Nacewicz v Ontario Flue-Cured Tobacco Growers’ Marketing Board, 2003 ONAFRAAT 6

Agriculture, Food and Rural Affairs Appeal Tribunal 1 Stone Road West

Tribunal d’appel de l’agriculture, de l’alimentation et des affaires rurales 1 Stone Road West

Guelph, (Ontario) N1G 4Y2 Tel: (519) 826-3433, Fax: (519) 826-4232 Email: AFRAAT@ontario.ca

Guelph (Ontario) N1G 4Y2 Tél.: (519) 826-3433, Téléc.: (519) 826-4232 Email: AFRAAT@ontario.ca

Nacewicz v Ontario Flue-Cured Tobacco Growers’ Marketing Board

Nacewicz v OFCTGMB [Pre-Hearing Conference] 2003 ONAFRAAT 6

Ministry of Agriculture, Food and Rural Affairs Act

February 28, 2003

DATE OF DECISION:

March 20, 2003

2003-06

2003 ONAFRAAT 6

Nacewicz v Ontario Flue-Cured Tobacco Growers’ Marketing Board [Pre-Hearing Conference]

IN THE MATTER OF THE FARM PRODUCTS MARKETING ACT AND SECTION 16 AND SECTION 16(4) OF THE MINISTRY OF AGRICULTURE, FOOD AND RURAL AFFAIRS ACT.

A motion by the Ontario Flue-Cured Tobacco Growers' Marketing Board requesting that the Tribunal refuse to hear an appeal by Alexander Nacewicz, Rodney, Ontario from a decision of the Ontario Flue-Cured Tobacco Growers' Marketing Board by which it refused to grant his request that the 2002 marketing quota be attached to Basic Production Quota he wished to sell.

An Appeal to the Agriculture, Food and Rural Affairs Appeal Tribunal by Alexander Nacewicz, Rodney, Ontario from a decision of the Ontario Flue-Cured Tobacco Growers' Marketing Board by which it refused to grant his request that the 2002 marketing quota be attached to Basic Production Quota he wished to sell.

Before:

Jack Young, Vice Chair; Mary Field, Member; Tom Hall, Member

Appearances:

Alexander Nacewicz, appellant

Barry Bresner, counsel to the OFCTGMB, the respondent

Frank Menich, Director, OFCTGMB, witness

Michelle Douglas-Cummings, counsel to the Tribunal

DECISION OF THE TRIBUNAL

This matter was heard in Guelph, Ontario on Friday, February 28, 2003.

The purpose of this proceeding was to consider a motion by the Ontario Flue-Cured Tobacco Growers' Marketing Board (OFCTGMB) that the Tribunal refuse to hear an appeal by Mr. Alexander Nacewicz from an OFCTGMB decision regarding his request that it transfer Basic Production Quota, with 2002 marketing quota attached, to another tobacco grower.

Factual and Statutory Context

On November 15, 2002, the Tribunal heard an appeal with respect to Mr. Nacewicz's 2002 marketing quota and in a decision dated November 25, 2002, upheld a decision of the OFCTGMB to:

(a) reduce Mr. Nacewicz's 2002 marketing quota to the amount of tobacco carried over from 2001; and

(b) refuse to allow him to rent out all of his 2002 marketing quota as a fall rental.

At the request of the appellant, the Minister reviewed the Tribunal’s decision and declined to intervene.

On February 10, 2003, Mr. Nacewicz brought this appeal to the Tribunal under subsection 16(2) of the Ministry of Agriculture, Food and Rural Affairs Act (hereinafter referred to as the Act). In this appeal, Mr Nacewicz alleged that the OFCTGMB has made a decision to refuse his request to permanently transfer his Basic Production Quota, with all of the 2002 marketing quota attached (including the portion reduced as a result of the prior appeal).

The OFCTGMB asked the Tribunal not to hear this appeal on the grounds that the conditions for appeal in subsection 16(5) of the Act had not been met because Mr. Nacewicz never completed his quota transfer application to the OFCTGMB. In the alternative, the OFCTGMB asked the Tribunal to exercise its discretion under subsection 16(4) of the Act to refuse to hear the appeal on the grounds that the appeal was frivolous and vexatious because:

The issues that were the subject of this appeal were already the subject of a binding decision by the Tribunal as a result of the previous appeal.
Due to the passage of time, no effective remedy could be granted by the Tribunal.

The relevant subsections of the Act are as follows:

Idem

16.(2) Subject to subsections (4) and (5), if a person is aggrieved by an order, direction, policy, decision or regulation made under the Farm Products Marketing Act by a local board or under the Milk Act by a marketing board, that person may appeal to the Tribunal by filing with the Tribunal and sending to the local board or marketing board written notice of the appeal.

Tribunal may refuse to hear appeal

16.(4) The Tribunal may refuse to hear the appeal or, after a hearing has commenced, refuse to continue the hearing or make a decision if it relates to any order, direction, policy, decision or regulation of which the appellant has had knowledge for more than one year before the notice is filed under subsection (1) or (2) or, if in its opinion,

(a) the subject-matter of the appeal is trivial;

(b) the appeal is frivolous or vexatious or is not made in good faith; or

Conditions for appeal

16.(5) No appeal may be taken from an order, direction, policy, decision or regulation of a local board or a marketing board unless,

(a) the appellant has first applied to the local board or marketing board for a hearing and the local board or marketing board has refused to grant, in whole or in part, the relief requested by the appellant or has not decided the matter within sixty days of the application for a hearing; or

(b) the appellant and the local board or marketing board have waived their respective rights under clause (a) in writing.

The Issues

The issues before the Tribunal in considering the OFCTGMB's request that the Tribunal not hear the appeal, were as follows:

Have the conditions for bringing an appeal under subsection 16(5) of the Act been met? Did Mr. Nacewicz make an application to transfer his Basic Production Quota, with all of the 2002 marketing quota attached. If so, did this constitute an "application for a hearing" within the meaning of subsection 16(5) of the Act? If it did, did the OFCTGMB refuse to grant the relief requested, in whole or in part or waive its rights under subsection (5); or has 60 days passed since the application for a hearing was made?
Should the Tribunal refuse to hear the appeal by Mr. Nacewicz because it is frivolous or vexatious within the meaning of subsection 16(4) of the Act?

The Evidence and Submissions

OFCTGMB’s Position

Mr. Barry Bresner told the Tribunal that the OFCTGMB issued Basic Production Quota (BPQ) to tobacco growers and that the total amount of BPQ did not vary from year to year. He said the OFCTGMB also issued marketing quota, as a percentage of BPQ. He explained that the amount of marketing quota issued varied from year-to-year with crop size. Mr. Bresner said that all quota was the property of the OFCTGMB but that it allowed growers to transfer BPQ issued to them to other growers, with the OFCTGMB's consent.

Mr. Bresner submitted that the appeal was not properly before the Tribunal under subsection 16(5) of the Act because Mr. Nacewicz had not properly applied to the OFCTGMB to have his quota transferred to another grower. He said Mr. Nacewicz did not provide the documentation required by the OFCTGMB to process the application. He explained that OFCTGMB regulations and policy required that applications for quota transfers be accompanied by:

a completed declaration in Form 22 made by transferor;
a completed declaration in Form 24 made by transferee;
a completed declaration in Form 25, Certificate of Solicitor of Transferor or Transferee;
a completed declaration in Form 30, Consent of Encumbrancer; and
a duplicate original or a certified copy of the transfer instrument, where applicable, or other evidence of transfer, where required by the OFCTGMB.

Mr. Bresner said that the OFCTGMB had repeatedly asked Mr. Nacewicz to provide the proper documents after receiving a request to transfer BPQ, but that Mr. Nacewicz had not filed the documents with the OFCTGMB. He said the OFCTGMB dealt with requests for quota transfers each month, and that requests for transfers were due on the fifth business day of the month in which the transfer request is to be considered.

Mr. Frank Menich, a director of the OFCTGMB, told the Tribunal the OFCTGMB had used the same process for transferring BPQ since the late 1980's. He said the OFCTGMB required the proper documents to be filled out so that notice could be given of the proposed transfer. He said the OFCTGMB was not in the business of making sure BPQ is free and clear and that giving notice of the proposed transfers allowed encumbrancers to look after their own interests.

Mr. Bresner also submitted that the appeal by Mr. Nacewicz was frivolous or vexatious within the meaning of subsection 16(4) of the Act. Mr. Bresner indicated that the appellant's current appeal involves the same marketing quota that was the subject of the previous appeal before the Tribunal and that this marketing quota had been substantially reduced and most of it taken away from Mr. Naciewicz as a result of the Tribunal's decision in that previous appeal. This decision was now final, and the Tribunal could not re-decide the issue of the quota reduction.

Mr. Bresner further submitted that even if the Tribunal decided to hear the present appeal and the appeal was successful, there was no remedy available that would benefit Mr. Nacewicz. Mr. Bresner submitted that December 6, 2002 was the last day that an application to transfer BPQ with 2002 marketing quota could be made. He said that even if the Tribunal was to make an exception for Mr. Nacewicz, the transfer could not be completed before the Tobacco Exchange closed for the season in mid-March 2003. He therefore said the 2002 marketing quota was worthless and a decision in Mr. Nacewicz’s favour would have no effect.

Alexander Nacewicz’s Position

Mr. Nacewicz told the Tribunal that he had a potential purchaser for his BPQ on December 4, 2002 and had met with a lawyer and realtor in the lawyer's office that day. He explained that the lawyer was preparing the transfer documents required by the OFCTGMB, but that the work was not completed because OFCTGMB staff told the lawyer's secretary that the 2002 marketing quota was not attached to his BPQ. He said he and the realtor then went to the OFCTGMB office and that he was told by a member of the OFCTGMB staff that he needed an exemption from a May 31, 2002 deadline, to allow him to sell his BPQ with 2002 marketing quota attached. He said the OFCTGMB staff refused to accept the request for the proposed transfer of his BPQ on December 4, 2002.

Mr. Nacewicz said he was aware that an application to transfer his BPQ had to be made by December 6, 2002, so he requested an exemption from the May 31, 2002 deadline from the OFCTGMB by facsimile transmission on December 6, 2002. He said he included the transfer document prepared by the lawyer, with the buyer's name blocked out. He said he also provided the OFCTGMB with a $100 cheque that was required as a result of missing the May 31, 2002 deadline.

Mr. Nacewicz said the OFCTGMB refused to hear his request for a quota transfer and he was required by the Act to wait 60 days before appealing to the Tribunal. However, when asked, Mr. Nacewicz admitted that OFCTGMB staff had indicated that he needed to file further documentation in order to complete his transfer application.

Mr. Nacewicz explained he did not want to involve the buyer of his BPQ in the appeal to the Tribunal, as he had already been misled as to the availability of marketing quota. He explained that the buyer who had planned to buy his BPQ with marketing quota attached, was no longer interested in doing so. He said that he could not find a new buyer for the BPQ as potential buyers needed to be assured the OFCTGMB would approve the transfer of BPQ with 2002 marketing quota attached. He said he could not submit the proper documentation to the marketing board without a buyer.

Mr. Nacewicz submitted that the Tribunal had not previously decided the issue that is the subject matter of this appeal. He explained that the Tribunal decision of November 25, 2002 dealt with the question of whether he should be allocated marketing quota and allowed to rent it out to another grower. He said the current purpose of the appeal was to decide whether or not he could sell his BPQ with 2002 marketing quota attached. Mr. Nacewicz explained that he could have sold his BPQ with 2002 marketing quota attached if he had notified the OFCTGMB of his intention to do so before May 31, 2002. He said that he did not intend to do so at that time, but that the OFCTGMB could waive that deadline and allow him to make his application to sell his BPQ, with 2002 marketing quota attached, as long as he paid the late payment fee of $100.00.

Mr. Nacewicz told the Tribunal that the OFCTGMB had distributed unassigned 2002 marketing quota to all producers on January 31, 2003. This included the portion of Mr. Naciewicz's 2002 marketing quota that had been taken away as a result of the Tribunal's upholding of the OFCTGMB's decision to reduce that marketing quota. Mr. Nacewicz submitted that this redistribution of quota was inappropriate, as the OFCTGMB knew that he planned to make an appeal to the Tribunal concerning the transfer of his BPQ with all of his original 2002 marketing quota attached. He acknowledged that he would now be unable to find a buyer who could use the 2002 marketing quota.

In response to questions from the Tribunal Mr. Nacewicz clarified that:

In his previous appeal he had asked that marketing quota be attached to BPQ he held, as well as BPQ jointly held by his mother and his father’s estate. He intended to lease the marketing quota.
He was now asking that marketing quota be attached to his BPQ only, and he intended to sell it.
He was aware on December 4, 2002 that he had to transfer BPQ by December 6, 2002 in order to have 2002 marketing quota attached. He was aware that the OFCTGMB required forms to be filled out.
He had never transferred quota before but Mr. Jenkins, the lawyer retained for the transaction, and his realtor were both familiar with the transfer process and the required forms.
He knew that he had only a small portion of marketing quota attached to his BPQ when he tried to transfer it on December 4, 2002. That marketing quota was issued to him as he had carryover tobacco.

Summation

Mr. Bresner argued that the quota transfer application that Mr. Nacewicz submitted on December 6, 2002 did not constitute a proper application because the proper forms were not submitted to the OFCTGMB to satisfy its policies and procedures and to enable it to set up a hearing to decide the matter. Accordingly, subsection 16(5) of the Act was not satisfied and the matter was not properly before the Tribunal.

In the alternative, Mr. Bresner argued that the Tribunal should use its discretion under subsection 16(4) of the Act and refuse to hear the appeal on the grounds that it is frivolous or vexatious. In support of this argument he submitted that the issues in this appeal were the same issues dealt with by the Tribunal in November 2002. Also, Mr. Bresner submitted that no purpose could be served in hearing the appeal because even if the appeal was successful, no use could be made of the 2002 marketing quota, as the Tobacco Exchange would be closed before the BPQ could be transferred.

Mr. Nacewicz agreed that 2002 marketing quota would not now have any value but he submitted that this was because the OFCTGMB had distributed additional marketing quota on January 31, 2003. He said that he thought everything was in order for the proposed transfer on December 4, 2002 and submitted the OFCTGMB should have accepted the documents that were prepared. He said he did not know what relief he could ask for, but that he felt he had been wronged. He submitted that provincial legislation allowed him the right to appeal the OFCTGMB decisions and the OFCTGMB was attempting to frustrate his appeal.

The Findings

The Tribunal received no evidence to indicate that Mr. Nacewicz or one of his agents had ever prepared all of the documents required by the OFCTGMB in order for it to consider his application to transfer his BPQ with 2002 marketing quota attached. The Tribunal finds that it was reasonable for the OFCTGMB to require its forms to be completed in accordance with its longstanding policy, so that potential creditors of the transferor could be notified before the OFCTGMB dealt with the transfer request. In the absence of a complete request by Mr. Nacewicz to transfer BPQ, the Tribunal finds there was no issue that the OFCTMB was in a position to hear and determine. Under the circumstances, the Tribunal finds that Mr. Nacewicz did not make an application for a hearing within the meaning of subsection 16(5) of the Act, in respect of his request to transfer his Basic Production Quota, with his 2002 marketing quota attached, and the conditions for bringing an appeal have not been met.

In light of this conclusion, it is not necessary for the Tribunal to make findings in relation to the OFCTGMB’s request that the Tribunal exercise its discretion to refuse to hear the appeal under subsection 16(4) of the Act on the grounds that the appeal is frivolous or vexatious.

Decision and Reasons

After careful consideration of the submissions made and the evidence filed, the Tribunal decided to grant the OFCTGMB's request that the Tribunal not hear the appeal by Mr. Nacewicz for the following reason:

Based on the finding that the appellant has not satisfied the requirements for bringing an appeal as set out in subsection 16(5) of the Act, the Tribunal determined that it had no authority to hear the appeal.

Dated at Gravenhurst, Ontario the 20th day of March, 2003.