Yellowknife (Apr 26/04) - The NWT Liquor Board is "in limbo" while an ethics counsellor looks into allegations that two Yellowknife bars received preferential treatment from the Justice Department.

Gordon Wray, a former MLA and part-owner of the Top Knight, told Deputy Minister of Justice DonCooper he was "incensed" with the board.

The Liquor Licensing Board has been without a permanent head since former chair John Simpson resigned roughly three weeks ago, citing a lack of support from within the Finance Department and problems with the entire liquor enforcement process.

"It would be my preference to have a chair appointed some time in the near future," said acting chair Liz Danielsen, of Norman Wells. "Things are kind of in limbo right now."

While board members wait for Finance Minister Floyd Roland to appoint a new chair -- nominations for the post closed on April 16 -- there have also been questions raised about the ability of liquor inspectors to keep tabs on the territories' bars.

Two inspectors in Yellowknife recently resigned and Department of Finance staff are trying to fill a third position in Fort Simpson.

There is currently one inspector each in Yellowknife, Inuvik, Fort Smith and Hay River.

Staff say that while three of the seven positions are open, the majority of liquor inspections are carried out by RCMP officers.

But while the RCMP do roughly five times as many inspectors as liquor enforcement officers, they rarely lay charges.

"There is a lot of work to do on the enforcement side," Danielsen said.

While the board still has the authority to meet and hear cases, Danielsen doesn't expect any charges to be brought forward until Finance Minister Floyd Roland appoints a new chair.

Still, Danielsen welcomed word last week that Premier Joe Handley has asked Ted Hughes, former NWT conflict commissioner and retired B.C. Supreme Court justice, to review allegations of interference regarding two cases brought before the board in February.

"I think it's a good thing. It will go a long way towards resolving some of the differences and inequities that exist," she said.

The issue came to a head recently when internal documents -- released under an access to information request -- showed Deputy Justice Minister Don Cooper became involved in the cases after speaking with a Yellowknife bar owner.

Department memos say Gordon Wray, a former MLA and part-owner of the Top Knight, told Cooper he was "incensed" with the board. Wray also expressed concern over upcoming hearings for another Yellowknife 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 while he believes there was no wrongdoing, it was important to have an independent review.

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

Hughes has presided over several high-profile public proceedings including an inquiry into the 1997 clash between protesters 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.

Handley said he spoke with Cooper and reviewed some of the internal e-mails 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."