1 2 3 4 TORONTO COMPUTER LEASING INQUIRY 5 6 7 8 ******************** 9 10 11 BEFORE: THE HONOURABLE MADAM JUSTICE DENISE BELLAMY, 12 COMMISSIONER 13 14 15 16 17 Held at: East York Civic Centre 18 850 Coxwell Avenue 19 Toronto, Ontario 20 M4C 5R1 21 22 ******************** 23 24 25 May 8th, 2003

2
  1                        APPEARANCES
  2  Ronald Manes            )Commission Counsel 
  3  Patrick Moore  (np)     )
  4  Daina Groskaufmanis     ) 
  5  Linda Rothstein         )City of Toronto 
  6  Lily Harmer    (np)     )
  7  Robert Centa            )
  8  Gordon Capern  (np)     )
  9  David Moore    (np)     )MFP 
 10  Fraser Berrill          ) 
 11  Ken Jones      (np)     ) 
 12  Brian Heller   (np)     )Ball Hsu and Associates Ltd.
 13  Melissa Kronick (np)    )CUPE 
 14  Raj Anand      (np)     )Lana Viinamae
 15  Bay Ryley               )
 16  William Anderson        )Wanda Liczyk
 17  Valerie Dyer    (np)    )Dell Computers
 18  Jennifer Lynch          )
 19  Edward Greenspan (np)   )Jeff Lyons
 20  Todd White              )
 21  Hugh MacKenzie  (np)    )Jim Andrew
 22  Jennifer Searle (np)    )
 23  Bryan McPhadden (np)    )Brendan Power
 24  
 25  Joyce Ihamaki           )Registrar

1 TABLE OF CONTENTS 2 Page 3 4 Exhibits 4 5 6 Jeffrey Stephen Lyons, Sworn, 7 Examination In-Chief by Mr. Ronald Manes 5 8 9 Certificate of Transcript 202 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

1 EXHIBITS 2 Exhibit No. Description Page No. 3 4 32 VOLUME I Bound document titled 22 5 "Jeff Lyons" tabs 1-44. 6 7 32 VOLUME II Bound document titled 22 8 "Jeff Lyons" tabs 1-36. 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25

1 --- Upon commencing at 10:00 a.m. 2 3 THE REGISTRAR: The Inquiry is now in session. 4 Please be seated. 5 6 (BRIEF PAUSE) 7 8 MADAM COMMISSIONER: Good morning. 9 MR. RONALD MANES: Good morning, Commissioner. 10 11 (BRIEF PAUSE) 12 13 JEFFREY STEPHEN LYONS, Sworn; 14 15 MADAM COMMISSIONER: Good morning. 16 17 EXAMINATION-IN-CHIEF BY MR. RONALD MANES: 18 Q: Good morning, Mr. Lyons. 19 A: Good morning. 20 Q: Before we talk about your career as a 21 lawyer or lobbyist, when you came here, you had been served 22 with a summons? 23 A: Yes. 24 Q: The -- the summons requires you to bring 25 all relevant documents that you may have in your -- to read

1 it, custody, possession or power. My question to you is do 2 you have any -- any documents? Have you brought any 3 documents here today that could be relevant or helpful to the 4 Commissioner? 5 A: No. 6 MR. TODD WHITE: I think Mr. Manes means apart 7 from the ones that he's already provided? 8 MADAM COMMISSIONER: Yes. 9 MR. TODD WHITE: It's -- 10 MR. RONALD MANES: That's quite right. 11 THE WITNESS: No. 12 13 CONTINUED BY MR. RONALD MANES: 14 Q: The ones that you had provided previously 15 related to MFP. You gave us several documents regarding your 16 relationship with MFP but we've received nothing with respect 17 to your relationship with Dell Financial or Dell Computer. 18 Do you have any files or faxes or memorandums, letters, 19 retainer agreements, anything in relation to your 20 representation of Dell Computer, Dell Financial? 21 A: No. 22 Q: The evidence which Ms. Cross gave the 23 other day was that the -- your files were kept in an unlocked 24 cabinet behind your administrative assistant -- assistant. 25 Is that right?

1 A: Yes. 2 Q: When you left Morrison, Brown and 3 Sosnovitch, I take it you took the MFP file because you were 4 able to give that to us but what happened to the Dell 5 Financial file and the Dell Computer file? 6 A: Well, normally we don't keep files once we 7 cease acting for the clients unless there's some document 8 that we require, you know, for long term purposes. So there 9 was nothing there to keep. 10 Q: Those -- when you say nothing to keep, 11 after a certain period of time do you destroy these files? 12 A: Usually immediately when we're not acting 13 because we were short for room in our filing cabinet. 14 Q: Do you remember when you ended acting for 15 Dell Computer, on anything? 16 A: Well, around the end of 2001, something 17 like that. 18 Q: And Dell Financial? 19 A: Oh, that was right after this event, I 20 guess, July '99. 21 Q: All right. In the case of Dell Computer, 22 Dell Financial Services, then the files would have been 23 destroyed on or about when you ceased acting for them? 24 A: I can't be certain as to the exact date, 25 but, in around there.

1 Q: Would you have personal knowledge of that, 2 or would that have been done by somebody else in your firm, 3 at the time? 4 A: It could have been done by someone else. 5 Q: Was there a regular process of destroying 6 files after they -- after you were done working on them or 7 was that something that you would have had to give 8 instruction on? 9 A: Well, we tried to weed them out if we're 10 not using them and we try to do that within a few weeks or 11 months of the -- of acting for them. 12 Q: In this -- in the specific case, Dell 13 Computer, DFS, do you recall whether you specifically gave 14 the instruction to destroy those files, to the best of your 15 recollection? 16 A: Probably. 17 18 (BRIEF PAUSE) 19 20 Q: In any event, those files aren't 21 available, you've looked for them? 22 A: Yes, I did. 23 Q: Now, we've inquired of Morrison Brown and 24 Sosnovitch, they've gotten back to us and said they didn't 25 have them. So, I take it that when you left them, either the

1 files were destroyed or they were destroyed after you left 2 them? 3 A: What was the question again sorry? 4 Q: Let me ask the question this way. When 5 you left Morrison Brown and Sosnovitch, do you remember 6 taking the Dell Financial or Dell Computer files? 7 A: Not Dell Financial. Dell Computer might 8 still have been a client. 9 Q: You left Morrison Brown Sosnovitch, on 10 what date, approximately? 11 A: June of 2001. 12 13 (BRIEF PAUSE) 14 15 Q: Now, MFP wasn't a client obviously at that 16 point, June 2001? 17 A: Yes, they were. 18 Q: Oh, they were -- 19 A: Right -- 20 Q: -- that's quite right. So, when you left 21 do you remember whether you took the Dell Computer file, when 22 you left Morrison Brown and Sosnovitch? 23 A: If I was still acting, we definitely took 24 it. 25 Q: And do you remember whether you took the

1 Dell Financial file? 2 A: I doubt it. 3 Q: In any event, you've done a search and 4 those files -- 5 A: Are not -- 6 Q: -- right -- 7 A: -- no. 8 MADAM COMMISSIONER: Just help me, Mr. Lyons, 9 when you talk about the files that you took with you or 10 didn't take with you, were these files in which you were 11 acting in a capacity as a lawyer, or as a consultant or 12 lobbyist or both or neither or? 13 THE WITNESS: Well, in most cases, I was 14 acting as a consultant. 15 MADAM COMMISSIONER: Okay. 16 THE WITNESS: If there was anything of a legal 17 nature it would have been being done by other people in the 18 law firm, not me. 19 MADAM COMMISSIONER: Okay. Thanks. 20 21 CONTINUED BY MR. RONALD MANES: 22 Q: Actually, that is one (1) of the 23 questions, one (1) of the issues, that I do want to go into 24 with you, a bit later. 25 But, let's talk about your career as a lawyer

1 and as a lobbyist. You have been a lawyer for, by my count, 2 approximately thirty seven (37) years? 3 A: Yes. 4 Q: '66 -- 1966 call to the Bar? 5 A: Yes. 6 Q: Named Queen's Counsel 1977? 7 A: Yes. 8 Q: You were a Bencher at the Law Society of 9 Upper Canada 1983 to 1991? 10 A: Yes. 11 MADAM COMMISSIONER: Pardon, 1983 to '91? 12 MR. RONALD MANES: Yes. 13 14 CONTINUED BY MR. RONALD MANES: 15 Q: That Bench of the Law Society, that is a 16 position in which you are elected by your peers? 17 A: Yes. 18 Q: And you would have been elected on two (2) 19 occasions to two (2) consecutive terms? 20 A: Yes. 21 Q: Your function as a -- as a Bencher of the 22 Law Society, Benchers are the governors of the Law Society? 23 Governors of the -- of the lawyers in the province? 24 A: Yes. 25 Q: And they regulate the conduct of lawyers,

1 including providing Code of Professional Conduct? 2 A: They would regulate it, yes. 3 Q: The -- that code would include issues such 4 as fees and conflicts and disclosure? 5 A: Well, they set the rules of professional 6 conduct -- 7 Q: Include -- 8 A: -- and that would include -- are you 9 mentioning conflict? Yes. 10 Q: All right and fees, such as charging 11 contingent fees? 12 A: Yes. 13 Q: All right. Now, that -- those apply only 14 when you're acting as a lawyer? It doesn't apply when you're 15 acting as a lobbyist? 16 A: That would -- yes. 17 Q: All right. The Law Society has no 18 jurisdiction over the activities of lobbyists? They are -- 19 correct? Unless you're acting, as well, as a lawyer at the 20 same time? 21 A: That would be my understanding because you 22 wouldn't be practicing law. 23 Q: Right. 24 A: I mean, as long as you're not practicing 25 law, then I don't see where these rules have application.

1 Q: All right. The -- you had your own firm 2 for twenty-two (22) years, approximately? 3 A: Yes. 4 Q: And that grew over time to approximately 5 forty-five (45) lawyers? 6 A: Yes. 7 Q: As I understand it, that firm then 8 disbanded about 1990 and you became associated with other 9 firms? 10 A: That's correct. 11 Q: And one of those firms that you had a 12 formal association with -- I think maybe the last firm that 13 you had a formal association with was Morrison Brown 14 Sosnovitch? 15 A: That's correct. 16 Q: Now, when did that association start with 17 Morrison Brown Sosnovitch? 18 A: My association with them? 19 Q: Yes. 20 A: I think December of 1995. 21 Q: Now, on the -- on the letterhead and other 22 documents, you're called counsel. Could you explain what 23 that means, to be counsel to Morrison Brown Sosnovitch? 24 A: I think it's more of a title, partly 25 because I wasn't a partner and I think they wanted to feature

1 me on their letterhead so -- because they wanted me partly as 2 a rainmaker. 3 Q: All right. Now, at the time that -- at 4 the time you became associated with Morrison Brown Sosnovitch 5 as a counsel, were you practicing law anymore? 6 A: Not really. 7 Q: All right. 8 A: I was doing some administrative law but -- 9 Q: In relation to -- to Dell Financial 10 Services, Dell Computer were you engaged in giving them legal 11 advice or practising law when they retained you? 12 A: No. 13 Q: All right. Now, as I understand your 14 practice when you were practicing law, you did insurance, 15 negligence and product liability cases for a good twenty (20) 16 years? 17 A: That's correct. 18 Q: And I recall -- understand that early on 19 in your career you made a name for yourself doing product 20 liability cases and in particular, the Aitkin case involving 21 -- was it rusty Ford's? 22 A: Yes, I was the one (1) that, sort of, 23 pioneered class actions in this country, with that case. 24 Q: Do you -- as I recall and we'll come to 25 it, talk about that on your website, for the Lyons Group?

15
  1                 A:  Yes, 'cause it was one (1) of the great
  2  accomplishments of my legal career, is what you see today in
  3  class actions.
  4                 Q:  That -- that Aitkin case, that was a class
  5  action under the Class Proceedings Act, or was there such an
  6  Act, at the time?
  7                 A:  No, there wasn't, it was Rule 75, which we
  8  went all the way to the Supreme Court of Canada, on the
  9  ability to bring a class action.
 10                 And when that was struck down by the Supreme
 11  Court of Canada, they proceeded to do a white paper on class
 12  proceedings, and then brought forward this Class Proceedings
 13  Act, that now permits class actions.  The Rule just wasn't
 14  broad enough at the time.
 15                 Q:  All right.  That Class Proceedings Act, as
 16  I recall, you would recall, that permitted contingent fees?
 17                 A:  The Class Proceedings Act?
 18                 Q:  Yes?
 19                 A:  Yes, it does.
 20                 Q:  All right.  And again we'll have some
 21  discussion about that.  In terms of your legal career, in
 22  particular, your doing insurance negligence work and product
 23  liability, as I recall, at some point no fault insurance was
 24  coming along the horizon and your practice changed a bit?
 25                 A:  Yes.

1 Q: And could you describe how it changed as a 2 result of no fault and perhaps other factors? 3 A: Well, we were all into, about twelve (12) 4 lawyers doing insurance work. But, we were concerned in the 5 early -- late 80's, early 90's, about no fault, because there 6 might have been a prohibition against lawsuits for pain and 7 suffering. 8 Or there might have been a threshold, which 9 really does exist today, but, what little people realized, 10 was that the lawyers made a whole business out of 11 representing people dealing with no fault benefits. And 12 actually the industry grew. 13 Q: As it turned out? 14 A: As it turned out. 15 Q: But, you didn't foresee that? 16 A: Well, I got -- to be very frank, got 17 bored. During jury cases all the time, or trials involving 18 fender benders and the insurance company was your defendant, 19 who really didn't care much about the result and you put all 20 that effort in, for little return. 21 And it was the same issues. Every case was 22 the same. 23 Q: So when -- when did your -- when did you 24 change direction? 25 A: When I joined this firm, Fogler, Rubinoff.

1 Q: And that was in what -- 2 A: 90 -- 1990. 3 Q: That was after your firm had disbanded? 4 A: Yes. 5 Q: And so you joined about 1990 and what 6 kind of work did you do for them? First of all, did you do 7 legal work? 8 A: Yes, I did some. I was working on 9 municipal -- some municipal issues. I actually filled my 10 time part-time as the Chairman of an insurance group. It was 11 sort of a potpourri of different things -- different issues 12 -- different files. 13 Q: Now, just to put this in perspective, as 14 well, you served on the Board of the TTC, for ten (10) years, 15 '79 to '89? 16 A: Did you say Chair? 17 Q: No, just served on? 18 A: Served on it, yes. 19 Q: And from 1979 to 1989? 20 A: That's correct. 21 Q: All right. And you became Chair from 1987 22 to 1989? 23 A: That's correct. 24 Q: Dealt with some municipal issues in that 25 capacity?

1 A: You mean, at the TTC -- 2 Q: Yes -- 3 A: -- we'd be dealing with -- yes. 4 Q: Just trying to get an idea, you know, of 5 the kind of practice that you had -- 6 A: Right -- 7 Q: -- and experience at that time, in terms 8 of municipal affairs. 9 A: Right. 10 Q: You were at Fogler Rubinoff for how many 11 years? 12 A: Five (5) years. 13 Q: Five (5) years, and that's when you then 14 went over to Morrison Brown Sosnovitch? 15 A: That's correct. 16 Q: So by the time you went over there you, in 17 effect, were no longer practising law? 18 A: Essentially. 19 Q: All right. 20 A: I might have had a couple files I was 21 cleaning up in the first year or two (2). 22 Q: Now, you said previously in your evidence 23 that when you were over there -- in terms of your 24 relationship with the -- with the firm -- they -- you worked 25 more on a partner. They sort of wanted you on their

1 letterhead, but you were basically a rainmaker? 2 A: Yes. 3 Q: All right. Am I right, Mr. Lyons, that in 4 terms of rainmaking, you never practised law 100 percent. 5 Rainmaking was always part of what you did? 6 A: Yes. I enjoyed the rainmaking. 7 MADAM COMMISSIONER: Is someone going to ever 8 tell us what they think rainmaking is? 9 MR. RONALD MANES: Well, that's my next 10 question, Commissioner. 11 MADAM COMMISSIONER: Okay, good. 12 CONTINUED BY MR. RONALD MANES: 13 Q: Could you tell -- could you tell us what 14 rainmakers do? 15 A: They introduce the clients and I consider 16 that to have some value in a law firm. 17 Q: Could you expand on that? What do you 18 mean they introduce the clients? 19 A: Well, the rainmaker brings in the business 20 and probably tries to maintain the business and doesn't 21 necessarily do the production. 22 Q: The -- let's see if I have this right. 23 The rainmaker would bring in the business, not necessarily do 24 it? 25 A: Yes.

1 Q: All right. It involves spending time with 2 people? Cultivating relationships with people? 3 A: Absolutely. 4 Q: And you do favours for them, they do 5 favours for you? 6 A: Well, I don't know if it's favours but you 7 develop a relationship and -- and you -- you -- probably the 8 most important thing you can do for a client is service them 9 and it's -- I think that's what they want. Most of these 10 clients don't need favours. I think they want service. 11 Q: When I say favours for them, they for you, 12 you might give them tickets to something or you might give 13 them legal work at gratis, for free, or a reduced fee? 14 A: That could hap -- that could occur on 15 occasion. 16 Q: So, when I say that you do favours for 17 them and they can do favours for you, that's all part of 18 rainmaking and building relationships? Isn't that fair? 19 A: That would be part of it. 20 Q: All right. Now, in conjunction with all 21 this, you're -- you're practising law and you're -- you're 22 rainmaking which you bring in these clients to the firm. 23 You're also involved in fundraising? 24 A: Yes. 25 Q: Now, as -- as -- as I understand it,

1 fundraising for -- in the political area? Charitable? 2 A: Charitable as much as political. 3 Q: Do -- Now, there's a quote in one of these 4 articles that you had toyed with politics but you settled on 5 being a fundraiser. Is that -- 6 A: Well, I en -- I enjoyed it and I don't 7 think I wanted to be serving an elected office. 8 Q: You did extensive fundraising for the Tory 9 party? 10 A: Yes. 11 Q: That would be Provincial and Federal? 12 A: Yes. 13 Q: Also fundraising for municipal Councils? 14 A: Yes. 15 Q: This article, I'll take you to it if need 16 be but you're quoted as -- as saying that -- that you're a 17 great networker. That, quote: 18 "Everyone knows that I am connected." 19 That's quoting you. Is that -- is that an 20 accurate quote? You are a great networker and -- 21 A: Yes. 22 Q: -- you are connected? 23 A: Yes. 24 MADAM COMMISSIONER: Mr. Manes, can you tell 25 us what you're quoting from, please? Is that in the

1 material? 2 MR. RONALD MANES: Yes. 3 MADAM COMMISSIONER: Okay. 4 MR. RONALD MANES: I can take you there. It's 5 Volume 1, both Volumes 1 and 2, should be entered as 6 Exhibits, at this time -- 7 THE WITNESS: Yes, I have them here. 8 REGISTRAR: So it will be Exhibit 32, Volume 1 9 and Volume 2. 10 THE WITNESS: 32? 11 MADAM COMMISSIONER: It's our Exhibit number, 12 Mr. Lyons. 13 14 --- EXHIBIT NO. 32 VOLUME I: Bound document titled "Jeff 15 Lyons" tabs 1-44. 16 17 --- EXHIBIT NO. 32 VOLUME II: Bound document titled "Jeff 18 Lyons" tabs 1-36. 19 20 CONTINUED BY MR. RONALD MANES: 21 Q: That would be Tab 15 -- and I'm going to 22 make reference to this article that's Begdoc -- that's our 23 code number for these, our data bank number, that's Begdoc 24 43061. 25 And this is an article about you, entitled the

1 Lyons King, by Bruce Livesey, L-I-V-E-S-E-Y, Livesey. 2 Remember being interviewed for that article? 3 A: Yes. 4 Q: All right. And you're quoted several 5 times, and that's just -- the quote that I'm talking about is 6 after that first small indented paragraph about six (6) down: 7 "Everyone knows I'm -- 8 A: I see it here, yes. 9 Q: " -- a great networker." 10 A: I see it. 11 Q: All right. 12 13 (BRIEF PAUSE) 14 15 Q: And this article goes on to say, this is 16 at 40361, quoting you as saying: 17 "Everyone wants to be part of my Rolodex, I 18 have a great Rolodex." 19 That's accurate? 20 A: Yes. 21 Q: What do you mean, you have a great 22 Rolodex? 23 A: Well, I was being a bit flippant, but, I 24 do have -- I do enjoy meeting people and as you say, I 25 describe myself as a rainmaker, so I -- you know, have a lot

1 of contacts in a lot of different areas. People I've met 2 over the number of years, that I've been just doing business 3 in the City. 4 Q: Just to put this all in perspective, many 5 of the people who you meet during the course of your 6 fundraising or for whom you fundraise, you consider friends? 7 A: Well, I'm friendly with them. It depends, 8 I mean, some become true friends and others are just -- you 9 become friendly. Or they're professional relationships. 10 Q: At the bottom of that second page, at Tab 11 15, 43062, in talking about the election, I take in 1999, you 12 were quoted as saying, well I should read this: 13 "In fact, during last years Ontario 14 election, Lyons helped raise money for 15 between thirty (30) and forty (40) Tory 16 candidates, some of whom are currently 17 cabinet ministers. In a deposition he gave 18 last year for a lawsuit, he said he 19 probably attended fundraisers for virtually 20 every member of the cabinet." 21 And then quoting you: 22 "Most of these people that I raise money 23 for (have been personal friends of mine) 24 Lyons said." 25 Would that be accurate?

1 A: Well, first of all, that's referring to 2 the provincial party and some of these cabinet minister have 3 been friends of mine, because I've been involved in Tory 4 politics for forty (40) years and some of them go back about 5 forty (40) years, so -- some would -- most of them I was 6 friendly with. 7 It was probably an exaggerated comment, and 8 some of them if I've known them for forty (40) years, might 9 be friends, more than friendly, and they might be friends. 10 11 (BRIEF PAUSE) 12 13 Q: This article goes a little further up with 14 reporters saying: 15 "I am a frustrated would-be politician." 16 Do you see that? Under the -- the title 17 would-be politician, you go down about twenty (20) lines. 18 A: What page is this now? 19 Q: We're still at Tab -- 20 A: Oh, 6 too? 21 Q: Yes, we're still at -- 22 A: I -- I've said that before. Without even 23 looking, I know I've said that. 24 Q: Right and that's about eleven (11) or 25 twelve (12) lines down, Mr. Lyons.

1 "I am a frustrated would-be politician. 2 I --" 3 A: Oh, I see it. 4 Q: And then it makes a -- it makes a -- the 5 journalist makes and statements this -- Mr. Livesey: 6 "Lyons has a remarkable talent for raising 7 money for -- for politicians." 8 Do you agree with that statement, that you do 9 have a remarkable talent for raising money for politicians? 10 A: I think -- it's just that I like 11 fundraising. I do it for so many different causes that 12 anytime I'm working on three (3) or four (4) clauses. To 13 give you a list today what I'm working on -- 14 Q: No, that's all right. 15 A: So it's not necessarily -- my talent is 16 fundraising, not necessarily for politicians as part of it 17 but give me a good cause and I'll get involved. I enjoy it. 18 Q: The fundraising, I appreciate, you enjoy 19 but that's fundraising -- fundraising is part of the lobbying 20 business as well? 21 A: Oh, yes. 22 Q: All right. This talent that you have for 23 fundraising, your career began in 1976 when you became active 24 in Joe Clark's run for Conservative leadership? 25 A: I guess --

1 Q: That statement -- 2 A: No, I was active before that with -- in 3 politics. I was one of the youth leaders but I guess if 4 you're saying fundraising, that might have been the first 5 time. 6 Q: All right. 7 A: I mean, I was probably a young kid when I 8 was first involved. 9 Q: And then you -- you, according to this 10 article during the 1979 federal election, you helped raise 11 nearly $1 million for the Tories from Toronto's business 12 community. Would that be correct? 13 A: I was involved with a group that did, yes 14 but it wasn't totally me. 15 Q: I appreciate that. Now, we talked about 16 your -- your career as a -- as a lawyer, the involvement of 17 rainmaking in there and in that context as well, fundraising. 18 Let's talk about you as a lobbyist. When do you say that you 19 actually considered yourself a lobbyist? 20 A: It was a gradual evolution and I never 21 really got into this as a full time business probably until 22 -- oh, I -- I guess around maybe when the provincial 23 Conservatives got elected, I started to really move into it. 24 So -- 25 Q: What's the year?

28
  1                 A:  That's the '95.
  2                 Q:  Would you have considered yourself a
  3  lobbyist in 1995 then?
  4                 A:  Part time.  Not full time.
  5                 Q:  Would you have held yourself out as or
  6  promoted yourself as a lobbyist at that time?
  7                 A:  To some -- t -- yes.
  8                 Q:  All right.  Now, you presently, under the
  9  name Lyons Group, have a website and I'm going to take you to
 10  that in a moment but I -- before I do, I just would like to
 11  know from you in your own words, rather than the website's
 12  words, what it is that you do as a lobbyist for a living?
 13                 A:  Well, I'm a -- I'm a consultant.  I'm a
 14  problem solver.  I strategize.  I arrange -- I have -- I
 15  arrange meetings and provide intelligence and I think that's
 16  it.
 17                 Q:  The -- this would be all in relation to
 18  the government, provincial, municipal levels?  That would be
 19  the context in which you solved problems, solved --
 20  strategized, arranged meetings, gather intelligence?
 21                 A:  Sometimes I do it for private -- I always
 22  have a certain percentage of private sector clients, who
 23  really are looking to do business with other private sector
 24  companies.
 25                 But, generally, most of that would apply -- I

1 mean I also, that's government relations which you're 2 referencing, though. 3 Q: But, a lobbyist is somebody that 4 represents clients in relation to the government and -- 5 A: You know you could be lobbying other 6 companies -- 7 Q: -- is it all in that context? 8 A: You could also lobby other companies, I've 9 done that. I mean, anyways, but, generally it's perceived to 10 be with politics and I agree with you, on that. 11 Q: All right. 12 A: Just indicating that sometimes I do it 13 with private sector. 14 Q: But, whether or not, that is considered 15 lobbying the lion's share of what you do, is in relation to 16 the provincial and municipal levels of government? 17 A: Yes. 18 Q: And at the municipal levels of government, 19 it would be primarily if not exclusively, City of Toronto? 20 A: Primarily, the City of Toronto, yes. 21 Q: All right. If you can turn to your Volume 22 2, that's the thin one (1) -- there's a thick one (1) and a 23 thick one (1), Mr. Lyons, this is the thin one (1). 24 A: Okay. 25

1 (BRIEF PAUSE) 2 3 Q: And go to Tab 1 and none of these have 4 been scanned into our data bank, so I'll just refer to these 5 by Volume number and Tab number -- 6 A: Okay. 7 Q: -- and the number of pages in. Now, this 8 is -- you just have a look through this, we just have 9 accessed your website and downloaded it. 10 Would you look through that and tell me if 11 that's your -- 12 A: Yes, that's my website. 13 Q: All right. Now, the Lyons Group, 14 according to -- according to this, I'm at the first page, Mr. 15 Lyons. 16 A: Hmm hmm. 17 Q: According to this, the Lyons Group was 18 created in 2000? That would be right? 19 A: Maybe it was. I was thinking 2001, but, 20 maybe it's 2000, I could be wrong with dates. 21 Q: All right. I guess the point -- the point 22 is, that assuming that it's created in 2000, this website is 23 right, it would have been created at some point, after you 24 left Morrison Brown and Sosnovitch? 25 A: That's right.

1 Q: All right. And you left there in 2000? 2 A: It might have been 2000. And I'm -- you 3 know what, I'm confusing, I think 2001 -- okay. 4 Q: All right. Well, unless we hear 5 otherwise, you adopt what you have on your website here? 6 A: I do. 7 Q: All right. Prior to 2000, you conducted 8 your lobbying business in the context of being Counsel to 9 Morrison Brown and Sosnovitch, correct? 10 A: Yes. 11 Q: All right. And then after 2000, you 12 created -- and after leaving Morrison Brown and Sosnovitch, 13 as their Counsel, you created the Lyons Group, the website 14 and so on and so forth? 15 A: Yes. 16 Q: Now, the Lyons Group, is a government 17 relations firm, serving a wide variety of clients, on both 18 the municipal and provincial levels? 19 A: Right. 20 Q: All right. This -- it doesn't say 21 anything about a private sector really, but, basically 22 promotes the Lyons Group, as a government relations firm? 23 A: Yes. 24 Q: At the municipal and provincial levels? 25 A: Yes.

1 Q: All right. And this next paragraph states 2 in effect, that your clients benefits from extensive 3 knowledge and expertise in policies, procurement, legislation 4 and regulation? I'm still on that first page. 5 A: Oh, you're on the first page? 6 Q: It's on the first page. 7 A: Okay. 8 MADAM COMMISSIONER: It's the last paragraph, 9 Mr. Lyons. 10 THE WITNESS: Yes, yes. I -- it says that. 11 12 CONTINUED BY MR. RONALD MANES: 13 Q: That would be right? 14 A: Hmm hmm. Yes. 15 Q: All right. Now, this talks about -- in 16 the next sentence: 17 "Expertise gained from a combination of 18 forty (40) years experience." 19 I take it that's in -- in combination with you 20 and other people in the Lyons Group? 21 A: Yes. 22 Q: You have experience and extensive 23 knowledge in policy, procurement, legislation and regulation. 24 Would that be accurate? 25 A: Me, myself.

1 Q: Yes. 2 A: You're talking about now? 3 Q: Yeah. 4 A: I would have some understanding, yes. 5 Q: When you say you would have some 6 understanding, would you be expert in -- if you go -- go to 7 the next page here, the second paragraph: 8 "An expert in navigating issues and 9 concerns through the often labyrinth 10 channels of government." 11 Is that something that you would feel 12 comfortable in saying that you are an expert in? 13 A: Yes, because it's a -- you know, after 14 being involved with government for years, you sort of have a 15 sense of how to navigate. 16 Q: And if you then go to the -- 17 18 (BRIEF PAUSE) 19 20 Q: I just have to count these pages here. If 21 you go to the -- four (4) pages from the -- from the back is 22 the best way that I can do this. 23 A: Okay. 24 MADAM COMMISSIONER: What does it say on the 25 top, Mr. Manes?

1 MR. RONALD MANES: Well, it says -- the way 2 these are numbered. 3 MADAM COMMISSIONER: Well -- 4 MR. RONALD MANES: The way these are numbered, 5 it says 1 of 1, so it never -- 6 MADAM COMMISSIONER: Okay. 7 MR. RONALD MANES: It's -- actually, I've 8 numbered the pages. Page -- 9 MADAM COMMISSIONER: The one on the side that 10 says "Provincial Services and Municipal Services"? 11 MR. RONALD MANES: Yes. 12 MADAM COMMISSIONER: Okay, thank you. 13 14 CONTINUED BY MR. RONALD MANES: 15 Q: And we're looking at actually what "Lyons 16 Group services, municipal services". Do you see -- see where 17 I am -- 18 A: Yes. 19 Q: -- for that? 20 A: Yes. 21 Q: All right and this describes what it is 22 you do and -- and -- and your -- and the Lyons Group does in 23 relation to municipal services? 24 A: That's correct. 25 Q: Do you want to take a moment and just read

1 that over? 2 A: Yes, I've just been reading it. Yes. 3 Q: Now, you -- you state in the first 4 paragraph that: 5 "When dealing with any municipal 6 government, it is important to read the 7 political landscape correctly." 8 A: Correct, yes. 9 Q: And you go on to say: 10 MADAM COMMISSIONER: Are you asking him, Mr. 11 Manes, whether he agrees that that's on his website or 12 whether he agrees with what is contained there? 13 14 CONTINUED BY MR. RONALD MANES: 15 Q: Whether you agree with what that is 16 contained -- what is contained there, that in dealing with 17 any municipal government, it's important to -- for the client 18 to -- to read the political landscape correctly? 19 A: Yes, I agree with that. 20 Q: And the next paragraph: 21 "From introduction at the committee level 22 to working with City Council, as a whole 23 Lyons Group directs its clients through the 24 every -- through every step of the 25 municipal procedure -- procedural process."

1 A: Yes. 2 Q: Do you agree -- 3 A: I agree with that. 4 Q: -- with that? 5 A: I agree with -- well, that's -- that's 6 right. 7 Q: All right. Monitoring services, research, 8 background information, all relevant to committees, agencies, 9 boards, commissions -- 10 A: That's right. 11 Q: -- Council meetings. You do all that? 12 A: Yes. 13 Q: And then skip a paragraph. 14 "The Lyons Group knowledge -- our knowledge 15 of both the political and bureaucratic 16 levels of government equip our clients with 17 the resources to gain the fullest exposure 18 and fairest consideration. Our team is 19 familiar with the workings of Council and 20 staff offices, enabling Lyons group to 21 fully prepare you and your firm no matter 22 what obstacles lie ahead." 23 A: Yes. 24 Q: All right. You do that. Let -- let's 25 then just go back so that you can help us understand the full

1 import of what you say here, in relation to your services to 2 municipalities and in particular, the City of Toronto. 3 I take it when someone has an interest in 4 doing business -- a client has an interest in doing business 5 with the City of Toronto, it would be important for them to, 6 as you say, to read the political landscape correctly? 7 A: Yes. 8 Q: Now, how is it that you do that? I mean, 9 how is it that you assist a client, in reading the political 10 landscape correctly? 11 A: Well, of course, the issues are various 12 and myriad, so I'd probably have to deal with an example. Do 13 you have -- 14 Q: All right. 15 A: I mean -- 16 Q: Well, let's take DFS. 17 A: Yes. 18 Q: Come to you, we'll flesh that out a little 19 bit more later, come to you and they want to do business with 20 the City -- 21 A: Hmm hmm. 22 Q: -- in this context, 1999 leasing RFQ and 23 you're going to advise them about the political landscape, 24 correct? 25 A: Correct.

1 Q: All right. So, what do you do? 2 A: Well, first of all, they'd tell me what 3 they're selling or what they want to sell. And then I would 4 be saying, in that case, since they were into leasing, does 5 the City, first of all, is the City interested in doing 6 leasing, that's the first question, which was the issue. 7 And then I'd say, your problem is, not 8 necessarily winning this bid, you better convince the City 9 that they're interested in leasing. 10 So, that would be a reading of the political 11 landscape. You know, they'd just be assuming they're going 12 in to win a bid, and I'd be saying, hold on a second, I'm not 13 sure that they're even interested. 14 Q: Let's stop there. Because that's very 15 helpful. You -- at that meeting, would have made that 16 observation, I take it, that better find out whether the City 17 is interested in leasing, because you had some sense that 18 they may not necessarily be interested in leasing? 19 A: Absolutely. 20 Q: Now, how would you know that? We're 21 talking about leasing IT here. But, how would you know that 22 the City would not necessarily be interested in leasing IT? 23 A: Probably wouldn't have known that until 24 they retained me. I don't do a lot of work until I'm 25 retained, as you can appreciate. And I would probably then

1 start snooping around a bit or somebody would, to find out, 2 what's the City doing about leasing -- what's this -- 3 hardware, I guess. 4 And I'd be finding out, well, they don't 5 lease, they buy. They're not really interested in leasing, 6 at all. So, then I'd be saying to the client, you've got a 7 problem here. You got to back up a bit. 8 Q: All right. Let me just stop there. Just 9 -- because you needed a specific example, DFS, and whether 10 the City was interested or not, in leasing. 11 You had and have several clients in the IT 12 business? 13 A: I do or I did? 14 Q: You did at that time, I believe? 15 A: Yes. 16 Q: All right. And wouldn't you have gotten 17 some understanding of the City's interest in IT and in 18 particular, leasing IT, just gathering intelligence from, 19 let's say, the IT department and your relationship there? 20 A: It's possible, but, you know, if you're 21 not focussed on the issue -- I have a great sense of when 22 nothing involves me, I don't want to listen. I have got 23 enough to do without listening to every story. 24 Q: You're a need to know, kind of guy? 25 A: I'm on a need to know. If they're talking

1 about something else, my mind is not into it. 2 Q: Well, to read the political landscape 3 correctly, as you put it here, in the website. You would 4 normally, as you say, snoop around, does that mean that you 5 would pick up the telephone or -- 6 A: Yes. 7 Q: -- or go see people that you have 8 relationships with? 9 A: Yes. 10 Q: All right. And you'd say, so, I've got 11 this client interested in leasing -- selling leasing services 12 to City of Toronto, think they're interested? Something to 13 that effect? 14 A: Yes. 15 Q: Now, this talks about not only the 16 political but also -- also the bureaucratic level, I take it 17 that you are going to get -- you're going to snoop around at 18 both the political and the bureaucratic level to get the 19 information you need, intelligence. 20 A: Right. 21 Q: G -- would you recall, again a specific 22 case at DFS, whether you would have spoken with Jim Andrew, 23 for example? He was the Executive Director of IT. 24 A: He would be one of the sources that I 25 would have phoned, not necessarily him.

1 Q: All right. I appreciate that but he -- 2 that -- that was a person that you had dealt with in respect 3 to other clients? 4 A: Right. 5 Q: All right. He was well known to you, at 6 least in a professional context? 7 A: Yes. 8 Q: All right and would you -- in gathering 9 your intelligence, would you have spoken to any politicians 10 in terms of reading this political landscape correctly? 11 A: Probably not on that issue because you'd 12 probably be checking with the staff if they're interested in 13 doing something like that. You know, leasing. 14 Q: Politicians, though -- Councillors in this 15 -- in this context. Councillors are the ones that ultimately 16 make the decisions? 17 A: Yes. 18 Q: Now, I -- I appreciate that -- that it's 19 very relevant what staff thinks, but Councillors often make 20 -- ultimately make those decisions, correct? 21 A: Yes, but -- yes. 22 Q: They -- they take recommendations -- City 23 Council takes recommendations from -- from committees. 24 Councillors populate committees? 25 A: Committees take recommendations from

1 staff. 2 Q: Correct. So you start -- you sort of nose 3 around with the staff and get an idea of the -- of the 4 bureaucratic landscape, really, in terms of that attitude 5 towards leasing? 6 A: Yes. 7 Q: And do -- does that lead to speaking with 8 any politicians? For example, if a particular politician 9 would be relevant to the information gathering process, would 10 you speak with that politician as well, just to get their 11 opinion on it? 12 A: Not at that point. 13 Q: Well, let's take, again using that DFS 14 example as just a general example of how you go about this. 15 You would have known that Mr. Jakobek was -- was the budget 16 chief? 17 A: Yes. 18 Q: Budget chief is a powerful position at the 19 City of Toronto? 20 A: Yes. 21 Q: And this particular budget chief, Mr. 22 Jakobek, he was -- he had -- as a priority, he would know 23 about keeping the -- the budget at a zero (0) level? 24 A: Yes. 25 Q: And he was a person who seemed to have his

1 finger on every financial impact on the City? 2 A: Well, he was an involved budget chief; 3 that was known. 4 Q: He would be a person, when it came whether 5 to buy or to lease that, obviously, would be -- would be a 6 budget consideration? 7 A: Yes. No, later that became apparent 8 but -- 9 Q: Hmm hmm. 10 A: -- I thought you were asking me from the 11 beginning. 12 Q: All right. That -- later that became 13 apparent but at the beginning you would start at the 14 bureaucratic level? That's what you're -- 15 A: Right. 16 Q: -- what you're saying? All right but you 17 would have quickly found out starting at this bureaucratic 18 level that leasing may have been a consideration for one 19 reason at the IT level but it was a different consideration 20 at the financial level? 21 A: That's true. 22 Q: So Mr. Andrew -- let's just take -- 23 continue on this situation. Would -- your discussion with 24 Mr. Andrew or would there have been talks about using words 25 like refresh and replace and rollout?

1 MR. TODD WHITE: Well, I take it Madam 2 Commissioner, we're still in the hypothetical? 3 MR. RONALD MANES: We're not. 4 MADAM COMMISSIONER: I'm not sure. Mr. Manes? 5 MR. RONALD MANES: Well, when I say would 6 there have been, I'm not -- I'm not in the hypothetical here. 7 MADAM COMMISSIONER: Okay. 8 MR. RONALD MANES: Would there have been -- 9 MR. TODD WHITE: You prefaced that question 10 that he spoke to Jim Andrews and I think the evidence was, 11 you know, hypothetically I don't -- he didn't say that he was 12 -- he spoken to Jim Andrews when he got retained. 13 MR. RONALD MANES: Well -- 14 MADAM COMMISSIONER: Well, I guess Mr. Manes, 15 one (1) of the difficulties we have of using an example, that 16 Mr. Lyons called for, which turns out to be a real example, 17 is that in trying to get a sense of what Mr. Lyons would do 18 for a client, in this particular case, you're asking him not 19 only what would he do, but, what did he do. 20 Have I got that right? 21 MR. RONALD MANES: Yes, I'll rephrase the 22 question. 23 MADAM COMMISSIONER: Okay. 24 25 CONTINUED BY MR. RONALD MANES:

1 Q: In this particular case, did you speak 2 with Mr. Andrew, about the bureaucratic landscape? 3 A: No. I'm not -- well, let me put it this 4 way. I don't know who I spoke to, so I'm saying, no, because 5 I don't remember speaking to him. 6 But, I did speak to somebody to find out what 7 the position of the City. But, it could have been even in 8 the finance department. I'm not sure where I got the 9 information. 10 Q: When you conduct this intelligence, and 11 I'll go out of this specific example of DFS. When you 12 conduct intelligence gathering, is that the kind of -- you 13 reduce it to writing and put it in a file? 14 A: No. 15 Q: Keep it in your head? 16 A: Sometimes, sometimes I might jot down a 17 note. But, some piece of information, such as this would 18 just be in my head. I wouldn't -- you won't forget that when 19 somebody says to you, we're not leasing, you'd say, that's a 20 big problem. You'd remember. 21 Q: And then you would gather this information 22 from a bureaucratic level, then if necessary, from a 23 political level and advise your client, what the landscape 24 looks like? 25 A: Right.

1 Q: Right, what the challenges are that they 2 have to overcome, for example? 3 A: Yes. 4 Q: And you'd advise your client what in your 5 view, would be the best way to go about achieving their 6 objectives? 7 A: Right. 8 Q: All right. The -- in terms of what 9 lobbyists do, there is a definition that the City of Toronto 10 has and I want to ask you your reaction to it. 11 12 (BRIEF PAUSE) 13 14 Q: If you go to your second Volume -- 15 A: Hmm hmm. 16 Q: -- and this is Tab 33, at 40386. That's 17 the City of Toronto, conflict of interest guidelines, adopted 18 by City Council August 1, 2, 3, 4, 2000. 19 And if you go to 40404. And you see where it 20 says, appendix 2 -- 21 A: What page number again? 22 Q: 40404. 23 A: Oh, 404, okay. Appendix 2, yes. 24 Q: Now, this is conduct respecting lobbyists, 25 and let me read it for our record:

1 "Lobbying is usually defined as direct or 2 indirect efforts to solicit support and 3 influence government decisions on behalf of 4 another party or an organization, often 5 away from public scrutiny." 6 Now, let's just take that first paragraph. 7 Would you agree with that definition of lobbying? 8 A: Yes. 9 10 (BRIEF PAUSE) 11 12 Q: Now, in terms of soliciting support and 13 influence in government decisions, what do you, as a lobbyist 14 do to influence government decisions? 15 A: Well, what you're really doing is putting 16 forward the case on behalf of your client to the appropriate 17 people or bodies. 18 Q: These people would be decision makers or 19 influential staff, key staff? 20 A: Yes, both. 21 Q: And in terms of putting your case forward, 22 could you -- could you tell us generally how it is that you 23 put your case forward to key decision makers or -- or -- 24 well, let's just leave it at that, how you put your case 25 forward to key decision makers.

48
  1                 A:  Well, before you ever meet with that
  2  person, you really want to have your own case ready so you
  3  have to do some research to understand the issues that are
  4  pertinent to your -- to your client and pertinent to your
  5  argument and the next thing is getting him a fair hearing
  6  which would be for one of these people that you've described.
  7                 Q:  A fair hearing?  Does that mean an open
  8  hearing?
  9                 A:  No, that -- that they're willing to
 10  listen.  Some people just don't want to listen and you're
 11  hoping that they're actually listening to your argument and
 12  it will be weighed accordingly.
 13                 Q:  So, when I say an open hearing it is right
 14  what this definition says, often away from public scrutiny? 
 15  This fair hearing that you're talking about would be a or
 16  could be a private hearing?
 17                 A:  It could.  I mean, there's something
 18  insidious in that comment which I didn't say to you earlier
 19  but it's -- I don't care whether it's in the full glare of
 20  headlights.  If they want to hear it, it's an -- it's a --
 21  it's an argument.
 22                 Q:  You say that you don't care whether it's
 23  in the full glare of headlights?
 24                 A:  Some of these meetings, no.  It's --
 25

1 (BRIEF PAUSE) 2 3 A: Anyway, it's -- 4 Q: Well, the -- 5 A: It's just -- 6 Q: -- well, the only reason -- 7 A: I'm not opposing that statement, I'm just 8 saying that that happens most of the time and I agree with 9 you. 10 Q: That it's away from -- often away from 11 public scrutiny? 12 A: Right. So -- 13 Q: The only reason I -- I paused when you 14 said you didn't care if it was in the full glare of public 15 headlights was that I'm about to take you to a law suit you 16 commenced against the City in which you objected to the -- 17 the lobbying bylaw. 18 A: Yes and I'm glad you asked that. 19 Q: All right. Now, we'll -- we'll come to 20 that. 21 A: Okay. 22 23 (BRIEF PAUSE) 24 25 Q: Well, in fact, I think we should come to

1 -- go -- go to it right now because it's probably easiest and 2 we'll come back to your website at this -- some -- but I do 3 want to ask you about it. Am I right that Council passed 4 lobbyist disclosure rules or lob -- and a lobbyist disclosure 5 policy in around March of 2001 that affected your business? 6 A: Yes. 7 Q: And that -- those lobbying disclosure 8 rules and lobbying disclosure policy basically required a 9 lobbyist to -- or I'm sorry, a bidder in a -- in a major 10 procurement to disclose lobbyist contacts with people at the 11 City on their behalf, correct? 12 A: Yeah, this -- well, you're talking about 13 the -- the subject matter of the action I brought? 14 Q: Yes. 15 A: Yes. 16 Q: Right. 17 A: But it -- but it asked more specifically 18 to record every date and time and who the person was that you 19 spoke to. 20 Q: All right but you, as -- as I appreciate 21 your legal action, that you did not want to disclose the 22 contact that you as a lobbyist had with people in the City 23 with respect to a procurement and you went to Court, to stop 24 that? 25 A: Well, Mr. Manes, let me explain. I think

1 it's very important and the main things that I do with 2 respect to representing my clients is that they have a level 3 playing field. 4 And when that level playing field doesn't 5 exist and my client is in jeopardy. So, as a result, this 6 particular bylaw had a chilling effect, on the ability of my 7 clients to be able to communicate with decision makers. 8 It didn't have a -- so -- what happened is, 9 the staff would be able to present their position and maybe 10 we don't agree with it and no one would want to talk to my 11 client, because they have to record the time and date, and 12 they were fearful of it. 13 And I -- 14 Q: Okay -- 15 A: -- I will oppose anything at anytime which 16 I think takes away a level playing field. 17 Q: All right. Well let's talk about that, 18 because I know that we here, Commissioner, need to understand 19 why you say that there would not be a level playing field, if 20 you had disclosed the contacts and communications, as a 21 lobbyist that you had, in a procurement matter on behalf of 22 clients. 23 I thought that you had said that you didn't -- 24 didn't matter to you whether the fair hearing that you had, 25 as you put it, was in the glare of public headlights.

1 Are you saying that that is not the case, when 2 it comes to this lobbyist disclosure policy at the City? 3 A: Well, we -- the reason I say, public 4 glare, is because most of the times, when you are submitting 5 on behalf of your clients, is not what people usually think 6 as lobbying, where you meet with somebody down a dark alley. 7 You're really just making a submission to a 8 committee or a body. So I'm saying, do I have a problem with 9 that? No. 10 Q: I'm talking about the fact, that you 11 objected to revealing -- in principle, to revealing your 12 contact with individuals at the City, whether they be 13 comprised of committees or whether they be -- 14 A: Because these people -- 15 Q: -- Councillors or bureaucrats. 16 A: Because these people didn't want to be 17 part of the process. So, what we're trying to do now is tell 18 the staff that they have to record it -- or they do have to 19 record it, so they wouldn't talk to you. 20 And obviously you want public scrutiny, but, 21 at the same time, this chilling effect, was detrimental to my 22 client. And I'm -- or to my potential clients. And I felt 23 -- also you were dealing with the other levels of government 24 which had your registration system, which I have no problem 25 with.

1 And I'm sure Madam Bellamy -- Justice Bellamy, 2 Your Honour, will ask me for my recommendation, I have no 3 problem with the registration system, for a lobbyist at the 4 provincial or federal level. 5 But, they couldn't do this because they need 6 the consent of the Province. So, they were imposing some 7 weird system that actually had a very chilling effect on the 8 ability to put my argument forward. 9 And so it meant I no longer could really talk 10 to anybody. I could certainly do the public presentations 11 and I guess -- I don't know if that answers your question -- 12 Q: Well, here's where I am puzzled. The -- 13 according to the City, as I understand the lobbyist 14 disclosure policy and rules, was that those who were enacted, 15 so that there would be a level playing field, so that people 16 or lobbyists could not appear to or seek preferential 17 treatment on behalf of one (1) bidder, that was not available 18 to other bidders. Isn't that fair? 19 A: Well, but, then you have another problem. 20 How do you get those interest groups who may be only 21 superficially interested, could be the issue over the Island 22 Airport, where they go and see Councillors, they lobby them, 23 they do everything, there's no reporting of their activities. 24 So, again, I didn't see this bylaw dealing 25 fairly. I'm only dealing with fairness. And I'm saying that

1 that bylaw was not fair. 2 Q: Well, in terms of the interest groups that 3 you're talking about, whether it's the Island Airport, or 4 otherwise, that is not the subject matter of the lobbyist 5 disclosure rules, as I understand it, as I understand it the 6 only thing -- 7 A: But -- but it should have been -- 8 Q: -- excuse me -- 9 A: Sorry. 10 Q: -- the only thing that it affects is major 11 procurement contracts, $2 to $2.5 million or more. Or 12 special high profile contracts. 13 Is that -- is that right, first of all, in 14 your -- 15 A: Yes -- 16 Q: -- your understanding? 17 A: -- that's right, you're absolutely right. 18 But the only thing I would say to you is that maybe your 19 procurement for certain -- like, you know, you see in the 20 papers now they're talking about waste and new technology, so 21 assume the City puts out a bid for $2.5 million and you're 22 subject to that. And these people go to staff or whatever 23 and they have to record the conversations, then you've got an 24 interest group that says, we don't want incineration or 25 something like that.

1 And we're going around and we lobby these 2 Councillors who say don't accept the bids, send them back and 3 there's another whole process going on for which no 4 accounting is taking place. 5 Q: That's -- well, let's talk about that 6 process for which no accounting is taking place in the 7 context of procurement and this particular lobbyist 8 disclosure rule enacted by Council in March 2001, that you 9 objected to. 10 In that particular -- in that -- in this 11 particular case, the level playing field that was the object 12 of the -- of the rule, related to the fairness, as you put 13 it, with which all bidders are treated; correct? That is it 14 was -- 15 A: Are you talking about this bylaw? 16 Q: -- just this bylaw in the context of -- of 17 the lobbyist -- 18 A: Yeah, all the bidders who would bid would 19 be subject to the same rules. 20 Q: That's right, and -- and if any of them 21 had a -- a contact with anyone at the City, they had to -- 22 the bidder would have to fill out the form that asks for the 23 contact, the date of the contact, and -- and generally, what 24 that contact was all about; correct? 25 A: Right.

1 Q: And -- and you or your lawsuit objected to 2 that disclosure? 3 A: Yes. For the reasons I gave you. 4 Q: I appreciate that. 5 A: It's not because we didn't want to 6 disclose, it was for the other reasons. 7 MADAM COMMISSIONER: Was it -- just to help 8 me, Mr. Lyons. Did they have to disclose if they spoke with 9 a Councillor as well? 10 THE WITNESS: I think that was the case. 11 MADAM COMMISSIONER: Okay. 12 THE WITNESS: Yes. 13 MADAM COMMISSIONER: Okay. 14 THE WITNESS: Yes. 15 MADAM COMMISSIONER: And this -- what's the 16 distinction between the interest groups and the individual 17 bidder? 18 THE WITNESS: Well, the bidders are bidding on 19 a contract, so you've got ABC Company, DEF Company and 20 they're bidding to -- let's take incineration as an example. 21 And it's more than the $2.5 million. So, 22 those particular people who are interested in getting 23 information or whatever this bylaw requires, they have to 24 record those conversations and the person they met. 25 Now, my submission's more what happens when

1 people don't want to talk -- don't want to meet with them, 2 because they don't want their name involved, because then 3 there's so much paranoia around, which does exist, as you're 4 probably aware. 5 But then you've got an interest group who says 6 we don't want that incineration in the City, we're going to 7 fight it, and I know that staff -- this Council who approved 8 it and we're going to go around lobbying all these 9 Councillors and we're going to get them just to refute -- 10 refuse the staff recommendation. 11 And so after all this expense and time and 12 everybody putting their bids forward, some other group's in 13 there with certain Councillors who support them. And I'm not 14 going to get into who and what, because that has no point 15 here. 16 And I'm saying, what do we do about these 17 groups, like I'm always very puzzled how much influence the 18 City of Toronto is by interest groups. 19 And it's -- I don't see it -- I know people 20 will say you see that at other levels of Government. I've 21 never seen the amount of -- of -- of strength that they seem 22 to have in dealing with -- with issues at the City of 23 Toronto. 24 And I think to a large extent the City seems 25 to be guided by interest groups, as opposed to business

1 interests and that's just a comment. 2 MADAM COMMISSIONER: Okay. 3 4 CONTINUED BY MR. RONALD MANES: 5 Q: Are you saying that this lobbyist 6 disclosure policy should have been more broader, more 7 comprehensive and gone beyond procurement to any or defined 8 issues that Council was voting on, such as a political issue 9 like incineration? 10 A: Well, if you're going to get into it, I 11 think, frankly, registration is a better answer, because 12 that's what they're doing at all levels. 13 I think it's wrong to have a -- a more 14 draconian bylaw than you do at another level. I just think 15 all three (3) levels of Government should speak the same way. 16 But if you're going to do it, do it properly. 17 Q: And do -- do it properly, meaning that -- 18 A: You'd better take into consideration 19 everybody that can influence a decision. And lobbyists may 20 be lobbyists in the terms of somebody hired to represent a 21 company, but you certainly do have other interest groups who 22 have more power than lobbyists, because they control votes, 23 or workers or whatever they provide to these -- these 24 decision makers, that's of real concern to me, or to my 25 clients, not to me, but to my clients.

1 Q: So, you're saying that in certain -- on 2 certain issues, like incineration that the -- the interest 3 groups at the City of Toronto have more power than the 4 clients for whom you lobby? 5 A: That would be my -- not that particular 6 issues, that's just my general opinion. 7 Q: All right, but in terms -- in terms of 8 that -- 9 A: Well, you remember the Adams Mine as an 10 example, look how strong the interest groups were there, did 11 that bylaw ever prohibit those interest groups, or the -- not 12 the bylaw the proposal to do -- 13 Q: Well, if -- 14 A: -- to do the Adams Mine. I mean I'm just 15 giving you another example. 16 Q: Right, just assuming that -- that you're 17 right, and there is an uneven playing field -- 18 A: Hmm hmm. 19 Q: -- and what you're saying is that 20 lobbyists registration or registry, and if it defines, and to 21 include interest groups is there to make it -- 22 A: Yes. 23 Q: -- an even playing field. 24 A: I agree with the idea of -- well, I've 25 said that I guess so --

1 Q: All right. 2 A: -- I'm just repeating myself. 3 Q: And that would -- 4 MADAM COMMISSIONER: And just so you know, Mr. 5 -- I don't mind and this is actually helpful to me, so if you 6 have something that you can help me with on this, as you know 7 at the end, I will be asking you if you -- 8 THE WITNESS: Yes, I'm just -- 9 MADAM COMMISSIONER: -- but if it comes -- 10 THE WITNESS: -- giving you -- 11 MADAM COMMISSIONER: -- at this stage, as 12 opposed to the end, I'm happy to hear it at any time. 13 THE WITNESS: Well, I'm giving you a flavour 14 of what exists out there. 15 MADAM COMMISSIONER: All right. 16 THE WITNESS: And I -- you know, at the time 17 all the lobbyists agreed with me, but no one wanted to spend 18 any money on the lawsuit, so I was stuck myself taking this, 19 and -- and I -- anyway, that's what happened. 20 21 CONTINUED BY MR. RONALD MANES: 22 Q: Right. If the object of registration is 23 to ensure a level playing field, and you agree that that is 24 the -- the -- what the object should be to achieve, that is a 25 level playing field between lobbyists and interest groups;

1 correct? 2 A: Right. 3 MR. TODD WHITE: Your Honour, I'm going to 4 object at -- at the relevance of this. It's fine at the end 5 of the day to ask Mr. Lyons for his opinion, if he so chooses 6 to give one, but I don't see how being -- you know, debating 7 the issue or being cross-examined on the issue is -- is 8 really fair, in the circumstances, so -- and it's certainly 9 going to take a lot of time if we allow Mr. Manes to debate 10 the issues. That's what it seems to me that it's turning 11 into. 12 And it may well be at the end of the day that 13 Mr. Lyons is going to be asked about his opinion and his 14 view, but I don't see how that's really relevant to the Terms 15 of Reference that we have, that they relate to Mr. Lyons. 16 MADAM COMMISSIONER: Well, it's helpful to me, 17 actually, in terms of what I'm going to have to do 18 eventually, and I could be wrong. But I got the impression 19 from what Mr. Lyons said, that he actually wanted to talk 20 about the lawsuit in any event. 21 But even if he doesn't, and I don't want to 22 put Mr. Lyons on the spot of having to say anything about 23 this, but it is actually helpful to me, because at the end of 24 the day if you look at my Terms of Reference, I do have to 25 make some recommendations in this area, okay.

1 MR. TODD WHITE: I understand that, but he's 2 now being cross-examined on it. And I think that's unfair. 3 MADAM COMMISSIONER: Oh gosh, I think that's 4 quite unfair, Mr. White. There's nothing in what I heard Mr. 5 Manes say, that even sounded remotely like a cross- 6 examination. And in fairness, even if it was, which I say it 7 wasn't, he's entitled to under our rules, in any event. 8 But, Mr. Lyons, if you have any difficulty 9 with the questions, you just let me -- 10 THE WITNESS: No, the only comment I was going 11 to make, and I certainly have -- I'm not -- I'm only sitting 12 here as a witness, is that I've said what I've had to say -- 13 MADAM COMMISSIONER: Yes. 14 THE WITNESS: -- I've had my say. 15 MADAM COMMISSIONER: All right. 16 MR. RONALD MANES: All right. 17 18 CONTINUED BY MR. RONALD MANES: 19 Q: What I -- I don't understand is if you 20 agree that there should be a level playing field when it 21 comes to -- as between lobbyist and interest groups, where is 22 the -- isn't that equally as desirable in the lobbyist 23 disclosure rules in respect to procurement that there be a 24 level playing field amongst all bidders? 25 A: You're talking about the present bylaw?

1 Q: Yes. 2 A: Well, I told you my thoughts about that. 3 I really have nothing more to add. 4 Q: Well, I guess that -- what I -- I just 5 don't understand and want you to help me with, why is it an 6 unlevel playing field when all bidders equally have to 7 disclose all contacts they have with -- with City employees 8 or Councillors? 9 A: Well, I gave -- I said it all already. I 10 told you there was a chilling effect that you have to 11 consider and that's why I suspect the other levels did their 12 registration system. I -- I don't really know Mr. Manes. 13 This is my sense of it. I can just tell you want the result 14 is and the other part is what we -- I mentioned, the special 15 interest groups. There's no regulation of them in this and 16 since -- 17 MADAM COMMISSIONER: M -- 18 THE WITNESS: -- a lot of issues are so -- 19 sorry. 20 MADAM COMMISSIONER: No, go ahead. Go ahead. 21 I'll ask after. 22 THE WITNESS: -- are social interest issues. 23 I -- I mean, I can't really help you more than that. 24 MADAM COMMISSIONER: Did you find it had a 25 chilling effect with respect to the staff of the City?

1 THE WITNESS: Yes. I mean, I've heard that 2 from them. They -- they've said to me, you know, well don't 3 record -- you know, they -- I've heard that said by other 4 people. They don't even want it recorded. You know, and the 5 clash is well, you have to record it so then they don't 6 really want to talk to you. 7 So it's -- no, there hasn't been many examples 8 because this is only a $2.5 million procurement bid. So 9 there'd be an answer -- Council probably hasn't existed more 10 than what? A couple of times, I think. I don't know. 11 Nobody's from the City here, but -- 12 13 CONTINUED BY MR. RONALD MANES: 14 Q: If it existed at the time of the 1999 15 lease -- City of Toronto leasing RFQ, then all of the bidders 16 would have been required to disclose all the contacts they 17 had with Councillors and -- and -- 18 A: That's true. 19 Q: -- key decision makers? Correct? 20 A: That's true. That's true. 21 Q: Now, you had said that other lobbyists 22 supported you in this but you were the only one that went 23 forward and added -- well, went forward with the law suit? 24 A: Yeah, but none of them will admit that. 25 Q: Oh.

1 A: I'm just telling you what I gleaned in 2 phone calls but d -- you know, they're always after you al 3 font. 4 Q: I appreciate that. If you can go to Tab 5 22, I want you to -- I want to talk about one of these 6 Councillors -- one of these lobbyists. Volume 2. 7 A: Hmm hmm. 8 Q: Tab 22. This is a Toronto Star article 9 dated Wednesday, June 6th, 2001. Mr. Jack Lakey, City Hall 10 Bureau -- 11 A: Hmm hmm. 12 Q: -- and this has -- this is an interview 13 with you and Bruce Davis, another lobbyist, with respect to 14 the -- the lobbyist disclosure rules. Are you -- do you 15 recall this -- this article? 16 A: Yes. 17 Q: All right. Now, in that article you, at 18 the end of the first page, you say and I quote: 19 "'It's an unlevel playing field,' Lyons, a 20 lawyer, said yesterday. 'If you represent 21 the public, you don't have the right to 22 present your views. You have to register, 23 record every conversation, every meeting.'" 24 And then you go on to say at the next 25 paragraph:

66
  1                   "So there's really a barrier to speaking to
  2                   these people.  To me freedom of expression
  3                   is one of our charter rights."
  4                 And then you go on to say something about the
  5  -- the --
  6                 A:  Registration.
  7                 Q:  -- the pop -- the registration power.
  8                   "I'm saying you don't have the power to do
  9                   it.  You've never been able to have a
 10                   registration system and now you're trying
 11                   to do something even more draconian and
 12                   heavy-handed than a registry system."
 13                 Those are all --
 14                 A:  That's true.
 15                 Q:  -- accurate quotes?  All right.  If you
 16  can go back to the first quote.  When you say it's an unlevel
 17  playing field, you go on to say:
 18                   "If you represent the public, you don't
 19                   have the right to present your view.  You
 20                   have to register, record every
 21                   conversation, every meeting."
 22                 First of all, as a lobbyist do you represent
 23  the public, or do you represent private sector?
 24                 A:  Well, let me explain --
 25                 Q:  With the public --

1 A: -- let me explain something. You actually 2 brought up a good point. 3 What I also I wanted to say and since the 4 Commissioner is taking -- do I call you the Commissioner or 5 do I call you -- 6 MADAM COMMISSIONER: Yes, that's what they 7 call me here. 8 THE WITNESS: Your Holiness or -- 9 MADAM COMMISSIONER: I'm not going to touch 10 that one (1). 11 THE WITNESS: Okay. They haven't had one (1) 12 yet, a female one (1) yet? 13 MADAM COMMISSIONER: A Commissioner? 14 THE WITNESS: A pope -- a female pope. 15 MADAM COMMISSIONER: Well, I think there was 16 Pope Joan a very long, long time ago. 17 THE WITNESS: Anyway, I'm glad you asked this 18 question, because the other issue was, is that the staff, and 19 that's why I mean the public, if you're not able to 20 communicate with certain people, Councillors or staff, and 21 the point of view that you want to present, whether for your 22 bidder, but, you wouldn't be allowed to do it, because of 23 this chilling effect. 24 But, conversely the staff can parade into 25 Councillor's office, as an example, lobby them on A, B or C,

1 bidder, you've seen some of those issues in the newspaper, 2 and the bidder himself or herself, itself, doesn't have that 3 ability. 4 So, there's another flaw in that system. So, 5 are you going to make each staff member record their 6 conversation when they're a staff person? Maybe that's what 7 you really have to do to be fair. 8 9 CONTINUED BY MR. RONALD MANES: 10 Q: So, your concern is that, in effect, staff 11 may be lobbying against your client? 12 A: Oh, I've had that happen. 13 Q: And you don't have a chance, on behalf of 14 your client, to respond since that lobbying is done in 15 secret? 16 A: Sure, yes. 17 Q: But, would you objected to, of course, 18 here is that if the staff can lobby in secret, then you ought 19 to be able to lobby in secret, are we at the bottom line 20 here? 21 A: Well, what's sauce for the goose is sauce 22 for the gander. 23 Q: All right. We're at the bottom line. Let 24 me take you to the next page. 25

1 (BRIEF PAUSE) 2 3 A: Yes, go ahead. 4 Q: Just in respect to other lobbyists, since 5 you brought this up, this next paragraph says the following, 6 in respect to Mr. Bruce Davis, and he's a lobbyist? 7 A: Yes. 8 Q: Urban Intelligence? 9 A: Yes. 10 Q: Influential lobbying firm? 11 A: Yes. 12 Q: "Not all lobbyists have a problem with 13 the rules. Bruce Davis, the main lobbyist 14 at City Hall after Lyons, said he help 15 craft the rules and has no problem working 16 within them. Quote, 'We fully support the 17 lobbyist disclosure rules', Davis said. 18 Quote, 'I spoke in favour of it last year. 19 I appeared before (City Council's 20 Administrative Committee) last year and 21 said, I thought it was appropriate. I mean 22 what's the problem. So, you have to fill 23 out a form. It doesn't prevent you from 24 doing a job.'." 25 Take that last paragraph. What's the problem,

1 Mr. Lyons, it doesn't prevent you from doing your job, just 2 to fill out that form and disclose your contacts? 3 A: So the rhetorical question and I'm not 4 trying to be cute here. Do you really believe everything you 5 see written in a newspaper? 6 I have spoken to Mr. Davis about this issue 7 and I'm not going to say anything further. 8 Q: Well, it is true, is it not that Mr. 9 Davis, did speak in favour of the lobbyist disclosure rules 10 last year, in an appearance before the City Council's 11 Administrative Committee? 12 A: I'm just going to refer you -- yes -- 13 Q: That's true? 14 A: True -- can I refer you to the last 15 sentence? 16 "It doesn't prevent you from doing your 17 job." 18 You can -- that can be interpreted many ways. 19 That's all I have to say. 20 Q: In any event, this is one (1) lobbyist -- 21 A: Right -- 22 Q: -- that was not supportive of your 23 lawsuit? 24 A: Right. Well, I won't answer that -- I 25 don't agree with that.

1 MADAM COMMISSIONER: Mr. Manes, is this a good 2 time for our break? 3 MR. RONALD MANES: Yes. 4 5 (BRIEF PAUSE) 6 7 MADAM COMMISSIONER: Just so you know, Mr. 8 Lyons, I'm not sure if anyone has told you this, but, very 9 early on I directed the media not to speak to witnesses while 10 they are testifying. 11 They could speak to you after, if you want, 12 but -- 13 THE WITNESS: Yes -- 14 MADAM COMMISSIONER: -- not during the time 15 that you're testifying. 16 THE WITNESS: Okay. Thank you. 17 All right. Thank you. 18 REGISTRAR: Order. The Inquiry will recess 19 until 10 to 12:00. 20 21 --- Upon recessing at 11:30 a.m. 22 --- Upon resuming at 11:50 a.m. 23 24 THE REGISTRAR: The Inquiry will resume, 25 please be seated.

1 (BRIEF PAUSE) 2 3 MADAM COMMISSIONER: Yes, Mr. Manes...? 4 MR. RONALD MANES: Thank you, Commissioner. 5 6 CONTINUED BY MR. RONALD MANES: 7 Q: Mr. Lyons, could you go to Volume 2 -- 8 A: Hmm hmm. 9 Q: -- Volume 1, sorry, that's the thick one. 10 A: Hmm hmm. 11 Q: And to Tab 25, which is 52353. 12 13 (BRIEF PAUSE) 14 15 Q: Now, this is just the -- the facing sheet 16 of your -- of your -- are you there? 17 A: Right. 18 Q: This is the -- the facing sheet of your -- 19 your lawsuit, entitled Application Records. So, it's your 20 application to the Court, as I recall, to quash, as they call 21 it, or to eliminate the City of Toronto lobbyists -- lobbying 22 policy; correct? 23 A: Yes. 24 Q: And then if you go to 26, Tab 26. 25 A: Hmm hmm.

1 Q: That's an index at 52355, of the 2 Proceedings, and it's -- it simply consists of the notice and 3 what the grounds are for seeking to eliminate the -- the 4 policy, and your affidavit in support of that; do you see 5 that? 6 A: Yes. 7 Q: All right. Now, if you go to -- this is 8 commenced at -- if you see 52357, March the 4th, 2001. So, 9 this was -- this policy was enacted, in effect, in March and 10 you bring this -- this application to Court in May of 2001. 11 A: Yes. 12 Q: And then if you go to page 3. 13 A: Right. 14 Q: And that is -- I should give you the 15 Begdoc number and not refer to these pages, 52358, Mr. Lyons? 16 A: Yes. 17 Q: Now, this is the reasons you're making 18 this application, and it goes into the grounds for the 19 application; do you see that? 20 A: Yes. 21 Q: The -- and it starts as number 1: 22 "The applicant is a barrister, solicitor 23 and lobbyist, he deals with the City and 24 its representatives." 25 Do you see that?

1 MADAM COMMISSIONER: I'm sorry, Mr. Manes, I 2 don't see it, what page are you at? 3 MR. RONALD MANES: 52358, Commissioner. 4 MADAM COMMISSIONER: Yes, I'm there. 5 MR. RONALD MANES: And right at the bottom, 6 the grounds for the -- 7 MADAM COMMISSIONER: Oh, at the bottom. 8 MR. RONALD MANES: -- application. 9 MADAM COMMISSIONER: Thanks. Yes. 10 11 CONTINUED BY MR. RONALD MANES: 12 Q: Now, then you bring this application as 13 both of you -- as your status as a barrister and solicitor 14 and as a lobbyist? 15 A: That's what my counsel put, yes. 16 Q: Well, all right, we'll -- we'll go to that 17 in a second. If you go to 52366. 18 A: 66, right. Hmm hmm. 19 Q: This says: 20 "The resolution purports to regulate the 21 conduct of barristers and solicitors, over 22 which the City has no authority." 23 Paragraph 27. 24 So, I take it what -- what you're saying is 25 that according to what your solicitor put down here, your

1 status as a barrister and solicitor was relevant to the 2 extent that the resolution tried to regulate your conduct as 3 a -- as a lawyer, and the City had no authority over that, 4 that's what the -- at least the lawyer put down there? 5 A: Yes. 6 Q: All right. Now, then would you go to your 7 -- your affidavit -- 8 A: Hmm hmm. 9 Q: -- and that is 52369. 10 A: Hmm hmm. 11 Q: And -- and this affidavit was sworn by you 12 May the 3rd, 2001, do you see that right under affidavit of 13 Jeffrey Lyons? 14 A: Yes. 15 Q: Right, you also by the way, just if you 16 want to double check, that's also at 52372. 17 A: Yes. Yes. 18 Q: All right, so -- and it says: 19 "I, Jeffrey S. Lyons QC, of the City of 20 Toronto, Make oath and say as follows:" 21 And there's paragraph 1: 22 "I am a barrister and solicitor, having 23 practised law in the Province of Ontario 24 since on or about 1966. In my capacity as 25 such, from time to time I also act as a

1 lobbyist on behalf of clients and deal 2 directly with the City of Toronto." 3 And then you go on to the next paragraph and 4 say: 5 "Accordingly, I have an interest in City of 6 Toronto Bylaw 462000." 7 And then go into the policy dealing with 8 lobbying activities. 9 Now, my question to you is this, in this 10 application that you made to the Court, you say that in your 11 capacity as a barrister and solicitor you also act as a 12 lobbyist. And I'm wondering whether that is accurate? Do 13 you act in your capacity as a barrister and solicitor, do you 14 act as a lobbyist in your capacity as a barrister and 15 solicitor, because I thought you said that where DFS was 16 concerned, for example, you were not and haven't -- you were 17 not acting as a barrister and solicitor, and haven't 18 practised law since around 1995? 19 A: Well, to answer your question is that I 20 remember at the time we did this, I'm -- I'm still a 21 barrister and solicitor, and what he said, we might as well 22 put that in too, because obviously how can they regulate 23 lawyers, as an example. 24 But he actually says here: 25 "In my capacity from time to time, I also

1 act as a lobbyist on behalf of clients and 2 deal directly with the City of Toronto." 3 Which is really what I was at the time. 4 Q: Well, as I understand it, there's nothing 5 in the bylaw, nothing in the City's policy dealing with 6 lobbying activity that states anything about regulating 7 lawyers; am I right in that? 8 A: No, but I think -- 9 Q: I'm sorry, am I right -- 10 A: -- I'll take -- 11 Q: -- am I right in that? 12 A: -- you're right in saying it's -- I can't 13 recall, but I'll take your word. 14 Q: All right. And then you were going to say 15 something, Mr. Lyons? 16 A: Now, I can't remember what I was going to 17 say, so -- 18 Q: Well -- 19 MADAM COMMISSIONER: He said there was nothing 20 in the bylaw that says anything about regulating lawyers, and 21 that was the last question that he had had. And before that 22 you were talking about from time to time -- 23 THE WITNESS: I think this was my counsel 24 thought that it was a good idea to put in I was a barrister 25 and solicitor, just to show that this bylaw wasn't perfect,

1 and how it would deal with lawyers. So, I said fine. But I 2 -- my dealings were as a lobbyist, I think that's what he's 3 saying there. 4 5 CONTINUED BY MR. RONALD MANES: 6 Q: Well, just the way it was worded, in my 7 capacity as such from time to time, when he had said in your 8 capacity as such, that's as a barrister and solicitor, from 9 time to time I also act as a lobbyist, what you're saying 10 here is you, when you're acting as a lobbyist, you're acting 11 as a lobbyist and not as a -- as a lawyer. 12 A: Right. 13 Q: Right. All right and your interest in 14 this bylaw and the regulation of lobbyist activities was as a 15 lobbyist, not as a lawyer? 16 A: That's correct. 17 Q: All right. 18 19 (BRIEF PAUSE) 20 21 Q: The -- the judge heard all of the 22 submissions by your lawyer and submissions by the City's 23 lawyers and ultimately rendered a decision? 24 A: Yes. 25 Q: All right and now, we have that decision

1 and that is at Volume 1 at Tab 30. 2 A: Yes. 3 Q: Now -- 4 MADAM COMMISSIONER: Can I have the Begdoc 5 number, please. 6 MR. RONALD MANES: Yes, 52513, Commissioner. 7 MADAM COMMISSIONER: Thank you. 8 MR. RONALD MANES: And that's a decision of 9 Judge Coo, C-O-O. 10 11 12 CONTINUED BY MR. RONALD MANES: 13 Q: Now, Judge Coo dismissed your application 14 and awarded costs against you were in favour of the City? 15 A: That's correct. 16 Q: All right and that's dated October 2nd, 17 2001. You see that at 2514 at the bottom left hand corner of 18 the page. 19 MADAM COMMISSIONER: Did you say December? 20 MR. RONALD MANES: October 2nd -- 21 THE WITNESS: 2nd. 22 MR. RONALD MANES: -- 2001. 23 THE WITNESS: -- 2001. That's correct. 24 25 CONTINUED BY MR. RONALD MANES:

1 Q: It maybe be helpful to the -- to the 2 Commission and to understanding your position and the -- at 3 least the judge's response in relation to understanding this 4 bylaw and procurement procedures as it affects lobbyists. 5 Now, this is the first paragraph and it -- the 6 judge talks about the contractual disclosure requirement on 7 bidders for $2 to $2.5 million and larger contracts. He goes 8 on to talk about the policy has been in -- been in place 9 pursuant to the bylaw. Quote: 10 "To establish procedures and authorities 11 for the procurement of goods and services." 12 And then goes on to say this: 13 "What is required is that bidders disclose 14 the fact of any representations made by or 15 on their behalf which promote the bids or 16 opposes those of another to City staff or 17 City Councillors. It is not required by 18 the form in use or by the language of the 19 policy that there be revelations of the 20 content of the representations but just 21 that it or they occurred. Such 22 representations are not limited or in any 23 way controlled but they must be reported or 24 the bidder risks losing the right to bid in 25 the future for a period of one (1) year

1 from the time of non-disclosure. In my 2 view, what might be done in the future by 3 way of business resolution or practice is 4 not an issue." 5 Now, let's just stay with that paragraph for a 6 moment. You accept the fact, I take it, that all you were 7 required to do as a lobbyist is to disclose the fact of the 8 contact -- contact and not the actual representations or the 9 content of the representations that were made? 10 A: Yes. 11 Q: In other words, what this judge is saying 12 is that all you have to say -- disclose as a lobbyist is that 13 -- or the bidder has to disclose is that my lobbyist made a 14 contact with this particular person on this particular date? 15 A: Yes. 16 Q: Now, am I right in saying that your 17 position was that that isn't fair or a level playing field, 18 because the City staff doesn't have to do the same thing? 19 A: That was one (1) of the reasons. 20 21 (BRIEF PAUSE) 22 23 Q: Does the fact that City staff represents 24 the public, as opposed to the lobbyist who represents private 25 interests affect your conclusion as to who has the

82
  1  responsibility to disclose contacts with City employees or
  2  Councillors?
  3                 A:  Can you ask that question again?  I'm
  4  sorry.
  5                 Q:  Do you accept that City staff, are hired
  6  to and do represent the public interest?
  7                 A:  Yes, absolutely, they're supposed to do.
  8                 Q:  All right.  And that lobbyists represent
  9  private interests, that don't necessarily have to coincide
 10  with public interest?
 11                 A:  That's true.
 12                 Q:  And that when you as a lobbyist go to the
 13  City, or City staff, you go there to advance your clients'
 14  interests?
 15                 A:  Yes.
 16                 Q:  All right.  And when the City staff makes
 17  contact with other City staff or Councillors, presumably they
 18  represent the public's interest?
 19                 A:  In a perfect world, yes.
 20                 Q:  And how is this world that City staff at
 21  City of Toronto, is living in not a perfect world, in that
 22  regard?
 23                 A:  Well, there's also influences over staff. 
 24  It could be of any form, their view of the issue, their view
 25  of the company, so that you might find that they're not

83
  1  objective.
  2                 And I guess what you're concerned is to make
  3  sure that they're totally objective and what you want is to
  4  make sure that the decision maker has all the information
  5  available to him.
  6                 So, if they're not objective, then they have
  7  the information that hopefully will level the playing field.
  8                 Q:  The -- in terms of being objective, do you
  9  need feel that approaches by lobbyists in secret to influence
 10  a particular City staff, may affect their objectivity or at
 11  least the perception of their objectivity?
 12                 A:  Well, you say secret, but, in any event,
 13  putting aside that word, I find sometimes they find it very
 14  helpful, that's my experience.
 15                 Q:  Helpful in terms of the information which
 16  you communicate?
 17                 A:  Right.
 18                 Q:  But, the point here, is not whether it's
 19  helpful to them, it's simply the matter of disclosing that
 20  you've made such contact, and that's what you object to and
 21  what I am asking you, is whether that contact, not in the
 22  glare of public lights, but, in fact, in private may actually
 23  or perceptively affect a particular staff or Councillor's
 24  independence?
 25                 A:  Well, if that's the bylaw, I can live with

1 that. The question is, is it fair? 2 Q: Well, I appreciate that, then I guess the 3 answer is the same, that the fact of having to disclose this 4 contact is unfair, because the City staff doesn't have to 5 disclose their contact with one (1) another or with 6 Councillors? 7 A: And the special interest groups in certain 8 issues and then the other question is, whether the staff want 9 to be under the light of talking to you, if they have to 10 record it. 11 Q: So, are you saying that the, chilling 12 effect, you're talking about is that the staff will be less 13 likely to speak with you, if the fact of that contact has to 14 be reported by the lobbyist? 15 A: Right. And a person like myself, who obey 16 the bylaw and do that, others may not and so I'm concerned 17 about that. 18 Q: I see. If you go to the next page, and 19 that is 52514, the Judge, in this paragraph, and I'll 20 paraphrase, it has some Latin -- French in it, but I'll 21 paraphrase it. I do not believe that there is any sign of 22 bad faith or any attempt to do something improper outside the 23 scope of routine business activities, controlled as part of a 24 sensible, relevant and apposite guidelines or policy. 25 Now, I take it you disagree with that, insofar

1 as you don't think it's fair that this policy is not 2 sensible? 3 A: I'm not -- 4 MR. TODD WHITE: Your Honour, I think it's 5 unfair to have a witness comment on a judgment. It's like 6 commenting on law. I think it's inappropriate. 7 MR. RONALD MANES: It's -- 8 MADAM COMMISSIONER: How is Mr. Lyons supposed 9 to comment on that, Mr. Manes? 10 MR. RONALD MANES: Well, if -- if Mr. Lyons, 11 Commissioner, thinks that it is not sensible for -- for the 12 reasons that he's given, I've just asked him whether he 13 agreed or disagreed with that? 14 MADAM COMMISSIONER: Well, I guess the 15 difficulty is when you put to him a whole paragraph of a 16 Judge's endorsement, it puts him in a difficult position of 17 having to say publicly whether he agrees or disagrees with 18 the Judge. 19 In this case presumably he disagrees, given 20 that he lost the application before the Judge. But I wonder 21 if there's a way that you can still get what it is that 22 you're trying to get, without putting Mr. Lyons in the 23 position of having to respond and address it in that 24 particular way. 25 MR. RONALD MANES: All right.

1 (BRIEF PAUSE) 2 3 CONTINUED BY MR. RONALD MANES: 4 Q: You said before that you were concerned 5 about the chilling effect that this would have on the 6 lobbyist's ability to deal with staff, that is staff would be 7 unwilling to talk if the -- if the fact of the contract were 8 -- had to be reported; correct? 9 A: Yes. 10 11 (BRIEF PAUSE) 12 13 Q: Is it your position and was it your 14 position before this Judge, through your lawyer, that as a 15 result of that chilling effect, contacts would not occur? 16 A: Yes. 17 Q: And now the Judge rejects that in 18 paragraph 6, and my question to you is that have you in fact 19 found that to be the case, that City staff are turning away 20 lobbyists and -- and you, in particular, because of this 21 policy? That is they won't talk to you? 22 A: I can't recall -- I don't recall if I've 23 been involved since, but that comments been made to me. But 24 more than once. 25 Q: By other lobbyists is it?

1 A: By other -- by lobbyists and staff. 2 3 (BRIEF PAUSE) 4 5 MR. RONALD MANES: If I just might have a 6 moment, Commissioner. 7 8 (BRIEF PAUSE) 9 10 CONTINUED BY MR. RONALD MANES: 11 Q: In terms of your business, sir, if you can 12 just turn to Tab 22 of Volume 2. 13 A: Hmm hmm. 14 15 (BRIEF PAUSE) 16 17 A: Hmm hmm, two (2) did you say? 18 Q: Yes, at Tab 2 -- I mean Volume 2, Mr. 19 Lyons, at Tab 22. 20 A: Oh, Tab 22? 21 Q: Yes. That's that Lakey article again, 22 June 6th, 2001 and the interview about the -- about your 23 lawsuit. 24 A: Hmm hmm. 25 Q: And if you just go about seven paragraphs

1 down -- paragraph down where it says, he says -- 2 A: Unlevel playing fields, you mean? 3 Q: No. 4 A: Page 2? 5 Q: Page 2. Paragraph 7. 6 A: One (1) -- two (2) -- three (3) -- he says 7 -- yeah. 8 Q: Let me just read it to you: 9 "He says the new rules haven't had any 10 major effect on his business, quote, 'But 11 the point is it's there. I feel very 12 strongly that you do what you have to do to 13 protect you and your client's interest.'" 14 First of all, is that quote accurate? 15 A: Well, it hadn't had any major effect 16 because I wasn't doing anything. It was a procurement bylaw 17 so at that point it wasn't affecting my clients. 18 Q: And are you saying now that it