Registrar, Alcohol and Gaming Commission of Ontario v. Mac’s North End Pub Inc., 2011 CanLII 45096

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 of Ontario

Registrar

-and-

Mac’s North End Pub Inc. o/a Mac’s North End Pub

Licensee

DECISION ON FINDINGS

Panel: Patricia McQuaid, Vice-Chair Grace Kerr, Board Member

Decision Date: June 14, 2011

Hearing Location: Hamilton, Ontario

Alcohol and Gaming Commission of Ontario 90 Sheppard Avenue East, Suite 300 Toronto, Ontario 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 ) Aviva Harari, Representative

Mac’s North End Pub Inc., Licensee ) A. Douglas Burns, Representative

Authorities

669607 Ontario Ltd. (c.o.b. Carrera Fine Cars) (Re), [1998] O.C.R.A.T.D. No. 45 (Ontario Commercial Registration Appeal Tribunal)

1166134 Ontario Inc. (c.o.b. Nashville North) v. Ontario (Alcohol and Gaming Commission), [2006] O.J. No. 2567 (Ontario Superior Court of Justice, Divisional Court)

Stetler v. Ontario (Agriculture, Food and Rural Affairs Appeal Tribunal), 2005 CanLII 24217 (ON CA), 2005 Carswell Ont. 2877 (C.A.)

Allegations

1. A hearing into Notice of Proposal number 18331, dated October 6, 2010 to revoke liquor licence number 91325 issued to Mac’s North End Pub Inc. (the “Licensee”), operating as MAC’S NORTH END PUB (the “establishment” or the “premises”), 468 James Street North, Hamilton, Ontario, L8L 1J1, on the basis of an alleged violation of section 6 of the Liquor Licence Act (“LLA”) was held on March 31, 2011 in the City of Hamilton.

Decision

2. After considering all the evidence and submissions the Board FINDS that the Licensee violated subsection 6(2)(a) of the LLA. It dismisses the allegation that the Licensee violated subsection 6(2)(d) of the Act. Reasons follow.

Preliminary Matters

3. There were no preliminary matters.

Registrar’s Evidence

4. Sean Kirkey was the Registrar’s only witness. He is a Collection Officer with the Ontario Ministry of Revenue (“the Ministry”), Collection and Compliance branch. He has been with the Ministry for twelve years.

5. He detailed the responsibilities of retail vendors under the Retail Sales Tax Act (the “RSTA” or the “Act”) and confirmed that, pursuant to section 22 of the Act, retail sales taxes collected are deemed to be held in trust for the Crown.

6. Also, this Licensee was required to remit returns semi-annually, and amounts owing under those returns were to be paid in full upon filing.

7. Even if a vendor does not have funds to remit, it is better for them to file the return. At least then they will be in satisfaction of one of the two (i.e. filing and remittance) requirements.

8. This Licensee’s RST account was opened on March 1, 2008. Since then, eighteen RST returns have come due. Of those returns, none has been filed.

9. As a result, the Ministry has estimated the amounts owing for the time periods the returns were due (the “estimation process”). Generally described, the Ministry looks at what businesses of similar size and based in similar locations remit in RST and, by comparison, “estimates” what taxes a similar business would raise.

10. As of June 30, 2010, the Licensee owed an estimated balance totalling $20,965.64.

11. The Ministry has made efforts to collect the monies owing. It has attempted to contact the Licensee on a number of occasions. It has attempted to negotiate the remittance of returns and sales tax due. The Licensee did not respond to any efforts.

12. The Ministry then commenced legal action. The Sheriff (of the Region of Halton Wentworth), David J. McDonald, did a cash seizure at the establishment on May 7, 2010, and as a result, the Ministry received $3,000 on May 28, 2010.

13. The Licensee offered to pay $250 per month towards the RST arrears, and was advised that RST returns would need to be filed before the Ministry would enter into a Memorandum of Understanding.

14. An attempted bank garnishment on December 10, 2010 was returned “NSF.”

15. The Licensee’s lawyer, Mr. Burns, contacted a representative of the AGCO at one time, looking to extend the hearing date so the Licensee could be brought into compliance, but no one contacted the Ministry.

16. There has not been any contact by the Licensee with the Ministry since the AGCO’s NOP to revoke the licence was issued.

17. As of March 31, 2011, the RST owing is $21,673.96. The application of interest charges accounts for the difference between this and the earlier figure noted. The amount owing goes back to when the business was first registered with the Ministry, and not to when the Licensee became licensed.

18. The Licensee became a licensed establishment on June 9, 2008.

19. Mr. Kevin MacDonald, the principal of the corporate Licensee, has never contacted the Ministry to dispute the amounts owing.

20. In cross-examination, Mr. Kirkey explained that a separate branch of the Ministry – the Audit branch – has recently initiated an assessment of the Licensee’s account with the Ministry. The Licensee has now also been asked to gather together files and have them ready for the audit. Once the audit has been completed, reviewed and approved by an audit manager, the assessed amount becomes a collectible debt (the “audit process”).

21. The letter Mr. MacDonald received from Sandy Kovacs of the Ministry, dated March 24, 2011, (Exhibit 2) provides notice to the Licensee that the audit assessment process has been initiated. This letter reflects a balance of $47,151, plus applicable interest and a 25% penalty.

22. Mr. Kirkey explained that, while the amount of $21,673.96 is the correct balance owing as a result of the estimation process, the audit process allows the Licensee to provide accurate records so that the Ministry can conduct a proper audit and not rely on an estimated audit.

23. The amount reflected in Exhibit 2 is not a balance owing at this time. It is not a figure that has been generated after a finalized audit; however, it is notice of the auditor’s preliminary breakdown of RST owing in the absence of records being provided by the vendor.

24. The 25 per cent penalty is “on top of” the assessment. It is a one-time amount related to whatever amount is formally assessed. It is a penalty for non-compliance with the Act.

25. The annual rate of interest currently is five per cent, compounded daily. The rate fluctuates from year-to-year.

26. At the time of the hearing, the Sheriff had not been ordered to conduct a further levy.

27. A Notice of Objection can be filed by the vendor within 180 days of the Ministry’s actual or formal notice of RST owing. A formal Notice of Assessment will not be mailed until the date stated in Exhibit 2, that is, May 5, 2011. The stated balance owing will change when the formal letter is sent.

28. In re-examination, Mr. Kirkey confirmed that the Licensee has not filed or remitted any RST returns since March 2008.

29. In response to questions from the Board, Mr. Kirkey confirmed that the amount that is stated as owing, reflected in Exhibit 1 – the Ministry’s August 25, 2010 position document – takes the $3,000, Sheriff’s seizure, into account.

30. He also confirmed that the Licensee is still in default of the legal requirement to file and remit returns.

31. The NOP in this matter is based on the following concerns:

• The fact that no returns were remitted by the Licensee;

• The Licensee has not been in compliance with his legal responsibilities under the Act; and,

• The Licensee has not shown fiscal responsibility in relation to Ministry trust funds.

32. The licensed business ceased operation in mid-November, 2010.

Licensee’s Evidence

33. Kevin Earl MacDonald, is the sole shareholder of the licensed corporation and testified on its behalf.

34. He described his business as like a bar or tavern; it basically never had a kitchen. It was an alcohol establishment that sold beers and alcoholic beverages.

35. Mr. MacDonald has no prior experience as a licensed operator. He has a Grade 12 education, and previously, he had tried many things to have work.

36. He admitted that he has not filed any RST returns. He explained that he “got into a mess” and never had the money to get a bookkeeper or an accountant to keep track of his RST obligations for him.

37. Mr. MacDonald testified that he gave the $3,000 to the Sheriff voluntarily. He thought he could get on track to make payments towards the RST owing.

38. After the Sheriff’s seizure, he voluntarily made 3-4 payments, guesstimated at around $2,000 - $3,000, at the federal building on Bay Street, Hamilton. He does not have records and did not know where they might be located.

39. The auditor’s letter (Exhibit 2) was sent to 486 John Street North, Hamilton, which is his mother’s address and not where Mr. MacDonald currently resides; however, it is still his mailing address.

40. Mr. MacDonald acknowledged that in the past demands have been made for him to file RST returns. He has not done so because he did not know the exact number, or accurate amount, to state in the return. He believed that he would be committing fraud if he “just put in any number.”

41. Mr. MacDonald never discussed the 25 per cent penalty with anyone and has never agreed to pay one.

42. He does not know how the five per cent compensation, or bonus works, which is for making RST payments on time.

43. Mr. MacDonald indicated that he did not know the amount of the RST owing, as at the date of the hearing. He has asked for clarification from people he has spoken to on the phone, but he cannot seem to get an actual number.

44. Mr. MacDonald believes that he has not received credit for the payments he made which were over-and-above the $3,000 seized by the Sheriff.

45. He wanted the Board to be aware that he did not understand the RST amounts which the Ministry claims are owing.

46. In cross-examination, Mr. MacDonald detailed his job history, which included a number of different things such as working on the Ford assembly line and operating his own business that delivered products for Business Depot, amongst other things.

47. His main job has been looking after his unwell parents.

48. Mr. MacDonald thought that operating a bar would be ideal, but he learned that it is far from glamorous. Rather, it involves hard work and long hours.

49. Mr. MacDonald did not formally hire staff for the establishment. Instead, friends helped him out. His bartenders became Smart Serve trained after one of the AGCO inspectors told him that this training was mandatory.

50. The people who helped him out benefitted from some tips and at the end of the night. Mr. MacDonald might give them $20 or nothing. He did not record the payments he made to them.

51. Mr. MacDonald was the one who purchased alcohol for the bar. He bought it through the Liquor Control Board of Ontario (the “LCBO”), paying cash for it.

52. While he did not know exactly how much alcohol he bought from the LCBO between June 2008 – June 2010, but said that he wouldn’t doubt it when a figure of $470,000 was suggested to him.

53. Alcohol sales were recorded in the cash register, but it never worked properly. Some of these tapes, along with a lot of paperwork, are still in the filing cabinets at the establishment.

54. The business is being operated by a new owner who purchased the building and took over in November 2010. He was forced out though he always paid his rent. Mr. MacDonald did not think that a pub or bar is being operated there now.

55. Mr. MacDonald does not dispute that monies are owing for RST. It is not about him not wanting to pay it. The question is, what does he owe?

56. He did not send in RST returns because he was waiting for the time when someone else could do it for him.

57. Mr. MacDonald realizes now that the payments he made at the federal building in Hamilton went towards federal, and not provincial (retail sales) taxes owing. These were cash payments. The money was taken from the till. Mr. MacDonald believes that the receipt for these payments is still in the filing cabinet in the bar.

58. Mr. MacDonald represented that in November 2010 it was agreed the new owner, George, will pay the RST owing, once the exact amount of the debt is known, and then will take over the Licence. Mr. MacDonald did not know George’s last name and acknowledged that this arrangement is not in writing.

59. In questions from the Board, Mr. MacDonald acknowledged that 486 John Street North was the mailing address he gave the Ministry when he started the business and that he has never changed it.

60. Mr. MacDonald stepped away from the business in November 2010 because he thought that the licence was revoked. He received an order at that time, which was carried out.

61. He has not been back inside the establishment since November 2010, nor has he ever asked if he could come in and get his documents.

Registrar’s Submissions

62. The allegations in this matter related to the Licensee’s lack of financial responsibility, its failure to comply with the law and to act with honesty and integrity as it relates to the RST legislation.

63. Under the RSTA, vendors are obligated to file returns that set out, amongst other things, the total sales as well as the total taxes and what the taxes collected by vendor are.

64. Further, vendors are obligated under the legislation to make payment of the monies they collected as agents for the Ministry. This money is deemed to be trust money.

65. Mr. MacDonald admits that he has never filed an RST return. This demonstrates a lack of acting within the law. It also demonstrates a lack of honesty and integrity.

66. Sales were made to, and paid for by customers in the establishment. These people paid taxes in good faith and on the reasonable expectation that the money would be submitted to the Ministry, where it would then be used for the benefit of all people in Ontario.

67. The Licensee admits that RST is owing. Other than making some payments to a federal office, Mr. MacDonald did not take any steps with respect to his obligations.

68. The Registrar appreciates that there are a lot of responsibilities that come with running a business, but this does not excuse anyone from fulfilling all their obligations, and in particular, those under the RSTA.

69. The Licensee did not present any records (books, receipts, etc.) which would have been helpful at the hearing.

70. While the Licensee faces a possible 25 per cent penalty if he fails to co-operate with the Ministry audit, the matter before the Board at the hearing relates to its failure to file returns, the failure to remit the RST monies that had been collected in trust, and the estimated taxes owing of $21,673.96 (as at March 31, 2011).

71. Even if the amount owing is disputed, there is a complete failure to comply with the requirement of the Act, and not even to comply at a minimum, that is, to file the RST returns.

72. Also, there is no evidence that Mr. MacDonald, on behalf of the Licensee, had any contact with the Ministry, except for the Sheriff, to try and sort out the situation and despite the fact that there was correspondence sent to the address he had provided them.

73. This is an appropriate case for revocation of the licence.

74. The Registrar also relies upon the reasoning of the Licence Appeal Tribunal as set out in the Carrera Fine Cars decision.

Licensee’s Submissions

75. The Ministry’s “words” and the terminology it uses are confusing and it should bear some responsibility for the confusion which it caused Mr. MacDonald. He is admittedly a novice with respect to his involvement with a licensed premises, as well as RST and GST matters.

76. Mr. MacDonald’s confusion was not helped by Mr. Kirkey’s evidence.

77. There is inconsistency in the dates referred to in the various Ministry notices, tendered into evidence at the hearing.

78. Mr. MacDonald did not want to file ‘nil returns’ because he thought it was wrong. He has tried to address the arrears’ situation, but the amounts claimed to be owing are a constantly moving target. The range is anywhere from $21,000 to the $41,000-$65,000 range.

79. Mr. Kirkey concedes that the estimated RST taxes owing are guesses. Exhibit 5 supposedly supports the Ministry’s guesses.

80. The Licensee submits that there is some obligation on the Ministry to help the taxpayer and the tax collector and that’s not done by sending out various documents setting out differing amounts of monies owed.

81. Mr. MacDonald has candidly admitted his weaknesses and the Registrar has turned it around to suggest that it shows a lack of integrity.

82. The Ministry has a responsibility to give the vendor the right figure as to what is owing.

83. The Licensee wonders why he will have 180 days from an assessment that has not yet taken place if the licence is going to be revoked as the issue becomes irrelevant or redundant.

84. If the Licensee objects and is successful, it is doubtful that the Ministry will provide an apology.

85. The Licensee wants an accurate number; once he has the number, the new owner may be willing to pay it in order to get the Licence transferred to him. To repeat, the problem is that the Licensee cannot get the right number from the Ministry.

Registrar’s Reply

86. To categorize Mr. MacDonald as a novice to RST and GST matters is inappropriate. Whether one operates as a new business person or one with many years of experience, one still must meet one’s legal obligations.

87. Thousands of other vendors understand their obligations under the RSTA: if Mr. MacDonald is confused, he should take steps to clear up his confusion.

88. The Board is not to decide on audits that have not been finalized as yet. The matter to be decided relates to information set out in Exhibit 1, which was disclosed well in advance of the hearing.

89. The May 5th, 2011 date is irrelevant to the issues before the Board. This hearing is in relation to the October 2010 NOP, which is supported by Exhibit 1.

Reasons and Analysis

90. The issues for the Board to decide are: has the Licence holder failed to act with financial responsibility or with honesty and integrity.

91. To that end, the Board has carefully considered all the evidence and the submissions presented. It has concluded that the Licensee cannot reasonably be expected to be financially responsible in the conduct of its business, and therefore, FINDS that the Licensee has breached the provisions of subsection 6(2)(a) of the LLA.

92. Also, it has concluded that there are not reasonable grounds to believe that the Licensee has not acted with honesty or integrity, and therefore, dismisses the allegations that the Licensee acted dishonestly or without integrity and thereby breached the provisions of subsection 6(2)(d) of the Act.

93. Reasons for the Board’s two findings are set out below.

Can the Licensee reasonably be expected to be Financially Responsible in the Conduct of its business?

94. Relying upon Mr. Kirkey’s evidence, which the Board found to be credible, the Board finds that the basic requirements upon a vendor, such as the Licensee, under the RSTA are:

• To charge and collect RST from customers upon sales made to them (“the collected monies”);

• To hold the collected monies aside, or separate, from other money made by the business; and,

• On a regular, pre-determined basis, to send (that is, to “remit”) the collected monies, less five per cent to the Ministry, together a completed form (“the form”).

95. The collected monies do not belong to the vendor. Rather, they are held in trust by the vendor on behalf of Ontario taxpayers.

96. The form the vendor (or Licensee) is to submit is known as a “return” or “remittance.” It details the vendor’s total sales, the total RST actually collected on those sales, and what should have been collected during that time period.

97. By law, five per cent of the collected monies may be held back as a benefit or compensation to the vendor for the administrative work of collecting the RST and sending in the form.

98. The Board finds that these basic obligations upon a vendor under the RSTA are fairly simple and commonsensical. The Board also finds that they form an important and mandatory part of the many responsibilities that vendors, including Licensees, take on as an aspect of carrying on business. Importantly, the collected monies are impressed with a trust, making their remittance a requirement of the highest order.

99. Therefore, the Board also finds that Mr. MacDonald as a vendor, Licensee and businessman either knew, or if he did not know, then he ought to have known about these straight-forward and mandatory obligations under the RSTA.

100. In this case, the Licensee registered with the Ministry on March 1, 2008 and became a licence holder on June 9, 2008.

101. Furthermore, between March 1, 2008 and March 31, 2011, eighteen remittances should have been filed by the Licensee. None was. This fact is admitted.

102. As well, Mr. MacDonald admits that between March 1, 2008 and mid-November, 2010, when he stopped operating the establishment, RST was levied to and paid by his customers on their purchases.

103. On May 28, 2010, the Sheriff seized $3,000 from the Licensee on account and applied this amount towards RST owing by the Licensee. Otherwise, the Licensee has not remitted any collected monies to the Ministry. This fact is also admitted.

104. The above-described, admitted facts demonstrate that the Licensee has wholly failed to meet its obligations in relation to the collected monies and support the Board’s finding of a lack of financial responsibility on the Licensee’s part.

105. In view of the Licensee’s total dereliction of its duties in respect of the RST monies, the Licensee cannot reasonably be expected to be financially responsible in the conduct of its business, specifically, in relation to monies that, importantly, were collected in trust.

106. As such, the Licensee has breached the provisions of subsection 6(2)(a) of the LLA.

107. In mitigation, the Licensee argues that the amount of RST owing is not certain. This argument is specious, for several reasons.

108. First, it was impossible for the Ministry to calculate the exact amount of collected monies owing because Mr. MacDonald never submitted any of it, nor did he file any forms in that regard. In light of this complete dearth of information, the Ministry did the best it could to calculate, reasonably, what might be due and owing by the Licensee. It made, what is candidly admitted, a best guess estimate based on reasonable comparable business and the data related to those files.

109. How the Ministry determined its guesstimate of the amount outstanding is also clear and certain: Exhibit 1 breaks down the Licensee’s Statement of Account, from July 1, 2008 to June 30, 2010 as follows:

• Tax collected not remitted: $NIL

• Penalty: $1,930.00

• Interest: $1,935.64

• Estimated tax $17,100.00

• Total amount outstanding $20,965.64

110. Mr. Kirkey testified that ‘interest only” accounts for the difference between the $20,965.64 and the $21,673.96 owing as at March 31, 2011. He also clarified that the $3,000 seized by the Sheriff has been factored into these figures.

111. As a result, the Board finds that, for the purposes of these proceedings, the Licensee owed RST of $21,673.96 as of March 31, 2011. This figures includes penalties plus accrued interest to that date.

112. Given that, except for the $3,000 in seized monies, the Licensee has submitted nothing to the Ministry since March 1, 2008, and has not responded to Ministry requests (as per Exhibit 2), it is not surprising that the Licensee was recently put on notice that another retrieval procedure has been initiated in respect of the Licensee’s RST indebtedness: a Retail Sales Tax audit.

113. Specifically, by letter dated March 24, 2011 the Ministry put the Licensee on notice that an audit process was commencing. It is only by coincidence that the Licensee received this letter only a few days before the hearing. This completely separate process is not relevant to these proceedings. It should not be, and has not been taken into account by the Board.

Are there reasonable grounds to believe that, based on the Licensee’s past or present conduct, the Licensee will not carry on business in accordance with the law and with integrity and honesty?

114. An ‘honest’ person is truthful, sincere and frank and is free of deceit or fraud.

115. Persons with ‘integrity’ adhere to moral and ethical principles in their lives; they are honest people.

116. Assessing Mr. MacDonald’s past and present conduct, the Board determined that he is, in all likelihood and generally, an honest person with integrity.

117. It concluded that the most likely reason he did not remit the collected monies or RST owing, thereby showing considerable financial irresponsibility, was not through dishonesty or a failure of personal integrity. The Board believed that it was more probably because Mr. MacDonald got in “over his head” in acquiring the business and trying to operate it as a licensed establishment. The following evidence was relied upon in coming to this result.

118. Essentially, Mr. MacDonald never really got control of the business’s finances from the get-go: rather than acquiring and training qualified staff, he used friends to help serve and bartend; he did not get around to fixing his continually malfunctioning cash register; and, he never got a bookkeeper or an accountant to keep track of his revenue and expenses.

119. As a result of the pervasive state of operational mess at the establishment, Mr. MacDonald never got around to preparing and filing the requisite RST forms, let alone determining how much RST had been collected.

120. Candidly, he admitted that bar ownership turned out to be much harder than he had imagined, requiring long hours and hard work.

121. At the hearing, there was further evidence of Mr. MacDonald’s state of functional disarray rather than of his dishonesty or lack of integrity, as follows. Unfortunately, after his business came to its regrettable demise last November, Mr. MacDonald did not take copies of sales receipts, nor has he thought to ask for them from the business’s new owner, not even in preparation for and to help him with the hearing. Also, when he endeavoured, as promised, to make a few partial payments on account of RST owing following the Sheriff’s attendance, he made them to the wrong (i.e. a different) government office.

122. Furthermore, Mr. MacDonald’s various admissions at the hearing, including that he owes money to the Ministry, are additional proof that he is generally honest and a person of integrity.

123. Based on the foregoing evidence that was derived mainly from Mr. MacDonald’s own testimony, it seemed to the Board therefore that, overall, it was Mr. MacDonald’s lack of financial control over his business, and not dishonesty or a lack of integrity, that led him not to make the required remittances. As such, the Board dismisses the allegation that he breached subsection 6(2)(d) of the LLA.

124. Before leaving this point, the Board wishes to address a couple of excuses put forward in Mr. MacDonald’s defence.

125. One point was that Mr. MacDonald lacked business savvy: he claimed that he was a novice businessman and also that he did not understand the Ministry’s various correspondences with him on the issue of the RST owing. These are not mitigating factors, however.

126. All licensees, including this one, have a responsibility to educate themselves on all aspects of running their business, to comply with their various obligations and responsibilities such as collecting RST and making the required remittances, and to seek appropriate assistance or help as needed to ensure such compliance.

127. Mr. MacDonald also wants the Board to believe that he did not file any RST returns because he thought he would be committing fraud if he guessed at, rather than provided an accurate figure in those form(s). The Board was not presented with any evidence to allow it to determine whether this would have constituted a criminal act. Nonetheless, it concludes that this attempted justification is also without merit.

128. First of all, Mr. MacDonald should have made inquiries of the Ministry as to what he could or should have done in his circumstances (that is, not knowing exact remittance amounts). As well, generally speaking it can be concluded that he should have filed returns. For, as Mr. Kirkey testified, even if a vendor does not have the funds to remit, it is better for them to file returns. At least then, they are in satisfaction of the requirement to file, even if they are not complying with the requirement to remit. By choosing to do nothing, Mr. MacDonald ended up completely ignoring or neglecting his fiscal responsibilities.

129. What’s more, the Licensee’s argument that Mr. MacDonald could not figure out how much RST is owing is incongruous. After all, the Licensee, acting as a vendor, made the sales and collected the RST over its years of operation. Thus, it was the Licensee – and not the Ministry – that possessed or controlled the necessary information first and foremost, and as such, was in the best position to make that calculation.

Submissions as to Sanction

130. Finally, the Board addresses the issue of submissions as to sanction. In her submissions, Ms Harari briefly suggested that the Licence be revoked; she did not elaborate upon the reasons why the Board should revoke the Licence. The Licensee’s counsel did not deal with the issue in his submissions.

131. When a disciplinary matter comes before the Board, except as limited or restricted by legislation, the Board is given the discretion to decide upon the sanction to be imposed.

132. Support for this contention is found in the Nashville North decision, which was an appeal of a decision by the Board of the AGCO. In that case, the Divisional Court referred favourably to the Court of Appeal’s decision in Stetler, which said:

“The issue of the appropriate penalty for infractions within a profession or industry is one that is uniquely within the experience, expertise and discretion of the relevant disciplinary tribunal and is therefore subject to a high degree of deference.” (emphasis added)

133. In this case, the Board has made a finding against the Licensee under subsection 6(2)(a) of the LLA, and as a result, exercises its discretion to require submissions as to the appropriate sanction in this matter.

Conclusion

134. Therefore, for the reasons given, the Board FINDS that the Licensee violated subsection 6(2)(a) of the LLA. It DISMISSES the allegation that the Licensee violated subsection 6(2)(d) of the Act.

135. The Board invites written submissions on penalty from the respective parties. The Registrar’s representative shall serve and file his written submissions within seven (7) days of the date of this decision. The Licensee’s representative shall have seven (7) days to serve and file his written response. Registrar’s Representative may serve and file any reply within three (3) days of receipt of the Licensee’s response. All submissions are to be filed with the Manager, Hearings Department, Alcohol and Gaming Commission at the address on the front page of this decision in accordance with the Board’s Rules of Practice.

DATED AT TORONTO THIS 14th DAY OF June , 2011

PATRICIA MCQUAID, VICE-CHAIR GRACE KERR, BOARD MEMBER