LIQUOR LICENCE ACT, R.S.O. 1990

In the Matter of: SOLID GOLD ADULT ENTERTAINMENT

398 Clarence Street

London, Ontario

N6A 3M7

Licensee: Darchris Productions Inc.

Licence Number: 92427

Notice of Proposal: To REVOKE a licence

Dated April 17, 2007

The Proposal alleges that:

I. With respect to section 6 of the Act:

(a) contrary to clause 6 (2)(d) of the Liquor Licence Act,

the past/present conduct of the licence holder or if a corporation the present/past conduct of its officers or directors, or of a shareholder who owns or controls 10% or more of its equity shares, or of a person having beneficial interest in the business of the licence holder; or of a person having responsibility for the management or operation of the business of the licence holder affords reasonable grounds for belief that its business will not be carried on in accordance with the law and with integrity and honesty

II. With respect to contraventions of the Liquor Licence

Act, and Regulations thereto:

(b) contrary to subsection 45(1) of Ontario Regulation

719/90 under the Liquor Licence Act, the licence

holder permitted drunkenness or riotous, quarrelsome,

violent or disorderly conduct to occur on the licensed

premises or in the areas under the control of the licence

holder.

(c) contrary to subsection 45 (1) of the Liquor Licence Act,

the licence holder obstructed a person carrying out an

inspection under the Act.

(d) contrary to subsection 45(2) of the Liquor Licence Act,

the licence holder failed to facilitate an inspection

relevant to the licence.

Hearing: Station Park All Suite Hotel

242 Pall Mall Street,

London, Ontario

May 1 and 2, 2007

Presiding

Board Members: David C. Gavsie, Chair

Guy Maurice, Member

Appearances: Richard Kulis, Representative of the Registrar

Jeffrey Lyons, Representative of the Licensee

A hearing of the Alcohol and Gaming Commission of Ontario (“AGCO”) was held on May 1 and 2, 2007 in London, Ontario regarding:

a) an Interim Suspension Order of the Registrar dated April 17, 2007 (the “ISO”); and

b) a Notice of Proposal to Revoke a Licence issued by the Registrar on April 17, 2007 (the “NOP”),

both issued with respect to the liquor licence of Darchris Productions Inc. operating as Solid Gold Adult Entertainment (the “Licensee”), 398 Clarence Street, London, Ontario, (the “Premises”), licence no. 0092427 (the “Licence”).

At the conclusion of the hearing, the Board ORDERED that the ISO remain in effect until the Board rendered its decision, which was taken under reserve.

It was agreed between the parties at the hearing that if, in the Board decision, a finding or findings were made against the Licensee, submissions as to sanction would be made by representatives for the parties by telephone conference call.

1. PRELIMINARY MATTER

The exclusion of witnesses from the hearing room was requested and so ordered by the Board.

2. REGISTRAR’S EVIDENCE

a) Constable Trevor Pitts

Const. Pitts had been a member of the London Police Services (“LPS”) for approximately 13 ½ years. He is familiar with the Premises and was there early Saturday morning April 15, 2007. He had notes and a statement or report prepared by him. On consent he was permitted to refer to his notes and report to refresh his memory.

That night he was on patrol in downtown London with his partner, Const. James Dean. They were dispatched to the Premises at 00:53 due to an apparent assault by staff. On arrival, Const. Pitts spoke to a person in the back of an ambulance, and another person outside the back of the ambulance who was a friend of the person inside the ambulance. Both told Const. Pitts they had been in the Premises with a female companion and that the disc jockey had made comments to the female and that the 2 men and the disc jockey had made gestures to each other. The 2 men and the female were asked by staff to leave through the Clarence Street door. While exiting the Premises, the disc jockey ran up to them and punched the person who was interviewed in the ambulance in the back of the head. His friend had punched the disc jockey, but was then dragged inside the Premises, held on the floor and struck by a bar stool and punched. An ambulance was called for both patrons and the police were called.

A description of the disc jockey was given to Const. Pitts. He was described as being a big guy, black, short hair, wearing a muscle or tank top shirt. Const. Pitts then spoke to an independent witness who had been in the Premises and who told Const. Pitts he saw the second male get hit by a chair or stool.

Const. Pitts entered the Premises to search for the disc jockey. He noticed one of the staff was a black male. This male was wearing black. It was a Solid Gold shirt. The police officer took this male into the foyer and asked him if he was involved in the fight. The male did not answer directly to the question; he was not forthcoming and was causing a commotion. The police asked the male who else was working. The police later found the male’s name to be Jason Hiieuvins.

Const. Pitts then went to the disc jockey or DJ booth. There were 2 females inside. Leigh Fader was one. She told Const. Dean that the male disc jockey had gone and that she was now the disc jockey. Mr. Hiieuvins was still being uncooperative and arguing as to why he had to furnish identification to Const. Pitts. Ultimately, however, he did and eventually calmed down.

Const. Pitts returned to the DJ booth with the male manager of the Premises who he described as tall and slim, approximately 6’3”, with a stubble beard. There was a male now inside the DJ booth. The male had a cut on his lip. He was identified as Marcus Cornelisse with an address on Central Avenue in London. Mr. Cornelisse told Const. Pitts that there had been an altercation at the Clarence Street door. Staff was involved. Mr. Cornelisse said he was punched in the mouth, and came back to the DJ booth. He was evasive, confrontational, and not forthcoming in giving his evidence.

Const. Pitts went back outside to speak to the 2 male patrons but they had left. The independent witness was still there and gave police a description fitting that of the disc jockey – big guy, wearing a tank top, short hair.

Const. Pitts described the Premises as being at the corner of Clarence and Dundas Streets. Clarence runs north-south: Dundas runs east-west. The entrance to the Premises is from Clarence Street. There is an exit only door on Dundas Street.

The 2 officers re-entered the Premises through the entrance on Clarence Street. There was a commotion on the dance floor. 2 males were fighting. There was no bar staff near them. The males were fighting on the floor. The officers handcuffed the males and took them to the foyer area on the Dundas Street door. They determined it was a fight out of posturing. A door staff member pointed out the instigator who left. The other male returned to his seat. Const. Pitts said no charges were laid. This took place about 30 to 40 minutes after they had first entered the Premises.

Const. Pitts with Const. Dean then proceeded to the DJ booth. The male manager was with them. Mr. Cornelisse and Jason Hiieuvins were there, as was Leigh Fader and another person. The DJ booth was described as being 6 or 7 feet by 10 feet, so it is a small space. The police asked Mr. Cornelisse if someone could take over his duties so he could go with the officers to a quieter place. Mr. Cornelisse replied no other person could do so. The officers suggested Ms. Fader could, but Mr. Cornelisse said no to that.

In response to questions from the police, Mr. Cornelisse said he did not hit anyone. He said he went down to the place where the altercation was happening to help the door staff. He said he could not make a fist with his right hand. Const. Pitt saw scar marks on it.

Mr. Cornelisse started getting agitated and was getting into Const. Dean’s face. He was asked to step back. Mr. Cornelisse was holding a drink in a tumbler glass in his hand. Const. Dean said to him “Let’s go to the police station.” Mr. Cornelisse put down his drink, said he was going nowhere, lunged at Const. Dean with a raised fist, and punched him. Const. Dean, who had been standing to Const. Pitt’s left, stumbled back. Const. Pitts tried to grab Mr. Cornelisse, and Mr. Cornelisse swung at him, with his closed right hand striking Const. Pitts on the left side of his head. Mr. Cornelisse pushed Const. Pitts with his left hand and Const. Pitts fell onto his back. He attempted to get up but Mr. Cornelisse stomped with his shoe or boot on the left side of Const. Pitt’s head.

Const. Pitts was stunned. He rolled to his right to pull out his gun. Mr. Cornelisse continued to kick Const. Pitts 5 to 7 times on his left side while on the floor.

Const. Pitts said that Jason Hiieuvins grabbed onto Mr. Cornelisse to pull him away. Const. Pitts withdrew his weapon from its holster. He attempted to use his radio to call for Code 1 assistance but it had been knocked loose. Const. Pitts stood up.

Const. Dean had also drawn his weapon. Mr. Cornelisse bolted out of the DJ booth, ran through the Premises and out the exit doors onto Dundas Street. The police officers chased him and went out the same doors. Mr. Cornelisse was not in sight. However, he appeared behind the opened exit door where he had been hiding. Mr. Cornelisse re-entered the Premises through the exit doors and closed them shut. The doors could not be opened from the outside. Const. Dean stayed outside those doors. Const. Pitts ran around to the front entrance door to the Premises on Clarence Street. He used his radio to call for assistance. He noticed it was 1:56 a.m.

The front doors were locked but Const. Pitts opened them by pulling hard. He entered the bar, saw the manager, and asked him where Marcus was. The manager replied “Who is Marcus?” So Const. Pitts asked him where the disc jockey was. The manager replied he did not know him.

Other police officers began arriving, and despite searching the Premises and even the roof, the police could not find either Mr. Cornelisse or Leigh Fader. The manager went to his office. Const. Pitts noticed a video surveillance system with a monitor and asked the manager for a copy of the tape from 12:30 a.m. on that morning. The manager said he knew nothing about the system and that police would have to speak to the day-time manager for that.

Police officers tried to locate Mr. Cornelisse that night but could not. 2 days later he turned himself in and was charged with 3 counts of assaulting police. Const. Pitts said that the original altercation involving the 2 males is still under investigation and no charges have yet been laid.

Const. Pitts stated that Mr. Cornelisse was big, about 6’3” tall, weighing around 280 to 290 pounds, and very muscular.

Const. Pitts estimated he and Const. Dean were in the DJ booth with Mr. Cornelisse and the others for 5 or 6 minutes before Mr. Cornelisse hit him. During that time, Leigh Fader was asked to leave because she was interrupting. Const. Pitts also said that from the first punch to Const. Deans until the time Mr. Cornelisse was pulled off of Const. Pitts, 45 seconds to a minute had elapsed. Const. Pitts said no one told Mr. Cornelisse he was under arrest, or even being charged before he lashed out. He just snapped.

On cross-examination, Const. Pitts indicated he had dealt with Mr. Cornelisse once before on a traffic stop. On the night of April 14/15, 2007, Const. Pitts had a police cruiser and was in full uniform. At one point, he did check Mr. Cornelisse on CPIC and noted past charges. These were not raised at all in the DJ’s booth.

Const. Pitts stated that he and Const. Dean arrived at 12:53 a.m. There were 2 men at the ambulance. One person was sitting inside the back of the ambulance and one was standing outside. The one outside had been drinking alcohol. He was holding an ice pack to his face. A female was also there. She had not been drinking.

The man in the ambulance had a bandage around his head. Neither male looked like a body builder. Mr. Cornelisse did.

Const. Pitts said the Premises were not packed. There were about 50 or 60 people inside. He had been in the Premises before conducting a walk through inspection. He could not say if there were any problems arising from his inspections.

Const. Pitts said that the first altercation started when the female companion of the 2 injured men was on stage getting money from patrons. The disc jockey started making comments about her. Someone gave the finger to the disc jockey and staff came over to ask that person to leave. He and a friend did and made their way towards the Clarence Street door. Staff said there was a commotion. Jason Hiieuvins was involved in removing them.

Const. Pitts said Mr. Cornelisse told him he had been at the club for 13 years and had never been involved in an assault.

On re-direct, Const. Pitts said he was just under 5’10” tall, and that Const. Dean was slightly taller.

b) Constable James Dean

Const. Dean has been a member of the LPS for over 15 years. He is familiar with the Premises and was there in the early morning of April 15, 2007. He made notes, and on consent, was allowed to use them to refresh his memory.

He and his partner, Const. Pitts started their shift at 11:45 p.m. on the night of April 14 and it was to go to 07:45 the next morning. Their patrol area covered the downtown bars. At 12:53 a.m. they received instructions to see a male outside the Premises. On arrival, an ambulance was at the scene. They parked on the east side of Clarence Street. A male was inside the ambulance being treated. Another male was outside the back of the ambulance holding an ice pack to his head. The male inside was named Wesley. He had a laceration to his left eyebrow area requiring stitches. His head was bandaged. He was going to the hospital. The male outside the ambulance was named Gord. He had a severe injury to his right cheek area. It was swollen and badly bruised. He had been struck. Const. Pitts spoke to him. Const. Dean spoke to Wesley.

Wesley and Gord had been together inside the Premises and had been asked to leave. Words had been exchanged between Gord and the disc jockey. As they were leaving, at the Clarence Street door, one employee struck Wesley with his fist on the left eyebrow cutting it. It was unprovoked as they were leaving. This story was corroborated by the girlfriends of both parties and also an independent witness. The independent witness gave Const. Dean a description of the employee who had punched Wesley. According to the independent witness, Gord was leaving with Wesley and after Wesley was struck, Gord was dragged back into the bar by bar staff. He was taken around the corner to a back bar area where he was struck with a stool on the right side of his face.

Const Dean was advised that this occurred as a result of retaliation for Gord having given the finger to the disc jockey who he had said had exchanged words with Gord.

Constables Pitts and Dean went back into the bar. They had a description, one consistent of which was that one of the bouncers was a black male, shorter, but husky. This male was not the one who had struck either Wesley or Gord. The Constables attempted to identify the party and began a walk-through in the premises. Near the front, they observed a male who fit the description, Jason Hiieuvins. He was a black male, dressed in black, and wearing the attire of a bouncer who worked in the Premises. He was wearing a black button-up shirt with black slacks. It was clear to the Constables that Mr. Hiieuvins was the male described by the witnesses. The Constables spoke to Mr. Hiieuvins who was hesitant to give them any information. He did say he was involved in removing the parties but claimed that he saw nothing by way of a commotion. Mr. Hiieuvins indicated that the two male patrons were in fact asked to leave. Const. Dean told Mr. Hiieuvins what he was investigating and why he had interest in Mr. Hiieuvins in that he was told Mr. Hiieuvins was present, but did not participate in the assault. Mr. Hiieuvins said he was protecting his interest and did not want to say much. He did indicate that he was present for all three assaults, and said that the disc jockey was the male involved in the assaults. Mr. Hiieuvins was hesitant to cooperate.

Const. Dean met with Const. Pitts who had been in the DJ booth. Const. Pitts told him that on his arrival at the DJ booth, a female operating the equipment in the booth had said that the disc jockey had left. Another male had attended the booth and was doing the disc jockey’s duties. It was unclear if the second male was working throughout the evening. The second male was named Marcus. Const. Dean noted he was large, husky, and wearing a blue zip-up jogging jacket. This contradicted some witness reports who said that the male causing the assaults was wearing black.

Constables Pitts and Dean realized that neither was satisfied that they had the person who conducted the assaults. They therefore went outside to their vehicle to conduct a check on Marcus, who’s real name was Marcus Cornelisse. In performing a CPIC check, they noted that Mr. Cornelisse had a lengthy record and a number of incidents involving violence. They returned to the Premises to speak to Mr. Cornelisse to find out if in fact he was the disc jockey involved in the assaults.

On entry, they spoke to a manager to whom Const. Pitts had spoken earlier. They asked the manager if there was another disc jockey available. The manager replied in the negative. The officers then asked the manager to accompany them to the DJ booth. As they were talking with the manager, in front of the stage, a fight broke out between two patrons. Both patrons ended up on the ground. Others were cheering them on. No security or door staff from the Premises was approaching the fight. As a result, Const Pitts and Dean intervened. They stopped the fight, removed the two males to the front vestibule. The aggressor was sent out the front door. The other was let back in. No staff at any time was present while the fight was going on or while the officers were in the vestibule with the two combatants.

Const Dean and Const Pitts, with the manager, went to the DJ booth to speak with Mr. Cornelisse specifically and ask him questions with regard to the earlier assault involving Wesley and Gord. The DJ booth was very small; it was perhaps 8 or 10 feet wide by 7 or 8 feet long. It was 2 steps up from the main floor. There was an open door to go through to get into the booth. At the back of the booth there was another door which leads to an access stairwell up to a small landing.

When the witness arrived at the DJ booth, Leigh Fader, later identified as Mr. Cornelisse’s girlfriend, was inside. Const. Dean was on the left and Const Pitts was to his right. The police officers spoke to Mr. Cornelisse regarding escorting the two individuals out. He said that he was part of the employee group that did that and that it was common for him to remove patrons as a backup to staff. Mr. Cornelisse said he had escorted people out with another door staff member, and that no altercation had happened. There was no altercation inside the Premises either. He watched both of the patrons go to the door. There were no problems. Mr. Cornelisse claimed at the doorway, one of the males started getting aggressive.

Const. Dean asked Mr. Cornelisse why, if there were no problems, he had left the DJ booth to assist. Mr. Cornelisse did not have a good answer to this question. He said he just did it. At this point, Mr. Cornelisse started to get a little frustrated. He raised his voice. He had a quarter inch cut on his left upper lip which he kept dabbing with Kleenex. Const. Dean said he looked like someone had smacked him. Const. Dean told Mr. Cornelisse about the stool allegation and the injuries caused. Mr. Cornelisse became aggressive and did not answer questions. He stepped forward and Const Dean asked him to step back indicating the officers were trying to resolve this and that Mr. Cornelisse should calm down.

At this point, Mr. Hiieuvins handed Mr. Cornelisse a CD and Mr. Cornelisse changed the song. He turned around to face the officers and Const Dean asked him another question. Mr. Cornelisse was evasive and gave smart answers to the questions. Const Dean said, “Maybe you would rather talk to us downtown.” Mr. Cornelisse said “No”. He then put his drink down, turned toward Const Dean and struck a fighting stance. His left hand grabbed Const Dean’s shirt collar and he swung at him with his right fist. Const Dean got his head down and took the fist to the top of the back of his head. Const. Dean pulled back to get distance towards the door and reached for his nightstick. Mr. Cornelisse then struck Const. Pitts who fell down on the floor. Mr. Cornelisse pulled back, braced his right arm on the wall or doorframe, and put his right foot to Const. Pitts’ head. At this point, Const. Dean reached for his weapon perceiving a threat to Const. Pitts’ life. Mr. Cornelisse repeatedly kicked Const. Pitts’ back with his right foot. Const Dean pointed his firearm at Mr. Cornelisse, moved into a better position and ordered him to stop and get onto the ground. The main bar was behind Mr. Cornelisse and Const Dean felt it was dangerous to engage Mr. Cornelisse in close quarters with his weapon. Mr. Hiieuvins yelled at Mr. Cornelisse to stop. He then reached in to grab Mr. Cornelisse by the waist and pull him away from Const. Pitts. Const Dean went to Const. Pitts to make sure he was alright and observed Mr. Cornelisse exiting the DJ booth through the main floor area. Both officers then chased Mr. Cornelisse.

Const. Pitts was ahead and went out the door where Mr. Cornelisse had exited. Ms. Fader was standing blocking part of the doorway. Const. Dean shoved her into the wall and went past her. She hit him and tried to grab the back of his coat to stop him from proceeding through the door.

Once outside Const. Pitts looked both ways up and down the street but could not see Mr. Cornelisse. Mr. Cornelisse then popped out from behind the left door where he had been hiding. He swung at Const. Dean, shoved him to the sidewalk, and went back into the Premises pulling the door closed behind him. It was an exit door which locked from the inside on closing. Const. Pitts ran down Clarence Street to the other entrance into the Premises. He called for Code 1 assistance for other officers to attend the scene.

Const. Dean stayed outside at the exit door. Other officers arrived. The door was opened from the inside. At that point, Const. Dean learned Ms. Fader was an employee of the bar, possibly a stripper. Police spent several hours attempting to locate Mr. Cornelisse and Ms. Fader inside the Premises and at other addresses. They were unsuccessful.

Const. Dean was questioned with regard to the timing of events that evening. He indicated that the officers had spent approximately fifteen to twenty minutes interviewing the people inside and outside of the ambulance. When the officers entered the Premises the first time, they stopped to look at the people inside. The first person they noticed was Jason Hiieuvins after a walk-through the bar. That was perhaps a minute after they had entered. They spoke to Mr. Hiieuvins in the vestibule area and then walking into the bar area again. That took perhaps four minutes. Const. Dean remembered Mr. Hiieuvins telling him that he had removed the aggressor. The full conversation could have been ten to twelve minutes in total. The officers then went outside to do the CPIC check on Mr. Cornelisse which could have taken 5 to 10 minutes.

Const. Dean stated that it was at 01:56 a.m. when Const. Pitts called for Code 1 assistance. From the time they were first dispatched to the Premises, Const. Dean indicated that the whole series of events occurred in a 1 hour timeframe.

On cross-examination, Const. Dean indicated that the independent witness was standing outside against the wall of the building. He had seen what had gone on, but could not describe who had done it. He had seen Wesley get struck by the doorman, but again could not describe the doorman very well. He had seen Gord dragged back into the Premises and struck with the stool. The witness indicated to the police officers that he was not with Wesley and Gord that night.

Const. Dean estimated there were 50 to 60 patrons in the bar when it closed. No interviews with any patrons were conducted by police. No witness indicated that Mr. Hiieuvins was involved in the assault. With regard to the fight in front of the stage and near to the door to the VIP area, Const. Dean said it could have been seen by a number of security, but none intervened. It is not uncommon for doormen to handle security issues and to call police when things become criminal in nature. It did not surprise Const. Dean that the doormen stood back.

Const. Dean indicated that he found management of the Premises hesitantly cooperative. They do what they have to, and no more. The Premises do not compare to any other bar in downtown London as this is the only adult entertainment bar downtown. There have been problems there in the past.

In answer to a question, Const. Dean indicated that he noticed the following staff being present: there was one door staff sitting on a stool at the front door, there was a coat check girl, there was a security person near the dance floor, to the left there was a tall man like a manager standing toward the bar, there was a door staff by the VIP entrance, there was Mr. Hiieuvins and the manager. Mr. Cornelisse was there together with his girlfriend and there were various employees such as bartenders, shooter girls, and strippers.

c) Constable Chris Carne

Const. Carne has been with the LPS for eight years. He is attached to the Community Orientation Response Unit. He is the liaison officer with the AGCO and performs liquor inspections and, when necessary, makes charges against bars. He also meets with bar owners. He was not at the Premises on the night of April 14 to 15, 2007. On the following Monday, he was directed to touch base with the owner of the Premises to determine what happened during the early morning hours of April 15. He had notes and had made a report. On consent, he was allowed to use his notes to refresh his memory.

After the incident took place, he tried to meet with the owner of the Premises to get their side of the events that had occurred. On Monday, April 16, Const. Carne spoke to Mr. Rudan on the phone and asked Mr. Rudan to come to London to meet with him to talk about the incident. Const. Carne said that he and Mr. Rudan had a good working relationship. However, Mr. Rudan could not come that day as he had a city council commitment to attend to.

The attending officers during the early morning of April 15, 2007 had noticed a video surveillance system. Const. Carne wanted to have a tape obtained from the system of the night of the events. At 2:30 p.m. on Monday, April 16, Const. Carne went to the Premises to get the video tape. He did not think it would be a problem. On arrival, he spoke to the general manager, Grace Gomes. Ms. Gomes was the only one who knew how to work the equipment. He had tried to call her earlier, but she had not called back. Ms. Gomes explained in person to Const. Carne that she had been on the phone with Chris Rudan and legal counsel. Their position at that time was they were not willing to give up the video tape to police.

Later, Mr. Fasari, Mr. Rudan’s legal counsel in Niagara Falls, called Const. Carne. Mr. Fasari asked Const. Carne why it was necessary for Mr. Rudan to come to London to speak to him. Const Carne explained it was in his best interest to get to the bottom of what had happened. There was no obligation to meet whatsoever. Later that afternoon, Const. Carne spoke to Mr. Rudan and confirmed the lawyer’s advice that they would not turn over the tape or the footage on the video system. However, Mr. Rudan indicated to Const. Carne that he could come to London the next day and meet.

The LPS wanted the footage on the tape. As a result, a warrant was prepared to obtain it and to see the tape as it played at Solid Gold. Ms Gomes had given Const. Carne a schedule as to who was working on the night of April 14 indicating that all employees had Smart Serve certificates. Copies of the certificates were given to Const. Carne. It turned out there were 3 employees for whom the Smart Serve documentation was yet to be received by Ms. Gomes.

Jason Hiieuvins had worked at the Premises for 1 ½ years. He had a history of violent incidents while working for various security companies and the police had expressed concerns about his employment at the Premises. The Licensee was supposed to do something about this. Const Carne indicated that Ms. Fader was also listed as an employee.

The manager on the night of April 14/15, 2007 at the Premises was Zoran Poznonovic. Const. Carne asked Mr. Poznonovic what had happened. He described an incident that got out of control, but that he himself had spent most of the night in the back office and did not know exactly what had happened. He did indicate that Mr. Cornelisse was only a temporary employee.

Const. Carne that night spoke to Chris Rudan who indicated that he had changed his mind and would now give up the surveillance video. Const Carne prepared a consent to search form on which Ms. Gomes would sign for Mr. Rudan. At 7:55 p.m. that night, his partner and Const. Carne attended the Premises to see Ms. Gomes. They obtained the original of the video tape.

That evening, Const. Carne also had contact with Det./Sgt. Morrissey of the AGCO concerning the incident that had happened in the early morning hours of April 15, 2007 involving uniformed officers. Det./Sgt. Morrissey asked for a copy of the report which was given to him.

On Tuesday, April 17, Const. Carne was asked to contact Det./Sgt. Morrissey. He was told that an interim suspension against the licensee would be issued. Const. Morton viewed the video and notice that the Dundas Street camera had blacked out for a two hour period. Ms. Gomes had told them there were problems with the tape throughout the night and it was not working right. It had not been tampered with. It was purely coincidental that the tape showed nothing. At 9:30 Tuesday night, a group including Const. Carne, Const. Morton and some others went to Solid Gold for the purpose of serving the interim suspension shutting the bar down. Previously, Const. Carne had been speaking with Mr. Rudan to set up a meeting that Tuesday night. Mr. Rudan was present. In serving the interim suspension, Const. Carne noted that the officers allowed the patrons to finish their drinks. Const. Carne indicated that Mr. Rudan was quite agitated at times that evening and questions were asked about Jason Hiieuvins and how long he had been employed at the club. That period of time was 2 – 2 ½ years. The officers left the Premises at 10:10 that night. On Wednesday, April 14, they returned the videotape.

On cross-examination, Const. Carne was asked about a meeting that took place in November, 2006 with representatives of the licensee to discus issues concerning a different infraction. Const. Carne indicated that everything has worked out well up to the early morning hours of April 15, 2007. He indicated a previous manager, with whom there were issues, had been terminated as an employee. However, he also indicated that with regard to a doorman, Jason Hiieuvins, although this person has caused problems in the past, he is still working at the Premises as a doorman notwithstanding that Const. Carne was told the problem would be looked after.

Const. Carne also indicated that he had received the 3 Smart Serve certificates that were not given to him when he met with Ms. Gomes on April 17. He was also told that the Premises and management were in a bind for a disc jockey so they hired Mr. Cornelisse. Mr. Cornelisse had filled in for a month or so but was clearly only going to be a temporary employee.

3. LICENSEE’S EVIDENCE

a) Jason Hiieuvins

Mr. Hiieuvins is 30 years old, and single. He has been working at Solid Gold for 2 – 2 ½ years. Before that he worked for 3 ½ years at another bar. He has also worked for ISM Security at events and concerts. He has 4 brothers and sisters, including a brother who is an OPP officer attached to the Woodstock detachment.

Mr. Hiieuvins indicated that on the night of April 14/15, 2007 he was on duty at the Premises as a doorman. Also on duty that night as doormen were Mike Foster, Mark and Dan. Mike had been working at the Premises for a few months. Mark had been working there for about a year and a half. Dan had started a couple of months ago.

Mr. Hiieuvins stated that there was a fight at the Clarence Street door before the police arrived. It had started in the middle of the bar. He saw it. A male patron, who was muscular, had been verbal to a disc jockey, Marcus Cornelisse. Mr. Cornelisse had been working there a couple of months. Mr. Hiieuvins did not know Mr. Cornelisse well. He heard something over the loudspeaker being a swear word. The patron was being belligerent to the disc jockey. Mr. Hiieuvins asked the patron to calm down. The patron was there with a friend and two females who said they could remove the patron.

Mr. Foster and Mr. Hiieuvins started walking the patrons out. When they neared the door, there were customers coming into the Premises. Those going out and those coming in bumped into each other and an altercation started. The disc jockey got involved coming out of the DJ booth and helping out. Mr. Hiieuvins went to the bar area near the Dundas Street door and stayed there. People were outside. Police were called.

Two officers came in and walked through though bar and spoke to Mr. Hiieuvins. They demanded information from him and took him into a corridor. Mr. Hiieuvins explained what had happened step by step. One of the police officers kept telling Mr. Hiieuvins to calm down. He was swearing in his face and telling him to cooperate. The two police officers then proceeded into the DJ booth and entered it. Mr. Hiieuvins was standing near the VIP door with Zoran and Michael. The same police officers came up to the group and were verbal and threatening. They said if the employees would not give them information, they would be arrested. There was a verbal argument between the employees and the police officers. A police officer took his name and then Mr. Hiieuvins left the area. Everything was calm at that point.

About 5 - 10 minutes later, Mr. Hiieuvins went to the DJ booth. Zoran, the manager, was walking a few feet behind the police officers. Mr. Hiieuvins was walking behind Zoran. The disc jockey booth is not big. Mr. Hiieuvins had to squeeze in. A lot of people were in there. The police officers were asking Mr. Cornelisse a few questions. He was telling the police what was going on. The police officers were aggressive in their questions and body language. There was one other patron in the booth that Mr. Hiieuvins did not know. One police officer made a gesture to Mr. Cornelisse and Mr. Cornelisse started fighting. Mr. Hiieuvins started to try to pull Mr. Cornelisse and the police officer apart. Mr. Cornelisse ran outside. The police pulled out guns, pepper spray and a night stick. They all went out the Dundas St. exit door, and then Mr. Cornelisse came back in and closed the doors leaving the police officers outside. The doors locked from the inside.

The bar was pretty busy. The police came back in yelling “Where is Mr. Cornelisse?” No one had seen where Mr. Cornelisse had gone to. Mr. Hiieuvins was asked if the lights could be put on which he did about 1:50 a.m. People were told to clear out. At that point a SWAT team with supervisors was present asking people where Mr. Cornelisse went to because he had left the Premises. The Premises were shut down and cleaned up.

Mr. Hiieuvins stated that he never saw the fight between the two patrons near the stage area. He did notice that the police had a kid handcuffed.

In answer to questions on cross-examination, Mr. Hiieuvins indicated that he had worked at ISM for 2 years and was fired because of a supposed affiliation with the Hells Angels.

Regarding the fight at the main entrance, Mr. Hiieuvins reiterated that the party going out bumped into the party coming in and everyone started swinging. Security was trying to remove the patrons who had been inside. Mark, Mike and Mr. Hiieuvins were at the door. Mr. Cornelisse was trying to remove one guy.

Mr. Hiieuvins dealt with a “muscle guy”. Marc dealt with the guys coming in. Mr. Cornelisse was dealing with someone. He had come to help trying to remove people from the Premises. Mr. Cornelisse was pushing guys off of him. Mr. Hiieuvins did not see how he split his lip. Mr. Hiieuvins indicated that he thought this had happened around 1:15 a.m. As to what started the problem in the first place, Mr. Cornelisse was swearing over the speakers at one of the patrons. Mr. Cornelisse had told Mr. Hiieuvins that the patrons were yelling at him to play better music and he was talking back using the microphone. The patrons had two girls with them, a blonde and a brunette. The muscular guy was hit in the face on the right side and his face swelled. The fight lasted not even 5 minutes in the estimation of Mr. Hiieuvins. There was arguing, shoving, punching and then it was broken up. Mark was between the doors and dealt with the incoming people. Mr. Hiieuvins dealt with the aggressor who was leaving the Premises. Mark is about 6 feet tall and weighs 200 pounds. Mike is 6 feet tall and weighs approximately the same. Mr. Hiieuvins is about 6 feet tall and weighs 250 pounds. Mr. Hiieuvins has experience dealing with these people. Mark is a more relaxed type of guy. Mike has a beer bin there and he was making sure that all bottles went into the beer bin. Mr. Hiieuvins testified that he did not call for Mr. Cornelisse to come over. He did not know who did, if anyone. During this time, Dan was at the Dundas Street door and stayed there.

After the eviction of the patrons the police officers arrived. Mr. Hiieuvins estimated that their time of arrival was around 1:30, but he could not be sure. Mr. Hiieuvins was concerned that the police officers were looking at him with regard to the fight at the front door. They indicated that “You are involved”. They never told Mr. Hiieuvins he was not a suspect. They were in the Premises perhaps 10 minutes or so and then they left, going out of the Clarence Street entrance. Mr. Hiieuvins did not see them come back in which he estimated took place 5 or 10 minutes later. He noticed they were in the Dundas Street entrance with a patron in handcuffs. They let him go and then the police headed to the DJ booth again. When the police first came in, they went over to Mr. Hiieuvins while he was standing in front of the VIP entrance. They wanted to know who punched out the patron. They wanted his name, address, and phone number and if he didn’t give it to them then the police would arrest Mr. Hiieuvins. He gave them what they wanted.

When they came back in and went to the DJ booth, they were followed by Zoran. Mr. Hiieuvins followed Zoran because he is a roamer. All was under control at that point. The reason he follows is that Mr. Hiieuvins can deal any issue. Zoran did not ask Mr. Hiieuvins to follow him that evening, he just did.

In the DJ booth, the officers became aggressive. Mr. Cornelisse threw the first punch. He was punching an officer in the face and the second officer was on the floor being kicked by Mr. Cornelisse more than once. Mr. Hiieuvins, the manager and a patron in the DJ booth all held on to Mr. Cornelisse. The witness felt that if they had not pulled Mr. Cornelisse off of the officers, the police officer on the floor would have suffered a lot of injuries.

Mr. Cornelisse broke away and the three people trying to hold onto him could not do so. Mr. Cornelisse went out the Dundas Street exit door which was about 20 feet away from the DJ booth. The police ran after him holding a gun and pepper spray out. The officer who had been kicked on the floor was holding the pepper spray. The officer who had been punched by Mr. Cornelisse had his weapon drawn. Mr. Hiieuvins saw Mr. Cornelisse open the door, and he and the police officers all bolted outside. Suddenly, Mr. Cornelisse turned up back inside as he had been hiding behind the door when it was open. This was an exit door which can be opened from the inside and locked from the inside. Mr. Cornelisse ran past Mr. Hiieuvins. Mr. Hiieuvins did nothing including not opening the door for the police officers. He did not even think about it. He walked back towards the main entrance and saw the police coming inside through the Clarence Street entrance. They demanded to know where Mr. Cornelisse had gone. Mr. Hiieuvins just stood there and did not intervene.

No one asked Mr. Hiieuvins where Mr. Cornelisse had gone. The police were yelling at Mike. No one wanted any information other than where Mr. Cornelisse had gone. No police officer asked for a statement. Ultimately, Mr. Hiieuvins flicked on the lights and people were told to leave.

In answer to questions on re-direct, Mr. Hiieuvins indicated that he has nothing to do with Hells Angels. He was convicted as a young offender. He also has taken the Smart Serve course.

b) Grace Gomes

Ms. Gomes is 33 years of age. She is the General Manager of the Licensee and has been such for 7 or 8 years. She reports to Chris Rudan or to his son, Simo Rudan. One of them comes to London one week, and the other comes the next week. One of them is there each week. There is also another manager, Zoran. They work together on Friday nights. Zoran works 4 nights. The Premises are closed Sunday evening, but Ms Gomes is there most of the other times.

Ms. Gomes stated that Mr. Cornelisse was hired by both her and Zoran. About 10 or 12 years ago, Mr. Cornelisse worked at Solid Gold for 2 years as a disc jockey and on security. They saw him when he was a patron at Solid Gold about a year ago. At that point he had a girlfriend, Leigh Fader. They hired Mr. Cornelisse as a disc jockey. He approached Ms. Gomes indicating he wanted part-time work. They needed a filler on Monday and Saturday as they were short on disc jockeys. Mr. Cornelisse had started to work as a disc jockey approximately 3-4 weeks before the incident in the early morning of April 15, 2007. Before that evening, there were no problems with him. Ms. Fader is a bartender. She worked 2 or 3 times a week during the day.

Early Sunday morning, April 15, Zoran called Ms. Gomes to tell her what had happened. Zoran had called Chris. Zoran had simply left a message on Ms. Gomes’ telephone. She was not home on Sunday, and no one else called her.

On Monday afternoon, April 16, 2007 Const. Carne and other officers came into the Premises. They were looking for staff information who worked the night of April 14/15. They also asked for a hard drive from the computer which contains surveillance film. Ms. Gomes was advised by Mr. Pisari not to deliver the hard drive to the police. Subsequently, Mr. Rudan advised that it was alright to do so and the information and material was handed over. She gave the material to Const. Carne and his partner and left the two officers there to view the videotape. The surveillance is all recorded on a hard drive not on a disc. There are 8 cameras but 2 or 3 were not working. Const. Carne asked why the cameras were not working because the surveillance tape was blank. She explained that there were loose wires at the back causing the camera to flicker. Ms. Gomes knew this before as she was waiting for a repair person to come and fix the surveillance system. That repair service was called Quickfix. They installed the system. Ms. Gomes has shown Zoran how to operate it, but he still cannot do so.

Subsequently, Const. Carne returned the hard drive. It was purely coincidence that the time frame involving the disturbance in the early morning of April 15, 2007 was not caught on the system.

Ms. Gomes hires employees, including Mr. Cornelisse. Before that, she had hired Mike in January, 2007. People hand in their resumes and, since September 2006, Ms. Gomes is under instructions form Mr. Rudan to have the prospective employee obtain a police report and submit it to her. She indicated that she did that for Michael and for Jason Hiieuvins.

There are also manuals prepared for different classes of employees. Ms. Gomes indicates that she asks the employees to read the manual which applies to their position. She also makes sure they have Smart Serve certification. The manuals came from Chris and Simo Rudan. She expects the employees to read them thoroughly and then give them back. The manuals were put into evidence as follows:

Ex. 1 (a) – Management Training Manual

Ex. 1 (b) – Door/Floor Training Manual

Ex. 1 (c) – Server Training Manual

Ex. 1 (d) – Bartender Training Manual

Ex. 1 (e) – Entertainer Training Manual

Ms. Gomes stated that Jason Hiieuvins has been a reliable and good employee. There have no run-ins with police. He is respectful with patrons and does not use force. Mr. Hiieuvins is not in charge of the other doormen. Mike is in charge.

With regard to her working relationship with Mr. Chris Rudan, Ms. Gomes indicated there are strict controls. Mr. Rudan has told her that if she needs advice with regard to something or an incident occurs in the Premises, Ms. Gomes is to call him directly. He is strict. He would not tolerate any group such as the Hells Angels. They would not be allowed in the Premises in colours or wearing a patch. There had been a problem with the Hells Angels a couple of years ago. Mr. Rudan had been bottled twice on the way out. Police intervened; they were charged and ultimately fined.

In cross-examination, Ms. Gomes indicated that she and Zoran hire employees. She has been doing so for 7-8 years. Zoran has been a manager on and off for 6-8 years.

She indicated the manuals comprising Exhibit 1 had been around for 4 or 5 years, but had not been updated since. Messrs. Chris and Sima Rudan have given instructions to Ms. Gomes and Zoran that any hiring on security requires that the applicant obtains a police background check. This has been in place since September 2006. Mike Fortier started in that position in January of 2007. In answer to questions, Ms. Gomes indicated that Mike Fortier and Jason Hiieuvins have obtained police background checks. However, others who have started more recently have not yet obtained their checks despite Ms. Gomes asking them and asking Mike Fortier to ask them. No deadline has been set to obtain these police checks.

Mr. Cornelisse was not security. He was never told that he would be in security. Because of that, it was Ms. Gomes’ decision not to have Mr. Cornelisse obtain a police check to give to the employer. Ms. Gomes indicated she was shocked that Mr. Cornelisse is alleged to have gotten involved in an altercation in the early morning of April 15. She did not know anything Mr. Cornelisse and his background, other than the fact that he had worked in the Premises 10 – 12 years ago. They counted on that. There was never any discussion between her and Zoran to check him out. Mr. Cornelisse, it was felt, was a good disc jockey to fill in.

Zoran was on duty that night as the manager. He told Ms. Gomes what had happened. Zoran prepared an incident report as did the doormen involved, Mike Fortier and Jason Hiieuvins. The three incident reports were entered as exhibits, as follows:

Ex. 2(a) – Incident Report of Zoran;

Ex. 2(b) – Incident Report of Mike Fortier;

Ex. 2(c) – Incident Report of Jason Hiieuvins.

Ms. Gomes indicated that if an individual had a record on his police report of assault, aggressive behaviour or things of that nature, that would be a bar to employment at Solid Gold.

As for management style, Ms. Gomes reiterated that Chris and Simo Rudan call daily, and come down once in a while. She is in charge of Zoran. She indicated that she makes reports to Messrs. Rudan by way of bills, how revenues and attendance are doing, maintenance problems etc. Occasionally, she raises issues with regard to the doormen and has been told, for example, to be stern with Mike to obtain his police background check. About the end of January, Chris Rudan indicated to Ms. Gomes that it was important to obtain this. Ms. Gomes indicated that to obtain the police background check, the employee has to request the report directly from the police department.

What she knew about the first altercation on the evening of April 15, 2007 was that 2 customers had a problem with the disc jockey. They were being obnoxious. The doormen told the two that they had to be removed. On the way out, the departing customers ran into two customers coming in. One of the customers leaving pushed one of the customers coming in and a fight started. This was in Mr. Hiieuvins’ report that she received the day afterwards. In looking at Mr. Hiieuvins’ report (Ex. 2c) Ms. Gomes indicated that Mr. Cornelisse’ comments were inappropriate according to the manuals. She indicated that Mr. Cornelisse would not have been given a manual to read because he was a disc jockey, and not involved in security. She assumed that Mr. Cornelisse would have known how to behave.

On re-examination, Ms.Gomes confirmed that Mr. Cornelisse was only hired on a short term basis. There was no intent to keep him on. She also confirmed that she speaks to Chris or Simo Rudan every day and sees them once a week. They are based in Niagara Falls. Ms. Gomes also stated that Zoran has worked off and on for 10 – 11 years. She did not feel that she needed higher education for her management role. She has a high school diploma and attended Fanshawe College to gain education for a Legal Assistant. She has never taken Management courses. She indicated that the Licensee employs approximately 35 people.

In answer to the Board’s questions, Ms. Gomes indicated that it was not Mr. Cornelisse’s job as a disc jockey to deal with customers and he does not report to the manager. It appears that he took things into his own hands the evening of April 14/15, 2007. Ms. Gomes indicated that she and Zoran had talked to Mr. Cornelisse when he did his first shift explaining to him what his duties were as a disc jockey.

c) Chris Rudan

Mr. Rudan is 62 years old. He is the president of the Licensee. He is originally from Croatia, then went to France and then came to Canada in November of 1964. He has a high school diploma and attended hospitality school to become a chef. Mr. Rudan owns a number of businesses in the hospitality industry, including 5 adult entertainment clubs, including the Premises. The head office of his company is in Niagara Falls where he employs 6 people. His company employs approximately 300 people altogether. Mr. Rudan has 3 sons, including Simo. Mr. Rudan and his son Simo are responsible for the operations at the Premises.

Mr. Rudan bought Solid Gold about 12 years ago. He confirmed that the dancers are freelance operators and not employees. He has insured that there are operating guidelines with the staff. Mr. Rudan brought Zoran with him from Niagara Falls. Zoran’s background is as a cook in Europe. He worked in bars and kitchens. Mr. Rudan stated that he has experience and education in the hospitality business. People who work in the business need to know how to operate it. Therefore, he had professionals create manuals for his business. He wants to make sure that the business is running properly. The manuals are given to the Manager, Ms. Gomes, and she is supposed to make sure that all employees read the manual that applies to their position.

Mr. Rudan indicated that Solid Gold is of an average size among the 5 adult entertainment facilities he owns. He indicated that at the beginning of her career, Grace Gomes was a bartender. That was approximately 10 years ago. He prefers to have a female manager overseeing the dancers. She had attributes for a manager. At that time, his son Simo was attending University of Western Ontario and Simo helped train Ms. Gomes. Ms. Gomes is the General Manager. Zoran is an Assistant Manager and was on duty on the evening of April 14/15, 2007. Ms. Gomes worked 6 days a week. Zoran will fill in for her.

Chris Rudan and his son Simo manage the Premises through phone calls daily to ensure that all is running smoothly. They make sure that staff are properly checking minors and that no drugs or other criminal activities are incurring inside. He is very sorry the incident of April 14-15 happened. He indicated it was the first time it had ever been done. He wants to make sure that it will not happen again. He has put his heart and soul into all of his businesses. Whenever an incident happens, all employees involved have to write a memo. It is done all the time in every facility he owns. The Manager then has to deal with the issues and the problems.

Mr. Rudan indicated there were two prior incidents. There was an assault involving patrons about 1 ½ to 2 years ago, there was an issue with regard to serving underage patrons, and, finally, there was an issue with regard to dancers smoking pot just outside the Premises. He has had meetings with police in London about a former employee, Tom Catsaris. Mr Catsaris was doing Zoran’s job because Zoran was off work supervising a construction project. Mr. Catsaris was living upstairs in an apartment. He had worked for several clubs in Toronto. Before hiring Mr. Catsaris, Mr. Rudan had checked his references and was told that Mr. Catsaris was fine but he liked to gamble. His references indicated Mr. Catsaris was fair, honest, and clean. Mr. Rudan needed someone and hired Mr. Catsaris. One night, Mr. Catsaris had a problem with a customer in the VIP room. The customer indicated he did not want to pay. Mr. Catsaris went to the customer who was rude and wanted to fight with him. Mr. Catsaris escorted the guy out, the customer was helped out of the Premises, calls the police and the result is that the Premises were closed for 1 month. There was some sort of other charge and at a meeting with police. Mr. Rudan was told he had to fire Mr. Catsaris. He did.

Mr. Rudan indicated that on April 14/15, 2007 he was in Niagara Falls and received a late night telephone message from Zoran with regard to the incident involving Mr. Cornelisse. The next morning, Mr. Rudan called Zoran around 10 a.m. who told him what had happened. Mr. Rudan never met Mr. Cornelisse when he was hired this time, but saw him when he worked as a doorman 9 -10 years ago. Mr. Rudan knew there were no problems then. Zoran had told him that Mr. Cornelisse used to work for Sold Gold. Mr. Rudan stated that disc jockeys are funny people. Mr. Rudan has rules for them, namely that there is to be no swearing on the public address system, no heavy metal or rock music, and to dress in a very clean manner. The disc jockeys do not work with the customers, just the dancers.

On receiving the news from Zoran, Mr. Rudan was very upset. He called his lawyers, Jeff Lyons and Angelo Fasari indicating that they had a serious problem. Mr. Lyons was away. Mr. Fasari said to have the manager call him. As a result, he asked Ms. Gomes to call Mr. Fasari on Monday. Mr. Rudan could not get to London on Monday because of a re-zoning hearing he had that evening. Const. Carne of the LPS did call him and ask him to come for an important meeting. On Tuesday, Mr. Rudan talked to Const. Carne about the video tapes. They had gone to Ms. Gomes who had called Mr. Fasari. Mr. Rudan told Ms. Gomes that we have nothing to hide and to give everything to the police. She indicated that there were some pieces missing. Mr. Rudan knew that Ms. Gomes had called Quickfix but that they had not yet come to fix the video surveillance system. Mr. Rudan indicated he did not know the system was not working well. Ms. Gomes told him this after the incident.

Mr. Rudan indicated that there had been a change in policy regarding the requirement for doormen to have police checks. He indicated that he had done this because based on his experience in the last three years, some doorman hired had criminal records. The doormen represent the business and as a result their background is now checked. In this case, the manager should have followed up with those who did not yet have their police checks. She is not doing well on this score. She is too trusting. Now, all police checks will go to Mr. Rudan’s office in Niagara Falls who will review the background information from his office. Mr. Rudan reiterated that he did not know they had hired Mr. Cornelisse. They are now checking records for any male to be hired. He also indicated that they do not have a large change of staff. With regard to the manuals, Mr. Rudan agreed that they were not updated. However, he said they should be updated such as adding things like checking criminal records.

Mr. Rudan indicated that he would be agreeable to a condition regarding Mr. Cornelisse and Leigh Fader, that they not be allowed in the Premises anymore. He said that they already have a policy that if someone is cut off, they are not allowed back. He also indicated that they may need to go in a different direction re management. If necessary, he would replace a manager to improve things. He also said he would get new cameras if necessary including one on the street. Mr. Rudan said there is nothing to hide and as an example he used the problems with the Hells Angels bikers a couple of years ago. Mr. Rudan also said that he is never had a problem in any of his other establishments like this one since 1969. There has never been an assault by a doorman. However, he indicated that customers complain for any reason and call police if they feel ticked off.

In cross-examination, two prior decisions of the AGCO were entered as exhibits. The first (Ex. 3) was a decision of the AGCO dated August 31, 2005 where the Board found that the Licensee had breached subsection 45 (1) of the O. Reg. The second (Ex. 4) was a decision of the AGCO dated June 1, 2006 which, on an Agreed Statement of Fact and Joint Submission on Disposition, there was a 30 day suspension of the Licence and the addition of a condition prohibiting Tom Catsaris from having anything to do with the licensed establishment. Mr. Rudan confirmed that the manuals (Ex. 1) were the same manuals that were referred to in paragraph 13 of the AGCO decision of August 31, 2005 (Ex. 3).

Mr. Rudan confirmed that with regard to the AGCO decision dated June 1, 2006 (Ex. 4) that there was indeed a 30 day suspension of the Licence and the addition of a condition. Mr. Rudan also agreed that there had been an altercation in the Premises on November 5, 2004 and that, as stated at the top of page 3 of the decision, “an employee of the license holder brandished a baseball bat”.

During his cross-examination, Mr. Kulis pointed out to Mr. Rudan several obvious mistakes in a couple of the manuals referring to either U.S Government agencies, or in one case to a U.S. company. Mr. Rudan agreed with Mr. Kulis that there were mistakes in the manuals. On re-direct, Mr. Rudan indicated that the manuals had to be updated.

4. REGISTRAR’S SUBMISSIONS

Mr. Kulis stated that the evidence indicates there were 3 altercations in the Premises in the early morning hours of April 15, 2007.

First, patrons got into a verbal dispute with Mr. Cornelisse, the disc jockey. Mr. Hiieuvins said he attended near the DJ booth and heard Mr. Cornelisse say to the patrons to go fight outside. This was in response to a patron making threats to Mr. Cornelisse. The patrons were being escorted out. For some reason, Mr. Cornelisse who was not a security employee, accompanied both the exiting patrons and the security members escorting them out. Mr. Cornelisse breached the policy of the Licensee by getting involved. As a result there was a confrontation and a 5 minute fight ensued. The staff of the Licensee were negligent to allow this to happen and continue. It was fairly intense according to the evidence. The police were not there when it occurred. One of the patrons told police he was dragged back into the Premises and assaulted inside. The injuries sustained were more in line with what the patrons described to police, not what Mr. Hiieuvins described. Regardless, there was an altercation inside the Premises.

Second, there was an altercation between 2 patrons as the police re-entered the Premises after performing a check on Mr. Cornelisse from their cruiser’s computer system. No security was present at the altercation so the police officers had to intervene.

Third, Mr. Cornelisse assaulted both police officers in the DJ booth. Mr. Hiieuvins stated that Mr. Cornelisse threw the first punch. The police officers went into detail: one was punched to the floor and repeatedly kicked; the other was punched twice. Mr. Cornelisse ran out of the Premises, hid behind a door, re-entered the Premises, locked the door shut, and ran away. Mr. Hiieuvins watched all of this, did not open the shut and locked exit door, nor did he assist police. He just walked away to the front door.

Evidence was led by Licensee of what staff are supposed to do. The evidence showed a great deal of what staff failed to do as required by management. Mr. Cornelisse was in a confrontation and then punched police officers. The manuals (Ex. 1) are supposed to show how well the Premises are operated and managed. These were the same manuals referred to in the August 31, 2005 AGCO decision (Ex. 3) against the Licensee. No changes have ever been made to them. That was the case involving Tom Catsaris. Simply having these manuals (Ex. 1) is not enough, but not checking that staff have read and understood them, undermines any attempt by Mr. Rudan to prevent problems.

Mr. Kulis stated the Board can make findings under subsection 45(1) of the O. Reg., (permitting quarrelsome, violent or disorderly conduct), and either subsection 45(1) of the LLA (obstructing inspection) or subsection 45(2) of the LLA (failed to facilitate an inspection). Mr. Kulis suggested that 45(1) of the LLA is the better section of the latter two. Mr Hiieuvins pulled Mr. Cornelisse off of the two police officers in the disc jockey booth, but after Mr. Cornelisse ran out and then back into the Premises, Mr. Hiieuvins failed to facilitate the police in their trying to locate Mr. Cornelisse.

Mr. Kulis concluded by saying that, with regard to a finding to be made by the Board under paragraph 6(2)(d) of the LLA, Mr. Chris Rudan is an officer, director and shareholder (10% or more) of the Licensee and his conduct in letting this happen shows the business is not being carried on in accordance with the law and with integrity and honesty.

5. LICENSEE’S SUBMISSIONS

Mr. Lyons said that with regard to subsection 45(1) of O. Reg., Mr. Kulis mentioned three altercations. Regarding the first one, the police interviewed witnesses. No one appeared at the hearing. The police did not interview patrons other than the exiting ones who were hurt, except for one independent witness. No other person was asked for statement.

Ten to twelve police officers were called to the Premises to assist the first two officers. They were all caught up in looking for Mr. Cornelisse at that point.

Regarding the second altercation, the police looked after it. There was no dereliction of duty by the Licensee.

Regarding the altercation in the DJ booth, Mr. Cornelisse was clearly a bad hire. He was known to management from a period of 10 to 12 years ago when had worked at the Premises previously, but he went bad. No one knew about that. He was filling a temporary need. He was not hired as a full time employee, nor was he hired to do anything other than being a disc jockey. Unfortunately, he put the Licensee into a grave matter. Grace Gomes had told him he was not to be involved with customers, but he did, and for that the Licensee is at fault.

Mr. Hiieuvins might be arrogant, but he pulled Mr. Cornelisse off of the police officers in the disc jockey booth. Things were tumultuous – guns drawn, pepper spray out. Mr. Hiieuvins tried to help the police initially, and when they came back in, they yelled at him. All of this happened in a short time.

A SWAT police team was in the Premises, the last thing anyone wanted.

It is clear that staff has not performed well. The Licensee has produced manuals (Ex. 1), but they do not appear to have been read or were read less than hoped for.

With regard to a finding under paragraph 6(2)(d) of the Act, Mr. Lyons stated that Chris Rudan has integrity and honesty. He is a successful businessman. He wants things well run. He does not permit bikers in the Premises. He wants to check potential employees with police checks. He calls the manager of the Premises everyday. In alternative weeks, he and his son come to the Premises.

Mr. Rudan, when he found out about Tom Catsaris, met with LPS, fired Mr. Catsaris and agreed to have a condition placed on his Licence concerning Mr. Catsaris. Ms. Gomes and Zoran may not have been fulfilling the functions they were hired for.

It is not in the interests of the AGCO to take away Mr. Rudan’s licence. He would agree to a condition not to allow Mr. Cornelisse or Ms. Fader on the Premises. He would also agree to a new, working security system, with full access to it for the police. Mr. Rudan must be more hands-on overseeing management of the Premises.

The Licensee has an excellent relationship with Const. Carne. He has a good relationship with the Chief’s office. He was shocked at what happened. Everyone likes Ms. Gomes, but everyone would like her to be a bit tougher.

6. FINDINGS

(a) Paragraph 6(2)(d) of the LLA

The issue in connection with this paragraph is whether or not the present or past conduct of Mr. Rudan affords reasonable grounds for belief that the business carried on by the Licensee will not be carried on in accordance with the law and with integrity and honesty (underling added).

The Registrar’s case concerning paragraph 6(2)(d) is based to a large part on the two prior decisions of the AGCO (Ex. 3 and Ex. 4), and on Licensee’s inability to institute effective procedures to protect patrons from the assault that allegedly occurred at or near the front door which caused the police to first come to the Premises in the early morning of April 15, 2007.

In its decision of August 31, 2005 (Ex.3), the Board found that the Licensee had permitted violent and disorderly conduct to occur on the Premises, and that, therefore, had breached subsection 45(1) of the O. Reg. There had been an altercation between the then manager and a customer who was injured by the manager. Based on a joint submission regarding disposition, the Board imposed a 12 day suspension of the licence.

In its decision of June 1, 2006 (Ex. 4), based on an agreed statement of facts, the Board found:

a) that there was a drunken patron in the Premises on November 5, 2004, an altercation had occurred and an employee of the Licensee had brandished a baseball bat;

b) people under the age of 19 consumed liquor in the Premises on March 6, 2005;

c) a person smoke marijuana in the Premises on November 3, 2005; and,

d) a patron had removed liquor from a licensed to an unlicensed area on November 3, 2005.

Based on the above and joint submissions on disposition, the parties agreed to a 30 day suspension of the licence.

There was no evidence adduced in this hearing concerning Mr. Rudan’s lack of integrity and honesty. In reading paragraph 6(2)(d) of the Act, Mr. Rudan’s past or present conduct must, if the Registrar’s argument is to succeed, afford reasonable grounds for belief that the business of the Licensee “will not be carried on in accordance with the law and with integrity and honesty” (underlining added).

It would appear that the Legislature when enacting paragraph 6(2)(d) of the LLA intended to add a qualification to the belief that the business would not be carried on in accordance with the law.

Evidence was adduced that the Licensee had 2 prior discipline hearings and findings (Ex. 3 and 4). Coupled with the evidenced adduced at the hearing, these are certainly sufficient to show that the business of the Licensee is not being carried on in accordance with the law.

However, the Legislature added to paragraph 6(2)(d) that there also has to be a belief that the business is not being carried on with integrity and honesty. The wording of paragraph 6(2)(d) of the Act makes the test a two-fold one, and for the second part, the Board must assess the integrity and honesty of the person whose conduct is under scrutiny.

Mr. Rudan has gone to the trouble of having manuals prepared for various classes of employees (Ex. 1). It is correct that the manuals require changes and updating, but on review they appear generally comprehensive and instructive. Mr. Rudan talks to the manager of the Premises daily. He or his son visits the Premises weekly. He has instructed his manager to have prospective security employees obtain police checks. He deals with LPS and apparently deals promptly with matters raised by LPS.

Notwithstanding all of these factors, Mr. Rudan’s staff (not Mr. Rudan) hired a part-time disc jockey who created a significant problem for the Licensee on April 15, 2007. The Board does not believe the hiring of Mr. Cornelisse as a part time disc jockey by management at the Premises leads to a conclusion that the Licensee is not carrying or will not carry on the business with integrity and honesty. As an aside, the Board feels Mr. Rudan must supervise management staff at the Premises better and ensure that police checks are carried out on all employees before they are hired, something he said he had instructed Ms. Gomes to do but which she had been very lax to implement.

Therefore, the Board makes no finding regarding a violation or breach of paragraph 6(2)(d) of the LLA.

(b) Subsection 45(1) of the O. Reg.

Based on the evidence of the two police officers, Mr. Hiieuvins and the incident reports prepared by Licensee’s three employees (Ex. 2), the Board finds that the Licensee permitted quarrelsome, violent or disorderly conduct to occur in the Premises on three occasions in the early morning of April 15, 2007, namely:

a) the exchange of shouting between two patrons and the disc jockey, leading to the expulsion of the patrons and the fighting at the front door while they were leaving;

b) the altercation between two patrons which the two police officers had to break up; and

c) the violence that occurred in the disc jockey booth involving the two police officers and Mr. Cornelisse.

As a result, the Board makes a finding that there were violations of subsection 45(1) of the O. Reg.

(c) Subsection 45(1) or 45(2) of the LLA

As Mr. Kulis stated at the hearing, these two subsections are in the alternative. There are two arguments advanced by the Registrar. First, Mr. Hiieuvins failed to provide assistance or information to the police on their attempt to re-enter the Premises through the closed and locked exit door, nor did he provide any assistance when they did re-enter the Premises. Second, the Licensee failed to produce security tapes from its security system when requested to do so.

Neither subsection has application to the behaviour of Mr. Hiieuvins. By not opening the closed and locked exit door to police, he could not be said to have “obstructed” or “failed to facilitate”. Police were coming in the front door. There was no evidence as to how close he was to the locked door nor was there any evidence that the police even knocked or banged on the closed exit door trying to re-enter the Premises.

Mr. Hiieuvins also testified he did not know where Mr. Cornelisse went to after he re-entered the Premises, and the Board was given no reason based on the evidence presented at the hearing to think otherwise.

With respect to the surveillance tape, it was requested on Monday afternoon, April 16, by Const. Carne. He made this request to the manager, Grace Gomes. Ms. Gomes was trying to get instructions from Mr. Rudan and his counsel, Mr. Fasari. While the response was initially negative, the video was made available to police that evening or the next day, when Mr. Rudan made the decision as the owner. While there may have been some delay in turning over the video or making it available to police, any such delay was slight, and ultimately of no consequence because, due to a malfunction, the video was blank. The evidence given at the hearing that there was no belief by LPS that anything other than a normal technical system malfunction had occurred.

Therefore, the Board makes no finding under either subsection 45(1) or 45(2) of the LLA.

7. SUBMISSIONS AS TO SANCTION

As agreed to at the hearing by counsel for the Registrar and for the Licensee, submissions as to sanction will be made by telephone conference call. A date and time for that will be canvassed by the AGCO Hearings Department.

8. INTERIM SUSPENSION

The Interim Suspension imposed by the Registrar April 17, 2007, will continue until a decision on sanction is made by the Board.

DATED AT TORONTO THIS 29^TH^ DAY OF MAY, 2007.

DAVID C. GAVSIE, CHAIR GUY MAURICE, BOARD MEMBER

DCG/mw