Robert Howard, former CEO of St. Michael's Hospital, walks into the Superior Court Justice in Toronto on Nov. 22.Christopher Katsarov/The Globe and Mail
The former chief executive officer of St. Michael’s Hospital told an Ontario court this week that he was not aware the two men facing criminal fraud charges stemming from the facility’s redevelopment were secretly communicating with each other during the bidding process.
Vas Georgiou, the former chief administrative officer of St. Michael’s, and John Aquino, the former president of Bondfield Construction Co. Ltd., are each charged with two counts of fraud over $5,000. They have both pleaded not guilty and the allegations against them have not been proven.
The Crown’s case against the two men at the trial, which began last week, focuses on their alleged undisclosed business ties, as well as their alleged secret communications throughout the bidding process for the hospital contract, which Bondfield won in 2015.
Prosecutors allege Mr. Georgiou was part of the team selecting companies to bid on the St. Michael’s contract while he was also working on behalf of commercial properties companies controlled by Mr. Aquino.
Robert Howard, former chief executive officer of St. Michael’s, testified he did not know that Mr. Georgiou was given his own bondfield.com e-mail address, bccldevelopment@bondfield.com, and a BlackBerry supplied by Mr. Aquino, which the two men used to discuss the hospital project.
“It never occurred to me that Mr. Georgiou was communicating with Mr. Aquino outside official channels during the bid,” Dr. Howard said Thursday under questioning from Crown counsel Rachel Young.
Dr. Howard, a cardiologist who began his career at St. Michael’s in 1982 and served as CEO from 2009 to 2018, was speaking publicly for the first time about the procurement scandal swirling around the hospital.
Asked by Ms. Young what would have happened had any of the bids for the hospital revitalization not been accepted, Dr. Howard said the project was doable for the $300-million the government was prepared to fund. “We didn’t actually anticipate Plan B: Start over again,” he said.
In 2012, Dr. Howard said he actively encouraged Mr. Georgiou to apply for the No. 2 position at the hospital, which included meeting him for coffee to discuss his candidacy. Mr. Georgiou, a long-time senior public servant, had held various executive positions at Infrastructure Ontario, the agency that manages the province’s major public-sector building projects.
Mr. Georgiou was knowledgeable about big construction projects and he knew people in the industry, Dr. Howard said. “That was his major, major strength.”
In January, 2013, Mr. Georgiou joined St. Michael’s to oversee construction of its $300-million redevelopment, including a new 17-storey patient care tower and an expanded emergency department. The hospital was founded in 1892 with a mission to treat Toronto’s poor and vulnerable, but had outgrown the space it occupies in the city’s downtown core.
Mr. Georgiou did not declare any conflicts of interest arising from his business ties to Mr. Aquino, Dr. Howard told the court.
When Mr. Georgiou was hired, Dr. Howard said, he asked for the go-ahead to get involved in “outside activities.” His employment agreement included permission to perform professional activities such as board memberships, advisory roles and consulting services for up to 20 days a year, according to a letter to him from Dr. Howard sent during the hiring process. The letter was filed in court as an exhibit.
Those provisions were “unique” to Mr. Georgiou, Dr. Howard told Ms. Young. Dr. Howard said he was to review any outside activities, but none were brought to his attention.
“If he was going to be involved in something he would have let me know, so I assumed he wasn’t involved,” he said.
After launching an internal investigation, the hospital fired Mr. Georgiou in 2015, alleging his business ties with Mr. Aquino weren’t disclosed. Since then, the project has fallen into disarray and is seven years behind schedule. EllisDon, one of the initial bidders, took over the project after Bondfield sought bankruptcy protection in 2019.
During his cross-examination, Peter Brauti, a lawyer for Mr. Georgiou, suggested that his client made no secret of his outside business interest in a bottled-water venture. Mr. Georgiou and Mr. Aquino had a stake in OTEC Research, which manufacturers GP8 Sportwater.
Dr. Howard said under questioning from Mr. Brauti that he did not recall Mr. Georgiou mentioning his involvement in OTEC and GP8 when he was interviewed for the hospital job. Mr. Brauti noted that Mr. Georgiou had supplied bottles of GP8 water for St. Michael’s fundraising events, including its golf tournament in 2012 – before he joined the hospital. Bottles of the water were in every golf cart, he said.
At another golf tournament for a charitable organization Mr. Georgiou was involved in, Mr. Brauti reminded Dr. Howard that he was part of the GP8 water team and rode in its golf cart.