Citation: Willis v. Ontario (Superintendent Financial Services), 2016 ONFST 13 Decision No. I0676-2016-1 Date: 2016/07/25

IN THE MATTER OF the Insurance Act, R.S.O. 1990, c. I.8, as amended (the "Act"), in particular sections 393(9) to 393(11);

AND IN THE MATTER OF a Decision and Order dated February 8, 2016 of the Executive Director, Licensing and Market Conduct Division of the Financial Services Commission by delegated authority from the Superintendent of Financial Services;

AND IN THE MATTER OF a Notice of Appeal in accordance with section 17(1) of the Act filed by Jeffrey Murray Willis.

and

BEFORE:

Denis Boivin Chair of the Panel and Vice-Chair (Acting) of the Tribunal

For the Applicant – Barry B. Papazian

For the Superintendent of Financial Services – Deborah McPhail

1The Applicant in this matter, Jeffrey Murray Willis, is licensed to sell life insurance in the Province of Ontario. On February 8, 2016, the Executive Director of the Licensing and Market Conduct Division of the Financial Service Commission (the "Director"), by delegated authority from the Superintendent, issued an Order suspending the licence of Mr. Willis for a minimum period of nine (9) months and imposing a number of conditions on said licence for a further period of twenty-four (24) months. This Order became effective on February 15, 2016, approximately five (5) months ago.

2The Director's Order was made pursuant to statutory provisions that are no longer in force today, namely, subsections 393(9) to 393(11) of the Insurance Act, R.S.O. 1990, c. I-8. At the relevant time, these provisions authorized the Superintendent to appoint a three-person Advisory Board (the "Board") in order to hold a hearing, before deciding whether to revoke or suspend an agent's licence on the grounds of unsuitability. In this case, the hearing took place on June 15, 2015 and August 10, 2015, and the Board released its written recommendations on November 19, 2015. The panel was unanimous with respect to the most important allegation made against Mr. Willis: according to the Board, the allegation that Mr. Willis was unsuitable to remain licensed had been established. However, the panel was divided with respect to their recommendation on penalty. The majority of the Board recommended a suspension of the Applicant's licence for twelve (12) months, followed by conditions for an additional twelve (12) months, whereas the minority recommended a revocation.

3On February 23, 2016, Mr. Willis filed a Notice of Appeal with the Registrar of the Financial Services Tribunal (the "Tribunal") with respect to the Order issued by the Director. His right to appeal is based on subsection 393(10.1) of the Insurance Act, as it existed at the relevant time, and is governed by the terms of section 17. Pursuant to subsection 17(6) of the Insurance Act, "[t]he filing of a notice of appeal does not stay the decision of the Superintendent but the Tribunal may grant a stay until it disposes of the appeal."

4On May 3, 2016, during the first prehearing teleconference held in this matter, I was informed that Mr. Willis was requesting a stay of the Order, pending a determination of the merits of his appeal. Both parties were invited to make written submissions and Mr. Willis filed an Affidavit in support of his application. A second prehearing teleconference was held on July 6, 2016, in order to hear brief oral submissions. What follows is my decision with respect to this preliminary issue.

II. ISSUE

5Generally speaking, the question raised by this application is whether the Tribunal should exercise the discretion conferred upon it by subsection 17(6) of the Insurance Act and stay the Order issued by the Director on February 8, 2016, until such time as the matters raised by the underlying appeal are finally determined.

6Both parties submit that the three-stage test established by the Supreme Court of Canada in RJR MacDonald Inc. v. Canada (Attorney General), 1994 117 (SCC), [1994] 1 S.C.R. 311 ("RJR MacDonald") provides appropriate guidance on whether the Tribunal should exercise its discretion under subsection 17(6). I agree with their submissions, given that this approach is consistent with four decisions of the Tribunal involving similar applications: see Rendall v. Ontario (Superintendent Financial Services), 1999 ONFST 5; Global Mortgage Link Corp. v. Ontario (Superintendent Financial Services), 2004 ONFST 3; Shrivastava v. Ontario (Superintendent Financial Services), 2006 ONFST 8; and Joshi v. Ontario (Superintendent Financial Services), 2015 ONFST 29.

7Applying the RJR MacDonald test to the circumstances of this case, positive answers to each of the following questions are required before a stay is granted under subsection 17(6) of the Insurance Act:

a. Is there a serious question to be tried on the underlying appeal?

b. Would the applicant suffer irreparable harm if the request for a stay were to be denied?

c. Does the balance of inconvenience favour the granting of a stay?

III. ANALYSIS

Serious Question

8The first question is whether the appeal launched by Mr. Willis raises a serious question to be tried. The Supreme Court of Canada has observed that this stage of the test represents a low threshold, and that the decision-maker should proceed to consider the second and third stages of the test once satisfied that the underlying claim is neither frivolous nor vexatious: RJR MacDonald, supra at pp. 337 – 338. A prolonged examination of the merits of the appeal is neither necessary nor desirable: RJR MacDonald, supra at p. 338.

9Given the applicable standard, I am not surprised that counsel for the Superintendent expressly concedes that Mr. Willis "may have satisfied the first criterion" (Written Submissions, para. 2). Indeed, having reviewed his Notice of Appeal, I find that his appeal is neither frivolous nor vexatious. On the contrary, he raises a serious question, namely, whether the Director took into account all relevant factors in deciding the case on the merits and in deciding on the appropriate penalty to be imposed on him.

Irreparable Harm

10The second question is whether Mr. Willis would suffer irreparable harm if his request for a stay were denied. In a similar case, the Court of Appeal cautioned that "[e]vidence of irreparable harm must be clear and not speculative, and it must be supported by evidence that [the applicant] would suffer it." See Sazant v. College of Physicians & Surgeons (Ontario), 2011 CarswellOnt 15914 at para. 11 ("Sazant"). In this case, what evidence of irreparable harm do I have before me?

11In his Affidavit, sworn on June 6th, Mr. Willis states that he is currently employed with a company called Strategic Alliance Finance Group ("SAFG") as the director of their estate services division. He describes his job as follows: "I work with brokers regarding estate planning and other consulting work, which is a back office function." According to his Affidavit, Mr. Willis has been associated with SAFG since 2010, well before the Board held its hearing in this matter. During this hearing, the president of SAFG (Gary Michael Levy) gave character evidence in favour of the Applicant. In particular, Mr. Levy stated that Mr. Willis was precise, detailed, trustworthy, competent and that he did a good job helping brokers and clients. Two weeks ago, during the prehearing teleconference of July 6th, the lawyer for Mr. Willis confirmed that his client remains employed with SAFG and remains in good standing.

12In his Affidavit, Mr. Willis states that the suspension of his life insurance licence "poses a direct risk" to his livelihood and his ability to provide for his family. He bases this belief on a comment that was allegedly made to him by Mr. Levy prior to February 8, 2016, the date on which the Director issued his Order in this matter. However, the evidence before me suggests otherwise; despite having his licence suspended, the Applicant's employment with SAFG has remained the same in the past five months. Furthermore, during the July 6th prehearing teleconference, counsel for the Mr. Willis said that he has no confirmation from SAFG that his client would lose his job, and described the risk of harm to Mr. Willis as a "potential prejudice".

13Applying the words of caution expressed by the Court of Appeal in Sazant, the evidence of irreparable harm presented by Mr. Willis is far from clear. Compounding matters, Mr. Willis says in his Affidavit that he will "undertake not to engage in any activity dealing directly with the public with regard to the sale or promotion of any insurance product", if the Tribunal grants him the requested stay. In other words, the Applicant is fully prepared to refrain from doing, on a voluntary basis, what the Director's Order currently compels him to refrain from doing. In these circumstances, what is the practical difference between the Director's Order and the Applicant's undertaking, in terms of the harm created to the livelihood of Mr. Willis and his ability to provide for his family?

14For these reasons, I conclude that it has not been established that the Applicant would suffer irreparable harm if his request for a stay were to be denied. Although this conclusion is enough to dispose of this Application, I will say a few words about the third stage of the RJR MacDonald test.

Balance of Inconvenience

15The third question is whether the balance of inconvenience favours the granting of a stay. This stage involves comparing the risk of harm caused to Mr. Willis to the risk of harm to the public interest if the Application were to be granted. In essence, which of the parties will suffer the greater harm from the granting or refusal of a stay, pending a final determination of the appeal? As noted in RJR MacDonald, the factors which must be considered at this stage of the inquiry are numerous and they will vary in each individual case: supra, at p. 342. In the current context, it must be kept in mind that the Superintendent and his delegates are not private parties, pursuing their own personal interests; they are agents of the Government, mandated by legislation to provide regulatory services that protect the public interest and enhance public confidence in the regulated sectors: Financial Services Commission of Ontario Act, 1997, S.O. 1997, ss. 3 and 5.

16As noted by the Ontario Court of Appeal, public safety is only one facet of the public interest: Sazant, supra at para. 15. During the third stage of the RJR MacDonald test, the decision-maker must also consider the impact of granting a stay on "public confidence in the administration of justice, and in cases such as this, confidence in the disciplinary process": Sazant, supra at para. 15. In this case, public confidence in the ability of the Superintendent and his delegates to discipline members of the insurance industry is a consideration that weighs against the granting of a stay of the Director's Order. When this consideration is set against the speculative nature of the risk of harm to Mr. Willis, I find that the former outweighs the latter.

IV. ORDER

17The Application for a stay of the Director's Order is hereby dismissed.

Dated at Toronto, this 25th day of July, 2016.

"Denis Boivin" Denis Boivin