Court of Ap­peal quashes Kelly’s resti­tu­tion or­der

For­mer CRDA ex­ec­u­tive orig­i­nally or­dered to re­pay the prov­ince $97,000

The Amherst News - - FRONT PAGE - BY DAR­RELL COLE dar­rell.cole@amher­st­ Twit­ter: @ADN­dar­rell

Rhonda Kelly will not have to pay the prov­ince $97,000 in resti­tu­tion as a re­sult of her role as the ex­ec­u­tive di­rec­tor of the for­mer Cum­ber­land Re­gional De­vel­op­ment Au­thor­ity.

In a 15-page de­ci­sion re­leased Wed­nes­day, the Nova Sco­tia Court of Ap­peal agreed that Kelly did not per­son­ally ben­e­fit from the money and didn’t see why the for­mer ex­ec­u­tive should have to pay out her own pocket for money that used to ben­e­fit the com­mu­nity.

“There was no elab­o­rate scheme that dis­guised where the funds were spent. As the Crown ac­knowl­edged in its fac­tum, it was CRDA’s gen­eral ac­count­ing sys­tem that pre­vented know­ing ex­actly where ev­ery dol­lar raised was spent, be­cause there was comin­gling of project funds,” Jus­tice J.A. Bev­eridge said in his writ­ten de­ci­sion. “That was the prac­tice at CRDA, not part of an elab­o­rate scheme hatched or per­pe­trated by (Kelly).”“I agree jus­tice should be done, but how is it just that $97,000 of tax­pay­ers’ money was spent on CRDA op­er­a­tions and projects, but Ms. Kelly be­comes the sole tax­payer that must, over her life­time, be re­quired to pay for those projects? Based on this record, that would be the ef­fect of the resti­tu­tion or­der im­posed by the trial judge.”

Kelly re­ceived eight months house ar­rest fol­lowed by four months of abid­ing by a cur­few af­ter plead­ing guilty in April 2017 to caus­ing Economic and Ru­ral De­vel­op­ment and Tourism to act upon a forged doc­u­ment.

Nine other charges were dis­missed.

Jus­tice Bev­eridge said that while the trial judge tried to bal­ance the in­ter­ests of the vic­tim with the po­si­tion of the ac­cused, “there was ab­so­lutely no ev­i­dence that the prov­ince lost money by the com­mis­sion of the of­fence of ut­ter­ing forged doc­u­ments. The ap­pel­lant was not charged with theft of monies. She was charged with ut­ter­ing forged doc­u­ments and fraud. She was found not guilty of fraud.”

Even if the fraud charges had been in play, he said, a con­vic­tion for fraud does not au­to­mat­i­cally equate to a loss of prop­erty that opens the door to a po­ten­tial resti­tu­tion or­der.

Jus­tice Bev­eridge said the agreed state­ment of facts stated the money went to CRDA. None of it went to Kelly’s per­sonal ben­e­fit and there “is no ev­i­dence to sug­gest that funds were ‘di­verted’ from com­mu­nity projects.”

Be­cause of the ab­sence of any ba­sis to say the prov­ince suf­fered a loss of prop­erty be­cause of the com­mis­sion of an of­fence is suf­fi­cient to quash the resti­tu­tion or­der.

The Court of Ap­peal also said there is no merit in the sug­ges­tion that Kelly com­mit­ted a breach of trust.

“I do not doubt that provin­cial of­fi­cials trusted her doc­u­ments, but ev­ery fraud­u­lent trans­ac­tion in­volves a vic­tim plac­ing trust in the of­fender; that does not make their re­la­tion­ship one of trust in the sense of a rec­og­nized ag­gra­vat­ing fac­tor in sen­tence such as so­lic­i­tor-client, prin­ci­pal-agent, doc­tor-pa­tient or other sim­i­lar re­la­tion­ships,” Jus­tice Bev­eridge wrote. “Ms. Kelly was in a po­si­tion of trust vis-à-vis her em­ployer, CRDA. She did not steal from nor de­fraud her em­ployer. She ob­tained funds for CRDA from ERDT for CRDA’s use to op­er­ate and fund com­mu­nity projects. That does not mean she de­serves any praise for her con­duct. Far from it. Not only did she com­mit, on a num­ber of oc­ca­sions, a crim­i­nal of­fence, she in­volved oth­ers, even ex­pos­ing CRDA it­self to po­ten­tial crim­i­nal li­a­bil­ity.

While the trial judge said jus­tice had to be done and it had be seen to be done by the com­mu­nity, Jus­tice Bev­eridge said this rea­son­ing is flawed be­cause there was no elab­o­rate scheme that dis­guised where the funds were spent.

Kelly’s sen­tenc­ing last sum­mer ended a seven-year story that be­gan in 2010 when two CRDA em­ploy­ees were dis­missed af­ter voic­ing their con­cerns over some of the prac­tices tak­ing place in the govern­ment-funded or­ga­ni­za­tion.

An om­buds­man’s re­port backed up their con­cerns call­ing for a foren­sic au­dit that was com­pleted in 2013 by Price­wa­ter­house­Coop­ers.

Charges were laid against Kelly in 2016.

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