Registrar, Alcohol and Gaming Commission of Ontario v. 1744671 Ontario Ltd. O/A Liongate Lounge, 2009 CanLII 55584

ALCOHOL AND GAMING COMMISSION OF ONTARIO

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

BETWEEN:

Registrar, Alcohol and Gaming Commission of Ontario (Registrar)

-and-

1744671 Ontario Ltd. O/A Liongate Lounge (Licensee)

DECISION

Panel: Patricia McQuaid, Vice-Chair, AGCO Jacqueline Castel, Board Member

Decision Date: August 14, 2009 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: Richard Kulis, Representative 1744671 Ontario Ltd., Licensee: Louis Rajnauth, Representative

Allegations

1A hearing into a Notice of Proposal number 16822 dated November 12, 2008 to suspend liquor licence number 801840 (the "Licence") issued to 1744671 Ontario Ltd. (the "Licensee") operating as LIONGATE LOUNGE, 1957 Kennedy Road, Building "D", Scarborough, Ontario, M1P 2L9 (the "establishment" or "premises"), on the basis of an alleged breach of condition (1) on the Licence, as well as alleged violations of clause 61(1)(a) of the Liquor Licence Act ("LLA") and paragraph 50(c) and subsection 45(2) of Ontario Regulation 719/90 ("O.Reg") made pursuant to the LLA, was held on July 15, 2009 in the City of Toronto.

Decision

2After considering all the evidence and submissions the Board finds the Licensee breached condition (1) on the Licence and violated subsection 45(2) and paragraph 50(c) of the O.Reg. The Board accepted the withdrawal of clause 61(1)(a) of the LLA. Reasons follow.

Preliminary Matters

3Mr. Kulis advised the Board that the Registrar wished to withdraw the allegation of a violation of clause 61(1)(a) of the LLA. Further, he advised that there was essentially an agreement on the facts, though both parties would be calling one witness each to give evidence before the Board. The main issue to be decided was the appropriate sanction and the parties wished to make oral submissions in that regard.

Registrar's Evidence

4Stephen Hetherington has been an Alcohol and Gaming Commission of Ontario ("AGCO") inspector for approximately three years. He attended at the licensed premises on June 25 and August 3, 2008.

5On June 25th he arrived at 11:38 p.m. His attendance was instigated by an anonymous complaint to the effect that the owner, Mr. Jean Francois had been charged with assault by York Regional Police and had not disclosed this to the AGCO as is required by a condition on his Licence.

6Upon his arrival, he located Mr. Jean Francois and asked to speak with him in his office which was located in the basement. As they proceeded to the office, Mr. Hetherington noted that an illuminated fire exit door was dead bolted shut, contrary to the Ontario Fire Code, prescribed under the Fire Protection and Prevention Act. He did not check whether this matter had been rectified on August 3rd though stated that he has subsequently cited this particular infraction.

7Regarding the assault charge, Mr. Hetherington told Mr. Jean Francois that his information from York Police was that these charges were laid on March 17, 2008, and that the AGCO had not received any written notice from him within five days of the charges, as required by the Licence condition. Mr. Jean Francois responded that his understanding was that his lawyer had notified the licensing officer by phone. Mr. Hetherington stated that a phone call would not satisfy the condition as written notification is required.

8His second attendance on August 3, 2008 was a routine spot inspection, with Inspector McFadden. Upon entering, they did a general walk-through of the premises. They detected a lingering and faint smell of marijuana. They could not locate its source on the main floor so they proceeded to the basement. There, in the hallway to the washrooms, the smell was stronger. Inspector Hetherington opened the door to the men's washroom. The smell of burning marijuana was immediate. He observed two males openly smoking marijuana joints and a third was rolling one. Within 2-3 seconds, one of the males pushed the door shut, stating that he, Mr. Hetherington, was not welcome there.

9Mr. Hetherington then proceeded back upstairs, advising the security person situated at the top of the stairs what he had seen. The security person immediately went downstairs. At the front entrance, he spoke to security staff and asked to speak to Mr. Jean Francois. He then advised Mr. Jean Francois of the infraction and stated that he would be submitting a report to his supervisor.

10On cross-examination, Mr. Hetherington stated that there were identifiable security though he could not verify their number, as well as paid duty officers working at the premises that evening.

Licensee's Evidence

11Jean-Ardy Jean Francois has been the principal of Liongate Lounge for almost three years. Mr. Jean Francois described his ongoing issues with his ex-wife and son, specifically an argument and physical altercation with his wife and son at his home on March 15, 2008. Then, on March 17th, police attended at his residence to interview him regarding an alleged assault on his son on March 15th. He went with police officers to the station where he was questioned by a detective for approximately one hour after which he was allowed to leave. The police did not press charges at that time. His problems continued the next day when his ex-wife, son and three other men showed up at Liongate Lounge, and, he alleges, broke into his office and studio, stealing money and other items. He called the police, however, they did not arrest his wife. He did press charges.

12On March 19, 2008 he signed the condition which is in issue at the hearing. At that time, he was unaware of charges against him. He was charged subsequently. His recollection is that he left messages for his lawyer regarding the possibility of assault charges. In his mind, the failure to notify the AGCO was an unfortunate oversight and not intentional. His recollection is that charges were laid against him in late March or early April.

13Charges are outstanding against both him and his ex-wife with court attendances for both of them scheduled within the next month.

14Regarding the deadbolt on the fire exit, Mr. Jean Francois stated it was on the exit as observed by the inspector. It was placed on that particular exit because there had been several attempted break ins. This particular door was vulnerable because of its location. He also advised the Board that this exit is not in an area of the basement to which patrons have access. A wall separates two areas of the basement: the patron washrooms are not in the side where the dead bolted exit is located. He believes that there are still exit doors with deadbolts in that area, again, for security reasons, but the deadbolt on the exit observed by Mr. Hetherington was, he thought, removed.

15Mr. Jean Francois stated that he could not deny the inspector's findings regarding the use of marijuana on the premises on August 3rd, however, he does have significant security measures in place and a policy to eject anyone smoking in the premises if they refuse to leave. On August 3rd, when advised that patrons were smoking marijuana, security acted promptly and went to the washroom to deal with it, but the patrons had gone. He was in his office when the inspectors arrived, but he did detect the odour of marijuana when he went downstairs to investigate.

Reasons and Analysis Regarding Findings

16As Mr. Kulis and Mr. Rajnauth stated in their submissions, Mr. Jean Francois is to be commended for his forthrightness, or, as Mr. Rajnauth stated, being so brutally honest that some of his evidence may not be in his best interest.

17The Board did, in an oral decision, make findings of violations of each of the breaches alleged in the NOP, except for clause 61(1)(a) of the LLA, the withdrawal of which was accepted by the Board.

18The condition at issue reads as follows:

"Jean-Ardy Jean Francois shall inform the Deputy Registrar in writing within 5 days concerning any and all charges, convictions, findings of guilt, including where an absolute or conditional discharge is granted or other disposition of any charges under any legislation (including, but not limited to, the Criminal Code of Canada and the Ontario Highway Traffic Act) in any jurisdiction."

19A failure to disclose in accordance with its terms is clear. There may have been some confusion in Mr. Jean Francois' mind given his unfortunate personal situation, however, what is clear is that he was charged with assault by late March or early April. The Deputy Registrar was not informed by him prior to June 25, 2008. Mr. Jean Francois had recently agreed to this condition on his Licence – on March 19, 2008 and therefore ought to have been cognizant of the obligation it imposed. It was incumbent upon him to abide by it, and he did not. No written notification was sent and it is questionable whether verbal notice was ever received. The Board therefore finds a breach of this condition on the Licence.

20The issue regarding the dead bolt might be considered "minor" in nature, but for the possible ramifications in the event of a fire. Mr. Jean Francois was quite candid. He put dead bolts on certain exit doors because of security concerns. Inspector Hetherington made observations of one exit with a deadbolt, in contravention of the Ontario Fire Code. While the potential consequences of a deadbolt on the exit when the exit is located in an area to which patrons have little or no access may be less serious, it is nonetheless a contravention of paragraph 50(c) of the O.Reg. It is in the premises over which the licence holder has control, and the Board so finds.

21The final allegation is the violation of subsection 45(2) of the O.Reg. Again, Mr. Jean Francois was honest and forthright. He did smell the marijuana when he went downstairs. He did not dispute Mr. Hetherington's observations. He asserts, however, that he was diligent in trying to prevent the behaviour, employing many security personnel and installing 45 surveillance cameras. But on this evening, Inspector Hetherington, upon entering the establishment, detected a faint smell of marijuana. He essentially did no more than follow his nose to the source of the smell. Security posted at the top of the stairs to the washroom appears to have detected nothing or ignored it though it was his responsibility to be alert to this issue as there were no, nor could there be, cameras in the washrooms. The Licensee's employees ought to have known what was occurring in the washroom area given that the smell of marijuana was apparent to anyone entering the premises and there was security on duty who was far closer to the patrons smoking the marijuana. The Board therefore finds a violation of subsection 45(2) of the O.Reg.

Reasons and Analysis on Sanction

22Having made an oral decision on findings, the Board then heard submissions on sanction which the Board has carefully considered. The Board agrees with counsel; there are several mitigating factors which must be considered in this instance. They are: Mr. Jean Francois' honesty and forthright demeanour, the emotional upheaval that seems apparent as a result of a fractious relationship with his ex-wife and son, the security measures he has in place at the establishment and the prompt action taken when he was alerted to the marijuana use in the premises. As well, this is the Licensee's first appearance before the Board.

23Mr. Kulis has submitted, given these factors, and the withdrawal of the allegation of a violation of clause 61(1)(a) of the LLA, that a 7-14 day suspension would be appropriate, with a further condition that Mr. Jean Francois report to the Deputy Registrar the outcome of the criminal proceeding within five days of its final determination.

24Mr. Rajnauth submits, given these same factors, that a suspension at the lower end of the range, at seven days, would be appropriate.

25The Board has weighed these mitigating factors and concludes that a seven day suspension is appropriate. Mr. Jean Francois' failure to comply with the condition was not, on the evidence, borne of any intention to mislead, but rather the apparent consequence of a very difficult time and on the evidence there does appear to have been an effort, though unsuccessful, to advise the Deputy Registrar through his request to his lawyer. It is important for the Deputy Registrar to be apprised of the outcome of the current criminal proceedings, so to that end, the Board is prepared to impose the condition proposed by Mr. Kulis, to which Mr. Rajnauth consented.

26Mr. Jean Francois is now aware, too, that regardless of security concerns the answer cannot be to affix deadbolts to fire exits. Some have been removed and the Board trusts that any remaining ones will also be removed given what has transpired at this hearing.

27Regarding the marijuana use, the Board notes that once alerted to the problem, the Licensee responded quickly and with concern. His security measures are commendable and with increased diligence this is not an incident that the Board expects should recur. The Licensee has shown remorse. The need for specific deterrence, while always a factor for the Board, is not as forcefully required in this instance.

Conclusion

28For the reasons given, the Board FINDS the Licensee breached condition (1) on the Licence and violated paragraph 50(c) and subsection 45(2) of the O.Reg.

29The Board ORDERS that liquor licence number 801840 (the "Licence") issued to 1744671 Ontario Ltd. operating as LIONGATE LOUNGE, 1957 Kennedy Road, Building "D", Scarborough, Ontario, M1P 2L9, be suspended for a period of SEVEN (7) consecutive days.

30The Board further ORDERS that the following condition shall be added to the Licence:

"The Licensee shall report to the Deputy Registrar, in writing, the outcome of the proceedings against him (arising from the charges laid in March/April, 2008) within 5 days of its final determination."

31The 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 14th DAY OF AUGUST, 2009.