Details

Written by: Gordon Prentice

Published: 17 June 2024

 Background: On 1 November 2022 the developer Michael Rice offered some of his newly purchased land in the Protected Greenbelt at Miller’s Sideroad and Bathurst in King Township to Southlake as the site of a new acute hospital. Rice bought the 2.78 sq km tract for $80M on 15 September 2022 from Bob Schickedanz, the former President of the Ontario Home Builders Association, gambling that he would be permitted – at some stage - to open it up for development. 

Michael Rice’s offer was made three days before the Government announced the removal of land from the Protected Greenbelt.

His presentation to the meeting on 1 November 2022 included the graphic (right) showing the Rice lands coloured yellow.

The Southlake logo straddles his land and the land immediately to the south owned by John Dunlap. He was the land agent who facilitated the Rice purchase.

Dunlap, then a member of Southlake’s Board, was a wealthy landowner in his own right with properties in Canada and the United States. 

Through his numbered company 2201506 Ontario - Dunlap owned 108 acres of land to the south, abutting the Rice lands. 

Conflict of Interest

Dunlap declared a conflict of interest at the Southlake Board meeting on 22 September 2022 and resigned from the Board.

The closed session minutes of the Board meeting say the conflict:

“related to the future site selection of the new build of a new hospital”.

The Board Meeting summary - which is available to the public on Southlake’s website - makes no mention of Dunlap’s conflict of interest or resignation from the Board. 

On 7 June 2024, Southlake stated it had no records of Dunlap offering to donate land so, if we take that at face value, the conflict of interest must relate to the Rice lands where Dunlap acted as the land agent and facilitator of the sale.

Dunlap was by trade a land agent but he wouldn’t have declared a conflict of interest to the Southlake Board for any old land sale he was involved in. This one was different.

Dunlap declared an interest because he knew by 22 September 2022 - seven days after Rice had purchased the Bathurst lands - that Rice was minded to offer land for a new hospital. If he didn’t know of Rice’s intentions then why declare a conflict of interest?

One Known Opportunity 

The first meeting of the Land Acquisition Sub Committee (LASC) on 5 December 2022 was told by its Chair, Southlake’s Vice President of Capital, Facilities and Business Development, John Marshman, that there was only "one known opportunity” - the Rice lands.  (see graphic right: 8 Known Opportunities)

Southlake’s then Chief Executive, Arden Krystal, attended Board meetings and would have been aware of Dunlap’s declaration of a conflict of interest on 22 September 2022 and that it related to the Rice lands. She must have told Marshman. How could she not? 

Marshman in the dark

Yet Southlake insists that John Marshman:

“learned about the Rice Group land during a meeting between Southlake, King Township and Rice Group on November 1, 2022.”

We are asked to believe that Marshman walked into the consequential meeting at King Municipal Centre on 1 November 2022 unaware that an offer of land was about to be made by Michael Rice and that he, Marshman, had no knowledge of Dunlap’s declaration of a conflict of interest on 22 September 2022 regarding the Rice lands. 

This is not credible. The resignation of a Board member – and their reasons - would have been a talking point among Southlake’s top-tier management.

Pellegrini and Dunlap’s offer of land

On 20 July 2020 Dunlap told King Mayor, Steve Pellegrini, that he was prepared to donate land to Southlake for a new hospital. He attached location maps. (Right)

“If you feel the idea has merit I will continue to work with Southlake on a donation process.”

In a handwritten postscript to his letter, Dunlap wrote:

“I thought this may be helpful for your meeting with Arden Krystal from Southlake.”

Pellegrini enthusiastically welcomed the prospect of a new hospital on the lands owned by Dunlap at Bathurst and Davis Drive West – most recently at the King Council meeting on 13 May 2024. 

Did Dunlap offer land to Southlake?

Despite this, Southlake insists it has no records of Dunlap ever offering to donate land for a new hospital.

I find it impossible to believe the top people at Southlake were unaware that Dunlap – a Board member – was minded to gift land for a new hospital. 

Even if Dunlap had made the offer to the Southlake Foundation – the hospital’s charitable arm – it is inconceivable this information would not have been passed to Southlake’s then Chief Executive, Arden Krystal, who sat on the Foundation Board. She had been the public face of Southlake’s search for a second site. She is on record saying she hoped for a benefactor.

When Arden Krystal met possible donors she didn’t take notes or jot things down. That wasn’t her way of doing things. Instead of an aide-memoire she committed everything to memory.

Memory Man

She shared this remarkable trait with Southlake’s Vice President of Capital, Facilities and Business Development, John Marshman, who had been in contact with the Rice Group about a possible new hospital site since January 2022.

Southlake has no records of the meeting on 1 November 2022 other than the invitations. However we know that the developer Michael Rice delivered a presentation which included a schematic showing, with the Southlake logo, the rough location of the proposed new hospital.

The Southlake logo straddled the Rice lands (shaded yellow) and those to the south owned by Dunlap. Before the meeting, Erin Lindsay, the Rice Group’s Vice President of Administration, sent the presentation to King’s Chief Administrative Officer Daniel Kostopolous asking if he was OK with it. He was. 

Hospital Location encroaches onto Dunlap lands

None of the meeting’s participants - including Arden Krystal and John Marshman – objected to the schematic as being inaccurate.

It clearly showed the Rice lands shaded in yellow and with the proposed hospital location significantly encroaching onto the neighbouring lands owned by Dunlap. 

Marshman committed everything from the one and a half hour meeting to memory. He states unequivocally: 

"I did not use any records from a meeting between Southlake, King Township, the Rice Group on November 1, 2022 in the December 5, 2022 presentation provided to Southlake’s Land Acquisition Sub Committee. To be clear, I unequivocally attest that I did not use any records provided during the 1 November 2022 meeting in the December 5, 2022 presentation to Southlake’s Land Acquisition Sub Committee.”

On 7 November 2022 Michael Rice wrote to John Marshman saying:

“We are ready to review concepts.”

And on 16 November 2022 Marshman met Michael Rice and Erin Lindsay (the Rice Group’s Vice President of Administration) at the Rice HQ in Markham.

Marshman’s schematic

Almost three weeks later, on 5 December 2022, Marshman’s presentation to the first meeting of Southlake’s newly formed Land Acquisition Sub Committee (LASC) also included a schematic showing the rough location of the proposed hospital. It mimicked the Rice presentation slide but in his version the Rice lands were not colour coded or identified in any way. And, again, the proposed site clearly straddled the Rice/Dunlap lands.

Unless they had been told otherwise, members of the LASC would have assumed the proposed hospital site was on Rice lands. If Dunlap had never offered his own land to Southlake then why include his lands in the schematic?

If Marshman made a mistake about the proposed location of the hospital he should simply say so. He made a giant error and got it wrong. 

No records

Southlake maintains it has no records for a number of important meetings where the location of the proposed hospital was being considered. They either don’t exist or, if they do, they are saved from disclosure (a) to protect the economic interests of Ontario or (b) to protect the interests of third parties (that is, entities separate from Southlake but who contract with it.)

We are are told, for example, there are no records of the meeting on 24 January 2023 involving Mayor Pellegrini, Krystal and Marshman which was a “follow-up” to the critically important one on 1 November 2022. We have the invitation list but nothing more. 

In the same way, we are told there are no records of the 16 January 2023 meeting (other than the invitation list) which was specifically convened to discuss the “Bathurst Davis Drive Opportunity”. The meeting involving architects, planners and facilities experts was chaired by John Marshman and considered the location of the proposed acute hospital; how and where a new Long Term Care facility would fit in and if a Ministerial Zoning Order would be required. 

John Marshman would know that public bodies – including hospitals – have a legal obligation to keep records. 

But if, for whatever reason, they choose not to keep records they should tell us what they know.

Having no records is not the same as having no knowledge.

For a start we should be told if the Land Acquisition Sub Committee was given inaccurate information on where the new Southlake was planned to be located together with an explanation on how and why that happened.

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