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Debts put former Liberal candidates in awkward spot

Leadership candidate Joe Volpe delivers his speech at the Liberal leadership convention Friday, Dec. 1, 2006 in Montreal.

Ryan Remiorz/CP

Three of the four former candidates who have debts outstanding from the 2006 Liberal leadership race have been thrust into a bizarre form of legal limbo after opting not to appeal a judge's decision that they had run out of time to pay the money back.

Martha Hall Findlay, Hedy Fry and Joe Volpe exhausted two extensions of the original deadline for returning the money they borrowed to finance their campaigns. They cannot close their campaign bank accounts until all debts have been paid, but, because they chose not to appeal the ruling of the Ontario Superior Court, Elections Canada rules dictate that they can no longer make payments unless the creditor takes them to court.

In other words, should Ms. Hall Findlay raise the less-than $45,000 she estimates she still owes, all of which she lent to herself, she will have to take herself to court to pay it back.

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Ken Dryden, who owed hundreds of thousands of dollars at last count – also to himself – is on a different payment schedule to the other three former candidates, but will likely be in a similar situation.

Elections Canada will audit the candidates' returns and, once it has officially been established that they still owe money, the cases could be turned over to the Commissioner of Canada Elections. Eventually, the candidates could be charged with violating the Canada Elections Act, and if found guilty, they could be forced to pay a $1,000 fine or spend up to three months in jail.

The former contestants are caught in a bind the Conservative government created by changing the law halfway through the 2006 campaign to prevent any donor from giving more than $1,100, in total, to candidates in a single leadership race. Any donor who has already given $1,100 to a candidate to help with expenses from the 2006 race is not permitted to make any further donations related to that campaign.

With the party's popularity waning and the pool of card-carrying Liberal donors practically exhausted, it has not been easy for the candidates to raise funds to pay for a contest they lost six years ago.

The government has introduced legislation that would restore donors' ability to contribute a maximum annual amount to contestants in the same leadership campaign year after year. But it has yet to be passed. And now Ms. Hall Findlay, Ms. Fry and Mr. Volpe are stuck with debts they are not permitted to repay without going through the courts.

It is a strange situation, concedes John Enright, a spokesman for Elections Canada. But it is not unusual, he said. Hundreds of past candidates for federal seats are in a similar bind.

Eighteen months after the 2006 election, for instance, Foreign Affairs Minister John Baird still owed himself $1,604.06. New Democrat MP Nathan Cullen owed the Canada Revenue Agency $103.62 from 2008. And Jean Crowder, another NDP MP, owed herself $215.31 from the 2004 campaign.

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"If you go back to the last three general elections, there is about $3-million there in unpaid claims or loans for candidates of all political stripes that are still on the books," Mr. Enright said. "And they are in the same position in that, if they want to repay those [amounts], it's got to be done through the courts."

But those electoral candidates were not hamstrung by the same restrictive rules governing donations to leadership campaigns.

Former candidates who owe amounts from previous federal campaigns are not prevented from running again and that also applies to leadership races. So, Ms. Hall Findlay could become a candidate in the new Liberal contest without clearing her books from 2006. But that is not something she wants to do. She said this week that she hopes that some sort of compliance arrangement can be reached with Elections Canada and the debt will be paid by the fall.

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