Licence Appeal Tribunal
Tribunal d'appel en matière de permis
FILE: 7605/MVIA
CASE NAME: 7605 v. Registrar of Motor Vehicles
Appeal under Section 50.2 of the Highway Traffic Act, R.S.O. 1990, c. H.8 from an Impoundment Pursuant to Section 55.1(3) of the Act.
Enterprise Rent A Car Canada Company Applicant
-and-
Registrar of Motor Vehicles Respondent
REASONS FOR DECISION AND ORDER
ADJUDICATOR: ANTOINE AOUAD, M.D., Member
APPEARANCES:
For the Applicant: CHRIS NIELSEN-JONES, Agent
For the Respondent: SONIA DE SANTIS, Agent
Heard by teleconference: September 20, 2012
REASONS FOR DECISION
A hearing was held on September 20, 2012, at Toronto, Ontario, by teleconference to consider the Applicant’s appeal pursuant to section 50.2 of the Highway Traffic Act, R.S.O., 1990, c. H.8 (the “HTA” or the “Act”).
THE TRIBUNAL ORDERED THE REGISTRAR TO RELEASE THE MOTOR VEHICLE pursuant to section 55.1(3) of the HTA.
BACKGROUND
A motor vehicle was impounded pursuant to section 55.1 of the Act and the impoundment was appealed by the owner. The owner, motor vehicle, and date of appeal in this matter are as follows:
Owner: The Applicant
Motor Vehicle: 2013 CHEV EQU (the “vehicle”)
Date of Appeal: August 29, 2012
All documents were entered into evidence as exhibits with the consent of both parties.
ISSUES
As set out in the Applicant’s request for hearing (Exhibit #1), the owner appeals on the basis that the vehicle owner exercised due diligence (i.e. all reasonable efforts) to determine that the driver's licence was not suspended as provided in section 50.2(3)(c) of the Act.
Should the Tribunal order the Registrar to release the motor vehicle on the basis that the owner of the motor vehicle exercised due diligence in attempting to determine that the driver’s licence of the driver of the motor vehicle at the time in respect of which the vehicle was detained in order to be impounded was not then under suspension?
FACTS
Evidence for the Applicant
A summary of the Applicant’s evidence follows.
The Applicant’s written submission filed with the Tribunal in support of the appeal was entered as Exhibit #1. The owner of the impounded vehicle is a corporation. In a typewritten note, dated August 27, 2012, the Applicant’s Agent pleads for the return of the vehicle on the ground when the vehicle was rented to the suspended driver he was in possession of a driver’s licence with an expiry date of “August 6, 2013”.
During the hearing, the Applicant’s Agent, testifying as a witness, reiterated the comments in the Notice of Appeal, noting that at the time of rental, a licence was actually seen, it appeared valid and not forged, and it showed an expiry date of August 6, 2013.
According to the witness, the Applicant followed procedure, actually asking to see the licence; the company no longer takes photocopies of licences for privacy reasons.
In cross-examination, the Applicant’s Agent confirmed the number of branches owned by the Applicant and explained that these branches are not franchises but rather owned and operated by the company.
The Applicant’s Agent confirmed the policy is to ask for the driver’s licence. The Applicant’s Agent admitted to being surprised by the possibility of someone having a driver’s licence in their possession when they were, in fact, suspended. According to the Applicant’s Agent, it is not conceivable that the licence would not be taken from a suspended driver.
The Applicant’s Agent affirmed that he is aware of a number that may be called to obtain verification of driver’s licence, but asserted that it would be unduly costly for the company to absorb the cost or to pass it on to their customers.
According to the Applicant’s Agent, the 800 number is used in cases of suspected fraud, if the licence appears fraudulent.
In reviewing the evidence presented by the Registrar the Tribunal pointed out that the suspended driver had previously been stopped and charged with driving under suspension. The Registrar’s Agent explained that the police officers are not always able to confiscate the licences, particularly when the driver suggests that they do not have it in their possession.
Evidence for the Registrar
A summary of the Registrar’s evidence follows.
The documents tendered by the Registrar and admitted into the record on consent of the Applicant were as follows:
Copy of the Ministry of Transportation records indicating that, among other things, the impounded motor vehicle is registered in the name of the Applicant as owner;
A copy of the notice prepared by the officer who detained the impounded motor vehicle indicating, among other things, that the vehicle at the time it was detained was being driven by the person convicted of the offence under the Criminal Code of Canada outlined in point 4 below;
Copy of the Notice forwarded to the Registrar of Motor Vehicles regarding the impoundment;
Copy of the Ministry of Transportation records indicating that the driver at the time of impoundment had been convicted of Driving While Disqualified under the Criminal Code of Canada pursuant to which the driver’s licence of the driver was then under suspension until July 18, 2013.
The Registrar called no other evidence.
LAW
Section 55.1 of the Act provides that a motor vehicle may be detained and impounded, and section 50.2 provides the motor vehicle owner’s right of appeal to the Tribunal. The Tribunal on the appeal may, pursuant to subsection 50.2(5) of the Act, confirm the impoundment or order the Registrar to release the motor vehicle. Pursuant to subsection 50.2(8), the decision of the Tribunal is, final and binding.
Subsection 55.1(3) of the Act states:
(3) A motor vehicle detained under subsection (1) shall be impounded as follows:
For 45 days, if there has not been any previous impoundment under this section, within a prescribed period, with respect to any motor vehicle then owned by the owner of the vehicle currently being impounded.
For 90 days, if there has been one previous impoundment under this section, within a prescribed period, with respect to any motor vehicle then owned by the owner of the vehicle currently being impounded.
For 180 days, if there have been two or more previous impoundments under this section, within a prescribed period, with respect to any motor vehicle then owned by the owner of the vehicle currently being impounded.
Regulation 631/98 provides that the prescribed period, referred to above, is two years.
The owner may appeal the impoundment on only four specific grounds set out in subsection 50.2(3):
(3) The only grounds on which an owner may appeal under subsection (1) and the only grounds on which the Tribunal may order the Registrar to release the motor vehicle are,
(a) that the motor vehicle that is impounded was stolen at the time it was detained in order to be impounded;
(b) that the driver’s licence of the driver of the motor vehicle at the time it was detained in order to be impounded was not then under suspension;
(c) that the owner of the motor vehicle exercised due diligence in attempting to determine that the driver’s licence of the driver of the motor vehicle at the time it was detained in order to be impounded was not then under suspension; or
(d) that the impoundment will result in exceptional hardship.
The Applicant here appeals on the basis of sections 50.2(3) (c).
The Shorter Oxford Dictionary, 3rd ed. provides the definition of “due diligence” as follows:
Due: A. adj. 1. That is owing or payable, as a debt. 2. Belonging or falling to by right. 3. That ought to be given or rendered; merited. 4. Such as ought to be; fitting; proper; rightful. 5. Such as is requisite or necessary; adequate. 6. To be ascribed or attributed; owing to, caused by, in consequence of. 7. Under engagement or contract to be ready or arrive (at a defined time).
Diligence: 1. The quality of being diligent; industry, assiduity. 2. Speed, dispatch. 3. Careful attention, heedfulness, caution. 4. Law. The attention and care due from a person in a given situation....
Also, “due diligence” in Black’s Law Dictionary (sixth edition) at page 457 is defined as follows:
Due diligence: Such a measure of prudence, activity, or assiduity, as is properly to be expected from, and ordinarily exercised by, a reasonable and prudent man under the particular circumstances; not measured by any absolute standard, but depending on the relative facts of the special case.
APPLICATION OF LAW TO FACTS
In closing, the Applicant ‘s Agent stated that it is agreed the suspended driver should not be driving, yet punishing the Applicant for his misdeed is not going to have any affect on him or stop him from getting into another vehicle. Further, individuals like him have no money and will never pay the impoundment fees, thus all costs are borne by the company. The only businesses benefitting are the towing companies and the impound facilities.
The Registrar’s Agent noted that the Applicant appealed on due diligence, which requires that all reasonable efforts be made to ensure the validity of a driver’s licence.
According to the Registrar’s Agent, simply looking at a driver’s licence is not enough. The Ministry is of the opinion that a higher standard is expected from companies that are in the business of renting vehicles to the public. According to the Registrar’s Agent, the cost of verification of licence validity with the Ministry is minimal and therefore it is expected that businesses will comply with the requirements.
The onus is on the Applicant to establish due diligence, as grounds of appeal.
Legislation requires that owners of motor vehicles try to determine whether or not the licence of the person who is to drive the owner’s car has a valid licence. Section 50.2(3)(c) of the Highway Traffic Act prescribes:
“…(c) that the owner of the motor vehicle exercised due diligence in attempting to determine that the driver’s licence of the driver of the motor vehicle at the time in respect of which the order was made was not then under suspension…”.
The Courts have held that to rely on a defence of due diligence, an Applicant must demonstrate that reasonable steps were taken to ensure the validity of an individual’s driver’s licence prior to allowing that individual to drive. In the case of a corporation, the issue is whether those who are the directing mind and will of the corporation exercised the due diligence.
Black’s Law Dictionary (sixth edition) at page 457, defines due diligence as follows:
“Such a measure of prudence, activity, or assiduity, as is properly to be expected from, and ordinarily exercised by, a reasonable and prudent man under the particular circumstances; not measured by any absolute standard, but depending on the relative facts of the special case.”
The issue revolves around the question of what is considered “reasonable and prudent”.
The Ministry argues that its “policy” requires driver’s licence verification with the Ministry, either on line or by means of a phone call. The Tribunal notes that this is a policy only and not contained within the Act or regulations. Thus, it is the Tribunal’s finding that the need to contact the Ministry is above and beyond what would be deemed reasonable.
In this matter, the Tribunal is satisfied that the Applicant has adopted a prudent method of verification by requiring staff to view the driver’s licence of every individual seeking to rent a vehicle. The Tribunal accepts the evidence, that although the company does not have a photocopy of the driver’s licence at issue, the staff did in fact follow procedure. This premise is corroborated by the fact that the expiry date was noted as August 6, 2013.
Given the evidence, the Tribunal concludes that the Applicant meets the standard of section 50.2(3)(c) of the Act.
DECISION
After considering the evidence, pursuant to the authority vested in the Tribunal under section 50.2(5) of the Act, the Tribunal orders the Registrar to release the motor vehicle.
LICENCE APPEAL TRIBUNAL
Antoine Aouad, M.D., Presiding Member
RELEASED: September 24, 2012