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Administrative - Enforcement. Poonian v. British Columbia (Securities Commission)
In Poonian v. British Columbia (Securities Commission) (SCC, 2024) the Supreme Court of Canada considered whether the registration of a tribunal order in a court for enforcement is 'imposed by a court', with in meaning of the BIA:[49] The effect of an administrative decision being registered with a court is that the creditor is able to use civil methods to enforce the decision as if it were a judgment of that court. The registration of the decision does not change the fact that it was made and imposed by an administrative decision maker, nor does it overcome the BIA’s requirement that the exempt debt be imposed by a court (C.A. reasons, at para. 48; Hennig (C.A.), at para. 52). When a decision is registered with a court, the court’s involvement is passive, whereas the act of “imposing” a fine, penalty, restitution order or other order similar in nature requires that the court be actively involved in making the decision (see Hennig (C.A.), at para. 52).
[50] Justice Willcock correctly concluded in this case that s. 178(1)(a) “is broad enough to include at least fines, penalties and restitution orders imposed by courts other than the superior courts of the provinces, but cannot be read so broadly as to include fines imposed by tribunals that are registered in a court” (para. 44). . MGW Homes Design Inc. v. Pasqualino
In MGW Homes Design Inc. v. Pasqualino (Div Court, 2024) the Divisional Court allows a JR from an order that apparently permanently voided Construction Act s.13.20 adjudication determination court enforcement steps, here for failure to give notice of this step to the respondent [under CA s.13.20(3)].
The court took the oppourtunity to clarify the status of "sub-judicial decisions" (which I am treating as 'administrative' decisions), filed with courts for enforcement:(a) Enforcement by Court Order is not an “Extraordinary Power”
[14] Many sub-judicial decisions may be enforced by court order. These include arbitral decisions (see Arbitration Act, SO 1991, c. 17, s. 50), administrative decisions (see Statutory Powers and Procedures Act, RSO 1990, c. S.22 (“SPPA”), s.19 and Labour Relations Act, 1995, SO 1995, c. 1, Sch. A, s. 19) and references directed by a court: R. 54 of the Rules of Civil Procedure. The manner in which sub-judicial decisions may be enforced is prescribed in the applicable legislation. One enforcement process is a motion, on notice, for a court order: see, for example, Arbitration Act, s. 50. Reference decisions (including references under the Construction Act) are confirmed automatically and thereby become enforceable as court orders unless a party moves before a judge opposing confirmation of the referee’s report: R. 54.09.
[15] The Legislature’s choice of enforcement procedures determines what is required in a particular circumstance. The provisions at issue in this case are new, but they are a variation on an established range of processes to enforce sub-judicial decisions by court orders, a necessary and common feature of arbitral and administrative decision-making. These provisions are not an “extraordinary power” but rather a necessary feature of the Construction Act adjudication process and should be read within that context. They follow the general Ontario model for enforcement of administrative decisions prescribed in s. 19 of the SPPA.
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[17] The Legislature provided for more expeditious enforcement of Construction Act prompt payment determinations than in respect to some other sub-judicial decisions. The enforcing party does not need to bring a motion on notice. There is no option for a disappointed party to move to oppose enforcement of the payment order. A party may take an adjudicator’s determination to a court office, file it, and thereupon enforce it, all without notice to the other side. Subsection 13.20(1) of the Act provides:A party to an adjudication may… file a certified copy of the determination of an adjudicator with the court and, on filing, the determination is enforceable as if it were an order of the court. Subsection 13.20(3) of the Act states:A party shall, no later than 10 days after filing a determination under subsection (1), notify the other party of the filing. The order is enforceable “on filing” and notice is to be given “no later than 10 days after filing.” On the plain language of these provisions, enforcement may begin before notice is given. The Act is silent on what happens if notice is not given pursuant to s.13.20(3). . College of Physicians and Surgeons of Ontario v. Kilian
In College of Physicians and Surgeons of Ontario v. Kilian (Ont CA, 2023) the Court of Appeal considers an appeal of an HPPC/RHPA enforcement court order [under HPPC s.87] "requiring her to comply with the College of Physicians and Surgeons of Ontario’s (the “College”) investigation into her conduct", here where the appellant argued that they should have been allowed to argue the main substantive issues in the case in this HPPC s.87 procedure:Court orders
87 The College may apply to the Superior Court of Justice for an order directing a person to comply with a provision of the health profession Act, this Code, the Regulated Health Professions Act, 1991, the regulations under those Acts or the by-laws made under clause 94 (1) (l.2), (l.3) (s), (t), (t.1), (t.2), (v), (w) or (y). In these quotes, the court considers the extent to which the application court could consider the merits of the underlying S.87-triggering statutory violation [here, HPPC 76(3) ['Obstruction prohibited'] and 76(3.1) ['Member to co-operate']:[12] The application judge held that all that is required on a s. 87 application is for the College to show that there was a breach of the statute, i.e., the Code, and that the statute permits the court to make the order against Dr. Kilian. He noted that the purpose of an investigation is to compel a non-cooperating physician to comply with their statutory obligations in an ongoing College investigation. The scope of review on a s. 87 application is therefore limited.
[13] The application judge held that issues relating to the constitutionality of the legislation or its application, and issues relating to the legitimacy of the investigation, or the investigators’ actions, should be reviewed by the College’s Discipline Committee at first instance, not the court on a s. 87 application.
[14] As such, he declined to consider the merits of the investigation and rejected Dr. Kilian’s argument that the College was required to prove the legality of the underlying investigation before the court could require her to produce the records.
[15] The application judge held that the requirements for issuance of a s. 87 order had been met. Dr. Kilian did not cooperate with the investigation, in breach of s. 76 of the Code. Furthermore, the records were within the terms of the investigation, were relevant to the assessment of Dr. Kilian’s conduct, and Dr. Kilian offered no legitimate reason for her refusal to cooperate.
[16] The application judge refused to exercise his discretion not to order Dr. Kilian’s compliance because, among other things, he found there was no reason to depart from the scope of discretion available on a s. 87 application, there were no legitimate privacy concerns regarding the patients, and Dr. Kilian had contributed to extensive and unreasonable delay in the proceedings.
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[21] A s. 87 application is brought to compel a non-cooperating doctor to comply with their statutory obligations in an ongoing College investigation. The application will be granted where “there has been a continued breach of the statute by the person against whom the injunction is sought and [where] the statute permits the Court to make an order against that person”: College of Physicians and Surgeons v. Ravikovich, 2010 ONSC 5714, at para. 10.
[22] The scope of review by the court on a s. 87 application is limited. The role of the court in the context of a s. 87 application to enforce compliance with s. 76 of the Code is to consider “whether the requests for information that the investigators have made are within the scope of their investigatory powers”: Kilian v. CPSO, 2023 ONSC 5, 11 Admin L.R. (7th) 89 (Div. Ct.), at para. 58.
[23] As noted by the Divisional Court in Kilian, at para. 53, “breach of the legislation will be established the moment that the [College] can demonstrate to the Court that Dr. Kilian was the subject of an investigation and was not cooperating with the investigation.”[1] There was a novel important passage [paras 19-39] ["I. Whether the Application Judge Erred in Finding He Did Not Have Jurisdiction to Consider Arguments Relating to the Lawfulness of the s. 76 Demand and the Constitutional Arguments"], which relate to the odd status of HPPC s.87, which can perhaps be best described as an 'administrative enforcement court order' (almost like a contempt order). When an HPPC s.87 court application was sought by the CPSO, the appellant - finding themselves suddenly in the Superior Court - perhaps felt free to argue the larger substantive merits of the case (eg. constitutional, 'real and probable grounds') - but they were shut down on this by the application judge. In denying this ground of appeal, the appeal court alluded to the prematurity [Volochay] doctrine that one cannot generally review (appeal or judicial review) administrative matters until they are 'final'. This leaves us with the logical conclusion that this HPPC s.87 court procedure was still 'administrative', coming on early in these investigative CPSO proceeding as it did - not even yet at a Tribunal stage:[27] Dr. Kilian’s position demonstrates a misunderstanding of the purpose of a s. 87 application and the regulatory context in which it is situated.
[28] The Divisional Court in Kilian correctly noted, at para. 51, that a s. 87 application occurs within the context of an ongoing administrative process. There is a long-standing principle not to interfere in an ongoing administrative process until it is complete, absent exceptional circumstances: Ontario College of Art v. Ontario (Human Rights Commission) (1993), 1993 CanLII 3430 (ON SCDC), 11 O.R. (3d) 798 (Div. Ct.); Ravikovich v. College of Physicians and Surgeons, 2010 ONSC 5194 (Div. Ct.), at para. 4; Volochay v. College of Massage Therapists of Ontario, 2012 ONCA 541, 111. O.R. (3d) 561, at paras. 68-69.
[29] There are legitimate policy reasons for this principle. As described by this court in Volochay, at para. 69, quoting Stratas J.A. in C.B. Powell Limited v. Canada (Border Services Agency), 2010 FCA 61, [2011] 2 F.C.R. 332, at para. 42:This prevents fragmentation of the administrative process and piecemeal court proceedings, eliminates the large costs and delays associated with premature forays to court and avoids the waste associated with hearing an interlocutory judicial review when the applicant for judicial review may succeed at the end of the administrative process anyway. Further, only at the end of the administrative process will a reviewing court have all of the administrative decision-maker’s findings; these findings may be suffused with expertise, legitimate policy judgments and valuable regulatory experience. Finally, this approach is consistent with and supports the concept of judicial respect for administrative decision-makers who, like judges, have decision-making responsibilities to discharge. [Citations omitted.] ....
[36] The Discipline Committee has the power to grant remedies pursuant to s. 24 of the Charter and can decline to apply legislation where it determines the legislation is unconstitutional: Okwuobi v. Lester B. Pearson School Board; Casimir v. Quebec (Attorney General); Zorilla v. Quebec (Attorney General), 2005 SCC 16, [2005] 1 S.C.R. 257, at paras. 44-45. It is also the proper forum for a party to challenge the appointment of an investigator, the lawfulness of a s. 76 demand and any alleged violation of Dr. Kilian’s individual rights: Kilian, at para. 50.
[37] After the administrative process is complete, Dr. Kilian can then challenge the outcome of the administrative process through judicial review to the Divisional Court: Judicial Review Procedure Act, R.S.O. 1990, c. J.1, ss. 1, 2, and 6(1). To allow her to do so now before the investigation is complete would be premature: Dioguardi Tax Law v. The Law Society of Upper Canada, 2015 ONSC 3430, 337 C.R.R. (2d) 101, aff’d 2016 ONCA 531, 133 O.R. (3d) 151, leave to appeal refused, [2016] S.C.C.A. No. 407.
[38] For these reasons, we find the College did not need to prove its demand for production of documents was lawful before making the order. As such, the first ground of appeal fails.
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[42] As the application judge succinctly stated:The [College] has established grounds for a s. 87 order. The request made by the investigator for the records he sought was a proper one given the terms of the investigation ordered by the [College]. The records sought are relevant to the relatively broad terms of his appointment to assess the Respondent’s conduct concerning the COVID-19 pandemic. The Respondent is indisputably refusing to cooperate [by providing the requested medical records] and has not established any legitimate reason for doing so. . Binance Holdings Limited v. Ontario Securities Commission
In Binance Holdings Limited v. Ontario Securities Commission (Div Court, 2023) the Divisional Court considered a JR against a Capital Markets Tribunal (CMT) decision that it lacked jurisdiction to order the revocation of an "(i)nvestigation Order under s. 144(1) of the Securities Act" (which was initiated "under s. 11(1)(a) of the Securities Act, R.S.O. 1990, c. S.5").
In these quotes, the court considers whether an enforcement 'undertaking', negotiated between the OSC and the JR applicant (and entered into before the CMT investigation order) operated to bar such an order. Under the specific terms of the undertaking in this case it didn't bar statutory orders, but these passages are an interesting illustration of how 'undertakings' in this situation are essentially treated as a settlement contract as an enforcement technique:(1) Whether the Investigation Order and Summons are foreclosed by the Undertaking
[34] Binance describes the Undertaking as a settlement and submits that, due to its terms, the OSC cannot pursue the investigation. In turn, Binance submits as follows:(i) that the Investigation Order is an abuse of process and is also precluded by issue estoppel; and,
(ii) that the monitoring terms of the Undertaking do not permit the investigation. [35] If the Investigation Order should be quashed, as submitted by Binance, the Summons issued under it must also be quashed.
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[39] Binance submits that it would be manifestly unfair and contrary to the interests of justice to permit the investigation to proceed given the agreement made in the Undertaking. An ample record has been put forward regarding the events surrounding the making of the Undertaking and steps taken under it.
[40] The issues raised by Binance relate to the wording of the Undertaking, and whether or not it precludes the Investigation Order. Binance’s characterization of the Undertaking as a “settlement” does not materially change the analysis. If the Undertaking precludes the Investigation Order, the Order should be quashed in this case.
[41] The Undertaking has an express reservation of rights. In the Undertaking, the OSC and OSC Staff expressly retained “the right to bring enforcement proceedings or seek temporary orders” “for any past, present or future conduct contrary to the Act or the public interest”, with an exception. This reservation of rights is obviously broad. Binance must show that the Investigation Order falls within the exception.
[42] The exception precludes enforcement proceedings or temporary orders “arising from the facts set out …in the ‘Facts’ section” of the Undertaking so long as Binance “remains in compliance with the Undertaking and, has not made any misrepresentations to Staff in respect of the Undertaking”. In addition, the Undertaking provides “for certainty” that the OSC and OSC Staff may bring enforcement proceedings or seek temporary orders for “any breach” of the Undertaking or “any misrepresentation made to OSC Staff” in respect of the Undertaking.
[43] Binance submits that the Investigation Order does arise from the facts set out in the “Facts” section of the Undertaking. Paragraph 1 of the Investigation Order sets out a lengthy series of statements. There is an overlap between those statements and the “Facts” in the Undertaking. However, paragraph 1 must be read in its entirety. It set out a chronology of events and went well beyond the overlap include material matters. Paragraph 1 included, for example, these statements of fact that do not form part of the “Facts” section of the Undertaking:(i) that Binance operated and continues to operate the crypto currency trading platform [website] through which it offers clients the ability to trade in products that include crypto assets, instruments and contracts, described as Security Tokens and Crypto Contracts;
(ii) that Ontarians traded Security Tokens and Crypto Contracts on the Binance trading platform and, since the Undertaking was given, the Binance trading platform continued to have a significant presence in Ontario;
(iii) that Binance had never been registered with the OSC, had no exemption from registration, had not filed a prospectus, and had no exemption from the prospectus requirement; and,
(iv) that on March 27, 2023, the CFTC Complaint was filed again Binance and others, including allegations that Binance and others had taken steps to circumvent U.S. regulatory requirements and relevant compliance controls. [44] Reading the entirety of paragraph 1, along with the entirety of the Undertaking, we do not conclude that the Undertaking precludes the Investigation Order because of the overlap relied upon by Binance. The statements of fact in the Investigation Order go well beyond and include that above serious factual statements, giving rise the investigation.
[45] Further, even that part of the exception to the reservation of rights in the Undertaking did apply, it must be read along with the rest of the exception to the reservation of rights. The exception also does not apply where Binance has made a misrepresentation to Staff in relation to the Undertaking. The Investigation Order includes an allegation that Binance has made misleading statements to the OSC.
[46] Binance submits that this Court should have regard for evidence about the circumstances surrounding the Undertaking in interpreting the Undertaking. That evidence includes, for example, the draft notice of application for a cease trading order and dialogue with OSC Staff. The OSC disagrees. We find, as submitted by the OSC, that the Undertaking is clear and that, in any event, the surrounding circumstances support the OSC’s position on interpretation.
[47] Binance further submits that the reporting requirements in the Undertaking were intended to be comprehensive, precluding any additional monitoring mechanisms such as the Investigation Order or the Summons. Again, the words of Undertaking and its reservation of rights do not support this submission.
[48] The Undertaking contains an express, broad, reservation of rights, under which the OSC retained the right to bring enforcement proceedings for any past, present or future conduct contrary to the Act or the public interest. The exception to that reservation does not apply here. Binance has not shown that the Investigation Order is precluded by the Undertaking, let alone that it is an abuse of process.
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[50] The Investigation Order will therefore not be quashed. ...
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