LIQUOR LICENCE ACT, R.S.O. 1990
In the Matter of: CABBAGETOWN RESTAURANT & BAR
443 Parliament Street
Toronto, Ontario
M5A 3A1
Licensee: 1607310 Ontario Inc.
Licence Number: 21291
Notice of Proposal: To SUSPEND a licence
Dated April 7, 2006
Supplementary
Notice of Proposal: To REVOKE a licence
Dated May 23, 2006
Supplementary
Notice of Proposal: To REVOKE a licence
Dated September 29, 2006
The Proposals allege that:
(a) Contrary to subsection 45(2) of Ontario Regulation 719/90 under the Liquor Licence Act, the licence holder permitted a person to hold, offer for sale, sell, distribute or consume a narcotic as defined in the Controlled Drugs and Substances Act on the premises or in the adjacent washrooms, liquor and food preparation areas and storage areas under the exclusive control of the licence holder.
(b) Contrary to subsection 6(2)(h) of the Liquor Licence Act, the licence is not in the public interest having regard to the needs and wishes of the residents of the municipality in which the premises are located.
(c) 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.
(d) Contrary to subsection 54(1)(a) of Ontario Regulation 719/90 under the Liquor Licence Act, the licence holder failed to retain the record of the purchases of food and liquor for the licensed premises.
Hearing: Alcohol and Gaming Commission of Ontario
90 Sheppard Avenue East, 3rd Floor
Toronto, Ontario M2N 0A4
January 4 & 5, 2007
Hearing on Motion: Alcohol and Gaming Commission of Ontario
90 Sheppard Avenue East, 3rd Floor
Toronto, Ontario M2N 0A4
February 12, 2007
Presiding
Board Members: Alex McCauley, Member
Allan Higdon, Member
Counsel for the
Registrar: Joyce Taylor
Agent for the
Licensee: Fred DiBello
Representing the Licensee at the hearing on
January 4 & 5, 2007
Counsel for the
Licensee: Michael A. Leitold & Peter Rosenthal
Representing the Licensee after January 27, 2007 and at the hearing on motion on February 12, 2007
Party to the
Proceedings: Eric Murphy, representing the residents
Exhibits: A - Motion record from Licensee’s counsel
B - Registrar’s counsel’s factum, book of authorities, and
Motion record
C - Affidavit of Eric Murphy, Party to the Proceedings
D - Decision for Cheaters Tavern dated September 21, 1999
Case-law-presented: 671122 Ontario Ltd. v. Sagaz Industries Canada Inc.,
2001 SCC 59, [2001] 2 S.C.R. 983.;
Kelly v. Palazzo, [2005] O.J. no. 5365, (Ont. S.C.J.)
Re: Proposed Restaurant [1998] O.A.G.C.D. No. 267
2000 Bar, February 28, 2003 Decision of the Board of AGCO
Re: Blue Moon [2006] O.A.G.C.D. No 194, (Board of AGCO)
Duncan Ceiling & Wall Systems of Oshawa ltd v. Vin-Bon Retail systems Ltd., [2006] O.J. No. 368 (Ont. S.C.J.)
Gentles v. Toronto (City) Non –Profit Housing Corp., [2006] O.J. No. 1015, (Ont. S.C.J.)
Re: Cheaters Tavern [1999] O.A.G.C.D. No. 280
DECISION ON MOTION
The Board of the Alcohol and Gaming Commission of Ontario (“AGCO”) held a hearing on January 4 and 5, 2007 pursuant to a Notice of Proposal dated April 7, 2006 to suspend a licence and Supplementary Notices of Proposal dated May 23, 2006 and September 29, 2006 to revoke the licence issued to 1607310 Ontario Inc. (the “Licensee”) for premises operating as CABBAGETOWN RESTAURANT & BAR, 443 Parliament Street, Toronto, Ontario, M5A 3A1, licence number 21291.
At the request of Licensee’s counsel the Board agreed to reconvene to hear a motion to reopen the hearing and receive fresh evidence on behalf of the licensee. On the consent of all parties the motion was scheduled for February 12, 2007. Counsel provided their motion records and facta and Mr. Murphy produced an affidavit to the Board in advance of the hearing.
Licensee’s Counsel’s Position
Mr. Rosenthal presented the Licensee’s position as outlined in their motion of record in Exhibit A. The Licensee seeks to introduce five new witnesses and a petition in support of the Licensee in connection with the public interest aspect of the hearing. Counsel argued these witnesses possess a certain degree of knowledge or expertise about conditions and circumstances of the Cabbagetown Restaurant that were not previously presented in the hearing. Cabbagetown Restaurant is a place where those on the lower side of the economic scale can meet and socialize and have a beer. Mr. Zheng, the sole, officer, director and shareholder of the Licensee corporation, was not sophisticated in his initial attempts to present a defence to the allegations, in part due to his lack of understanding of the English language and financial constraints. Counsel argues this evidence is necessary in order for the Board to make a just finding in regard to the public interest.
Counsel disputed Registrar’s counsel’s suggestion that in order to reopen their case they must meet the twofold test outlined in 671122 Ontario Ltd. v. Sagaz Industries Canada Inc., 2001 SCC 59, [2001] 2 S.C.R. 983 (“Sagaz”):
….the trial judge applied a two-part test from Scott v. Cook, 1970 CanLII 331 (ON HCJ), [1970] 2 O.R. 769 (H.C.). First, would the evidence, if presented at trial, probably have changed the result? Second, could the evidence have been obtained before trial by the exercise of reasonable diligence?
The Licensee submits that such an onerous test is reserved for court proceedings and not matters before administrative agencies. It was noted that hearings before the Board are not held pursuant to the Rules of Civil Procedure.
Counsel submits the Licensee meets the Sagaz test; however a more appropriate standard would be the standard put forward in the decision of Cheater’s Tavern:
Hearings are not open ended, and the admission of evidence must terminate, without permitting new evidence, after all testimony has concluded, unless adequate explanation for the failure to provide it in the first instance is given.
In this case the Licensee has more than an adequate explanation.
Registrar’s Counsel’s Position
Ms. Taylor opposed the motion. She submitted the proposed evidence from the additional witnesses would not affect the outcome of the hearing. The proposed witnesses in her view do not reveal sufficient insight of either the community or Cabbagetown Restaurant to make their testimony relevant. It is for the most part opinion evidence from non-expert witnesses, and in many instances, opinions of individuals who do not reside in the community.
Ms. Taylor further argued that Licensee’s agent at the hearing, Mr. Dibello, is very experienced and presented a proper defence to the allegations. Ms. Taylor argues that Licensee’s counsel now seek to change their litigation strategy, after the case has closed.
Ms. Taylor argues that the Sagaz case is very material to the Board in deciding this motion. She argues that the Board’s rules in section 2.1 and 2.8 of its Rules of Practice mirror those under the Rules of Civil Procedure and in fact are based on the higher court rules. In addition, she relies upon Kelly v. Palazzo, [2005] O.J. no. 5365, (Ont. S.C.J.). She stated it is also important to note the Sagaz Supreme Court of Canada decision, made in 2001, is more recent then the Cheater’s Tavern decision of 1999.
Ms. Taylor argued as well that the Board has consistently given greater weight to the residents who live in the area of the licensed premise and would be most affected by the activities of the bar. Ms. Taylor argued that if the Board were to open the hearing to this additional evidence it may well have the impact of causing virtually a whole new hearing. The Board’s hearings could become never-ending, with requests to reopen coming from a number of licensees if they felt they could re-strategize their case.
Party to the Proceedings Position
Mr. Murphy objects to the reopening of the hearing for reasons outlined in his affidavit. He further stated that this was not an issue pitting affluent people against poor people and he resented that implication. He went on to state the residents who spoke at the hearing were in a better position to comment on the situation than the witnesses proposed by the Licensee. He took exception to the petition circulated and presented at the motion hearing. He has no knowledge of it. On close examination he submitted many who signed the petition were not from the neighbourhood.
Licensee’s Counsel’s Reply
Licensee’s counsel reiterated that the Board was not bound by Sagaz. It has the discretion under its Rules of Practice to consider new evidence. He submitted that the Licensee is the one who stands to lose far more than the community members as the Licensee can lose his livelihood.
Decision
The Board has reviewed and considered the arguments of all parties. The Board is satisfied that the test enunciated in Sagaz is the appropriate test to apply to proceedings before the Board. The objectives of fairness to parties and finality of the hearing process at stake in Sagaz are equally significant in any adjudicative proceeding, including those before this Board.
The Board DENIES the motion for the following reasons:
The Board is not convinced the additional evidence proposed would change the outcome of the hearing. Indeed, it is unclear the proposed evidence is directly relevant to the issues the Board must decide in this hybrid disciplinary/public interest proceeding. The Board is satisfied there has been a full and fair hearing of the matters before it in regard to the Cabbagetown Restaurant and the additional evidence proposed by the Licensee would have no material effect on the outcome of the hearing.
The Board is satisfied that the Licensee in this matter was adequately represented by Mr. Dibello. Victor Jiang waived his right to legal counsel at the hearing. The Board is satisfied that the proposed evidence was available at the time of the hearing and might have been produced with reasonable diligence on the part of the Licensee. The Board notes in this connection there was no affidavit from Mr. Dibello supporting Licensee’s counsel’s theory that the Licensee was not aware of this evidence earlier. Mr. Dibello is experienced in this type of hearing and knew what would be required. Securing a petition or canvassing for witnesses from the neighbourhood is standard pre-hearing procedure and part of normal practice.
Therefore the motion does not meet the Sagaz test.
The parties are therefore directed to provide their written submissions with regards to the hearing on January 4 & 5, 2007. The Board has received submissions from Registrar’s counsel dated January 15, 2007 and Party to the Proceedings dated January 12, 2007. Licensee’s counsel shall have fourteen (14) days, from the date of this decision, to make their submissions. Registrar’s Counsel and the Party to the Proceedings shall have seven (7) days for reply, if necessary.
DATED AT TORONTO THIS 19th DAY OF FEBRUARY, 2007.
ALEX MCCAULEY, BOARD MEMBER ALLAN HIGDON, BOARD MEMBER
AM/sm