Citation: Asadi v. Registrar, Real Estate and Business Brokers Act, 2014 ONSC 6517
DIVISIONAL COURT FILE NO.: 506/13
DATE: 20141110
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
SACHS, NORDHEIMER AND POMERANCE JJ.
BETWEEN:
MARYAM ASADI Applicant (Respondent in Appeal)
– and –
REGISTRAR, REAL ESTATE AND BUSINESS BROKERS ACT, 2002 Respondent (Appellant in Appeal)
Doug C. Gosbee, for the Applicant, Respondent in Appeal)
Tim E. Snell and Maya Sabharwal, for the Respondent, (Appellant in Appeal)
HEARD AT Toronto: November 10, 2014
SACHS J. (ORALLY)
[1] The respondent was a former real estate salesperson and mortgage sub-broker in British Columbia. In August of 2008, she agreed to a lifetime suspension of her registration as a mortgage sub-broker. On January 9, 2009, the Real Estate Council of British Columbia suspended her registration as a real estate salesperson for three years. The respondent subsequently moved to Toronto and on August 12, 2012, applied for a registration as a salesperson under the Real Estate and Business Brokers Act, 2002, S.O. 2002, c. 30, Sch. C., as amended (the “Act”).
[2] On February 26, 2013, the appellant Registrar issued a Notice of Proposal to Refuse the Registration of the respondent. The basis of the Proposal was that the respondent’s past conduct in British Columbia, which had led to her suspensions in that province, provided reasonable grounds for belief that the respondent would not carry on business in Ontario in accordance with law and with integrity and honesty. In addition, the Registrar relied on what it alleged was a past lack of financial responsibility on the part of the respondent as on January 9, 1998 the respondent declared personal bankruptcy, which was discharged on October 27, 1998.
[3] On October 16, 2013, the Licence Appeal Tribunal (the “Tribunal”) ordered the appellant to grant the Registration Application of the respondent, as a salesperson. The appellant appeals that decision.
[4] Pursuant to s. 11 of the Act, appeals may be made to this Court from decisions of the Tribunal on questions of law alone. On this appeal, the appellant argues that the Tribunal erred in law because it failed to apply the proper standard of proof when it made the decision it did. The standard of proof set out in s. 10(1)(a)(ii) of the Act is “reasonable grounds for belief.” According to the appellant, the Tribunal applied the higher standard of “balance of probabilities.”
[5] Section 10(1)(a)(ii) of the Act provides as follows:
10(1) An applicant that meets the prescribed requirements is entitled to registration or renewal of registration by the registrar unless,
(a) the applicant is not a corporation and,
(ii) the past conduct of the applicant or of an interested person in respect of the applicant affords reasonable grounds for belief that the applicant will not carry on business in accordance with the law and with integrity and honesty, … (emphasis added).
[6] In the decision under appeal, the Tribunal found at page 2:
DECISION
The Tribunal has considered all of the evidence and rules that the Registrar has failed to prove its case, on a balance of probabilities. Consequently, the Registrar shall license Ms. Asadi as a salesperson under the Act for the reasons which follow. (emphasis added).
[7] The issue raised by this appeal was recently dealt with by the Ontario Court of Appeal in Ontario (Alcohol and Gaming Commission, Registrar) v. 751809 Ontario Inc. (c.o.b. Famous Flesh Gordon’s) 2013 ONCA 157 (“Flesh Gordon’s). In Flesh Gordon’s, the Registrar of the Alcohol and Gaming Commission applied to revoke Flesh Gordon’s liquor licence on the basis that the owner of Flesh Gordon’s was a member of the Hell’s Angels. The Board refused to revoke its licence and the Registrar appealed that decision, first to the Divisional Court (where the decision was upheld) and then to the Court of Appeal where the decision was reversed on the basis of the fact that the Board had applied the wrong standard of proof (balance of probabilities) instead of the one set out in the statute (reasonable grounds for belief). The Court of Appeal sent the matter back to the Board for a reconsideration.
[8] In coming to the conclusion it did, the Court of Appeal made a number of findings that are equally applicable in this case:
(a) The statutory standard of “reasonable grounds for belief”, which is commonly used in regulatory statutes, is a lower standard of proof than “balance of probabilities”. It only requires the Registrar to prove that the respondent’s past conduct provides reasonable grounds for belief that the respondent “will not carry on business with law and integrity and honour. The Registrar does not have to go so far as to show that [the respondent’s] past or present conduct make it more likely than not that [she] will not carry on business as required.” (Flesh Gordon’s, paras. 18 and 19). This portion of Flesh Gordon’s is dispositive of the respondent’s argument that the higher standard of balance of probabilities continued to have a legitimate role in the Tribunal’s analysis.
(b) Where a tribunal applies a higher standard of proof than the statute calls for that is an error of law which is of general importance to the legal system and outside the area of expertise of the tribunal. Thus, the choice of standard of proof should be reviewed on a standard of review of correctness.
[9] In the case at bar, as the above excerpts from the applicable statute and Tribunal decision illustrate, there can be no doubt that the Tribunal applied the wrong standard of proof. Thus, it committed an error of law and its decision must be set aside.
[10] Since we are not satisfied that if the Tribunal had used the proper standard of proof and applied the proper test, refusing to register the respondent as a salesperson would have been the only result the Tribunal could have reached, we would send this matter back to the Tribunal for a reconsideration in accordance with these reasons. In reaching this conclusion, we accept that while past conduct can provide the necessary basis for reasonable grounds for belief, it does not have to. That conduct must be weighed against any evidence of the respondent’s more recent circumstances, including any evidence that would point to the fact that the conduct of concern will not be repeated.
[11] For these reasons, we would allow the appeal, set aside the decision of the Tribunal and send the matter back to the Tribunal for a new hearing in accordance with these reasons.
[12] I have endorsed the back of the Appeal Book, “For reasons given orally, this appeal is allowed. The decision of the Tribunal is set aside and the matter is sent back to the Tribunal for a new hearing in accordance with our reasons. The parties have agreed that in the circumstances of this case, there is to be no order as to costs.”
SACHS J.
NORDHEIMER J.
POMERANCE J.
Date of Reasons for Judgment: November 10, 2014
Date of Release: November 13, 2014
CITATION: Asadi v. Registrar, Real Estate and Business Brokers Act, 2014 ONSC 6517
DIVISIONAL COURT FILE NO.: 506/13
DATE: 20141110
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
SACHS, NORDHEIMER AND POMERANCE JJ.
BETWEEN:
MARYAM ASADI Applicant (Respondent in Appeal)
– and –
REGISTRAR, REAL ESTATE AND BUSINESS BROKERS ACT, 2002 Respondent (Appellant in Appeal)
ORAL REASONS FOR JUDGMENT
SACHS J.
Date of Reasons for Judgment: November 10, 2014
Date of Release: November 13, 2014