Platinum Auto Gallery Inc. v. Registrar, Motor Vehicle Dealers Act, 2002, 2013 CanLII 41659

Licence Appeal Tribunal

Appeal d'appel en Tribunal matière de permis

DATE: 2013-06-28

FILE: 8099/MVDA

CASE NAME: 8099 v. Registrar, Motor Vehicle Dealers Act, 2002

Appeal from a Proposal of the Registrar under The Motor Vehicle Dealers Act, 2002 S.O. 2002, C. 30, Sch. B to Refuse a Registration and to Revoke a Registration

Platinum Auto Gallery Inc. Behzad Rabie and Jamie Giroux Applicants

-and-

Registrar, Motor Vehicle Dealers Act, 2002 Respondent

DECISION ON MOTION

ADJUDICATOR: D. Gregory Flude, Vice-Chair

APPEARANCES:

For the Applicants: Symon Zucker, Counsel

For the Respondent: Brian Osler, Counsel

Heard by Teleconference: June 10, 2013

Reasons for Decision – Motion for Interim Registration

1The Applicants bring this motion before the Licence Appeal Tribunal for an order permitting them to carry on business pending a hearing into the Registrar’s refusal to register Platinum Auto Gallery Inc. and Behzad Rabie as a dealer under the Motor Vehicle Dealers Act, 2002, S.O. 2002, C. 30, Sch. B (the “Act”) and to revoke the registration of Jamie Giroux. At issue in this motion is Tribunal’s jurisdiction to make an interim order that, in pith and substance, would have the effect of converting the Registrar’s Notice of Proposal to Refuse Registration to a Notice of Proposal to Revoke Registration with respect to the registration of Platinum and Behzad Rabie.

2The Act sets out a mechanism whereby the Registrar can move to either exclude new applicants from entering the car dealership business or revoke the registrations of persons already registered. For the purposes of this motion, the key difference between the two actions, refusal or revocation, is that a person already registered has the right to carry on business until the conclusion of an appeal to this Tribunal and the release of the Tribunal’s final order. Unregistered applicants are denied participation in the industry until the Tribunal issues an order in their favour. The statutory scheme is set out in s. 9 of the Act and the applicable sections are as follows:

9. (1) The registrar shall notify an applicant or registrant in writing if he or she proposes to,

(a) refuse under subsection 8 (1) to grant or renew a registration;

(b) suspend or revoke a registration

Content of notice

(2) The notice of proposal shall set out the reasons for the proposed action and shall state that the applicant or registrant is entitled to a hearing by the Tribunal if the applicant or registrant mails or delivers, within 15 days after service of the notice, a written request for a hearing to the registrar and to the Tribunal.

Hearing

(5) If a hearing is requested, the Tribunal shall hold the hearing and may by order direct the registrar to carry out the registrar’s proposal or substitute its opinion for that of the registrar and the Tribunal may attach conditions to its order or to a registration

Continuation pending renewal

(8) If, within the time prescribed or, if no time is prescribed, before the expiry of the registrant’s registration, the registrant has applied for renewal of a registration and paid the required fee, the registration shall be deemed to continue, [emphasis added]

(c) if the registrant is served notice that the registrar proposes to refuse under subsection 8 (1) to grant the renewal, until the time for requesting a hearing has expired or, if a hearing is requested, until the Tribunal makes its order.

3While the facts are somewhat sympathetic to the Applicants, it is admitted that Platinum and Rabie filed for renewal of their registration after the expiry of their previous registration. The wording of s. 9 (8) does not provide for the automatic statutory extension of the Applicants’ registrations until the Tribunal issues its order. The question before the Tribunal on this motion asks if the Tribunal has jurisdiction to make an order akin to s. 9 (8) and permit the Applicants to carry on business pending a final order.

4The renewal for Platinum and Rabie was due on April 27, 2013. Since that day was a Saturday, by virtue of s. 89(2) of the Legislation Act, 2006 S.O. 2006, Chap. 21 Schedule F, the effective date for filing was Monday, April 29, 2013. The Applicants filed on May 1, 2013, the second day after the expiry of their registration. According to the affidavit evidence filed on the motion, Mr. Rabie was in the process of applying to open a second location. In and around mid-April he was called out of the country to attend his seriously ill brother. He returned from that visit in the last week of April and, on Monday, April 29 he realized that he had not filed his renewal. He immediately contacted the Ontario Motor Vehicle Industry Council (“OMVIC”), the office of the Registrar under the Act, and explained his problem. He was advised to get his renewal application in as soon as possible, which he did on May 1. The irony is that if he had attended OMVIC’s office on April 29 his application would have been received in a timely manner and this motion would have been unnecessary.

5While the Applicants argue that “during his interactions with OMVIC Ben [Mr. Rabie] was not reminded that his dealership licence and his sales licence needed to be renewed,” and “OMVIC further did not provide the necessary renewal forms which were usually given to Ben,”(Affidavit of Sumit Tangri, paras. 7 and 9.) Ms McBean, in her affidavit, outlines OMVIC’s dealings with the Applicants including providing a copy of the renewal notice sent about two months before expiry identifying the expiry date and the consequences of a failure to act.(Affidavit of Yovanka McBean para 4 and Ex. A). Given the fact that the Applicants have been in business since 2005 and have renewed annually since 2006, the Tribunal finds the attempt to blame OMVIC for the Applicants’ failure to file in a timely manner to be disingenuous.

6The Tribunal accepts the Applicants’ position that the inability to carry on its business pending the outcome of the hearing is likely to create a “significant financial burden,” not only to the Applicants but to staff who will have been laid off pending the resolution of the issues(Tangri Affidavit para 17). It also notes that the affidavit does not allege irreparable harm.

7The Applicants submit that the Tribunal has jurisdiction to issue an interim order licensing the Applicants pending the hearing. It is their position that a combination of statutory interpretation, natural justice and common law combine to bathe the Tribunal with authority to issue an interim order. The starting point for the Applicants’ submissions is s. 16.1 of the Statutory Powers Procedure Act, R. S. O. 1990 c. s 22 (“SPPA”) which states:

16.1(1) A tribunal may make interim decisions and orders.

23. (1) A tribunal may make such orders or give such directions in proceedings before it as it considers proper to prevent abuse of its processes.

Further, the Licence Appeal Tribunal Act, 1999, S.O. 1999, chap. 12 Schedule G provides:

Duties and powers

3. (1) The Tribunal shall hold the hearings and perform the other duties that are assigned to it by or under any Act or regulation.

Powers

(2) Except as limited by this Act, the Tribunal has all the powers that are necessary or expedient for carrying out its duties.

8According to the Applicants, the failure of OMVIC to deal with their applications as renewal applications is both a denial of natural justice and an abuse of process. They cite the Ontario Superior Court of Justice decision of Justice Nordheimer in Gala Homes Inc. v. Flisar et al 2000 CanLII 29059 (ON SC), 48 O.R. (3d) 470 [2000] O.J. No. 1694. That case dealt with a collateral attack by the plaintiff of a decision by Tarion Warranty Corporation to warrant defects in construction in new homes owned by the defendants. In granting the defendants motion for summary judgment, Nordheimer J. cites with approval Lord Justice Stuart-Smith’s comments in House of Spring Garden Ltd. v. Waite [1990] 3. W. L. R. 347, [1990] 2 All E.R. 990 (C.A.) that courts have inherent power to prevent misuse of their process. While it may be arguable that the Tribunal does not have inherent power, it does have the authority to control its own process and prevent abuse of process as set out in s. 23 (1) of the SPPA. As stated by Vice-Chair Sweeney in 5319-ONHWPA-Claim, [2009] O.L.A.T.D. No. 363 at para 11:

Within the bounds of its governing statute and the rules of natural justice, a tribunal, such as this one, can do all acts and things and has all the powers to do what is necessary to conduct a hearing so that justice might be done.

9The Applicants also rely on decision of Vice-Chair Diamond in Rooymans [2006] O.L.A.T.D. No. 402. Mr. Rooymans had filed for renewal of his registration approximately three and a half weeks late. As with the current case, the Registrar treated the matter as a refusal to register rather than as a revocation of registration. At issue was the question whether Mr. Rooymans should be judged on the standard applicable to an existing registrant or on a standard applicable to a new registrant. In Coates v. Ontario (Registrar of Motor Vehicle Dealers and Salesmen) 1988 CanLII 4555 (ON HCJ), [1988] O.J. No. 1351, 65 O.R. (2d) 526, 52 D.L.R. (4th) 272, 28 O.A.C. 307, 34 Admin L.R. 70, 11 A.C.W.S. (3d) 402, the Divisional Court held:

In revoking a registration the tribunal is interfering with a right to make a living that has been equated to a property right: see Evans, Janisch, Mullan and Risk, Administrative Law, (2nd ed. (Toronto, Edmond-Montgomery Publications, 1984) at p. 80. While the grant or refusal of a licence may be regulated as a matter of privilege, rather than right, the revocation of an existing licence has always been regarded as a right, not a privilege.

Mr. Diamond cited the above passage and determined that, in considering Mr. Rooymans’ appeal, he would deal with it as a revocation not as a new application. The Applicants submit that Mr. Diamond’s reasoning applies in this case and that the Tribunal should treat the Applicants appeal as an appeal from a revocation and permit them to carry on business until the Tribunal releases its order.

10The difficulty for the Applicants is that to succeed they need to elevate the clear scheme of the Act for the renewal of registration and the consequences that arise from late filing into an abuse of process and a denial of natural justice. The Tribunal cannot conclude that there has been a denial of natural justice nor is the Registrar’s position an abuse of process. Notwithstanding the sympathetic facts, the Applicants were notified about their renewal two months prior to the expiry of their registration. It appears that they chose not to address the renewal issue promptly but left it until the last minute. Having been involved in renewing their registration annually between 2006 and 2012, the Tribunal is not moved by claims that they thought everything was in hand because they were seeking to open at another location.

11Nor does Rooymans assist the Applicants. Rooymans is a standard of proof case. It holds that behaviour that may be sufficient to bar entry to a regulated industry will be examined more closely when the issue is removal from a regulated industry. It does not address the ability of the Tribunal to grant interim registration in the face of clear statutory language to the contrary. Indeed, applying the words of Vice-Chair Sweeney, the Tribunal is constrained by its governing statutes that include the Act, the SPPA and its own constituting statute. Rights granted in those statutes go to the power of the Tribunal to control its own process. They do not grant the Tribunal the ability to vary the originating process substantively by changing the Notice of Proposal to Refuse Registration from which the Tribunal’s right to proceed flows, to such a degree that it becomes another document all together, a Notice of Proposal to Revoke Registration, a document having its own panoply of rights.

12Having considered the affidavit evidence and the submissions of the Parties, the Tribunal denies the Applicants motion for interim registration pending the hearing of the Appeal. A pre-hearing conference is scheduled for July 11, 2013. The Applicant may seek an expedited hearing from the member chairing that conference to mitigate any damage currently being incurred. That decision resides solely with the member at the pre-hearing conference.