Phillips v. Ottawa (Elections Compliance Audit Committee), 2025 ONSC 1180

COURT FILE NO.: CV-24-00097752
DATE: 2025-02-21
SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Edward Phillips, Appellant
-and-
City of Ottawa Elections Compliance Audit Committee, Respondent

BEFORE: C. MacLeod
COUNSEL:
John G. Pappas, for the Appellant
James Plotkin and Darren Johnston, for the Respondent
HEARD: 2025-02-20 by videoconference

Endorsement

[1] This is an appeal under s. 88.33(9) of the Municipal Elections Act, 1996. The facts are almost identical to those discussed by my colleague Justice Somji in Thompson v. City of Ottawa Elections Compliance Audit Committee (“ECAC”) decided just weeks ago. I will not repeat the description of the legal framework or the analysis set out in that decision as the parties both rely on the decision. I adopt Justice Somji’s conclusions concerning the standard of review and the purpose of the legislation.

[2] In this case, as in Thompson, the candidate made an error on his “Form 4” financial statement. The candidate was required to value campaign signs left over from a previous election and used in the 2022 municipal election. The present value of the signs must be counted as an election contribution from the candidate himself and must also be counted as an election expense.

[3] Unlike in Thompson where the ECAC had ordered a compliance audit and was upheld on appeal, in the case now before the court the ECAC (“the tribunal”) declined to make such an order and it is the failure to order an audit that is under appeal.

[4] In this case, during the hearing under questioning from the tribunal, the candidate acknowledged that the value of the election signs kept in inventory from the previous election and shown on his Form 4 was in error. In estimating the value, he had failed to account for large signs valued at $36.75 per sign and small signs valued at $5.65 per sign.

[5] I note that, according to the evidence of the candidate before the tribunal, the error may have been only $30.00 but even if it was $1,000.00 it would not have put the candidate over the allowable contribution or expense limit. Under the scheme of the legislation, however, the function of the audit committee at this point is simply to determine if an audit should be ordered or not. An audit is to be ordered if the committee agrees with the complainant that there are “reasonable grounds” to believe the candidate has contravened a provision of the Act.

[6] As discussed by Justice Somji and accepted by both parties in argument, a failure to complete Form 4 accurately may be a breach of the Act even if it appears de minimus. An error that is not a mere typographical error but is a substantive inaccuracy in calculation or reporting is sufficient to clear the very low hurdle at the first step of the s. 88.33 procedure.

[7] In order to ensure transparency in municipal election financing and expenditures and because an error in reporting could be indicative of further irregularities, the ECAC should order an audit even if the Form 4 contains a minor financial irregularity. In Thompson, the tribunal did order an audit and that decision was upheld. In the decision before me, the tribunal did not order an audit. It is impossible to determine from the reasons whether this is because the tribunal believed this was a minor innocent error and it believed it had the discretion to ignore it or whether the tribunal failed to notice the error by ignoring the math. In the former case, the Appellant argues the tribunal erred in law and in the latter that it committed a palpable error in a finding of fact. In either case the court would be entitled to intervene on appeal.

[8] I have a statement of agreed facts in which it is admitted there is a mathematical error in the value of the election signs declared on the Form 4. Given this discrepancy on the financial statement, the limited role of the Audit Committee in screening out frivolous requests for a compliance audit, and given that both parties agree that even a de minimus reporting error may be sufficient to trigger the obligation of the Committee to order an audit, I find that the Audit Committee was in error in not ordering a compliance audit.

[9] At this stage, neither the Committee nor this Court is making a finding that there was any form of wrongdoing on the part of the candidate. As outlined by Justice Somji in Thompson and in the various cases cited by her, this is a three part process. If a compliance audit is conducted then based on the results of that audit, the Committee may authorize a prosecution. It would then be for the Ontario Court of Justice to determine if an offence has occurred. It is neither necessary nor appropriate for the tribunal or the court to believe the candidate is guilty of an offence in order to require a compliance audit. A breach of the requirement for accurate financial reporting is sufficient basis to accept the complainant’s request for an audit.

[10] For these reasons I find that the ECAC was in error and should have ordered an audit.

[11] Pursuant to s. 88.33(9) of the Act, if the Court finds the ECAC was in error, the Court is authorized to “make any decision the Committee could have made”. That is the remedy sought by the Appellant. Accordingly I am ordering a compliance audit and directing the ECAC to appoint an auditor under s. 88.33(10) of the Act.

[12] The parties agreed there should be no order as to costs, so no costs are awarded.

C. MacLeod
Date: 2025-02-21

Notes

[1] S.O. 1996, c. 32, Sched, as amended
[2] 2025 ONSC 682
[3] Note that the parties in this case are the complainant whose complaint was rejected and the tribunal but not the candidate whose election finances are under proposed scrutiny. Counsel for the tribunal took no position on the merits of the decision but did provide submissions on the legal framework and the test to be applied by the court. The candidate was neither present nor represented.
[4] It is for this reason that in Thompson the candidate was the Appellant while in this case it is the original complainant who appeals against the rejection of his complaint.
[5] See Jackson v. Vaughan (City)