Mulroney didn't reveal cash because he wasn't asked
Published Thursday, May 14, 2009 6:55PM EDT
Brian Mulroney faced pointed questions Thursday over why he failed to reveal during court proceedings in 1996 that he had received thousands of dollars in cash from Karlheinz Schreiber.
Even though Mulroney had received $225,000 in cash dating back to 1993, the former prime minister didn't report the income or declare it to Revenue Canada for several years.
And during lawsuit proceedings the former prime minister launched against the government in 1996 over the Airbus scandal, Mulroney only said that he had met Schreiber "once or twice for coffee."
On Thursday, he defended the lack of disclosure.
Responding to questions from lawyer Richard Wolson, Mulroney added that he was locked in a Herculean struggle with the government 13 years ago and was instructed by his legal team to refrain from offering up extra information.
"The nine lawyers sitting there . . . out to crush me and my family . . . this was not conducive to a friendly exchange of information or compromise ... I was fighting for my life and the honour of my family," said Mulroney about the libel suit.
Still, Wolson continued to question Mulroney's motives.
"As a former prime minister of the country, knowing that you had a legitimate business relationship, you didn't think you should say . . . I had a business relationship?" asked Wolson.
But Mulroney maintained that he was truthful about his business dealings.
Mulroney participated in the 1996 examination for discovery as part of his lawsuit against the government over allegations that he accepted kickbacks in the Airbus affair.
Mulroney said if Claude Armand Sheppard, the government lawyer who questioned him back then, would have asked about money he received from Schreiber he would have answered it truthfully.
Wolson noted that none of the lawyers would have asked about any business dealings because none of them knew about any dealings.
"How in the world would nine lawyers or 900 lawyers know about a commercial business relationship? You were the only one in the room who knew."
Mulroney said he wasn't there to volunteer information.
Justice Jeffrey Oliphant asked Mulroney why he then volunteered during his 1996 testimony that Schreiber had retained former Liberal finance minister Marc Lalonde but he didn't say anything about himself being retained.
"It was essential to the point that I was making about the answer I was providing," Mulroney said.
The affair dates back to the 1988 sale of 34 Airbus jets to Air Canada -- then a Crown corporation.
Mulroney sued for defamation in 1995 after a letter from the RCMP that linked him to kickbacks in the deal was leaked.
In 1997, Jean Chretien's Liberal government paid Mulroney a $2.1-million settlement.
The Liberals apologized to Mulroney for the "letter of request" but not for the actual RCMP investigation, which ended six years later without charges.
Schreiber's lawyer is also expected to question Mulroney.
For the past two days, Mulroney has faced relatively easy questions from his own lawyer, Guy Pratte.
Mulroney said it took him several years to declare the $225,000 he received from Schreiber because the money was a retainer and he did not consider it to be part of his taxable income at the time.
He said he paid taxes on the money in 1999, when it became part of his income stream.