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HomeMy WebLinkAbout1982-0513.Debenham.83-11-03IN THE MATTER OF AN ARBITRATION Under THE CROWN EMPLOYEES COLLECTIVE BARGAINING ACT Before Between: Before: For the Grievor: THE GRIEVANCE SETTLEMENT BOARD For the Employer: Hearings: OPSEU (Victor J. Oebenham) J Grievor - and - The Crown in Right of Ontario (Ministry of Consumer and Commercia 1 Relations) Employer E. B. Jolliffe, Q.C. Vice Chairman T. J. Kearney ,Member E. R. O'Kelly Member N. Luczay Grievance Officer Ontario Public Service Employees Union Il. W. Brown, Q.C. Crown Law Office Civil Ministry of the Attorney General January 24 and 25, 1983 February, 10 and 11, 1983 April 19, 1983 June 2, 1983 -2- DECISION On August 1, 1982, Mr. Victor Debenham presented a grievance alleging that he had been dismissed without just cause and claiming reinstatement with full pay and all benefits. The grievance was rejected on October 14, 1982, and referred to arbitration on November 1. The histbry of the matter, however, .began long before 1981 or 1982. It is clearly summarized in Exhibit 3, the docu- ment written on behalf of the employer by Mr. S. Sadinsky rejecting the grievance, part of which is paraphrased in the following paragraphs. Ori October 27, 1977, Mr. Debenham, then employed as an Inspector (Clerk 7) with the Min,istry of Consumer and Commercial Relations, was suspended from duty without pay. He had been charged (with three other persons) with conspiracy to commit fraud and with an attempt to commit fraud in connection with a scheme to defraud the compensation fund established under The Travel Industry Act, 1974, now R.S.O. 1980, Chapter 509 The others charged with Mr. Debenham were Ms. Maria Malinski, - ,3 - her~'former employee, Mr. Harry Snape, and Mr. Frederitik Whiting. z Although the four accused were jointly charged in October, 1977, the case came to trial before a County Court .Judge and jury at Toronto in November, 1981, more than four years later. Ms. Malinski pleaded guilty; Mr. Whiting was found guilty; Messrs. Snape and Debenh~am were acquitted. Soon afterwards Deputy Minister D.A. Crosbie dis- missed Mr. Debenham by a letter --- Exhibit 4, dated December. 18;1981 --- as follows: On October 27, 1977, Mr. R.J. Wltler, then Deputy Minister of this Ministry, wrote you advising that you were to be suspended pending an investigation into the then, allegation that you had been a party to fraudulent activities regarding the compensation fund as established under the Regulations to the Travel Industry Act, S.O. 1974. CXI'November 22, 1977, he further advised that a complete investigation into the matter should not be made until the charges against you had' been disposed of. I am advised that the criminal charges against you have now been disposed of. I have reviewed the information available concerning the charges and your activities at that time related to your positionof Inspector under the Travel Industries Act. I am convinced that your actions indicated a contravention of Section 21 of the Travel Industries Act as well as Section 10(l) of the Public Service Act. In addition, your actions in,respect of the nature and respon- sibilities of your position have compromised your continued employment with this Ministry. ‘ -4 - I am advising you, therefore, that in accordance with Section 22(3) of the Public Service Act that you are hereby dismissed 7 from~ employment effective October 27, 1977. Should you wish to appeal this decision, I wxld refer you to Article 27.6.2 of the Collective Agreement between Manage- ment Board of Cabinet znd the Cntario Public Service Employees Union. It is apparent from the letter quoted above that the decision to dismiss Mr., Debenham was on three grounds~: (1) He had contravened Section 21 of The Travel Industry Act; (2) He had contravened Section 10(l) of The,Public - Service Act; (3) His actions in respect of.the nattire and respon- sibilities of his position had compromised his continued employment with the 'Ministry. The griever contests the validity of all the grounds stated by the Deputy Minister. Section 21(l) of The Travel Industry Act is as follows: -5- 21(l) Every person employed in the administration'of this Act, including any person making an inquiry, inspection or an investigation under section 17, 18, 19 or 20 shall pre- j : serve secrecy in respect of all matters that cane to his knowledge in the a~urse of his duties, employment, inquiry, inspection or investigation and shall, not communicate any such matters to any other parson except, (a) as may be required in connection with the administration of this Act and the regulations or any proceedings under this Act or the regulations: (b) to his counsel: or (c) with the consent of the pzrson to.whom the information relates. Section 10(l) of The Public Serv ,ice Act is as follows: 10(l) Every civil servant shall before any salary is paid to him take and subscribe before the Clerk of the Executive Council, his deputy minister, or a person designated in writing by either of them, an oath of office and secrecy in the following form: I . . . . . . . . . . . . . . . . . . . . . . do swear that I will faithfully discharge my duties as a civil servant and will observe and comply with the laws ~of Canada and Ontario, and, except asp I may be legally required, I will not disclose or give to any pzrson any information or document that comes to my knowledge or possession by reason of my being a civil servant. So help me C&d. The evidence offered by the employer related to three allegations which may be briefly described as follows: -6 - (1) It is alleged ~that the griever was improperly involved in a series of telephone conversations and/or meetings \ with Ms. Malinski and/or Mr. Snape and/or Mr. Whiting, first in respect of Ms. Malinski's attempts in concert with others to ob~tain registration of a new travel agency following the failure of her own agency: second in respect of a scheme whereby Mr. Whiting made a fraudulent. claim against the com- pensation fund after Ms. Malinski became insolvent; and third in respect of a police investigation of the scheme which culminated in all four being charged with conspiracy. This may be called "the Malinski affair: and the evidence relating- thereto consumed most of the time at hearings extending over six days. (2) It is alleged that in June, 1977; when the Malinski agency was still.in business but becoming insolvent, the griever received by telephone a complaint from one Anne- liese Sandner that she had paid $1,085 for a trip to the Bahamas but had no trip and no refund of the money. It is further alleged that, after discussing the complaint with Mr. Snape, then employed by Ms. Malinski, the griever told Ms. Sandner the money was a personal loan which she should recover from c whichwasduly delivered. ought to have opened a f MS. Malinski and also said Mr. Snape had a cheque for her, It is also alleged that the,grlevor ile on what appeared .to be a spurious report~it to his superior, and that the incident revealed an unduly close association between Mr. Debenham and Mr. Snape or Ms. Malinski. On this, "the claim, that he failed to -7- Sandner affair," there is the testimony of Ms. Sandner herself as well-as that of Ms. Malinski and Mr. Debenham. (3) It is alleged that Mr; Debenham improperly disclosed confidential information about the financial status- of a certain travel agency to one Janet~Rogers, who had expressed interest in purchasing an agency in the Mississauga area. This may be known as "the Rogers affair." Ms. Rogers did not testify at the hearings in this case and the testimony relating thereto is that of the griever himself. In support of the above allegations,, the employer's ~counsel called seven witnesses. He also relies heavily on certain documents which were admitted into evidence, partic- ularly: transcripts of tape recordings made by police (under judicial authority) of telephone conversations between Mr.' Debenham'and several other persons, including Mr. Snape and Ms. -8- Malinski: also transcripts of testimony given by Mr. Debenham at his trial in November, 1981. , \ Mr. Luczay and Mr. Robert Burke, representing the griever , rely on his testimony and also on their cross- examination of other witnesses. It is clear that the real issue at the 1981 trial, so far as the griever is concerned, was whether he had been a member of an admittedly criminal conspiracy. On that issue he won acquittal, of which the employer was aware when deciding to dismiss him. Thus no question of criminality arises here. The issue now at arbitration is whether the conduct of the griever at material times was contrary to or inconsistent with his duties and obligations as an Inspector under the Travel Indus- try Act. In the event that misconduct is established, a secondary issue arises, i.e. whether dismissal was, in all the circumstances, an appropriate or excessive penalty. It is always regrettable when there is doubt as to the truth of sworn testimony. Unfortunately, it is necessary - 9 - i’ ..,.. u in this case to assess the credibility of more than one witness. For that reason, the substance of statements made by all>: witnesses must be reviewed in some detail, but only in relation to the allegations made against the griever. At the same time it will be necessary to ~assess the varying interpretations 'given to the words and phrases used in the statute, in certain documents, in telephone conversations and in cross-examinations. At the outset it may be well to explain a-series of events about which there is really no dispute: i.e., the origin and history of the Travel Industry Act, including its purpose; the employment record of the griever, and certain~ steps he took in respect'of Ms. Malinski's agency in the summer of 1977. Thereafter, the facts --- land the significance thereof --- become contentious. From the text of the Act (enacted in 1974) it is obvious that the legislative intent was to-meet problems created by the failure or mismanagement of travel agencies, of.which many, large and small, had come into being. In the ordinary course of business they accept money from clients for the purchase of airline tickets, hotel accomodation, etc. The - 10 - occasional insolvency of an agency can have serious consequences formembers of the ,public., > . 'I Thus the Act in Section 3 requires the registration ,of every travel agent and travel wholes~aler. In Section 5 the Registrar is given authority to refuse to renew a registration or may sus.pend it, if "having regard to his financial position" the agent "cannot reasonably be expected to be financially responsible in the conduct of his business" or if past conduct suggests that the business will not be carried on lawfully and with integrity,and honesty. Salesmen employed must also be - registered as such. Section 13 of the Act (as amended in 1976) now reads as follows: 13(l) Where any prson is entitled to the repayment of any money paid for or on account of a travel service, any travel agent and any travel wholesaler L&O received such money or any part thereof is liable jointly and severally with any other Izerson liable therefor, for the repayment of such money to the extent of the amount received by him. (2) Subsection 1 does not apply here, (a) the travel agent or travel wholesaler has properly disbursed the money received; (b) the travel agent or travel wholesaler has acted in good faith and at arm's length with any person with whom he would, but for this subsection, be jointly liable under subsection 1: - 11 - (c) the parson referred to insubsection 1 who is entitled to repayment of money is entitled to be reimbursed therefor out of) the compensation fund established under the regulations, unelss the travel agent or travel wholesaler would, but for this' subsection, ha jointly liable under subsection 1 with a travel agent and travel wholesaler tie is not registered under this Act. It is worthy‘of note that by Section 10 of the Act "a registration is not transferable." Obviously, the assets of an agency can'be sold, but the purchaser could not carry on business unless and until registered. In Section 26 of the Act it is provided that the - Lieutenant Governor in Council ,may make regulations inter alia "requiring and governing the maintenance of trust accounts by travel agents and travel wholesalers or any class thereof and ,prescribing the moneys that shall be held in trust and the terms and conditions therefor." In recent years a variation of that requirement has been created: a "compensation fund," the terms of which are set out in O.Reg 491/76, ,made on May 26, 1976. The fund is managed by a Board of Trustees representing the Ministry, the Industry and the public. The fund and an agreement with the National Trust Company had previously been authorized by O.Reg. 367/75. These regulations were amended - 12 - by Q.Reg 712/75, O.Reg 599/76, O.Reg 638/76, but O.Reg 805/77 was not made until October 26, 1977, and is therefore irrelevant to the circumstances which led to the suspension of Mr. Deben- ham on October 27, 1977. Later in this decision, further reference will be made to the requirements in 1977 of the Regu- lations as well as the Act. Suffice it to say that the partic- ipation of registrants in the compensation fund was compulsory and each participant had to contribute to the fund. Any doubt as to the validity.of O.Reg 491/76 was set at rest by the :,: '..:' amending Act of 1976, which provided in Section 3: .::. "O.Reg 491/76 shall be deemed to be valid for all purposes notwithstanding that it or any part of it would, but for this section be invalid." .‘.’ :; Turning now to the factual backgrdund, it is clear that for some time prior to July, 1977, Ms. Malinski and her agency constituted a problem for the Travel Branch of the Ministry. The difficulties were reviewed by Mr. Debenham in the following report (Exhibit 10) made to the Registrar, Mr. D.N. Caven, on July 21, 1977: At approximately 1600 hrs. @I July 20th, 1977, information was received from a Mrs. Logan, that she had paid $1,296.00 to Information & Travel Centre for travel cn July 21st. 1977 and had not been able to obtain the air tickets. - ~13 - A telephone call was made to Maria Malinski, owner of the Agency, who advised that she had financial difficulties, and that the new capital that was expected to be put into the company did not materialize. An inspection of the company '- ? was agreed to be made on July 21st, 1977. Since February 1976, Information & 'Travel Service have been reported by various wholesalers for issuing N.S.F. chegues, and arrangements were made that the company would give only "certified chegues" to wholesalers for the purchase of tours. 011 February 23rd, 1976, I visited the offices, and Maria Malinski produced an Accounts Receivable list showing the company was owed $25.714.71 against which she owed $4,500. The previous owner of the company left a lot of debts (approximately $18,000) and since that time, Maria Malinski has had a cash flow problem, and has second and third mortgages on her property to help the company finances. For the past year, the company has been under cur inspection and the accounts that were produced showed that the company as at January 31st. 1976, had a surplus of $477., but by June - 30th, 1976, there was a loss of $10,187.00 with a loan from Maria Malinski fo $13.052.00. After a further six months' operation, the loss was approximately the same, $10,412.00 lzt the loan by Maria Malinski had been increased to $16,672.00. Ixlring 1977, the company was again requested to produce accounting statements, and the 30th of April, 1977 unaudited accounts showsd a deficit of $5,691.00 but the 30th of June, 1977 statement, gave a loss of $21,000.00. Luring the inspection carried out on July Zlst, 1977, it would appear that claims for $45,210.00 will be suhmitted by consumers for consideration by the Trustees of the Compensation fund, and I muld recommend that a full financial investigation be carried out of this company. lhe cmpany's records are being~held by Eerman & Lofchick at 491 Lawrence Avenue West, Suite 301;Tbronto. and Wr. Lofchick will return from leave on Monday the 25th of July, 1977. ;, - 14 - Previous financial statements prepared by a Mr. Ken King had not been acceptable and Ms. Malinski's books ani records were in the hands of Messrs. Berman and Lofchick, accountants. They were delivered to the Travel Branch on July 25 at the request of Mr. Debenham and an investigator from the Ministry. On April 21 Mr. Debenham had sent Ms. Malinski a registered letter, Exhibit 32, requiring her to."show cause" why her licence as a travel agent should not be revoked.. .on or about July 26, Ms. Ma.linski surrendered her licence to Mr. Debenham, admitting that she was hopelessly insolvent. Nevertheless, she was soon making plans with her former employee, Mr. Harry Snape, to re-enter the travel business, presumably as an employee of a registered travel agent or' wholesaler. Mr. Snape~found an associate, Mr. Fred Whiting, and made application for registration in the name of Happy~ Face Tours Dated July 27, 1977, Mr. Whiting signed a claim (Exhibit 1.2) addressed to the Registrar on the prescribed form. - 15 - The first paragraph alleged that Information & Tr,avel Centre was "a, participant in the Compensat,ion Fund under the Tr?vel \ Industry Act," which had been true. The next paragraph alleged: 2. 'Ihz Client has made paymerits totalling $9,000.00 to the travel agent for the provision of travel services. It is now agreed that the above allegation was totally false. Attached tb the claim was Invoice No. 159 addressed to Mr. Fred Whiting and signed.by Ms. Malinski. It contained the following words and figures: 180 x !TOF0NlV/oRLANt0 RT EAL, Sept.2/5, 1977 Re: "LITTLE LEAGUE BASEBALL TEAMS" ANNUAL OUTING: ORLAMX), FLORIDA Deposit cash Received $9,000.00 Thmk You. Also'attached was a receipt numbered 31244, dated July 8, 1977, as follows: Received from Mr. F. Whiting Nine '&ousand --- co/co Dollars 180 Dep. a. $50 - on Little League Gnxp - EAL - Sept. 2/5 Orlando $9,000 -- - 16 - Ms. Malinski subsequently admitted in court and > again at this arbitration that no money was paid to her bk Mr. Whiting. In the result she pleaded guilty to the conspiracy charge and Mr. Wh'iting was found guilty by a jury. As previously noted, however, both Mr. Snape and Mr. Debenham'were acquitted on the same'charges. It must be made clear that the employer's case against the griever in this arbitration is not based on the charge of conspiracy, which the Crown failed to prove. It is based on his relations with Ms. Malinski land Mr. Snape, which are alleged to have been inconsistent with his obligations as a public servant --- and .i,n particular with his responsibility as an Inspector under the Travel Industry Act. The evidence in support of that allegation consists largely of a series of telephone conversa.tions recorded by police interceptions and also the griever's admissions in cross- examination. Much less weight is attached by the employer's counsel to the testimony of Ms. Malinski, whose credibility is to say the~least --- somewhat doubtful. - 17 - Following the surrender of Ms. Malinski's licence > a numberof claims were submitted to the compensation fund, the largest being Mr. Whiting~'s. It was not part of the griever's duties to investigate such claims. They were referred to the investigation branch of the Ministry, headed by Mr. David Mitchell, who has.had many years of experience with the London Township Police, the Ontario Provincial Police and the Ontario Securities Commission. He is charged with the enforcement of 13 statutes relating to business practices and has a staff of 30. Early in September, on receipt of information from the Durham'Regional Police that the Whiting claim was fraud- ulent and that a person in the Travel Branch "might be involved," Mr. W.D. Smith wasassigned to investigate. As a result of his inquiries the Metropolitan Police were asked to help and on September 14, Staff Sergeant Brian Cowperthwaite of the Fraud Squad initiated what seemed to be a meeting by chance in a tavern with Ms. Malinski and one Rudy Schade, owner of a~ restaurant. Both men pretended to be eager to invest money in the Travel business. Ms. Malinski was already engaged in booking tickets for clients through a registered agency, but - 18 - she was in desperate'need of cash to meet her persona obligations. , The detective .and Mr. Schade (who was actually an informant) arranged a private meeting with her in a motel room at Oshawa on, September 21, ostensibly so that they could become ~. better informed about the business. There was a supply of liquor as well as sandwiches and Ms. Malinski spoke very freely of her problems and the mistakes,she had made, including the false receipt she'had given Mr. Whiting. She was remorseful and worried about the investigation she knew Mr. Smith was - making. Almost all of the conversation between 6.20 p.m. (when she entered the detective's car) and 9.20 p.m. (when the three went from the motel room'to the motel bar) duly found its way to the Tape Recorder the detective was wearing at the time. .It was of course transcribed and is in evidence as Exhibit 16, 97 pages of typescript on 14-inch paper. Probably distraught by her problems and possibly under the influence of alcohol, Ms. Malinski's references to Mr. Debenham where not entirely coherent or consistent. She said shethoughthe was to share in the proceeds of the ~Whiting claim "but I have.no proof." Asked if he knew about it, she said "That I still haven't found - 19 - out," whereupon the detective said "Jeepers!," she said "I don't know," and he said "Oh God!" (page 42 of Exhibiti \ 16). She was advised not to accept any of the money if the Whiting claim succeeded. Immediately after that meeting, Staff Sergeant Cow- perthwaite obtained authority from Mr. Justice Robins to inter- cept telephone conversations to and from Mr. Debenham and several others. At the outset of the hearings,in this case, Mr. _ Luczay, representing the griever, took objection to use of the tapes made and transcribed by the police in October, 1977. If 'they were admissible, he' argued, thenall the tapes should go in. Mr. Brown tendered tapes of conversations between other persons as well as those to and from Mr. Debenham, and pointed out that they had been ruled admissible at the conspiracy trial. Of course this proceeding under the Crown Employees Bargaining Act is not concerned with the conspiracy issue. What we are concerned with are the words and deeds of the griever himself. It seems clear to us that his telephone conversations, lawfully intercepted as they were by judicial authority, are both relevant - 20 - and properly admissible. Of course the remarks he made and his explanations when cross-examined must not be taken out of context. The context can be as important as the words used Before proceeding further, we find it necessary to offer two explanations. The first is that in assessing the nature and quality of the relations between Mr. Debenham, a public servant, and other persons who were not public servants, the Board does not rely on isolated passages in the evidence, but rather on the - evidence as a~whole. That evidence includes 141 pages of the transcript of histestimony at the conspiracy trial in November, 1981. It also includes.51 pages transcribed as a result of telephone calls he made or received at his office or his -home, which are collected in Exhibit 38.~ It is impossible to repro- duce such voluminous evidence in a decision of this Board, but much of it has been helpful in reaching our conclusions. We do not refer to the transcripts of other telephone conversations such as those between Ms. Malinski and Mr. Snape or between thelatter~ .and Mr. Whiting, which cast light on their behaviour but very little, if any, on that of Mr. Debenham. . <). -21-. .-_ . . -:,, .,..:,.‘ : .‘,: At our hearings, the griever was examined in chief for an hour on February 11 and another hour on April 19, after which he was cross-examined for almost three hours on tha; day and April 19, further cross-examined for an hour and a half on June 2, and then re-examined by Mr. Burke for about an hour. That testimony was not transcribed. but Board members made copious notes. We think it fair to say that Mr. Debenham's testimony before. us was substantially'the same as the testimony he gave at the trial in 1981. For reasons already mentioned, we do not propose to - quote extensively from the many thousands of words in evidence. Nevertheless, it seem.5 proper to. refer to cer.tain passages Mr. Brown, counsel for the employer, has emphasized in that they illustrate --- at the very least --- lack of the judgment and discretion expected of a public ser.vant in a responsible position. Mr. Brown relies in particular on certain telephone calls and on cross-exam'inations relating thereto. These relate to three areas: Mr. Debenham's awareness of Ms. Malinski's efforts to remain in business --- notwithstanding her insolvency: his'awareness of the Whiting claim;~his awareness of the invest- igation conducted by the Ministry and the,police. Examples may - 22 - now be given,, although the Board is not overlooking the context. i On October 14, 1977, the investigation by the Min .istry and the police was well under way. Mr. Debenham had heard of Mr. Smith's inquiries but not about the police. He was also aware that Ms. Malinski had been trying to re-enter the business by promoting two applications for registration, one in the name of Travel Express, financed by a Mrs. Boyczok, the other a wholesale agency in the name of Happy Face.Tours, in which the principals were Messrs. Snape and Whiting. She was also interested in working with Mr.. Ken King, who had formerly helped with her book-keeping and whose daughter had a travel agency business. By October 14, Ms. Malinski had decided she could not work with Mrs.Boyczok and abandoned that project. It was no part of Mr. Debenham's work to process applications but Ms. Malinski seemed to think that since he had often helped her out of trouble in the past he was the right person to con- sult. That is the context in which the first part of their conversation occurred on October 14 and, as appears at pages 1 and 2 of Exhibit 7, it was as follows: Victor Hello. Can I help you? Maria Hi, dear. V. who's that? M I heard you were sick. ‘ - 23 - V. Yes. I have been. (Laughs) M. OmyGod. Don't get sick on me, will you? V. No. No.~Er. in fact I had lunch with, er, Ken King todiy. M. V. M. V. M. V. M. V. Yeah. He said everything was coming along very nicely. Well, er, except, er, I wish he would, er, er, um, forward the 340, you know. urn. Well, I think all he,is worried about at the present moment iS there is an affidavit that has to be signed. And, er, as .soon as he gets his daughter to do that . . . . . Uh hu. Er, then I think, er, you know, there is no problem. Yeah, Yeah. Well, I have a letter here to the effect that Travel Express is deceased. Um. Yes. I did hear that, although I haven',t, I havn't (sic) M. Seen it. No. Well. I still got it here, ard I gotta go down there, and, um, somehow get it there, you know. V. .Well, just put it in the post. M. Yeah. I guess so. V. It will be alright. There will be no problem. M. Should I register it? V. Er, no. I don't think so. M. . No? V. Urn, you know. She'll obviously want her money back. M Ye&. of cmulse. This is the problem. v. Yeah. Well. 0n,, in the letter does it say "Would they please M. V. M. V. M. V. M. refund the monies"? Yeah., No. It doesn't. Well..... I didn't... I didn't want so bold. Yeah. F+o. Ycu should put in that because, as the application didn't go through..... Right. 'Iban, er, they should get the money..... It was never in existence. V. M. That's correct. Well, whatever she put out for printing and so on. Well she just has to lose, that's..... V. Well. 'Ihat's~somethirg different. M. Yeah. V. In business you take the good with the bad. M. Right. Right. c - 24 - V. M. V. M. V. M. V. M. V. M. V. M. V. M. V. Yeah. wit I think that was the only thing to do. Yes. No... . . . I realise that you can't talk now. Yeah. i Er, um, could you phone me in the evening, maybe? It's difficult. Yeah. I know. (Laughs) why don't youhave a word with Ken, because I'm pretty sure, you know, everything's alright. Yeah? Yeah. OK. Do, do you want his number? Er, Igothis number. Yeah. OK. Have a word with him, because I think all he's gonna do this wieekend is to get the daughter to, er, make the necessary signature. The flavour of the Malinski personality was adequately conveyed in the foregoing conversation, as indeed it was also by her testimony before this Board. In cross-examination Mr. Debenham (pages 66-67 of Exhibit 8) denied that he had a special relationship with Maria Malinski: Q . . . Perhaps you could go over for me again -- I know that you've gone over it for my friends -- but how do you know Maria Malinski? A. I don't, to be honest with you. Any occasion that I had of meeting Maria Balinski was in the course of business with the Ministry. - 25 - Q. A. Q. ;: :: A. Q. A. Q. A. Qi A. Q. And she's not a friend of yours? i-40. > Yau have really no interest in her well-being beyond :\ business interests? lhat's axrect. Ard you'd have no reason to have contacts with bar beyond that business interest? Correct. You'd have no reason really, to solicit employment for her, would you, sir? Well, no. We weren't looking at the employment for her; we were looking for the people that she, like her following, and this sort of thing. In other wxds,we were trying, I think, to smooth out, you know, the travel business, to keep it nice and clean and keep things out of the papers. We have.heard so nn.rch about the complaints Maria Malinski and the fact that ya visited her. She had an awful lot of complaints, sir, you muld agree with me?. Yes. And so whatever her following was they weren't being wall served because she was having an awful lot of complaints? Well, that is correct. But every time we bought a complaint, she m&e sure that the people got their tickets. And again at pages 83 to 88: If I understand your evidence correctly this morning, Mrs.' Malinski wasn't a friend, she was a business associate? Correct. . . . . . So you're helping her to go with Ken King then, if I under- stand, because she's talking about King, and if you look at the rest of the conversation, it seems obvious that you're trying to set her up with Ken Wing? . . . . . - 26 - A. Q. A. Q. A. Q. A. Q. ;: \ ;: A. Q. A. Q. A. Q. A. Well, first of all, I think we have got to realize that Mr. Ken King had an intimate knowledge of this agency because he had prepared that financial statement for her?. So there muld be nothing wrong with discussing that. 'I Mr. Ken King is also a business man. What I'm asking you, sir,-- and I'm not trying to cut you off, you can give your explanations afterwards -- but I'm asking you if you are talking about setting her up with Ken King? Yes. I'm not interested in the reason behind it for the moment. Yes. So you're talking about setting her up with Ken King in this conversation? YeS. Now, Ken King is not involved with Happy Face? No. You told us this morning, I believe, that you thought that Maria Malinski might go with Happy Face? That is correct. ll-is is October 14th. Happy Face,is around the same time, sir; are we talking about different time periods? We are talking'about two different things. One, if she went with Ken King, she would be a retail travel agency. If she was goingto Happy Face Tours, she would have been'part of a wholesale agency which are entirely different things. Do you take this much trouble with other people who go out of business, sir, and try and set them up? We have done, yes..... Let me ask you this. You don't indicate there that you won't 'phone her in the evening, you indicate it's difficult; so there muld be a possibility that you might have 'phoned her? I think it was a kind of brush-off, to, be honest with you. I didn't really want to have anything to do with her because I changed my conversation straight away.and say: Why don't you have a word with Ken, try to get rid,of her. You didn't want to have anything to do with her? Well, no. Not at home and this sort of thing, no. The evidence indicates that a,lthough Ms. Malinski was not an efficient business woman, she had a following, particularly among members of the,public travelling to a& from East Germany. According to her, she had gross sales averaging $500,000 a year, which would yield an average of about $50,000 in commissions. She failed to maintain a trust account and candidly admits that some of the payments she received from clients were~'used to pay off other obligations. Mr. Snape, who had worked for her, and Mr. King (who had done some book-keeping). were well aware of her weaknesses,~ including alcoholic habits, but apparently wished to take advantage of her long experience in the travel business and her selling ability. On his part, Mr. Debenham claims his only interest was in helping her to get re-established after the failure of her own agency. AS he understood directives given the Branch by the Minister in 1975 or 1976, one of its functions was to help agents to "keep out of trouble" as well as the function of protecting-the public from losses due to the mismanagement or failure of travel agents and wholesalers. In his position as an Inspector, Mr. Debenham had no responsibility for processing applications for registration or claims against the fund --- and no responsibility for - 27 - - 28 - investigating suspected fraud, which was the job of another Branch in the Ministry, Mr. Mitchell's Branch. Mr. Debenham did have the duty of inspecting agency operations and reporting irregularities to the Registrar;Mr. Caven.- It Seem.5 clear that he was also expected to be well-informed about what was going on in the industry. Thus --- as Mr. Caven knew --- Mr. Debenham had used Mr. Snape as 'an informant, the latter having widespread contacts among agencies. 'There were frequent calls from him reporting the latest gossip. The advantage of such a relationship is said to be that it alerted the Branch. in advance to the troubles which frequently arose. Unfortunately for both, Mr. Snape in the summer of 1977 formed an association with Mr. Whiting and the result was the application forregistration of "Happy 'Face Tours," an application which apparently languished on the Registrar's desk in October.while the police were looking for evidence against both men. Mr. Debenham had nothing to do with processing the. application but he was aware of it. He Chad also been aware since July of the Whiting claim, which he says was regarded in the Branch as somewhat absurd. Mr. Snape tried to keep in touch with the griever, hoping that something could be done about the c ‘.’ . - 29 - Happy Face application. On October 13 Mr. Snape called the. griever, who was at home recovering from influenza. In their conversation there were references to the Registrar and to Mr. Whiting, without naming them, also to Ms. Malinski and Mr. King In the following partial transcript (pages 1 to 3 of Exhibit 14) the letter V designates the griever and the letter H is Mr. Snape: H. V. H. V. H. '. v. H. V. H. V. H. v. H. V. H. V. H. V. H. V. When do you think you might be back? Urn. Well I'll definitely be back on Monday. I might be in tomorrow, Harry. Yes. What are you after? Have you got your licence yet? No. Its sitting on his desk. Really. Yeah. A& I'm getting desperate. I wonder, you know, if he's er just being bloody awkward. .I don't know. He . . . . . He definitely went in and had a look. I had to tell him who it was. You know. Yes. HZ said, this was yesterday., Yes. He said you weren't in, like. I asked for you. Yes. And then he said, "Yeah". Ha came back about five minutes later. & said "Its there, on his desk." (Unreadable). Ycu klow. All joking aside. I don't think he's got anything against you. Or anything like that, you know. Urn. I see no reason, if its on his desk, I don't see why (Unreadable). Ihe only thing you know, um, I looked at that bloody thing, you know, tiich you put infor 18,000, um. Yes. And although 18,000 sounds a lot. Thats his whole wealth, you know. What would have been better for him to have said that he's going to pit, you know, 20,000 in to start the ampany - You knowwhat I nean. - 30 - H. v. H. v. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. Y&. Then made a directors.... 'R-en they'd have said "Where is it". 2 Thats alright. You know. Made a directors loan. But, : yau how, I don't know what his feelings are these days. Ycu know. Wit be was always looking for about 10,000 before. Well listen. What did he do to Maria? There's 10,000 cash. Eh. l'here's ten cash there. Yes. 'Pall me what did he do to Maria? Co you know? Er. Nothing. No. Did he give her the licence eventually?, No; No. No. No. She's got a letter together now. Registering it and she's cancelling out the business. Is she? Yeah. Isaw it today. I see. Sk's not.... No. 'lhe other girl backed off. oh. 'Ihats bad, because thats a good little place there ya know, Harry. Yes. I know. I know. Yes. 'rm bad. I believe Kenny's still interested. Well. I think Ken's stupid. You know. He went off last week on a bloody. joy ride when he could have made money. Right. Right. Yau know, I said to him a couple of times. You know. You know. Lets-get cracking. So whats Maria going to do, for Christs sake. I don't know. She wants sxnebody to act as a branch office Yal know. Its the only thing she can do now. Well, I'll.@ me thinking cap on because there must be sodxdy that will take her, anyway. There was another telephone cali on October 17 from Mr. Snape to the griever. The former was anxious to know.what Mr. Caven was doing with the Happy Face application, for which II I , - 31 - Mr. Whiting had to show financial worth. Part of -the conver- sation (Exhibit 38, Tab. 6) went as follows: > I* H. V. H. V. H. V. H. V. H. V. H. V.. H. So you've no idea whether its favourable or what? I don't, to be honest with you, Harry (Unreadable). You see, what I'll do is, just ask him if its progressing. YOJ know. Yes. No, I can't see how hecan turn him down because he% got everything. Yes. He has. He might say "Well I want $10,000 in to open the thing." But you can always put that in one day and out the next. Thats right too. Yeah. Yeah. Yeah. So I wouldn't worry too much. Ah. OK then. I just thought I'd check with you first. OH Harry. Thanks qain;eh. The.grievor's apparent intimacy with Mr. Snape led to considerable cross-examination at trial in November, 1981. Answering Mr. Snape's counsel .(at pages 55-60 of Exhibit 18) Mr. Debenham explained that the relationship was one of a public servant and an "informer" or "informant" --- particularly in connection with tickets sold in the Chinese community, which were also under investigation by the International Air Transport Association. Mr. Snape had been employed by a Chinese travel agency at the time. . - 32 - The following appears in cross-examination by the Crown at pages 73 and 74 of Exhibit 18: 2 Q. A. Q. A. Q. A. Q. ii: i: i: A. Q. A. Q. ;: .A. Let's turn to Harry Snaps now. You indicated to my friend that you knew Mr. Snape as a hsiness acquaintance? Correct. And you also indicated that he was a type of informer, if you will? Yes. . . . . . . Were you a friend of Mr. Snape, Mr. @benham? Not in the meaning of the ward "friends". I term a friend, and I might be terming it wrongly, is scmebcdy who comes to your house, knows your family, you go to their house, this sort of thing. Mr. Snaps was not like that. We knew each other, you know, we were friendly to each other but not as a‘. friend or a pal. You contracted -- the 'only -- let me put it to you this/way. You'd contact Mr. Snape if you wanted to find out gossip in 'the mmmunity about the travel industry that you didn't have any information on or a travel agency; is that correct? Correct. You'd contact if perhaps you had a problem with whatever he was dealing with, correct? Yes. What else would you contact him for, Mr. Debenham? I don't think I have. Well, I'm asking you, what else would you -- would you have contacted him for anything else? No, not as far as I know. 'R-e only other pi-haps relationship you had with Mr. Snapa is with respact to Happy Face; is that correct? Yes. I knew he was making an application for a wholesale com- pany in the name of HapW Face Tcurs. Ycu'knew he was making the application? * Yes. Yes. Who was handling his application? Who was handling his application? Well, it would go to the Registry Office and then eventually Well, it would go to the Registry Office and then eventually have to come up to.Mr. Caven. have to come up to.Mr. Caven. - 33 - There is no evidence of any conversation between the grievor and Mr. Whiting. Nevertheless, in view,of the Si,ape- Whiting association in Happy Face Tours, the grievor was vigor- ously cross-examined at pages 78 to 81 of Exhibit 18: ,Q. A. Q. A. .Q. A. Q. i: A. Q. ;: A. And Happy Face Travel, you already told us, was composed of ~Mr. Whiting and Mr. Snapa? . To the best of my knowledge; yes. . . . . . Now, we have haard a lot from Mr. Burke when this Whiting claim came in and all of the laughing that wsnt on in the office about this claim, that it was obviouslyfraudulent, obviously there was something wrong with it; you would agree _ with that? Yes, I would agree. At-d you yourself said it was a~ joke, right? correct. And this claim was a claim submitted by Red Whiting, right Mr. @benham? Yes. What are you doing advising Harry Snapa and Frederick Whiting in October of a year with respect to a travel agency when you know that Mr. Whiting is involved in an attempt to defraud the Travel Industry E'und; can you explain.that to us? This was an application that had been received and it had to go through its normal processes. I can't come out and say as the Government's employee probably what I would like, I've got to keep tongue in cheek. Mr. Debenham, you're saying here to.told us that you told (sic) Harry you would push it through. You said that before --- Well, I indicated I muld try and hurry up his application, yes. All right. So what you're doing is your trying to hurry up the application of Mr. Harry Snape and Mr. R-ed Whiting and you know that Mr. Fred Whiting is involved in an attempt to defraud the Travel Industry? No. Because what would happen, what I'm saying is that I would try and hurry up, is get some decision for them. I didn't have Q. ;: A. Q. A. Q. :: A. Q. A. Q. A. Q. A. - 34 - any decision to make as to whether Mr. Caven wxld approve this application of Happy Face. i . . . . . You were dealing with Mr. Snaps but you knew Mr. Whiting was involved; you've already told us that a number of times? Yeah, but he hadn't --: I Haven't you already told us that you knew Mr. Whiting was involved on a number of times, just answer that? With Happy Face Taxs? Yes? Yes. So in helping principals of Happy Face Tours then you were helping the Happy Face Tours and the principals of Happy Face Tours were Harry Snape ard Frederick Whiting? Correct. Ycu testified that &en Mr. &rke was talking to you, you testified that when you came on with the~Ministry, you were concerned wt this Travel Industry Act? Yes. I think we all were, yes. Ard you were concerned that it was administered properly? Yes. I think it was quite a good Act. Anything for the better of the public. Ard you don't see any problem with discussing Happy Face with Harry.Snape and suggesting to Harry Snap+? you're going to try and push it through? Well, I think at that time, nothing had been proved about Mr. Whiting's claim. Well, you said it was, nothing had been proved, sir, but you told us this claim was a joke. 'You said it was doomed to failure? Well, that's fine. But that's vastly different,.you know, from being a lawyer, that proving a thing is --- No question about that. A man is innocent until proven guilty. En& what I!d like to comment on for this jury, that you knew, that this claim was a joke, youknew it was fruadulent and although it may not have been proved, you're dealing with these men and you're putting them, you're trying to assist them to register in the travel industry? Well, it would be very improper of me tc have gone to Mr. Whiting and say to him,‘your claim, we think is a fraud, I can't - 35 - Q. A. Q. A. Q. ;: A. Q. A. give you an application form for a travel agent because there is nowhere in the Act here until he's convicted where he can be turned down, No, I agree with you, Mr. Cebenham. It would have keen irn- proper, but you told us that you weren't handling this application so why get involved in it? Well, just as a matter, because Mr. Harry Snaps, hho I knew, asked me if I muld have a look into the application for him. Ard you didn't care if Harry &ape was involved with Fred Whiting? No. I don't think that was the issue at that time. It was an issue, the agency was going to be licenced or not. Well, all right. If the agency was licenced then you'd then have an agency licence with a EYed Whitirq tie was attempting to defraud the Fund to your knowledge? Well, it hadn't been proved at that stage. Well, fine then. If it hadn't been proved then at that stage, you're suggesting then that that claim could have been legitimate, it could have succeeded? I didn't do the investigation. Could this ‘claim have succeeded? In my own mind, no. There were also many questions raised at trial (and before this Board) regarding the griever's awarenesS of Mr. Smith's investigation as well as his awareness later of the police investigation and the comments t~hereon he made by tele- phone to Ms. Malinski, Mr. Snape, and Mr. Ken King. Ms. Malinski's call to the griever on October 14 has already been quoted in part. After discussing the application in which Mr. King (not Mr. Whiting) was involved, she suddenly raised a new point, as follows, at pages 3 to 5 of Exhibit 7: M. V. M. V. M. V. M. V. M. V. M. V. M. V. M. V. M. V. M. V. M. V. M. V. M. V. M. a V. M. V. - 36 - Mr. Smith was here again this mornirg.~ Really? And he said that "Co you know the word 'Fraud"'? I said<."Yes"., ba said "Do you know the word'ccnspiracy"'? I sati "hko".i Really? Oh hu.. Well, it, it maybe, um, there was a woman that they phoned up, evidently, and, urn, she said that she had been on a tour to the far east, and so they didn't want to claim. I% you know any- thing about that? I lent the money from someone, and I paid for it. That's right. Yeah. You see. Because she didn't have the money to put it otit again. I see. Well, that's what he might be talking aboout.~ No. He wasn't talking about that one. OK. Which one's he talking about then? He want tomy house this morning nine o'clock. Yeah. Smith,, and, er, he &me 'conspiracy' and 'R-aud', and so on. And I said, "Look. I don't know what the hell you're talking about." Yeah. Yal know. Fr. Listen . . . . . Can ycu just hold the line a minute? Hold on. Yeah. (Victor Debenham leaves the phone. and returns a minute later~) Sorry about that. Yeah. Its OK. OK. Rut I would certainly have a word with Ken, because I'm pretty sure everything is OK. OK. Now..... Losk, anyway, what happened when he came to the house this morning, then? Well, er, he showed a badge, constable, you know, constable. Yeah. Ycu how. And be said, er, well, he came here and he, he, he keeps harassing me. Now. I have a case with Skytrain, for instance, yc~ know. Yeah. An3 I, I don't have my files. And I wish I get my files back, because then I know what, er, chegues, &at customers chegues I tOOK Over. Well, urn, yeah, OK, you can make an application. Just write an ordinary letter and bring it down here and ask them for the re.... to be returned, er;, and they can make copies of all the original then. - 37 - M V. M. V. M. V. M. V. M. V. M. V. Ii V. M. V. M. V. M. V. M. v. M. V. M. V. M. V. M. V. M. V. Yeah. Right. Alright? i Because, erfyou see, I..... I mean this was back in July: you know. Well. There's no problem there. Just, Just, er..... Well he's refering to Fred Whiting, you know. tie said, urn, er, why he turned over $9000 to me, and so on. You know? Yeah. He's harassim me. But, you know, er, I'm just playing, er, stupid. Yeah. Yal know? No, just, just, er, on, just on this one, you know, as far as I am axcerned there's no problem ti?itsoever. I know. I know. It's a large amount. Yeah. But, er, just write a letter just asking for them to be returned, or copies, returned to you. Yeah. Because my lawyer needs those copies. I, I, I don't haves it in my head to pay. You see, I turned over time customers cheques, over to Skytrain. Ad, of course, I don't remember them all. No. No. Yml know? Just put, er, just put a note on there, er, you know, these are the reasons ycu want..... Ycur lawyer requires them. Right. Alright. &t put it on your old company'letterheaded paper. Old company? Yeah. Informatiofi ard Travel, you mean? That's right. Yeah. Ch, I see. Alright. Listen . . . . . It's still in existence, isn't it? It hasn't gone out of being? No. Er, as a, matter of fact, I'm gonna register it under a new name. ccod. OK, my dear. Er, you're not coming out this way, by any ChatICe? Er, not tcday, to be honest with you. I'm going home for a quiet weekend. (Laughs) No. I know that. ht probably Monday. i . - 38 - M. Monday? V. Yeah. M. Er, could you make a point of it? V. Yeah. No. 1'11 give you a ring on Monday. M. Please. V. Alright. M. OK. It muld be really important. V. Yeah. OK. Lcok after yourself. M. OK. Honey. V. Yeah. M. OK. Have a nice weekend. V. Sane,to you. At pages 88 to 97 of Exhibit 18 there is an extremely confused series of questions and answers in the Crown's cross- examination of the grievor, interrupted by argument between - counsel; it was ruled that the jury should hear the tapes again, after which came the following questions and answers at pages 97 to 99: Q. EQZS that assist you or can you explain what --- A. Yes. I think I was trying to get her off the subject of the $9.000.00 and just trying to get her back to the fact that she could make application for her original files. Q. wit I'm concerned about the part, you say: "Well, just on this one, you know, as far as I am concerned there's no problem ts+xtsc.e"er. 0' A. Wall, I couldn't very well tell her at that stage there was a problem. Q. Well, I already made the point, Mr. Dabenham. I already asked you about what, why you had come back to the conversation with her when you had an opportunity to break it and you already indicated that you wanted to be polite. A. Well, I just think that was just a point~of curiosity because there is two different departments in the Ministry. Q~. A. Q. A. Q. A. Q. A. Q. A. - 39 - &e is the Investigation and one is like the !lTavel Industry Act. And since the Travel Industry Act was set up, we$ad great difficulty in getting information out of what was:going on in the Investigation Department, so this was, you k&w, just a simple --- So you were curious? Yes. So you were discussing a~case that was,under investigation with one of the parties who would have been involved because you were curious? Well, I may have done wrong in looking back now -- you're probably right -- I probably should not have brought the sub- ject back up again, but that's hindsight. At that time, 1,think I had an interest to see just what was going on. I didn't ask of specific things &out the claim, I just'asked her what had gone on. All right. Fine, Sir. 'Ihen, so then when you told Mr. Burke this morning that you didn't want to get into the subject and you were trying to steer away from it, you're telling us now that's not correct because in fact, you were curious atout it and you wanted to know? I think there is two different subjects. One was when she told me that Mr. Smith h&d been to her place that morning; I think .it is natural to follow on and say what happened. It's just idle curiosity. I stand to be corrected, and I probably did wrong in doing this, looking back, tut I don't see anything wrong in that, to be honest with you. Except that, sir, except that -- let me p&t this out to you. Maybe you can explain this. It might have been idle curiosity with respect to Mr. Smith, hit again, I bring you back to the point that she was leading into an area that was confidential, an area that was under investigation, an area that you were duty tcund and sworn to stay away from; isn't that true? yes. I've said to you I probably made a mistake on this one, but nobody is perfect. Well, that's true, sir. You can't 13e faulted with that. 'IhBnk you. Of more importance are three conversations on October 19. The first was at 10.05 a.m., when the griever called Mr. - 40 - Snape from his office, a call he said was made at the request of Mr. Caven. It appears at pages 25-26 of Exhibit 6:;: V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. H. V. H. Fkw are you this morning? Not bad. Listen. 'Ihere's lotsof rumours going around that dear old Maria was arrested yesterday. Have you heard anything? lhats correct, yes. What yas she arrested for, do you know? Fradulent conversion. Fraudulent conversion? Anythling to do with the fund,,or any- thing? There's somebody tie seems to have phoned in here and said that she was charged with fraud against the fund or something. No. No. The way I read it was fraudulent conversion. lhey were here at 11 o'clock the night previously. Wtm? Whenyousaythey . . . . %Y. That was Mr. Smith and er another Sergeant of Detectives. I see. And I knew him. Yeah. From way back. So we had a little chat and he said "Well the ~' only thing that we see...." Fraudulent conversion of the company? Not the fund? Eh? Fradulent conversion of Information and Travel Service? Yeah. Misplacement of funds. You know. Yeah. Funds that ware destined for clients. Yeah. That she used for other things. Right, OK Harry. And I was supposed to meet her, er, yesterday and when I got down there she had already gone. OK. I'll come back to you later on. Please do, will you. The grievor called again at 10.22,a.m.. page 27 to 29 of Exhibit 6: - 41 - H. V. H. V. H. V; H. " v. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. v. H. V. H. V. H. Hello. Harry. Yeah. i I'm downstairs now so I can talk a bit better. \ OK, Yeah. Listen, eh. How tight is she. She, er, you know. Will she shout, or. No I don't think so. Oh OK. I don't think they've got much on her. Ycu.... , No, they haven't. You see. Except she accepted money that she paid off other bills. That's right. \ Unless they've got something specific. You know. I'll try and find out later on. No they haven't. The way they talked to me. Yeah. And said %ell we don't see any other recourse, you know that to charge her we may go down tonight." Yeah. Atrl I didn't phone her. She phoned me yesterday morning and _ she wanted a lift downtown and I said I would be there about a quarter after twelve. But at a quarter to twelve she had gone, and I said to her "Did you, er, make out alright last night?", and she said, "What do you mean?", and I said "Well, they were coming down to see you and, er, they were talking about arrest;" Yeah. "13 CM" she said, you know. Yeah. And I said "Well, listen. Don't panic. Don't worry about it. Ycu have legitimate cause because you paid out Ahmed." You know. Yeah. Thousands of dollars, which her lawyer has,, by the way. Yeah. Of amounts and dates, you know, which is far in excess, you hOW. Its about 18,000 - 20,000. Yeah. Well tell her if she wants any of her records back now, stt? can demand them, because, urn, you know. For her defence. Right. I wondered about that. Yeah. So that she.... Because the lawyer asked me. I made up a statement for him, you know. - 42 - V. H . V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. Yeah. I mean, she can demand them back.... ix-d this is what he wanted. A Without any trouble, you know. I\ ml. ml. Ok Harry. If you want anything, give us a shout. Incidentally, what did Caven, he doesn't speak to me much these days. What? .What did Caven say'to you yesterday about.... Oh. He said that he had sent it in into investigation which is the liormal procedure. Yes. When a new face appears. Yes. And I said "Oh dear, what are we looking at now. 4 - 6 weeks" and he said "Oh No, no, no, no, not that long. No maybe about 2.2 to 3 weeks. I see. Yeah. Oh well. Keep your fingers crossed, mate. Yeah. Well, listen, in that area. Ycu had better do Travel King then. 'Ihat wouldn't be a bad name to use, you know. who us? Yeah. El-. As a branch office. As a branch office. Out in Pickering. Instead of waiting? Yeah. Yeah: 'Ihats an idea. 'Ihats an idea. For 340 bucks you're in hlsiness. Yeah. thats right. Yeah. OK ma boy. OK. Bit if you hear anything on the other. Yeah. Ycu know, cn the number like, you know what I mean? Yeah. I'll give you a shout. Please. OK boy. OK Vie. - 43 - At 8.54 p.m. the same day Mr. Snape called the griever at his home 'in Acton. The conversation (at pages 32-33::' Exhibit 6) went as follows: H. V. * v. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. Hello. Oh. Ekmjour monsieur. Bmjow. Listen I just had a gentleman from the Metro Fraud Squad here tonight. I wouldn't doubt it. Eh? I say, i wouldn't doubt it. Go ahead. Yeah. Anyway Maria is accusing you, myself and er Whitfield of, er, a plot or a scheme to er; take money, out of the fund. you're kidding. No. So I told him it was absolutely ridiculous. I had no jurisdiction over the fund, you know. Yes. He asked me how'lcng I'd known you; I said about 2 years, er. he asked, er, if I had ever met Whiting. I said "No". We . asked if I ever talkcdto him. I said "Yes . (Xlce ahxt the application." ?he only thing I can suggest that you know she's trying to say this to get herself out of a mess. Yes. what. 'Ihats a surprise job. ' Yes. So probably yourself and Whiting will get a visit also (laughs). Well. He was here last night, eh. Yes. But we just better keep our story together for Christ's sake. i%t I'll do that bloody woman because I really helped her. Yes ycu did. Kept her going for years. Yeah, but she actually said that? Yes. We's going to the office. He's going to the office tomorrow. Probably to see Caven. Wit in the morning I'm at, er, the Chelsea Inn for a little while. EUt then, you know, - 44 - H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. V. H. I'll be back and in the afternoon I'm there. I see. But I mean thats quite a serious allegation. Very s&ious. I think i:,ll:... I'll have to see my solicitor. Yes, sir ee. Mz too, now, as I know that. Yeah. As a matter of fact I spoke with her this afternoon. Ard she didn't say anything? i-bt a wx-d. 'Ihats a bit naughty isn't it? Yes indeed. Yeah. oh, you know. Tip off our friend at Pickering. Yes, indeed. Alright. Yes, indeed. OK. Zut-lets all stick together for Christ's sake. Yes, indeed. Yes. We don't know anything about it. Lets sit and her swim in her own. =r stew, you know. Right. Yeah. I mean I helped her a&all that. I'm glad I called you. .OK. Yes. OK. My by. Alright. Lcok after yourself. Sue will. You too. Bye bye. Apparently there were~no more calls to the grievor from Ms. 'Malinski. There was, however, a call from Mr. Ken King on Saturday, October 22, at 12.30 p.m., in which there was talk of a possible meeting with Ms. Malinski. The griever has sworn that such a meeting never occurred; he did not see her later. 19, land again until the four accused went to court a few days Ms. M‘alinski had been arrested and charged on October Messrs. Snape and Whiting a day or two later. The gr ievor was i , I - 45 - not charged until October 27. The first part of the conversation between Mr. King and the griever on October 22 (at whic<\,time Ms. Malinski and the others had already been charged) at pages 34-35 of Exhibit 6, was as follows: Km. Hello Vie. V. K. V. K. V. K. V. K. V. K. V. K. V. K. V. K. V. K. V. K. V. Yes. Hi Ken. Hew are you? Not too bad. How's yourself? Musn'tgrumble. . . . . . Well, do you want to see the lady tomorrow? I don't know what to do. Ken. I see. What do .you think? Well, I think that always the more knowledge that you have the better off you are. Yea, Sea the only thing I'm afraid of is if I get seen, you know, with her. You never know these days,'you know. Where wcxlld we meet? Oh. somewhere rm.rt between Acton and Toronto. ti: It doesn't matter to me, Vie. Well, its very nice of you, Ken. Have you spoken to her? Yes. See, because, you know, what does she feel about this? scared. Yes. Wel,l, you know, I am. Because I'm frightened you know, somebody's going to knock on the door any time, sort of thing. Because I can't see why having charged the other two why they don't , you know, come along here. I know. Unless they're waiting until Monday. bt you see I really, in my own mind, I feel that cne should talk to her before the ting (sic) cn Wednesday, hit they'll probably ask for it to be defered won't they? Oh 100 pr cent. Yeah, tiy aren't, I was gonna say, why don't we wait until after Wednesday and I would prefer an evening, I really think Ken, if possible. Say Monday evening. ‘ K. V. K. V. K. V. K. V. K. V. K. V. K. V. - 46 - Well lets see what happens, then. Yeah. Are you definitely meeting with her tomorrow. Today. Today. Oh you're going today? Right. ml. Well the only thing I was thinking is, we could say to her, look, um, you know, we got to this this point now, er, you know, unless its thrown out of court somehow, she's going to get a very difficult job to get back into travel again. Well, she knows that she never will, for say, except just as an employee somewhere. 4 Ministry, Eor the Yeah, well I mean even you know, ame to that on a few things, the only other thing that I did think, er, Ken, was,.you know, if she could have said "Well I was really bragging" or something like this, you know, and she did get the $9000 but it wasn't really for travel and they plt.it down for travel to make a claim, you know, that might be a treasonable excuse, sort of thing. You know. That, er, you~know, she got the money for scmethitq for travel for the future but it hadn't really been booked. Yeah. Well I don't know. You know, my own feeling is that what she got for what she did thats what counts. lhursday and up on the up now. zanfind Yes. wit I think the thing 'is, you know, ,whether you care to.... Lcok Ken. Why don't you see her first. Right. See what she feels about this and if, er, you know, she's interested in a meeting. I'd be prepared to say, say Monday evening. Eecause Colin always'wmes home on a Monday evening ard he can bring Bet home then. Alright. Lets see what happens then. OK. Thanks for calling. The second part of the conversation was about a lferent matter in which both'men were interested. Mr. King called Acton again at 6.56 p.m. on Thursday, :ober 27, pages 38-39 of Exhibit 6: 3h. it tomorrow. retry you was 3r so, Ken. I r matter :t day. I K. V. K. V. K. V. K. V. K. V. K. V. K. V. K.' V. K. V. K. V. K. V. K. V. K. V. K. V. K. V. K. - 47 - yes. Listen. Did you see the men today? Yes. (Laughs). Yeah. I've been charged the same as the others. > ~cu're kidding? No. (laughs). Ard yap know, I am suspended from the Ministry, sort of thing, until the whole thing is resolved. Whendid this happen? Er. Today. This morning. I'll lze damned. Yeah. So, er, I don't know whats going to happen for the future, tit er.... Wkn did you 90 in? Urn Yeah I, I personally cOme up next week or next Thursday and then I think we are all charge$together and come up on the 16th or the 19th. I can't remember when they come up now. Is that a fact? Yeah. What was; what is the charge? urn. Cmspiracy to defraud and also attempted fraud. My Gxl. I think someixdy must have turned King's evidence. But who could the somebdy lx?? Well, I don't know. But you know, we'll s&e if we car,find out tomorrow. (Laughs). 'Are you in tomorrow? EL-, well, I'm going to cOme into town tomorrow, yeah. I?ut are ycu in, er. bw do you mean you'll find out tomorrow. Er, well. I'm going to call tw2 people you know. Oh. I see. Yeah. Well 1'11 ?x go to hell.~ Yeah. 'Ihats tiat I thought. I thought in this cuuntry you was innocent until proved guilty. Eut it doesn't appear so, Ken. Is it going to hit the papers? It probably will do, yeah. &Gcd. Yeah. So I don't bow. Thats grim because.... The two men then went on to discuss another matter and agreed they might have lunch in the city the next day. At h i cross-examined - 48 - s trial in November, 1981, the grievor was in respect of the conversations quoted abdve '\ and related matters. All this appears. at page 62 to 133 of the transcript (some of which has already been quoted) and it in- cluded objections and discussion between counsel and the pre- siding judge. The answers given by Mr. Debenham in 1981 were consistent.with those he gave at the hearings held by this Board in 1983. It is of course impossible 'to reproduce in full such a lengthy cross-ex.amination, but it is considered that the following passages are significant. Referring a visit frbm Mr. Sm were as follows: to Ms. Malinski's call on October 14 (after ith) questions and answers at pages 104-105 9. A. Q. A. Q- A. Q. A. What were you going to visit her about on Monday or talk to her about on Monday or can't you remember? I think she probably just wanted to talk, but I think I'm being a bit evasive there trying to put off seeing her. why? Well, because of the investigation that was going on. You didn't have any problems discussing the investigation that was going JX-I with her in this conversation? Well, as I have already admitted to you earlier, I think possibly on that one area, I may have erred in asking her what went on. I pu,t it to you that you were interested,in knowing what was going on with the Fred Whiting claim and Mr. Smith because you were involved in it, Mr. Debenham, that's why you asked? No. That's a complete lie. ‘ - 49 - The next questions were about the griever's first call to Mr. Snape on October 19:. J Q. Now, now sir, you testified this morning that you were interested in finding out what had happened to Maria Malinski and v.hether~or not she was arrested, is that correct, at a particular time in &toter? A. I wasn't, no. Mr. Caven was. Q. Oh, Mr. Caven was? A. Yes. The Crown then acknowledged that the grievor had a valid reason for going "downstairs" to continue the conversation with Mr. Snape, and continued with questions about w,hat the grievor said (pages 107 et segl: Q. YO.I wanted to protect his identity. And Mr. Caven, quite fairly, Mr. Caven testified to that too. He's testified that he knew you were going downstairs, you wanted to protect Mr. Snaps's identity and you wanted to find out more. But let's look at tiat you were interested in, Mr. Debenham, when ycu talked to Mr. Snape. You say: "Listen. how tight is she. S-e, you know, will she shout?" Ax-d Mr. finape says: Wo, I don't think so." Ard ycx~ say: 'Ckay. I don't think they've got much on her." And Mr. Snape says: "No, they haven't. You see." And you say: "She accepted money' that she paid off other bills." At-d Mr. Snaps says: "That's right." Ad then you say: "Unless they've got something specific. Y0.l know. I'll try and find out later on." And Harry Snape says Wo, they haven't. 'Ihe way they talked to me." Sir, the thing that concerns me about this is that it appears that Harry Snape has been investigated, in this conversation ::\ A. Q. A. Q. A. Q. A. Q. A. Q. ;: A. - 50 - in relation to this Whiting claim, so why are you discussing this claim with Mr. Snape? I canIt see anything in there that says about a claim: It says : "fraudulent conversion", monies, nothing but a'q1ai.m L4latsoever. You're trying to put wxds there. But were you scared that -- all right. Let me ask you this. What were you afraid that Maria Malinski would shout out, hut? I think you're interpreting the word wrong because you'll find at the erd of this particular paragraph, at the end of this particular tape, I again say @ Mr. Snape: "1'11 give you a shout." Now, this is a bad form of Erglish, but I'm afraid that it really means, will she call, because I didn't want a drunk, a drunk mman 'phoning me. why? Well, you know, I was a Ministry official and you've got somebody on the 'phone rambling away that she's been charged and all this sort of thing, I didn't really know. So when ycu say that, &en you say: "How tight is she. You know. Will she shout?", what you're referring to is the fact that --- Well, how tight she is is how drunk she is. I agree it's - slang but that's the interpretation. Ard will she.shcut is will she call. Will she..... . . . . . Ard then you say'to Mr. Snape: "Well, tell her if she wants any of her records back how, she can demand them, because, you know. For her defence." "Because the lawyer asked me. I made up a statement for him, you know." Ard you say: "Yeah. I mean, she can demand them back...." I thought you were con- cerned 'CD find out whether -she was arrested. It appsrs that you're telling him to give her some advice to get herself out of this situation. First of all, we are talking aLout fraudulent conversion of funds. Sk wxld need her records to prove what money she had taken in and tiat money she'had paid out. This is nothing to do with the claim there. Even if it has nothing to do with the claim, wuldn't the investigation of Maria Malinski on fraudulent conversion be a anfidential Ministry matter? Well, we must go back to July --- Wouldn't it be a confidential Ministry matter, sir: Yes. , Q. A. Q A. Q. A. Q. A. Q. A. Q. A. Q. A. Q. A. Q. :: A. Q. - 51 - What are you doing tellirq Mr. Snape to tell Maria Malinski,.tc ask for her books back? She has a lawyer.) Well, Mr. Snape had lxen given, with all due respect, :\ the power of attorney of the company in July. And again at pages 112 et seq: NW, Staff Sergeant Wheeler visited you at eight o'clock on October 19th. 19771 Yes. An3 Mr. Eixke has admitted it on your behalf that Staff Sergeant Wheeler was the first officer to ever visit you with respect to this? 'Ihat is correct, yes. So up until this time at least, all you knew about, was that Maria Malinski had been arrested a-d from what Harry Snape said its appeared that she had been arrested for fraudulent conversion? Yes. Ard of muse you told us you weren't involved? That's correct. 'At-d you didn't know whether Mr. Snape was involved? I don.'t think I said that at all. Well, do you know whether -- prior to Weler coming there, do you know whether Mr. &ape was,involved? In the claim? Yes? I knew nothing about the claim apart from the fact that it had come into the office. FL1 right. Ycu thought that Mr. Whiting was involved because obviously you thought this was a false claim? Correct. Ard of course Mrs. t&linski had to be involved because she gave him the receipt? ?hat is correct. All right. So Staff Sergeant Wheeler comes in and Mr. Burke has pinted out that Staff Sergeant Wheeler for the first time confronts you with the allegations that have been raised against you and those allegations are Mrs. Maria Malinski says that you, Harry Snape and.Fred Whiting almg with herself agreed that Fred Whiting was to S&nit this receipt to the Ministry; this is what you told Sergeant Wheeler? - 52 - ;: A. Q. A. Q. A. Q. A. Q. A. Q. A. Q. A. Q. :: A. Q. A. Q. A. .Yes. Ad of course you're shocked? i Yes. I was very shocked. Ycu were upset, sir? I think so, yes. And you 'phoned Harry Snape and tell him about this? Well, no. Harry Snaps actually 'phoned me. I'm sorry.. Harry Snape 'phoned you? Yes. That*s'correct. So, and you tell Harry Snape about what's --- Oh, yes. I think you can see I was upset because I used words M that particular call that I.Qn't usually use, to be honest with you. And ycu indicate in that conversation, you tell WT. Snaps that probably he and Nr. Whiting will get a visit? Well, if she had accused the three of us, and the @ice had ccme to me, it's petty obvious that they would go to the other two. No doubt about that. No doubt about that. So you're telling him you're going to get a visit, Harry, and probabiy Fred Whiting is going to get one too. Yes. And it's understandable that Fred Whiting is going to get a visit because after all, i-e had submitted this claim that you knew to be false? lhat is correct. Ard Harry tells you then that Smith has already been there, in this conversation, correct? Yes. Cculd I --- I believe I did, yes. All right. So the next thing you say to him is: "But we just batter keep our stories together for Christ's sake. But I'll do that bloody woman because I really hslpea her." What story do you mean? Well, 'I think I've already admitted that I was upset that, and that I had been helping Mrs. Malinski and Mr. Snape with this agency, now, to get this along, and I think that as I previously testified, that when police get involved in anything, the slightest little disagreement in a story, there is always problems. So I think it's natural to say, well let's stick together, you know, it's a figure of speech. Who are you going to stick together with? I don't know. It's just something I said. It's an expression I said, let's stick together. L I ! ,.’ i - 53 - ,.. ,,. ,_ , , ‘:I I . :: y 8. ;: i A. Q. A. Q. A. Q. A. Q. A. Q. A. Q. Q. Q. A. Stick together in tiat, what story? Well, we had no part of this plan to defraud the Ministiy. Well, sir, you just told us you knew nothirq atout the i, plan. As far as you knew Mr. Sqape knew nothing about the plan. 9-e only px-son L&O might have known anything about the plan might,have been E'red Whiting. Why wxld.you have to stick together cn anything? Because you have just told me that Sergeant Wheeler told me alxut this. Well, that's true, sir. hit if Sergeant wheeler tells you about something and -- why wxld you stick together with somebody? Why? How can you stick together, you all don't know anything abxt it? Isn'tthattbs answer, just say I know notI+g atout this? That's the reasons why we have got to stick together because we didn't know anything about it. All right, sir. YUI told US that Mr. Frederick Whiting was not your fried? Correct. You've also told us, and again I~go over this area, you also told us that you suqected Frederick Whitillg of fraud? I'm sorry? 'You also told us that you suspected Frederick Whiting of attempting to defraud the md? Yes. so bhat do you say to Mr : snape, yo" say: "oh, you know. Tip off our friend at Pickering." Ard you remember this morning yap had told Mr. Wnke that.your friend at Pickering was Mr. Whiting? Well, I think if someb.~ly was going to invest in a company and this sort of thing had happened, you're obviously going to tip off a person, &IO was investing money into a company, what had happened. I pit it to you you're talking &ut that when; you're talking abxt tipping of (sic) Whiting with respect to the allegations of Maria Malinski? Well, yes. Both. Well, you just told us you thought Whiting was involved; &y wxld you stick together with CUlitirQ? If anything, you'd to get as far away from whiting as you could. Well, no. Not at that stage because~ let's face~it, as I said to you before, it was only my opinion that the claim was false. I knew it was under investigation. It wasn't Q. aA: A. Q. A. Q. A. Q. A. Q. - 54 - until Sergeant Wheeler came, when he said they they were making inquiries into it, so therefore, you know, a per&on is innocent as you admitted earlier until such time tha: has been proved that it was a false claim. Well sir, the problem I have, and maybe you can express -- I don't understand tiy you wxld want to get together with Fred Whitirg. I might see why you would want to get together with Fred tiiting, Fred Whitingis the man you think is involved. ~. I hadn't got together with Fred Whiting. Well, you say: "Tip off our friend at Pickering." Well, he was a,friend of Mr. Snape's. Y~I say: I'..... cq friend", sir? Well, okay, again, you know, when you look back here, a friend, I'm, I mn't say yourfrielaj or whatever the case may be, I simply just said: "Tip off OUT friend in Pickering.", it's an easy manner. All right. Let's foll~~+~ through then on that, and Harry says : "Yes, indeed." AK? you say: "All right." Harry says: "Yes, indeed." Ard then you say: "But let's ~. all stick together for Christ's sake." And Harry says: "Yes, indeed." "We don't know anything about it. Let's sit and her swim in her own stew, you know." I &ut it to you that you mean all three of us stick together, Harry, Fred, and yourself? Well, I think if three of you have been accused of some- thing, which you hadn't done, obviously you're going to stick together. I'd rather stick together with SOmeone who I didn't suspect myself, horn I hadn't told somebxly else was involved. YOU already told other people that you thought this was a false claim; why muld ycu want to stick together with --- I had been advised by Sergeant Wheeler that Mrs. Malinski had accused me and had made a statement; but she hadn't made a statement at that stage. Sh2 hadn't made a statement. I agree with yo! that she hadn't made a statement at that stage. But after Staff Sergeant Wheeler had left, sir -- so I mean on Mr. Wlrke's theory, this big conspiracy to get you~hadn't come to fruition yet -- after Staff Sergeant Wheeler left, you thought that she had made a statement at~I you felt betrayed by her and you indicate that very clearly because you say, I'll get that bloody woman, after all I've done for her, I've kept t-er going for years. c - 55 - A. Q. A. Q. i: ;: A. Q. A. Q. A. I had helped her and I felt I had been let down, yes. j Ycu felt betrayed? Well, I think you're using a word I wxldn't use. I v&ld say I was let down. Betrayed meant something different to me. Well, you say: ".... I'll Q that bloody vaman because I helped her." harry said: "Yes, you did." "Kept her going for years." And then you refer again, at the end of the conversation: "Yeah. I maan I helped her and all that." Sir, okay, you felt let down? Yes. Y~I, you having felt like this, the last person in the world ycu mid ever want to meet again is Maria Malinski; isn’t that true? At that stage, yes. At that stage, yes? All right. So that's the 19th of Cctober, 1977, and at this stage, if I understand you correctly, you’re aware of the allegations and you say to snape : Tip our friend off at Pickering." Ihat's Mr. Whiting. Ard you want all three of you to stick together because you've got to stick together because she's made these allegations. It doesn't make any difference that you think Whiting is involved, you're prepared to stick together 'with Whiting, you say. New, and you say you don't want to meet with Mrs. Malinski. N3f. you were arrested, sir, on October the 27th, right? That is correct. Prior to your arrest, all that would have really happened to you wxld have been that you were informed of the alle- gations and you were kind of waiting to see what happened,. waiting for the, the doom to fall or whatever; is that true? Yes. I suppose you could put it like that, yes. Why did you ask Ken King to set up a meeting with Maria Malinski on the 22nd? I didn't. . . . . . . I Q. Ard you say, you're hesitant at first but you finally agree I to it. Why wxld you agree to it? A. Because I really wanted to find out why she wxld accuse me and yet, on the other hand, I felt that I shouldn't see her. Q. A. Q. ;: A. Q. A. Q. A. - 56 '- True. ix-d you say that and then yc~ decide that maybe you will see her and you're worried though, you're wxried<though that somebody may see you seeing her; isn't that corre&? oh, yes, definitely. So you say, to Ken King, you leave it to him to arrange it and Ken King suggests that in order to avoid your fears of being seen, you'd arrange to meet her somewhere between Acton and Toronto, right? Yau want to'make sure nobody SAW you with --- 1 didn't suggest that. No, Ken King says somewhere between Acton and Toronto. k3. And you've just expressed a concern that if you do meet her, ycxl don't want to be seen with her. Well, I wanted a third party with me if I was going to meet her,yes.. All right. And ycu were going to threaten her, weren't you. Mr. Debenham? I don't think so. At page 125 the Crown again touched on the meeting which according to Mr. King, was sought by Ms~Malinski: ‘Q. A. E: Q. A. Q. A. Why would you want to meet with her? why would you suggest that she tell another lie? Well, I think I was a bit reluctant lxt I really wanted to knowwhy she wanted tosee me. She didn't want to see you. Well, she did because she made.a recpest through WJT. King for me to meet her. Did you meet her? No. why? I didn't think it was appropriate. With further reference to Mr. King's call, the -5J- .;.: following was said, page, 126: i Q. Ard you indicate at Page 38 that you think someLody must have turned King's Evidence. wh3 did yau think.that somebody was? A. Well, I think somebody must have gone to the Ministry and said this claim is false. Q. Well, you said it yourself. Pbkdy had to go to the Ministry to tell them that; that was no news for them? A. Well forher to be charged there must have been more specific information, you know, other than somebzdy just feeling that the claim was false. They wxld have to have'far more information. At page 133 of the transcript, the cross-examination concluded with the following words: Q. Mr. tkbenham, after listening to all your +stimony, I pit it to you that you're lying ax-d that yoqwere a party to an agreement and that you agreed with Maria Malinski; did you or did you not?~ A; I did not. Q,. Ard I put it 'CD you that when you thought that Maria Malinski had given a statement to the police, you were prepared to threaten her? A. I haven't threatened her at all. Of course much of Crown counsel's cross-examination of the grievor was part of an attempt to establish ,that he was a member of the conspiracy responsible for,the Whiting claim of $9,000 against the Compensation Fund. That issue was disposed . - 58 - of when the jury acquitted Mr. Debenham; and that issue does not arise in the arbitration. The question. to be decide! here is whether, as the employer alleges, the griever's words and deeds in connection with the Whiting claim were incompatible with his duties and obligations as a public servant. In that light, the tr~anscripts of his telephone conversation and the answers he gave in cross-examination as well as his testimony before this Board are highly significant. Conclusions which may properly be drawn will be stated later in this decision. We turn now to the allegation made against the grievor in connection with what is termed "the Sandner affair." This can be explained more quickly than the Malinski-Whiting affair. Significantly, Ms. Sandner's complaint was mentioned, but not emphasized,. in the very thorough argument made to the Board by the employer's counsel, Mr. Brown. It is clear from the evidence of Ms. Sandner herself th~at in June and July of 1976 she lent Ms. Malinski $4,000, which (according to Exhibit 30) was to be repaid by September 1. Payment was stopped on a cheque to Ms. Sandner, dated July 24, Exhibit 22. Payments on account were made and on January 25, - 59 - 1977, Ms. Malinski certified in writing that "I owe Miss A. Sandner the sum of $1,300.00 as'a personal loan. The bents for this loan is a free return ticket to Acapulco, Mexico," Exhibit 19. In June, 1977, there was still $1,085.00 owing to Ms. Sandner. Since payment then seemed unlikely, she called the Travel Branch and asked for Mr. Debenham, of whom she had heard. The call has been loosely termed a "claim," both at trial and at the hearing conducted by this Board. In fact it was not a "claim;" it was a telephoned complaint. The distinction is made clear by Section 15(4) of O.Reg.471/76: A claim for payment out of the fund may only be made by a claimant giving written notice of claim to the Registrar for transmittal to the Board with full particulars thereof..... Since the griever had considerable experience with complaints aboutMs. Malinski, he told Miss Sandner he would look into the matter and she should call again.in a couple of days. He duly made inquiries and then advised the complainant that her money had been part of a loan,.and further that Mr. snape, then in charge of Ms. Malinski's office, had a certified - 60 - cheque for her in the amount of $1,085. In Exhibit 18, Miss Sandner duly acknowledged receiving from Mr. Snape the ne?essary .~.. : .* -::, s.. .: .: .:. .::. cheque,~ a copy of which is Exhibit 21. ,... In other words the loan was repaid in full, largely due to the intervention of the griever. In cross-examination, Miss Sandner said she also received.a'trip to Cuba' as a bonus. The griever's ~explanation for his intervention simply is that as usual he was trying to keep a travel agent out of trouble. It was natural that he dealt with Mr. Snape since, - according to the complainant, Ms. Malinski was "drunk every day." The employer alleges that the grievor ought to have opened a file and reported the affair to Mr. Cave", and that his'relations with Mr. Snape were unduly close. Our view, however, is that the griever's behaviour in connection with Miss Sandner's complaint was not improper. He had a well- I established pattern (as Mr. Cave" knew) of talking to Mr. Snape as an "informant"; having satisfied himself that the money had been a loan, he notified the complainant that. Mr. Snape could - 61 - give her a,certified cheque, and'in his m ind that closed the matter. Not unreasonably, he thought it within the scop@of his duties to keep the Malinski agency "out of trouble" -I- so far as that was possible. If a claim had actually been filed, his duty would have been to give tiis information to Mr. Cave" or the investigators, but of course there never was a claim by Miss Sandner. As for her, she may have had the mis- taken impression that-the Compensation Fund could help a creditor like herself. The Fund of course was designed to protect members of the travelling public, not all creditors of an insolvent agency. It has also been alleged against the grievor that he improperly,disclosed confidential information to one Janet Rogers in respect of a travel agency known as "Hurontario." In the regular course of his duties Mr. Debenham had learned that Hurontario was in difficulties and that the Italian owner would be interested in asale. The only evidence about the conversation is that of the griever; neither the owner nor Ms. Rogers was a witness before this Board. According to the grievor the 'owner said he had to find a buyer. The result was that when Ms. Rogers told the griever she tias looking for a business in the - 62 - Mississauga area, he mentioned "Hurontario." Earlier in this decision we quoted Section 21 df The Travel Industry Act, which requires a public servant like Mr. Debenham to "preserve secrecy i.n respect of all matters that come to his knowledge....." There are, however, three exceptions li specified in Section 21: the third is that such matte.rs may be communicated "with the consent of the person to whom the information relates." Subject to registration with the Travel Branch, it. would not have been improper for Ms. Rogers to take over the 'business mentioned. In our opinion, it would be far-fetched to conclude that the griever was disclosing confidential information'to Ms. Rogers when the owner of Hurontario had talked of selling and Ms. Rogers spoke of buying in that area. The griever's version stands uncontradicted. In our opinion, there was no breach of confidentiality and the employer's view of the "Rogers affair" is not well founded. In short, we have concluded that the employer's allegations in respect of the Sandner affair and the Rogers affair have not been proved and must be rejected. - - 63 - , It is now necessary to return to our consideration of the evidence relating to the Malinski affair. The docum!ntary evidence has already been quoted. Reference must also be made to the testimony of Ms. Malinski before this Bbard. The witness was examined and cross-examined at length. For many reasons we do not think that all her statements can be believed. The principal reason is that during the past six years she has given so many different versions of events in 1977. In her hotel room meeting with Staff Sergeant Cowperthwaite and Mr. Schade on.'September 21, 1977, she repeatedly said she didn't know whether Mr. Debenham was involved in the Whiting claim, but on October 24, 1978 (the ,night before her preliminary~ hearing) she signed a statement, Exhibit 26, in which she expressly said that it was Mr. Debenham who first suggested the Whiting claim and that he assured those present there would be "no problem" getting away with it. Nevertheless, in giving her sworn testimony before this .Board she,said she could not recall who suggested the scheme. She explained twice that "I _I don't recall what Debenham said." Ms. Malinski also testified: "I was in a very bad state --- I'd agree to anything at that time." The time was - 64 - July, 1977, when she became insolvent. As for Exhibit 26, she has testified before this Board that her lawyer warn:d she might be facing five yearns in jail and on his advice-she decided to plead guilty and give the Crown a statement, as to which she said: "I guess I wanted tom tell them what they wanted,." It is obvious that the jury at the criminal trial did not believe her version of the scheme's origin. Nor do we. There are other inconsistencies and .contradictions in Ms. Malinski's evidence which need not 'be specified. The employer's.counsel called Ms. Malinski as a witness, but it is clear the case against the grievor does not rest on her testimony but on the transcripts of several telephone calls. The transcripts have not been quoted in full. It isbelieved; however, that the extracts quoted are sufficient to indicate (1) the foundation for the employer's view that the griever's words were unworthy of a public servant in his position; (2) the contrary view that if such conversations are understood in their proper context they become evidence of innocence, not guilt. - 65 - Earlier in this decision reference was made to Exhibit 3, the opinion given the Min~istry on October 14;>1982, I which formed the basis for rejection of Mr. Debenham's grievance. After reviewing the information before him, Mr. Sadinski con- cluded "that the dismissal was justified even in light of his acquittal by a jury." He referred to "Debenham's conduct in the Malinski matter," describing it as a "most serious" breach of trust because "as an Inspector, Debenham could,not share such confidences with registrants and those whose conduct and affairs he or'his Branch must investigate." The weakness in t~hat approach is that the term "such confidences" has never been clearly explained. No one has identified clearly the "confidential" information alleged to have been improperly disclosed. Certainly, most of the rather evasive answers the griever gave Ms. Malinski and Mr. Snape cannot be described as breaches of,confidentiality. More important is the fact that, as .Mr. Sadinski found, there were times when the griever failed to keep Ms. Malinski and Mr. Snape at "arm's length." His conversations with them amount to a series of foolish indiscretions rather than the offence of breaching confidentiality. He .?eems to have had undue respect for their integrity. We think there is an explanation for sharply different interpretations of what was said during the griever's cd.nver- '\ sations with Mr. Snape and other persons. If, on the one hand, it be assumed that the griever was a co-conspirator with Mr. Whiting, then some of his remarks take on a sinister significance, particularly his remarks to Mr. Snape on October 19 that "we juit better keep our story together for Christ's sake." On the other hand, if it be concluded (as apparently a jury did) that the griever had no part in the Whiting con- spiracy;then his indiscretions have a relatively innocent significance, even though they were foolish indiscretions. In his cross-examination at trial he admitted he “may have erred" in asking Ms. Malinski on October 14, 1977,, what was "going on" with Mr. Smith's investigation. It must be said, however, that the grievor'~s curiosity was natural in view of the fact that he was the Inspector who had repeatedly dealt with complaints about Ms. Malinski's business and had been partly responsible for the surrender of her licence. His curiosity had its limits; there is no evidence - 67 - that he made contact with Mr. Whiting, whose claim he regarded as absurd. It was not within his jurisdiction to invesi?igate or pass judgment on that claim. As he explained in cross- examination, he donsidered it an invalid claim but it was not for him to say so prematurely. Most of his remarks to Ms. Malinski and many of those he made to Mr. snape related to her efforts to re-enter the travel business as an employee of some registered agency. Having tried to'"keep her out of trouble" when her own business was registered, it seemed natural to speak sympathetically of her efforts to find work in the travel industry. As for relations with Mr. Snape, they were undoubtedly affected by the latter's history as an "informer" on "informant." When irregularities were rife in the travel industry, it is not surprising that both Mr. Caven and the griever found it useful to take advantage of such a talkative source. Significantly, Mr. Debenham's first call to Mr. Snape on October 19 resulted from .Xr. Caven's request to inquire about the rumour that Ms. Malinski had been arrested. Both Mr. Caven and the griever, being responsible for the adminis,tration of the Travel Industry Act, had good reason to be curious about the arrest of one whose business had held registration until July of.the same year. - 68 - The conversations with Mr. Snape took an entirely different turn at 8.54 p.m. on October 19. The griever $ad just been informed by Sergeant Wheeler of Ms. Malinski's accu--\ sation. It is clear that he was surprised and shocked. Naturally, he would hope that neither Mr. Snape nor any other person would support such an accusation. Unless he was himself a party to the attempted fraud, he would have no reason to believe that Mr. Snape was among the'guilty. Thus he spoke very freely, as when he said the only thing he could suggest was that "she's trying to say this to get herself out of a mess," a suggestion not far from the truth. Obviously, the griever - regarded Mr. Snape as an ally who might help to defend against the Malinski accusation. In that light, his remark about keeping "our story together" becomes comprehensible. His advice to "tip off our friend at Pickering" --- meaning Mr. Whiting --- is less comprehensible, unless he actually said or meant '!'your friend." He knew of course that a pending application for registration was a Snape-Whiting project. There is little or no evidence that he himself was friendly with Mr. Whiting,but he was aware of the Snape-Whiting association. At the same time he had no zolid evidence that the Whiting $9,000 claim was fraudulent. What,ever the explanation, the reference to "our friend in Pickering" was rash and improper. He had already said "Probably yourself and Whiting will get a visit also." - 69 - .; Upset by bad news on the night of October 19, the griever spoke of consulting a solicitor, which was legit$mate, '\ but some of his other statements showed lack of judgment. It is noteworthy, however, that it was not he who called Mr. Snape after the police visit that night --- Mr. Snapecalled him. Similarly, the meeting proposed by Ms. Malinski was her idea, not his. In his talk with Mr. King, the griever wavered between prudence and curiosity about what she had to say. In the result, however, there is no evidence that such a meting took place. When cross-examined,at trial and again when cross- examined before this Board, the griever--- unlike Ms. Malinski --- gave a good account of himself. He did not pretend to have spoken wisely at all times, but did his best to explain past efforts to keep Ms. Malinski out of trouble and also the special relationship which gave his talks with Mr. Snape a tone of familiarity or even intimacy. He seems to have been more help- ful to them than they WE? to him. According to the griever, the Minister's mandate to the Travel Branch had been to encourage good business practices in a "fragile" industry (and "keep it out of the papers") and to avoid playing the role of bureaucratic - 70~- tyrants. Acting under that mandate, the griever sought to be helpful, perhaps too helpful, to those who stumbled alonG\the way, like Ms. Malinski and heraide, Mr. Snape. Having regard to.the evidence as a whole, we have concluded on balance that the griever was guilty, not of doing wrong, but of indiscretions inappropriate for any public servant in a regulatory,position such as his. We have no doubt that for, such public servants careless indiscretion and bad judgment constitute misconduct. We find that there was misconduct on several occasions in October, 1977. We do not find misconducf prior to that month. The question thus arises whether dismissal was an appropriate or excessive penalty for such misconduct, having regard to all the circumstances. Mr. Caven, Registrar at the Travel Branch, testified on February 10 that he hired the griever in 1975 because of his experience in fhe industry and because he had travelled widely. When Mr. Caven fell ill, the griever acted in his place. For some time the griever processed claims against the fund, - 71 - but in 1977 that work was assumed on contract by a Mr. Buckley. Mr . Caven recalled Some conversation in the office about the ‘\ Whiting claim. To him it seemed "odd." He saw the transcripts of telephone conversations after ~the griever was ch~arged. In his opinion some of the remarks made to Ms. Malinski, Mr. Snape and Mr.. King were breaches of confidentiality. The decision to suspend on October 27, 1977, and the decision to dismiss on December 18, 1981, were not taken by hiin but by his superiors in the Ministry --- the Executive Director of the Business Practices Division, Mr. Robert Simpson, and of course the Deputy Minister. ,On November 22, 1977, Deputy Minister R.J. Butler wrote the griever, Exhibit 34, that "a complete investigation into the matter should not be made until the charges against you have been disposed of." Replying to an inquiry on May 17, 1979, Exhibit 31, the Deputy Minister's Executive Assistant told the griever that "we are not prepared to reconsider removal of suspension, nor proceed with a complete investigation until the criminal charges are disposed of." These letters seemed to suggest that the Ministry's ultimate decision would depend on the result of the criminal trial. Nevertheless, dismissal followed very quickly af'ter the griever's acquittal. ‘ - 12 - Mr. Butler's suspension letter of November 22, 1971, is not in evidence but is referred to in Mr. C,rosbie's d:,s-~ missal letter of December 18, 1981, Exhibit 4, already quoted. Mr. Crosbie pointed out Mr. Butler had advised the griever (more than four years earlier) that "you were to be suspended pending an investigation into the then, allegation that you had been a p~arty to fraudulent activities regarding the com- pensation fund....." Clearly the real reason for the sus- pension was that.the police and the employer believed or at least suspected the griever had conspired with others to L commit fraud. The stated reasons for dismissal, however --- - four years later --- were quite,different. They were that the griever's' "actions" indicated a contravention of Section 21 of the Travel Industry Act, also the oath of secrecy in Section 10(l) of the Public Service Act, and finally that his actions had "compromised" continued employment with the Ministry. In our opinion the first two reasons given have little substance. The serious issue in this case is whether the words used by the griever in a series of telephone con- versations did in fact "compromise" further employment with the Ministry. - 73 -' The second reason cited in the dismissal letter is 2 lacking in weight. The Oath of Secrecy must be given a :\. reasonable interpretation. In MacAlpine 241/82 this Board L discussed the meaning of the Oath of Secrecy set out in Section 10(l) in The Publics Service Act. The facts were very different from those in this case but it was observed, inter alia: "We do not think the Oath can be int,erpreted literally one day and strictly the next day, varying with whatever seems discreet or prudent at the moment." That case was taken by the Attorney-General to the Divisional Court, which unanimously dismissed the application on September 27, 1983, and said in a judgment released on October 12: 'D-e submissian of the applicant is that the Board erred in its interpretation of Section 10 of The Public Service Act, R.S.O. 1980, Ch.418. A review of the Board's decision does not disclose to us that tk Board misccnstrud that section. We find that it iddressed the question of cause for dismissa; in detail and we find no reascn to interfere with its findings, either as to cause or its conclusions thereon ard its conclusion as to the penalty. The first reason cited in the dismissal letter was that the griever had contravened Section 21 of the Travel Industry Act. As pointed out previously in this decision, - 74 - the employer's case,has not shown precisely what "confidences" were shared with registrants and others. There were ce$.tainly '1 indiscrete and improper remarks made by the griever, but whether they disclosed confidential information is doubtful. The remaining issue --- and the important issue --- to be resolved is whether the griever's indiscretions, care- \ less and improper as some of them were, constitute valid grounds for disqualifying him from.performing the duties of a public servant in a regulatory position. We fully recogniie the gravity of this issue. .It could be argued that the employer's change of front between November, 1977, and December, 1981, was contrary to the doctrine enunciated by Professor Bora Laskin, as he then was, in Aerocide Dispense&Ltd. (1965) 15 L.A.C. 416, when he said at pages 426-427: The board is justified in a case of challenged discharge to hold the employer fairly strictly to the grounds upon which it has chosen to act against an employee who consequently feels himself aggrieved..... it ought not to permit an assign&cause to be reformad into one different from it merely because the evidence does not support the assigned cause but rather one something like it..... If another cause of disapline emerges from the evidence other than the one stated at the time, it is not an automatic con- clusion that the employer muld have treated it the same way merely because it finds it necessary to say so because of the turnof the evidence at the arbitration. - 75 - In this case, however, the only grievance before us > is the grievance against discharge --- not a grievance:,againbt the suspension. Thus we are concerned with the grounds stated at the time of the dismissal, not those given four years earlier, although we consider the later to have been coloured by the earlier. We are therefore bound to decide the real issue which has;emerged fromtheevidence: whether, as alleged in the dismissal letter, the griever's misconduct in 1977 has compromised "continued employment" with the Ministry. The Board finds that on a number of occasions in October, 1977, when speaking to Ms. Melinski, Mr. Snape and Mr. King, the griever uttered words inconsistent with the duties and responsibilities of his position as an inspector under The Travel industry Act. The Board further finds that the most serious of these indiscretions amounted tomisconduct sufficient to justify severe discipline. In particular, reference is made to the-following: (1) There was a highly improper statement'made to Mr. Snape on October 17, already quoted. The conversation related to the pending application by Messrs. Whiting and Snape for registration of "Happy Face Tours," in which it * - 76 - seemed necessary to establish the financial worth of the 2 applicants, or at least of Mr. Whiting. The application;was before the Registrar, Mr. Cave". Referring to him, Mr. Snape said: "You see, what I'11 do is, -just ask him if it's pro- gressing. YOU know." The griever replied: <aYei. No I can't see how he can turn him down because he's got everything," to which Mr. Snape responded: "Yes, he has." The griever then said: "He might say 'Well I want $10,000 in to open the thing.' But. you can always put that in one day and out the next." In effect, the griever was suggesting how Mr. Whiting might circumvent the Travel Branch requirements for establishing the financial responsibility of a new agency. Perhaps such subterfuges are commonplace in the travel industry, but it is inexcusable for an inspector to make such a suggestion. In our view, it is the most outrageous of the griever's indiscretions. Further, as Mr. Caven pointed out, the griever ought to have reported to the Registrar that the Whiting who had applied for registration was the same Whiting who had filed a questionable claim against the compensation fund in - 77.- : .. I .~ .‘I.’ I 5 ./ _. ‘. ‘. ‘.: I,, i July. He could have said that, not being an investigator, > he did not know for certain that the Whiting claim was :, spurious, but he could also have reminded the Registrar that the claim was generally regarded in the office as "absurd" or "odd . " (2) Less serious was the natural curiosity exhibited by the griever when informed ,by Ms. Malinski on October 14 that she was being investigated by Mr. Smith, a conversation reproduced at page 36 above. As previously mentioned, Mr. Debenham had often dealt with complaints about Ms. Malinski, had warned her in April of the impending loss of her licence and indeed had taken steps which led to the surrender of that licence in June. It would therefore be natural for him to wonder w~hichofher many mistakes had led to the Smith investigation. (3) More serious was a remark to Mr. Snape on the night of October 19 (reproduced-at page 44 above) when the griever had just learned,of Ms. Malinski's accusations and was no doubt much distressed. -He advised Mr:Snape to "tip off our friend at Pickering" --- obviously a reference to Mr. Whiting. The tape is not an infallible source, but it does - 78 - not really matter whether he said "our friend" or "your friend." The remark betrayed undue sympathy with the Snape-Whitin-g partnership; alternatively, it may have been inspired by the hope that Mr. Whiting would not support the Malinski allegations; Whatever the reason, the remark was improper. (4) It was also highly indiscrete and indeed improper on the part of the griever to make the remark he did Tao Mr. King on October. 22, quoted at page 46 above. The griever and three others had already been charged, and Mr. King --- not the griever --- had heard from Ms. Malinski. Perhaps thinkihg out loud, the griever said, among other rather incoherent remarks: '"If she could have said 'Well I was really bragging' or something like this, you know, and she did get the $9,000 but it wasn't really for travel and they put it down for travel to make a claim, you know, that might be a reasonable, sort of thing. You know. That,,er, .you know, she got the money for something for travel for the future but it hadn'? really been booked." These musings, confused and foolish in the extreme;amounted to making suggestions that Ms. Malinski should fabricate excuses for her false statements. As such they were highly improper, doubtless due to the despair and humiliation of the griever after he was charged and suspended. - 79 - The statements specified above form the basis for our view that the griever, in October, 1977, was guiltyjof :\ misconduct such as would justify very severe discipline. It must be added that, apart from the Board's findings in this case, the griever has been very heavily penalized. He was suspended without pay in October, 1977, and has been suspended ever since. He was charged with a serious criminaloffence in October, 1977,. committed for trial' more than a year later, December, 1978, and not brought to trial and acquitted until November, 19.81. Whatever the reasons, that inordinate delay does not reflect favourably on the admin- istration'of justice. The grievance was processed in 1982 but did not reach arbitration until February, 1983; hearings were not concluded until June 2. The mountain of evidence (which included 38 exhibits totalling more than1.100 pages) led to / prolonged consideration by this Board, which found no little difficulty in separating the, wheat from the chaff. If this decision seems lengthy, as indeed it is, we have a reason. This Board fully appreciates the gravity of thematterfor both the employer and the griever. Moreover, it is in the public interest that such legislation as the - 80 - Travel Industry Act should be administered fairly and properly; those charged with its enforcement have a serious resp&\sibility. Indiscretions not compatible with that responsibility cannot go unpunished. At the same time the administration of discipline must also be fair and it should beproportionate to the gravity of the offence. If the griever had in fact been 'a co-conspirator with Mr. Whiting and Ms. Malinski, we would not hesitate to up- hold his dismissal. That charge failed, and the employer's counsel does not now rely on it. The ,misconduct proved is much less grave than the charge on which the suspension of, 1977 was based. The grounds for dismissal were stated differ- ently in 1981: they were that the griever had violated ,his Oath of Secrecy under the Public Service Act and the rule of confi- dentiality under the Travel Industry Act. As well his actions were said to have "compromised" continued employment with the Ministry. It appears to us that the employer's decision to sus- pend and then dismiss were really based on the indiscretions revealed by the transcripts in conjunction with the accusation made by Ms. Malinski. When that accusation fell with the - 81 - collapse of her' credibility, the indiscretions assumed a different significance which we do not think has been <aken '\ into account by the employer. We agree with the employer that the griever's indiscretions were sufficiently serious to justify a suspension. We cannot agree however, that they were so heinous as to justify the conclus,ion'that his employment with the Ministry had been forever compromised. We therefore hold that the penalty of dismissal was excessive and that another penalty should be substituted, one considered to be just and reasonable in all the circumstances. The Board's conclusion reinstated, subject to certain reaching that conclusion we are L I is that the griever should be mportant qualifications. In mindful of the opinion expressed by the Registrar, Mr. Caven, who was for more than two years the griever's immediate superior and probably in the best position to assess his performance and his character. In his testimony on February 10 Mr. Caven said he spoken highly of the griever at the trial in November, 198 but at that time "I hadn't read any of these transcripts." had 1, .c - 82 - Having since read them, he testified'to this Board: "Now I think he has erred seriously, but I think he's hones; _ II t In light of all the evidence the Board shares that view of the griever. Although reinstatement is in 'order, we do not think this is a case in which retroactive compensation would be appropriate. We realize that such a result is the equivalent of a six-year suspension. Nevertheless, our view is that the indiscretions and improper statements specified above were sufficiently serious as to justify the Ministry's refusal to reinstate over a long period of time. The public should not be obliged to pay a price for the unfortunately protracted results of the griever's negligence and indiscretions. Notwithstanding the'mistakes he made in 1977,,the grievor is, in our opinion, capable of giving useful service d in future. He is not without ability and his long experience in aviation and the. travel industry proved to be helpful to the Registrar and the Ministry in the period between 1975 and 1977. The Board's decision therefore is that the grievor ‘ - 83 - i sha 11 be reinstated in his. former position as a Clerk 7 or in some other position of equivalent rank in the Mlistry of Consumer and Commercial Relations, but without retroactive compensation or the restoration of other benefits in respect of the period since October, 1977. The reinstatement shall become effective not later than January 1, 1984. The griever shall notify the Ministry in writing not later than December 1, 1983., whether he wishes to avail himself of reinstatement and the earliest date. on which he .could report for work, and the Ministry shall reply not later than December 15. If any difficulty arises in understanding or imple- menting this decision, we are remaining seized of the case and may be spoken to after due notice to the Regi~strar by either party. In closing, we have to acknowledge the careful work of Messrs. Brown, ~uczay and Burke in their efforts to clarify the evidence and the issues in respect of Mr. Debenham's grievance. Dated at Toronto this 3rd day of November 1983. EBJ:sol