Council was back in session on Monday night to take in, discuss and “debate” the Ombudsman’s report. It was an interesting meeting to say the least… if you did not watch or do not want to watch, here is a long post of highlights from the meeting.
The Ombudsman’s First Letter – Council Concerns
As the report actually comprised of two separate letters on two sets of matters, Councillor Bothwell out of the gate suggested that the discussion be split… that was probably a good call, as kept it discussion flowing properly.
First at bat was Councillor Dunstall, who, reading from a prepared statement, more or less summarized the letter and verbally underlined some of the letter’s content, including the termination of the Town Manager in 2019, the previous Clerk’s retirement package, the conduct of an “external lawyer”, a possible conflict of interest between a Member of Council and a lawyer, and other procedural errors committed by Council as a whole (lack of confirming By-laws).
Councillor Vardy raised the fact that there was some procedural errors on the termination of the Town Manager. On the retirement of the former Clerk, Vardy stated that the Clerk had approached everyone on Council and HR. She further stated that “we are making a mountain out of a mole hill”, which was on point, and noting that Council at the time (early 2019), was largely a rookie Council that simply made mistakes.
Councillor Ritchie on the Clerks’ retirement package thought:
“it would be awesome, if I had the ability to go to my boss and ask for a package… and get what… 5 months severance, or 5 months payout and not have to come to work”.
That comment was interesting given that Grimsby’s current CAO has earned nearly $1 million from Brampton taxpayers over the last three years, despite not having worked there since 2018.
Councillor Vardy retorted, taking issue with the “boss” statement and that the Clerk went to HR, which in her opinion was the proper thing to do.
Ritchie then went on quoting his “anonymous” emails and commented that the Clerk got paid $42,000 for her retirement package and that it was not approved by Council, but by the Mayor. He closed off stating the Ombudsman had “recommendations” in his letter, which drew fire from Councillor Freake who pointed out that the letter contained “best practices” not recommendations.
For clarity, the word “recommendations” appears three times in the entire report and not in the context as suggested by Councillor Ritchie. The Ombudsman does state “I encourage Council for the Town of Grimsby to carefully consider the best practices I have identified…”
Councillor Freake continued on and stated:
“three years ago, we were new at this Council, two months into the Council, yes, we did things wrong, yes maybe we broke some procedures, didn’t follow some procedures because we didn’t know what we were doing, yes that’s probably very true”.
He further added that “we’ve come along way since then, we have had the training mentioned in this report”. He asked Councillor Ritchie if he was “attempting to change history” which caused a bit of kerfuffle largely inaudible.
The topic of the “anonymous” emails was raised by Councillor Vardy, calling out Councillor Ritchie for his handling of the emails, posing the rhetorical question “what would an honourable person do?” and that he “got them in a way he shouldn’t have”.
Councillor Sharpe spoke about the meeting at the Peach King Centre of July 2020, where those anonymous emails surfaced and highlighted how the Mayor broke the Code of Conduct after that meeting by contacting an “individual”. In his report on that, the Integrity Commissioner stated that the Mayor contacted the author of the emails after the meeting “out of a concern in relation to civil litigation initiated by the Town and sensitive information that may have been breached”.
Councillor Ritchie then explains the sources of the “anonymous” emails and that they were from:
“one individual that we are not going to talk about… well we can, it’s a lawyer, it’s a lawyer, it’s legal… maybe who… Mayor Jordan talked to after the closed session…”.
Councillor Vaine later expressed concern and caution that comments were being made that may be revealing closed session information… and he was right in doing so. Through Councillor Ritchie’s admission, we can now put together that this lawyer is the “individual” who is involved in the “civil litigation initiated by the Town”. According to the Ontario Court Case Search website, there is only one case active that has been initiated by the Town… but that’s a topic for a future post.
Vardy asked the Clerk to make copies of the emails and distribute them to Council so everyone could understand what Councillor Ritchie was speaking about. She further wanted to be assured that he was providing all the emails, he stated that he would provide all. On advice of the Clerk, the Mayor recessed the meeting while the copies were made.
After returning from the recess, Councillor Kadwell also read out a prepared statement on the matters, speaking about how the Ombudsman’s report mentioned referring a matter to the Integrity Commissioner. He recounts the Code of Conduct and on the allegation of acting without Council authority stated “You, Mr. Mayor, took this right away from this Council. The Town’s Council-Staff policy provides that Council Members do not have an administrative/managerial role, in the Town’s day-to-day operations”.
Councillor Dunstall later moved a motion, seconded by Councillor Vaine that stated:
“Resolved that Council file a complaint with the Integrity Commissioner to investigate the relationship between the Council and the lawyers pertaining to the conflict of interest.”
On the motion, Councillor Sharpe raised his concerns on the alleged conflict of interest. His points were valid on what a conflict is and is not and said he was not sure sending the IC onto the case was the right choice, also citing potential costs. He stated clearly “I don’t believe there is a conflict of interest”.
Councillor Ritchie added that “when it comes to government and when things are wrong, I think the public is owed an explanation”.
Further discussion ensued and the motion was brought to a vote. The recorded vote was as follows:
Yeas: Dunstall, Kadwell, Ritchie, Vaine, Mayor Jordan
Nays: Bothwell, Freake, Sharpe, Vardy
The motion was carried and a second resolution came shortly thereafter, to make a complaint about the “lawyer” mentioned in the Ombudsman report to the Law Society. The motion was brought forth by Councillor Dunstall and seconded by Councillor Ritchie, with a recorded vote as follows:
Yeas: Dunstall, Kadwell, Ritchie, Sharpe, Vaine
Nays: Bothwell, Freake, Vardy, Mayor Jordan
The motion was carried. Councillor Ritchie then put forth a motion for Staff to review the Staff-Council Relationship policy to strengthen it and provide initial and periodic training. On that motion:
Yeas: Bothwell, Dunstall, Freake, Kadwell, Ritchie, Sharpe, Vaine, Vardy, Mayor Jordan
The Ombudsman’s Second Letter – CAO’s Firing of the Treasurer & Banking Activity
Councillor Bothwell commented first and that there was two versions of this letter from the Ombudsman… which is a story on its own. She re-read a portion of the letter that detailed the CAO sending two Staff members to the bank to add themselves as signing authorities (after the Treasurer and other finance Staff had been fired by the CAO at the end of March 2021 without Council authority).
She then went on to state that comments were added about the CAO’s claim of a bank “workaround”, but the Ombudsman’s Office commented they were unable to confirm this with the bank due to “privacy restrictions”. It was also pointed out that in the letter that the CAO stated to the bank a resolution would be brought at the “next council meeting” to address the matter of signing authorities.
Bothwell pointed out that this motion/resolution was not brought to the next Council meeting, and several thereafter until she made an information request on the matter and it was finally addressed on April 26, 2021.
Further she pointed out that the By-laws passed, some of them retroactive, missed important gaps. Despite a legal review at the time by one of the Town’s lawyers, that review in applying the By-law retroactively missed the fact there was no Treasurer in place from March 30, 2021 to April 5, 2021.
Bothwell stated there was serious gaps in the Town’s fiduciary duty and that it needs to ensure that the Town has “covered all it’s bases” when there was no Treasurer. She stated that based on the information in the Ombudsman’s report, the Town needs to ensure that it has fulfilled its fiduciary duties in case an auditor looks at it.
A very long motion going over the history of the matter was put forth by Councillor Bothwell and seconded by Councillor Vardy. Since it is too long to transcribe, here is just the “therefore” from the motion:
“Therefore be it resolved that the Clerk be directed to provide the Town’s banking institution with a copy of By-laws 16-37, 21-22 and 21-31 and have the bank verify in writing that the appropriate delegations and resolutions both Council and corporate were in place during the period of March 31st to April 5th 2021 as was communicated by the CAO in the Ombudsman’s Report. And further that upon a determination of findings from the bank the Clerk present a report to Council on the matter”.
Councillor Vaine expressed concerns that this has been discussed before and wondered if the CAO automatically becomes the temporary Treasurer, in the absence of a Treasurer. The Clerk clarified that a Treasurer needs to be appointed (by Council), the CAO does not by default become the Treasurer.
Vaine further questioned what should have been done:
“are we supposed to keep Staff that we didn’t feel, for whatever reason… whatever reason the CAO terminated the Staff, are we supposed to keep them until we employee someone else or?”.
The proper answer probably would have been for the CAO to inform the Mayor and Council, so that they could call an emergency meeting to appoint a temporary Treasurer… but this did not happen.
After throwing the ball to the CAO, the CAO recounted his version of events of sending the employees to the bank to keep the operations moving. He further stated he felt it had already been discussed and urged Council to just look at the summary of the Ombudsman’s report.
Councillor Bothwell stated that “there should be no issue then with transparency to go this route to verify with the bank”.
She highlighted language in a 2021 report from the new Treasurer on the retroactive signing authorities By-law, which in-part relied on the legal opinion, which was actually redundant and had no effect for that period (March 30-April 5, 2021) because there was no Treasurer during the time. Based on this, it makes one wonder how the Town’s high-priced legal firm, Aird & Berlis, missed this important and obvious gap of law?
Councillor Ritchie admits proper procedure was not followed and attempted to deflect Bothwell’s points by reading, unknown if it was from a report or a prepared statement, about the retroactive nature of the By-law. Unfortunately it did not appear that he understood the motion, as nothing could occur, even retroactively as there was no Treasurer for about a week.
The Mayor, who was the only signing authority left after the Staff terminations, stated “just for the record, I was not contacted as the only signing authority for the corporation at the time”.
Back to Councillor Bothwell, to the discussion she added that the “CAO could have attended the bank and signed himself as the signing officer and he did not do that, which is unusual” and that a Senior-level Bank Official told her that the actions taken at the bank “would not be the normal process”. She further stated that the bank’s side of the story is needed and that the motion would clarify that in the time the Town had no Treasurer, that the actions taken were appropriate.
Councillor Ritchie replied and stated that the new Treasurer went back and looked at the period in question, reviewed the transactions and reported no irregularities. He went on to state:
“we have been very transparent with the public and told them what happened, it happened at our Council meeting… and we asked for a legal opinion”.
He wondered why there was a need to go to the bank “to ask a question we already know”.
Councillor Bothwell added as a final comment that the problem didn’t go away, as it was discovered at the Library Board in June 2021 that they did not have two signing officers. She wanted to make sure that nothing else has been left unaddressed.
In response to that, Councillor Ritchie suggested that the motion should be a departmental review by Staff. Councillor Bothwell interjected and some back-and-forth occurred as to previous motions on that matter being defeated. She stood firm, stating that her motion was on the floor and she wanted it to be voted on.
Shortly thereafter, the motion to have the Clerk verify with the bank and report to Council was voted on, with the following result:
Yeas: Bothwell, Freake, Kadwell, Sharpe, Vaine, Vardy, Mayor Jordan
Nays: Dunstall, Ritchie
The motion was carried.
Are you still there? You didn’t fall asleep? If so, congratulations for making it all the way through… no prizes are awarded however. But if the notes were not enough for you, feel free to watch a replay of the meeting at the following links:
First Letter From The Ombudsman (Council Concerns)
Second Letter From The Ombudsman (Termination of Treasurer, Bank Signing Authorities)