Canadian Lawyer

12 M A R C H 2 0 1 7 w w w . C A N A D I A N L a w y e r m a g . c o m "freedom of thought, belief, opinion and expression . . . ." But when she tried to take legal action against the AER, it cited its immunity under s. 43 of the act. The Alberta Court of Appeal found that s. 43 did indeed grant the AER immunity from a Charter challenge, so Ernst appealed the matter to the Supreme Court. There the justices divided 4:1:4. Four of the justices found: "It is plain and obvious that s. 43 (of Alberta's Energy Resources Conservation Act) on its face bar's Ernst's claim for Charter damages…." Four of the justices, including Chief Jus- tice Beverley McLachlin, totally disagreed, finding that: "It cannot be said that it is plain and obvious that Ernst cannot estab- lish a breach of s. 2(b) of the Charter." That left Justice Abella, who found that the lack of "proper notice and a full evi- dentiary record" precluded the court from considering a constitutional argument. The ultimate result was the defeat of Ernst's claim. For Klippenstein, the Supreme Court result lacked clarity. "It's noteworthy that the court took a year to release its deci- sion . . . one reason may have been the difficulty in trying to reach a consensus. I don't think this is a blanket approval of a Charter-free zone for government officials or government regulators. What the court decided is by no means clear; maybe someone else will have to bring it back to the Supreme Court." Understandably, AER spokesman Bob Curran did not have similar reservations. He found the result encouraging, and not just for the Alberta Energy Regulator. "[It's] important for all regulators because it affects our ability to conduct business." University of Calgary law professor Shaun Fluker, who has blogged on the case, shares the view that it is unfortunate the Supreme Court was so split on the issue. He believes the issue of whether statutory immunity clauses insulate against Charter challenges is a question worthy of consideration. "The ultimate result," he says, "is this particular issue has been left for another day." While the lawyers and the law pro- fessors were disappointed in "a missed opportunity," Ernst was fighting mad. Just days after the Supreme Court decision, she sent a withering, three-page letter to McLachlin. In the letter she says, "it stuns me" that Justice Abella wrote in her judg- ment that the AER's predecessor board "made the decision to stop communicat- ing with Ernst, in essence finding her to be a vexatious litigant. . . . " In her letter, Ernst pointed out that, "to this day, the regulator has never filed a motion in any court accusing me of being a 'vexatious litigant.' None of the defendants in my case have." She calls the remarks damaging and has demanded that "Justice Abella's state- ments be retracted or corrected." — GEOFF ELLWAND \ AT L A N T I C \ C E N T R A L \ P R A I R I E S \ W E S T REGIONAL WRAP-UP A Law Society of B.C. review panel decision gave no relief to former Van- couver tax lawyer Robert Strother, under a five-month suspension since February 2015, following a professional misconduct hearing involving a tax shelters deal that ignited 15 years of court wrangles and LSBC hearings and involved $32 million in profit taking. Strother requested a review of the LSBC hearing panel's decision, claiming the panel considered only extracts from trial transcripts while he wanted the whole transcript entered as evidence so panel members could better weigh it. The review panel found that the hearing panel's decision about the trial documents created a "fair and open process in all of the applicable circumstances" and that Strother had ample opportunity to put forward his views and any evidence at the hearing that might relate to the extracts used. Section 47(4) of the Legal Profession Act allows new evidence to be tendered under special circumstances. "In the application before us, we find that there was no special circumstance that compel or allow us to hear evidence that is not part of the record," the panel ruled, dismissing Strother's application. The hearing panel's findings led to a disciplinary hearing and action imposed on Strother. Strother's case spans almost two decades. As a partner and tax lawyer at Davis & Co., Strother represented Monarch Entertainment Corp. (later known as 346920 Can- ada Inc.), which offered film industry tax shelters between 1993 and 1997. It was his largest billing account. The federal government in 1997 closed off the shelters; Strother told Monarch he saw no way to continue. Monarch began winding down its business except for ongoing obligations. Its written retainer agreement with Davis & Co., stating the firm would act for no competitors, lapsed on Dec. 31, 1997. Strother continued to act for Monarch, which had an unwritten retainer agreement with the law firm. The company looked to Strother in late 1997 for new ideas, but then both parties decided to wait until 1998 to explore them. Monarch's former CFO Paul Darc, laid off in 1997, approached Strother in 1998 wanting to start an accounting business for the film industry. And he had an idea for a tax shelter — but it required an advance favourable ruling from Revenue Canada. Strother claims he didn't think the idea would fly, but he claimed he was "jollying" Darc along in a bid to gain a part of the new accounting service. On Jan. 30, 1998, Strother (not as a Davis partner) and the CFO started incorporation of Sentinel Hill Ventures and set out to get the needed tax ruling. If successfully obtained, Strother would acquire 50 per cent of the company. On March 3, 1998, Strother sent a letter from Davis & Co. asking for a ruling from Revenue Canada. On June 23, 1998, Davis & Co. signed a written retainer agreement with Sentinel setting out a percentage earning on shelter subscriptions sold. Revenue Canada provided a favourable ruling in October 1998. Throughout 1998, Strother met with Monarch and acted for the company, but he did not divulge his involvement with FORMER TAX LAWYER STROTHER CAN'T REOPEN DISCIPLINE DECISION Alberta anti-fracker still fighting despite Supreme Court loss Continued from page 11

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