VANCOUVER — British Columbia’s clerk of the legislative assembly says she returned a retirement benefit that was also awarded to her predecessor because she felt “uncomfortable” with it and found the size “very concerning.”

Kate Ryan-Lloyd, who was Craig James’s deputy at the time of the 2012 payment, told a B.C. Supreme Court trial that she gave back the $118,000 benefit after James failed to provide her with a good explanation to justifying the payment. 

James’s trial has heard his own claim of a nearly $287,000 retirement allowance is the largest sum in a string of payments that prompted allegations that he used public funds for personal benefit.

“It was not right to hold onto these funds. I did not see a rationale for holding them,” Ryan-Lloyd told the court on Friday. 

Ryan-Lloyd said that when she told James she intended to return her allotment, he said, “Well you can do what you want but I’m keeping mine.”

James has pleaded not guilty to two counts of fraud over $5,000 and three counts of breach of trust by a public officer.

The trial is unfolding more than three years after he was escorted from the legislature in 2018 amid an RCMP investigation into the allegations.

The prosecution has said the case rests on three main areas: the retirement allowance, the purchase of a trailer and wood splitter, and travel expense claims. 

Ryan-Lloyd was appointed deputy clerk in 2011 while James was named clerk, a role likened in court to that of a CEO responsible for the administration of the legislature. She assumed James’s role after he was placed on administrative leave. 

Ryan-Lloyd told the court that she first learned of the retirement benefit in late 2011 when two members of the clerk’s office announced plans to leave their jobs and sought payment. 

The court has heard the allowance was created in 1984 for officers who did not qualify for public pension plans or executive benefit packages, but that the payment structure for those officers changed in 1987. 

Ryan-Lloyd testified that James was initially “skeptical” of the two members’ claims to the benefit and told her that for advice, he retained a lawyer, with whom he frequently mentioned spending an “enormous” amount of time consulting on the issue. 

On Feb. 10, 2012, she said, James told her that based on legal advice, then-Speaker Bill Barisoff had determined the retirement benefit was still effective and both she and James qualified.

“That was very surprising news to me, and I had many questions and concerns at that point,” she said.

Barisoff advised the program should be terminated and all outstanding claims should be paid out to eliminate ongoing liability to the legislative assembly, she told the court. 

Ryan-Lloyd asked James as much as she could about the how eligibility was determined and why she and James would be included, she said. She also met with Barisoff, who confirmed the decision, she said.

The funds were deposited in her account Feb. 17, 2012, but she said she did not spend any of it. 

“Things had moved very quickly that week and I had to consider how to proceed. I knew I needed to reflect on what had happened,” she testified. 

Ryan-Lloyd told the court she began asking questions again after an audit team reviewing financial records of the legislative assembly noticed the substantive payments and sought more information. 

The team was appointed after a 2012 report from the auditor general’s office critical of financial management at the legislature.

Both Ryan-Lloyd and the audit team repeatedly asked James to forward the documentation and he said he would but never did, she said.  

“I began to get quite direct and I said, ‘Could I please have a copy so I can provide it to (the auditor) and I can satisfy myself as well,’” she said.

Ryan-Lloyd testified that she had assumed, when James consulted a lawyer, that he had obtained a written legal opinion on the benefit with formal recommendations outlining a process for determining eligibility. 

James told Ryan-Lloyd to ask his administrative staff for the documentation, she said, but they came up empty-handed.

When she returned to James, he told her to look for it at the Speaker’s office, she said. Staff at the Speaker’s office said they did not have documentation either, she said. 

“I was quite humiliated and drew a conclusion at that point that there was no documentation,” Ryan-Lloyd testified. 

Ryan-Lloyd wrote a formal letter to document her decision to return the funds and formally release the legislative assembly of any further commitment to her relating to the retirement benefit. 

“When there was no documentation, it became clear to me that this was not a transaction I felt comfortable with,” she said. 

Ryan-Lloyd told the court she only saw a legal document relating to the benefit payments in 2019, after a report by then-Speaker Darryl Plecas detailing the misspending allegations against James.

It was drafted by the same lawyer consulted by James and dated September 2013, months after she returned the money, she said. 

She described it as a brief document summarizing verbal legal advice, rather than the formal written legal opinion she had expected. 

Ryan-Lloyd was also asked about documents that were brought to the court’s attention Thursday, causing a delay. 

One document is a calculation of retirement benefit payouts.

Another is a letter from Barisoff to James dated January 2013, amending the policy for approving the clerk’s travel expenses by delegating authority to the executive financial officer to review and approve them on the Speaker’s behalf. 

Ryan-Lloyd said she didn’t recall the letter, although she was copied on it, and described it as “unusual” because she didn’t believe any formal travel expense policy existed for the clerk until 2019. 

This report by The Canadian Press was first published Jan. 28, 2022.

Amy Smart, The Canadian Press