Mtis National Council loses bid to regain temporary control of veterans program money

The Mtis National Council's bid to regain temporary control of millions of dollars of disputed assets held by a former ally sputtered Thursday before a Ontario Superior Court judge in Toronto.

The Mtis National Council fileda multimillion-dollar lawsuit last year, accusing former leaders and the Manitoba Mtis Federation of wide-ranging financial improprieties.

The two groups appeared virtually Thursday as the MNCsoughtjoint custody, until trial, of $8.65 million in federal cash for a Mtis veterans program, plus return of a history database, which it accuses its former administration of divertingto the federation to harm the council and benefit themselves.

Justice Robert Centabegan the hearing by grilling MNC's lawyer, Robert Cohen, of Toronto-based law firm Cassels.

"How is this in the interest of the Mtis people? Is a single Mtis person going to be better off if I grant you this interim relief?" Centa asked.

"Giving joint custody and control to two parties that can't agree on anything sure feels like a recipe for disrupting the operation of that program and the operation of that website."

Cohen tried to convince Centa that alleged conflicts of interest and non-arm's-length dealing, which the MMF denies, justified it.

Allowing the MMF to retain control of the assets "is rewarding a clear violation of their obligations," said Cohen, but the judge was unconvinced.

"You say clear violation. You might succeed at trial. You might not. You haven't proven anything yet," Centa replied, beforeadding, "You're seeking extraordinary relief. This is execution before judgment in its clearest sense."

Negotiations urged

Instead, Centa urged the lawyers to negotiate a solution that wouldn't disrupt the website or program.

The lawyers eventually agreed, broadly, on an order requiring MMF to preserve the database in the original form transferred and produce more files so the MNC can satisfy itself nothing is amiss financially.The lawyers were working on drafting the final order at time of publishing.

MMF's lawyer Rahool Agarwal said theywanted to ensure the order was worded carefully.

"We have nothing to hide but do we want to hand over every scrap of paper for all period of time? That's incredibly onerous, but we will respond to any request," Agarwal said.

That means the bulk of the motion was dismissed and MMFPresident David Chartrandconsidered it avictory in round one.

"Mr. Cohen was vigorously put in his place by the judge," Chartrand said by phone.

Chartrand said the MMF spent seven months preparing for the motion, so he was surprised it was handled so swiftly that the federation'slawyer didn't even have to make formal arguments. MMF sought $213,000 in costs, Chartrand said, but the judge declined to settle that issue.

Chartrandsaid he is now equally confident about his prospect of success at trial, describing the MNC's arguments as "a political assassination attempt"riddled with inaccuracies.

While not getting joint custody of the veterans money, its chief target, MNC said via statement it is satisfied with the order.

"MNC was not expecting to prove its case today,"said the statement, attributed to legal counsel.

"We are pleased to obtain this interim relief, and we will push on to trial as soon as we can."

No trial date set

Chartrand's MMF cut ties with the MNC in 2021 following years of internal squabbling over the integrity of the Mtis Nation of Ontario's citizenship registry.

Before the secession, Chartrand was also MNC vice-president and minister of finance, while Clem Chartier, now an ambassador with the MMF, was MNCpresident.

The MNC sued Chartrand, Chartier, the MMF and a host of others in January 2022, accusing them of conspiring in a "scorched earth policy scheme" to gut the council and give MMF a political edge.Chartrand defended against the allegations, calling thema legally baseless, vendetta-driven fishing expedition.

Thursday's virtual hearing offered both sides a chance to test their case. They filed more than 1,600 pages of evidence combined.

In 2019, the federal government providedthe national council with $30 million to run aprogram for $20,000 individual recognition payments to Mtis Second World War veterans or their family members, or commemorative initiatives in their honour. Between 2020 and 2021, $8.65 million was transferred to the MMF.

MNC said in its filings it believed veterans money was "misused," violating the federal contribution agreement.

The group's external accountant, Benoit Groulx of Baker Tilly in Ottawa, swore an affidavit saying he believed there were questions raised by the MMF's books.

Groulx produced MMF financial files showing it gave contracts to affiliated parties, including a foundation chaired by Chartier, and employed Chartrand's wife while managing the program.

The MMF said no money was misused. Chartrand said the contracts were awarded fairly by an arm's-length program commission, and that his wife's hiring was handled transparently.

Given the competing versions of events, Centa said these are precisely theissuestrial shoulddecide.

No date for trial has been set.