The applicant, a milk processor, sought judicial review of two decisions by the Agriculture, Food and Rural Affairs Appeal Tribunal upholding the Dairy Farmers of Ontario's (DFO) order requiring the applicant to pay approximately $7 million for milk pricing adjustments.
The DFO had charged the applicant the highest price for milk after audits revealed the applicant's Milk Utilization Verification (MUV) declarations could not be verified due to inadequate record-keeping.
The Divisional Court dismissed the application, finding the Tribunal's interpretation of the regulatory scheme—that MUV declarations must be verifiable—was reasonable.
The Court also upheld the Tribunal's findings that the higher price was a surcharge, not a penalty, and that the interlocutory order requiring a $3.3 million letter of credit was reasonable.