How conflict of interest rules affect the public interest

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Since the Redford, Katz, Ford and other scandals of late, there has been much discussion about conflict of interest rules, what is and isn't a conflict of interest, and whether there can be degrees of conflicts of interest. What should the legislative penalties be where a conflict is found?

Conflict of interest can be a difficult subject. Various provincial and federal statutes govern conflicts of interest. Roughly speaking, a conflict of interest for a public office holder is usually defined as the exercise of an official power, duty or function that provides an opportunity to further private interests.

How does one know when a conflict of interest exists? To simplify, the test is whether a reasonable person would be likely to regard the interest as one that would influence the public office holder's action or decision. In other words, is there some benefit or detriment to the office holder that could arise from the action or decision? 

The underlying principle is that a public office holder should not be involved in a decision if there is any real possibility that they could be influenced by their outside interests in a decision instead of by the public interest. The issue is not whether the person was actually influenced.  Public decisions should not only be made in the public interest, they should be seen to be made in the public interest. This is because when decisions are not beyond reproach it undermines public confidence in the whole system. Therefore, the interest being protected isn't just the financial interest of a public body, but the confidence of the public in democracy.

In the discussions around Toronto Mayor Rob Ford's removal, I see an unfortunate focus (including in Justice Hackland's decision) on the personal blameworthiness of Ford, or lack thereof, and whether the "punishment fits the crime." In my view, this entire discussion misses the point; the issue is not personal to Rob Ford. The consequences in conflict legislation should be restorative, in other words by removing Ford, the conflict is in some way seen to be "cured".  A move to a more punitive model, with flexible "penalties" would be unfortunate. Sadly, it was the case that some reactions to the Toronto conflict assumed the system was so corrupt it wasn't worth correcting this conflict.

More flexible "penalties" can cause messy (or frankly toothless) solutions that are highly politicized, as was the case with a recent Cabinet Minister in Nunavut. The balance is a delicate one. Politicizing the allegation or the remedy is not good. This can result in the tossing around of unsupportable allegations of conflict. In my view, Alison Redford's department awarding of a tobacco contract to her ex‑husband's law firm is simply not a conflict. It is important to recognize that public office holders are affected, like the public at large, in some way by many of their decisions. The issue is whether the conflict that exists is objectively likely to influence that decision, not whether some remote or indirect connection can be established. In Redford's case, the Alberta speaker properly found there was no conflict when Redford's department awarded a litigation contract to Redford's ex‑husband's law firm. 

Raising weak conflict of interest allegations might score some political points, but it is bad for the public interest. Like conflicts of interest themselves, such allegations serve to foster doubt about the proper functioning of democratic institutions. 

Iler Campbell LLP is a law firm serving co-ops, not-for-profits, charities, and socially-minded small business and individuals in Ontario.

Note: Pro Bono provides legal information designed to educate and entertain readers. But legal information is not the same as legal advice -- the application of law to an individual's specific circumstances. While efforts are made to ensure the legal information provided through these columns is useful, we strongly recommend you consult a lawyer for assistance with your particular situation to obtain accurate advice.

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