Registrar, Alcohol and Gaming Commission of Ontario v. 1588389 Ontario Inc., 2011 CanLII 64078

IN THE MATTER OF The: ALCOHOL AND GAMING REGULATION AND PUBLIC PROTECTION ACT S.O. 1996, C.26, S.14.1, SCH

Registrar, Alcohol and Gaming Commission of Ontario Registrar

-and-

1588389 Ontario Inc. operating as Empire Restaurant & Lounge Licensee

DECISION

Panel: Eleanor Meslin, Chair, AGCO Patricia McQuaid, Former Vice-Chair

Decision Date: August 17, 2011

Hearing Location: Toronto, 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 ) Tamara Brooks, Representative 1588389 Ontario Inc., Licensee ) Jerry Levitan, Representative

Allegations

A hearing into the appeal of Order of Monetary Penalty (“OMP”) number 265 dated October 15, 2010, issued to 1588389 Ontario Inc. (the “Licensee”), operating as EMPIRE RESTAURANT & LOUNGE (the “establishment” or the “premises”), 50 Cumberland Street, Toronto, Ontario, M4W 1J5, liquor licence number 25678 (the “Licence”), pursuant to section 14.1 of the Alcohol and Gaming Regulation and Public Protection Act, 1996, in respect of an alleged violation of section 43 of Ontario Regulation 719/90 (the “O.Reg”) made pursuant to the Liquor Licence Act (the “LLA”), was held on June 22, 2011 in the City of Toronto.

Decision

After considering all the evidence and submissions, the Board DISMISSES the alleged violations contained in the OMP and SETS ASIDE the monetary penalty sought by the Registrar. Reasons follow.

Preliminary Matters

The Board ordered that witnesses be excluded, on consent of the parties.

Registrar’s Evidence

Two AGCO inspectors, Devin Sookdeo and Clay Foley, attended at the licensed premises on April 25, 2010 at approximately 2:28 a.m. Upon arrival, they identified themselves to security personnel at the front door. Inspector Foley who is familiar with the establishment, spoke to security about the licensed capacity. The premises were busy.
Inspector Sookdeo then conducted a count, using a mechanical counter, of the main floor. He did his count walking from the front of the main floor area to the rear, sectioning off the area into four areas for the purposes of his count, making reference to Exhibit 1A – the floor plan of the main floor area. Inspector Sookdeo described having to push through the dance floor area while doing his count. Some of the patrons were standing shoulder to shoulder. Lighting was dim.
The area is licensed for 144 persons. His count was 186. He estimated it took 8-10 minutes to complete his count. Inspector Sookdeo stated that he counts stationary bodies, not traffic flow…patrons were dancing. From the main floor area, he then proceeded to the basement, where there is another licensed area as well as washrooms. Between five and eight patrons were in the washroom area. The licensed area was not in use and appeared to be closed.
Inspector Sookdeo then went back upstairs where he and Inspector Foley spoke to the manager, Dan Sadavoy, advising him of the infraction found and that a report would be filed with the Deputy Registrar. Mr. Sadavay stated that he was trying his best to get the numbers within capacity. They left the premises at 2:58 a.m.
On cross-examination, Inspector Sookdeo stated that he did not have a complete visual of everyone on the main floor. As he was walking from the front to rear, he could not see those behind him to know whether they were leaving the premises. Last call was at 2 a.m. No signs of after hours service were observed.
Inspector Foley conducted a count on the patio while Inspector Sookdeo did his count inside. Therewere 35-40 people on the patio, which has a licensed capacity of 55. Numbers can fluctuate on a count and in this instance he did two counts on the patio.
After he received Inspector Sookdeo’s count, he spoke to Mr Sadovay and to Taib Jaulim, the head of security. One of Mr. Jaulim’s responsibilities is to monitor capacity. Mr. Jaulim told him initially that the count was 318 though there seemed to be some confusion as to whether that included the patio. He was then told by Mr. Jaulim that approximately 50 people had left since 2 a.m., further reducing the number inside.
Inspector Foley had told Mr. Sadavoy in the past that they were not entitled to combine the capacities (for example of the main floor and patio for 199 in the main floor area). Capacities must be separately calculated.
In their discussion, Mr Sadavoy stated that he (Foley) had always been fair with him. He accepted their count, not questioning their numbers. Mr. Sadavoy has made efforts to ensure compliance and they have in past discussed how difficult it is to maintain control over their numbers. The premises were busy that evening and appeared over capacity with people standing shoulder to shoulder in some areas. The music was playing when they arrived.
Inspector Foley stated that he has inspected this establishment on numerous occasions. It is on the AGCO “risk based enforcement” list which means that additional inspections are conducted.
On cross-examination, Inspector Foley stated that they did not count the numbers of patrons leaving the premises. The count itself is a snapshot in time, capturing what is happening in the premises at the moment. While he agrees that there is always a margin of error and counts are an approximate, he had no doubt that the premises were over capacity when they were present. He did not recall what was happening at the premises when they left at 2:58 a.m.

Licensee’s Evidence

Daniel Sadavoy has been the general manager of the Empire Restaurant & Lounge for almost five years. Although he prepared a statement for the purposes of the hearing (Exhibit 2), he stated that he had an independent recollection of events. In addition, he had, in the normal course, completed a log entry for that evening (Exhibit 3), at around 5 - 6 a.m.
Mr. Sadavoy explained that eight security guards are employed with Mr. Jaulim being the head of security. They are equipped with two way radios. Mr Jaulim uses two counters, for “in” and “out” counts. He and Mr. Jaulim communicate throughout the night about capacities. The lower level is used as an overflow area once the upstairs approaches capacity.
On the night in question, last call was at 2 a.m. Between 2:20 a.m. and 2:40 a.m. lights are slowly turned on and the last patron is out of the establishment by 3 a.m. He saw the inspectors arrive. Inspector Sookdeo did not do a physical walk through the crowd. He spent approximately ten minutes on the main floor, observing what was going on and then went downstairs. He was not aware that the inspector was doing a count until later.
The total capacity for the establishment is 355, though there are three areas, each with a separate capacity. These are each monitored. On April 25th, the total number for the evening were 318. Once the main floor capacity hits within range of capacity, at approximately 140 persons, the downstairs area is opened. It was in use on April 25th. However, when the inspectors showed up, the crowd was thinning out. When clearing the establishment, the downstairs is closed first. The lights are turned on and the music, off. The downstairs was vacated by the time the inspectors arrived.
Mr. Sadavoy stated that he did not admit to overcrowding that night.
On cross-examination, Mr. Sadavoy stated that he made an assumption that charges would likely follow the inspectors’ attendance, but they did not communicate on April 25th that the matter would, in fact, go to the Deputy Registrar for review. His log notes (Exhibit 3) were made as per his usual daily procedure, not because of the inspectors’ visit. Further, he stated that the log is not made for the owner, Mr. Laxton’s, review. The notes would have been prepared between 5 – 6 a.m. that morning. The last patron left at about 3 a.m. after which he would reconcile cash, pay security and attend to recycling and garbage. After these closure activities, he would complete the log.
By way of clarification of his log notes, a “late crowd” refers to the fact that the crowd arrived between 12-12:30 a.m. There were no “incidents” to report that evening. On the log, he states that his count, and that of Mr. Jaulim, was not over capacity. He disputed the number given by inspectors, but did not argue with them as it was not the appropriate time to do so. He did indicate that Inspector Foley had been fair with them in the past, but in saying this, he was not attesting to the accuracy of the number. There are no numbers cited in the log, but in Exhibit 2, written by him in November 15, 2010, he cites 184 “net arrivals” by which he meant 184 people came into the premises between approximately 12:30 - 2 a.m. He has a specific recollection of receiving the count of 140 from Mr. Jaulim, because of their clear rules about capacities and opening up the downstairs.
Exhibit 3 also makes reference to “constant visits from AGCO.” Mr. Sadavoy stated that he was not aware, at that time, that the reason for this visit was that the establishment is on the AGCO risk-based enforcement list.
Taub Jaulim has been head of security personnel at the Empire for almost five years. He had no strong recollection of the night of April 25th, but did recall that he was asked by counsel, Mr. Levitan, to prepare a statement, which is Exhibit 4. Mr. Sadavoy did not tell him what to write.
Mr. Jaulim works with two counters, for in and out counts. He did recall the visit by the inspectors and being asked by Mr. Foley what his count was, to which he responded, “318 – minus the people who had left.” They need to balance capacities, and when they reach 140 on the main level, the crowd is moved downstairs.
On cross-examination, he stated that he was definite that the premises was not over capacity. At 2:20 p.m. many patrons were leaving. There are two subway stops close by and the subways close at 2:30 a.m. which means a large number of patrons leave between 2:15 – 2:30 a.m.

Analysis/Reasons/Findings

The Board finds evidence of Inspector Sookdeo to be credible to the extent that he did a count of 186 persons in the main floor. Further, the Board notes the inspectors’ evidence that the count was under capacity on the patio and that the lower level was closed – consistent with Mr. Sadavoy and Mr. Jaulim’s evidence that at 2:30 a.m. or so, it would be closed as part of their usual procedures at that hour.
The issue for the Board is, in the context of all the evidence, what the number, in fact, reflects. The inspectors described the premises as very busy, with patrons standing shoulder to shoulder. Yet, Inspector Sookdeo in describing the process by which he completes his count, which might have taken 8 - 10 minutes, stated he did not count a flow of patrons, or those that were leaving. Inspector Foley did not himself do a count of the main level. He stated that the numbers looked to be close to capacity, therefore a count was necessary. Counts in his experience are always an approximate with a margin for error, but he had no doubt it was over capacity. Unfortunately, a second count was not done to further verify that fact.
Mr. Levitan points out that Inspector Sookdeo candidly stated that he did not count patrons who were leaving behind him. What troubles the Board is how the inspector knew, if the premises were as busy as described, which patrons were leaving. A readily identifiable flow of patron traffic may not have been evident.
Context becomes important in evaluating the evidence because it was, in fact, closing time. Downstairs was closed. Service of alcohol had ceased. No signs of sale and service were observed past 2:45 a.m. No other violations were noted. The inspectors were at the premises from approximately 2:30 a.m. – 3 a.m. It is less probable that no departing patrons were counted given the hour, that is, at a time when people were more likely to be leaving than staying on.
The Board does agree with Ms Brooks’ submission that Exhibits 2 and 4 are practically identical in language which lends them less credibility as independent recollections of the witnesses, especially the reference to the number “184” which appears in both. However, the fact that Mr. Sadavoy’s log (Exhibit 3) makes no reference to a count, does not strike the Board as self-serving. Rather, it presents, in the information noted, which goes beyond the issue of the inspectors’ attendance, as a log prepared in the usual course of business. Arguably, it may have been more self-serving if a low number had been cited. It cannot be inferred from Mr. Sadavoy’s response to the inspectors or by his log notes that he was admitting to the numbers being over capacity. As was evident from the evidence of Inspector Foley and both Mr. Sadavoy and Mr. Jaulim, this is a Licensee who was aware of over-capacity issues. In and out counts were monitored, an overflow mechanism was in place. That awareness may well have come from prior visits by inspectors as a result of the AGCO’s risk-based enforcement policy. The result of those prior attendances were not (nor should they be) before the Board.
The Board must be able to conclude, on the balance of probabilities, that the Licensee failed to ensure the number of patrons did not exceed capacity. The onus is on the Registrar. Given the facts before the Board, it cannot conclude that the Registrar has met that onus. The Board therefore DISMISSES the allegation of a violation of section 43 of the O.Reg.

Conclusion

For the reasons given, the Board DISMISSES the alleged violation contained in OMP number 265, issued to 1588389 Ontario Inc., operating as EMPIRE RESTAURANT & LOUNGE, 50 Cumberland Street, Toronto, Ontario, M4W 1J5, liquor licence number 25678, and SETS ASIDE the monetary penalties sought by the Registrar in the amount of $5,000.

DATED AT TORONTO THIS 17th DAY OF August , 2011

ELEANOR MESLIN, CHAIR, AGCO PATRICIA MCQUAID, FORMER VICE-CHAIR