R. v. Durward, 2015 ONSC 834
COURT FILE NO.: 09-300-68
DATE: 2015/02/05
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
HER MAJESTY THE QUEEN
– and –
Marina Durward, Susan Laycock, Philip McDonald, Donald Powell, Thomas Townsend, Ronald Walker, David Watts, The Devon Group Ltd., Spearhead Management Canada Ltd., and TPG Technology Consulting Ltd.
Defendants
Denis Pilon, Valerie Chénard and Narissa Somji, for the Crown
Patrick McCann for the Defendant Philip McDonald, Peter N. Mantas for the Defendant TPG Technology Consulting Ltd., and Leslie Wilbur for the Defendant Ronald Walker
HEARD: January 29, 2015 (in Ottawa)
Ruling on similar fact evidence motion
Madam Justice B. R. Warkentin
[1] At the conclusion of its case, the Crown brought this motion seeking an order that, for each accused charged with more than one count of bid-rigging contrary to s. 47 of the Competition Act or with more than one count of conspiracy contrary to section 465 of the Criminal Code, the jury should be instructed that they may take into account the evidence admissible on one count across all other counts.
[2] This motion is therefore directed at the following six accused:
(a) Marina Durward (aka Mancini) Counts 1 through 20
(b) Susan Laycock (aka McGregor) Counts 1 through 22
(c) Philip McDonald Counts 1 through 20
(d) Donald Powell Counts 1 through 20
(e) Spearhead Management Canada Ltd. Counts 11 through 20
(f) TPG Technology Consulting Ltd. Counts 11 through 20
[3] The Crown proposed that the similar fact evidence would apply only against the counts for which a party is charged, with the exception of counts 21 and 22, which do not form part of the Crown’s motion.
[4] There were 10 different federal government procurements that are the subject of this trial. Each of the four individual accused set out above is charged with both bid-rigging and conspiracy for each of the 10 procurements (20 counts). The two corporate accused have been charged with conspiracy for the 10 separate procurements (10 of the 20 counts).
[5] The 10 procurements have been divided into three categories. Eight of the procurements were issued by Public Works and Government Services Canada (“PWGSC”) on behalf of Canada Border Services Agency (“CBSA”), one of the procurements was issued by PWGSC on behalf of Canada On-Line Services and the last procurement was issued by Transport Canada on its own behalf.
[6] All of the CBSA procurements contained the same essential terms and conditions and there is no dispute among the parties that some type of similar fact evidence should be permitted with respect to this group of eight procurements. Because the defence has yet to present their evidence, I have advised the participants that I will revisit the manner in which the similar fact evidence should be dealt with regarding these eight procurements after the defence has concluded their case.
[7] It is the Crown’s position that all 10 procurements (Requests for Proposal or “RFPs”) were similar in nature because they were all issued by the federal government for the procurement of IT professional services.
[8] The Crown contends, therefore, that with respect to the charges against each accused, the evidence against that accused should be admissible against that same accused in relation to all the counts on which that particular accused has been charged. For example, in the case of Susan Laycock, the evidence admissible against her in relation to the Canada On-Line RFP (relating to counts 2 and 12) would be permitted to be taken into account by the jury as against Ms. Laycock for all the other counts 1 through 20 on which she is also charged. Similarly, the evidence admissible against Ms. Laycock in relation to the Transport Canada RFP (counts 1 and 11) would also be permitted to be taken into account by the jury against her for counts 1 through 20. And finally, the evidence admissible against Ms. Laycock on each count in relation to the CBSA RFPs (counts 3 to 10, and counts 13 to 20) would be permitted to be taken into account by the jury against her for all the other counts on which she is charged, including all of the counts relating to the CBSA RFPs.
[9] The same reasoning would apply to each of the five other accused identified above with respect to the counts on which they are charged.
[10] The Crown submitted that all the acts alleged in the various counts are closely interwoven and interrelated, and that there is sufficient temporal connection between the counts, so that the totality of the evidence is material and relevant to each count in order to:
a) prove knowledge, intent and state of mind of the defendants;
b) rebut the claim of lack of criminal intent or knowledge of or participation in conspiracy or bid-rigging;
c) prove the existence of a scheme, system, or plan aimed at submitting bids arrived at by agreement which were not disclosed to the tendering authorities;
d) rebut character evidence; and
e) decide, if a party had authority to act as a senior officer in relation to one RFP, whether that authority applied to the other RFPs.
[11] The Crown also submitted that the evidence is similar both with respect to the procurement processes involved in this case between the CBSA, Canada On-Line Services and Transport Canada RFPs, and with respect to the alleged conduct by the defendants in responding to these RFPs.
[12] The defence disagreed with the Crown’s proposed approach to the application of similar fact evidence. The defence submitted that similar fact evidence is admissible only if it is uniquely similar, connected to an issue in the trial, and has greater probative value than prejudicial effect.
[13] The defence argued that in attempting to apply those requirements to the facts in this proceeding, they do not fit. It was their position that much of the conduct referred to by the Crown as being similar has been admitted, for example, that the accused were working together to recruit resources for these procurements, and as such is irrelevant to the admissibility determination of that evidence.
[14] There is no issue that the defendants formed consortiums of some form for all three groups of RFPs. For the CBSA RFPs the defendants worked together as a group on the eight proposals, but submitted independent proposals. In the Canada On-Line RFP there were two declared joint ventures in which one of the corporate defendants (Spearhead) was the lead on one joint venture and TPG was a common partner to both joint ventures.
[15] The Transport Canada RFP included a much larger group of vendor companies that worked together. They prepared a written contractual joint venture agreement. It will be for the jury to decide if, after the RFP was amended to permit the non-exclusivity of submitting resources, the three separate joint ventures submitted constituted the criminal activity for which they have been charged.
[16] There are two significant issues (among others) to be decided by the jury. The first is whether or not these RFPs were in fact calls for bids or tenders, and if they decide in the affirmative, the second issue is whether the proposals submitted for the RFPs were arrived at by an arrangement or agreement that was not made known to the entity calling for the bids or tenders.
[17] The defence argued that the proposed use of the evidence as similar fact does not logically tend to establish those elements.
[18] Because I am not making a determination in these reasons as to the use of similar fact evidence that may be put to the jury on the group of eight CBSA RFPs, these reasons will address only the issue of whether or not an instruction on evidence of similar facts is permissible for the three groups of RFPs.
The Law
[19] There was no dispute between the Crown and defence about the applicable law and test to be applied in a motion to present evidence of similar facts. The guiding principles continue to be derived from the Supreme Court of Canada case of R. v Handy as follows:
Similar fact evidence is thus presumptively inadmissible. The onus is on the prosecution to satisfy the trial judge on a balance of probabilities that in the context of the particular case the probative value of the evidence in relation to a particular issue outweighs its potential prejudice and thereby justifies its reception.[^1]
If the issue has ceased to be in dispute, as for example when the fact is admitted by the accused, then the evidence is irrelevant and it must be excluded.[^2]
[20] In order to gain entry as evidence of similar facts, whether or not the similar facts alleged involved intrinsic misconduct, or as in this case conduct that is the subject of other counts on the same indictment, the evidence of the similar facts must be appropriately connected to the facts alleged in an individual count. Similarities in character and in proximity, both in time and in frequency of occurrence, are important factors.[^3]
[21] The principal driver of probative value in a case such as this is the connectedness (or nexus) that is established between the similar fact evidence and the offences alleged. The degree of similarity will depend upon the issues in a particular case, the purpose for which the evidence is sought to be introduced and the other evidence.[^4]
[22] The degree of similarity required for similar fact evidence to be admitted need not be that the facts under consideration are identical or even strikingly similar. Furthermore, where the similar fact evidence does not relate to the issue of identity, a lower degree of similarity is required.[^5]
Degree of Similarity
[23] The similarities among the three groups of RFPs are as follows:
a) all the solicitations were “Requests for Proposals” issued by the federal government, and they were all for the supply of services in relation to IT professional resources;
b) the intent of the RFPs was to award up to three contracts (in the case of Canada On-Line it was two contracts) for the provision of professional services for a range of professional resources with specific subject matter expertise and skill‑sets; and
c) all the RFPs resulted in contract awards and in the issuance of Task Authorizations to place the resources submitted in all of the RFPs.
[24] The similarities among the conduct of the defendants that the Crown seeks to introduce in response to the three groups of RFPs are as follows:
a) the defendants agreed to work collectively and communicated by email and through regular meetings in response to each of the RFPs;
b) they divided the responsibility for recruiting resources to be submitted on the proposals;
c) the two corporate defendants, Spearhead and TPG, together with the immunity applicant, Veritaaq Technology House Inc., were involved in all three groups of RFPs; and
d) there was discussion at some level of using a three-bid strategy for all three groups of RFPs (a two-bid strategy in the case of the Canada On-Line RFP).
[25] There are also a number of differences in the three groups of RFPs and the approach taken by the defendants in response to them, some of which are as follows:
a) the Canada On-Line and Transport Canada RFPs did not require companies submitting proposals to be pre-qualified on the Government On Line (GOL) system, whereas the CBSA RFPs did;
b) the Transport Canada RFP sought 39 separate resources whereas the CBSA RFPs bundled the resources in categories;
c) the resources sought by the Transport Canada RFP had to be exclusive to one vendor until a few days prior to the closing date, when that criteria was removed;
d) the Canada On-Line RFP sought to award only two contracts and the method of awarding Task Authorizations was on a rotating basis rather than by a competition between the three contracts awarded under the CBSA and Transport Canada RFPs;
e) in both the Transport Canada RFP and the Canada On-Line RFP, the defendant vendors declared their joint ventures, whereas no joint ventures were permitted (unless they had already been cleared on the GOL system, which was not applicable to these defendants) and as such none were declared on the CBSA RFP proposals;
f) there were different groups of vendors participating in the Transport Canada proposal and it was a different government agency conducting this procurement;
g) the issues for the jury to decide regarding the Canada On-Line RFP and the Transport Canada RFP are different than for the CBSA RFPs because:
i. the issue regarding the Canada On-Line RFP is whether the existence of a common partner requires a different assessment of the “made known” defence, and
ii. the Transport Canada RFP included many more vendors who were working together due to the nature of the RFP and the initial exclusivity of resources, and there was an attempt, in some fashion, to reduce the terms of working together into a written contractual joint venture agreement; and
h) the Canada On-Line RFP specifically stated that it was not a request for bids or tenders.
Probative Value vs. Prejudicial Effect
[26] With respect to the issue of the potential prejudicial effect of permitting the evidence of similar facts, I must consider both moral and reasoning prejudice.
[27] Moral prejudice is the risk of convicting the defendants because they are “bad people” rather than based on proof that they committed these offences. Reasoning prejudice is the risk of distracting or confusing the jury or of consuming an undue amount of time.
[28] In this case the concern for moral prejudice is almost completely negated because the jury has already heard the evidence of all of the facts alleged to be similar. The 10 individual RFPs are contained as separate counts on the indictment; therefore the risk of the jury casting the defendants in a poor light would not be eliminated by excluding the similar fact evidence. Likewise, because the similar facts relate to equal charges on the indictment they are of equal severity.
[29] I find therefore that the potential for moral prejudice is minimal and does not outweigh the probative value of permitting the evidence of the similar facts.
[30] The risk of reasoning prejudice is minimal as it pertains to the CBSA RFPs if they are considered as a group. Again, the evidence of the similar facts is already before the jury and already forms part of the case the Crown must meet. Any risk can be addressed in an appropriate charge dealing with the manner in which the jury is to use the evidence of similar facts. This is the issue I have deferred until the close of the case for the defence.
[31] The Crown’s application is more problematic with respect to the application of evidence of similar facts from the CBSA RFPs to both the Canada On-Line and Transport Canada RFPs.
[32] Most of the similarities that exist, such as the existence of a group of vendor companies working together to recruit resources and the fact that the RFPs were all for federal government contracts of IT services, are not disputed by the defence. This evidence should more correctly be set out in my charge to the jury as evidence that is not disputed, rather than as evidence of similar facts.
[33] I find however, that the differences among the three groups of procurements are of sufficient number and significance as to diminish the probative value of presenting it as evidence of similar facts.
[34] The differences are significant in that they go directly to the issues the jury must decide. It is entirely conceivable that the jury could decide quite differently between the three groups of procurements. As such, to grant the Crown’s application for this purpose could result in a risk that the jury would be distracted or consume undue time trying to resolve these differences.
[35] The Crown’s Application is therefore granted in part with respect to the CBSA RFPs, subject to the findings I have made in these reasons and to further submissions at the conclusion of the evidence for the defence.
Madam Justice B. R. Warkentin
Released with publication ban: February 5, 2015
Released for publishing: April 27, 2015
CITATION: R. v. Durward, 2015 ONSC 834
COURT FILE NO.: 09-300-68
DATE: 2015/02/05
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
HER MAJESTY THE QUEEN
– and –
Marina Durward, Susan Laycock, Philip McDonald, Donald Powell, Thomas Townsend, Ronald Walker, David Watts, The Devon Group Ltd., Spearhead Management Canada Ltd., and TPG Technology Consulting Ltd.
Defendants
RULING on similar fact
evidence motion
Warkentin J.
Released with publication ban: February 5, 2015
Released for publishing: April 27, 2015
[^1]: R. v. Handy (2002), 2002 SCC 56, 164 C.C.C. (3d) 481 (S.C.C.), at para. 55
[^2]: R. v. Handy, at para. 74, referencing R. v. Clermont, 1986 26 (SCC), [1986] 2 S.C.R. 131, at p. 136
[^3]: R. v. MacCormack, 2009 ONCA 72, [2009] ONCA 72, 241 C.C.C. (3d) 516, at para. 62
[^4]: R. v. Handy, ibid., at paras. 76 to 80; R. v. Kirk (2004), 2004 7197 (ON CA), 189 O.A.C. 314, at paras. 13 to 15; R. v. MacKormack, ibid., at paras. 49 and 70
[^5]: R. v. Arp, 1998 769 (SCC), [1998] 3 S.C.R. 339, at paras. 44-45