DB: “Purchases are normally made through the Purchasing and Contracting Division.” Who?
DB: You deal with hiring, consulting contracts?
DB: “…however, purchases under $2,500 may be made directly by the senator.” I read that to mean that purchase normally are made through Finance, if under $2,500 he can make that directly and doesn't have to go through finance?
SM: That’s what I read here, but I want to repeat that this is an area related to finance
DB: If it’s under $2,500, he can make that directly?
SM says invoices go to finance, not HR.
SM: I’m agreeing with you based on this guideline, but I don’t know if there are other finance rules or guidelines.
Crown objects - Neubauer says witness being asked questions about area she's not aware of. Says it’s misleading for Defence to suggest that just because witness doesn't know if there are other guidelines, that means there aren't any other rules and guidelines related to finance.
Judge – “If anyone is going to be mislead, it would be me, right?” Crown: Yes. Judge: “And I don’t think that’s going to happen.” (some laughter in the courtroom)
Judge allows defence to continue cross examination of Makhlouf, understanding that she doesn't know the subject of Finance. Her area of expertise is HR.
Bayne now going through the New Senators’ guide
Bayne asking about type of research or consultation, does it have to be written or can it be oral / SM says there aren’t any restrictions
Bayne now going to Exhibit A, Tab 16 – “Research and Office Expense Budget – Senators’ Offices”
Document reads: “A budget of $151,700 is allocated to Senators in order to give them more flexibility in the hiring of their staff.”
Turns to a page: “Work description – Senators’ staff. Legislative/Research Assistant.” Bayne listing responsibility and duties on that page.
Bayne: It’s a big range of acceptable research? It’s pretty open ended? / SM: Yes.
Bayne asking if a company entered into a contract with a Senator can sub-contract that work out to another company or another person. SM says she doesn't know who doing work when research contract is awarded by a senator. Work could be done by different person than signed, and she wouldn't be aware.]
Bayne reading contract between Senate/Duffy and Donohue
DB: You know a difference between corporation and human beings? / SM: Yes. … For me, a corporation is represented by a person, a contractor.
DB: I’m talking about carrying out the research. It’s contemplated that individuals will proceed with the research? / SM: For me the corporation is represented by a person, signed off on the contract, and he is responsible for that contract.
SM: All the services contract I did and approved for a corporation, there was a specific representative for the contract … but I wasn’t aware if there were other sub contractors.
DB says SM is interested only in the start/end date, short description, cost on the form. SM agrees.
DB: You don’t check behind that?
DB: That’s why you don’t know when you execute the corporate contract, and who’s doing the research work?
SM: Yes, right, it’s not part of my responsibilities
DB: You don’t think Senate Finance does it either, unless there’s a red flag?
SM: I can say I don’t think, but I can’t confirm
DB: You don’t know who they are, and you don’t ask
SM: That’s correct
Bayne on Tab 20 – Internal Economy tables 11th Report on December 15, 2010 – Annual Report on Internal Audits 2009-2010.
DB reads Internal Audits report: “In addition to the Senate Administrative Rules, there are 12 policies and procedures/guidance documented for processing and administration of Senators’ office expenditures. Several of the Senate’s policies are being updated and revised … There is a risk of inconsistent application of policies and understanding of the policies across Senators’ offices.”
Crown objects – witness can’t answer questions related to this document, and in Crown’s view, the document is inadmissible hear-say.
Judge: She may be able to shed some light as a result of this recommendation.
Crown: This isn’t her report, she can’t testify how the writing in this report was arrived by. She can provide relevant evidence on what her job is and how she did her job. This is outside her envelope. To start suggesting to put content to her is unfair and is inadmissible hear-say.
Defence: They just don’t like this document because it hurts their case. This is one they particular dislike because it show the disconnect of what they thought was going on in the senate, and what was actually going on in the senate. Because senators don’t understand the proliferation of rules. … This is a public document produced by the Senate. I can’t believe it’s hear-say document.
Crown: SM can’t give evidence on whether a Senator is confused by the rules, which can only be answered by Senator in question making non-compliant claims. Maybe it’s misunderstanding, maybe it’s deliberate. It’s a subjective question. To have SM say it’s evidence of misunderstanding, invites her to speculate. It’s purely subjective.
Judge: I don’t have problem with that point. She can be asked about the 12 policies in place, and those type of questions which then can be argued later – perhaps with addition evidence of defence. The fact that 12 policies in place as a factual thing, may lead to confusion. I don’t know yet. I think it’s fair to have questioning in this area to have her flush it out.
DB asking SM which 12 policies relating to Senators’ office expenses, and which procedures she is aware of.
SM: I can’t recall all of them; in HR there aren't many.
DB: Were you aware that 12 policies created inconsistent understanding of policies?
SM: I was aware that we were moving to a modernisation of HR policies. … that following this report, we had to do some modernisation of our policies.
DB: There was a recognition that there was inconsistency of policies? The message you got was we have to modernize these policies?
DB reading: “Formal Contracts: Senators’ office expenditures may not always have formal service contracts in place. There is a risk that terms and conditions are not well established and statements of services are not clearly defined.”