Yellowknife (Apr 23/04) - An independent ethics counsellor has been appointed to look into allegations that two local bars may have benefitted from preferential treatment by the Justice Department during a series of liquor board hearings earlier this year.

Conflict of Interest Commissioner Ted Hughes

"We cannot continue to have the credibility of (high-ranking government officials) eroded," said Premier Joe Handley, Wednesday.

"It's necessary to have an impartial person come in and get to the bottom of this."

After meeting with Finance Minister Floyd Roland and Justice Minister Charles Dent, Handley announced that former B.C. Supreme Court Justice and NWT Conflict of Interest Commissioner Ted Hughes will investigate the allegations.

Hughes has presided over several high-profile public proceedings including an inquiry into the 1997 clash between protestors and police at the APEC summit in Vancouver.

"I have 100 per cent confidence in our people and have no doubt in my mind that they are good public servants. But we need someone objective to verify that." Handley said.

The premier said Hughes will be given access to stacks of internal Justice and Finance department documents and will have the authority to interview deputy ministers and cabinet members.

A spokesperson for the premier said Hughes has been asked to report "as expediently as possible."

Handley said the findings of his investigation would be made public.

The issue came to a head late last week when internal documents released to Yellowknifer under an access to information request outlined possible interference by Deputy Minister of Justice Don Cooper in two cases brought before the Liquor Licensing Board last February.

Department memos say Top Knight owner and former MLA Gordon Wray told Cooper he was "incensed" with the board. Wray also expressed concern over an upcoming hearing for and another downtown establishment, Le Frolic.

An e-mail from a high-ranking justice official said Cooper asked for a summary of the evidence against Le Frolic after speaking with Wray.

Another internal memo says the Justice department lawyer handling the case was originally looking to have Le Frolic's license suspended for 30 days because it was "one of the most serious cases" the lawyers had seen in a while.

But at the next hearing of the liquor board, about two weeks after Wray's conversation with Cooper, Le Frolic was offered a plea bargain: a one-day suspension of its license.

Handley said he had spoken with Cooper and reviewed some of the internal emails and documents surrounding the Top Knight and Le Frolic cases. He said that he didn't find any evidence that the deputy minister had overstepped his authority.

"I'm comfortable that he has acted appropriately. There's a difference between talking with bar owners and interfering in the process," Handley said. "That's where I would have concerns. But I saw no evidence of interference."

Questions were also raised about comments made by Finance Minister Floyd Roland shortly after liquor board chair John Simpson resigned in March, citing a lack of support from the Finance department.

In the Legislative Assembly, March 31, Roland said there had been no "red flags" raised before Simpson's resignation. But board members said they made their concerns known to Roland during a meeting at the Explorer Hotel on March 19.

Roland later said he didn't consider the issues raised during the meeting to be "critical."

Yellowknife Centre MLA Robert Hawkins, who wrote a letter to Roland, Tuesday, in favour of an independent investigation, said that while he doesn't believe senior officials acted inappropriately, the public's confidence in the system needs to be restored.

"The system has the appearance that it's rotting itself out," said Hawkins.

"We need to restore public credibility in the process."