Licence Tribunal
Appeal d'appel en
Tribunal matière de permis
DATE:
2013-11-27
FILE:
8229/LLA
CASE NAME:
8229 v. Registrar of Alcohol and Gaming
Appeal from the Notice of Proposal of the Registrar of Alcohol and Gaming under the Liquor Licence Act, R.S.O. 1990, c. L. 19 – to Refuse the Application for Licence
Ce Ce Mug Bar and Grill Inc.
Applicant
-and-
Registrar of Alcohol and Gaming
Respondent
DECISION AND ORDER
ADJUDICATOR:
Jacqueline Castel, Member
APPEARANCES:
For the Applicant:
Joseph W. Irving, Counsel
For the Respondent:
Philip Morris, Counsel
Heard in Toronto:
November 15, 2013
DECISION AND ORDER
BACKGROUND
The Registrar of Alcohol and Gaming (the “Registrar”) under the Liquor Licence Act, (the “Act”) issued a Notice of Proposal, dated June 9, 2013, which proposed to refuse the Application for Licence of Ce Ce Mug Bar & Grill Inc. (the “Applicant”), operating as Ce Ce Mug Bar & Grill (the “establishment”). The Applicant appealed this Notice of Proposal to the Licence Appeal Tribunal.
THE EVIDENCE
The Notice of Proposal to Refuse and the Notice of Appeal were entered as Exhibits 1 and 2, respectively. Mr. Morris filed the following documents, which were entered as exhibits and numbered as follows:
Exhibit 3: Will Say of Constable Clay Martin
Exhibit 4: Ross Bar & Grill (Re) [2001] O.A.G.C.D. No 373
Exhibit 5: Ross Bar & Grill (Re) [2003] O.A.G.C.D. No. 396
Exhibit 6: Ross Bar & Grill (Re) [2005] O.A.G.C.D. No. 184
Exhibit 7: Ross Bar & Grill (Re) [2006] O.A.G.C.D. No 239
Exhibit 8: Ross Bar & Grill (Re) [2007] O.A.G.C.D. No 173
Exhibit 9: Ross Bar & Grill (Re) [2007] O.A.G.C.D. No. 255
Ontario Provincial Police Constable (“Const.”) Clay Martin, who has been employed in the Inspection and Investigations Branch of the Alcohol and Gaming Commission of Ontario (“AGCO”) since 2008, testified that he investigated the application of Ce Ce Mug Bar and Grill, which involved interviewing Mr. Nadesan Raveendran, the sole officer and director of the corporate applicant.
Const. Martin stated that Mr. Raveendran was the manager of Ross Bar and Grill between 2001 and 2007 and his wife was the principal or licence holder. He summarized Exhibits 4 through 9, which were decisions of the Board of the AGCO (the “Board”) regarding Ross Bar & Grill.
The Board suspended Ross Bar & Grill’s liquor licence for 7 days in 2001 (Exhibit 4), for 21 days in 2003 (Exhibit 5), for 35 days in 2005 (Exhibit 6), and for 45 days in 2006 (Exhibit 7). All four suspensions were for permitting drunkenness, in contravention of subsection 45(1) of Ontario Regulation 719/90, and three of the suspensions were also for permitting the removal of liquor from the licensed premises, in contravention of subsection 34(1) of Ontario Regulation 719/90.
On April 30, 2007, the Board found that Ross Bar and Grill breached subsection 45(2) of Ontario Regulation 719/90, by permitting a drug transaction to take place in the establishment (Exhibit 8). As a result of this contravention and Ross Bar and Grill’s history of non-compliance, the Board revoked the licence on May 22, 2007 (Exhibit 9).
Const. Martin stated that an unrelated person held the liquor licence at the premises where Ross Bar and Grill was located between January 31, 2008 and February 8, 2010. Since this time, the premises has been vacant. Ce Ce Mug Bar & Grill would be located at this premises. Const. Martin advised that there are significant problems with drugs, gangs and prostitution in the neighbourhood of the establishment.
Const. Martin informed that he interviewed Mr. Raveendran on April 2, 2013. At this time, Mr. Raveendran told him that he owed $2,235 to Enbridge Gas, $3,818 to Toronto Hydro, and $6,100 in property taxes to the City of Toronto. He also told him that he earns $700 a month in rent from tenants living in apartment above the establishment. Further, Mr. Raveendran informed him that he secured three cash loans from Cashpoint Incorporated, totalling $6750, by pawning jewellery for the start up of the establishment.
On cross-examination, Const. Martin admitted that Mr. Raveendran was cooperative and forthcoming at the interview of April 2, 2013.
Mr. Morris filed the Will Say of Ms Rebecca Castillo, the AGCO Manager of Liquor Eligibility, which the Tribunal entered as Exhibit 17. Ms Castillo testified that given the disciplinary history of the Ross Bar and Grill, culminating in the revocation of its license in 2007, and given that Mr. Raveendran managed the Ross Bar and Grill, she does not believe that the business of the Applicant would be carried out in accordance with the law and with honesty and integrity. She did not see anything on Mr. Raveendran’s resume to indicate that he has acquired additional experience running a licensed established since the revocation of Ross Bar and Grill’s licence. According to his resume, he has not worked for a licensed establishment since 2007.
Ms Castillo stated that imposing conditions on the licence of the Applicant would not alleviate her concerns about this Applicant. Given the compliance history of Ross Bar and Grill, she does not believe the Applicant would comply with terms and conditions.
Mr. Irving filed the Will Say of Mr. Raveendran which the Tribunal entered as Exhibit 11. Mr. Raveendran testified that his wife held the liquor licence for Ross Bar and Grill and he was out of the country for some of the time during which she held the licence. On cross-examination, he clarified that he was out of the country for two months in 2003.
Mr. Raveendran stated that he has suffered considerable economic hardship since Ross Bar and Grill’s liquor licence was revoked and that he will not be able to pay the mortgages on the property if he is not granted a liquor licence. He stated that he has two mortgages on the establishment, one for $200,000 and the other for $150,000. He indicated that his debts have increased since he was interviewed by Const. Martin. He currently owes $4,000 to Enbridge, $6,000 to Toronto Hydro and $14,000 in property taxes. He has also borrowed another $50,000 from family and friends which he needs to repay.
Mr. Raveendran stated that currently his only source of income is $700 per month from a tenant. He estimated that if the establishment was granted a licence, the monthly sales would be $10,000 per month, but he did not provide particulars as to how he arrived at this number.
Mr. Raveendran stated that he would be willing to have the following conditions attached to the Applicant’s licence:
his wife would not be allowed on the premises or to have any involvement in the operation or ownership of the establishment;
8 video cameras would be used to monitor activities within the public areas of the establishment and signage would be posted cautioning patrons about the video cameras;
the recordings from these cameras would be stored for 30 days;
there would be a minimum of 3 staff members;
a security officer would be posted at the entrance to the establishment between 10 p.m. and 12 a.m.;
the establishment would close at midnight; and
any infractions under the Act or any municipal by-law would be immediately reported to the AGCO.
He assured the Tribunal that he would comply with the terms and conditions, if given a chance, notwithstanding the cost associated with some of the conditions.
THE LAW
Subsection 6(2) of the Liquor Licence Act provides that “an applicant is entitled to be issued a licence to sell liquor except if”,
“(d) the past or present conduct of the persons referred to in subsection (3) affords reasonable grounds for belief that the applicant will not carry on business in accordance with the law and with integrity and honesty;”
Subsection 6(3) states that clause 6(2)(d) applies to the following persons :
The applicant.
An officer or director of the applicant.
A person who is interested in another person, as described in subsection 1(2).
A person having responsibility for the management or operation of the business of the applicant.
ISSUE
Does the past or present conduct of the Applicant or Mr. Raveendran afford reasonable grounds for the belief that the Applicant or Mr. Raveendran will not carry on business in accordance with the law and with integrity and honesty?
REASONS AND ANALYSIS
Mr. Raveendran is the sole officer and director of the corporate Applicant. He was also the manager of Ross Bar and Grill between 2001 and 2007.
Ross Bar and Grill had a deplorable record for compliance with the Act and regulations. Between 2001 and 2006, Ross Bar and Grill had its licence suspended four times for contraventions of the Act and regulations, the last suspension lasting for 45 days. In 2007 it was found to have permitted a drug transaction to take place in the licensed premises, which ultimately led to the revocation of its licence. As the manager of the Ross Bar and Grill between 2001 and 2007, Mr. Raveendran was responsible, along with his wife who was the principal on that licence, for its compliance record and failure to implement corrective measures to address the compliance problems.
Mr. Irving asked the Tribunal to infer from the financial hardship Mr. Raveendran
has experienced since the reovocation of Ross Bar and Grill’s licence that he has learned his lesson and will operate the new establishment with increased vigilance. He argued that this increased vigilance, along with conditions pertaining to video cameras, minimum staffing levels, security and hours of operation, should address the concerns pertaining to illegal activity.
The Tribunal found Mr. Raveendran to be forthright in his testimony and was sympathetic to his financial troubles. However, the test under clause 6(2)(d) is whether the Applicant’s past or present conduct affords reasonable grounds to believe that the business will not be conducted in accordance with the law and with honesty and integrity. As such, future intentions, however sincere they may be, have little relevance under clause 6(2)(d) and cannot override the numerous, serious contraventions which occurred at Ross Bar and Grill while Mr. Raveendran was the manager.
Actions speak louder than words, and Mr. Raveendran could offer only verbal assurances. No evidence was introduced to suggest that Mr. Raveendran’s actions since 2007 would make him a more “effective” manager in 2013 or, more specifically, a manager who is equipped to ensure compliance with the Act and regulations, in a neighbourhood known to have significant challenges with drugs, gangs and prostitution. Mr. Raveendran did not point to any work experience, training or other experience he may have acquired since 2007 which would make him better equipped in this regard. In fact, Mr. Raveendran has not worked at a licensed premises since 2007 when Ross Bar and Grill’s license was revoked.
The Tribunal agrees with Ms Castillo that conditions attached to a licence are only effective if the licensee complies with them. The Applicant’s past conduct and failure to learn from his mistakes while managing Ross Bar and Grill, despite being afforded many chances through progressive discipline, does not provide the necessary assurance that the Applicant would comply with conditions, if imposed.
In light of the compliance history of Ross Bar and Grill while Mr. Raveendran was the manager and his failure to provide any evidence that he would be more effective in ensuring compliance with the Act and regulations today, the Tribunal finds, pursuant to clause 6(2) of the Act, that the past conduct of the Applicant affords reasonable grounds for the belief that the Applicant will not carry on business in accordance with the law and with integrity and honesty.
ORDER
Pursuant to the authority vested in it under the provisions of the Act, the Tribunal directs the Registrar to carry out the Proposal refusing to issue a licence to the Applicant.
LICENCE APPEAL TRIBUNAL
_________________________
Jacqueline Castel, Vice-Chair
Released: November 27, 2013