Court File and Parties
CITATION: Round v. Institute of Chartered Accountants of Ontario, 2015 ONSC 7099
DIVISIONAL COURT FILE NO.: 269/15
DATE: 2015-12-07
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
Molloy, Linhares de Sousa and Wilton-Siegel JJ.
BETWEEN:
GARRY ROUND
Applicant
– and –
INSTITUTE OF CHARTERED ACCOUNTANTS OF ONTARIO
Respondent
COUNSEL:
Matthew Latella and Ahmed Shafey, for the Applicant
Paul Farley and Brian Bellmore, for the Respondent
HEARD: October 26, 2015 (at Toronto)
BY THE COURT:
REASONS FOR JUDGMENT
Introduction
[1] The Applicant, Mr. Garry Round, brings a Judicial Review Application seeking to quash the decisions of the Respondent, the Institute of Chartered Accountants of Ontario o/a Chartered Professional Accountants of Ontario (“CPAO”) to firstly, embark on an inquiry regarding information which came to its attention indicating a possible breach by the Applicant of the CPAO’s Rules of Conduct and to secondly, issue allegations of misconduct against the Applicant for failing to cooperate with the regulatory process of the CPAO contrary to Rule 104 of the Rules of Professional Conduct.
[2] The Applicant submits that the CPAO exceeded its jurisdiction by initiating investigative proceedings against him and because of that its actions should be declared ultra vires.
[3] The Applicant also contends that the Respondent’s refusal to identify the precise source and context of the complaint against him was a denial of his rights to natural justice and procedural fairness.
[4] The Respondent Institute seeks the dismissal of the Application on the basis that: (i) the Application for Judicial Review is premature, (ii) the Institute’s investigations are within its jurisdiction, and (iii) the investigative procedure discloses no procedural unfairness or breach of natural justice.
[5] For the reasons set out below, it is our opinion that Mr. Round’s Application for Judicial Review to quash the decisions of the Respondent should be dismissed. The issues of jurisdiction should first be raised before the CPAO before this Court is called upon to review them. We see no breach of natural justice or procedural fairness with respect to the investigative procedure or the decision to proceed against Mr. Round for failing to cooperate with the CPAO investigation.
FACTUAL AND PROCEDURAL BACKGROUND
[6] The Applicant is a Certified Professional Accountant (“CPA”) and a Chartered Accountant (“CA”). There is no dispute that the Applicant is a member of the CPAO and that his professional activities, as a CPA and CA are governed by that body, as the self-regulating professional body governing CAs, pursuant to the Chartered Accountants Act, 2010, S.O. 2010, c. 6 (the “Act”), and the ByLaws, Regulations and Rules of Conduct of the CPAO established pursuant to the Act.
[7] The Applicant is employed in a company operating as Ryan ULC (“Ryan”), a Canadian affiliate of a global professional services firm, employing among other professionals, CPAs and of which the Applicant is the President of Canadian Operations and Principal. It is not disputed that the CPAO has no jurisdiction to investigate Ryan but does assert jurisdiction over any Ryan employees who are members of CPAO, such as the Respondent.
[8] On June 12, 2014, the Director of Standards Enforcement of the CPAO communicated with the Applicant informing him that it had come to the attention of the Professional Conduct Committee (“Committee”) that the Applicant may be providing accounting services to the public through Ryan ULC which was not registered as a firm with the CPAO contrary to the Bylaws, Rules and Regulations of the CPAO. As a result, the Committee wished to commence a review of the situation and sought certain information from the Applicant in the furtherance of that review. The Committee wished to review and understand the types of services offered to the public by all CPAO members employed by Ryan and the Applicant was being contacted in his role as President of Ryan.
[9] The initial communication from the Committee was followed by numerous exchanges of correspondence between the Applicant’s counsel (Ryan’s counsel) and the Committee that went on between June 2014 and March 2015. In brief, the communications sent on behalf of the Respondent sought from the Committee the full particulars, including the identity of the “complainant” who made the complaint which initiated the review by the Committee. The Applicant was informed by the communications sent to him by the Committee, in brief, that with respect to the Committee’s inquiry, when Standards Enforcement staff was reviewing an unrelated matter, the staff member noted that Ryan’s website indicated that Ryan was employing CPAO members and offering a number of tax related services that could fall under the CPAO By law governing the provision of accounting services to the public. The parties could not agree on how much more information should, could or would be given to the Applicant’s counsel about the investigation and particularly about the identity of the “complainant” that had initiated the investigation of Mr. Round. The information sought by the Committee was not forthcoming from Mr. Round.
[10] On March 4, 2015, and without any further notice or consultation, Mr. Round was directly served with a Notice to a Member to Attend before the Professional Conduct Committee on March 24, 2015, which notice also repeated the request for information which the Committee had been seeking from the Respondent since June of 2014. Mr. Round’s counsel responded by advising the Committee that Mr. Round intended to apply for Judicial Review of the CPAO’s decisions. Mr. Round did not appear before the Professional Conduct Committee on March 24, 2015, nor did he produce any information sought by the Committee.
[11] On May 17, 2015, a copy of the Respondent’s Allegations of Professional Misconduct was served on counsel for Mr. Round who accepted service on Mr. Round’s behalf, thus commencing the professional misconduct proceedings against Mr. Round. The allegations are based on Mr. Round’s purported failure to cooperate with the Committee by failing to provide information as requested by the Committee in the correspondence sent to Mr. Round between September, 2014 and May, 2015 and on his non-attendance at the meeting on March 24, 2015, stipulated in the Notice to a Member to Attend before the Professional Conduct Committee.
[12] On May 28, 2015, Mr. Round served his Application for Judicial Review on the CPAO.
ANALYSIS AND DISCUSSION
[13] Mr. Round is a member of the CPAO. As such, there is no dispute that the Respondent has the duty and jurisdiction to govern Mr. Round and other members of the Institute in respect of their conduct and practice as CAs and/or CPAs. Its jurisdiction and that of the Committee arises from the Chartered Accountants Act, 2010, S.O. 2010, c. 6 (the “Act”) as well as the ByLaws and Regulations enacted pursuant to the Act, and is carried out in the public interest. Correspondingly, Mr. Round has a professional responsibility to cooperate with the CPAO in its investigations.[^1]
[14] The judicial review remedies sought in this case are discretionary. While this Court has the power to intervene in an administrative proceeding, it will rarely do so until the administrative process has run its course and all avenues of appeal within that process have been exhausted.[^2] This Court’s reluctance to interfere, particularly at an early stage of an administrative proceeding, is grounded in public policy, respect for Parliamentary intention and deference to administrative tribunals. The efficacy of such tribunals depends on their ability to conduct their own matters in a timely and expeditious manner. Constant disruptions in the process while parties take their grievances to the Court are not, generally speaking, in the public interest. That is not to say that the Court will never intervene while an administrative process is still ongoing. However, this will normally only be justifiable where there is a clear excess of jurisdiction or egregious and irremediable breach of natural justice, and, even in those situations, the Court may decline to exercise its discretion.[^3]
[15] In this case, the Applicant argues that the CPAO had no jurisdiction to investigate in the absence of an identified complainant. Even accepting that this is a “true” issue of jurisdiction (which is doubtful[^4]), it is our view that this is not an appropriate case for this Court to intervene. Central to the determination of the tribunal’s “jurisdiction” are issues involving the proper interpretation of the tribunal’s home statute, its ByLaws and its Regulations. The tribunal itself should be given the opportunity to interpret those sources and determine its own powers before this Court should offer its own interpretation. It is premature for this Court to deal with the issue now.
[16] We are not convinced that Mr. Round has been denied natural justice. In the multiple letters that went on between the CPAO and Mr. Round’s counsel leading up to the receipt of the Notice to a Member to Attend before the Professional Conduct Committee, the Applicant was fully informed of the reason for the investigation, namely, that there may have been the provision of accounting services to the public and other members through an unregistered firm. Accordingly, Mr. Round was provided with information regarding the “matters being investigated” pursuant to section 15 of Regulation 7-1 which reads as follows:
- The subject(s) of the investigation and their firm(s), if applicable, shall be notified in writing of the investigation, and of the matter(s) being investigated, whether or not they were the subject of the complaint, and shall be notified of any expansion or alteration of the matters investigated. Such notice shall include a reminder of their professional responsibility to cooperate and of the possibility that some client documents in their possession might be subject to legal privilege, and shall further caution the subject(s) of the investigation that the failure to produce a document that is not privileged might breach their professional responsibilities.
[17] At that stage of the investigation there was no duty on the Respondent to disclose the name of the employee who identified the Ryan ULR website. But, Mr. Round clearly had a duty to cooperate and provide the information requested by the CPAO. Despite the many declarations in the letters written by his counsel to the CPAO, that Mr. Round wished to cooperate with the PCC’s process and investigation, he clearly did not. He never provided the information or the documents requested by the CPAO leading to the Notice to a Member to Attend before Professional Conduct Committee and ultimately to the disciplinary process.
[18] We conclude that the decision of this court in D’Mello v. The Law Society of Upper Canada, 2015 ONSC 5841, is directly on point and ought to be applied to the facts of this case. It is not for Mr. Round to challenge the bona fides of the investigation at this stage. His duty is to cooperate.
[19] For these reasons, Mr. Round’s Application for Judicial Review is dismissed.
COSTS
[20] Counsel in this matter agreed that costs would be fixed at $10,000 and would follow the cause. As a result, the Applicant is ordered to pay costs to the Respondent fixed in the amount of $10,000 all-inclusive.
Molloy J.
Linhares de Sousa J.
Wilton-Siegel J.
Released: December 7, 2015
CITATION: Round v. Institute of Chartered Accountants of Ontario, 2015 ONSC 7099
DIVISIONAL COURT FILE NO.: 269/15
DATE: 2015-12-07
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
Molloy, Linhares de Sousa and
Wilton-Siegel JJ.
BETWEEN:
GARRY ROUND
Applicant
– and –
INSTITUTE OF CHARTERED ACCOUNTANTS OF ONTARIO
Respondent
REASONS FOR JUDGMENT
Molloy J.
Linhares de Sousa J.
Wilton-Siegel J.
Released: December 7, 2015
[^1]: Wise v. Law Society of Upper Canada, 2010 ONSC 1937 at para. 19 (Div.Ct.) [^2]: Ontario College of Art v. Ontario (Human Rights Commission) (1993), 1993 3430 (ON SCDC), 11 O.R. (3d) 798 (Div.Ct.); Harelkin v. v. University of Regina, 1979 18 (SCC), [1979] 2 S.C.R. 561; Volochay v. College of Massage Therapists of Ontario, 2012 ONCA 541 (C.A.) [^3]: Volochay, supra, at paras. 63 and 67 [^4]: C.B. Powell Ltd. c. Canada (Agence des services frontaliers), 2010 FCA 61, 2010 SCA 61, [2011] 2 F.C.R. 332 (F.C.A.) at para. 42; Alberta (Information and Privacy Commissioner) v. Alberta Teachers' Association, [2011] 3 SCR 654, 2011 SCC 61, at paras. 37-42