A Stark Warning To Candidates For Municipal Office When Filing Their Campaign Election Statements

• Published date: 06 July 2020
• Subject Matter: Litigation, Mediation & Arbitration, Trials & Appeals & Compensation
• Law Firm: Aird & Berlis LLP
• Author: Mr John Mascarin

INTRODUCTION

The Ontario Court of Appeal made headlines recently when it released its decision in Karygiannis v. Toronto (City), 2020 ONCA 411, removing Toronto City Councillor Jim Karygiannis from office for the second time this term.

While most of the focus has been on its political implications the decision provides important clarification of the campaign financing laws set out in the Municipal Elections Act 1996 (the 'MEA'). The decision should serve as a cautionary tale to candidates for municipal office. Those who do not correctly file financial statements can and will be removed from office with no chance for judicial intervention.

BACKGROUND

Mr. Karygiannis was re-elected to office on October 22, 2018 When he first submitted his campaign spending report, he disclosed expenditures within the general spending limit of $61,207.80, and the limit on expressions of gratitude of $6,120.78 (being 10% of the total spending limited). However, following an audit, he submitted a revised spending financial report which included expenses for a dinner and a victory party as expressions of gratitude, putting him nearly $26,000 over the limit. Mr Karygiannis's financial statements were prepared by a professional accountant, but the councillor himself signed and filed them.

Subsection 88.23(2) of the MEA provides that if a candidate for municipal office submits a financial statement that shows, on its face, that he or she spent more than the allowable limit, the candidate automatically forfeits the office and cannot run again until after the next general election. Section 92 of the MEA makes it an offence to spend more than the prescribed limit. However, if there is a prosecution under section 92 of the Act, the presiding judge can provide relief from the penalties found in both sections 88.23 and 92.

THE DECISION

The application judge had determined that the MEA created an absurdity. He reasoned that the Legislature could not have intended to provide for an automatic removal from office in one section, but for possible leniency if a member was actually convicted of an offence in another section. The application judge granted Mr Karygiannis relief from forfeiture of office under subsection 92(2) of the Act.

The decision was appealed. The Court of Appeal dealt with two possible grounds of relief: subsection 92(2) of the MEA, and section 98 of the Courts of Justice Act, which gives judges broad powers to grant relief against penalties and forfeitures.

Unusually...