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Administrative Law - Licences

. D. Michael Goldlist v. Registrar, Alcohol, Cannabis and Gaming Regulations and Public Protection Act

In D. Michael Goldlist v. Registrar, Alcohol, Cannabis and Gaming Regulations and Public Protection Act (Div Ct, 2022) the Divisional Court considered the statutory licencing criteria of the Cannabis Licencing Act (which are similar to several other vice and quasi-criminal business licencing regimes), in the context of procedural fairness:
[55] This panel must determine whether the appropriate level of procedural fairness was afforded (Brooks v Ontario Racing Commission, 2017 ONCA 833 at para 5).

[56] We find that the record discloses no denial of procedural fairness. The Appellant had an opportunity to know the issues and respond to them.

[57] The Tribunal was alive to the potential impacts of the regulatory process on the appellant, and it fulfilled its obligations to safeguard procedural fairness in this case.

[58] Baker, at paragraph 24, explains that the level of procedural fairness owed is elevated when a decision is determinative of the issue, further requests cannot be submitted, and no appeal procedure is provided in the statute.

[59] The Appellant submits that he is owed greater procedural fairness because “the Decision arises from a statutory right of appeal and takes place in the form of a hearing de novo”.

[60] However, the Appellant exercised his right of appeal in having a hearing de novo before the LAT. He then had a right to request a reconsideration of the Tribunal’s Decision which finally disposes of an appeal as well as a right of appeal to this Court on questions of law.

[61] The Appellant was aware of the case he had to meet. During the hearing de novo, he raised new issues and produced new evidence. Submissions were made with respect to the totality of the evidence. The LAT properly considered and weighed the evidence and submissions.

[62] Baker, at paragraph 25, sets out that, in the context of employment, “a high standard of justice is required when the right to continue in one’s profession or employment is at stake…” In the Appellant case, however, has never been licensed, nor legally employed, as a CRM. As a result, the impact of this decision on the Appellant’s continued employment is minimal to non-existent. The Decision has little to no impact on the Appellant’s employment. The Tribunal decision does not impact his right to work or his future employment in the cannabis industry.

[63] There is also no evidence that the Appellant’s ability to work in the cannabis industry would be significantly impacted by the absence of a CRM licence. The Appellant testified at length that he has maintained continuous employment as an entrepreneur in the cannabis industry since 2004. Since then, he established and operated several businesses, including headshops that sell and distribute cannabis and smoking accessories. He gave evidence before the Tribunal, though, that a CRM licence would allow him to share and build upon his experience and knowledge in the cannabis industry.

[64] Nonetheless, a CRM licence will not prevent the Appellant from continuing in his career of working and owning headshops, selling and/or distributing cannabis accessories, sharing his knowledge or expanding upon his cannabis related knowledge. It also does not prevent the Appellant from being employed in an authorized retail cannabis store and assisting and educating customers on various cannabis products.

[65] The Decision only prevents the Appellant from supervising or managing employees of a cannabis store; overseeing or coordinating the sale of cannabis; managing compliance issues in relation to the sale of cannabis; and having signing authority to purchase cannabis, enter into contracts and make offers of employments.

[66] In addition, after a two-year period from his being denied a CRM licence, the Appellant is eligible to re-apply for one.

[67] The Act sets out the regulatory model for the responsible, safe and lawful sale of cannabis in Ontario. The Act aims to protect the public by requiring that retail sales are carried out with honesty, integrity, in accordance with the law and in the public interest. In the case of Sticky Nuggz Inc. v Alcohol and Gaming Commission of Ontario, 2020 ONSC 5916 at paragraph 67, this Court held that the adverse impacts of a refusal under the Act are extraneous considerations within that statutory objective.

[68] Finally, given that hearings before the LAT are hearing de novo, there was no legitimate or reasonable expectation that the Tribunal would not consider the totality of the evidence. The Tribunal is not limited to the particulars set out in the Proposal.

[69] The Appellant is presumed to know the law and understand that the task before the LAT involves a consideration of the totality of the Appellant’s past and present conduct.

[70] The Proposal put the Appellant’s honesty, integrity, and his ability to act in compliance with the law and the public interest squarely at issue. The Appellant was aware that the allegations in the Proposal involved, amongst other things, misrepresentations regarding the nature of his civil litigation and his involvement in the illegal cannabis dispensary. He also received disclosure related to these particulars before the hearing commenced.
. Toronto Quality Motors v. Registrar, Motor Vehicle Dealers Act

In Toronto Quality Motors v. Registrar, Motor Vehicle Dealers Act (Div Ct, 2022) the Divisional Court cited law respecting regulatory penalty appeals:
[20] With respect to the appeal from the disposition, it is well-established that in order to overturn a penalty or disposition imposed by a regulatory tribunal, an appellant must show that the decision-maker made an error in principle or that the penalty or disposition was “clearly unfit”: Mitelman v. College of Veterinarians of Ontario, 2020 ONSC 3039 (Div. Ct.) at para. 18.

[21] In the criminal law context, case law in relation to a similar appellate standard of review describes the threshold for appellate intervention as a requirement to show that a sentence is: “demonstrably unfit”, “clearly unreasonable”, “clearly or manifestly excessive”, “clearly excessive or inadequate”, or representing a “substantial and marked departure” from penalties in similar cases. This high threshold also applies in the administrative law context. To be clearly unfit, a penalty or disposition must be disproportionate or fall outside the range of penalties for similar offences in similar circumstances. A fit penalty is guided by an assessment of the facts of the particular case and the penalties imposed in other cases involving similar infractions and circumstances: College of Physicians and Surgeons v. Peirovy, 2018 ONCA 420 at paras. 56-57.

....

[24] The appellants submit that revocation was disproportionate when compared to another case that the appellants submit is similar, Premium Cars Wholesale Limited et al. v. Registrar, Motor Vehicle Dealers Act, 2020 CanLII 27360 (ON LAT). In Premium Cars a suspension was imposed.

[25] The high threshold for appellate intervention on penalty or disposition reflects that crafting an appropriate disposition is a very fact-dependent exercise. However, whether similar dispositions have been imposed in similar cases is one aspect of considering whether a disposition is “clearly unfit”. We agree with the respondent that the Premium Cars case is distinguishable from this case. In Premium Cars among the factors that led the tribunal to conclude that a suspension was appropriate was that in a number of cases where written disclosure of vehicle history was not provided, the tribunal found as a fact that customers were aware of the relevant vehicle history and were not misled: Premium Cars at paras. 280, 295. That is different than the finding in this case, where the tribunal found that the appellants engaged in a pattern of dishonest conduct towards consumers that involved manipulating unsophisticated and inexperienced customers, and undermined regulatory requirements fundamental to the protection of consumers. This court has upheld revocation as within the range of reasonable dispositions for conduct involving a pattern of dishonest transactions with consumers: 1855456 Ontario Inc. v. Registrar, Motor Vehicle Dealers Act, 2021 ONSC 2905 at paras. 12-14.
. Sobczyk v. Ontario

In Sobczyk v. Ontario (Div Ct, 2021) the Divisional Court considered a frequent ground of refusing a licence, ie. that there 'are reasonable grounds to believe that the Applicant will not comply with the Act and the regulations':
[30] Section 6(2)1 of O. Reg 247/14 provides that the Minister is not authorized to issue a registration certificate if there are reasonable grounds to believe that the Applicant will not comply with the Act and the regulations, based on information provided to the Minister and based on the past conduct of the Applicant or a related party. It was under this section that the Applicant’s application for renewal of his certificates was declined.

[31] The “reasonable grounds to believe” standard requires something more than mere suspicion, but less than the standard applicable in civil matters of proof on the balance of probabilities. In essence, reasonable grounds will exist where there is an objective basis for the belief which is based on compelling and credible information. [See Mugesera v. Canada (Minister of Citizenship and Immigration 2005 SCC 40 (CanLII), [2005] 2 S.C.R. 100 at para. 114].



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