Public funds: Schmidt borrowed $75,000, never paid back
by Kevin Weedmark
Court documents indicate that Hal Schmidt—the Sun Country Health Region vice-president of finance and corporate services—borrowed $75,000 from St. Mary’s Hospital in New Westminster, B.C. when he was CEO, and never repaid the loan.
When he missed the deadline to repay the loan, he was sued by the Fraser Health Authority. St. Mary’s Hospital had been closed down by that point and a forensic audit was ordered for the period Schmidt was CEO. A default judgement was issued by the B.C. Supreme Court against Schmidt in 2005 ordering him to pay $82,401.86 sought by the health authority, as well as $1,524.43 in interest and $2,215.44 for costs.
The judgement has not been collected and the debt is still outstanding.
Schmidt loaned himself $75,000 from St. Mary’s Hospital funds on April 27, 2001, when he was CEO of the hospital, and agreed to repay the principal plus interest by April 27, 2004. The World-Spectator reported earlier that Schmidt had investigated for improper use of his credit card and making personal loans to himself from hospital funds at St. Mary’s. Last week the World-Spectator obtained documents from the B.C. Supreme Court detailing the claim against Schmidt and the judgement against him.
The Fraser Health Authority filed a statement of claim against Schmidt in the British Columbia Supreme Court on Dec. 3, 2004.
As the World-Spectator has reported, Schmidt was fired from IWK Health Centre in Halifax in early 2004 for falsely claiming to be a chartered accountant. Despite dozens of newspaper reports at the time about his firing for falsely claiming to be a CA, Schmidt told the World-Spectator he had never claimed to be a CA.The World-Spectator received a copy of Schmidt’s CV showing that he did indeed claim to be a CA.
Sun Country board chair Sharon Bauche said she believes Schmidt’s explanation that he didn’t actually claim to be a CA.
Schmidt also claimed that there was no evidence of wrongdoing when he was CEO of St. Mary’s.
In a written statement issued June 9 defending himself, he wrote “The truth is I have never faced charges regarding the use of public funds. The libellous statements made in this package of information are not true. Furthermore, you can be sure that if the accusation had any truth to it, any responsible public official would have followed through quickly with an investigation and charges.”
According to the Statement of Claim filed by the Fraser Health Authority, “The defendant failed to repay the principal amount and accrued interest on or before April 27, 2004, as required by the loan agreement,”
Also according to the Statement of Claim, “By letter dated November 8, 2004, the Plaintiff provided the Defendant with notice of the Assignment and made demand upon the Defendant for the immediate repayment of $82,401.86. Notwishtstanding this notice and demand, the defendant has refused or neglected and continues to refuse and neglect to pay the amount owing.” Schmidt could not be located to be served notice of the claim, so a statement of claim was published in the Saturday, August 13, 2005 issue of the Vancouver Sun addressed “to Harold E. Schmidt, also known as Hal Schmidt, Defendant, last known address of 1051 Lee Street, White Rock, B.C.”
According to the legal notice, “the Plaintiff’s claim is for judgement in the amount of $82,401.86, interest and such other relief the Court may deem just in connection with a Loan Agreement entered into on or about April 27, 2001.”
A default judgement was issued by the court Sept. 19, 2005. The judgement states: “The defendant not having filed an appearance to the writ of summons in this action and the time for doing so having expired, this court orders that the defendant pay to the plaintiff the sum of $82,401.86, together with interest as claimed pursuant to the Court Orders Interest Act from Novermber 9, 2004 to September 16, 2005 in the amount of $1,524.43 and $2.215.44.”
Court records show that Schmidt filed a statement of defence in August 2006, a year after the judgement against him, but there is no copy of that statement of defence in the B.C. Supreme Court’s file on the case.
Fraser Health Authority spokesperson Joan Fraser told the World-Spectator last week that all she can say about the case is “this matter is unresolved.”
The World-Spectator has filed a Freedom of Information request with the British Columbia Health Ministry to uncover a copy of the forensic audit conducted into Schmidt’s tenure at St. Mary’s.