Licence Appeal Tribunal
Tribunal d'appel en matière de permis
FILE: 10501/MVIA
CASE NAME: 10501 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.
Pine Valley Holdings Ltd. Appellant
-and-
Registrar of Motor Vehicles Respondent
AMENDED REASONS FOR DECISION AND ORDER
ADJUDICATOR: Mary Ann Spencer, Member
APPEARANCES:
For the Appellant: Tobias Lee, Agent
For the Respondent: Sanjay Kapur, Agent
Heard by teleconference: November 9, 2016
AMENDED REASONS FOR DECISION
A hearing was held on November 9, 2016 by teleconference to consider the Appellant’s appeal pursuant to section 50.2 of the Highway Traffic Act, R.S.O., 1990, c. H.8 (the “HTA” or the “Act”).
Pursuant to section 50.2(5) the Tribunal CONFIRMS THE IMPOUNDMENT. As a result the Appellant’s motor vehicle will remain detained at the impound facility for 45 days.
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 Appellant
Motor Vehicle: 2001 CHEV SIL (the “vehicle”)
Date of Appeal: October 20, 2016
ISSUES
In the Appellant’s request for hearing (Exhibit #2), the owner appeals only 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 set out 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 Appellant
Tobias Lee, the Manager of Pine Valley Corporation, testified on behalf of the Appellant. The Appellant, Pine Valley Holdings Ltd., owns Pine Valley Corporation, which began operations in April 2015 as a seasonal landscaping business. As of October 2016, the company employed 44 people and operated 13 vehicles. The impounded vehicle, while registered to Pine Valley Holdings Ltd. is operated by Pine Valley Corporation.
Mr. Lee testified that on June 8, 2016, police contacted the company to inform them that an employee, who did not have a valid driver’s licence, had left a company vehicle abandoned on the side of the road. On June 13, 2016, in response to this incident, and to help manage its growing workforce, the company hired an office manager. On June 15, 2016, the company ordered driver record abstracts for all of its employees from the Ministry of Transportation (Exhibit 3). It was discovered that three of its drivers had suspended licences. Recognizing that the copies of driver’s licences it required its employees to submit were not reliable, the company instituted a policy that requires any employee who does not need to drive one of its vehicles or who does not possess a valid driver’s licence to sign a written acknowledgement that they are not authorized to operate any vehicles. The acknowledgement also states that they will be required to submit a copy of their driver’s licence and a driver’s abstract from the Ministry of Transportation before authorization to drive a company vehicle will be given.
C.N., the suspended driver in this case, was hired by the Appellant on August 29, 2016. Because he did not provide a driver’s licence to the company, he signed the written acknowledgement described above (Exhibit 3). On October 5, 2016, the company was advised that one of its vehicles had been impounded and C.N. had been arrested.
On October 5, 2016, C.N. was working with another employee, J.C., who was authorized to operate the company vehicle. J.C., who had been employed for a longer period of time than C.N., was considered the “team leader” although his position was not a supervisory one. Mr. Lee testified that after the vehicle was impounded, J.C. admitted that he had allowed the suspended driver to use the vehicle “in the heat of the moment”. J.C. believed that C.N. held a valid driver’s licence because he showed J.C. his licence and had driven a personal vehicle to the job site. Mr. Lee testified that his own suspicion is that J.C. asked the suspended driver to go to get coffee for them.
Mr. Lee testified that J.C. violated company policy. While the policy is not written, employees who are authorized to drive company vehicles are clearly told that only they may operate the vehicles. These drivers are not told about the status of their co-workers’ licences. In this case, only J.C. was authorized to drive, and he was not aware that his co-worker’s licence was suspended. Following the impoundment, the company issued a warning to J.C. and re-communicated its policy to all of its employees. It has been unable to contact C.N., who did not return to work after the impoundment.
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 Appellant 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 Appellant 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 under suspension for life.
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 appeal is being considered on the basis of sections 50.2(3)(c).
Issue 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?
“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.
In order to establish due diligence within the meaning of s. 50.2(3)(c) of the Act, the Appellant must show that it took all reasonable steps to determine that driver’s licence in question was not under suspension at the time of the impoundment.
APPLICATION OF LAW TO FACTS
The onus is on the Appellant to demonstrate that it exercised due diligence. The position of the Appellant is that the vehicle should be released on the basis that the company conducted due diligence; it has taken reasonable measures to ensure that the drivers of its vehicles have valid licences.
On behalf of the Registrar, Mr. Kapur submits that the wording in section 52.1(3)(c), “not then under suspension”, means that this due diligence provision only applies when the vehicle owner determines that the driver’s licence is valid, and it does not include doing what he described as “the reverse”; that is, determining that the licence is not valid and then forbidding the driver from using the vehicle.
Mr. Kapur also submits that the “philosophy” of the Tribunal’s August 2, 2016 reconsideration decision of 10149 v Registrar of Motor Vehicles, 2016 CanLII 50127 (ON LAT) (“Auto Zone”) can be applied to the ground of due diligence. He referred to the reconsideration decision’s finding that the Tribunal, in its original decision, made an error of law in broadening the meaning of “stolen” set out in section 50.2(3)(a) of the Act to include the use of property contrary to the owner’s instructions. Mr. Kapur argues that because the vehicle in the current case was also operated contrary to the owner’s instructions, the Tribunal should conclude that the vehicle “does not merit release” and therefore the Tribunal should not set aside the impoundment. The Tribunal notes that the reconsideration case concerned the ground of “stolen” and it does not apply to the ground of “due diligence”.
Section 50.2(3)(c) states that the owner may appeal on the ground 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”. The defence of due diligence is available when a vehicle owner, having made efforts to establish a driver has a valid licence, allows that driver the use of a vehicle and later discovers that the driver’s licence was in fact suspended. The “due diligence” set out in the legislation is the attempt to determine that the driver to whom control of a vehicle is given has a valid licence. For example, if an individual asked to borrow a vehicle, the vehicle’s owner would have to make reasonable efforts to check the status of the individual’s licence before lending it in order to rely on a defence of due diligence if the vehicle was impounded later because the individual’s licence was suspended.
The employee whom the Appellant authorized to drive its vehicle was J.C. Had J.C. been the suspended driver in this case, the fact that the Appellant had recently reviewed J.C.’s driver’s abstract would have comprised the due diligence set out in the legislation; in June 2016, the company had ordered driver record abstracts for all of its employees from the Ministry of Transportation. It also required those employees whose licences were not in good standing to sign acknowledgments about not driving a company vehicle. There was also a company policy, communicated verbally only, that employees who were permitted to drive a company vehicle were not permitted to let anyone else drive it. However, in this case, J.C., contrary to company policy, gave control of the vehicle to C.N., a new employee. Because C.N. had not provided a copy of his driver’s licence to the Appellant when he was hired, he had signed the acknowledgement that he was not permitted to drive. J.C. was properly licensed and was permitted to drive a company vehicle. It was J.C. who then permitted C.N. to drive that vehicle. This is what creates difficulty for the Appellant in trying to show that section 50.2(3)(c) applies.
Mr. Lee testified that J.C. did make some efforts to check the status of the suspended driver’s licence before doing so. The Tribunal notes that J.C. is not in a supervisory or management role at the company; Mr. Lee confirmed that while J.C. had more work experience than C.N., they were both employed at the same level in the company. The Tribunal cannot find that J.C.’s efforts to check for C.N.’s driver’s licence could be considered as part of the due diligence of the Appellant company. There is no evidence that he was acting on behalf of the Appellant when dealing with C.N. and his use of the company vehicle. Even if it could be seen in this way, the Tribunal would still find that his efforts were insufficient. The Appellant does not accept the production of a driver’s licence as evidence of the status of the licence; it requires a Ministry abstract to prove a licence’s validity.
While the Appellant can be commended for putting into place certain procedures and policies to restrict the use of its vehicles, the facts in this case do not support due diligence within the meaning of section 50.2(3)(c) of the Act. The Appellant could not exercise the due diligence set out in the legislation because the Appellant did not attempt to confirm that C.N.’s licence was under not suspension before it allowed him the use of its vehicle. Rather, it entrusted the vehicle to an employee who then permitted C.N. to use it, contrary to the company policy. For these reasons, the Tribunal finds that the Appellant did not exercise due diligence as set out in 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 confirms the impoundment of the Appellant’s motor vehicle, and it will remain at the impound facility for 45 days.
LICENCE APPEAL TRIBUNAL
Mary Ann Spencer, Member
RELEASED: November 16, 2016