Registrar, Alcohol and Gaming Commission Ontario v. 1633439 Ontario Inc., 2008 CanLII 35198

ALCOHOL AND GAMING COMMISSION OF ONTARIO

IN THE MATTER OF The: Liquor Licence Act, R.S.O. 1990, c. L.19, as amended

B E T W E E N:

Registrar, Alcohol and Gaming Commission Ontario

Registrar

-and-

1633439 Ontario Inc., O/A Coco Lezzone

Licensee

DECISION

Panel: S. Grace Kerr, Board Member Beryl Ford, Board Member

Decision Date: May 16, 2008

Hearing Location: Toronto, Ontario

Alcohol and Gaming Commission of Ontario 90 Sheppard Avenue East, Suite 300 Toronto ON M2N 0A4 Phone: (416) 326-0366 Fax: (416) 326-5566 Toll Free In Ontario: 1-800-522-2876 Website: www.agco.on.ca

Appearances

Registrar, Alcohol and Gaming Commission ) Daniel Alakas, Representative

1633439 Ontario Inc., Licensee ) Adam Vassos, Representative

Allegations

1. A hearing into Notice of Proposal number 15778, dated November 19, 2007, to suspend liquor licence number 201904, issued to 1633439 Ontario Inc., (the “Licensee”) operating as Coco Lezzone, 602 College Street, Toronto, Ontario, M6G 1B4, for seven days, on the basis of alleged violations of sections 43 and 52 of Ontario Regulation 719/90 (the O. Reg) made pursuant to the Liquor Licence Act (LLA), was held on February 25, 2008, in the City of Toronto.

Decision

2. After considering the evidence and submissions the Board finds the Licensee violated sections 43 and 52 of the O. Reg. Reasons follow.

Preliminary Matters

3. On consent, witnesses were excluded from the proceedings.

Registrar’s Evidence

4. Exhibit 1 is a Temporary Extension Liquor Licence (TEL Licence) issued for Coco Lezzone, the “Premises” or the “Establishment”, for an event known as Taste of Little Italy on June 15, 16, and 17, 2007. The TEL licence was for an area of 7 feet x 20 feet and a capacity of 11 persons.

5. Devin Sookdeo is a Liquor Inspector with the AGCO. On June 15, 2007, Inspector Sookdeo and Inspector Rebecca Sargent were conducting routine liquor licence inspections in the area. The annual Little Italy Festival was in progress. The streets were crowded and the roadways were closed to vehicles.

6. The inspectors entered the temporary patio area, located at the front of the Establishment and separated from the roadway by a temporary fence, from the street at 10:09 p.m. and remained there for approximately 10 minutes. Entry to the Establishment was only possible through the temporary patio.

7. The Inspector counted 22 persons on the patio including one staff person. He only counted persons seated or standing and not those who might be walking through on their way inside the Establishment.

8. After checking with Inspector Sargent, who had independently counted 21 persons on the patio, Inspector Sookdeo approached the principal of the Licensee, Mr. Steven Salari. He informed him about his count and the breach of the TEL licence. Mr. Salari looked surprised and said that he was “no where near” the 34 persons allowed. Inspector Sookdeo informed him the TEL licence was for a total capacity of 11 people. Mr. Salari said he had always been licensed for 34 persons in the past and that there must be some mistake.

9. Mr. Salari entered the premises and returned with his TEL licence. He was very surprised to see that it had been issued for a total patio capacity of 11 persons. Mr. Salari once again said there must be some mistake. He had always been licensed for 34 in the past and nothing had changed.

10. The Inspector informed Mr. Salari the TEL licence must be posted in a visible location. Further, Mr. Salari should have reviewed the TEL licence for errors when it arrived from the AGCO. Mr. Salari was upset and asked if the TEL licence could be adjusted to allow for the additional capacity for the remaining two days of the Festival, adding this was the busiest event of the year for the establishment. Inspector Sookdeo advised that, as the AGCO Licensing Department was closed for the weekend, it was not possible to amend the TEL licence. He told him he was obliged to comply with the TEL, that Inspectors would be conducting inspections in the area over the weekend, and that he would return the following evening.

11. In cross-examination, Inspector Sookdeo confirmed that some people were standing and some were seated and eating. The Inspector agreed the extension patio is much larger than the establishment’s permanent patio which has a capacity of eight persons. He agreed it was possible that Mr. Salari could have made the mistake in believing the premises was licensed for more than 11 persons based on past practice.

12. Inspector Sookdeo did not ask Mr. Salari to remove patrons immediately. He thought Mr. Salari understood that he must come into compliance and would correct the problem. Mr. Salari was cooperative when he returned the following evening and the overcrowding problem had been corrected. The TEL licence was also posted in the patio area and visible. He had no concerns with safety; it was the issue of non-compliance with the TEL licence. Inspector Sookdeo told Mr. Salari that he would report the ‘over capacity’ on the patio and ‘not posting the TEL permit’ in accordance with the LLA to the AGCO.

13. Inspector Rebecca Sargent’s testimony was consistent with Inspector Sookdeo’s evidence in all material respects. She agreed she had counted 21 persons on the patio and was in training on the night in question.

14. Jade Leadbetter is a Liquor Inspector with the AGCO. She was working in partnership with Detective Constable Mike Burns of the Toronto Police Services as part of a project patrolling the area during the Little Italy Festival.

15. She arrived at the establishment at 12:15 a.m. on June 16, 2007 and observed that the patio was extremely busy. Inspector Leadbetter used a mechanical counter to record 27 persons on the patio. The majority were seated and she did not recall seeing staff. Inspector Leadbetter counted everyone on the patio but did not count people who were walking through the patio to enter the establishment. She advised Mr. Salari of her findings. Mr. Salari said he had made a mistake in the calculations for the extension when he submitted his application and this resulted in a lower capacity than in previous years.

16. Inspector Leadbetter did not discuss safety issues with the Licensee as she didn’t recall having a concern with safety. She advised Mr. Salari that he must comply with the permit but did not give him a time-frame to do so. Inspector Leadbetter explained she did not have the authority to change the permit and it was his responsibility to adhere to it for the remaining dates. She had no recollection of whether the TEL was posted.

17. In cross-examination Inspector Leadbetter agreed her count could have included people from inside the establishment who were coming onto the patio to smoke. She was not aware if people she counted were staff or not.

Licensee’s Evidence

18. Vito D’Angelo is a regular customer of Coco Lezzone; he is a salesperson by profession. Mr. D’Angelo was at Coco Lezzone on the evening of June l5, 2007. He arrived at approximately 10:00 p.m. with business friends who were his guests. They chose a table on the patio and sat close to the sidewalk.

19. It was extremely busy at the restaurant due to the Festival; they placed their dinner order. Before their meal arrived, Mr. Salari approached their table and told him the Liquor Inspectors had advised him that he was over capacity and had to reduce the number of patrons on the patio to comply with his TEL. Mr. Salari informed him that once they finished their meal they would have to leave the patio. They did this and left about an hour and a half later.

20. While waiting for his meal he noted staff removed the table next to him from service and folded the chairs. The staff was not allowing anyone else onto the patio and he overheard them tell prospective patrons they were not seating anyone else on the patio.

21. In cross-examination, Mr. D’Angelo agreed he was a friend of Mr. Salari and a regular customer at Coco Lezzone. He was only aware that the Liquor Inspectors had been in because Mr. Salari told him and asked him to leave the patio area.

22. Joseph Alouche has been the Manager of Coco Lezzone for the past 2 years. His role includes all aspects of running the establishment. It is a family restaurant, operating seven days a week. He was working on June l5, 2007, and recalled the evening as particularly busy because of the annual Little Italy Festival.

23. Mr. Alouche and another staff member completed the application for the TEL licence. He was not aware of any changes to the application from previous years. Mr. Salari signed the application and when the TEL licence arrived, it was filed in an envelope in the bar near the cash register with other documents.

24. On June l5, 2007, in preparation for the Festival, he and other staff members set up the tables and chairs on the patio to accommodate 34 patrons. This was the same capacity they had had in the past. There had been no discussion on the capacity and it was assumed it was the same as they had always had.

25. Mr. Alouche was present when the Inspectors arrived on June 15, 2007. He did not overhear their conversation with Mr. Salari as he was approximately 12 feet away. After the Inspectors left, Mr. Salari told him that there was a problem and they were over capacity on the patio. Mr. Salari instructed him not to seat any more patrons on the patio and to remove tables and chairs as soon as possible after the customers who had ordered or were eating their dinner had finished their meal. Mr. Salari instructed him to allow people to finish their meals because he felt asking them to leave in the middle would upset them and cause even more problems. After the tables and chairs were removed from service they were stacked and not allowed back into use.

26. Patrons were coming in and out to smoke or stand around. Mr. Alouche told them that they could not remain on the patio. Mr. Salari also told Mr. Alouche to be sure that they set up the patio for 11 people the next day because they must “take care of the situation.” Mr. Alouche stated they had obviously made a mistake with the numbers on the TEL licence.

27. In cross-examination Mr. Alouche stated that he was not aware there was a second inspection on June 15, 2007. It was extremely busy, the busiest time of the year. People were coming and going, back and forth, across the patio. Some were smoking or mingling with other patrons; others were looking at the menu for the restaurant. He was not aware that people coming and going were part of the count for the patio and thought only patrons seated were counted.

28. Victor Dedvukaj has been a cook at Coco Lezzone for the past eight years. He was working on June 15, 2007. The Festival is the busiest time of the year in the area with approximately 150,000 to 500,000 people visiting the area. Mr. Dedvukaj estimated that there were 200,000 people on College Street on the evening of Friday, June 15, 2007. That day, Mr Dedvukaj was assigned to work outside at the barbecue on the patio which is located about three feet from the entrance to the patio off the sidewalk. Every year they extend the patio to accommodate extra patrons for the Festival. The TEL licence for the patio extension was for the same number of people every year.

29. Mr. Dedvukaj was cooking at the barbecue when the two Inspectors arrived. They asked for the owner. He informed Mr. Salari that the Inspectors wanted to speak to him. He overheard them ask Mr. Salari for the TEL licence. Mr. Salari went inside the restaurant and returned with it. He noticed that Mr. Salari’s expression had changed when he came back onto the patio.

30. Mr. Salari spoke to the Inspectors for about 10 – 15 minutes. During this time people were coming onto the patio and asking for menus and Mr. Dedvukaj was telling them there was a wait of approximately 45 minutes to 1 hour for a table inside the restaurant. After the Inspectors left, Mr. Salari told Mr. Dedvukaj they had a problem and that he must stop cooking right away. He was told to shut down the barbecue. Mr. Salari said the Inspectors had advised him that they were over the capacity on the patio.

31. Mr. Salari also told Mr. Dedvukaj that when people finished eating to take down the tables and put the chairs on top of the tables. He closed down two tables in the first 30 minutes. No new patrons were seated after the Inspectors left. Any patrons remaining on the patio were still eating or had ordered their meals. When he approached customers, they told him to leave them alone and let them eat their meals. The patrons were unhappy to be told that they would have to leave the patio after they finished eating. By 12:30 p.m. they had cleared everyone from the patio tables.

32. As the entrance and exit into the Premises was through the patio, Mr. Dedvukaj continued to tell people they could not stay on the patio. People continually asked him why they were closing the patio and were becoming angry with Mr. Dedvukaj as they could see the empty tables and chairs, yet he wouldn’t allow them to sit on the patio. He told people they couldn’t stand around on the patio because they didn’t have a licence for it and they had to close the patio. He feared that he would be punched because of his attempts to control the entrance and patio and became increasingly nervous about his own safety.

33. In cross-examination Mr. Dedvukaj stated that after he closed down the barbecue he remained at the entrance on the patio until 2:00 a.m., attempting to control the entrance and exit to and prevent people from gathering on the patio. Staff could not move tables from the patio into the restaurant as it was already crowded with patrons. Mr. Dedvukaj also tried to control the people coming outside to smoke from inside the restaurant. He encouraged people to go onto the street to smoke and not stand around on the patio. He didn’t realize that these people, who were socializing and smoking, were counted in the total capacity.

34. Mr. Dedvukaj confirmed that TEL licences had been issued in the past few years for the patio and thought the capacity was for 34 patrons; however, he did not check it.

35. Steven Salari, the principal of the corporate Licensee, has owned and operating Coco Lezzone since 1999. The establishment, a family restaurant, is licensed for 143 patrons inside the premises and a capacity of eight on a small outside patio. It has a small bar and caters to 130 – 150 diners on most weekends.

36. Mr. Salari stated that in 2007, he applied for a TEL licence for an extension to the patio for the event known as the Little Italy Festival. In previous years, the TEL licence has been for an additional 34 persons on the extended patio. He stated the application had always been the same and never changed.

37. Exhibit 3 shows TEL licences issued for an extended patio area at Coco Lezzone for the following events:

June 18, 19 and 20, 2004 A Taste of Little Italy

September 25, 2004 Italian Fiera Festival

June l7, l8, and 19, 2005 A Taste of Little Italy

August 26 and 27, 2005 Fiera 2005

June l6, 17, and 18, 2006 A Taste of Little Italy

September 1 and 2, 2007 Fiera

38. Each TEL licence above is for a patio measuring 23 x 18 feet with a capacity of 34 persons.

39. Exhibit 4 is a TEL licence for the Little Italy Fiera Festival between September 2, 2006 and September 3, 2006. The dimensions of the extension on that occasion measure 20 x 10 feet. The application was approved and a TEL licence was issued for a capacity of 16 persons. Mr. Salari did not know why those dimensions were on this particular TEL licence because the patio is always extended to the same size. He could not explain the difference and was not aware that these dimensions or the capacity allowed were different from his previous TEL licences.

40. Mr. Salari took responsibility for an error made on the 2007 TEL application for the Little Italy Festival event. He had no idea why the 7 feet x 20 feet dimension was used. He was out of town when the TEL licence arrived and left it to staff to check. He assumed the capacity was for the same as the past.

41. Mr. Salari was shocked when the Inspectors told him his TEL licence was for an additional 11 persons on the outside patio. When he retrieved the TEL from inside the premises he ‘almost freaked out’ when he saw the set capacity was for 11 persons. He told the Inspectors it was an “obvious mistake,” and asked them to change it. They said the licensing department of the AGCO was closed for the weekend and nothing could be done. He was told to comply with the TEL licence and reduce the capacity on the patio to 11 persons as he was in violation of that licence. The Inspectors said they would be back the next evening. He thought he was being warned and had until the next day to get things corrected.

42. Mr. Salari testified that people were still eating their meals on the patio; some had just ordered food or drinks. While angry, he told staff immediately that no new people were to be seated on the patio. He also told Mr. Dedvukaj to stop cooking and close the barbecue down. He ordered staff to start taking tables down after people had finished eating. He stated that he took immediate action to get into compliance. The Little Italy Festival is the busiest time of the year for his business and to reduce the capacity from 34 persons to 11 persons on the extended patio resulted in considerable lost revenue over the 3 day period.

43. Mr. Salari did not deny they were over the capacity of 11 persons, but he was mistakenly under the impression that his capacity was 34 had not reached that capacity. Extended patios for establishments that adjoin the Licensee’s patio are all the same size. They project across the sidewalk and extend towards the roadway for these special community events. He made an honest mistake, yet felt no mercy from the Inspectors. He could not push people through the patio or onto the roadway to smoke, and Mr. Dedvukaj was making sure no new customers were seated on the patio. By the time the second Inspector arrived later that night, he had made the decision to shut the patio down as soon as possible, even though it was a financial cost to his business.

Registrar’s Submissions

44. Counsel for the Registrar submitted that the Licensee had been advised by Inspectors that he was over capacity and must rectify the situation. The Inspectors did not tell or imply to Mr. Salari he had until the next day to do this; the Inspectors he would immediately comply. Yet, when the second Inspector arrived on the premises later in the evening, the numbers on the patio had increased from 22 to 27.

45. Mr. Salari admitted to a mistake on the TEL application and not checking it for detail when the TEL licence was issued. This is not the first time a mistake has been made on a TEL application; the TEL licence issued for September 2 and 3, 2006 also provided different dimensions and resulted in a reduced capacity. Mr. Salari had no explanation for this error. Registrar’s counsel submits that the Licensee did not demonstrate compliance but made a business decision to allow the overcrowding to continue rather than disrupt his customers. The evidence is sufficient to establish a breach of sections 43 and 52 of the O.Reg.

46. Mr. Alakas submits the Licensee was responsible for checking the TEL licence and being pro-active to prevent violations. Although sympathizing that the Licensee lost business because of the capacity issue, the error resulted from Mr. Salari’s lack of attention. Overcrowding can be a safety issue and is a serious concern for the Registrar. Counsel for the Registrar requested the Board order a suspension of five to seven days for the Licensee’s violations of the LLA.

Licensee’s Submissions

47. Mr. Vassos notes there is no evidence to support a finding the TEL licence was not posted and visible inside the establishment. None of the Inspectors entered the Premises.

48. With respect to overcrowding, the Licensee admits overcrowding and accepts responsibility for the violation. The Licensee had applied for and received TEL licences seven times in the past. On six of those occasions the TEL licence was exactly the same: a capacity of 34 persons on the extended patio. The Licensee mistakenly assumed the TEL licence issued in 2007 was for the same capacity as granted on those six prior applications. There is no dispute the Licensee was told to bring the capacity to 11 persons on the patio to comply with the conditions of the TEL licence. However, Mr. Salari was under the impression based on the discussions with and comments by the Inspectors about returning the next day that he had until the next day to rectify the problem. There is no evidence to suggest the Inspectors on the first visit told him he must comply immediately.

49. Witnesses testified that Mr. Salari took immediate and reasonable action by ordering staff to remove tables and chairs when they become available and to allowing new patrons on the patio. He cooperated with the Inspectors. The patio entrance was the only entrance to and from the establishment as well as the extended patio. People were going in and out of the restaurant all evening. Licensee’s counsel argues that it was not realistic to expect Mr. Salari to ask people who were seated on the patio to stop eating and leave immediately. If he had been asked to do this, however, he would have immediately complied, although it would have been difficult.

50. Counsel for the Licensee also submitted that a mistake was made, and that the Licensee has taken full responsibility for it and will ensure this does not happen again in the future. The reduced capacity caused the Licensee a great financial loss on the busiest weekend of the year. Furthermore, there were no safety issues on the patio due to the over capacity.

51. Mr. Vassos urged that there is no evidence to support a finding under section 52 of the O. Reg and requested there be no finding. With respect to section 43 of the O. Reg. Mr. Vassos notes that in the 10 years the Licensee has operated Coco Lezzone, these are the first charges of overcrowding. Mr. Salari cooperated with the Inspectors and made a great effort to reduce the numbers on the patio soon after the Inspectors had left the premises on the first visit. Mr. Salari had the impression he had until the following evening to comply with the TEL licence as the Inspectors told him they would return the following evening to check for compliance. The Licensee lost a considerable amount of business over the duration of the Little Italy Festival event to neighbouring establishments because of his limited seating capacity on the patio, which he cannot recover. Thus, to suspend the licence of Coco Lezzone would only serve to punish the Licensee twice for the same mistake. He asked the Board to issue a warning to the Licensee.

Decision

52. The Board has carefully considered the evidence presented. It is clear Mr. Salari was under the honest, although mistaken impression the TEL licence was for a total capacity of 34 persons. His error was not discovered until the routine inspections by the Liquor Inspectors.

53. The Licensee is responsible for ensuring the TEL application was submitted correctly and must bear the consequences of his failure to do so and failure to check the TEL licence upon its arrival and before opening the extended patio to patrons.

54. On June 15, 2007, at 10:09 p.m., an AGCO inspection produced a count of 22 on the extended patio and, on June 16, 2007, at 12:21 a.m., a second and separate AGCO inspection determined that 27 persons were on that patio. Even if some of the patrons counted on the second count were not seated on the patio, the Board is satisfied based on Inspector Ledbetter’s evidence more than 11 patrons remained on the patio approximately 2 hours after the Licensee was advised the patio was over crowded. In the circumstances the Board FINDS the Licensee in violation of s. 43 of the O. Reg.

55. Furthermore, the legislation requires that the TEL licence be posted in a conspicuous place to which it applies, which, in this case, could have either been on the extended patio or in the establishment. None of the Inspectors entered the establishment to check if the TEL licence was in fact posted. In his evidence Mr. Salari forthrightly acknowledged that he had retrieved the TEL licence from an envelope, which held other documents and was kept near the bar. Mr. Alouche testified that it was filed in an envelope when it was received. As such, the evidence is not clear. There is no evidence that the TEL licence was posted inside the premises on the day in question. The Board is therefore unable to find, on the balance of probabilities, that the Licensee also violated s. 52 of the O. Reg and DISMISSES that allegation.

56. With respect to sanction the Board accepts Mr. Salari was credibly in disbelief when he learned the patio was over capacity. Overcapacity is a serious violation that can involve safety issues for the public and staff of an establishment. Overcrowding of an establishment can result in serious consequences for the licence holder and jeopardize public safety. The Board does not take this violation lightly.

57. In determining sanction, however, each case must be decided on its own facts. Here, the Board heard testimony from Inspectors there were no safety issues caused by the overcapacity. While over the capacity specified in the TEL licence the patio was under capacity previously permitted given its dimensions. As such, overcrowding and its related safety issues do not factor as significantly in the Board’s decision on sanction in this case as it might in others.

58. Furthermore, the Board also concludes this was a careless but honest error on behalf of staff and Mr. Salari. The Board finds that Mr. Salari is genuinely remorseful and has learned from this significant and costly mistake and his failure to attend to the details of his responsibilities under the law. The following facts support this conclusion. Mr. Salari cooperated with the Inspectors during their inspection and, immediately upon their leaving, set about to try and correct the problems. He acted in a manner he believed reasonable in the circumstances and in keeping with his understanding of his obligations. He informed staff of the problem they had with the TEL licence, ordered the chef to close down the barbecue on the patio and not seat any other patrons on the patio, and had staff remove tables and chairs as they become vacant after people who had ordered food and drinks had finished their meals.

59. Further, as the extended patio provides the only ingress and egress onto it and into the establishment, the Board accepts the Licensee’s evidence that staff were making a concerted effort to control the number of people on the patio and that people were not allowed to loiter or smoke on the patio, but were re-directed to the sidewalk to smoke in order to try and bring the establishment into compliance with the terms of the TEL licence. The evidence shows that monitoring the patio was a difficult challenge for staff after the decision was made to close it down; people were rude to staff, who felt threatened when they refused entry to individuals.

60. The Board has also considered that this is the first time that Coco Lezzone has been found in violation of the LLA and its regulations in its 10 years of operation.

61. For all of these reasons, the Board concludes that a suspension of the Licensee’s licence for two (2) days is appropriate and serves the purposes and principles of general and specific deterrence. The Licensee must take responsibility to ensure that future TEL licence applications are accurately completed before they are submitted to the AGCO. It must also carefully review licensing documents when they arrive from the AGCO prior to opening a licensed area of an establishment to ensure compliance. Assumptions must not be made based on past practice. Finally, by law, licensing documents must be posted in a conspicuous place in the premises to which they applies. The Licensee is responsible for complying with the straightforward requirements of the law in this regard.

ORDER

61. The Board ORDERS that liquor licence number 201904, issued to 1633439 Ontario Inc., operating as Coco Lezzone, 602 College Street, Toronto, Ontario, M6G 1B4, be suspended for a period of TWO (2) consecutive days.

62. Licensee shall submit proposed suspension dates in writing to the Manager of Hearings, Hearings Department, Alcohol and Gaming Commission of Ontario at the address on the front of this decision within seven (7) days of the date of this decision. The Board will set suspension dates without further notice to the Licensee if proposed dates are not provided within that time. The suspension must be served on days the establishment normally operates. The suspension may not start earlier than twenty (20) days from the date of this decision and must be completed within ninety (90) days of the date of this decision.

DATED AT TORONTO THIS 16^th DAY OF May , 2008

BERYL FORD, BOARD MEMBER S. GRACE KERR, BOARD MEMBER

BF/ee