Citation: Ulrich v. Ontario (CEO of FSRA), 2021 ONFST 6 FST File No. I0879-2019 Date: 2021/06/04

IN THE MATTER OF the Insurance Act, R.S.O. 1990, c. I.8, as amended (the "Act") in particular sections 392.5 and 407.1;

AND IN THE MATTER OF the Notice of Proposal to Revoke Licence dated January 9, 2019 (the "NOP"), 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 Request for Hearing in accordance with section 407.1(3) of the Act.

and

CHIEF EXECUTIVE OFFICER of the FINANCIAL SERVICES REGULATORY AUTHORITY

and

HER MAJESTY the QUEEN in RIGHT of the

PROVINCE of ONTARIO as represented by the

ADDED PARTY AG

BEFORE:

Paul Farley Chair of the Panel and Member of the Tribunal

APPEARANCES:

For the Applicant – Mr. John McNabb

For the Chief Executive Officer – Mr. Michael Spagnolo, legal counsel with Kate No, Tony Yin and Warren Urquhart, Law Clerks

For the Added Party AG – Mr. Walid Malik, legal counsel for the Attorney General

DATE HEARD: May 21, 2021

REASONS FOR DECISION

I. INTRODUCTION

1On May 21, 2021, a pre-hearing teleconference ("PHC") was held in the above matter, chaired by Mr. Paul Farley, Member, Financial Services Tribunal ("Tribunal").

2At the PHC of April 13, 2021, a timetable was set to hear argument with respect to the following issue:

Has the motion brought by the Applicant for the recusal of Mr. Ian McSweeney become moot since Ms. Ulrich no longer has a licence and the issue before Mr. McSweeney was with regard to a NOP to revoke the licence of Ms. Ulrich? ("the mootness issue")

3In accordance with the timetable set, the CEO filed submissions on April 21, 2021, and the Applicant filed submissions on April 30, 2021.

4The Applicant, in their submission, raised a new issue as to whether I should hear the mootness issue because there was a motion outstanding (filed January 19, 2021) brought by the Applicant for my recusal (the "Farley recusal motion") from hearing the motion for recusal of Mr. McSweeney (the "McSweeney recusal motion").

5On May 5, 2021, I asked the Registrar to write to the parties as follows:

The Chair has received the submissions of the Parties with respect to the mootness issue. The Applicant has raised a new issue and argument with respect to whether the Chair should recuse himself from hearing the mootness issue. The Respondent CEO is invited to make submissions with respect to this new issue raised by the Applicant. Any submissions of the CEO are to be filed with the Registrar on or before May 12, 2020.

In addition, both parties are invited to make further written submissions, on or before May 12, 2021, with respect to the effect of section 407.1(9) of the Insurance Act on section 407.1(8). In particular have "...the rights of the parties.... been exhausted or...expired..." with the expiry of the Applicant's licence on January 16, 2021, and if not what rights remain?

6On May 6, 2021, the Applicant wrote to the Chair, through the Registrar, arguing that the request for further submissions on the mootness issue was unfair because it did not follow a process where the CEO would make submissions, the Applicant would respond, and the CEO would have a right of reply. In addition, the Applicant argued that a timetable should be set for the CEO to respond to the motion for my recusal brought by the Applicant.

7On May 7, 2021, I asked the Registrar to write to the parties as follows:

The Chair would like to set a date for a PHC to deal with the following issues:

Set a timetable for dealing with the Motion for Recusal (Mr. Farley) filed by the Applicant on January 18, 2021, including a timetable for a response from the CEO and a reply from the Applicant.
Set a timetable for filing submissions in response to the Chair's enquiry with respect to the effect of section 407.1(9) of the Insurance Act on section 407.1(8).

The May 12, 2021 deadline previously set for the filing of submissions on whether the Chair should recuse himself on the mootness issue and the section 407.1(9) issue are set aside.

8On May 20, 2021, the day before the date set for this PHC, the Applicant wrote to the Chair through the Registrar arguing that, on the grounds of fairness, it is inappropriate for me to deal with any of the issues on this matter because of what the Applicant described as: "a clear and on-going apprehension of bias by the Applicant with respect to both your continuing presence and adjudicative conduct in this Proceeding." The Applicant submitted that I should recuse myself immediately prior to the commencement of this PHC.

9I declined to recuse myself prior to hearing from the Parties.

10After hearing from the Parties, I declined to recuse myself from hearing the Farley recusal motion. My reasons follow.

II. Position of the Applicant

11At this PHC the Applicant reiterated the position set out in his email of May 20, 2021. Essentially the Applicant takes the position that, should I hear the Farley recusal motion, I am adjudicating matters in my own cause. That, the Applicant says, is contrary to the rules of natural justice.

12The Applicant further argues that should I decide the mootness issue I am deciding an issue in which I have a clear interest "...since Chair McSweeney has authority over your employment, work assignments and income-earning ability at FSTO."

III. Position of the Respondent and the Added Party

13The Added Party makes no additional submission with respect to the Farley recusal motion and agrees with the submission of the CEO.

14The CEO submits that it is not contrary to the rules of natural justice for an adjudicator whose independence has been questioned on a recusal motion to hear the matter. The CEO referred to several cases in support of his position.

IV. Analysis

15At this PHC the first issue for determination is whether I should recuse myself from hearing the Farley recusal motion. If the answer to that question is yes, then the mootness issue and the Farley recusal motion will have to be adjourned sine die to be dealt with by another adjudicator.

16In my view the Farley recusal motion should be heard by me, the adjudicator against whom the motion is made.

17In the case of SOS-Save Our St. Clair Inc. v. City of Toronto et al.¹ an application was made by the City of Toronto for Justice Matlow to recuse himself from the case after the three-member Divisional Court had made their decision but before they had released their final Order or their reasons. It was argued that Justice Matlow was biased.

18The two other Justices that had heard the case, Justices Greer and Macdonald, in separate reasons, concluded that it was appropriate that Justice Matlow decide whether or not there was a reasonable apprehension of bias sufficient to require his recusal. They wrote that it was agreed, after the panel heard submissions on the recusal motion, "...that Justice Matlow would first prepare his reasons on the matter of his recusal. This decision is one that he alone must make." Later they noted "It is not for us to say that Justice Matlow ought to recuse himself." ²

19In a subsequent case, R. v. Anderson³ the British Columbia Court of Appeal was hearing an application by the Crown to quash an appeal. The Appellant sought an order that the judge recuse himself on the basis of an apprehension of bias, in part because the judge had made a judgement in another case that was detrimental to the position being taken on the appeal by the Appellant.

20The judge who was the subject of the recusal application determined that it was appropriate for him to hear the recusal application himself. Justice Groberman wrote:

2The law is now, I think, well-settled that it is up to the individual judge whose recusal is sought to make the decision – see SOS-Save our St. Clair Inc. v. City of Toronto (2005), 2005 40559 (ON SCDC), 261 D.L.R.(4th) 727, particularly at paras. 1 and 19-21 of the discussion of Greer and MacDonald JJ. that follows the decision of Matlow J.⁴

21I am cognizant of the fact that there are significant differences between a judge of the superior courts and a member of an administrative tribunal and that the precedents cited by the CEO are not specific to administrative tribunals. I am satisfied, however, that the principles that apply to an application for recusal of a judge apply to an adjudicator in the administrative sphere.

22Then Applicant argues that Mr. McSweeney recused himself from hearing the McSweeney recusal motion and his decision to do so establishes a precedent that I am bound to follow. I disagree. While decisions of other tribunal members and other panels are persuasive, they are not binding authority. In this case while Mr. McSweeney did recuse himself, he issued no reasons for doing so. The mere fact of another panel member's decision to recuse himself is not persuasive authority for me to do the same.

23In this case the Applicant has already brought one motion for recusal of Mr. McSweeney. A second, Farley recusal motion is brought with respect to my hearing the McSweeney recusal motion. And now a third recusal motion wherein the Applicant is seeking to have me recuse myself from hearing the Farley recusal motion. Based on the authorities referred to above I decline to do so, as I advised the parties at the PHC on May 21, 2021.

V. The Farley Recusal Motion

24The CEO submitted that there is no evidence underlying the Farley recusal motion brought by the Applicant. The CEO submitted that there should be a timetable agreed upon so that the parties can work together to prepare and file an Agreed Book of Documents ("ABD") and an Agreed Statement of Facts ("ASF"). The Applicant agreed.

25The added party reserved the right to make submissions on the Farley recusal motion and indicated their wish to be involved in the preparation of an ASF and an ABD.

26As a result, the parties agreed to the following timetable:

On or before June 2, 2021 – the Applicant will provide to the other parties all the documents that the Applicant will rely upon in support of the Farley recusal motion.

On or before June 9, 2021 – the CEO and the added party will respond to the Applicant's documents and provide to the Applicant any additional documents that they intend to rely upon.

On or before June 23, 2021 – the Applicant will prepare and serve on the other parties a first draft of an ASF.

On or before July 9, 2021 – the parties will file with the Registrar the ASF and the ABD prepared by the parties.

27No timetable was set for the CEO and the added party to file written submissions and for the Applicant to reply to those submissions. The parties are asked to set a timetable for doing so. If the parties cannot agree then the matter can be brought back before me, and I will set a timetable for the filing of submissions.

28Following the filing of materials, a date for the hearing of the Farley recusal motion will be selected by way of email correspondence.

VI. Orders

29It is hereby ORDERD THAT the Applicant's request that I recuse myself from hearing the Farley recusal motion is denied.

30It is further ORDERED THAT the parties adhere to the timetable set out above.

Dated at Toronto, this 4th day of June, 2021.

"Paul Farley" Paul Farley

Footnotes

SOS-Save Our St. Clair Inc. v. City of Toronto et al., 2005 40559 (ONSCDC)
Ibid., paras. 1, 19-21 of the reasons of Greer and Macdonald, JJ
R. v. Anderson, 2017 BCCA 154
Ibid., para. 2