Mayor’s Law Firm Received Over $1 Million from City in Five Years
It’s fair to say that Mayor Matthew Shoemaker has been more diligent than most when it comes to transparency.
Since being elected in 2014 (and again in 2018) as a City Councillor, he’s easily maintained a perception of conscientiousness.
His successful 2022 mayoral campaign included a formal platform, something for which he hopes constituents will hold him accountable.
He’s pushed for Council meetings to be more accessible and has been publishing his weekly schedules online.
Image Credit: City of Sault Ste. Marie
Like those who came before him, he’s a lawyer by trade.
That fact is relatively uncontroversial.
As he recently told me, lawyers occupying the Mayor’s Office is a “common occurrence in the City’s history.”
However, what can be controversial is a mayor’s law firm receiving money from taxpayers.
A freedom of information request reveals that Wishart Law - where Shoemaker was once an associate and is now a partner - has received well over a million dollars from the City of Sault Ste. Marie in a five-year period.
The City agreed to release the dollar amounts of expenditures involving Wishart, but it refused to provide a brief description of the services provided, citing solicitor-client privilege.
In 2018 alone, Wishart received almost half a million dollars from the City for legal services.
2022: $103,749
2021: $161,518
2020: $114,931
2019: $224,550
2018: $479,917
Total 2018-2022: $1,084,665
Nonetheless, the payments from the City to Wishart don’t run afoul of the Municipal Conflict of Interest Act (MCIA), legislation in Ontario that seeks to prevent members of municipal Councils from using their positions for financial benefit.
The MCIA conceives of conflict of interest as formal decision-making made by a member of Council that could directly or indirectly benefit them financially (or otherwise influencing municipal decision-making that results in a direct or indirect financial benefit).
But if City staff make decisions like procuring external services that don’t require Council approval, it’s not necessarily a conflict of interest for a Council member to benefit financially from such decisions, provided they’ve not influenced staff.
Shoemaker knows a thing or two about the legislation as a prolific declarer.
Ontario municipalities are required to maintain a publicly available registry of such declarations, and Sault Ste. Marie’s is a modest binder at the Civic Centre.
It starts roughly in 2019 and shows that Shoemaker has declared a conflict dozens of times between 2019 and this year.
Still, in anticipation of running for mayor, Shoemaker sought some legal advice of his own.
He said he “proactively attempted to ensure [he] was conducting [himself] in accordance with the [MCIA] before running for Mayor.”
In 2021, he made a request to the City’s Integrity Commissioner, Antoinette Blunt, seeking guidance on when he ought to declare conflicts due to his relationship with Wishart.
Because Blunt isn’t a lawyer, she sought the opinion of someone who is.
Subsequently, Toronto area lawyer, John R. Hart, offered a report that provided some clarity on the applicability of the MCIA.
Blunt and Hart waived solicitor-client privilege (and Shoemaker confidentiality) to have the report included in the council agenda of January 31, 2022.
Image Credit: City of Sault Ste Marie / John R. Hart
Shoemaker said he uses the Hart report as a “guidepost” for when he ought to declare a conflict of interest and he summarized it like this:
“[A] conflict is issue specific, not company-specific or person-specific. When there is an expectation my firm will be retained on a given issue, then I must declare a conflict. Where a company or person that typically uses my firm has an issue before council that does not involve my law firm, then no conflict arises.”
He described his approach as a “reasonable process” that provided him a “reasonable conclusion.”
Nonetheless, Shoemaker didn’t answer questions about how he might be deriving a financial benefit from his partner status at Wishart if the City continues to use the firm for legal services.
When asked if his partner status meant that he derived a financial benefit from all legal services provided by Wishart, his response was terse: “I don’t intend to provide information on my personal finances.”
He also wouldn’t say when he became a partner with Wishart.
A previously archived version of the firm’s website shows that Shoemaker was an associate in June of 2019. Corporate records for the firm (as of May of this year) show that Shoemaker is one of its three partners.
According to the City’s CAO, Malcolm White, Shoemaker is notified when the City intends to procure the services of Wishart so that Shoemaker can proactively declare a conflict.
Because the City has its own legal department and several municipal solicitors, the payments to Wishart raise questions about whether the City’s legal needs are being met as efficiently as possible.
If hundreds of thousands of dollars are spent on external legal fees, taxpayers may wonder why the City doesn’t simply hire another municipal solicitor.
When asked about the relationship between the City and Wishart, CAO White said the City relies upon several different legal firms.
External firms like Wishart “are used for either specialized services/expertise or when workload or timelines dictate a need.”
CAO White couldn’t estimate the total share of the City’s legal needs being addressed by Wishart due to “a number of variables to assess.”
He also pointed to Shoemaker to answer questions about whether the latter has voted on items at Council that entailed Wishart’s services.
He said he’s “not aware” of any incidences of that and explained that a City decision to use Wishart’s services after Shoemaker votes on an item results in a notification for Shoemaker (in case the item returns to Council).
The only problem is that the public isn’t necessarily able to confirm that’s the case.
Due to the nature of solicitor-client privilege, members of the public (this researcher included) can’t know precisely why the City is incurring external legal expenses.
Blunt said that relationships and payments between the City, Shoemaker, and Wishart are “not under [her] mandate as Integrity Commissioner.”
As for whether there are Council votes including Shoemaker in which the City procured Wishart’s services, she said she’s “not privy to this information” and encouraged the use of freedom of information requests instead.
Douglas Judson is a former Fort Frances Council member (2018-2022) and a practicing lawyer with expertise in municipal law.
He was a part of the Ontario government’s consultation process that led to 2017 legislation mandating integrity commissioners and a code of conduct for municipal Councils.
Judson said it’s clear members of council aren’t violating the MCIA simply because they benefit financially from municipal decision-making.
Image Credit: Douglas Judson (douglasjudson.ca)
But things get “tricky” when there are already established relationships between a Council member’s employer and a municipality.
He suggested we understand the MCIA as a “‘floor’ with basic requirements,” one on which municipalities are free to build their own codes of conduct with more expansive guidance and obligations.
Municipalities typically delegate authority to staff to make procurement decisions involving relatively small amounts of goods and services. For Judson, this makes sense, because staff may need to “react quickly to issues and retain lawyers who have expertise in the given area of law.”
The City’s procurement bylaw states that it requires Council approval for expenditures that exceed $125,000.
Judson argued that the big picture is a need for Ontario municipalities to closely examine their policies.
For example, he suggested that the procurement of professional services (like files carried by external law firms), could feature a review period whereby municipalities re-examine the efficiency and value of its vendors over time.
In the case of municipalities requiring external legal services, the decision to use a firm connected to a member of Council could have nothing to do with the interests of the latter.
In general, a citizen’s employment context shouldn’t exclude them from public office either, so the key part is navigating potential conflicts with transparency and procedural fairness.
However, perceptions are sometimes much more important than reality in politics.
Complicating the matter is the fact that several individuals associated with Wishart donated the maximum amount ($1,200) to Mayor Shoemaker’s election campaign.
Ultimately, the question is whether the City will be comfortable continuing its relationship with Wishart now that Shoemaker is both Mayor and a partner with the firm.