAIE, J.:

Ruling on the Application

[1] James Carroll faces one count of undertaking to communicate with a public office holder for payment and failing to file a return with the Office of the Commissioner of Lobbying, contrary to s. 5(1) of the Lobbying Act, thereby committing an offence under s. 14(1) of the said Act.

[2] Counsel for Mr. Carroll brought a pre-trial Application challenging the legislation on two grounds. Firstly, the Applicant argues that the "Offence and Punishment" provisions of the Lobbying Act conflict with rights granted in the English Bill of Rights, 1689, which guaranteed: "That it is the Right of the Subjects to petition the King and all Commitments and Prosecutions for such Petitioning are Illegall". Secondly, the Applicant challenges the applicable provisions of this legislation, arguing that they limit free political expression as guaranteed by s. 2(b) of the Canadian Charter of Rights and Freedoms.

Issue 1 – Rights granted in the English Bill of Rights, 1689

[3] The Applicant argues that the English Bill of Rights, 1689, is a quasi-constitutional instrument, which grants rights which have never been overridden, abrogated or amended in regards to a person's right to petition the government. Accordingly, to the extent that the Lobbying Act conflicts with the right to not be prosecuted for petitioning the government, the Applicant argues that the legislation is inoperable.

[4] I have reviewed the Applicant's materials, including his factum and caselaw. I have also reviewed his submissions. This argument is rejected.

[5] The offence and punishment provisions of the Lobbying Act are engaged based on an alleged violation of the obligation imposed on paid consultant lobbyists to file prescribed returns with the government, disclosing specific information about their lobbying activities on behalf of the clients they represent.

[6] Even if the right conferred in the English Bill of Rights, 1689 has any application in Canadian law today, the requirements of section 5 of the Lobbying Act cannot be said to impede that right. The right to petition or lobby the government is not prohibited by the legislation and all persons retain the right to petition the government directly on their own behalf, without fear of penal consequences. There is no reporting requirement on individuals who petition public officials on their own behalf and these individuals do not face any potential sanctions within the legislation. In fact, the person whose petition is being advanced to the government suffers no penal consequences, even where the paid lobbyist, acting on his or her behalf, fails to comply with section 5 of the Act.

[7] The right to lobby is not offended, even if the right is read as extending to the activities of paid lobbyists or consultants, acting on behalf of an individual. The Act merely requires that the paid lobbyist file information returns setting forth prescribed information as to the lobbying activities in certain prescribed circumstances. Access to government by paid lobbyists, the manner of lobbying and the content of the lobbying are not prohibited or regulated by the Lobbying Act. The intent and effect of the legislation, in regards to the requirement to file a return, are to prevent paid lobbyists from petitioning the government in secret.

[8] The Applicant's request for an order declaring that the "Offence and Punishment" provisions of the Lobbying Act be declared invalid because they conflict with the right to petition government granted in the English Bill of Rights, 1689, is denied.

Issue 2 – Do subsections 5(1) and 14(1) of the Lobbying Act infringe on the Freedom of Expression guaranteed by s. 2(b) of the Canadian Charter of Rights and Freedoms

[9] During this hearing, the Crown provided the Court with the affidavit of Reham Sannoufi, the Director of La Vie Executive Health Centre (hereinafter referred to as "La Vie"). Ms. Sannoufi was cross-examined on her affidavit by the Applicant's counsel.

[10] The Applicant filed the synopsis of the R.C.M.P. and the Letter of Agreement between La Vie and Tactix Government Relations and Public Affairs Incorporated (hereinafter referred to as "Tactix"). The Applicant did not testify and did not file an affidavit. On consent of the parties, the materials filed by the Applicant, which included "anticipated facts" contained in a factum, will serve as the Applicant's evidence on the Application.

[11] The evidence of Ms. Sannoufi was that she and her husband, a physician, devised a method of managing vital medical information. They were interested in selling their idea or product. Ms. Sannoufi searched the Internet for a lobbying firm and sent email correspondence to Mr. Howard Mains on June 28, 2012. The Applicant, Mr. Carroll responded to this communication on behalf of Tactix. In July 2012, he was a "Principal", employed by Tactix.

[12] Ms. Sannoufi met with the Applicant to explain her idea. The Applicant was, at all material times, Ms. Sannoufi's only contact at Tactix.

[13] On July 9, 2012, the Applicant sent Ms. Sannoufi a letter of agreement on Tactix letterhead, setting out the essence of their discussion, the proposed terms of engagement which included a timeline for lobbying the government, objectives, the financial terms and the requirements that consultants comply with lobbyist registration pursuant to the Lobbying Act. The agreement was signed by the Applicant, who identified himself as a "Principal". In the letter, Mr. Carroll invited Ms. Sannoufi to return a signed copy of the agreement so that they could begin work on July 15, 2012. Ms. Sannoufi signed the letter on July 11, 2012 and returned it to Mr. Carroll.

[14] The Applicant concedes, for the purpose of the Application, that if he had signed the agreement letter as a consultant lobbyist, he would have been obligated to file a return setting out the information required by section 5(2) of the Lobbying Act within the prescribed time.

[15] According to Ms. Sannoufi's evidence, Mr. Carroll suggested that the Department of National Defence be approached in regards to La Vie's product. The engagement letter confirms that the Applicant planned to "work with senior officials across government and within defined verticals to build support for a pilot project". The agreement required La Vie to pay $10,000 per month for the lobbying firm's services for a minimum of six months, starting July 15, 2012. Ms. Sannoufi made the payments for approximately six months. Tactix was billing Ms. Sannoufi for various services, including meals with individuals in what was referred to as "informal meetings", as attempts were being made to secure a pilot project with the Department of National Defence.

[16] At one point, steps were taken to obtain intellectual property protection. Ms. Sannoufi testified that she had no interest in obtaining a patent but that she agreed to do so, on Mr. Carroll's recommendation, as she believed this was a stepping stone to securing a pilot project with the Department of National Defence.

[17] Ms. Sannoufi testified that Mr. Carroll did not talk to her about the requirements under the Lobbying Act. There is mention of these requirements in the letter of agreement however the evidence does not reveal that the issue was ever discussed beyond the date of the letter.

[18] In her affidavit, Ms. Sannoufi attests to now having reviewed the prescribed return and that she was not aware of the document, the information that is required to complete it or that once such returns are filed with the Office of the Commissioner of Lobbying of Canada, that the contents of the returns become public knowledge.

[19] Ms. Sannoufi's affidavit further establishes that she would not have had any concerns with the public disclosure of the information that would be contained on the form, had such a return been filed with respect to La Vie when the agreement with Tactix was signed. Specifically, Ms. Sannoufi states:

"Specifically, on behalf of La Vie, I would not have had any concerns that La Vie's idea or product would be compromised should this information have been made public before any patent protection was in place for La Vie. A possible requirement to file a completed return and the public disclosure of the information it contains would not have had any impact on La Vie's decision to ask Tactix as a lobbying firm to pursue business opportunities on behalf of La Vie with the Department of National Defence or any other federal government department".

[20] During her testimony, Ms. Sannoufi added that she would have appreciated compliance by the Applicant, as she would have been able to track the progress of efforts made on behalf of La Vie. She testified that her current lobbyist has filed the requisite return and that there is no disclosure of information in the return which has given her concerns in regards to any intellectual property issues.

[21] At no time did Mr. Carroll or anyone at Tactix file a return under the Lobbying Act.

[22] Defence counsel argues that the Lobbying Act infringes the freedom of expression as it regulates the free flow of political ideas to the government and therefore limits an activity that is protected by s. 2(b) of the Charter. Counsel argues that the purpose of the Lobbying Act, to create greater governmental transparency, is achieved by unconstitutional means. He maintains that it violates the freedom of expression, as the registry is created by the compelled disclosure of information by paid lobbyists.

[23] The Supreme Court of Canada set out the approach to be taken by the Court in assessing whether there has been a violation of section 2(b) of the Charter in the matter of Irwin Toy Ltd. v. Quebec (Attorney General), [1989] 1 SCR 927. I have reviewed this case as well as all of the cases contained in the parties' books of authorities.

[24] The Applicant rightly agrees that he bears the burden of demonstrating that the effect of the government's action has restricted his free expression. Relying on the language used by the Supreme Court of Canada in Irwin Toy Ltd. v. Quebec (Attorney General), supra, the Applicant argues that the effects of the government's action (in requiring the filing of a return by a paid third party lobbyist and imposing penalties for failure to do so) has restricted the Applicant's free expression and "impeded (his) pursuit of truth, participation in the community or individual self-fulfillment and human flourishing".

[25] More specifically, the Applicant points to the information compelled by the Lobbying Act's registry system as set out in section 5(1) of the Act. Included in the information to be disclosed are "particulars to identify the subject-matter in respect of which the individual undertakes to communicate with a public office holder or to arrange a meeting, and any other information respecting the subject-matter that is prescribed".

[26] The Applicant explains that the return, which should have been filed by July 21, 2012 in order to be in compliance with the legislation, would have disclosed particulars of La Vie's product, not only to government, but also to the public who have access to the registry. Given the sensitive nature of the idea and the fact that patent protection was not obtained until December 2012, the Applicant was not prepared to jeopardize the client's interests.

[27] The Respondent, relying primarily on the decision of the Supreme Court of Canada in Danson v. Ontario (Attorney General), [1990] 2 S.C.R. 1086, argues that the Application must fail because the Applicant has not provided the Court with a proper factual foundation to support his claim.

[28] While the Applicant has provided a factual foundation for his argument, I reject the argument that the Applicant did not file a return out of concern for La Vie's intellectual property interests. There is overwhelming evidence before me that supports the conclusion that the Applicant did not turn his mind to this issue as a basis for a conscious decision to avoid filing the prescribed return.

[29] Firstly, there is no evidence before me that the Applicant discussed his concerns about filing a return and the potential jeopardy of disclosure with any other members of his firm. Secondly, the evidence clearly demonstrates that the Applicant never discussed such concerns with Ms. Sannoufi or any other decision-maker at La Vie. Ms. Sannoufi's evidence is that:

1. When she signed the agreement with Tactix, she was not aware of the return that is filed pursuant to section 5, the information required to complete the return, or that such information becomes public knowledge once the returns are filed;

2. On behalf of La Vie, she would not have had any concerns with the public disclosure of the information that would be contained on the return had such a return been filed when or shortly after the agreement between La Vie and Tactix was signed;

3. On behalf of La Vie, she would not have had any concerns that La Vie's idea or product would be compromised should this information have been made public before any patent protection was in place; and

4. That a possible requirement to file the section 5 return and the public disclosure of the information on the return would not have had any impact on La Vie's decision to ask Tactix as a lobbying firm to pursue business opportunities with the federal government.

[30] In short, La Vie had no concerns in regards to the information which would have been disclosed in the prescribed return. The Applicant did not ever tell Ms. Sannoufi that this was a concern of his and a reason why he was intentionally not filing a return.

[31] The Applicant states that Tactix was not prepared to disclose the nature of La Vie's product to the government until after sufficient legal protections were obtained, which did not occur until December 4, 2012. However, the Applicant did not file a return after December 4, 2012 either, when these concerns would have been alleviated. There is no evidence that the Applicant ever filed the requisite return.

[32] It is not, as in the matter of Danson v. Ontario (Attorney General), supra, that this Court questions whether the issue can be determined in a factual vacuum. Rather, it is that the concerns purported to have existed are rejected in this case.

[33] That being said, even if the Court had accepted that the Applicant had intentionally failed to file a return out of concern for the client's intellectual property interests, I would not have found favour in the Applicant's argument as the impugned provisions do not in any way restrict or regulate the conduct of the intended direct beneficiaries of the communications (hereinafter referred to as "the client").

[34] On the broader level, the Respondent concedes that lobbying is an activity that conveys or attempts to convey a meaning and therefore is protected by the freedom of expression guarantees under section 2(b) of the Charter.

[35] The Applicant concedes that the purpose of the Lobbying Act is not to restrict freedom of expression. The challenge is on the effect of the legislation.

[36] It is of paramount importance in my view, that there exists no regulation, should a person decide to lobby on his or her own behalf. The impugned provisions also do not restrict or regulate the client's ability to hire a paid lobbyist to communicate with the government, nor do they restrict or regulate the message sought to be conveyed, either by the client personally or by the lobbyist. The provisions do not impede or otherwise restrict access by the paid lobbyist to the government. Furthermore, should the lobbyist fail to file a return, there are no consequences under the Lobbying Act for the client. The penal sanctions for non-compliance with section 5 can only be imposed upon the intermediary, that is, the paid consultant lobbyist. The imposition of consequences on the consultant lobbyist for failure to file a return does not have the effect of restricting the expression of those attempting to convey meaning, that is, the clients or originators of the communication.

[37] These important differences sufficiently distinguish the present matter from the cases dealing with the Canada Elections Act, which impose reporting obligations and potential penal consequences for non-compliance upon the originators of communications.

[38] The impugned provisions of the Lobbying Act do not affect the ability of the originator of communication to convey meaning to federal public office holders, nor do they affect the ability of the originators of such communications to use paid lobbyists to assist in their communications or the ability of paid lobbyists to convey the communication from their clients to federal public office holders.

[39] The reporting regime is intended to ensure transparency and openness, allowing the public to know the identity of the paid lobbyists who are communicating with public office holders and which interests these lobbyists represent.

[40] I find that the provisions of the Lobbying Act under review do not breach section 2(b) of the Charter, either on the facts of this case or in the broader sense.

[41] The Application is dismissed.

Released: April 7th, 2016

The Honourable Justice Diane M. Lahaie