Did TCL act properly?

Metro Centre operating contract requires Metro Centre accounts to be held separately from Ticket Atlantic account.

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The improper loans to Power Promotions were funnelled through the Metro Centre, a city-owned facility that is managed by Trade Centre Limited. Officials at TCL have said that they were under no obligation to vet the appropriateness of the loans---the city owns Metro Centre, so when city official Wayne Anstey called them up and directed them to loan Power Promotions money from Metro Centre accounts, they simply complied without asking questions.

But what if Anstey had called and directed TCL to cut a cheque to his wife? Would TCL have complied without question?

What exactly are TCL's responsibilities to vet Metro Centre expenses? That question will no doubt be taken up by the city's auditor general Larry Munroe, who's now investigating the matter.

At the centre of the question of TCL's obligations is the 1982 contract between the city and TCL for operating Metro Centre. The relevant portion is the surprisingly short Clause 4:

metrocentreoperating.jpg
These are questions for lawyers and accountants, but here are some of the issues:

Does the operating agreement allow city officials to intervene in the day-to-day operations and cash flow of the Metro Centre? If not, doesn't the impropriety of the loans to Power Promotions fall directly on TCL's lap?

Since the financial accounts of the Metro Centre are required by the contract to be kept separately from the accounts of other TCL obligations, how is it possible for city officials to secure loans made through Metro Centre with ticket sale revenue collected by a separate TCL operation---Ticket Atlantic---that has no financial connection to the Metro Centre? More, didn't the repayment scheme---based on future ticket sales---put the risk in TCL's hands? Since the accounts are separate, doesn't TCL have the obligation to make good on the defaulted loans? And if so, did TCL officials act improperly with regards to their obligations to the province?

I don't know the answers to those questions, but I'm sure readers will have opinions. You can read the entire operating agreement here.

For The Coast's complete coverage of the Common concert financing scandal, click here.

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