Townson v. Ontario (Superintendent Financial Services), 2018 ONFST 11

Citation: Townson v. Ontario (Superintendent Financial Services), 2018 ONFST 11 Decision No. I0707-2016-1 Date: 2018/05/25

IN THE MATTER OF the Insurance Act, R.S.O. 1990, c. I.8, as amended (the “Act”), in particular sections 441.1, 441.2 and 441.3;

AND IN THE MATTER OF a Notice of Proposal to Impose an Administrative Monetary Penalty dated September 26, 2016 against Timothy W. Townson, issued by the Executive Director, Licensing and Market Conduct Division by delegated authority from the Superintendent of Financial Services;

AND IN THE MATTER OF a Hearing in accordance with subsection 441.3(5) of the Insurance Act, R.S.O. 1990, c. I.8.

B E T W E E N:

and

BEFORE:

Paul Farley Chair of the Panel and Member of the Tribunal

WRITTEN SUBMISSIONS:

For the Applicant – No written submissions received.

For the Superintendent of Financial Services – Deborah McPhail

REASONS FOR DECISION

I. INTRODUCTION

1On September 26, 2016 the Superintendent issued a “Notice of Proposal to Impose an Administrative Penalty” (“NOP”) against Timothy W. Townson, the Applicant. Pursuant to section 441.3 of the Act the Superintendent proposed to impose an administrative penalty in the amount of $20,000 on the Applicant for acting as an insurance agent in Ontario without a valid licence during the 20-month period from January 26, 2013 through to September 29, 2014 in contravention of subsection 392.2(6) of the Act and subsection 2(1) of Ontario Regulation 347/04 of the Act.

2On October 17, 2016 the Applicant filed a Request for Hearing in response to the NOP issued by the Superintendent.

II. DECISION

3For the reasons set out below, the Tribunal dismisses this proceeding without a hearing.

III. The Facts

4A pre-hearing teleconference was held on February 2, 2017. That was adjourned at the request of the Applicant to March 8, 2017.

5On March 8, 2017, a pre-hearing teleconference was held. The Superintendent attended by counsel, Ms. McPhail, the Applicant attended on his own behalf. A date was set for hearing, but that hearing date was adjourned at the request of Superintendent’s counsel.

6On May 31, 2017, a further pre-hearing conference was held. The same parties participated. A date for hearing was agreed upon and August 17, 2017 was set as the hearing date. At that time all parties agreed to accept service of documents by email and confirmed that they had the relevant email addresses.

7On August 16, 2017, the Superintendent’s counsel advised that the Applicant had requested an adjournment for medical reasons. As a result, the August 17 hearing was adjourned. The matter was rescheduled for November 3, 2017.

8On November 3, 2017, Superintendent’s counsel was in attendance for the hearing. The Applicant did not attend but was contacted by the Registrar and participated by telephone. On agreement of the parties the matter was adjourned to February 2, 2018 as a pre-hearing conference to allow the Applicant time to provide to the Superintendent information with respect to his medical condition that the parties agreed might have relevance to the NOP issued in this case. The Superintendent was not provided the medical information requested and the matter was adjourned yet again to April 12, 2018. The Registrar confirmed that on February 15, 2018 an e-mail was sent to the parties setting the pre-hearing teleconference for April 12, 2018 at 1:00 p.m. The e-mail sent to Mr. Townson at the email address agreed to by the Parties as the contact e-mail for Mr. Townson did not bounce back.

9On April 12, 2018, Superintendent’s counsel was in attendance for the pre-hearing teleconference, but the Applicant was not. Despite efforts by the Registrar to contact Mr. Townson during the pre-hearing conference (at the telephone number for Mr. Townson agreed upon as his contact number) no response was received.

10On April 12, 2018, I signed a “Notice of Intention to Dismiss” (“NOI to Dismiss”) the proceeding without a hearing, pursuant to Rule 34.01 (now Rule 35.01 as amended) of the Rules of Practice and Procedure for Proceedings before the Financial Services Tribunal (“the Rules”), unless reasonable cause was shown within 30 days that the hearing should continue.

A. The Notice of Intention to Dismiss

11The basis for the NOI to Dismiss was set out within the Notice which was sent to the Applicant at the email address agreed to by the Parties as the contact e-mail for Mr. Townson. The NOI to Dismiss was also sent to the Applicant by registered mail. The e-mail notice did not bounce back, and the registered correspondence was signed for by Mr. Townson and not returned. The NOI to Dismiss was also sent by e-mail to the Superintendent and by way of hand delivery. The e-mails and registered letter were sent on April 12, 2018.

12The NOI to Dismiss advised the Parties that the Tribunal proposed to dismiss this proceeding without a hearing “…if reasonable cause is not shown within 30 days…for Mr. Townson’s failure to appeal at the pre-hearing conference on April 12, 2018.” The basis for the NOI to Dismiss was set out in summary fashion as follows:

On March 8, 2017 there was a continuation of a pre-hearing conference held on February 2, 2017. At the March 8, 2017 pre-hearing conference, the parties confirmed they had provided their relevant e-mail addresses to each other and the Registrar.
On November 3, 2017 a hearing was scheduled and Mr. Townson did not attend, but participated by teleconference only. At the hearing, the matter was adjourned to a pre-hearing teleconference set for February 2, 2018.
On January 29, 2018 the Registrar’s office adjourned the pre-hearing at the request of the Superintendent, and canvassed new pre-hearing dates with the parties. The e-mail from the Registrar’s office was sent to the e-mail address provided by Mr. Townson at the March 8, 2017 pre-hearing conference and informed the parties the new pre-hearing date would be set without consideration for a party’s availability if that party did not provide their availability by February 5, 2018. Mr. Townson did not respond and the e-mail did not bounce back.
On February 15, 2018 an e-mail was sent to the parties setting the pre-hearing teleconference for April 12, 2018 at 1:00 p.m. The e-mail to Mr. Townson did not bounce back.
On April 12, 2018 the Registrar’s office called Mr. Townson at his phone number on file to join the teleconference. Mr. Townson did not respond to the call.

13In the NOI to Dismiss the Parties were advised that they “…have the right to make written submissions to the Tribunal on the issue of reasonable cause for failure to appear, provided they are received within 30 days (bold included) of the giving of this notice…After considering the submissions, if any, the Tribunal may dismiss the proceeding without further hearing or may order it to continue, with or without conditions.”

14In correspondence attached to the NOI to Dismiss and dated April 12, 2018 the Registrar advised the Parties that they have “…30 days from the date of the Notice (until May 14, 2018) to make written submissions to the Tribunal regarding the Notice.” The Registrar cautioned the Parties that “…the Tribunal may dismiss the matter without further hearing or may order it to continue.”

B. Written Submissions

15The Superintendent filed brief submissions accompanied by the Affidavits of Rebecca Loo, an articled student employed by the Ministry of the Attorney General seconded to the Financial Services Commission of Ontario (“FSCO”) and Ronald Clarence McCracken, an investigator employed by FSCO.

16The Applicant filed no submissions.

17The affidavit of Ms. Loo, which I accept as accurate, indicates that Ms. Loo spoke with the Applicant on January 18, 2018 (at the same telephone number used by the Registrar when contacting the Applicant) and requested that he send medical information to verify the Applicant was suffering from a serious health condition as he maintained. The Applicant told Ms. Loo the name of his Doctor and he told her that he would provide a written consent to the Doctor to release medical information.

18The affidavit of Mr. McCracken, which I accept as accurate, details attempts made to contact the Applicant to obtain his signature on an Authorization and Direction to the Applicant’s medical facility to release medical records to FSCO. Mr. McCracken telephoned the Applicant on January 19 and 22, 2018 and left voice mail messages asking the Applicant to call him. He e-mailed the Applicant on January 19, 2018 requesting that the Applicant contact him to arrange for the signing of the medical authorization. Mr. McCracken emailed the Applicant again on January 22, 2018 asking the Applicant to call him as soon as possible to arrange a meeting. Also, on January 22, 2018, Mr. McCracken sent a registered letter containing a medical authorization with the request that the Applicant sign same and then contact Mr. McCracken who would come and pick up the document. No response was received from the Applicant with respect to any of these communications. On February 20, 2018 Mr. McCracken telephoned the Applicant a last time and left a voice message. No response was received.

19On May 17, 2018 Superintendent’s counsel, Ms. McPhail, confirmed to the Registrar that she has not received from the Applicant the requested medical authorization.

C. Analysis

20Rule 35.01 of the Rules provides that:

35.01

Where a party who has initiated a proceeding does not appear at a scheduled hearing or pre-hearing conference of which proper notice has been given in accordance with these Rules, the Tribunal may proceed in the absence of that party, may dismiss the proceeding without further hearing and without further notice, or may give notice of intention to dismiss the proceeding if reasonable cause is not shown within 30 days of the giving of the notice for the party’s failure to appear.

21Rule 35.02 states:

35.02

A party who has been given notice of intention to dismiss under Rule 35.01 shall have the right to make written submissions to the Tribunal on the issue of reasonable cause for failure to appear within 30 days of the giving of such notice. After considering the submissions, if any, the Tribunal may dismiss the proceeding without further hearing, or may order the proceeding to continue, with or without conditions.

22The NOI to Dismiss was sent to the Applicant by electronic mail. The Rules provide that service is effective on the day the electronic message was sent. As indicated, that day is April 12, 2018. As noted in the NOI to Dismiss and in the correspondence sent by the Registrar accompanying the NOI to Dismiss, the Applicant was required to file submissions, if he intended to do so, on or before May 14, 2018 (May 12, 2018 being a Saturday). He did not do so.

23I have considered the submissions made by the Superintendent’s counsel and the affidavit material attached. I have concluded that there has been no reasonable cause shown by the Applicant for his failure to attend the pre-hearing teleconference on April 12, 2018. On the contrary, there is no explanation by the Applicant for his non-attendance whatsoever, despite the Applicant being given ample opportunity to provide an explanation.

24In my view, the Superintendent, in this case, has taken extraordinary steps to facilitate the Applicant’s participation in this process, a process initiated by the Applicant with the filing of a Request for Hearing on October 17, 2016, 19 months ago. All the steps taken by the Superintendent to effectively engage the Applicant have proved fruitless.

IV. ORDER

25As the Applicant did not provide reasonable cause for his failure to participate on the April 12, 2018 pre-hearing conference, the Tribunal, in accordance with Rule 35.02 of the Rules, hereby Orders that the proceeding commenced by the Applicant’s Request for Hearing filed October 17, 2016 be dismissed without further notice.

Dated at Toronto, this 25th day of May, 2018.

“Paul Farley” Paul Farley