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-
2141575 Ontario Limited o/a XS Licensee
DECISION ON SANCTION
Panel: Brian J. Ford, Board Member S. Grace Kerr, Board Member
Decision Date: October 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 ) Richard Kulis, Representative 2141575 Ontario Limited o/a XS, Licensee ) J. Randall Barrs, Representative
Allegations
1. A hearing into Notice of Proposal number 18580 (“the NOP”), dated March 11, 2011, to suspend for 45 days a liquor licence, and an Order dated March 11, 2011, to immediately suspend a liquor licence on an interim basis to liquor licence number 810853 (the “Licence”), issued to 2141575 Ontario Limited (the “Licensee”), operating as XS, 261 Richmond Street West, Toronto, Ontario, M5V 3M6, on the basis of alleged violations of subsection 45(1) of Ontario Regulation 719/90 (“the O. Reg”) made under the Liquor Licence Act (the “LLA”) and breaches of a condition on the Licence which states “the holder of the licence shall comply with the Compliance Plan approved by the Registrar of Alcohol and Gaming” was held on March 23, 2011 in the City of Toronto.
2. On March 11, 2011, the Registrar ordered the interim suspension of the Licensee’s licence in the interest of public safety and subject to an Order by the Board of the Alcohol and Gaming Commission of Ontario (the “Interim Suspension Order”).
3. At the hearing on March 23, 2011, the Board orally ordered that the Interim Suspension Order be lifted, with conditions. The Board’s oral order was confirmed by the written order dated September 7, 2011.
4. In other words, the Licensee served a 12-day suspension on an interim basis (the “12-day interim suspension”).
5. Additionally, the Board heard evidence at the hearing relating to the allegations in the NOP, and found that the Licensee breached a condition on the Licence, which states “the holder of the licence shall comply with the Compliance Plan approved by the Registrar of Alcohol and Gaming”.
6. Specifically, the Board found that, contrary to the Compliance Plan, the Licensee failed to:
- post signage to let people attending the establishment know about the video surveillance of the premises;
- ensure that all (video- or surveillance) cameras were maintained in good working order at all times; and,
- ensure that all persons entering or re-entering the premises were checked by a metal detector.
7. The Board dismissed the allegation that the Licensee failed to follow the requirements of the Compliance Plan in the event of an altercation. It also dismissed the allegation that, contrary to subsection 45(1) of the O. Reg, the Licensee 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.
8. Parties were directed to provide written submissions on an appropriate sanction. The Board received and reviewed those submissions.
Registrar’s Submissions
9. The Registrar submitted that a 30-day suspension, in addition to the 12-day interim suspension already served, is appropriate, given the Board’s findings. The conditions on the Licence, intended to protect the public’s safety, are necessary for businesses such as the Licensee’s that operate in the Entertainment District, which is infamous for violent activity.
10. The Licensee and its staff showed cavalier disregard for the conditions.
11. The Licensee’s alleged loss of $250,000 in gross revenue during the 12-day interim suspension is unsubstantiated.
12. Having the Licence suspended for an additional period of time will serve as a specific deterrent to the Licensee as well as an incentive to its staff to responsibly execute their duties in relation to the conditions.
Licensee’s Submissions
13. The Licensee asks that it not be required to serve a further suspension.
14. It points out that the Board dismissed the two most serious allegations against it.
15. The Board’s findings do not suggest the Licensee flagrantly breached the condition on the Licence, according to the Licensee. Rather, the signage issue was simply an oversight; the failure to turn on the video surveillance cameras on the night in question was due to human error. Also, the Licensee’s failure to check the bands and their equipment long before opening was also a result of human error, and the problem that resulted was unforeseeable.
16. The Licensee’s financial loss, resulting from the interim suspension, was supported by evidence at the hearing that was uncontroverted and may be even higher than initially thought. The Licensee continued to experience the financial effects for several months following the earlier suspension in terms of reduced attendance on key opening nights and lost special event bookings.
17. The Licensee’s management and staff continue to assist the police in the prosecution of the crime in relation to which it was the victim.
Registrar’s Reply Submissions
18. There were no reply submissions.
Reasons and Analysis
19. The Board has carefully considered the submissions of the Registrar and the Licensee on sanction and has decided that no additional suspension is warranted in this case. The Board finds that the 12-day suspension, already served by the Licensee on an interim basis, is sufficient to fulfill the primary sanctioning principles of specific and general deterrence.
20. Licensees, by virtue of their participation in a regulated industry, which allows them to serve alcohol and do so for profit, must comply with their statutory obligations.
21. One obligation is to comply with conditions placed upon a license, such as those at issue in this case. Such conditions are intended both to minimize risk to public safety and to promote compliance by licensees with their statutory obligations.
22. In this matter, the Board found that the Licensee failed to comply with 3 aspects or sub-conditions of a Compliance Plan, which was attached to the Licence as a condition.
23. Specifically, the Licensee failed to post signage to let people attending the establishment know about the video surveillance of the premises, to ensure that all (video- or surveillance) cameras were maintained in good working order at all times, and to ensure that all persons entering or re-entering the premises were checked by a metal detector.
24. In relation to the first sub-condition breached, the Licensee testified that it took action to rectify the situation immediately. The Board believes that signage, letting patrons know that they are being videotaped, is now in place.
25. In other words, the Licensee rectified this breach, immediately and completely.
26. Regarding the second violation, the Licensee testified that it was a “one-off” situation. As a rule, the video-surveillance system is checked daily to ensure that it is operating; due to human error, it was not checked on the night in question to ensure that it was operational.
27. Again, the Board accepts the Licensee’s evidence that it has taken steps to ensure that this situation does not happen, and that it has not happened, again.
28. Of the 3 sub-conditions breached, it was the Licensee’s contravention of the latter one that was the most serious and gave rise to the greatest safety risk to the public, patrons and staff members alike.
29. Nevertheless, the Board believes that there are mitigating circumstances to favour the Licensee in terms of sanctioning.
30. First, it agrees with the Licensee that the serious situation was unforeseeable: it came about in the unique circumstances of the day/night in question, which was the establishment’s participation in a music week festival.
31. That night the Licensee had complied with the spirit of the sub-condition: all patrons who entered the establishment from opening time on were subjected to its metal detection system.
32. It was the Licensee’s failure to check everyone who came into the establishment at all times, and not just during opening hours, that allowed the gun to be brought into the establishment and provided the opportunity for the patron’s criminal behaviour to take place (i.e. the firing of the gun into the air as the patron was being escorted out of the establishment following an altercation with other patrons).
33. This serious risk, however, became known only with the perfect vision of hindsight.
34. The Licensee has indicated that ever since the incident that gave rise to these proceedings everyone entering the establishment, whenever that might be, is checked by metal detectors.
35. Also in mitigation, there was no evidence that the Licensee has breached any of these sub-conditions in the past.
36. As well, the Board has taken the Licensee’s acknowledgement of responsibility into account in coming to its decision on sanction in this matter.
37. In this case the Licensee acknowledged breaches of the 3 sub-conditions and specified what it has been doing differently since the night in question to minimize the likelihood of contraventions reoccurring.
38. Acknowledgement of responsibility is to be encouraged, though its authenticity should also be judged. Evidence of genuine accountability may act to mitigate the length of a suspension.
39. Specifically, the Board needs to discern that there has been real learning so that the offences will not be repeated.
40. The corrective, or remedial, measures that the Licensee has implemented allay the Board’s concerns about the breaches of the sub-conditions.
41. The Board concludes that the Licensee’s initiatives are authentic, and as a result, should act as preventatives to future violations.
42. Finally, the Board concludes that a further, or additional 30-day suspension, as proposed by the Registrar, would be too harsh in the unique circumstances of this case. In coming to that conclusion, the Board took into account the following factors:
a. it did not find against the Licensee as regards the serious allegations that it breached subsection 45(1) and that it failed to follow the requirements of the Compliance Plan in the event of an altercation;
b. the 12-day interim suspension addressed the immediate public safety concern that resulted from the Licensee’s failure to metal detect the musicians and their helpers who entered the establishment before its opening hours, which likely was responsible for how the gun was brought into the establishment;
c. any on-going public safety issues should effectively be mitigated by the Licensee’s professed conformity with all aspects of the Compliance Plan; and,
d. the Board believes the Licensee’s explanations for why the sub-conditions on the License were breached.
Summary
43. In the context of this case and given the nature of the contraventions as well as the surrounding circumstances, offset by the Licensee’s lack of a prior disciplinary record and the presence of corrective action, the Board finds that the twelve (12) day interim suspension already served is appropriate, from the standpoint of specific and general deterrence.
44. Furthermore, based on the foregoing reasons the Board also finds that the 12-day interim suspension already served should act to protect the public, maintain the industry’s and the regulator’s reputations, and facilitate the Licensee’s rehabilitation.
Conclusion
45. Therefore, other than the 12-day interim suspension already served, the Board finds that the Licensee shall not be required to serve any further suspension in relation to Notice of Proposal number 18580, dated March 11, 2011.
DATED AT TORONTO THIS 17th DAY OF OCTOBER, 2011
________________________________ ________________________________
BRIAN J. FORD, BOARD MEMBER S. GRACE KERR, BOARD MEMBER