Thank you, Mr. Clerk. Item 8, returns to written questions. Item 9, replies to the opening address. Item 10, petitions. Item 11, reports of standing and special committees. The honourable Member for Yellowknife South, Mr. Bell.

Thank you, Mr. Speaker. I present you with the report of the Special Committee on Conflict Process.

On May 7, 2001, the honourable Member for Hay River South, Jane Groenewegen (the "Minister") brought forward an application to the Board of Management (the "Board") requesting the Board direct the Conflict of Interest Commissioner (the "Commissioner") to suspend her investigation into a complaint made by Jack Rowe against the Minister (the "complaint"); and further that the Board recommend to the Commissioner of the Northwest Territories under section 92(3) and 92(1)(a) of the Legislative Assembly and Executive Council Act (the "Act") that the Conflict of Interest Commissioner be temporarily suspended and an acting Conflict of Interest Commissioner be appointed. The application alleged that there was a reasonable apprehension of bias on the part of the Commissioner respecting the investigation and that this gave rise to her inability to act due to "cause or incapacity" or that she was unable to act as a result of this.

The Board wished to hear from all parties on the issue and requested submissions on initially, the question of jurisdiction of the Board and secondly, if jurisdiction was found, on the facts and substantive issues in the application.

During the course of this, the Legislative Assembly reconvened on June 5, 2001 and the matter became an issue for the Legislative Assembly to deal with because the power of the Board exists only when the Legislative Assembly is not sitting.

As a result of this, and because the Conflict of Interest Commissioner intended to release her investigation report, she sought the direction of the Assembly as to whether or not she should hold it past June 13, 2001. The Legislative Assembly passed a motion establishing the Special Committee on Conflict Process to deal with the matter.

The Special Committee on Conflict Process was given direction by the Legislative Assembly by Motion 4-14(4), dated June 12, 2001. The terms of reference set out the membership of the special committee. In addition to the incidents of parliamentary privilege, the special committee had the following specific authorities and mandate:

• • To consider all aspects of the application made by the Minister to the Board of Management on May 7, 2001;
• • In considering all aspects of the application, to have access to such persons, papers and records that it considered necessary;
• • To conduct hearings and meetings as it considered necessary;
• • The special committee was required to provide its report upon conclusion of consideration of the application to the Speaker and to report to the Legislative Assembly with its findings and recommendations no later than July 23, 2001.

The Legislative Assembly also directed the Conflict of Interest Commissioner to suspend any further action including but not limited to the submission of the report in the matter of the complaint filed against the Member for Hay River South, the Honourable Jane Groenewegen. The Legislative Assembly also directed that the report on the complaint be held until the special committee reports to the Legislative Assembly and the Legislative Assembly has considered the report.

The special committee does not have the authority to finally determine the issues, only to recommend courses of action based on its consideration of the facts and issues. The Legislative Assembly must ultimately resolve the matter.

The matter would be available for debate in that forum in accordance with the procedures of the House in considering reports of standing and special committees.

Throughout the process, the special committee was vigilant to ensure that whatever approaches were taken or instructions given that all parties were afforded a fair opportunity to be fully heard.

The special committee had the power and authority to:

• • compel the attendance of witnesses;
• • to require the production of records and documents;
• • to hear submissions and evidence and to consider such facts as it considered necessary;
• • to conduct itself in the manner that it considers appropriate to the nature of the issues under review;
• • to make recommendations to the Legislative Assembly as to the course of action or options available as a result of hearing from interested persons.

While the special committee is clothed with parliamentary privilege and thus is the complete master of its own procedure, even to an extent larger than administrative tribunals in the normal course, it has been mindful of certain advisable standards to be adopted in considering the issues, Mr. Speaker.

The Legislative Assembly has complete authority to govern the conduct of its Members and statutory officers. In doing so, a public trust has been placed in the Assembly as a whole that it will do so with a view to protecting that public trust by ensuring both the integrity of its processes and the actions of Members and statutory officers. Because the office and duties of the Conflict of Interest Commissioner in and of itself deals with issues of integrity and the conduct of Members, the committee wished to take care not to improperly interfere with the statutory obligations imposed on the Conflict of Interest Commissioner and to be cognizant of and respect its necessary independence. Balanced against this is the duty of all statutory officers of the House to conduct themselves according to certain standards.

The special committee has attempted to deal with these issues on the basis of the following general principles:

• • ensuring a fair opportunity for interested persons to be fully heard. This opportunity must, in the circumstances, be extended equally and fully to the Minister and the Commissioner. The Commissioner is of the view that the complainant, Mr. Rowe, is an interested person and should be heard from as a party in these proceedings;
• • it must be aware of the roles and obligations of the Minister and the Commissioner as contemplated in the act which governs their respective duties;
• • it must be mindful of the public interest associated with not only this process but in the issue of governing the conduct of Members and statutory officers generally;
• • it must make any recommendations only on the basis of the facts and issues placed before it and not on the basis of other facts or issues, which are not before it in connection with this process.

Mr. Speaker, a number of these concepts or obligations have various different parts, which are elaborated below. However, the fundamental principle is that of fairness, and common sense is often the best guide to what is or is not fair to all of the interested parties.

In ensuring that interested parties have the right to be heard, it is important that:

• • each party or person clearly knows the position of the other party;
• • each party have the opportunity to be represented by counsel;
• • each party has a reasonable opportunity to prepare for the hearing, a reasonable opportunity to put forward their position and a reasonable opportunity to know and test the position of other parties. Testing the position of the other party can include cross-examining witnesses of the other party or calling witnesses to contradict. No person should be caught by surprise; and
• • each party has the opportunity to put the facts that they consider relevant before the committee and to make submissions on the law as it applies to the facts.

The special committee commenced its work by establishing time frames for the submission of written briefs by counsel for the Minister and counsel for the Conflict of Interest Commissioner. These time frames provided that the Minister would file material respecting the merits of her application by June 22, 2001, the Conflict of Interest Commissioner would file a brief responding to this by June 29, 2001 and the Minister would file a final response by July 4, 2001. The July 4, 2001 response date was changed by agreement to July 6, 2001.

The special committee anticipated that it would be in a position to conduct a public hearing Thursday, July 12, 2001 to deal with the application by the Honourable Jane Groenewegen in this matter. Due to various conflicting schedules, it was difficult to obtain a date for the hearing in sufficient time to allow for a report back to the House by July 23, 2001 as directed in the motion, which established the committee. This hearing date was available to all with the exception of the Conflict of Interest Commissioner, who had other previously scheduled commitments in Vancouver. However, it was anticipated that her counsel would be in attendance and that the Conflict of Interest Commissioner could be connected by telephone to the proceedings.

The written material was, for the most part, provided by the parties within the time frames established by the special committee. This written material was made available to the public in advance of the hearing.

The July 6, 2001 reply material of the Minister contained a request that the special committee hear evidence from witnesses to resolve a conflict in facts that appeared between the Minister and the Conflict of Interest Commissioner. This conflict in facts surrounded the question of what information the Conflict of Interest Commissioner had prior to any complaint being filed and as a result of a discussion and interview with Lee Selleck, a reporter for CBC North television. Counsel for the Minister urged that this conflict in facts was critical as it was alleged that the actions of the Conflict of Interest Commissioner could have been affected by any advance knowledge that she had regarding the details of the complaint. It was suggested that such knowledge could have affected the statements made in the media by the Conflict of Interest Commissioner and the approach in conducting the investigation, once a complaint was received.

The Conflict of Interest Commissioner in her written submissions, stated that the interview with Mr. Selleck dealt with conflict provisions generally and was not about a concern regarding a specific Member of the Legislative Assembly. She further asserted that any suggestion that she had received prior information from Mr. Selleck indicating that the Minister remained a director was incorrect. She stated in her submissions that the CBC reporter did not make her aware of the existence of documentation filed in the corporate registry concerning the identification of the Minister as a director of a company or companies.

The Minister alleged in her material that as a result of a conversation between the Conflict of Interest Commissioner and Lee Selleck on March 15, 2001 the Conflict of Interest Commissioner was aware of the existence of documentation filed with the corporate registry concerning the identification of the Minister as a director of a company or companies. It further alleged that the Conflict of Interest Commissioner was made aware that Mr. Selleck's investigation was based on his view that the Minister was in violation of the conflict of interest provisions of the Legislative Assembly and Executive Council Act.

The Minister further alleged that a tape-recorded telephone conversation between John Bayly, principal secretary and the Conflict of Interest Commissioner, which occurred March 26, 2001, confirmed these facts.

Mr. Speaker, in addition to this issue, the special committee has to some degree been hampered throughout by the absence of an executed contract between the Speaker and the lawyers for the Conflict of Interest Commissioner. Such a contract would provide that legal counsel for the Conflict of Interest Commissioner be paid for by the Government of the Northwest Territories. Disagreement arose between the Speaker and the lawyers for the Conflict of Interest Commissioner respecting certain specific terms of the requested contract.

The Speaker, while confirming that the relationship between the Conflict of Interest Commissioner and her lawyers is one of solicitor-client and thus confidential, requested that details of time spent be provided in legal bills sent to the Assembly so that the reasonableness of time and public costs expended could be assessed. The contract provided that in the event of any disagreement over time spent, the Clerk of the Supreme Court, as an independent third party, would review the bills. The lawyers for the Conflict of Interest Commissioner refused to sign a contract with these terms, stating that such terms violated the solicitor-client privilege of the relationship and undermined the independence of the Conflict of Interest Commissioner's office.

They further stated that as the Law Clerk was responsible for advising the Speaker on the terms of the contract and advising the special committee respecting its functions, this represented a conflict of interest and the Law Clerk should be discharged from her role as legal advisor to the special committee.

The lawyers for the Conflict of Interest Commissioner advised the special committee July 11, 2001, that they would not be attending the public hearing scheduled for the following day. This correspondence stated that "The untenable position in which the Conflict of Interest Commissioner has been placed, described in detail in our previous correspondence, required her to instruct us not to travel to Yellowknife today for the meeting of the special committee."

Therefore, as July 12, 2001 approached, it became clear that various threshold issues had to be decided and it was unlikely that the hearing could proceed as originally intended. These issues, Mr. Speaker, were as follows:

1. Whether new legal counsel should be engaged to advise the special committee, replacing the Law Clerk, as requested by counsel for the Conflict of Interest Commissioner;

2. What, if any, steps could be taken by the special committee to resolve the issue of legal representation for the Conflict of Interest Commissioner;

3. Should the special committee hear evidence from witnesses and if so, what witnesses should be requested to appear before the special committee;

4. Should the special committee conduct any of its proceedings in camera? It was suggested by counsel for the Minister that some aspects of the evidence should be taken in camera;

5. If witnesses were called, how procedurally should their evidence be presented;
6. Should the tape recording and transcript of it respecting the March 26, 2001 telephone conversation between John Bayly and the Conflict Commissioner be provided to the Conflict of Interest Commissioner's lawyers as requested by them; and

7. Should a portion of the investigation report of the Conflict of Interest Commissioner be sealed and delivered to the special committee until conclusion of the matter as requested by counsel for the Minister?

On July 12, 2001, the committee met in camera to decide the question of whether new legal counsel should be retained. The committee decided not to do so and to continue with the services of the Law Clerk.

The public meeting was convened in the afternoon of July 12, 2001. Mr. Chivers, legal counsel for the Minister, was in attendance. Further faxed submissions were sent by counsel for the Conflict of Interest Commissioner respecting the issue of whether evidence should be called.

As a result of consideration of the various issues, and upon reviewing the submissions of counsel for the Conflict of Interest Commissioner and those of Mr. Chivers, the following decisions were made:

1. As the Speaker has exclusive authority respecting any contract for legal counsel for the Conflict of Interest Commissioner, this matter was referred back to him in the hope that it could be expeditiously resolved;
2. The special committee decided that it was necessary to hear evidence from witnesses to clarify certain issues and facts. In this regard, it directed that invitations to attend before the committee be issued to the Minister, the Conflict of Interest Commissioner, John Bayly, Wendy Morgan, Jack Rowe and Lee Selleck;
3. Mr. Chivers indicated his willingness to provide a transcript of the tape-recorded March 26, 2001 telephone conversation to the Law Clerk for provision to the lawyers for the Conflict of Interest Commissioner. It was directed that this transcript be so provided;
4. The special committee declined to have a copy of the transcript for its information as the admissibility of this material could be in issue. Committee members therefore, as at the date of this report, have not been provided with this transcript and are not privy to any information that it may contain;
5. Mr. Chivers did not press for any portion of the proceedings to be held in camera. The special committee therefore directed that proceedings would continue to be in public. If any application was made at a future point to go in camera, it would be assessed on the merits and reasons for that request;
6. The special committee directed that the Conflict of Interest Commissioner continue to hold her investigation report as originally directed by the Legislative Assembly in its June 12, 2001 motion;
7. The special committee indicated its wish to reconvene the public hearing July 24th to 26th, 2001 if it was granted an extended mandate from the Legislative Assembly and if witnesses and counsel were all available. It further directed that if these dates were not acceptable, that alternate dates be canvassed with all concerned; and
8. The special committee concluded that it would submit its report to the Legislative Assembly July 23, 2001, indicating that it was unable to conclude its tasks. A further extension of time would be sought to allow it to conduct the hearing and conclude its mandate.

The Committee Clerk sent notices to the witnesses required for the hearing on July 13, 2001. It was determined that Mr. Selleck was declining to appear and Mr. Bayly would be required to return from Ontario in order to attend the July dates for the hearing. Mr. Rowe, Ms. Morgan, and the Minister confirmed that they would be available on the dates outlined by the special committee. On July 17, 2001, the special committee was advised by correspondence from counsel for the Conflict of Interest Commissioner that they would be unable to attend on the dates tentatively established. It appeared that the special committee's attempts to quickly conclude this matter would again be frustrated by a combination of circumstances.

Issues, Mr. Speaker, also arose with respect to the tape recording of the March 26, 2001 telephone conversation between John Bayly and the Conflict of Interest Commissioner, to which the Minister was privy.

The Minister was prepared throughout to provide an audio copy of the March 26, 2001 telephone conversation. She indicated that any other matters on the tape in question were confidential and should not be disclosed to third parties. Counsel for the Conflict of Interest Commissioner wanted a copy of the entire tape, indicating that there may be other matters on the tape which were relevant to either the March 26, 2001 telephone conversation or issues generally touching upon matters before the special committee. After some difficulties, the tape in question was delivered to the Law Clerk, to be held pending further consideration of whether a portion of the tape or the tape in its entirety should be copied and provided to counsel for the Conflict of Interest Commissioner.

Attempts were then commenced to establish new dates for the hearing. However, on July 18, 2001 correspondence was received from counsel for the Minister requesting that they be permitted to withdraw the original application. While the Minister remained convinced of the merits of her application, her concern was that the proceedings had become far more protracted and costly than was warranted. This correspondence quite properly was framed as a request. This is due to the fact that once the matter is before the special committee, it is for the House to ultimately decide on the appropriate conclusion of matters. If it so wished, the House could direct that the matter be completed irrespective of the request to withdraw by the Minister.

The request to withdraw was forwarded to counsel for the Conflict of Interest Commissioner, requesting that they advise whether they agreed or disagreed with the request. The Conflict of Interest Commissioner responded with correspondence dated July 20, 2001 directed to the chair of the special committee. The correspondence did not squarely address the question of whether or not she agreed with the request to withdraw. However, the Conflict of Interest Commissioner did indicate relief that the Minister had decided to withdraw the application. In doing so, she communicated concerns that the fairness and propriety of her conduct and the integrity of her office had been brought into question by the Minister in a most public and protracted way. Further lengthy materials in the form of speaking notes of counsel were also submitted. The materials did not go to the question of whether there was agreement about withdrawal of the application.

The special committee felt it was necessary to have a further public meeting prior to session commencing to consider its options and to draft its report to the House.

The special committee convened a further public meeting on the afternoon of July 22, 2001 to consider the request to withdraw the application, to assess its options and finalize its report to the House. Counsel was not present for the Minister or Conflict of Interest Commissioner. The further lengthy submissions from counsel for the Conflict of Interest Commissioner were not considered, as the submissions went primarily to the merits of the bias issue.

The special committee considered three possible options respecting recommendations that could be made to the Legislative Assembly:

1. That the matter is considered concluded on the basis of the request to withdraw the application, and that no further action by the special committee is mandated;
2. That the matter goes forward irrespective of the Minister's request to withdraw the application;
3. That the committee be reconstituted to look at related issues of conduct of Members and statutory officers of the House and others.

During the course of the meeting, the Minister requested an opportunity to clarify a matter. As the comments made by the Minister were not clarification but essentially a submission on what should be done with the investigation report, the special committee did not take those remarks into consideration.

The special committee has significant concerns that a number of varied and serious allegations have been made, which at the present point in time have no definitive resolution. These allegations include:

• • The allegation by the Minister that the statutory functions of the Conflict of Interest Commissioner have not been duly carried out and are affected by a reasonable apprehension of bias on the part of the Conflict of Interest Commissioner in the conduct of her investigation of the Rowe complaint;
• • The allegation of the Minister that the written submissions made on behalf of the Conflict of Interest Commissioner contain serious factual discrepancies;
• • The allegation of the Minister that there has been a "pattern of avoidance" on the part of the Conflict of Interest Commissioner in dealing with this matter and the process of the special committee;
• • The allegation of the Conflict of Interest Commissioner that neither the Board of Management nor the Legislative Assembly, through the special committee, ought to have undertaken a review in this manner respecting her actions;
• • The allegation of the Conflict of Interest Commissioner that it has been an unfair process and improper to require her to defend her actions and that the Speaker has undermined her independence by placing any limitations on her right to counsel;
• • The allegation of the Conflict of Interest Commissioner that her concerns about the process are compounded when the application to withdraw is made in the face of seeming pressure to produce the whole of the tape recording.

These allegations and innuendo which flow from them are indeed very serious. Quite apart from the various allegations made by each the Minister and Conflict of Interest Commissioner, the special committee is disturbed by the steps by both which have resulted in the process being both more costly and protracted. It is disturbed that the factual accuracy of material put before it may be in question. It is disturbed by the knowledge of a telephone conversation occurring between senior staff and a statutory officer of the House, which was surreptitiously tape-recorded.

In the view of the special committee, serious issues of public confidence have been raised by these proceedings to date. Mr. Speaker, these include:

1. The Office of the Conflict of Interest Commissioner is charged with a variety of functions. One such function is to ensure that Members meet the requirements of the act respecting conflict avoidance. In addition, the general goal is to ensure that Members of the Legislative Assembly conduct themselves in a manner which engenders public trust and confidence in their integrity. The office must therefore be in a position to deal fearlessly with complaints of infractions and with independence from political influence or interference. Members should exercise the utmost judgment in bringing forward allegations concerning the due conduct of these responsibilities. However, once such a question is raised, the Assembly must also ensure that the fulfillment of these serious statutory obligations is beyond reproach and it has a duty to ensure that the confidence of the public is duly entrusted to this office and those who occupy it. Once such a controversy has been embarked upon, the air must be cleared so both the confidence of Members and that of the public at large can be restored.
2. The ability of a Conflict of Interest Commissioner to properly fulfill his or her statutory duties depends to a large degree on maintaining an effective working relationship with Members. This is particularly so as the Commissioner must provide advice on an ongoing basis to Members with respect to the proper ordering of their interests. When a cloud has been cast over the conduct of a Conflict of Interest Commissioner, the maintenance of such relationship becomes very difficult, if not impossible.
3. The conduct of Members of the Legislative Assembly reflects on the credibility of the Assembly and its ability to maintain public confidence in its actions and initiatives. The public deserves to know that its faith in the integrity of Members of the Legislative Assembly is rightfully sustained.

Furthermore, the striking of a special committee to deal with such serious issues requires a high level of conduct and professionalism for those who actively participate in this process. It requires that those who undertake roles do so in a way that assists the special committee in fulfilling its mandate. Direct and concise responses to issues, attendance at committee hearings, use of appropriate language in written submissions and due respect for the special committee process and requirements should all be present without question. These standards have been noticeably absent at various stages of the proceedings to date.

Due to the serious issues respecting public confidence, which have been raised to date, the special committee therefore seeks a further mandate from the Legislative Assembly to conduct a review of allegations of bias together with the questions of conduct, which have presented themselves to date. While this process does require expenditure of public funds, the committee is greatly concerned that should matters abruptly cease at this juncture, significant funds which have been expended to date will have resulted in only doubts and questions being raised without answers and definitive conclusions. Absent a conclusion to this review, there will continue to be a cloud hanging over the reputations of both statutory officers of the House and Members.

Therefore, the special committee is recommending to the Legislative Assembly the following:

1. that the Legislative Assembly approve the request of the Honourable Jane Groenewegen to withdraw the application, as filed with the Board of Management on May 7, 2001;
2. that the Legislative Assembly advise the Conflict of Interest Commissioner that she may transmit her report on the investigation to the Speaker;
3. that notwithstanding the withdrawal of the application, the Legislative Assembly authorizes and extends the mandate of the Special Committee on Conflict Process to consider the allegation of an apprehension of bias in relation to the investigation conducted by the Conflict of Interest Commissioner, and to consider related matters which have arisen or may arise during the normal course of proceedings of the special committee;
4. that the Legislative Assembly instructs the Special Committee on Conflict Process to undertake its extended mandate as expeditiously as possible and to report to the Legislative Assembly at the next session, no later than October 23, 2001; and
5. that the authority and terms of reference of the Special Committee on Conflict Process as approved by the Legislative Assembly are hereby amended and extended with the adoption of this report.

The tasks that the Legislative Assembly mandated the special committee to consider became a daunting proposition and one that each of the committee members found difficult at times. The members of the special committee were vigilant to ensure that whatever approaches were taken, fair opportunities were afforded to those who may be affected by the process we embarked upon. If the Legislative Assembly approves our recommendations, I can assure you that we will continue to apply our best efforts to give fair consideration of the issues. The special committee would like to express its appreciation and confidence in the assistance provided to it by the Clerk and Law Clerk. This concludes our report as required by our terms of reference and it is commended to the Legislative Assembly for its consideration.

Therefore, I move, seconded by the honourable Member for Inuvik Boot Lake, that the report of the Special Committee on Conflict Process be received by the Legislative Assembly and referred to committee of the whole.

Thank you, Mr. Bell. We have a motion on the floor. The motion is in order. To the motion. Question has been called. All those in favour, please signify. Thank you. All those opposed? The motion is carried.

The Chair recognizes the honourable Member for Yellowknife South, Mr. Bell.

Mr. Speaker, I seek unanimous consent to waive Rule 93(4) and have the report of the Special Committee on Conflict Process moved into committee of the whole for today and be considered as the first item of business.

Thank you, Mr. Bell. The honourable Member is seeking unanimous consent to waive Rule 93(4) and have the report of the Special Committee on Conflict Process moved into committee of the whole for today. Are there any nays? There are no nays. You have unanimous consent to move the report into committee of the whole for today and to be considered as the first item of business.

Item 11, reports of standing and special committees. Item 12, reports of committees on the review of bills. The honourable Member for Inuvik Boot Lake, Mr. Roland.

Thank you, Mr. Speaker. Mr. Speaker, I wish to report to the Legislative Assembly that the Standing Committee on Governance and Economic Development has reviewed Bill 2, An Act to Amend the Income Tax Act, and wishes to report that Bill 2 is ready for consideration in committee of the whole.

Mr. Speaker, I request unanimous consent to waive Rule 70(5) and have Bill 2 ordered into committee of the whole for today. Thank you, Mr. Speaker.