FINANCIAL SERVICES TRIBUNAL
IN THE MATTER OF the Mortgage Brokerages, Lenders and Administrators Act, 2006, S.O. 2006, c.29 (the “Act”), in particular sections 14, 18, 19, 21, and 35;
AND IN THE MATTER OF the Notice of Proposal to Revoke Licences dated December 13, 2018, issued by the Superintendent of Financial Services;
AND IN THE MATTER OF Requests for Hearing in accordance with section 21(3) of the Act.
B E T W E E N:
MONEY GATE CORP., MORTEZA KATEBIAN, and PAYAM KATEBIAN
APPLICANTS
and
CHIEF EXECUTIVE OFFICER of the FINANCIAL SERVICES REGULATORY AUTHORITY
RESPONDENT
BEFORE:
Paul Farley Chair of the Panel and Member of the Tribunal
APPEARANCES:
For the Applicants – No submissions filed
For the Chief Executive Officer – Michael Spagnolo
REASONS FOR DECISION
I. INTRODUCTION
1On August 25, 2021, a pre-hearing teleconference (“PHC”) was held in the above matter, chaired by Paul Farley, Member, Financial Services Tribunal (“Tribunal”).
The following parties were represented as follows:
The Applicants – Adam Wygodny
Superintendent of Financial Services – Michael Spagnolo
II. Preliminary matters
2At the pre-hearing conference (“PHC”) on July 26, 2021, Superintendent’s counsel raised certain jurisdictional issues. On July 30, 2021, Superintendent’s counsel filed written submissions on behalf of the Chief Executive Officer of the Financial Services Regulatory Authority of Ontario (“the CEO”) regarding the jurisdictional issues. Counsel for the Applicants, having been provided the opportunity to file responding submissions by August 20, 2021, did not do so.
3In their written submissions the CEO argued that FSRA and this Tribunal no longer have jurisdiction to revoke the mortgage broker licence of Morteza Katebian (“M. Katebian”) and the mortgage agent licence of Payam Katebian (“P. Katebian”) as both licences have expired and neither M. Katebian nor P. Katebian submitted a renewal application in accordance with the Act. FSRA requested that these proceedings, insofar as they pertain to M. Katebian and P. Katebian be dismissed without hearings.
4There is no request to dismiss proceedings regarding the brokerage, Money Gate Corp.
5At the pre-hearing conference I made an Order dismissing these proceedings pertaining to M. Katebian and P. Katebian. These are my reasons for doing so.
III. The Facts
6On December 13, 2018, the Financial Services Commission of Ontario (“FSCO”) the predecessor regulatory authority to FSRA, issued a Notice of Proposal (“NOP”) pursuant to sections 19 and 21 of the Act to revoke the licenses of each of the Applicants.
7Requests for hearing were filed on behalf of each of the Applicants on December 27, 2018.
8On March 31, 2020, the mortgage broker licence (M08007482) of M. Katebian expired.
9On March 31, 2020, the mortgage agent licence (M14000193) of P. Katebian expired.
10M. Katebian and P. Katebian did not apply to renew their respective mortgage licences and at the present time neither have a mortgage licence.
IV. Matters in Issue
11The issues before the Tribunal are simply:
a. Do FSRA and the Tribunal have jurisdiction to revoke a mortgage agent and mortgage broker licence after the licences expire?
b. If no, should the Requests for Hearing filed by M. Katebian and P. Katebian be dismissed?
V. The Position of the Parties
12The CEO argues that the Tribunal has no jurisdiction to determine whether the NOP issued December 13, 2018, should be carried out given the fact that M. Katebian and P. Katebian no longer have mortgage licences.
13Counsel for M. Katebian and P. Katebian noted that he has no instructions from his clients but agreed that the application of the CEO can proceed unopposed.
VI. Analysis
14This Tribunal was faced with a similar circumstance in the case of Grange v. Ontario (Superintendent of Financial Services)1. In that case Mr. Grange was licensed as a mortgage agent under the Act when a NOP to revoke his licence was issued on the grounds, like here, that he was unsuitable to be licensed.
15Mr. Grange filed a Request for Hearing within the time prescribed but, before the hearing could take place, his license expired. The Tribunal then issued a Notice of Intention to Dismiss pursuant to Rule 33.01 of the Rules of Practice and Procedure for Proceedings Before the Financial Services Tribunal (“the Rules”) on the basis that the Tribunal had no jurisdiction to determine whether the NOP should be carried out, given that the Applicant was no longer licensed under the Act. Receiving no submissions, the Tribunal dismissed the Request for Hearing because the NOP to revoke the licence of Mr. Grange had become moot.
16I agree with the reasoning in the Grange case. Where a NOP to revoke a licence is issued, and that licence expires before a requested hearing takes place, the NOP issued becomes moot.
17Typically, a request for dismissal by a Party will be brought by way of Motion for Summary Dismissal in accordance with Rule 36.01. Although the process followed here did not comply with the Rules there was no objection made by counsel on behalf of the affected Applicants and, as a result, pursuant to Rule 13.02, I waive strict compliance with the Rules, and make the Order requested.
VII. Order
18It is HEREBY ORDERED that: these proceedings arising out of a Request for Hearing brought by M. Katebian dated December 27, 2018, are dismissed.
19It is FURTHER ORDERED that: these proceedings arising out of a Request for Hearing brought by P. Katebian dated December 27, 2018, are dismissed.
20It is FURTHER ORDERED that these proceedings involving the remaining Party, Money Gate Corp., be adjourned sine die.
Dated at Toronto, this 23rd day of September, 2021.
“Paul Farley” Paul Farley