The Whalley Trial Part IX: Answers

Editor’s Note: John Whalley, the former Economic Development Manager of the Cape Breton Regional Municipality (CBRM) is suing the CBRM for constructive dismissal. The case finally came to trial from 20-24 August 2018 and the Spectator was there. We’re presenting our coverage in a series of articles because the trial touched on so many issues of interest to CBRM residents. This is Part IX (Read Part I,Part II,Part III,Part IV,Part V, Part VIPart VII and Part VIII).

 

Marie Walsh, who has worked for the CBRM since 2007, served as director of finance under CAO Jerry Ryan, as acting CAO once Ryan was “let go,” as chief financial officer under CAO Michael Merritt, and, since 2017, as CAO of the CBRM.

Marie Walsh

Marie Walsh

There was a small mystery surrounding Walsh’s appearance as a witness for the defense in that, she was originally on the witness list but the CBRM’s lawyer Tony Mozvik told the court he had “no idea” how her name had got there and that he didn’t intend to call her.

Her name came up in subsequent testimony, however, and a number of her emails were entered in evidence, so Mozvik announced he would call her if the plaintiff so wished. Apparently, the plaintiff so wished, because Walsh took the stand on August 23.

As with Merritt’s testimony, I have already quoted from Walsh’s throughout this series and will try not to repeat myself, but I’ve told you that my chief interest in the Whalley trial was in the glimpse it provided into the workings of the CBRM under Mayor Cecil Clarke and Walsh’s testimony threw open a window that gave me an amazing view.

 

All the Mayor’s Men

It happened during her cross-examination by Whalley’s lawyer, Blair Mitchell:

Mitchell: You had been employed with the municipality since 2007, am I right?

Walsh: Yes.

Mitchell: Okay, and during that period of time certainly mayors prior to the…2012 election did not exercise any employment direction over employees, did they?

Walsh: No.

Mitchell: In fact, that’s explicitly prohibited by the Municipal Government Act?

Walsh: Yes.

Mitchell: Okay, so, you took this message [telling Whalley the door was open to his returning] from [Mayor Cecil Clarke] to John , this was explicitly, as far as you knew, from the mayor, correct?

Walsh: Yes.

Mitchell: And the mayor, at that point, had been actively involved in directing employees with respect to port development…?

Walsh: Yes.

Mitchell: And some of those employees had even been hired, as far as you knew, at least, outside of the municipal hiring process, correct?

Walsh: Ah, yes.

Mitchell: And those employees took direction from the mayor, right?

Walsh: Yes.

Mitchell pressed a little harder on the character of these mysterious “persons”:

Mitchell: We’re dealing with persons who were under contract, those were folks that were under contract and took direction from the mayor’s office, correct?

Walsh: Correct.

I listened to my recording of Walsh’s testimony in preparation for writing this (reporters are permitted to make audio recordings of court proceedings) and it struck me that Whalley, too, had referenced “people” hired to work on the port file, so I went back to listen to his testimony again.

Sure enough, during his cross-examination by Mozvik, Whalley said:

[T]here was a meeting, an in camera meeting, where the council directed the mayor to take the lead on port development, which was June of 2013. The individuals – two to three, Mike Moore, Neil MacNeil, Jim Gogan —  were hired, I think, in July of 2013. I think Neil MacNeil and Mr. Gogan were instructed to lead this work on the governance issue probably late summer of 2013,

Whalley said explicitly elsewhere in his testimony that Moore reported to the Mayor’s office, so I am going to go out on a limb and say (and I stand to be corrected) that these are the “employees” whom Walsh agreed had been hired outside the municipal hiring process and who were being directed by the Mayor: Mike Moore, Neil MacNeil and Jim Gogan.

 

Carte blanche

For the record, the resolution giving the mayor the lead on port development was passed during a Special Council Meeting on 1 March 2013:

 

In January 2018, District 2 Councilor Earlene MacMullin tried “valiantly,” as I put it at the time, to challenge the mayor’s interpretation of this resolution as his basically being declared point man on the port file for life (and Regional Solicitor Demetri Kachafanas’ interpretation that the motion allowed the mayor to travel “anytime and anywhere” in the name of port development).

It’s worth recapping her arguments because they were quite comprehensive:

Councilor MacMullin tried valiantly to contest Kachafanas’ interpretation of the 2013 motion, arguing it applied rather narrowly to port promotion efforts then underway involving the CBRM’s former port consultants Ed Zimny and Gordon Forsyth IV of Paul F. Richardson and Associates. She noted the CBRM now has a new council. She argued that “gathering information on the possibility of the development of a container terminal at the Port of Sydney” is surely a step that has been completed. She pointed out that the motion does not mention our current port promoters, Albert Barbusci and Barry Sheehy of Sydney Harbor Investment Partners (SHIP). She reminded council that the Chinese were not involved in the project in 2013, so the motion could hardly have envisioned travel to China. She noted that where the motion references the “Acting CAO” (Marie Walsh at the time) we subsequently had an actual CAO (Michael Merritt), another acting CAO (Walsh) and now another actual CAO (Walsh). In short, she suggested it was a stretch to imply that this very specific motion passed in 2013 should apply to all future port development activity.

One could also add that there was nothing in that motion authorizing the mayor to hire consultants who would report directly to him.

 

BCB

But how, exactly, were these “employees” hired?

Well, both Whalley and Merritt testified that Mike Moore was a consultant hired through Business Cape Breton (or the Cape Breton Small Business Development Corporation, as it was known at the time). And Neil MacNeil’s report was commissioned by the Cape Breton Small Business Development Corporation.

Both MacNeil and Moore are listed under “Consulting” in this account of port development expenses presented to council by Whalley in December 2014.

Gogan (or Breton Law) is also listed. So I think it is safe to say that all three were paid (at least initially) through BCB. (Gogan would later be paid through the Port of Sydney Development Corporation.)

Port_expenses

 

And suddenly, the mayor’s loyalty to BCB takes on a whole new complexion: why wouldn’t he insist on funding an organization that was apparently allowing him to hire consultants who reported directly to him?

 

In conclusion…

I told you that I was interested in the Whalley trial because I was hoping to get answers to a number of questions that have been niggling at me since I started paying attention to municipal politics and in Marie Walsh’s testimony, I got them.

Left to right: Jim Gogan of Breton Law, cover of Neil MacNeil's port report, Mike Moore of Heddle Marine.

Left to right: Jim Gogan of Breton Law, cover of Neil MacNeil’s port report, Mike Moore of Heddle Marine.

Mayor Cecil Clarke had contract employees, hired outside the municipal hiring process, whom he directed and who reported to him on matters related to port development.

These employees were hired through Business Cape Breton, a quasi-public organization, funded entirely by public money but unaccountable to citizens.

An organization that had hired Clarke, without a job competition, at a salary of $130,000 a year, the year before he ran for municipal office.

An organization for which the mayor actively sought municipal funding after it lost its provincial funding.

How’s that for answers?

Following Walsh’s cross-examination, both the defense and the plaintiff in the Whalley trials rested their cases.

Next up, I will summarize their summations and attempt a summation of my own, but for now, we stand adjourned.

 

 

 

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