Canada

Mulroney's battle

The stakes are high in what may be Canada's civil trial of the century

JOHN DeMONT December 30 1996
Canada

Mulroney's battle

The stakes are high in what may be Canada's civil trial of the century

JOHN DeMONT December 30 1996

Mulroney's battle

The stakes are high in what may be Canada's civil trial of the century

Canada

JOHN DeMONT

Room 5.15 of the Quebec Superior Court in Montreal holds 300 people. On Jan. 6, the seats will be filled as what is already being billed as Canada’s civil trial of the century gets under way. The plaintiff: Brian Mulroney, arguably the most reviled leader in Canadian history, fighting for, as he has said, his “good name.” Facing off against the former Tory prime minister are the federal government and the RCMP. At stake is a $50million demand for damages, at issue a letter that pulled no punches. On Sept. 29,1995, the federal justice department asked the Swiss authorities for help in investigating allegations that Mulroney had received kickbacks in the 1988 sale of 34 Airbus Industrie passenger jets to Air Canada. Written in German and signed by justice department senior counsel Kimberly Prost, the letter concluded by declaring: “This investigation is of serious concern to the government of Canada as it involves criminal activity on the part of a former prime minister.” Mulroney denies the allegations. He says the letter, which was leaked to the media, sullies his reputation—and has come out swinging against the Liberal government that swept his Tories into political oblivion. It may lack the visceral drama of O.J., but hold onto your tuques: in a general election year, the big explosions on the political landscape could occur not on the campaign trail but inside the Montreal courtroom.

The case has multiple layers.

On a literal level, it is about whether a pair of RCMP officials, Prost and federal Justice Minister Allan Rock libelled Mulroney. But that is just window dressing for the real drama: did the prime minister of Canada, as the RCMP maintains, receive millions in payments? Did Jean Chretien’s government, as Mulroney’s lawyers will argue, set out to “get” their old political rival? Did the Conservative ex-prime minister, as the government lawyers contend, obtain a version of the letter and leak it to the media in an effort to divert attention from the investigation itself? “This country has never seen a trial like this,” declares Simon Chester, a Toronto lawyer and libel specialist. “Most countries haven’t seen a trial like this.” Another lawyer who is involved in the proceedings puts it this way: “It’s the trial of the century—and every lawyer in the country would love a piece of it.” Riddled with complicated legal issues, this tale has more shadowy subplots than a John le Carré novel and enough dark secrets and larger-than-life characters to fuel a season at the Canadian Opera Company (page 76). Out-of-court settlement appears to be out of the question—the plaintiff is outraged; the federal government has assembled a legal “dream team” to marshal its defence. No wonder CBC Televi-

sion is clamoring to bring its cameras into the courtroom for a trial that, by some estimates, could run as long as three months. As one member of the Mulroney team puts it: “From the first moment the trial begins—booml—the pounding will be constant.”

The tale goes like this. Somewhere along the line, the RCMP says, they received “reliable information” that Mulroney, former Ottawa lobbyist and Newfoundland premier Frank Moores and GermanCanadian businessman Karlheinz Schreiber received millions of dollars in illegal commissions to facilitate the $ 1.8-billion Airbus sale. As part of the investigation, the Mounties had the justice department send the letter to Swiss authorities, asking them to freeze a numbered bank account belonging to Schreiber and two other accounts “believed to be registered to Moores.” According to a confidential source, the letter asserts, the kickbacks passed through those accounts. On Nov. 18, Philip Mathias, a reporter for the Canadian business daily The Financial Post, broke the news that the RCMP was investigating Mulroney and even quoted from a version of the justice department document. Within hours of the Post story, the ex-prime minister’s lawyers announced that Mulroney would sue for libel, claiming that the “false and reckless allegations” in the letter caused “serious damage to Mr. Mulroney’s reputation, professional and otherwise.”

Since then, the Airbus affair has become something of a political blood feud. Justice department spin-meisters have hinted that Mulroney was trying to thwart justice or have painted the former prime minister as a crass opportunist. But Mulroney partisans, who have grown increasingly vocal about what they see as his unfair treatment by a biased media and a vindictive Liberal government, have been effective. “He has the shield of truth,” declared Luc Lavoie, Mulroney’s former deputy chief of staff and now an Ottawa public relations executive hired by the former prime minister. “There have been no kickbacks. There is no foreign bank account. Everything else is bullshit.”

Can the ex-prime minister, now making millions as a globetrotting corporate troubleshooter for such companies as Barrick Gold Corp. and Archer-Daniels-Midland Corp., successfully portray himself as a humble private citizen being victimized by a vindictive government? That image may gain credence when his small legal team finally faces off against the massive government side, which has billed Ottawa more than $700,000 even before the trial begins. The government may need every edge it can muster. “This is not, by any means, a slam dunk,” says one justice department official close to the case who predicts a tough courtroom battle.

The plaintiff’s legal team will almost certainly parade a line of

high-profile past and present politicians through the court to attest to their client’s character. Mulroney’s former chief of staff, Norman Spector, has been subpoenaed; Quebec Premier Lucien Bouchard has indicated privately that he will appear if asked. There are even unconfirmed rumors that former U.S. president George Bush and ex-British prime minister Margaret Thatcher might testify for their old political ally.

Mulroney vehemently maintains that he never took a bribe, or for that matter ever owned a bank account outside of Canada. Which leaves it to the Mounties to prove they had enough hard evidence to warrant sending the now-infamous letter to Switzerland. But RCMP lawyers have already indicated they will use every legal tool in their power to ensure that information that could hurt the Mounties’ on-

going criminal investigation into the Airbus affair is not disclosed. So this part of the case could bog down in numbing procedural wrangling. If, however, the government can prove that Mulroney or people acting on his behalf leaked the document to The Financial Post, Mulroney’s case would collapse and Ottawa would not have to reveal information about the criminal investigation.

Mulroney’s lawyers, meanwhile, will also try to pin the blame for a witch-hunt on the department of justice, Rock— perhaps even Prime Minister Chrétien. In the Mulroney camp’s version of events, the justice minister spearheaded the investigation, personally rounding up kickback allegations against Mulroney from journalists. (Three reporters subpoenaed by the Mulroney team—The Globe and Mails Susan Delacourt, and Mary Janigan and Stevie Cameron, both now contributing editors to Maclean’s, deny providing Rock with any Airbus information.) Again according to Mulroney supporters, Rock then passed the information on to the Mounties, leaving them to act on what the Mulroneyites say was nothing more than unsubstantiated gossip. Furthermore, Mulroney’s lawyers will argue, the department of justice acted irresponsibly by sending an explosive letter to Swiss authorities that they should have known would somehow leak out, damaging Mulroney’s reputation.

The justice department strategy until now has been to circle the wagons. Rock and his officials have been distancing themselves from the Mounties. Rock’s office has released letters designed to prove that the justice minister, who will testify at the trial, was the passive recipient of Airbus allegations, simply passed the information on to the RCMP—and left it in their hands. And in court, the department’s lawyers, who intend to call 15 witnesses, will try to show that everything was done by the book. They will argue that the justice department’s Prost was only doing her job when the letter to Switzerland was sent. Moreover, with 200 similar requests coming from the department each year—not one of which has spilled out into the public domain—they will maintain that the government could not have anticipated a leak. Finally, government lawyers plan to offer up their own theory: Mulroney’s team leaked the offending letter to Mathias as a pre-emptive strike against the criminal investigation.

Then, the Perry Mason moment: Mathias’s visit to the stand. The reporter, subpoenaed by Ottawa, has already said neither Mulroney nor any of his confidants gave him the document. If he refuses to name his sources, he could face a contempt of court charge. And, meanwhile, hanging over the proceedings will be the RCMP’s intermittent, eight-year-old criminal probe of the Airbus allegations. The Mounties refuse to say anything about their progress. Yet the investigation continues—and further fireworks may still lie ahead. The country, Mulroney can be sure, will again be watching. □