National Party of Canada - Dissolution

Dissolution

Even with Hurtig's decisive win in the June 1994 convention, internal divisions continued. Shortly after the convention Whetung unilaterally attempted to change the official and legal records of the Party at Elections Canada, naming himself as Party Leader and replacing recognized National Council members with self-appointed supporters. His attempt to affect a change in the membership of the National Council was rejected by Elections Canada. Hurtig resigned the leadership hoping to avoid the scandal and cost of the litigation that followed.

Loewen, a Fellow of the Certified General Accountants Association, (Mr. Loewen, removed from Party's Board of Directors by the Ontario Court of Justice, in early 1994, was never a member of the Party's National Council) publicly claimed to have launched several legal challenges to recover a purported $610,000 in unaccounted Party funds and assist Whetung with wresting control of the Party from its duly elected National Council. Though Loewen's name is repeatedly found throughout the hundreds of court filings, none of the related legal proceedings included Loewen as a plaintiff (Court Records). Headed by Daniel Whetung, the seven legal actions variously included Jacques Rubacha, Shirley Demaine, Diane Ullrich, Wayne Hill, Steve Ranta, and Garry Hollingsworth. None of the seven legal actions were successful for the Plaintiffs. However the cost of defending the Party from the seven legal actions, which did not appear to originate with Loewen, bankrupted the party.

In the words of Mdme Justice Dorgan, of the British Columbia Supreme Court (Victoria Registry, File 94 4041), regarding the unaccounted funds, there was "no merit in Mr. Whetung's claims".

The claim of missing funds, highly publicized in the media, was the cornerstone of Loewen's complaints. Those claims were pursued by Whetung. Documents, purported to be the Party's financial statements, and provided to Daniel Whetung were filed as evidence of missing funds in the British Columbia Supreme Court. The evidence contained a large (6 digits) duplicate entry, that was not supported by any accompanying financial documentation, and misrepesented the Party's financial position. Whetung's legal Counsel resigned after the duplicate entry was revealed to the satisfaction of the court.

With new counsel the Whetung group called for, and offered to pay for, a forensic audit of party finances. However, the Party had already placed what financial records it had with a forensic auditor earlier that year. The auditors were unable to complete an audit, as there were too many missing records. Whetung, while stating in the Federal Court proceeding that he was unaware of any of the Party's financial records, admitted in the BC Supreme Court to having the financial records that were needed to complete the audit. The BC Supreme Court ordered him to deliver what records he controlled to the auditors, and to pay for the audit. According to the Party's auditors not enough of the missing records were delivered to provide an opinion. Payment for their work was never received from the Plaintiffs.

After much work by volunteers, financial records meeting the requirements set by Elections Canada were provided to the Chief Elector Officer, prior to the de-registration of the Party.

The Whetung faction was represented by top law firms at both the provincial and federal levels. The National Council, short of funds, was represented by the Party's President and Chief Agent, William Stephenson. Treasurer, Michael Kim Stebner, and Leader, Paul Reid. All challenges to the National Council by Whetung's group failed from lack of merit. Costs awarded to the National Council have not been paid. The final court challenge at the Federal Court of Appeal failed on September 10, 1998 (Court file number A-1056-96). In an unprecedented move, the three member Federal Appeal Court delivered their decision from the bench in favour of the National Council, rejecting, outright, all claims by Whetung and the other plaintiffs.

Although party membership continued to grow after the 1993 election, the seven meritless court challenges having damaged the brand and the Party's finances, the National Party of Canada was prevented from promoting the Party's agenda or to contest any further elections. In June 1997, Canada's Chief Electoral Officer officially de-registered the party.

Some members of the Whetung group, and one of the group's legal counsel ran as candidates for other parties during the litigation to wrest control of the Party from the Party's National Council and members.