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A Manitoba judge under investigation for sexually-explicit photos was upfront about the pictures when she was screened for a position on the bench, another judge testified Friday.

"There was knowledge of the photographs and we were to follow up," Justice Martin Freedman told the Canadian Judicial Council inquiry into the conduct of Lori Douglas. Freedman chaired the committee that screened Douglas and other potential new judges.

"There was an ... unquantifiable possibility that this could create a problem."

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The inquiry is examining whether Douglas should lose her job as associate chief justice of the Manitoba Court of Queen's Bench because of a controversy that began with her husband Jack King's harassment of a client.

In 2003, when Douglas and King were family law lawyers at the same firm, King uploaded sexually explicit photos of Douglas, some of which showed her in bondage gear or performing sex acts, to a website dedicated to interracial sex. He also emailed photos to a client named Alexander Chapman and asked him to have sex with Douglas.

Chapman complained to the law firm and King settled the matter within weeks by paying Chapman $25,000 to return all the photos and to never discuss the matter. Chapman broke that deal in 2010 and complained to the judicial council, insisting Douglas was part of the sexual harassment.

Among the allegations before the inquiry is that Douglas did not disclose the matter when she applied to be a judge. She applied three times before finally being accepted in 2005.

Freedman told the inquiry he had heard from other judges about the controversy in 2003, and when Douglas was screened in 2005, he discussed the matter with Marc Monnin, the chief justice of the Manitoba Court of Queen's Bench.

"(Monnin's) understanding was that Ms. Douglas was an innocent victim of her husband ... and that the photographs had either been destroyed or removed," Freedman told the inquiry.

The screening committee still had concerns, so it asked Margaret-Rose Jamieson, the senior federal official overseeing the screening process, to telephone Douglas and make sure the controversy was over.

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"One of the reasons for that was ... ensuring that whatever photographs had existed no longer existed," Freedman testified.

Jamieson testified Friday that she discussed the issue with Douglas, although she could remember few details.

"(Douglas) said 'but the whole matter has been resolved. The photographs have all been taken off the Internet."'

On her application form, Douglas answered "no" to the question "Is there anything in your past or present which could reflect negatively on the judiciary and which should be disclosed?"

Freedman said he was not surprised with that answer.

"My understanding was that Ms. Douglas regarded this as a closed and dead issue and ... that she was an innocent victim."

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The committee never pressed for details about how graphic the photos were, or about the pornographic nature of the website where they were originally hosted. In the end, the committee recommended to then-federal justice minister Irwin Cotler's office that Douglas be appointed a judge and she was appointed later that year.

The inquiry has already been told that federal Justice officials do not remember being told about Douglas's nude photos. A journal entry from Francois Giroux, an adviser to Cotler, does not mention the photos. It only mentions that Douglas's husband had harassed a client and tried to entice him to have sex with Douglas.

Freedman, however, said he is certain information about the photos was passed on to Cotler's office.

The recommendation to appoint Douglas came with "a caveat, a red flag, something," Freedman testified.

"(Cotler) could have come back to our committee and said `I want more information."'

The inquiry, which is also examining three other allegations against Douglas — including that she participated in her husband's harassment of Chapman — was almost derailed this week.

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Douglas's lawyer, Sheila Block, demanded the inquiry be scuttled on the grounds it was biased against her client. Block was upset over the way the lawyer who asks questions on behalf of the inquiry panel members questioned some witnesses. She called it "aggressive" and "withering" and "demeaning".

But her demand was rejected Friday.

"By definition, an inquiry ... is a search for the truth. We are bound to pursue it," said Catherine Fraser, the chairwoman of the inquiry who is also the chief justice of Alberta.

"There were a number of matters that required followup."

The inquiry panel includes Fraser, Derek Green, the chief justice of Newfoundland and Labrador, and Jacqueline Matheson, chief justice of Prince Edward Island. Two lawyers from other provinces also sit on the panel.

The inquiry ended Friday with no date set for its next round. Hearings are expected to resume in the fall.

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The hearing is a rarity. The Canadian Judicial Council has only held them nine times across the country in 40 years. It has only once recommended that a judge be removed.

In 2009, the council recommended to the federal government that Paul Cosgrove be removed as a justice of the Ontario Superior Court due to incompetence and abuse of his powers. Cosgrove resigned before the federal government could make its decision.

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