Joe Groia
on the Bre-X case, civility and incivility, Law Society, and control of the narrative
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You're about to enjoy a great conversation. When I came here from the former USSR decades ago, I had no idea I would be interviewing Beverley McLachlin, Marie Henein, and many other exceptional judges and lawyers. I didn't even know that I would be a lawyer. I was no one and no one knew me. For the last 12 years, I've been building a law practice and a name as a commercial litigator. I've served many great clients. In many ways, I modeled my work on the work of the exceptional litigators I interviewed on the show. I want to prove that even a solo litigator can deliver the quality of a top firm. With dedicated personal service, carefully designed and tested methods, and a dash of unique life experience.
Please consider me for your referrals. Thank you and enjoy the show. Well, welcome to yet another episode of The Yunusov Question. My wonderful, absolutely wonderful guest today is Joseph Groia, the preeminent securities litigator in this country. Hello, Joe.
Hello, Pulat. That's a very kind introduction. I certainly don't deserve it.
Well, let's find out. I have a lot of questions. I think you are such an interesting person. I always start with a little bit of a bio. I want to know where the person comes from, even about your parents. So Can you spend a little bit of time— you know, I don't think you're one of those people who spend a lot of time on their LinkedIn profile or Facebook page, right? So I don't think there is a lot of information about where you come from. Can you talk a little bit about where you were born, who your parents were, and how you ended up being the preeminent securities litigator in Canada?
Sure. I'll try and give you the 5-second sketch. So I was born and raised in Toronto, went to Brock Public School and Bloor Collegiate. My parents were both from Toronto. My dad was a bellman at the Royal York Hotel for 35 years. My mother worked for the post office, and I went to U of T for my undergrad and my law. I had a great good fortune of working for Bob Sharpe one summer as his research assistant, although in those days the library was not air-conditioned, and I got to read every case ever decided by the Federal Court or the Exchequer Court of Canada as my job. But Bob steered me to a, a wonderful firm that doesn't exist anymore.
It ended in the mid-'80s called McTaggart Potts, and I went to work for Ian Binnie and George Strathy in those days was Ian's junior. Bob still had an association with the firm. Arthur Stone was there. Joe Potts was there. There were some really wonderful litigators, and any good habits I have today, I like to think I got them learning from Ian, and I would suspect at some point this morning, I will talk a little bit about some of the things that he told me when I was starting. After a few years there, I went to McMillan Binch and got to work with Stan Fisher, Terry O'Sullivan, Larry Taman for a few years. But my real break was I went to Harvard Law School one summer, 1985, and there I met Ermanno Pascutto, who was the executive director of the Ontario Securities Commission, and he was looking for somebody that could come and help the commission become more aggressive in the litigation side of what they did.
So I went and joined the Commission 1985. I started as the Associate General Counsel who was responsible for litigation matters. I knew my whole life had changed when on my first day in the office, I, I go in, the desk is empty except for a file folder. I open up the file folder and there's a letter from John Robinette asking when the Commission is going to meet with him to talk about a particular case. So I went down the hall to Ermanno and I said, come on, you're kidding, right? And he said, no, no, we need somebody to deal with this case. So I went from being, you know, a 4th-year litigation lawyer at McMillan Binch down at the bottom of the totem pole to going and meeting at McCarthy's with Mr.
Robinette, who insisted on calling me Mr. Groia. So I was there for 5 years, became the head of enforcement, and did a lot of important cases that I was very lucky to have a chance to work on. Left there in 1990 after I got married, started a family, went to Heenan Blakey, which was just starting up in Toronto. Wonderful firm and wonderful people, and it's a firm that I am very sad to have seen the end of. It's been a great disappointment to me because I thought that was a firm that was different from a lot of the Seven Sisters. 2000, after I got hired by John Felderhof to represent him in Bre-X, I started my own firm, Groia and Company.
Today—
Sorry for interrupting you. Did you start your own firm because you got that big file?
Not entirely, but that certainly was part of it. Representing somebody like John in a community like Bay Street is very difficult. There was a story on the front page of the National Post when I took on John, telling everybody that I was now a pariah on Bay Street because I was representing Mr. Felderhof. And, you know, I have to say that is probably the best part of my professional life. And in many ways it's the worst part. So we can talk about each end of that spectrum. But, you know, Groia and Company has been in business now almost 25 years and we are still one of Canada's leading securities litigation groups, 10 lawyers. Practice on Bay Street, and I'm still working in the office every day, although today my family started a winery because of the Law Society.
We'll, I'm sure, talk about that. So I'm down at the winery today. It's hopefully gonna be a long weekend with lots of happy customers.
Are you at the winery today?
I am, yeah. This is my winery office, so.
That's great. So you do still have the Civility and Incivility line?
Oh yeah, yeah. Our top line is called Tenacity. Our second line is Civility and Incivility. That, that was not a source of amusement when I testified at the Law Society. Below that, we have a couple of wines called Rebel. And after the Supreme Court decided in my favor for one year only, we produced a wine called Exonerated. I wanted to call it Vindication, but there's actually a winery in BC that sells a red blend called Vindication. So I had to make do with Exoneration, but we've retired that name. And if, if we need another name, we'll have to come up with something else.
You're a true artist of wine. I really, I really like those lines.
You know, the wine business has got lots of similarities to the law business. I'd been a home winemaker for 25 years. I thought I knew a lot about making wine. And within a few months of starting a winery, I realized I knew almost nothing about making wine in a professional manner. And I feel the same way about the law business. I subscribe to Malcolm Gladwell's 10,000 Hours Theory. That,
right?
I look, I look back over my career and I've been trying cases now for 48 years and I still like trying cases and I still learn from my mistakes. So I think I think the wine business requires somebody who's been in it their whole life and with any luck I'll be in it for 25 years at the most.
You had a magnificent career. You mentioned your mistakes. We will talk about some, or at least allegations of some mistakes, a little bit later. But I want to talk more about how you took on John Felderhof's case. So John Felderhof was chief geologist of Bre-X Minerals, which announced discovery of a huge gold mine in Indonesia. And that caused a spike in the stock price. And then it turned out that the gold mine was, was a fraud, right? I think this is a fair summary of why the fight that lasted for most of your career started.
Yeah, no, my, my Bre-X life started in the winter of 1997 when I went to the Cayman Islands and met with John and his family, his wife Ingrid. By that— at that point, he only had U.S. lawyers because all hell was breaking loose, and it was pretty clear that Canada would have a significant role. And so the U.S. lawyers spoke to people they knew in Toronto and asked who would be the best person to represent John, and I think my name was at the top of the list. So I went down and met with John spent a couple of days with him. And of course, I knew from the newspapers, at least I knew a lot about what was happening at Busang and with Bre-X.
So John and I hit it off, and I agreed to represent him. I said, John, there's 3 conditions that you're going to have to satisfy for me to represent you. And he said, okay, what are they? I said, number 1, you're going to have to take a lie detector test. Because although lie detectors are not admissible in, in court except in rare circumstances, Pulat, they do have a significant bearing on the mindset of at least police agencies and, and often regulators. And I knew that if John was going to get out from the worst of the trouble that he had, we had to persuade At its peak, there were 13 different government agencies in 3 different countries investigating John.
And if we were going to get out from most of that problem, we were going to have to persuade them John was not aware of the fraud and didn't participate in the fraud and was in many ways a victim, although in a very different way than other Bre-X investors and people. So, so John agreed to do that. and I took him to Montreal. The best polygrapher in the, in the world in those days was in Montreal named John Gallianos. John took a lie detector test, and John Gallianos assured me that he had passed with flying colors, and John had no doubt that Mr. Felderhof wasn't involved in any of the criminal activity. And I didn't believe he had after spending a few days with him, but Certainly having a lie detector helped.
The second thing I said to John was that he couldn't lie to me about anything because this was going to be difficult enough that if I couldn't trust him to tell me the truth, the whole truth, and nothing but the truth, I didn't know that I'd be able to represent him as effectively as I needed to. And then thirdly, I said, John, you're going to have to pay my bills. This, these, this is going to be long and expensive. And John lived up to that part of the bargain until the middle of the trial when he went through an unhappy divorce and ran out of money. So the team and I got together and we decided even though we weren't going to get paid, we would finish the last part of the trial for free.
So we did that, and what, what's come to be known as Part 2 of the Bre-X case was done without getting paid. That cost me somewhere in the neighborhood of $3 million. And then of course the Law Society came along, and I'm sure we'll talk about the extension of the Bre-X case. John was acquitted in 2007, I was charged in 2009, and I was finally exonerated, I, I feel, by the Supreme Court in 2018. So it's a case that went for 21 years, and as I say, it's the best, the best of times and the worst of times for my career.
Did you win the Felderhof? First of all, for the audience, of course you won the Felderhof trial. It was a very hard-fought trial that consisted of two parts, and the reason for the interruption was that the Crown moved to remove the presiding judge for— on the basis of reasonable apprehension of bias, correct?
That's correct.
Okay.
Almost unprecedented. Yes. And they— I knew from people at the commission that the prosecutors had assured the senior management that they were going to win their motion and get rid of Mr. Justice Hryn in Mr. Felderhof's trial. And because part of their attack was focused on me, I had to go and hire Brian Greenspan to represent the portion of the case that related to my incivility. And I'll remember it like it was yesterday, because after I hired Brian, who's one of the finest criminal lawyers in Canada and also one of the nicest people you'll ever meet,
Yeah,
I remember going up to his office and Brian saying, well, Joe, I've got good news and bad news. I said, okay, what's that? He said, the good news is we're going to win this application. I have no doubt that they're not going to remove Justice Hryn. I said, well, that's, that's a good start, Brian. What's the bad news? And he said, the bad news is that it's going to be very hard on you. Because we are not going to defend your conduct. We're going to take the position your conduct is irrelevant, and we're going to let them say or do all the things that they're going to say and do about you, and we're not going to fight back.
And I said, well, Brian, you know, I understand that that's in John's best interest, and I have to do what's in John's best interest, but It's gonna be awful for me. And he said, yeah, it is gonna be awful for you. You're gonna take a bullet for your client in the vernacular. So I then said to Brian, well, what about the Law Society? I mean, aren't I gonna have to worry about them? Aren't they gonna look at this and come after me? And I remember it so vividly. He put up his hand, he said, ah, the Law Society, don't worry about them. They're, Nobody, they're not going to do anything. So when Brian later came and testified at my hearing, I was grateful, of course, that he did it.
But I have from time to time reminded him that his prediction about the Law Society didn't turn out to be the case. So, but you know, what you learn from that, Pulat, is about the importance of controlling the narrative. As a trial lawyer or as a lawyer representing clients in these cases, so much of it is based upon who gets to control the narrative. Because if you can control the, the battleground— Sun Tzu teaches us that most battles are won before they're even started. And I was never, even after the, the Supreme Court found in my favor, I was never able to dig out of the harsh allegation that my conduct was unprofessional and below the standard of civility.
And I've gone around the country for many years teaching a class about the, the case and, and the issues. And almost always a student at some point will say, well, Mr. Groia, where do we get to the part where you told the prosecutors to F off or you did something outrageous? And I said, well, unfortunately, you know, we don't get there. The worst thing that I apparently said was that the Commission's promises were not worth the transcript pages they were written on, and that somehow I was being sarcastic to call the Securities Commission the government when they were falsely trying to call themselves the Crown. And at the same time, Brian, in his testimony, said, you know, the worst thing anybody said was said by a Securities Commission prosecutor in front of Archie Campbell when he called me a bald-faced liar and compared me to a terrorist 2 months after 9/11, said I was like a guy who throws a bomb into a crowded bus station and runs away.
Now that prosecutor went on to become a judge. And there was never any criticism or discipline for the conduct of the prosecutors, even though Archie Campbell in his reasons said there was no monopoly on incivility. And of course, I went on to be 9 years as a, you know, as an accused person in a Law Society hearing, and I also went on to become a bencher in 2015 because I was tired of losing at the Law Society, and I wanted to see if the profession supported the, the fight that I was fighting.
You know, before we go and talk about the Law Society, I just wanted to, to ask you, because a lot of our viewers, most of our viewers are lawyers and litigators, I wanted to ask you a couple of technical questions about the Felderhof trial. If so, correct me if I'm wrong, but, but did the prosecution prove the offenses beyond reasonable doubt, and then you won the trial on the basis of the due diligence defense.
So the, the answer is, is mostly yes. John was acquitted. There were 8 counts against John, 4 counts of insider trading and 4 counts of authorizing, permitting, or acquiescing in the release by Bre-X of misleading press releases. The 4 counts of insider trading we won on the merits. They did not prove the offense. And John, it was alleged that John had traded not with knowledge of salting, but rather with knowledge about a title dispute. And that case just fell apart and the commission was not able to prove that John had undisclosed material information. The second 4 counts about press releases, you're right. The court found that Bre-X had put out misleading press releases.
They also found, over a strenuous argument that I made, that John had authorized, permitted, or acquiesced in those misleading press releases. But they then acquitted him on the basis that he successfully mounted a due diligence defense. So on the geology, the court made a finding in John's favor that he had run a world-class exploration site. and Bre-X had followed high industry standards in the way it did its business,
right? I'm really curious, just jumping back to when you took this file on, you said that you knew you would become, or you said that you became a pariah of the Bay Street. You were on Bay Street before you took this file on. You probably also knew when you were taking the file on that this is going to be a very, very hard fight. So what was going through your mind? Why did you take this file on? Why were you willing to part ways with Bay Street at the time?
Well, for, for really two fundamental reasons. One, because Bre-X, of course, is a case of a lifetime. The largest securities fraud, one of the largest mining frauds, an incredibly interesting high-profile case. It had political intrigue with Barrick It had all kinds of interesting aspects. Michael de Guzman allegedly jumping out of a helicopter, although I happen to believe he's alive and living somewhere in the Philippines. So it had everything you could look for in terms of a trial lawyer's ambition. But I also, secondly, had a very strong sense, even as a, as a young lawyer, that One of the main problems on Bay Street is that you're guilty until proven innocent. And I felt John deserved the best defense that we could mount for him in the most difficult of circumstances.
And, you know, it's, it's very sad, but John passed away a few years ago. And notwithstanding a stunning acquittal on the merits, he never could work again as a geologist. He could never get his career back. I tried several times to see if I could help him do something in the geology field, and that never happened. So he died, you know, basically penniless and living in a village outside of Manila, running a small variety store. So, you know, it's sad, Pulat, but the reality is that Canadian regulators know they are able just by charging people to destroy their careers. And there's a handful of people I've represented over the years who managed to come back as well or better than they had been before, but I've represented so many people who, even if they've been successful in winning the case, end up not getting their, their career back.
So I wanted John not only to win the case, because I felt as a person I believed was innocent, he deserved to win it, but I wanted him to win it in a way where, you know, he could go back to being as he had been, the Prospector of the Year at PDAC. I'll tell you a story not many people know, that after John's acquittal, I was invited to PDAC to give a talk. About the case. And I went down, there were a couple hundred people in the room, and I invited John from the Philippines. He couldn't afford to come, so I paid for him to come to Toronto. And we didn't publicize the fact that he had done that because we didn't know what the reaction would be.
And so after I gave my talk, somebody stands up and in a very harsh voice says something to the effect of, so where's Mr. Felderhof hiding now? And I thought, you know, that's, that's just such a typical response. And so I said, well, he's hiding 3 tables to your left. And there was a great commotion in the room, and John spent a couple hours after the talk talking to people. But, you know, even to this day The— there's an anecdotal view about the Bre-X case, which is, you know, John was guilty, he hired some extremely difficult lawyer who got him off because I bullied the prosecutors. And, you know, John is guilty as hell, but he just had a smart lawyer who got him acquitted.
Nothing could be further from the truth. Anybody who reads Peter Hryn's 650-page judgment will see John got acquitted on the merits. He deserved to be found not guilty.
You said that the Bre-X case was one of the largest securities frauds in the history of Canada. Do you think the subsequent cryptocurrency frauds dwarf that case today?
In total dollar value, yes. And I think total dollar value of cannabis as well. But Bre-X was a single company in a single stock,
right?
$6 billion market collapse. So I think none of the crypto companies or none of the cannabis companies by themselves is that big. But collectively, I think we haven't even begun to see the scope of the cryptocurrency scandal. But it's spread out amongst, you know, how many companies? Hundreds if not more.
Do you think the Securities Commission did everything that it could to prevent cryptocurrency scams?
That's a difficult question, but, you know, we have seen in our lifetime several bubbles— the tech bubble, the cannabis bubble, the cryptocurrency bubble. I don't think regulators in this country, or in the US for that matter, do as good a job as they should on the way up. I think the most effective way to stop market frauds from becoming scandals is to ensure that when you have that kind of rapid acceleration you need to put in circuit breakers. You need to be out there saying to investors, you know, is this really a good idea? You're giving, you're giving your money to strangers who are making it disappear into electronic wallets that you know nothing about.
Well, you just think about the whole business premise and you realize how crazy it is. And yet, of course, it only takes a few stories of, you know, I, I took $1,000 and turned it into $100,000, and investors pile in. You know, the— if I could ever make one meaningful change in the marketplace, it would be to focus on investor education and investor insight. You know, I represent a lot of people who've done a lot of really stupid investments, and by the time they come to me, they realize how dumb it was. But You know, Bre-X regrettably was a story filled with tragedy. There were at least half a dozen suicides that happened from people who had borrowed huge amounts of money to buy Bre-X stock and of course got wiped out.
I want to jump back to Bre-X and that trial, but now I want to talk about your consequences of that trial for you personally. So the Law Society, of course, started prosecution against you for professional misconduct arising from allegations of your about your conduct during the trial. And that lasted from 2000. So the first decision the first Law Society decision came out in 2013. But I assume that your trouble with the Law Society started earlier, right?
So in 2002, the Law Society wrote me a letter and told me I was under scrutiny, under surveillance. They were watching my conduct and did I want to put their investigation on hold? We were in the middle of the Bre-X trial. And so I didn't have much choice but to put the investigation on hold. So between 2002 and 2007, they had a watching brief. After the acquittal of John in June of 2007, I wrote the Law Society and said, let's deal with any concerns you have. And remarkably, they wrote me back and said, well, our concern is you've been convicted of professional misconduct by the Court of Appeal, and what do you have to say for yourself?
There have been findings made against you of professional misconduct. So I hired Earl Cherniak, a wonderful trial lawyer and a former bencher of the Law Society, and Earl and I both tried to persuade the Law Society that there had been no findings made against me by the courts. I was not a party to those offenses. We were unsuccessful in doing that. So in 2009, I was charged with professional misconduct. By the time I was charged, Pulat— they had not ordered the Bre-X transcripts. In fact, we found a memo where they talked about illegally borrowing them from the Court of Appeal office rather than pay the court reporter to buy the transcripts. Fortunately, I guess sanity prevailed and they ended up buying the transcripts after I'd been charged.
And it was clear that my charges were based on newspaper stories and comments of the judges in front of the Court of Appeal and Archie Campbell. So my first hearing and my first decision The Law Society actually said it was an abusive process for me to defend myself, that I had wasted everybody's time trying to show that I had not engaged in professional misconduct, and that I was found guilty on all accounts. I was given a 2-month suspension, and I was ordered to pay a couple hundred thousand dollars in costs. Now it's important for you to understand something else. There had only been a handful of incivility cases before mine. One of them was a lawyer by the name of Bruce Clark.
Mr. Clark was representing a group of Indigenous people. He got over-excited by what was happening, so he went into the Court of Appeal of British Columbia and tried to carry out a citizen's arrest of the three judges, claiming that they had engaged in genocide and treason. That obviously didn't go very well. He was charged by the Law Society, and at the end of the day, he was given a reprimand for that, a decision written by Gavin McKenzie, who had said a lot of good things about the importance of trial advocacy and how we should not do things that interfere with lawyers' representation of their client. The other, the other leading case was a fellow out of Hamilton named Franco Paletta, and Mr.
Paletta had been fired by his client. He was not happy about that, and when he found out that his client had hired a new lawyer who happened to be Jewish, he called the client up and the client tape recorded the call. And he unleashed a stream of antisemitic, awful language. It's all reported in the law reports if anyone wants to go and look it up. When I teach my class, I always ask if I'm allowed to actually say it, and most professors say no, just give them the site. So I don't. But anyway, it was really quite terrible what he said and did. And he got a reprimand. So I was struggling, obviously, with a decision that said defending myself was an abusive process and calling the Securities Commission the government was such a heinous act that I deserved a 2-month suspension and a couple hundred thousand dollars in costs.
So we appealed that to the appeal panel. And, you know, I described the hearing panel's decision as one of the worst decisions in the history of Canadian administrative law. And the appeal panel overturned their decision, said that they took a fresh look at what had happened on their own, and they convicted me all over again, reduced my sentence from 2 months to 1 month, and left the amount of money about the same. So I was sure, and Earl was sure, when we got to the divisional court, the courts would straighten this out. But we lost in the divisional court 3 to nothing. We went to the Court of Appeal. I got my first minor victory because Justice David Brown dissented in the Court of Appeal in a very well-written dissent.
So by the time we got to the Supreme Court, if you count all the judges and regulators who had decided against me, the score was about 20 to 1. But in the Supreme Court, November 2017, we had a wonderful hearing. Chief Justice McLachlin asked a bunch of really insightful questions. And in June of 2018, 6 to 3, we, we finally got what I thought to be the result that should have been, which is, you know, absent a lawyer doing something outrageous. Courts have the power to control the conduct of their own courtroom. And, you know, of course, if you get out of line, the judge may cite you for contempt. We now have a complaint process where a judge can complain about you.
But Justice Hryn never complained about my conduct once. And so he did, in fact, complain about the conduct of the Securities Commission and came very close, I think, to citing them for contempt. But never complained about what I had done. So, you know, I think the Supreme Court has now made it very clear that judges are in control of their courtrooms, and absent something outrageous the only thing you need to worry about is a judge referring your conduct to the Law Society, because this happened a couple of years ago before COVID A lawyer challenged a witness to step outside and settle things like a man. So, you know, that kind of behavior falls outside the boundaries of even the most zealous advocacy one can imagine.
You know, you mentioned the Chief Justice and that November day of 2017 at the Supreme Court of Canada when you finally prevailed, and your lawyer was Earl Cherniak. And I just wanted, as an aside, to say that both Earl Cherniak and the Chief Justice were guests of the show. The Chief Justice episode was a very recent episode, and Earl Cherniak was probably a few months ago. Just for everybody out there watching, please go and listen to the Chief Justice, former Chief Justice Beverley McLachlin's interview, and also Earl Cherniak's interview for this show. Please find them and listen. They're amazing. You know, just for context, I know that the Law Society held it against you that you produced— you have a winery in the Niagara region, and they held it against you that you made wine and you called your line of wine Civility and Incivility, just for context, right?
And they also held it against you that you use the word government to refer to the Crown. But this is context. Wasn't the central allegation though about document production and your allegation that the government or the prosecution didn't fulfill its promise to produce documents. So essentially, you accused them of lying. And wasn't that the core allegation against you when they said that you were uncivil? And didn't Justice Moldaver deal with that in his reasons? He wrote the reasons, by the way, that sided with you in the Supreme Court of Canada. And he said that you sincerely thought, sincerely believed that the prosecution had a duty or promised, in fact, to produce the documents in question to you.
And when you accused them of failing to live up to that promise, it was not because of a factual distortion, not because you distorted the facts, but because you didn't understand the applicable law. Is that a fair description of what happened centrally in this case?
It is a fair description. And one of the challenges for someone in my position is not to be seen like a sore winner. But when I said earlier today that we lost control of the narrative, those findings were made against me by Archie Campbell and Mark Rosenberg during the first round when they were trying to get rid of Justice Hryn. And it's a, always gonna be a great disappointment for me. I may write after I retire a journal article about this because it was said that I tried to persuade the court that any document that was produced under Stinchcomb was therefore relevant and admissible. And that's not an argument I ever made, although it was said that I had.
The argument that I made was that the Securities Commission had produced a lot of documents under Stinchcomb, but they also had produced 103-inch or 4-inch binders of documents that they wanted to mark as trial exhibits, and they wanted that evidence to go in with my consent. And I said to the prosecutors, look, I'm not going to consent to all of them, but I'll consent to a bunch of them. And why don't we just agree on the things that I will let go in and let's fight about the rest. They never agreed or were never willing to do that. And so what I said in front of Justice Hryn was, look, the Securities Commission has vouched for these documents.
They want them all to be marked as exhibits. We're now far beyond the representations that get made in Stinchcomb. We've actually got a prosecutor saying, Judge, let's mark all of these as exhibits. So my argument was based on an exception to the hearsay rule that I could mark those documents from their binders that I wanted to mark because the reliability was vouched for by the prosecutor, and the necessity was I had no way of getting them admitted otherwise, most of them having come from Indonesia. And I was going to argue what was called the omnibus document motion at the end of the case, where I was going to say to the court, you should let those documents in that I want to have go in because the government has vouched for all of them.
And that, that was the fight that Justice Moldaver translated into my saying that I was arguing anything produced under Stinchcomb was relevant, and therefore I could get it in if I felt like it. Everybody skipped over that middle step because Justice Campbell skipped over that step. And we could never get back from that recovery. But yes, you're right. The finding of the court was where a lawyer has an honest but mistaken belief in the law and is putting forward in good faith arguments based on that mistaken belief, you can't find them to have engaged in uncivil behavior for representing their clients.
Pardon my obtuseness here, but can you go over this issue once more? So the issue of you holding an honest but mistaken belief about the law, and we're talking about the law of evidence here, of course, right?
Right.
You before the Bre-X trial, you did how many Superior Court trials did you do before the Bre-X trial?
75 or 100.
Yeah,
it's probably, probably 100 or 150 provincial court trials.
So just, can you help me wrap my brain around this? How could you have an honest but mistaken belief about the state of the evidence law at trial?
See, I say it was an honest belief but not a mistaken belief. You know, the admissibility of a document requires essentially a 3-stage process. One, the document has to be relevant. And my argument was that the Securities Commission has established the relevance of the document by vouching for its admissibility and saying to the judge, we want you to let all these documents in. So you can't on the one hand say we want the document admitted as an exhibit and then turn around and argue, well, it's not relevant. So step 1, the relevancy was established by the representations of the prosecutor. Step 2 is authenticity. You have to show that the document is reliable or is what it purports to be.
And I said the reliability was established by the government wanting to mark the documents as an exhibit. So I then said the only thing that's missing in my view is the consent of the other side. I'm consenting to let this document go in, and the Commission, having put it forward in their binders and having vouched for it, should not be allowed to say, well, because Joe won't consent to everything, he can't consent to anything. So that was going to be the abuse of process argument we were going to make at the end based on their representations. But what had happened along the way was that that principled argument, which I still think is a correct one, had been translated by the earlier courts as my saying any document produced in disclosure could be admitted by my consent.
And I never argued that. I would never argue that. But what I had that was unique was the commission essentially vouching for these documents and saying, we want them all in. And that I was an unreasonable person for not consenting to everything. And, and I should tell you, Pulat, that's the way the second part of the trial ran. Every witness— the documents that the commission wanted to put to a witness, they gave me a list. I went through the list. We probably consented to 80 or 90% of them going in, and we fought about a handful. And I've done hundreds of trials where the two sides agree on a joint book of documents, but You know, the notion that the joint book of documents, I have to consent to everything my opponent wants, is ridiculous.
And the Commission's actions, I thought, were absurd. But as I say, that got translated into a suggestion that I was arguing something that was clearly incorrect on the law. So I don't think any defense lawyer who's done any criminal work would tell you that just because it was produced under stinchcomb, that makes it admissible.
The majority of the Supreme Court of Canada sided with you. 3 judges dissented. Justice Moldaver wrote the reasons for the majority. Why do you think Justice Moldaver was chosen to write the— for the majority?
Well, he, he is probably maybe next to G. Arthur Martin, the preeminent criminal law judge in my lifetime. And somebody who's written many, many important decisions about the criminal law and somebody who had been a criminal defense lawyer and he had been in the trenches like I was in the trenches and he understood the importance of creating a safe harbor for defense lawyers. So, you know, I, I'll be honest, Earl, Earl and I both thought we were going to lose in the Supreme Court, not because we didn't deserve to win, but because the standard of review for an administrative decision like ours is reasonableness. And we were hoping that the best we were going to get was the Supreme Court to disagree with the findings that were made by the Law Society appeal panel, but to say that although we wouldn't have come to this decision ourselves, we can't say it was completely unreasonable, and therefore, Joe, you lose.
So I, we were, I was at the winery on the morning of June 1st, 2018, waiting for the decision, and I have to tell you Probably took me 20 minutes before I got out of a state of shock when I found out we had won.
You know, in her interview with me, the former Chief Justice Beverley McLachlin said that she had a civil libertarian bent. I think this is a fair description of her words. Well, she valued civil liberties and Of course, she presided over so many charter cases and over the development of our charter case law. She was there for such a long time. Do you think that civil libertarian bent was also a factor in why the majority of the Supreme Court decided to protect defense lawyers' ability to defend the accused?
It's, it's an incredibly important example of free expression being upheld by our Supreme Court. And it's expression, of course, in a very controlled environment. But we argued the case on the basis that trial lawyers have different styles. You know, your style, Pulat, is going to be different than my style. My style, I adjust from judge to judge, and I test the boundaries of what a judge will let me get away with. Some judges will tolerate a lot of rhetorical flourishes and other judges won't. So, you know, here I was getting a very good hearing from Justice Hryn, not being criticized, seeing that he was criticizing my opponents. And so I proceeded to engage in what I think to be the best trial advocacy, which is to present a case in a way that the judge finds favor with.
Now, you know, I'm sure you have— I know I have been on it on many cases where the judge is not finding any favor and is essentially trying to make me shut up and sit down which of course you can't do that either. Because that's a disservice to your client. But, you know, I think what the court in, in Bre-X— well, in the Law Society in Groia— said was essentially there are many different styles of trial behavior, many different kinds of lawyers who represent their clients in very different ways, and absent some kind of aberrant and extreme behavior We're not going to allow regulators to discipline lawyers for courtroom behavior absent a judge finding them in contempt, or absent a judge saying, you know, Mr.
Groia, you're out of line, I'm going to write a letter to the Law Society.
Do you think the Supreme Court of Canada today would have ruled in your favor in the same case?
I think, I think so. And, and I think that in fact it might be more like 7 to 2 than 6 to 3.
We don't have a lot of time left, but I think we have just enough time left to talk about the Law Society today and the state of the Law Society today. You were a bencher of the Law Society for several years. I think you are qualified to talk about the Law Society. You decided not to run in the recent bencher elections.
Yep.
Please comment on those questions.
So my, my history with the Law Society It's always going to be very complicated, Pulat. I ran in 2015 because I had been losing in the courts. Well, I'd lost by then at the Div Court, I lost at the Appeal Panel, the Hearing Panel, and I felt like a very lonely voice in the wilderness. And so I thought, I'm going to run this, be a bencher to see if I have the support of the profession and I don't get elected, I don't know what I would have done with my appeals. I probably would have continued, but I'm not sure. So when I got elected, of course, I was the outsider, and I showed up, and the Law Society was sure that I had horns hidden somewhere.
And I, I spent the first year learning a great deal about it. And as time went on, I did not sit on the tribunal because I didn't think, as somebody who was being prosecuted himself, I should be sitting in judgment of other lawyers. So from 2015 until June of 2018, I worked very hard and I contributed in a number of different ways, but I really felt I was under a cloud. So my last year, 2018 to 2019, after the decision came out, I became much more active and started to really express views that I thought needed to be expressed. And then the, the election of 2019 happened, and of course all hell broke loose.
And the last 4 years was a very difficult time. We had a group of very determined benchers who had their own agenda that I certainly didn't share. And, you know, when COVID came, I was made the Chair of Audit and Finance, and I worked very hard for 2 years to preserve and protect the Law Society's finances. And in fact, we came out of COVID in a very strong financial position. But then for my last year, I really felt like I had gone back to being an outsider again. I was not part of the coalition. I was not part of the slate. I was trying to be an independent voice on many of the issues.
I sometimes voted with the slate and I sometimes voted with the coalition. But I came to realize that party politics had arrived. And I was strongly opposed to that. I am strongly opposed to that. So I decided not to run again and to devote my energies to getting the vote out because we clearly needed the profession to come and speak to who was going to run the Law Society after this election. And of course, we saw that the vote was up by 35 or 40%. It broke down clearly along party lines. The Coalition all got about 11,500 votes. The Slate got about 5,500 votes. The Independents got crushed. And so now you have a law society that is 38 Coalition members and 2 Slate members because of 2 people who were elected that have stepped down.
And, you know, I'm quite worried about the future of Law Society elections because I don't want to be in a position where I can't get good people elected because they're not prepared to be a member of either party. I expect the slate's gonna be back in 2027. Now the Coalition has promised to disband. I'm talking to a number of Coalition members You know, they're all promising me they're going to act independently and we're going to have the kind of informed discussion and debate we need to have. But you know, there are serious issues at the Law Society. The policy of transparency that needs to be there is not being followed. I think committee meetings where the worst bencher behaviour is found needs to be made public because I think What happens in committee is important.
There's a serious financial issue dealing with LawPro. LawPro has become a huge financial success. It's owned 100% by the Law Society, and it made $60 million in the last 5 years before last year. And as chair of Audit and Finance, they refused to even talk to me in any meaningful way about paying the Law Society a dividend. So about half the lawyers in Ontario buy insurance from LawPro. The other half do not. So what that means is essentially half the profession is subsidizing the other half to get deeply discounted insurance. So I, I've got great hope for this new bench. There's some very bright, energetic new people. There's 31 new benchers. There's only 9 or 10 holdovers.
I just hope they seize this opportunity and start to make the changes that need to be made, because certainly the Law Society that I wanted it to be never became that way, and it's still in many ways far too much like a club that I don't want to belong to as a member.
Joe, thank you so much. This has been a wonderful interview. Lots of food for thought. I really appreciate it.
Thank you, Pulat. Thank you for the invitation and best of luck with your series.