Licence Tribunal
Appeal d'appel en Tribunal matière de permis
FILE: 8576/LLA
CASE NAME: 8576 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 an Application for a Licence
Giuseppe (Joe) Merlo operating or intending to operate as Nino Italian Restaurant Appellant
-and-
Registrar of Alcohol and Gaming Respondent
REASONS FOR DECISION AND ORDER
ADJUDICATOR: Geneviève Blais, Member
APPEARANCES:
For the Appellant: No one appeared
For the Respondent: Phillip Morris, Counsel
Heard in Ottawa: October 14, 2014.
REASONS FOR 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 January 8, 2014, which proposed to refuse an application for a licence. Giuseppe (Joe) Merlo operating or intending to operate as Nino Italian Restaurant (the "Appellant") appealed this Notice of Proposal to the Licence Appeal Tribunal.
PRELIMINARY ISSUES
The Tribunal convened at the time, date and location specified on the Pre-Hearing Order dated June 18, 2014. However, neither the Appellant nor a representative was present. The Tribunal adjourned until 10:00 a.m. to give the Appellant additional time to attend the hearing. The hearing resumed and neither the Appellant nor a representative was in attendance.
Three days prior to the hearing, Counsel of record advised the Tribunal that he had been unsuccessful in contacting the Appellant over the past month. As there had been a breakdown in communication, he notified the Tribunal he was withdrawing from the case. Subsequent attempts by the staff of the Tribunal to contact the Appellant by telephone were equally unsuccessful and the Appellant did not contact the Tribunal to provide any reason for his absence from this hearing.
Mr. Morris requested that the hearing proceed ex parte on the grounds that the matter has been subject to three pre-hearings. The Appellant received advance notice of more than three months for this hearing and all attempts to contact the Appellant had been to no avail. Based on these grounds, the Tribunal agreed to proceed ex parte.
EVIDENCE
Police Constable (“P.C”) Shane Stroughair of the Ottawa Police Services testified that in early August, 2013, Inspector Mark Daniels of the Alcohol and Gaming Commission of Ontario (“AGCO”) contacted the local police office and advised that the Appellant, operating as Nino Italian Restaurant, was selling liquor without a licence and had been warned on two occasions to cease this practice.
On August 15, 2013, at approximately 7:00 p.m., PC Stroughair attended Nino Italian Restaurant and witnessed wine on one table and a bartender operating a fully stocked bar. The Appellant, who identified himself as the owner, acknowledged he did not have a liquor licence and told PC Stroughair that he was operating with a Special Occasion Permit (“SOP”). He was unable to produce the SOP. He claimed he may have left it at his residence. PC Stroughair ordered the Appellant to remove all the alcohol from the premises and allowed him to put it in his vehicle. PC Stroughair recognized the vehicle from a previous traffic violation investigation involving the Appellant, who was registered as a suspended driver. He cautioned the Appellant about driving while suspended. The Appellant responded by saying, ”he would never do that” and stated that his girlfriend drove him around.
PC Stroughair established through Mr. Daniels, AGCO inspector, that the Appellant was never issued an SOP for August 15, 2013. As a result, the Appellant was issued a violation for the occurrence and was warned that further spot checks of his restaurant would be made by the Ottawa Police Services.
On August 29, 2013, PC Stroughair on a routine patrol in the vicinity of Nino Italian Restaurant, witnessed the Appellant driving his vehicle from a grocery parking area. He stopped the vehicle. The Appellant was unable to produce his licence and claimed his licence had been reissued.
PC Martin Riopelle assisted in the August 29, 2013 occurrence and he testified that the Ministry of Transportation (“MTO”) records showed the Appellant was a suspended driver for unpaid fines. Accordingly, the Appellant was charged with a Highway Traffic Act (HTA) violation and his vehicle was towed.
PC Christine Schulz of the Ottawa Police Services testified that on March 14, 2014, she stopped the Appellant driving his vehicle. The Appellant claimed he had paid off his fines and his licence was no longer under suspension. However, he was unable to produce a temporary permit or any proof of payment. MTO records confirmed the Appellant was a suspended driver and he was charged under the HTA.
Mark Daniels testified he has been an Inspector with the AGCO for six years. In July, 2013, he received a complaint from the manager of the area liquor store who reported that the Appellant was repeatedly requesting SOPs. The manager had cautioned the Appellant about this practice and advised him it was an unacceptable means of selling liquor in his restaurant.
On July 25, 2013, Inspector Daniels attended Nino Italian Restaurant to investigate the complaint. He witnessed patrons consuming alcohol and a bar in full operation. He interviewed the Appellant who admitted he did not have a licence or an SOP for the occasion. He claimed his liquor licence application was taking too long and he was unable to make ends meet and properly support his family. Inspector Daniels ordered the Appellant to stop selling alcohol without a licence and the Appellant agreed to cease this practice. Inspector Daniels warned him that this illegal activity could further delay his application and he could also be charged under the Act.
On August 13, 2013, Inspector Daniels testified he conducted a spot check at Nino Italian Restaurant and once again witnessed patrons in the restaurant who had been served alcohol. The Appellant had no SOP and was issued a second warning. Inspector Daniels contacted the Ontario Provincial Police to further investigate the matter. In concluding his testimony, he stated that the Appellant seemed to have a total disregard for the liquor laws.
Detective Lester Nichols has been with the AGCO Ontario Provincial Police unit for five years. He investigated the Appellant’s application for a liquor licence and reported that the application contained several false and misleading statements. He testified that the Appellant was found to be operating his business without a city occupancy permit. The Appellant had convictions for unlawfully selling liquor, driving while under suspension and fraud. The investigation further revealed a disturbing financial history and low income. In 2013, the Appellant received an order of discharge from his 2010 bankruptcy.. He has unpaid fines and an outstanding default judgement which total approximately $42,037.
SUBMISSIONS
Mr. Morris submitted that the evidence provided by the police officers, the AGCO Inspector and the OPP investigator is clear. He asked the Tribunal to uphold the Notice of Proposal and to refuse the application for a licence made by the Appellant.
The Appellant operated a business without a licence and despite several warnings he continued the pattern of operating illegally. In the past two years, he was convicted of provincial and criminal offences. He provided false and misleading information on the licence application and has shown minimal intention of complying with the law. His past and current financial position is troubling. His past and present conduct gives ample reason for the Tribunal to conclude that the Appellant would not carry on its business in accordance with the law and with integrity and honesty.
THE LAW
The Act provides, in part, as follows:
- (1) A person may apply to the Registrar for a licence to sell liquor
(2) Subject to subsection (4) or (4.1), an applicant is entitled to be issued a licence to sell liquor except if,
(a) having regard to the applicant’s financial position, the applicant cannot reasonably be expected to be financially responsible in the conduct of the applicant’s business;
(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;
(e) the applicant or an employee or agent of the applicant makes a false statement or provides false information in an application under this Act;
(f) the applicant is carrying on activities that are, or will be, if the applicant is licensed, in contravention of this Act or the regulations;
ISSUES
The question for the Tribunal is
(1) Whether the Appellant’s financial position is such that it cannot reasonably be expected to be financially responsible in the conduct of its business; and/or
(2) Whether the past or present conduct of the Appellant affords reasonable grounds to believe the Applicant will not carry on its business in accordance with the law and with integrity and honesty; and/or
(3) Whether the Appellant made a false statement in the application; and/or
(4) Whether the Appellant is carrying on activities that are in contravention of the Act.
APPLICATION OF LAW TO FACTS
The Registrar’s witnesses provided clear and consistent evidence which was uncontested. The Appellant’s record of compliance with the law is less than desirable, with numerous and serious contraventions.
The facts demonstrate that the Appellant’s financial situation is weak and he has serious debt. There is no evidence before the Tribunal of any effort by the Appellant to address this financial responsibility. His inability to take responsibility includes his failure to provide the Tribunal with an explanation for the non-attendance at this hearing, despite filing the Notice of Appeal.
The Tribunal concludes from the above that the Appellant cannot reasonably be expected to be financially responsible in its business conduct.
Further, under the Act, a person who otherwise qualifies is entitled to a liquor licence unless there are reasonable grounds to believe that he will not conduct his business with honesty, integrity and in accordance with the law. The ability to operate in accordance with the law includes the ability to comply with the regulatory regime established under the Act.
The Appellant’s past conduct demonstrates he has carried on activities that are in contravention of the Act by selling liquor without a licence. He has made false statements in the application for a licence. These actions are sufficient to provide reasonable grounds to believe that the business will not be carried on in accordance with the law and with integrity and honesty as is required under the Act..
The Tribunal concludes that the Appellant is unable and/or unwilling to comply with the regulatory regime that is necessary to operate a licensed establishment in this province.
ORDER
Pursuant to the authority vested in it under the provisions of the Act, the Tribunal directs the Registrar to carry out the Proposal.
LICENCE APPEAL TRIBUNAL
Geneviève Blais, Member
Released: October 27, 2014