levant v the world - 2003

8/17/2019 Levant v the World - 2003

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Action No.: 0301- O^it

IN THE COURT OF QUEEN'S BENCH OF ALBERTA

JUDICIAL CENTRE OF CALGARY

BETWEEN:

MICHAEL COOPER, EZRA LEVANT, MARVIN LEVANT and SEAN McKINSLEY

Plaintiffs

- and -

GARRY HENNAN, JOHN FLYNN, WALTER WAKULA and JOHN DOES and/or

JANE DOES 1 THROUGH 250

Defendants

STATEMENT OF CLAIM

1. The Plaintiff Michael Cooper (hereinafter "Cooper") is a resident of the

City of St. Albert, in the Province of Alberta. He is a university student, a

political organizer and an elected National Councilor of the Canadian Alliance

party (hereinafter the "Party").

2. The Plaintiff Ezra Levant (hereinafter "Levant") is a resident of Calgary, in

the Province of Alberta. He is a lawyer, journalist, author and political activist.

From August, 2001 to March, 2002 he was a political organizer in the Party's

Calgary Southwest constituency association (hereinafter the "Riding"). During

February and March, 2002, he was the Party candidate in the Calgary

Southwest federal by-election, later stepping aside for Stephen Harper, the

Parry's new leader (hereinafter "Harper"). From March, 2002 until April, 2003

Levant served as a director of the Riding.

3. The Plaintiff Marvin Levant (hereinafter "Dr. Levant") is a resident of

Calgary, in the Province of Alberta. He is a medical doctor and a prominent

member of the community. From August, 2001 to March, 2002 he was a

political organizer in the Riding. From November, 2001 until April, 2003 he

served as a director of the Riding.


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4.

The Plaintiff Sean McKinsley (hereinafter "McKinsley") is a resident of

Calgary, in the Province of Alberta. He is a businessman, political organizer

and pollster. From August, 2001 to March, 2002 he served as campaign

manager for Levant and was a political organizer in the Riding. From January,

2002 until March, 2002 he also served as campaign manager for the Riding m

the Calgary Southwest by-election.

5. The Defendant Garry Hennan (hereinafter "Hennan") is a resident of

Calgary, in the Province of Alberta. He served as a director of the Riding until

being voted out in November, 2001.

6. The Defendant John Flynn (hereinafter "Flynn") is a resident of Calgary,

in the Province of Alberta. He served as a director of the Riding from about late

2002 until June, 2003. From April, 2003 until June, 2003 he was president of

the Riding.

7. The Defendant Walter Wakula (hereinafter "Wakula") is a resident of

Calgary, in the Province of Alberta. He is a member of the Party, but not a

member of the Riding. He is the president of the Parry's Calgary West

constituency association (hereinafter "Calgary West").

8. The true names of the Defendants named herein as John Does and/or

Jane Does 1 through 250 are unknown to the Plaintiffs who therefore sue them

by such fictitious names. These Defendants participated in and propagated the

defamation of the Plaintiffs as alleged herein. The Plaintiffs will amend this

claim to show their true identities and to further particularize their conduct

when same have been ascertained.

9. After Levant stepped aside for Harper as the Riding's by-election

candidate, the Riding retained a professional, independent auditor to review

the Riding financial accounts and related governance issues during the period

of Levant's candidacy. Upon completion of the audit, the auditor made an

extended presentation to the Riding at a board meeting. The report was


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oTz;: rrr1"*cudng Harpervoted tossue **——

hanks to the campaign team, including the Plaintiffs.

10. Additionally, the Riding's audit as well * "d in ̂ face °f *" *»>. **

efendant, have repeatedly published or spoken defamatoxy untruths about

*e Plamnffs regarding the matters treated in the audi, Over the past year the

Decants have publicly threatened to embarrass the Plaintiffs or any of *emnd communicated this threat to Party and Riding officials.

14. In response, Party and Riding officials have constantly referred the

r̂rr* process descrbed ̂ -d—- —-

c o n t i n u e t o d o s o . ^ ^ ^ * * * ^ * * ™ * » « *

15. On or about the 17* day of December, 2002, the Defendants or any of

them, published a letter, addressed to the Secretary •*

" lu tne secretariat committee of the Party,


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governing National Council (hereinafter the "December 17th Letter"). The

December 17* Letter was also circulated widely to other people across Canada,

including to thousands of members of the Party, to people who were not

members of the Party, and to various news media. The December 17th Letter is

attached hereto and marked as Exhibit A. It is false, and defamatory of the

Plaintiffs.

16. On or about the 24th day of January, 2003, the Defendants, or any of

them, published another letter, addressed to Terry Horkoff, the Executive

Director of the Party (hereinafter "Horkoff"). This letter is hereinafter referred to

as the January 24th Letter.

17. The January 24th Letter was also circulated widely to other people across

Canada, including to thousands of members of the Party, to people who were

not members of the Party, and to various news media. The January 24th Letter

included within its body a copy of the December 17th Letter, as well as certain

additional documents listed within its text, and is attached hereto and marked

as Exhibit B. It is false, and defamatory of the Plaintiffs.

18. On or about the 19th day of May, 2003, the Defendants, or any of them,

published another letter, addressed to "Canadian Alliance Friends" (hereinafter

the "May 19th Letter"). Hennan published the May'19th Letter as an attachment

to an E-mail sent to numerous people (hereinafter the "May 19th Hennan E-

mail"), including the following Party National Councilors who are resident

across Canada:

a. James Carson;

b. Don Irwin;

c. Aria Taylor;

d. Robert Alexander;

e. Michael Cooper (a Plaintiff herein);

f. Doug Sharpe;


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g.

Jeremy Harrison:

h.

Sam Magnus;

i.

Eric Schenstead;

J

Ed Agnew;

k. Don Plett;

1

Denis Simard;

m. Pat Dunn;

n.

Nancy Jahn; and

0 .

David Leskowski.

19. The subject title of the May 19* Hennan E-mail containing the May 19*

Letter was "Complaints of Misconduct in Calgary Southwest", and it was sent

from Hennan's E-mail account, namely [email protected]. It is defamatory of

the Plaintiffs.

20. In addition to the May 19* Letter, the May 19* Hennan E-mail also

contained the following words in the body of the E-mail itself, which were false,

and defamatory of the Plaintiffs:

"To Members of National Council,

As a very long time member of the Reform - Alliance Party in Canada, I would

like you to teU me if any of you knew about the serious allegations in the

attached documents prior to this release, and, if so, WHY HAS IT BEEN SWEPT

UNDER THE CARPET?

It appears as if all of this has taken place RIGHT UNDER OUR LEADER'S

NOSE If we cannot deal with conduct like this in our own party, how do you

expect to run the affairs of an entire country with the honesty and integrity we

have promoted over the years?

I must say, ever since Preston Manning stepped down (or was forced out), this

parry has been lowered to the same level as all the rest of them.

Garry Hennan,

Member since 1991,


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Calgary Southwest"

21. In addition, the Defendants, or any of them, circulated the May 19*

Letter widely to people across Canada, including to thousands of members of

the Party, to people who were not members of the party, and to various news

media.

22. The May 19* Letter included within its body copies of the December 17*

Letter and January 24* Letter, and is attached hereto and marked as Exhibit

C. It is false, and defamatory of the Plaintiffs.

23. On or about the 21st day 0f May> 2003, the Defendants, or any of them,

published another letter (hereinafter the "May 21st Letter") and sent it by E-

mail to thousands of members of the Party across Canada, to people who were

not members of the Party, and to various news media. The May 21st Letter

included an attached document, which included within its body a copy of the

December 17* Letter and January 24* Letter, and added to those a preface

and postscript similar to that of the May 19* Letter, but with an increasingly

defamatory and malicious tone and with more incendiary language. The May

21st Letter is attached hereto and marked as Exhibit D. It is false, and

defamatory of the Plaintiffs.

24. The May 21st Letter was E-mailed from an anonymous E-mail account

which disguised the true identity of the E-mail's sender, appearing to be sent

i n s t e a d f r o m t h e a l i a s " C o n c e r n e d . A l l i a n c e . M e m b e r s . -

.Please.Act.Now @domain.com."

25. The May 21* Letter's E-mail subject title was "Wrongdoing in Calgary

Southwest Must Be Investigated."

26. In addition to the aforementioned attached document, fictitious identity

and subject title, the May 21* Letter also contained the following words in the

body of the E-mail itself:

"Dear Alliance Friend,


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Kto ̂ SiSf06 Tmbfruand Care ab0Ut HONESTY and INTEGRITY

totoSŜSŜ ** attached me ̂FORWARDIT TO ^

S y i ^ s y r s

jSxSTSS Wonnh,antdeUvered t0 the Executive Director of the party on

SSat Sr, t^ ' I0" Unmediate del ive iy to the Nat ional cSunc™

havrSn iiored not?' T T^* C°nCemS °f ahnost 200 member*

SicateS irfthi r"„ f-"f h&S been d°ne Meanwhile the very same people

Sfr ? Complaint are trying to secure control of other ridings -most

SSSSS Cntre' ^ * W°n,t St°P therd 0thCr ridmSS will^oonbe1

1TstSLp^E^?ut the core values that brought many of

S TO THIS PARTY - HONESTY AND INTEGRITY - PLEASE HELP

d „ x e s £ s s r ™ s h o u l d s ™ ™ ™ » ~ ™ c s

Thank you.

5'^1rThe att*chn)ent contains a Member Advisory dated May 2003 a conv

Note#2: File transfer size limits makes it impossible to include «n rtw

t S t o Z Z S F Z Z ? ? ° I t h e T f 3 1 r e f e r ^ C e d - a t t a ' h r n e n t s l o £

S e c r e t a ^ S p a ^ ^ c u V e X t c t r " * * ^ " ^ C ° ^ '

27. On or about the 20* day of May, 2003, Hennan published the May 19*

Letter as an attachment to an E-mail sent to Paul Jackson, a senior columnist

with the Calgary Sun newspaper (hereinafter the "May 20* Hennan E-mail")

On or about the 27- day of May, 2003, Hennan published another E-mail to

Paul Jackson (hereinafter the "May 27* Hennan E-mail", referring to the May

20- Hennan E-mail. Both of these E-mails were false, and defamatory of the

Plaintiffs.


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28. The subject title of the May 20* Hennan E-mail was "Joel Loh May Not

Make It The Way You Think", and the E-mail was sent from Hennan's E-mail

account, namely [email protected].

29. The May 27* Hennan E-mail also contained the following words in the

body of the E-mail itself:

"Hello Paul,

Do you recall the document package I sent to you last week regarding the

problems in Calgary Southwest? Well, both your rising stars Joel and Ezra are

front and centre in this controversy and formal complaint now in the hands of

the Alliance Party National Council.

In fact, there is a more than even chance that Joel may have to withdraw from

his bid for Calgary Centre. The nomination selection committee is having

second thoughts about Mr. Loh now that they have additional information on

his background as former treasurer and president of Calgary Southwest

Constituency Association.

This places you in a difficult position. However, you may send any portion of

your Mexican retirement fund you like to my attention (as noted in your May

27th column). I am calling you on your bet.

Garry Hennan,

Alliance Member,

Calgary Southwest,

680-5735"

30. On or about the 20* day of May, 2003, Wakula published an E-mail sent

to numerous people (hereinafter the "May 20* Wakula E-mail"), including to

Terry Horkoff, the Party's executive director (hereinafter "Horkoff), and Linda

Toews, the party's Southern Alberta volunteer coordinator (hereinafter

"Toews"). This E-mail was false, and defamatory of the Plaintiffs.

31. The subject title of the May 20* Wakula E-mail was "Re: Wrongdoing in

Calgary Southwest", and the E-mail was sent from Wakula's E-mail account,

namely [email protected].


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32. The May 20* Wakula E-mail contained the following words in the body of

the E-mail itself (including original typographical errors):

"Dear Concerned Alliance Members, Terry and Linda,

I continue to be amazed at the lack of financial control and poor governance of

some constituency associations, Calgary Southwest in particular, and the lack

of fundamental decency and pure ambition of some people. I have seen some

"Gong shows" but this one surely takes the cake.

However, when all is said and done, this appears to me to be a Calgary

Southwest matter and a forensic audit appears warranted with results reported

at a spacial meeting of the members. My wonder is why a special meeting of the

members has not already been called to deal with the matter and pass a special

resolution to ask National Council for help rather than rallying people from

other ridings.

Though a Calgary Southwest matter, I am concerned of the spillover effects this

matter may have in the rest of Calgary and, indeed, for the party overall if these

allegations get into the press and especially if litigation is launched. On that

basis, I ask that this matter be put on the SACC agenda for June.

Best regards,

Walter Wakula, President

Calgary West Constituency Association

Canadian Alliance

Phone: 246-9290"

33. In or about May, 2003, Flynn published the May 21*t Letter as an

attachment to an E-mail sent to numerous people (hereinafter the "Flynn E-

mail"), including to the entire board of directors of the Riding.

34. On or about the 27* day of May, 2003, Wakula published the May 21st

Letter as an attachment to an E-mail sent to numerous people (hereinafter the

"May 27* Wakula E-mail"), including to the entire board of directors of Calgary-

West. The E-mail was false, and defamatory of the Plaintiffs.

35. The subject title of the May 27* Wakula E-mail containing the May 21s*

Letter was "Alliance Party News - Issue No. 26", and the E-mail was sent from

Wakula's E-mail account, namely [email protected].


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36. In addition to the May 21st Letter, the May 27* Wakula E-mail also

contained the following words in the body of the E-mail itself:

"Fellow Directors,

Attached are the latest party announcements and sampling of news that I have

received since my Alliance Party News Issue No. 25 about 2 weeks ago.

Significant items among these are:

1. Calgary Center and Calgary SE are looking for volunteers for their

Candidate Selection Meetings (May 31, June 4 and 14) See attached

Email for details.

2. There's a few Canadian Alliance Advocates attached including a special

edition

3. Wrongdoing in Calgary SW is a case study in lax financial controls and

poor governance of a constituency association.

Enjoy.

As usual, if you don't want to receive these Alliance Party News Emails, please

let me know and 111 take you off the list.

Best regards,



Canadian Alliance

Phone: 246-9290"

37. On or about the 6* day of June, 2003, Wakula published an E-mail sent

to numerous people (hereinafter the "June 6* Wakula E-mail"), including to

Horkoff, Toews, and members of the Calgary West's executive committee. The

E-mail was false, and defamatory of the Plaintiffs.

38. The subject title of the June 6* Wakula E-mail was "Fw: Wrongdoing in

Calgary Southwest", and the E-mail was sent from Wakula's E-mail account,


39. The June 6* Wakula E-mail repeated the entire May 20* Wakula E-mail,

and also contained the following additional defamatory words in the body of the

E-mail itself (including original typographical errors):


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"John,

I had responded to your "Wrongdoing ..." Email copying Terry Horkoff and

Linda Toews but the return Email copy to your group bounced.

I just re-read the Email from your "Please Act Now" group and am forwarding

my response, below, made a couple of weeks ago. I understand that you are

being pressured to not pursue an audit by senior members of the Alliance. I

can understand why the Alberta National Councilors are against such an audit

but don't understand why Terry and other senior Alliance officials are against

it. My previous Email comments below also apply.

My position with managing other people's money is always to err on the side of

tranparency, especially when there appears to be malfeasance as your group

alleges. It may just be gross incompetence or naivety of that Board which,

though reprehensible and not financially prudent, would not otherwise be

illegal. If funds were misappropriated by the constituency to pay for a national

councillor election campaign then I believe erring on the side of transparency is

again preferable so the consequences of that can properly be dealt with by the

Alliance.

On the basis of these points I would support a forensic audit being undertaken

so that you can provide a proper financial report to your members. If your

riding is like mine there have been hunderds of $25 donations by poeple who

are strong believers but who can't really afford the donation and don't even

qualify for the tax receipt.

However, extending the audit to a lawyers trust account, over his objections,

may involve obtaining a court order and going through that process, which

could include litigation. This may be a reason for senior Alliance resistance to

such an audit.

I have put this item on tomorrow's SACC agenda despite Terry's objections

and hope to understand the matter better after our discussion.

Best regards,



Canadian Alliance

Phone: 246-9290"

40. On or about the 5* of June, 2003, Flynn chaired a meeting of the Riding.

At that meeting, the auditor who audited the Riding's financial accounts in the

spring of 2002 presented his findings again, in rebuttal to the May 2 l*t Letter.


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41. Two days later, on or about the 7* of June, 2003, Flynn attended a

meeting of Party constituency association presidents and other Party officials

from across southern Alberta (the "June 7* Meeting"). At the June 7* Meeting,

Flynn orally repeated the defamatory words, or any of them, contained within

the May 21st Letter, and encouraged other Party officials from across Alberta to

read and believe the May 21st Letter and to officiously launch another audit

into the matters alleged therein. He did so despite having heard the true facts

of the matter from the auditor just two days previously.

42. At the June 7* Meeting, Flynn described Party officials, including

Harper, who were not receptive to this new audit proposal as "cockroaches."

The exact defamatory words used by Flynn at the June 7* Meeting (hereinafter

"June 7* Alberta Meeting Statements") are unknown to the Plaintiffs who will

amend this claim as may be necessary to particularize them when same have

been ascertained. The statements were false, and defamatory of the Plaintiffs.

43. On or about the 7* day of June, 2003, as a result of the June 7* Alberta

Meeting Statements, Harper telephoned Flynn to ask him to resign as president

of the Riding. Following that telephone call, Flynn published an E-mail sent to

numerous people (hereinafter the "June 7* Flynn E-mail"), including to Toews,

Robert Harper (Harper's brother), Ray Novak (Harper's assistant), members of

Calgary West, and members of the Riding. The E-mail was false, and


44. The subject title of the June 7* Flynn E-mail was "Jabs from the

Leader", and the E-mail was sent from one of Flynn's E-mail accounts, namely

[email protected].

45. The June 7* Flynn E-mail contained the following words in the body of


"Mr. Harper,

This afternoon, you had phoned my home and our telephone conversation

ended abruptly. You have interpreted my words as a resignation. Firstly I did

not use the word "resign". Secondly, I do not resign to you. I will resign to the


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Board on my terms. Again, I find it appalling that you continue to believe that

you run this Constituency Association. This constituency association is not

yours . You have forgotten that this is a grassroots party with a Constitution.

You had called to tell me that there have been many complaints from National

Council and from Calgary SW Board members about my conduct. You would

not name them for me. (I have also heard that you are not happy with my

stance on this issue and plan on removing me anywayJ.Of course, our members

are quite aware of the two local National Councillors involved. Many could

question their conduct. I know our SW Board members have been called by

your associates. Again, inappropriate conduct. I can say, after the Southern

Aiberta Constituency Council meeting today, that I would have the full support

of all Constituency Presidents in Southern Alberta.

No one can understand why you will not properly and professionally deal with

m^ jerysenous allegations against this riding. It has been one year and

nothing has happened. You have told me that it is not our problem. You have

also said that National Office is dealing with it. I strongly disagree on both of

those statements. This Calgary SW Constituency Association will not be moving

forward until the Complaint against this Association is properly handled There

is also spill over to other ridings. This issue can damage the parry.

Th%?alffry SW Board wiU now have t0 decide whether to call for a forensic

audit Many other Constituency Presidents agree. Maybe an Elections

Canada/Revenue Canada audit would be the best since it would save the

Board a lot of money which we do not have in our account.

I believe I speak for many individual members of this party when I say ... it is

time for some leadership on this issue.

Regards,

John Flynn

President

Calgary SW"

46. On or about the 8* day of June, 2003, Wakula published two defamatory

memoranda, by sending them by E-mail (hereinafter the "First June 8* Wakula

Memo" and the "Second June 8* Wakula Memo"). The First June 8* Wakula

Memo was sent to numerous people, including to Don Plett (the president of

the Party), Harper, Flynn, Horkoff, Gus Barron (the president of the Party's

Calgary Centre constituency association, hereinafter "Barron") and the

executive committee of Calgary West. The Second June 8* Wakula Memo was

sent to the same people, except Horkoff. The First June 8* Wakula Memo is


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attached hereto and marked as Exhibit E. The Second June 8* Wakula Memo

is attached hereto and marked as Exhibit F. Both memoranda are false, and


47. On or about the 9* day of June, 2003, Flynn published an E-mail sent to

numerous people (hereinafter the "June 9* Flynn E-mail"), including to

Wakula. The E-mail was false, and defamatory of the Plaintiffs.

48. The subject title of the June 9* Flynn E-mail was "Re: Solutions For The

Calgary Problem", and the E-mail was sent from one of Flynn's E-mail

accounts, namely [email protected].

49. The June 9* Flynn E-mail contained the following words in the body of


"Walter,

I submitted my resignation to the SW board. (What is left of it).There were

people operating behind my back to undermine me and they plan on lynching

me tomorrow anyway.

For your eyes only, Yesterday, I received the typical telephone call/blackmail

attempt.

Of course, I am not entirely scared by this action. I would love to stay and fight.

I am very concerned about my elevated anger and blood pressure.

Having been a member for many years, I also have a really hard time justifying

an enormous amount of my time to clean up this huge mess that was created

by many others who have all been promoted into this party.

Amazing destroy a riding association and get promoted??

I honestly thought that Harper was a better man than Chretien. I do not want

to be a part of the New Liberal Party.

Sincerely,

John Flynn"

50. On or about the 15* day of June, 2003, the Defendants, or any of them,

attended a meeting of Party constituency association presidents, volunteers,

Members of Parliament and senior Party officers, including the Party's national

president, national secretary and senior advisors to Harper (hereinafter the

"June 15* Alberta Meeting"). At the June 15* Alberta Meeting, the Defendants,

including Wakula, orally defamed the Plaintiffs (hereinafter the "June 15*


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Alberta Meeting Statements") including repeating words from the May 21st

Letter.

51. On or about the 16* day of June, 2003, Wakula published an E-mail

sent to numerous people (hereinafter the "First June 16* Wakula E-mail"),

including to Linda Slobodian, a reporter and columnist with the Calgary

Herald, the Letters Editor of the Calgary Herald, Barron, and Jim Stevenson,

president of the Party's Calgary Northeast constituency association. The E-mail

was false, and defamatory of the Plaintiffs.

52. The subject title of the First June 16* Wakula E-mail was "Canadian

Alliance - Meeting fails to mend rift over riding vote", and the E-mail was sent

from Wakula's E-mail account, namely [email protected].

53. The First June 16* Wakula E-mail contained the following words in the

body of the E-mail itself (including original typographical errors and use of bold

text):

"Re: Canadian Alliance - Meeting fails to mend rift over riding vote

June 16, 2003 by Linda Slobodian

I was disappointed to read in this article that Gus Barron, President of Calgary

Centre Alliance, believes that nothing was accomplished at Sunday's meeting of

Southern Alberta Alliance MPs, Presidents and National Council Executive. On

the contrary, the objectives of the meeting were to hear National Council's

viewpoint and rationale for decisions taken by it on the Calgary situation and

to discuss and provide feedback from Southern Alberta MPs and Presidents on

this situation. A further objective of the Presidents was to encourage National

Council to work with riding officials to bring about a quick, transparent and

fair resolution to the controversy currently engulfing Calgary Southwest and

Calgary Centre Constituency Associations.

In my opinion the Executive of National Council undertook to do just that.

Council President Don Plett committed to provide a report on Calgary

Southwest finances within 10 to 14 days. Council also delegated to an Offficer

of council responsibilty to investigate the Candidate Selection process in

Calgary Centre with a view to resolve the impasse and move forward quickly

with a solution acceptable to the Board and the three candidates. I felt we left

the meeting upbeat and confident that all sides had discussed the issues

openly and honestly and that our objectives had been substantially achieved.

Best regards,


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Walter Wakula, MBA

President


Canadian Alliance

143 Windermere Road S.W.

Calgary, AB

T3C 3K9

Phone: (403) 246-9290

Cell: (403) 816-6206"

54. On or about the 16* day of June, 2003, Wakula published another E-

mail sent to numerous people (hereinafter the "Second June 16* Wakula E-

mail"), including to the entire board of directors of Calgary West. The E-mail

was false, and defamatory of the Plaintiffs.

55. The subject title of the Second June 16* Wakula E-mail was "My Letter

to the Herald Editor Re; Calgary SW & Centre", and the E-mail was sent from

Wakula's E-mail account, namely [email protected].

56. The Second June 16* Wakula E-mail contained within its body an exact

copy of the First June 16th Wakula E-mail and the following additional words

(including original typographical errors):

"Fellow Directors,

I had believed that the problems in Calgary SW and Calgary Center were

problems that needed to be solved by their Boards and members. However,

after last week's Southern Alberta Constituency Council ("SACC") meeting I

was appalled to learn more about the serious allegations being circulated, was

concerned about the threats of litigation against those volunteers providing

evidence of alleged malfeasance and was concerned about the effect these

matters may have on Calgary West and other Southern Alberta constituencies.

Because of these factors I moved a motion in SACC for SACC to arrange a

meeting with Don Plett, President of National Council, and his executive before

they left town on Sunday.

Following up on that motion I wanted you to be aware that I was one of the

organizers of a joint meeting among SACC, National Council Executive and the

Calgary area MPs held Sunday morning, June 15, 2003. It was important to us

to get National Council more informed on the issues and to urge them to work

with riding officials to bring about a quick, transparant and fair resolution to

the controversy. Further, I emphasized to the meeting that a high priority be

given to this by Council for a number of reasons not the least of which is that


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23 percent of the membership of the Alliance is represented by SACC. A

problem spreading in Calgary less than a year before the next election has, in

the opinion of several presidents, the potential to erode a substantial base of

the party, especially if hostile Board takeovers domino into more Calgary area

ridings.

I thought the concensus of the Sunday morning meeting was upbeat and that

the issues had been discussed openly and honestly and that Council had

committed to proceed quickly and openly to resolve the disputes. I woke up to a

Herald article stating that Gus Barron, President of Calgary Centre, disagrees.

Accordingly, I have written the following letter to the editor of the Herald. I

would appreciate any comments you may have on this.

Best regards,



Canadian Alliance

Phone: 246-9290"

57. On or about the 18* day of June, 2003, Wakula published an E-mail

sent to numerous people (hereinafter the "June 18* Wakula E-mail"), including

to the entire board of directors of Calgary West. The E-mail was false, and


58. The subject title of the June 18* Wakula E-mail was "Alliance Party

News - Issue No. 27", and the E-mail was sent from Wakula's E-mail account,


59. The June 18* Wakula E-mail included, as attachments, an exact copy of

the May 20* Wakula Letter, the June 6* Wakula E-mail, the June 7* Flynn

Letter, the First June 8* Wakula Memo and the Second June 8* Wakula

Memo.

60. On or about the 19* day of June, 2003, the Defendants, or any of them,

sent the May 21st Letter, including the names of 177 of the Defendants referred

to herein as John Does and Jane Does, to the National Post newspaper's

Ottawa bureau.

61. The defamatory written documents referred to in paragraphs 15 through

60 and the Exhibits thereto are hereinafter referred to collectively as the


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"Letters". The defamatory oral statements referred to in paragraphs 15 through

60 are hereinafter referred to collectively as the "Statements."

62. The Plaintiffs state that they are the persons referred to in the Letters

and the Statements. Their identify is readily apparent to readers of the Letters

and those who heard the Statements, especially to members of the Party and

the Riding, even though euphemisms and pronouns are generally used in the

Letter instead of the Plaintiffs' names. As well, many people who are not

members of the Party but who follow the news, as well as members of the news

media, other political activists, clients, patients, friends and other associates of

the Plaintiffs would identify the Plaintiffs as the persons defamed in the Letters

and the Statements.

63. The Letters and the Statements could not be referring to anyone else but

the Plaintiffs.

64. In particular, Cooper is well-known as a National Council candidate and

member of the "PAL* Party slate referred to in the Letters and the Statements

Every member of the Party, especially those in Alberta, has received several

letters, both from the Party and from Cooper, to that effect. All references to

PAL", "PAT or National Council elections refer to him. As well, Cooper was the

recipient of a $500 fee for service on the campaign. By implying that this $500

payment was inappropriate, the Defendants again clearly identify and defame

Cooper.

65. In particular, Levant is well-known as the candidate referred to

throughout the Letters and the Statements, and as the author of various

brochures and correspondences referred to therein, including fundraising

appeals, and the host of various fundraising events referred to therein

Members of the Party, especially those in the Riding, would have known that

fact, not only from media coverage but from several letters, brochures and

telephone messages from the Parry and Levant himself. Levant's candidacy is

also well-known to the news media, political activists, lawyers, the Jewish


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community and the public in general, especially in Alberta, Toronto, Ottawa

and nationally.

66. In particular, Dr. Levant is well-known as a director of the board of the

Riding and a leading volunteer in and organizer of Levant's campaign activities

referred to throughout the Letters and the Statements. Members of the Party

and others, especially those in the Riding, would have known that fact, not

only from media coverage but from a letter sent to hundreds of Alberta doctors

by Dr. Levant. Dr. Levant's involvement is also well-known to Harper, and to

other Members of Parliament, the news media, political activists, the Jewish

community and the public in general.

67. In particular, McKinsley is well-known as the businessman, campaign

manager and general political and financial organizer referred to throughout

the Letters and the Statements. Members of the Party, especially those in the

Riding, would have known that fact. As campaign manager and a guest at

many Riding meetings, McKinsley is well known to Party volunteers including

Riding board members and Harper. McKinsley is also well-known within the

Party in general and the general business, news media and political

community.

68. The Plaintiffs claim that the Letters and the Statements are false and

defamatory in their material and ordinary meaning.

69. The December 17* Letter and the Statements were meant or reasonably

understood to mean that:

a. the Plaintiffs are not honest;

b. the Plaintiffs have no integrity;

c. the Plaintiffs engage in wrongful conduct;

d. the Plaintiffs, particularly Levant, Dr. Levant and McKinsley, refuse

to make disclosures of properly disclosable information;


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e. the Plaintiffs disregard appropriate standards of conduct;

f. the Plaintiffs, particularly Levant, Dr. Levant and McKinsley ran

the Riding into the ground, into debt, and broke it;

g. the Plaintiffs are tainted;

h. Cooper was elected to National Council improperly;

i. the Plaintiffs, particularly Levant, Dr. Levant and McKinsley

improperly handled $30,000 from a December, 2001 fundraising

dinner that should have been deposited with the Riding;

j. the Plaintiffs, particularly Levant, Dr. Levant and McKinsley did

not contribute to the election campaign, after promising to do so;

k. the Plaintiffs engaged in fundraising tactics that are contrary to the

Party's policy, and that the Party has criticized in Parliament;

1. Levant and McKinsley misled the Party into paying inappropriate

or personal debts;

m. the Plaintiffs inappropriately used Party funds to pay for Cooper's

election campaign for National Council, including inappropriate

use of postage, photocopying, printing and telephones;

n. the electoral results at the Riding's Annual General Meeting in

November, 2001, including Dr. Levant's election to the board, were

not legitimate, but rather the result of a hostile act by the

Plaintiffs;

o. Party funds were inappropriately used to recoup costs for personal

expenses of the Plaintiffs, particularly Levant;

p. Riding funds were used to pay an election deposit for Cooper;


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q. McKinsley inappropriately paid fundraising commissions, and

funds raised through those commissions were inappropriately

spent;

r. Levant inappropriately received a candidate refund twice;

s. cash donations were improperly accounted for by the Plaintiffs;

t. Riding funds were turned over by Dr. Levant to Levant or

McKinsley without authority, prematurely, and without arms-

length controls;

u. Levant and McKinsley inappropriately had early access to the Party

membership list, and continue to use it improperly;

v. Levant's choice of an official agent was inappropriate and illegal;

w. the Plaintiffs have breached their fiduciary duties to Party

members in the Riding;

x. $50,000 of Party money was improperly and unaccountably

transferred by the Plaintiffs to a lawyer's trust fund;

y. the Plaintiffs have improperly kept or converted property belonging

to the Riding;

z. McKinsley improperly enriched himself by giving himself or his

company $40,000 from Party funds;

aa. McKinsley has received money from the Riding without proper

accounting;

bb. Levant and McKinsley improperly acquired durable assets

purchased by the Riding, and did not meet their fiduciary duties;

cc. the Plaintiffs conduct warrants a professional investigation, or an

additional professional investigation;


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dd. the Plaintiffs conduct warrants a criminal investigation, have

conducted themselves illegally, and are criminals; and

ee. the Plaintiffs are deserving of sanction by the Party.

70. In addition to the meaning of the December 17* Letter, which was

repeated in the January 24* Letter, the January 24* Letter and the

Statements also were meant or reasonably understood to mean that:

a. the Plaintiffs are vexatious and frivolous litigants who abuse the

court system; and

b. the Plaintiffs are controlling the Riding and the Party and are

refusing to allow proper investigations or complaints to be made.

71. In addition to the meaning of the December 17* Letter and the January

24* Letter, which was repeated in the May 19* Letter, the May 19* Letter and

the Statements also were meant or reasonably understood to mean that:

a. the Plaintiffs were not being honest;

b. the Plaintiffs have no integrity;

c. the Plaintiffs are corrupt and engage in corruption, and do so

blatantly;

d. the Plaintiffs engage in questionable, intolerable and shocking

conduct;

e. the Plaintiffs are scandalous, and attempt to cover up their

scandals;

f. the Plaintiffs throw away money belonging to the Party;

g. the Plaintiffs engage in deceitful behaviour, and deceive Party

members throughout Calgary;


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h. the Plaintiffs siphon money out of Party coffers, and do so

inappropriately and secretly;

i. the Plaintiffs improperly enrich themselves and personally benefit

from property that belonged to or ought to have belonged to the

Party;

j. the Plaintiffs misappropriate money that was supposed to go to

fight the Liberal party;

k. the Plaintiffs violate conflict of interest guidelines;

1

McKinsley grants himself contracts, with Levant's approval, and

both do so inappropriately;

m. the Plaintiffs are discreditable;

n. the Plaintiffs have been implicated by these accusations;

o.

the Plaintiffs make the Party a corrupt imitation of the Liberals;

and

p. the Plaintiffs are generally disreputable, odious and worthy of

contempt.

72. In addition to the meaning of the December 17* Letter, the January 24*

Letter and elements of the May 19* Letter which were repeated in the May 19*

Letter, the May 21st Letter and the Statements also were meant or reasonably

understood to mean that:

a. the Plaintiffs are committing or are about to commit misconduct in

the Party's Calgary Centre constituency association, and

potentially elsewhere, and that the Party's finances are nowhere

safe from the Plaintiffs;

b. the Plaintiffs and their conduct are like a cancer; and


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c. Levant was not properly scrutinized by the Party before becoming

the Riding's candidate, and that he was and is not fit to become

the candidate.

73. The May 21« Letter and the Statements contained adjectives and adverbs

throughout which served to emphasize the defamation by portraying the

Plaintiffs conduct as superlatively disreputable.

74. The May 20* Hennan E-mail and the Statements were meant or

reasonably understood to mean that:

a. the allegations outlined in the Letters were true;

b. wrongdoing by Plaintiffs had been covered up;

c. the Plaintiffs and their conduct lacked honesty and integrity; and

d. the Plaintiffs had lowered the moral character of the Party.

75. The May 20* Hennan E-mail, the May 27* Hennan E-mail and the

Statements were meant or reasonably understood to mean that:

a. Levant's career as a rising star is over, or ought to be over; and

b. anyone associated with the Plaintiffs is of dubious character.

76. The May 20* Wakula E-mail and the Statements were meant or

reasonably understood to mean that:

a. it was an established fact that the Plaintiffs committed wrongdoing

in the Riding; and

b. any wrongdoing was the result of laxity and poor governance on

the part of the Riding's directors, including Dr. Levant.

77. The June 6* Wakula E-mail was meant or reasonably understood to

mean that:


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a. the Plaintiffs' conduct warrants a further audit, and a forensic

audit;

b. senior members of the Party are covering up the Plaintiffs' conduct;

c. the Plaintiffs mismanaged other people's money;

d. the Plaintif fs' financial dealings were not appropriately

transparent;

e. the Plaintiffs were guilty of malfeasance;

f. the Plaintiffs were guilty of gross incompetence and naivete;

g. the Plaintiffs conduct was reprehensible;

h. the Plaintiffs are not financially prudent;

i. the Plaintiffs, especially Cooper, misappropriated funds for a Party

National Council election;

j. the Plaintiffs took advantage of hundreds of hard-working people,

who can't afford it; and

k. Levant's lawyer's trust fund should be audited.

78. The June 7* Flynn E-mail was meant or reasonably understood to mean

that:

a. the Plaintiffs have been let off improperly and unprofessionally by

Harper;

b. the financial allegations against the Plaintiffs are very serious;

c. no material or real audits or investigations have been made;

d. the Party's National Office has not properly punished the Plaintiffs;


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e. the May 21st Letter has not been properly handled by the Party or

Harper;

f. the Plaintiffs' conduct is spilling over into other Party constituency

associations;

g. a forensic audit is needed, and other Party constituency

associations agree with that conclusion; and

h. the Plaintiffs' conduct is egregious enough to warrant an

investigation and audit by both Elections Canada and Revenue

Canada.

79. The First June 8* Wakula Memo was meant or reasonably understood to

mean that:

a. the Plaintiffs' conduct is appalling;

b. the allegations against the Plaintiffs are serious;

c. the Plaintiffs, especially Levant, threaten volunteers and witnesses;

d. the Plaintiffs engage in malfeasance;

e. other Party constituency associations in the Calgary area are at

risk from the Plaintiffs;

f. the Plaintiffs' conduct was not appropriately transparent;

g. the Plaintiffs, especially Dr. Levant, have not properly disclosed

financial information for three years running, and have not

complied with proper accounting procedures; and

h. the Plaintiffs' conduct warrants an audit or a forensic audit.


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80. In addition to the meaning of the First June 8* Wakula Memo, the

Second June 8* Wakula Memo was meant or reasonably understood to mean

that:

a. Cooper inappropriately funded his National Council campaign

through Riding funds; and

b. the Plaintiffs, especially Levant, bully people who seek solutions.

81. The June 9* Flynn E-mail was meant or reasonably understood to mean

that:

a. the Plaintiffs, particularly Levant, engage in blackmail;

b. the Plaintiffs have created a huge mess that needs cleaning up;

and

c. the Plaintiffs have destroyed the Riding.

82. The First June 16* Wakula E-mail and the Second June 16* Wakula E-

mail were meant or reasonably understood to mean that:

a. the Plaintiffs are controversial, and have created a situation

requiring the intervention of outside officials;

b. the Plaintiffs' conduct was appalling;

c. the Plaintiffs were threatening witnesses and others with evidence

of the Plaintiffs' malfeasance;

d. Wakula had to educate the Party's National Council about the facts

regarding the Plaintiffs;

e. the Plaintiffs represent a problem that is spreading around Calgary

and threatens to erode the Party; and


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f.

the Plaintiffs did not succeed in the Riding through democratic

means, but rather through hostile means, and threaten to do the

same in other Party constituency associations.

83. The use of capital letters, bold and underlined text in the Letters was

deliberately designed to inflict maximum damage on the Plaintiffs, by

emphasizing particularly defamatory words.

84. The Plaintiffs state that by reason of the publication of the aforesaid

Letters and Statements the Plaintiffs have been severely injured in their credit,

character, and reputation and have been brought into public scandal, odium,

and contempt, and have suffered damages.

85. The Plaintiffs claim that the Defendants acted with malice, in that the

Defendants, or any of them, had a pre-existing political hostility towards and

disagreement with the Plaintiffs, and that pre-existing hostility and

disagreement was the real motivation behind the Letters and the Statements.

86. The Plaintiffs claim that the Defendants, or some of them, continue to act

with malice, in that they continue to exhibit political hostility towards and

disagreement with the Plaintiffs, as revealed by their reference to the Calgary

Centre Party contest and other potential Party contests, and their Statements.


Defendants conducted themselves as officious intermeddlers. The Defendants

had no reasonable basis for publishing the Letters and the Statements, and

had no public or private duty or interest which obligated them to do so. Those

Defendants who live outside the Riding and who were therefore not members of

the Riding were especially officious, as were those Defendants who published

the Letters and the Statements to persons who live outside the Riding.


questions raised in the Letters and the Statements were answered exhaustively

by the auditor and by the Plaintiffs, especially by Levant and McKinsley, and


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their answers were accepted and approved by the Party and the Riding. The

Defendants persisted with their defamation despite their defamatory

complaints being rejected by the auditor, the Riding, the Party and all other

proper authorities.

89. The Defendants acted with malice, in that the Letters and the Statements

were published with reckless disregard of the truth, or fairness, or for the

Plaintiffs' reputations, as the Defendants knew the Letters and the Statements

were false.

90. Flynn acted with malice in that, just days after he heard the auditor's

report debunking the defamation described herein, Flynn attended the June 7*

Alberta Meeting and uttered the June 7* Alberta Meeting Statements.

91. The Letters and the Statements were not genuine complaints or

inquiries, but rather crude attempts to smear the Plaintiffs. The Letters and the

Statements pretend to be good faith complaints, or unprejudiced questions, but

in fact repeatedly state defamatory conclusions and false statements of fact,

and therefore are not legitimate complaints or inquiries.

92. The Plaintiffs state that the anonymous nature of the Letters reveals the

malicious and sneaky mindset of the Defendants and their knowledge that they

were not making genuine complaints.

93. The Plaintiffs state that none of the Defendants ever contacted the

Plaintiffs, or any of them, for an explanation or response to the questions posed

in the Letters and the Statements, and that this omission is a sign of bad faith

and malice.

94. The Plaintiffs state that, by organizing approximately 200 co-signers to

the Letters, the Defendants were not actually interested in a formal complaint,

put discreetly and properly to the Party's appropriate committee, but rather

were interested in drumming up a public scandal and circulating the rumours


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contained in the Letters as widely as possible, including to people who had no

business receiving them.

95. The Letters and the Statements contain exhortations to all recipients of

the Letters to forward and republish the Letters to others indiscriminately, and

this is an act of malice.

96. The Plaintiffs also claim that the Letters and Statements imputed

dishonourable motives to the Plaintiffs, and this is an act of malice.

97. Cooper states that the Letters and the Statements were particularly

damaging to him, as he is a National Councilor of the Party whose reputation

in the Party, the news media, at university and in the community at large, was

severely damaged by accusations of corruption and other malfeasance and

improper or illegal conduct.

98. Levant states that the Letters and the Statements were particularly

damaging to him, as he is a lawyer whose reputation with his firm, colleagues,

judges, clients and potential clients and the Law Society of Alberta was severely

damaged by accusations of corruption and other malfeasance and improper or

illegal conduct.

99. Levant further states that the Letters and the Statements were

particularly damaging to him, as he is a newspaper columnist and author

whose public reputation in the community at large, with the newspapers that

publish him, with his readers and with book-buyers was severely damaged by

accusations of corruption and other malfeasance and improper or illegal

conduct.

100. Levant further states that the Letters and the Statements were

particularly damaging to him, as he is a political organizer and was a director

of the Riding whose public reputation in the voting public at large, with the

Riding, with others within the Party and with the news media was severely


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damaged by accusations of corruption, other malfeasance and improper or

illegal conduct.

101. Dr. Levant states that the Letters and the Statements were particularly

damaging to him, as he is a prominent medical doctor whose public reputation

amongst other doctors, medical staff, current and prospective patients, health

administrators and the College of Physicians and Surgeons of Alberta, the news

media and the public at large was severely damaged by accusations of

corruption, other malfeasance and improper or illegal conduct.

102. McKinsley states that the Letters and the Statements were particularly

damaging to him, as he is a political organizer and pollster, whose public

reputation in the news media, the business community, the voting public at

large, with the Riding and with others within the Party, and with other current

and potential clients, including the Party, was severely damaged by

accusations of corruption, other malfeasance and improper or illegal conduct.

103. In the opinion of the Plaintiffs, this action will take more than 25 days to

try. The Plaintiffs propose that the trial of this action be held at the Court

House, in the City of Calgary, in the Province of Alberta.

104. WHEREFORE THE PLAINTIFFS EACH CLAIM AGAINST THE

DEFENDANTS JOINTLY AND SEVERALLY:

a.

general damages in the amount of $1,000,000.00;

b. punitive, aggravated and exemplary damages in the amount of

$450,000.00;

c. interest on any amounts awarded in accordance with the Judgment

Interest Act, RSA 2000, c. J-l;

d. costs of this action on a solicitor and own client basis or on such

other basis as this Honourable Court may determine; '


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e. an interim and permanent injunction against the Defendants,

enjoining them from continuing to defame the Plaintiffs; and

f. such further or other relief as this Honourable Court deems just.

DATED at the City of Calgary, in the Province of Alberta, this 19* day of June,

2003, AND DELIVERED by C. David Ryan, Solicitor for the Plaintiffs, whose

address for service at 2380, Ernst & Young Tower, 440 - 2nd Avenue S.W.,

Calgary, Alberta, T2P 5E9.

ISSUED out of the Office of the Clerk of the Court of Queen's Bench of Alberta,

Judicial Centre of Calgary, this 19* day of June, 2003.


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EAlrl A "hecwUr

L

C O M P L A I N T

&

REQUEST FOR

IN VESTIGAT ION AN D

CONSEQUENTIAL ACTION

December 17,2002

Canadian Alliance Party

National Council Secretariat

Dear Members,

We thank you for taking the time to consider this material and recommending such

follow-up action as you deem appropriate.

We believe your decision in this matter is vital to the long-term survival of this party. You

can either unequivocally affirm that the Reform party's bedrock commitment to honesty,

integrity and "doing politics differently" survived the evolutionary process that gave birth

to the Canadian Alliance party, or not. We believe those fundamental values should be at

the core of what the Canadian Alliance party stands for.

If basic concepts of "right" and "wrong" are to have any currency in this party then

members must be assured that suspected "wrongful" conduct will be investigated. Most

importantly, members need to be confident that where misconduct is proven, after

appropriate investigation, those responsible will be held accountable.

We, the undersigned members, believe an immediate investigation into recent activities in

Calgary Southwest is required. Regrettably, based on the incomplete but alarming

disclosures that have been made to date, it appears that a significant number of party

members may have flagrantly disregarded appropriate standards of conduct in Calgary

Southwest since November 21, 2001. Because the Calgary Southwest board has solicited

funds throughout the province and across the country the conduct of this board has

affected members all over Alberta and from coast to coast. Calgary Southwest was a

premier riding but since November, 2001 it has been run into the ground and is now

broke and in debt.

The scope of the possible misconduct referenced within, extends to the campaign and

subsequent election of the self-styled "PAL" slate of Alberta councilors to National

Council. Just as the election of the current board in Calgary Southwest was tainted by

misconduct so too may have been the election of Alberta's three councilors.


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Specifically, the possible misconduct suggested by the partial evidence currently

available and requiring immediate investigation by the Secretariat includes the following:

Questionable Fundraising Solicitations

• On December 3, 2001, when the Calgary Southwest Constituency Association had

assets of $89,534 available, a fundraising solicitation was directed to party members

throughout Calgary inducing members to donate by asserting that the Calgary

Southwest constituency had no funds. Members were specifically asked to contribute

towards constituency by-election expenses. Questions have arisen as to where the

$30,000 reportedly raised at the subsequent December 12th event were deposited.

Were the funds deposited to the constituency association account or were those

member donations deposited to an "In Trust" account not in the control of the

constituency association?

• On January 5, 2002 the constituency association solicited funds from other ridings

assuring them that Calgary Southwest had enough money for the writ portion of the

by-election campaign. But when the by-election was called the money had all been

spent and we've been told that no money at all was contributed bv the constituency

association to the Leaders by-election campaign. Was there flagrantly irresponsible

spending engaged in by the directors and if so, to what end?

» A March 10, 2002 mailer asked members to send a tax-deductible donation but then

urged members on the payment form to take a "business expense" tax receipt rather

than a political donation receipt. Is it appropriate to engage in that kind of fundraising

practice and isn't that similar to the kind of Liberal party fundraising that this party

has questioned in the House of Commons?

Questionable Representations to National Office

» When the Calgary Southwest Constituency Association approached the party in April

for a loan representations were allegedly made that there were creditors pressing the

riding association for payment of by-election campaign expenses. Examination of the

Southwest Alliance Campaign Fund accounts suggests that the expenses were not

constituency by-election expenses, to what extent has the party been asked to fund

debts that are not its responsibility ?

Questionable Use of Constituency Funds and Resources

The "PAL" letter, distributed throughout the province to secure the election to

National Council of three candidates may have been funded using Calgary Southwest

constituency funds. The same Canada Post account was used both for alleged

constituency expenses and for the "PAL" mailer. Since photocopying expenses paid

for by the constituency association are not identified, or in any way broken down, the

Southwest Alliance Campaign Fund may also have been used to cover that portion of


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the "PAL" letter costs as well. Additionally, it certainly appears that the predictive

dialer and the color printer, the purchase of which the constituency contributed to,

was used to craft the "PAL" letter and broadcast messages on their behalf. Were

Calgary Southwest constituency funds used to fund the "PA1" campaign ?

• It appears that membership funds may have been solicited and retroactively used to

finance the takeover of the Calgary Southwest Constituency Association in

November 2001. At a Calgary Southwest Director's meeting on May 15, 2002 it was

disclosed that an " In Trust" account was used to finance an individual's hostile

takeover of the board at the November 21, 2001, AGM and that the same account

was used to finance that same individual's subsequent candidate selection. Numerous

fundraising solicitations for donations to that "In Trust" account were paid for by the

Calgary Southwest Constituency Association. Did an individual in Calgary

Southwest attempt to recoup board takeover expenses from party member donations

secured after the November 21,2001 AGM?

» Records of the Southwest Alliance Campaign Fund disclose that one "PAL"

candidate, not even resident in the riding, accepted direct payment of $500.00 from

the Calgary Southwest Constituency Association. Members want to know why that

payment was made? Was that payment was made to fund the individual's required

candidacy deposit.

1 Some $18,000, more or less, in direct payments were made to other individuals, also

from constituency association funds. Many of those direct payments are described in

the records of the Southwest Alliance Campaign Fund as payments made for

"fundraising", however, no corresponding fundraising deposits to the constituency

association are immediately identifiable. If constituency association funds were used

to pay "commissions" to raise funds, all of the funds so raised belong to the

constituency association. Why were "commissions" paid? What fundraising was

done for those "commissions"? Where was the money that was raised deposited -

into the Calgary Southwest Constituency Association, the Southwest Alliance

Campaign Fund or the "In Trust" account?

The unopposed default candidate for Calgary Southwest received direct payment

from constituency funds and may have been reimbursed twice for his nomination fee

of $2,000. On November 22, 2001 the board unanimously agreed to impose a $2,000

non-refundable registration fee for candidates. On February 27th a cheque for $2,000

described as a "candidate honorarium" was issued and on May 15th, 2002 a motion

was passed and carried by the board to again provide a $2,000 payment using

constituency funds. Did the constituency association actually provide $4,000 to the

default candidate?

Questionable Accounting for Constituency Donations

It appears that bulk of all membership donations solicited between December, 2001

and May, 2002 requested that payments be made to an "In Trust" account that was


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beyond the control of the constituency association. None of those funds have been

accounted for in the Southwest Alliance Campaign Fund records. The constituency

association paid for some or all of the mail solicitations that went out during that

time. In those mailers, members were asked to make donations payable to the "In

Trusfaccount. The fact that the constituency association funded those mailers, in our

view, entitles the party to full disclosure of all funds so received. What funds were

received and where were they deposited?

It is believed that cash donations were received at numerous public meetings that

were fully or partially funded by the constituency association however there is no

record of those funds being deposited to the constituency association account. What

record keeping did the constituency association do in regards to cash donations?

Where did those funds go?

Constituency funds may have been advanced and placed under the control of a

possible candidate prior to his election as candidate. The Southwest Alliance

Campaign Fund was apparently established before the candidate selection meeting.

Did the default candidate or his close friends and advisors have access to that account

prior to the candidate selection meeting?

It appears that constituency funds were used to construct and advertise the default

candidate's website (refer to March 10 mailer and March 2002 mailer) and that

website was then used to solicit donations to an "In Trust" account rather than to the

party. The Southwest Alliance Campaign Fund records disclose payments on

February 27, 2002 of $500.00 and a subsequent payment of $1,000 in that regard.

What donations were received by the "In Trust" account from the web page and has

the constituency ever been compensated for the expenses associated with the web

page construction?

Abuse of Membership Lists

A candidate was mailing solicitations to members as early as December 3, 2001, long

before that candidate became the default candidate in Calgary Southwest and

consequently long before that candidate was entitled to a copy of the membership list

(the Minutes of December 10, 2001 show that the candidate was not interviewed until

December 10, 2001 and only then was consequently entitled to the membership lists).

How did that individual obtain access to Calgary Southwest membership lists ? Is that

individual continuing to contact Calgary Southwest members to promote fundraising

unrelated to the constituency?

Questionable Elections Act Practices

Before the Calgary Southwest by-election was called mailers were sent out that

appear to have been paid for with constituency funds that described a friend of the


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candidate as his Official Agent. Questions have been asked as to whether or not that

is appropriate. Has there been any breach of Election Act requirements?

Questionable Constitutional Conduct

• Decisions were made this past year by the Calgary Southwest board to conduct

unconstitutional candidate selection meetings. Why was it necessary for National

Office to intercede to ensure compliance by the Calgary Southwest directors of the

party constitution?

• The Minutes of meetings have been prepared without referencing who moved or

seconded motions, no executive minutes have been produced, responsible

constituency management appears to have been ignored. From December to April

not a single report was made at a directors meeting as to constituency finances.

When the Financial Statements for the so-called Southwest Alliance Campaign Fund

were presented to the board it wasn't the Treasurer who offered an explanation for

the accounts it was the default candidate who had to explain the existence of three

separate accounts. Members are asking what standards are expected of directors and

whether or not directors in Calgary Southwest have breached their fiduciary duty to

members particularly when the irresponsible spending that has taken place is

factored in. If the directors themselves were relying on the advice of the board

Executive have those executive officers breached their fiduciary duty to members?

$50,000.00 Unaccounted For

At the December 17th, 2001 Board of Director's Meeting a motion was passed to

move $50,000 of the liquid assets of the constituency to an unidentified lawyers' trust

account. What happened to those funds?

Questionable Tax Receipt Instructions to Members

• Donors have been urged to contribute to an "In Trust" account for "business expense"

tax receipts rather than being asked to contribute in a fashion that would entitle them

to "political contribution" tax receipt, but which would result in National Office

receiving 20%. Is this appropriate?

Questionable Conduct Surrounding Constituency Property

It appears that property paid for using constituency association funds are not in the

control of the constituency association. The candidate stated in mailers that funds

donated by members were to have been used for lawn signs, brochures,


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advertisements, and other by-election campaign expenses. The Southwest Alliance

Campaign Fund Financial Statements establish that those lawn signs, brochures and

advertisements were paid for by the constituency association. Where has that

property gone?

Questionable Conduct Relative To Apparent Conflicts Of Interest

• Individuals with a clear personal/corporate financial interest have entered into

contracts and arrangements with the constituency association and have thereby

secured personal benefit for themselves or business benefit for their corporate

entities. One individual was given control of Southwest Alliance Campaign Fund

spending and he was also the recipient of approximately $40,000 in direct payments

to himself or his corporation. What were the funds used for? Why was this individual

allowed to receive such a benefit? What interest in the property does the constituency

association have in return for the $40,000?

Undocumented Payments Made

• Thousands of dollars have been paid to one particular individual with no indication

as to what the expenditures were for. What was the moneyused for and where are the

receipts or invoices to substantiate those payments?

Questionable Attribution of Expenses

• Numerous accounts have been maintained by a very close group of individuals and

that has enabled that small group to selectively attribute expenses such that

consumables have been run through the constituency association but durables have

been paid for from an " In Trust" account. Why was this allowed to happen and is it a

breach of director's duty to the members to allow such questionable business

practices? Why did directors not protect the members interests? Why did the default

candidate not protect the members interests in this regard?

Questionable Refusal bv Board to Pay Creditors

• The board selectively neglected to pay two outstanding creditors. Have the actions of

the board brought the party into disrepute?

As a consequence of the questioned activities outlined above, the undersigned members

are asking the Secretariat to do the following immediately:

1. Launch an investigation into what has taken place in the Calgary Southwest

Constituency from November 21, 2001 to the present, using such internal resources,

external investigative agencies and professional associations or societies as necessary

to ascertain all relevant facts. The investigation should include examination and audit

of all the Calgary Southwest Constituency Association's financial accounts and all

other as yet undisclosed accounts directly or indirectly related to the by-election


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Z l̂SlEST"* iDClUdin8 *• ***** **- Campaign Flmd

«E2E Ẑt̂S rs S n4 orough tavest̂ *•

deem it to be appropriate: S' lf the Secretanat and National Council

3" SLT*" " "^ ^ S- 3 W W of - P^ constitut ion as

- £22£ SStbmi t ted ^ * - " " " "« Wh° *~


40/70

- 8 -

conduct was being investigated - these are people with a track record of

belligerent and bullying behaviour.

Every member of this party who cares about political decency and

honesty should immediately contact the Leader's Office (Attention

Stephen Harper - Phone (403) 253-7990, the Executive Director

(Attention Terry Horkoff - Phone (403) 269-1990) the National Council

S e c r e t a r i a t ( A t t e n t i o n J e r r y R i c e - e m a i l t o :

[email protected]) or the Calgary Southwest Constituency

Association (Attention the President - Mr. John Flynn Email to:

[email protected]) to demand to know what has been done to

address the very serious questions raised in this complaint.

The people implicated in this Complaint continue to seek control of

other ridings. It is not fair to those ridings or to party members to leave

these important questions unanswered.

The party has responsibility to its members to perform and conclude

this investigation and publicly exonerate those that have been

implicated if they have done nothing wrong or appropriately sanction

those that have engaged in misconduct.

Democracy works best under the light of truth and fails miserably when

cloaked in the darkness of secrecy. Members are being asked to perform

an essential democratic task and they cannot do that if the party

withholds vital information.

We all know from bitter experience that the failure of any one riding to

diligently accept their responsibility to carefully examine potential

candidates can do immeasurable harm to every other riding. Every

Canadian Alliance member who receives this e-mail has a duty to

demand that the party not shirk from its duty.


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B4lt a "^.w 2f

January 24,2003

Canadian Alliance

300,717-7th Avenue SW

Calgary, Alberta T2P 0Z3

ATTENTION: Mr. C. TERRY HORKOFF, EXECUTIVE DIRECTOR

RE: COMPLAINT AND RFOf fEST FPU mvnmnAT,™ , ^ rnrnroUENTAIT. apt,™

Dear Sir,

S o u t h w e s t c o n s t i t u e n c y , s i n c e N o v e m b e r 2 1 , 2 0 0 1 . g ^

2001 have a well-known track record ZiSwL if .g^ Southwest since November,

^ ^ t h a t t h e i T ^ S ^ ^ .

or signatories, be kept in strict confidence. It has been verv rfS^„ * organizers

the reputation of those who are to be the mto£«fZ^ 7 * e°Ure s,enatures. given

o n l y o n c o n d i t i o n t h a t c o n f i d 7 n £ £ t o S ^ ^ ^ T ^ ^ " " " " * " " * " * *

r e p r e s e n t a t i o n ^ ^ d ^ J Z Z T ^ S ^ ^ ^ T ^ 1 0 ^ ^ 0 1 1 ^


42/70

fashion is that the Calgary Southwest Constituency Association is controlled by the very people

who must answer for the conduct complained of. Since it appears that the Constituency

Association cannot be relied upon to defend the rights of members, we the concerned members

must do so.

Thank you for your attention in this matter. In the event that you require any additional

information or representations please advise when members of our group contact you to follow

up.

i t * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *

Attachments Included:

Complaint and Request For Investigation and Consequential Action and party member

signatures.

Southwest Alliance Campaign Fund Financial Statements - January 17,2002 to April 30,

2002 (including cheques)

Minutes of Board of Directors Meetings, November 22,2001 - August 8,2002

Previous Board's Financial Statements showing $89,534.07 was provided to the new board.

December 3,2001 - Re: Calgary Roundup Centre

December 5,2001 - Re: December 19th

January 5,2002 - Request to all Constituencies for funds

March 10,2002 - "business expense" donation to Ezra Levant-in Trust or lose 20% if to

Canadian Alliance-Calgary Southwest - Canada Post 7023157

March 22,2002 - Community Events

Brochure #2

PAL Letter - Canada Post 7023157


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MEMBER ADVISORY

G R O S S M I S C O N D U C T I N C A L G A R Y S O U T H W E S T

S U S P E C T E D

I M M E D I A T E A C T I O N R E Q U I R E D

M E M B E R S H I P S O F A N Y R E P O N S I B L E S H O U L D B E R E V O K E D

May, 2003

Canadian Alliance Friends,

About fifteen years ago, tens of thousands of us were attracted to the Reform/Alliance party by

the honesty and integrity of one man, Preston Manning. The founder of the Reform/Alliance

movement believed that politicians must tell the truth, even when it hurts. That rock-solid

adherence to the "truth" made membership in the Reform/Alliance party something to be proud

of.

Regrettably, since Mr. Manning transferred the care and trust of this party to others, the core

values of honesty and integrity have been constantly threatened. Just as the PC party imploded

when it turned its back on its members, so too is the Canadian Alliance party in danger of

driving out the very people who nurtured its growth. The decent men and women who came to

the party to "do politics differently" are being ignored. Rather than enforcing our own

constitutionally enshrined rules for proper conduct this party is increasingly toiling a blind eye

to corruption in our own ranks and never more blatantly than in Calgary Southwest.

Please read the attached Complaint and Request for Investigation and Consequential

Action - signed by more than 150 party members - exposing questionable conduct that no

honest party member could tolerate if proven. The Compliant was forwarded to the Executive

Director of the party for delivery to the National Council Secretariat in January, 2003. Until now

the concerned members who uncovered this scandal have relied on the party to act but

unfortunately the party has erected a wall of silence. Rather than investigate the substantial

concerns contained in the Complaint the party has ignored the concerns and apparently seems

determined to shelve the Complaint. Now it's time for the members to act The party can only

get away with what members allow them to - LET'S NOT LET THE PARTY ABANDON

HONESTY AND INTEGRITY

Here are some shocking allegations that you haven't been informed of - because the party

apparently wants to hide the truth from it's own members:

• The Calgary Southwest Constituency Association contributed no money to the

leader's May, 2002, by-election campaign - despite having been entrusted with

almost $90,000 only four months earlier? The Constituency Association threw away

$90,000

• The Calgary Southwest Constituency Association allowed members in the riding

and throughout Calgary to be deceived into believing that the election war chest was

empty when it in fact had $90,000.


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• One individual was allowed to siphon out donations from members in Calgary

Southwest and across the country from November, 2001 on without those donations

ever being turned over to the party or to the constituency association.

• Money from members in Calgary Southwest appear to have been used to finance

nothing but consumable expenditures, leaving the Constituency Association with

nothing to show for having spent tens of thousands of dollars, while durables were

purchased from another account to the personal benefit of the people controlling the

money.

• Money donated by honest Reform/Alliance members over the years, intended to

fight the Liberals may have been misappropriated to offset the expenses of just one

member who chose to conduct a hostile takeover of the Calgary Southwest board in

November, 2001.

• Constituency money was handed over to individuals who ignored accepted conflict

of interest guidelines and beneficially contracted with "themselves" - sucking your

hard earned money into their pockets ?

The very same people who are implicated in the possible wrongdoing outlined above are now

trying to take over in Calgary Centre. Because the party has failed to investigate Calgary Centre

could end up with a candidate the opposition will easily discredit using the very information our

own party has ignored. It's time for all honest members of this party to demand that the party

investigate these allegations. The party has the authority to secure production of records that will

prove the allegations or exonerate those that have been implicated.

The party has a duty to act and to serve its members. Here's what you can do:

1. Contact the Calgary Southwest Constituency Association President, Mr. John Flynn,

(email to: [email protected]) and demand to know what is being done by the

Southwest Board to investigate this Complaint

2. Contact the Leader's Office (phone: (403) 253-7990) and ask Stephen Harper why he's

not protecting the members of this party to make sure they're treated honestly. •

3. Contact the Executive Director of the Party (phone: (403) 269-1990) and ask Terry

Horkoff why National Office hasn't done anything to obtain answers to the Complaint.

4. Contact the National Council, Secretariat (Attention Jerry Rice - email to:

[email protected]) and tell them in no uncertain terms that the proud

members of this party want to preserve core values of- honesty and integrity

5. Forward e-mail copies of this Advisory and the Compliant to all your Alliance friends, to

other constituency board directors and to MP's and print off copies to give to members

without computers.

PLEASE ACT NOW

DON'T LET THIS PARTY BECOME A CORRUPT IMITATION OF THE LIBERALS


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January 24,2003

Canadian Alliance

300,717-7th Avenue SW

Calgary, Alberta T2P 0Z3

ATTENTION: Mr. C. TERRY HORKOFF, EXECUTIVE DIRECTOR

RE; COMPLAINT AND REQUEST FOR INVESTIGATION AND CONSEOUENTAIL ACTION

Dear Sir,.

As you know, the Leader has been made aware of very significant concerns that many concerned

Canadian Alliance party members have regarding the conduct of matters in the Calgary

Southwest constituency, since November 21,2001.

Concerned members have been told that the appropriate constitutional procedure to initiate a

thorough investigation into this matter is by way of a Formal Complaint forwarded under the

signature of those members. In compliance with that request, enclosed please find the above

mentioned "Compliant and Request For Investigation and Consequential Action" which has been

signed by dozens of Canadian Alliance members in numerous ridings in and outside of Calgary

Southwest. We would urge you to look carefully at the names of the long standing, committed

party members who are asking the Secretariat to take this very significant step. All are dedicated

party members who want this party to continue to stand for the principles of integrity and

honesty that brought us to the party in the first place. Many have served or are currently serving

in significant party roles. All have given their time and energy to the growth of this party and

will not stand idly by as others bring it down. Members are continuing to ask for the opportunity

to sign this Complaint however we feel compelled to put this into the hands of the Secretariat as

soon as possible. Accordingly, as additional member signatures are collected we will forward

them to your attention.

This document is being provided to you for del

levant v the world - 2003

Documents