Licence Tribunal

Appeal d'appel en Tribunal matière de permis

DATE: 2016-04-01

FILE: 9312/CVOR

CASE NAME: 9312 v. Registrar of Motor Vehicles

Appeal under Section 50(1) of the Highway Traffic Act, R.S.O. 1990, c. H.8, from an Order of the Registrar of Motor Vehicles Pursuant to Section 47(1) to cancel the Commercial Vehicle Operator’s Registration Certificate and to Seize the Plate Portion of all Permits Issued

2386048 Ontario Inc.DBA Black Stallion Trucking Appellant

-and-

Registrar of Motor Vehicles Respondent

REASONS FOR DECISION AND ORDER

ADJUDICATOR: Mary Ann Spencer, Member

APPEARANCES:

For the Appellant: Arjun Vishwanth, Counsel (July 6 & 27, 2015) Lawrence Kwok, Counsel (October 5, 2015) Robert Stewart, Paralegal (November 6, 2015; January 28 & 29, 2016; March 16, 2016)

For the Respondent: Patrick S. Moore, Counsel

Heard at Toronto: July 6 & 27, 2015; October 5, 2015; November 6, 2015; January 28 & 29, 2016; March 16, 2016

REASONS FOR DECISION AND ORDER

The Appellant, 2386048 Ontario Inc DBA Black Stallion Trucking, appeals to this Tribunal under section 50(1) of the Highway Traffic Act, R.S.O. 1990, c. H.8 (the “Act”), from an order of the Registrar of Motor Vehicles (the "Registrar") issued on December 18, 2014 pursuant to sections 47 and 47.1 of the Act, to cancel the Commercial Vehicle Operator’s Registration ("CVOR") Certificate issued to the Appellant and to seize the plate portion of any permits issued.

The Order of Cancellation and Seizure was also issued to Day & Night Hawk Mobile Truck & Trailer Service Inc. Only 2386048 Ontario Inc. (“Black Stallion”) is appealing the Order.

The grounds for the Order of Cancellation and Seizure are that the Registrar, having considered the Appellant’s safety record, has reason to believe the Appellant will not operate safely.

The hearing in this matter began on July 6, 2015. At the commencement of the hearing, an adjournment was requested by Arjun Vishwanth, Counsel for the Appellant, due to the absence of James Alexander, the Appellant’s principal. Pending the outcome of an appeal, the Registrar’s Cancellation Order is stayed and the Appellant can continue to operate. However, after hearing submissions from the parties, a fleet limitation condition was ordered as a condition of granting the adjournment. The hearing recommenced on July 27, 2015. During the testimony of the Registrar’s witness Sriram Rangan, Mr. Vishwanth advised the Tribunal that he was withdrawing from the matter. At the request of Mr. Alexander, acting as Agent for the Appellant, a further adjournment was granted to enable the Appellant to retain new counsel.

The hearing recommenced on October 5, 2015 with counsel Lambert Kwok representing the Appellant. Mr. Kwok advised that he had only recently been retained by Bahram Aziz Beiki, the new owner of Black Stallion, and requested an adjournment in order to obtain and review previous disclosure documents. The adjournment was granted. However, after hearing submissions from the parties, as a condition of the adjournment, the Tribunal ordered that the stay on the Registrar’s Cancellation Order be lifted. As a result, the Appellant was required to cease its operations.

The hearing recommenced on November 6, 2015, with Robert Stewart representing the Appellant. Mr. Stewart requested a further adjournment advising he had been recently retained by Mr. Beiki and required time to review the disclosure documents. Further, Mr. Stewart advised that Mr. Beiki would benefit from the presence of a Farsi/English interpreter. The adjournment was granted; however, the lifting of the stay on the Registrar’s Cancellation Order remained in effect.

On January 28, 2015, the hearing recommenced again. Mr. Stewart advised the Tribunal that the interpreter he had retained had not honoured the booking, but that the Appellant was prepared to proceed without an interpreter.

EVIDENCE

Registrar’s Evidence

The evidence of the Registrar comprised a book of documents (Exhibit 3) and the testimony of witnesses Kyle Gray, Sriram Rangan and Sherry Atallah.

The following is a summary of the relevant evidence:

Kyle Gray has been employed by the Ministry of Transportation since 1998 and has been a facility auditor the past four and a half years. In this capacity, Mr. Gray conducts both routine audits in an assigned area of the province and investigative audits at the request of the Registrar.

Mr. Gray conducted an investigative audit at the Appellant’s facility on December 8, 2014 to determine who was in charge of the operation. He noted that he initially populates his audit report (Exhibit 3, Tab 12) with data from the Ministry of Transportation records. The Appellant’s address on record was 36 Laughton Ave., Toronto. However, Mr. Gray was directed to 8940 Jane Street, Vaughan. He noted that this site houses a number of companies and that he had conducted a previous audit of the company Joyce Express at that address. Mr. Gray met with the Appellant’s principal, James Alexander. Three other individuals were present; the dispatcher, the safety compliance officer, and the operations and human resource manager.

Mr. Alexander was cooperative during the interview and readily signed the Ministry’s Facility Audit Caution form. Mr. Alexander, who is a licensed mechanic, told Mr. Gray that he was both the president and mechanic of Black Stallion but, on the advice of safety consulting firm Vagans, spent 90 to 95% of his time in the latter capacity, having been told to “do what you do best and let the office run itself”. Asked by Mr. Vishwanth if the president of a company could also be its mechanic, Mr. Gray stated that he could.

Mr. Gray reviewed a number of Black Stallion’s records. He highlighted two work orders dated December 14, 2014 (Exhibit 3, Tab 13, pgs 104-107). These are for work on the same vehicle and appear to be written in the same hand. One is under the name of Black Stallion and the other is under the name JE Express Truck & Trailer Shop. Mr. Gray testified that Mr. Alexander advised him that he had written both documents but had made a mistake with the date on one. He explained he did maintenance work for both companies.

Asked if he knew where Black Stallion’s vehicles were and who was driving, Mr. Alexander told Mr. Gray he had no idea. Mr. Gray then asked Mr. Alexander his IFTA number, his fax number and his e-mail address. The operations manager responded with the IFTA and fax number. Mr. Alexander then stated “yes” when Mr. Gray asked him if he was “just the guy to sign the cheques”. Similarly, when asked how he obtained loads, Mr. Alexander stated “Allan Windows” and then the dispatcher provided more detail with respect to both incoming and outgoing loads.

Mr. Gray asked Mr. Alexander the name of his contact at Allan Windows and requested a copy of a bill of lading. One dated December 5, 2014 was provided (Exhibit 3, Tab 13, pg 103). Mr. Gray went to Allan Windows where he spoke to the shipping and logistics supervisor and was provided with a copy of a bill of lading. This document is identical to that provided at Black Stallion except it notes the carrier is “J.E. Express” rather than “Black Stallion” (Exhibit 3, Tab 13, pg 102).

The Tribunal notes that Mr. Vishwanth objected to the above evidence on the basis that it was hearsay and prejudicial and that no one from Allan Windows was called as a witness. The Tribunal allowed the evidence.

In cross-examination, Mr. Gray acknowledged that a company would not necessarily know who carried its load if it used a load broker and that it was possible that Allan Windows could have brokered its loads. He also testified that he found no financial ties indicating Black Stallion was affiliated with another company.

The Tribunal notes that Mr. Vishwanth objected to the appearance of the Registrar’s next witness, Sriram Rangan. Mr. Vishwanth advised the Tribunal that Mr. Rangan had a personal relationship with his client, having acted as its safety compliance officer. He submitted that this relationship was privileged. The Tribunal found no merit in Counsel’s argument for privilege and allowed the testimony. Mr. Rangan began his testimony on July 27, 2015.

Mr. Rangan is the co-owner of Vagans Inc., a safety compliance firm which undertakes work such as log book auditing, monitoring of CVOR reports, hiring and training drivers, and preparing written safety policies and procedures which may include areas such as hiring, discipline and vehicle maintenance. Mr. Rangan employs five staff, four of whom work at clients’ sites.

Asked if he had ever worked for Joyce Express, Mr. Rangan stated that he was retained by Induraj Nagularajah to put policies and procedures in place for that company before it appeared before this Tribunal in 2011. In September, 2014, Mr. Nagularajah retained Mr. Rangan to work for Black Stallion. Mr. Rangan agreed on the condition that he be allowed to place a full time staff member at the company. His service agreement provided for termination on the provision of 30 days’ notice but Mr. Rangan told Mr. Nagularajah that he would need a year to turn the company’s safety violation rating around. Mr. Rangan immediately hired and trained Jessica Evans. Ms Evans had no industry background; however she was “eager and ready to work”. Mr. Rangan placed her at Black Stallion and worked on site with her for two weeks to train her.

Mr. Rangan testified that there were no safety policies in place at Black Stallion when he arrived although Mr. Nagularajah, the only individual with whom he dealt, had them for another company, Simple Logistics. Mr. Rangan met James Alexander “a couple of weeks” before the December 2, 2014 Show Cause meeting held at the Ministry of Transportation and was told that Mr. Alexander would be taking an active role in the company. Mr. Rangan accompanied Mr. Alexander to the Show Cause meeting, having met with him two or three times to brief him about safety information such as log book compliance. Mr. Alexander had also been present in the Black Stallion office performing monitoring work in the two week period before the meeting. Referred to a letter and safety compliance plan dated December 2, 2014, addressed to the Ministry of Transportation and signed by Mr. Alexander (Exhibit 3, Tab 11), Mr. Rangan testified that he had drafted the letter.

Asked if there were safety issues at Black Stallion, Mr. Rangan responded “absolutely”. There was an issue communicating with drivers with respect to their log books because they were difficult to reach, often returning from runs after staff had left for the day. He requested a driver safety meeting be arranged and while Mr. Nagularajah agreed, the meeting did not take place. Mr. Nagularajah also agreed that drivers’ cheques should be left with Ms Evans as a means of ensuring they spoke to her but Mr. Nagularajah pre-empted this plan by giving the cheques to the drivers on weekends. Mr. Rangan also provided an example of a driver who went out on a run without insurance, noting that because of its size, Black Stallion did not have fleet insurance.

Mr. Rangan testified that Black Stallion had no driver disciplinary system in place before Vagans was retained. However, the system Vagans put in place was not always followed. He cited the example of recommending a driver be suspended because of violations. However, the driver spoke to Mr. Nagularajah on a weekend and was dispatched.

At this point in Mr. Rangan’s testimony, Mr. Vishwanth requested a recess. When the hearing resumed, he advised the Tribunal that he was withdrawing from the matter. The Tribunal then granted an adjournment. Mr. Rangan completed his testimony on January 28, 2016.

Mr. Rangan made many unsuccessful attempts to bring drivers together for safety meetings. However, he did have one-on-one meetings. Ms Evans also had difficulties meeting with drivers because they returned after hours or on weekends. Mr. Rangan discussed holding drivers’ cheques back to force a meeting but this did not happen.

Mr. Rangan testified that Black Stallion was controlled by Mr. Nagularajah. It was Mr. Nagularajah who gave him directions and who signed his compensation cheques. In January, 2015, Mr. Rangan’s contract was terminated. He had experienced some difficulty receiving payment for his services. Mr. Nagularajah would issue cheques but ask him not to cash them. And, Mr. Rangan had tried to cash one of the cheques but funds were not available. In January, Mr. Nagularajah asked Mr. Rangan to meet him at a Tim Hortons and gave him two cheques signed by James Alexander. While they were meeting, Black Stallion’s manager Faith McGill walked in and “threw a copy of the CVOR” at Mr. Rangan. The overall safety violation rate was 130%. Ms McGill told Mr. Rangan he knew nothing about safety. Mr. Nagularajah told him that Black Stallion was not getting insurance because of the high rate, but that an insurance broker told him he could get it if Black Stallion got a new safety consultant.

After being terminated, Mr. Rangan sent a text to Ms Evans and told her that she could work in his office in Vaughan. The following day, she advised him that she had been offered a job by Black Stallion which she had accepted. This was a violation of her contract with Vagans and Mr. Rangan initially threatened to sue her. However, he did not pursue this. He did send a disengagement letter to Black Stallion which he copied to the Ministry of Transportation.

Mr. Stewart asked Mr. Rangan about his action plan for Black Stallion. Mr. Rangan explained that when he arrived at Black Stallion, there were no files. His first priority was to create driver qualification files. To do so, drivers’ abstracts were pulled. This allowed him to identify problem drivers. Asked how many drivers he terminated, he stated his plan was to train them first and then, if necessary, to terminate them. He noted drivers needed to be trained but that for this to be successful, dispatch had to be on board. Asked if he was present when Mr. Nagularajah overrode his suspension of a driver, Mr. Rangan said he saw Mr. Nagularajah on the Monday and was told he had sent the the driver on the road on the weekend.

Mr. Rangan’s plan was to contest tickets received, but also to undertake training to ensure drivers did not accrue more violations. He agreed that when he began to work at Black Stallion, some of the previous convictions on its record could have been appealed. However, he also noted that the time limit for appeal had passed in many instances. Mr. Rangan told Mr. Nagularajah that all tickets should be fought and Ms Evans told drivers to send them in within twenty four hours. Notices were also distributed. Mr. Rangan agreed that drivers tend not to bring tickets in, but stated that if they know they are being monitored, a safety culture can be developed. Asked if it was not his responsibility to ensure drivers came to safety meetings, Mr. Rangan stated that he did everything he could. He believed in his plan but he needed the cooperation of the company.

Asked if Ms Evans was familiar with Ontario’s computerized record of offences, the ICON system, Mr. Rangan testified that she was not but that she was not required to use it. His instructions to her were to find a paralegal to fight tickets. Asked if she needed industry related skill to do this, Mr. Rangan stated that she only needed communication skills. She did not need to analyze the tickets. She was required to copy tickets to him. Similarly, when drivers were being hired, she was required to send their CVOR abstracts to him. Asked if he met with her regularly, he testified that he was on site at Black Stallion two or three times a week for the first month she was employed.

Mr. Rangan stated that he did not know Mr. Nagularajah’s exact position or title with Black Stallion but emphasized that Mr. Nagularajah was running the company. All communication came from Mr. Nagularajah and all cheques were signed by him until the final two which were signed by Mr. Alexander. Mr. Alexander did not give him any authority to act.

Sherry Atallah has been a Carrier Safety Rating Administrator with the Ministry of Transportation since 2001. Her responsibilities include the review of potential carrier sanctions, interviewing carriers with poor safety ratings to ensure plans are put in place to address issues, attending Show Cause meetings and reviewing safety rating disputes.

Ms Atallah explained the goal of the CVOR system is to improve road safety for all users of Ontario highways by having an effective monitoring and intervention system for all carriers. The responsibilities of certificate holders are set out in the Public Guideline issued by the Ministry of Transportation (Exhibit 3, Tab 1) and include, among others, employing qualified and licensed drivers; monitoring their safety performance, including hours of service; resolving driver safety issues; keeping vehicles in good, safe condition at all times; ensuring load security; and keeping required records.

A carrier’s performance is recorded and assessed over a two year rolling window and is expressed as an overall safety violation percentage. The CVOR system assigns points for collisions, convictions and inspections which are weighted to determine the overall safety violation rate. Collisions and convictions each form 40% of the record with inspection findings comprising 20%. Ms Atallah explained that collision points are assigned only where there is impropriety. Only safety related convictions are assigned points. Inspection points are assessed for “out of service” findings, that is mechanical defects or issues such as drivers exceeding their allowed hours of service which result in the vehicle being pulled from the road.

At pre-determined levels of the overall safety violation percentage, the Ministry intervenes or considers sanctions which can include suspension, cancellation or fleet limitation. Warning letters are issued at 35%, a request for a facility audit is triggered at 50%, at 85% an interview is requested and at 100%, a sanction analysis is conducted.

Referring to statistics prepared by her office, Ms Atallah testified that less than .1% of all carriers have violation rates exceeding 100%. Over 95% of carriers have rates less than 35%. (Exhibit 3, Tab 19).

In November, 2014, Ms Atallah conducted a Safety Record Review of the Appellant based on its CVOR abstract for the period of September 20, 2013 to October 18, 2014 (Exhibit 3, Tabs 1 & 2). The Appellant’s overall safety violation rate was 132.5%, with driver and vehicle out of service percentages of 16.67 and 38.24 respectively. Ms Atallah explained that while the Appellant’s CVOR certificate was granted in September, 2013, it did not begin operations until March, 2014 and the calculated violation rate took this period of inactivity into account. Had the rate been calculated over only the period the Appellant was operating, it would have been higher. Ms Atallah gave examples of the out of service infractions on the Appellant’s record from Ontario and other jurisdictions, including mechanical issues with brakes and logbook issues. For example, at an inspection on October 20, 2014, the driver was found to be driving while suspended in Ontario.

On November 3, 2014, a CVOR update for the period ending September 30, 2014 signed by Jessica Evans was submitted to the Ministry of Transportation (Exhibit 3, Tab 8). This update provided the actual kilometers travelled which was used to calculate the company’s threshold level. This document also showed that over a 12 month period the company had grown from operating only one truck to operating twenty one.

As a result of the safety review and Black Stallion’s safety rating of “Unsatisfactory”, the Registrar issued a Notice of Cancellation and Seizure on November 19, 2014. (Exhibit 3, Tab 10) On December 2, 2014, a Show Cause Meeting was held at the Ministry which James Alexander, Sriram Rangan and Jessica Evans attended on behalf of the Appellant. Ms Atallah recorded the minutes of the meeting. At this meeting, Mr. Alexander stated that he had placed responsibility for driver hiring and discipline on a previous safety consulting company. He admitted he did not have knowledge of the CVOR system.

Mr. Alexander also informed the Ministry that the company had relocated to 8940 Jane St., Vaughan. This was significant to the Ministry because it was the address of Joyce Express, a company that had its CVOR certificate cancelled following a hearing by the Tribunal in October, 2011 (Exhibit 3, Tab 15). Induraj Nagularajah was a corporate officer of that company. Mr. Nagularajah was also found to be an officer of Haniya Enterprises Inc. which was the subject of a Tribunal hearing in November, 2014. At that hearing, the Tribunal did not order the cancellation of Haniya’s CVOR certificate but did limit the size of its fleet (Exhibit 3, Tab 16). After learning of Black Stallion’s address change, the Ministry ordered the facility audit conducted by Mr. Gray. Ms Atallah also made an enquiry about Black Stallion’s insurance. She was informed that Mr. Alexander provided a letter to the insurer stating he had been operations manager at J.E. Express. (Exhibit 3, Tab 14).

Following the Show Cause meeting, Mr. Alexander submitted an action plan dated December 2, 2014 to the Ministry. In it, Mr. Alexander takes responsibility for Black Stallion’s safety record and notes that he had retained Vagans in September, 2014 after he had received the Ministry’s warning letter in August, 2014. Ms Atallah noted that the action plan refers to a company other than Black Stallion. When evaluating action plans, the Ministry looks for specific plans to resolve issues and for expected results. With respect to the quality of Black Stallion’s plan, Ms Atallah stated that there were no specific timelines for commitments like training. Asked how an action plan presented at a Show Cause meeting would be considered, Ms Atallah indicated that it would be favourable. If a plan presented did not have timelines,that would be discussed. She noted that a range of sanctions, including suspension and fleet limitation, could be considered by the Ministry.

When shown records of driver training and tests at Black Stallion by Mr. Stewart (Exhibit 4, Tab 7), Ms Atallah stated that she could not tell when the training was done or by whom, but agreed that testing was a way of educating drivers. However, she noted that the testing appeared to have taken place after the Ministry issued its Order and that the CVOR record did not improve after the training.

Ms Atallah testified that it is the Ministry’s position that Black Stallion is related to Joyce Express and to Haniya. However, the decision to issue the Cancellation Order was based on Black Stallion’s safety violation rate and the fact that its principal, James Alexander, exhibited little knowledge about the CVOR system. She confirmed that it is the Ministry’s practice to look at both the company’s record and its management in making decisions. She noted that Mr. Beiki does not appear on the Ministry records notwithstanding that certificate holders have an obligation to report any changes within 15 days. On October 6, 2015, she spoke to Mr. Beiki and faxed him a copy of the forms for updating. She could not recall if Mr. Beiki told her he was going to submit the form himself or if he was going to send it to his counsel to submit it on his behalf.

Asked if Induraj Nagularajah appeared as a corporate officer of Black Stallion, Ms Atallah indicated he does not. She also noted that any company that appeared to be affiliated with a cancelled company would be investigated to ensure the cancelled carrier was not operating under another name.

On January 21, 2016, Ms Atallah produced an update of Black Stallion’s CVOR record (Exhibit 5). The overall safety violation rate for the period December 22, 2013 to December 21, 2015 is 178%. Ms Atallah described this as “extremely high”; she has seen fewer than 5 carriers with rates at this level. She noted that the number of incidents recorded had increased since the Ministry issued its Order. The record now includes 5 collisions and 55 inspections with points assigned. Out of 108 inspections, 34 found Out of Service violations, including issues with brakes, lighting, and log books. Four violations, including 2 collisions, have occurred since August 26, 2015, the date on which Mr. Beiki was reported to the Ministry of Government Services as the owner and director of Black Stallion (Exhibit 6). Asked if Mr. Beiki would have known about these incidents had he not taken control of the company until September 23, 2015, the day on which he signed the purchase agreement (Exhibit 11), Ms Atallah agreed he would not have. On October 6, 2015, the day after the Ministry suspended the operations of Black Stallion, an inspection found two Out of Service violations. The truck was not one where an exception to the suspension was granted to allow trucks on the road the time to return to the yard (Exhibit 10).

Asked what policies the Ministry has in place to assist companies to ensure drivers report charges to them, Ms Atallah stated that it is up to the companies to put policies in place and that they can seek assistance from the Ontario Trucking Association, safety consultants or their insurance companies. The Show Cause meeting provides an opportunity for a company to explain to the Ministry what measures it has taken to ensure drivers comply. Asked if it would make a difference to the Ministry if a company advised that drivers had not notified it about charges, Ms Atallah stated that a company could discover charges by looking at its CVOR record. She noted that convictions under appeal are removed from the CVOR record the day after the Ministry is notified. Finally, asked what authority a company owner would have if drivers did not keep proper logbooks, Ms Atallah stated that an owner should have training programs and discipline policies in place.

Ms Atallah also testified that 5 vehicles previously plated to Black Stallion are now registered to a numbered company in Quebec which is operating as “Black Stallion Trucking” notwithstanding the fact that the Ministry’s Cancellation Order prohibits the transfer of vehicles without the consent of the Registrar (Exhibits 7, 8). The lessor of these vehicles is reported on the Quebec documents as Haniya Enterprises. Thirteen of the 22 vehicles previously plated to Black Stallion have been transferred out of province. Ms Atallah explained that the purpose of the transfer prohibition is to prevent the same company from operating out of province. Consent to transfer Black Stallion’s vehicles was neither requested nor given. Asked if the Ministry had investigated the leasing company that owns the vehicles transferred to Quebec, Ms Atallah indicated it has not. She agreed that the leasing company could transfer vehicles to another province or could have picked up the vehicles if they had not received payment. No specific notification to Ontario is required when a vehicle is registered in another province; however, there is an interprovincial database and a specific vehicle inquiry will reveal the transfer took place.

Appellant’s Evidence

Jessica Evans testified that she was hired by Sriram Rangan and began to work for Vagans in September, 2014. She was previously employed as a retail manager and had no experience with safety and compliance. Her initial training was to work two days at another company. She then went to Black Stallion where her duties included maintaining driver files, entering logbooks, maintaining vehicle maintenance files and hiring paralegals to fight tickets. She was also involved in hiring; she helped prospective drivers fill out applications and obtained their CVOR records. Mr. Rangan was available by telephone if she needed assistance; he also attended at Black Stallion every second Friday to pick up his cheque. When Mr. Rangan was there, he would check Ms Evans’ work and meet with Mr. Alexander.

Ms Evans worked in the company trailer with other staff, including dispatch, accounting and maintenance staff. Mr. Alexander had an enclosed office. He would come in to the office every morning, talk to the dispatchers and then leave to perform maintenance work at the garage. Ms Evans does not know if he serviced other companies’ vehicles. Asked if Mr. Rangan had authority in the Black Stallion’s office, Ms Evans said that he did because Mr. Alexander would tell him to “just get it done”. Ms Evans did meet Mr. Nagalurajah a few times. She does not know what his role was, but believes that Mr. Alexander consulted with him. He sometimes did tell her what to do but she took her direction from Mr. Rangan and later from Prince Saini, the safety consultant Mr. Alexander hired after the Vagans contract was terminated.

Ms Evans testified that Mr. Rangan wanted to train drivers. Ms Evans would set up four or five drivers to meet, but then Mr. Rangan would not be available because he either was writing exams for his paralegal courses or was busy with his children. He did conduct two Saturday training classes on hours of service and logbook violations. Many drivers got warning letters and one driver was suspended. However, Ms Evans could not recall if the driver’s performance improved afterwards.

With respect to ensuring drivers sent documentation into the office, Ms Evans stated that she met with the drivers and asked them to send it in. She had authority to call drivers in, but would tell Mr. Rangan before she did. There were no safety meetings held with the drivers. Referred to the December 2, 2014 letter signed by Mr. Alexander and sent to the Ministry of Transportation which indicates that a meeting was held on November 19, 2014, Ms Evans stated this letter was incorrect and that Mr. Alexander and Mr. Rangan were both aware it was incorrect.

When Ms Evans began to work for Black Stallion, the company was operating 12 trucks. When the company shut down, it had grown to 19 or 20. There were 30 to 35 drivers. The drivers were required to advise Ms Evans about inspection results and tickets. If there were charges, Ms Evans would inform Mr. Alexander, but the decision on whether or not to fight tickets was Mr. Rangan’s. Ms Evans indicated it was fairly simple to arrange for a paralegal when the tickets were fought.

Mr. Alexander told Ms Evans that because the safety record was not improving, Black Stallion wanted to fire Vagans but wished to keep her on staff. When the Vagans contract was terminated, she decided to stay at Black Stallion because she was not certain she would have a job with Vagans. She began to work directly for Black Stallion in January, 2015 and remained there until the company ceased operations in October, 2015. She described her current employment status with the company as being “on hold”.

After the Vagans contract was terminated, Mr. Alexander retained another safety company which was there until the company shut down. Mr. Rangan’s view was to look to the future; however, Prince Saini, the new consultant, was able to get things done. Asked if she discussed the CVOR record with Mr. Alexander, Ms Evans stated “James has no clue about what the CVOR record means.” His speciality was maintenance. Asked if the 2015 record was better or worse, she stated that it was worse.

Ms Evans could not recall when she became aware of the change in the ownership of Black Stallion. She saw Mr. Beiki in the summer of 2015 and then found out that he had taken over and began to work with him in August or September. She did discuss the safety performance with him. He also held meetings with Prince Saini in the summer. After he did take over, he was at the office full time.

Bahram Aziz Beiki began his testimony on January 29, 2016 and completed it on March 16, 2016.

Mr. Beiki testified that he came to Canada in 2008. Originally from Iran, he had moved to Dubai, and then to Malaysia. Mr. Beiki’s educational background is in accounting. In Malaysia, he had interests in a number of businesses including an import/export business, a travel agency and visa consulting. One of his hobbies was working on cars. This encouraged him to learn more about the trucking business and he started a transportation business in Malaysia which grew to a ten truck operation.

In Malaysia, Mr. Beiki also started a business distributing oxygenated water which he expanded to northern Europe. He then decided to distribute this product in Canada with plans to later expand to the United States. Mr. Beiki noted that oxygenated water has health benefits. Because water quality needs to be high, he came to Canada. However, he needed Health Canada’s approval to distribute his product and, because that agency was taking a long time to evaluate results, he had no earnings from this business. Because of his Malaysian trucking experience, he obtained his AZ licence in June, 2015 and decided to become an owner/operator. He took a truck he was considering purchasing to James Alexander at 8940 Jane Street for assessment. Mr. Alexander advised him not to purchase the vehicle, but told Mr. Beiki that he was prepared to sell his company for $30,000. Because of his past experience, Mr. Beiki did not consider running Black Stallion to be a large leap.

Mr. Alexander showed Mr. Beiki the company files although Mr. Beiki noted these were not in good order but were in boxes in the office. Mr. Beiki went through the details, for example, how the truck leasing system worked. Black Stallion was operating 13 vehicles, some of them owner-operated and some of them leased. The company was having some financial difficulties. However, Mr. Beiki determined that the vehicles were leased for a reasonable amount and that the company had a lot of accounts receivable. He looked at the monthly income and could see potential for it to be “pushed very much higher”. On August 26, 2015, he met with Mr. Alexander and his counsel Arjun Vishwanth at Mr. Vishwanth’s office to arrange the purchase of the company for $25,000. He knew that a CVOR certificate was required to operate the company but was not familiar with the CVOR system, noting that this is not needed in Malaysia. He then said he first saw the CVOR guidelines when he went for his own licence test.

Mr. Beiki testified that he did not retain his own lawyer to represent him in the purchase of the company. All of the purchase papers were prepared by Mr. Vishwanth. He had no discussions with Mr. Alexander about the status of the CVOR certificate and was advised of no problems by either Mr. Alexander or Mr. Vishwanth. When he looked at the files he did see something related to the Tribunal and asked Mr. Alexander about it. He was told that he did not need to worry about this because he would be starting fresh. He did not see the warning letter sent by the Registrar on July 8, 2014, the Notice of Cancellation or the update information Ms Evans had submitted to the Ministry. He was unaware that a Show Cause meeting had taken place and only became aware of the action plan submitted by Mr. Alexander at this hearing. Similarly, he had not seen the Facility Audit report before this hearing.

Mr. Beiki explained why the share purchase agreement (Exhibit 11) is dated August 26, 2015. He was prepared to sign on August 26, 2015 but there was no list of assets and contracts. He requested these but did not receive them until September 21, 2015. After taking time to review the documents, he signed the agreement at Mr. Vishwanth’s office on September 23, 2015 and received the keys to the Black Stallion office. Asked by Mr. Moore about the fact that the affidavit of Lena Kumar filed on his behalf on the October 5, 2015 hearing date indicates he assumed control of the company on August 26, 2015, Mr. Beiki stated that the affidavit is incorrect. He then modified this to state it was not incorrect, but that he did not take control until September 23, 2015.

On cross-examination, Mr. Beiki indicated that he did have records of his trucking experience in Malaysia but had not brought them to the hearing. With respect to the receivables at the time of his purchase of Black Stallion, Mr. Beiki estimated they totalled $200,000. Asked if he thought that $25,000 was a low purchase price, he stated he thought it was reasonable because there was also a lot of work to be done with the company and it had leasing obligations. He does not know how much of the receivables he has collected, stating that he had not recorded this yet and he had also used some of his own savings to support the company. He had hired someone, whose name he could not recall, to help him collect.

Between August 26 and September 23, 2015, Mr. Beiki was at Black Stallion’s office to observe operations. He testified that he did find out about the status of the CVOR certificate before he signed the purchase agreement but believed that he could deal with it. During this period, he met Prince Saini, the safety compliance officer retained by Mr. Alexander. Mr. Saini explained the safety rating system to Mr. Beiki; it was at this time that Mr. Beiki learned that each truck and the status of each driver was being monitored. However, Mr. Saini did not share many details with Mr. Beiki. And, Mr. Beiki wanted to check the status of the company’s operations on his own. He did not see the safety compliance plan produced by Mr. Saini (Exhibit 4, Tab 5) until this hearing. Similarly, he did not see the plan produced by Vagans (Exhibit 4, Tab 11) until this hearing. During this period, Mr. Beiki also spent time with Mr. Alexander to check the trucks and trailers. He testified that he has mechanical ability and he discovered that there were mechanical issues with the trailers, but not with the trucks. He could not recall whether he was aware of maintenance issues before he purchased the company.

Mr. Beiki testified that on September 10, 2015, after learning about the problems with the CVOR certificate, he retained counsel Lambert Kwok. However, Mr. Kwok was “mostly not available”. He instructed Mr. Kwok to complete the updates to the Ministry with respect to the ownership of the company. He only learned it had not been done at this hearing. Asked by Mr. Moore if he knew whether an amendment had been filed with the Ministry of Government Services, he indicated he was not sure. Mr. Moore then showed Mr. Beiki a corporate profile dated March 9, 2016 (Exhibit 12) that showed no changes and Mr. Beiki indicated he did not know how long it would take for the records to be updated. Asked if he had filed an update to the Ministry of Transportation as requested by Ms Atallah, Mr. Beiki said he had asked his accountant to do so.

Mr. Beiki now understands that Black Stallion’s safety violation rating is very high. But he did not see the number until the October 5, 2015 hearing date. He was shocked on that day when the Tribunal lifted the stay on the Registrar’s Cancellation Order. He went back to Mr. Alexander who told him this was not supposed to happen. He considered taking legal steps against Mr. Alexander but Mr. Vishwanth told him not to waste his money.

After the October 5, 2015 hearing date, Mr. Beiki studied the CVOR formula and now understands how to improve the safety rating. However, because the CVOR certificate was cancelled on October 5, 2015, Mr. Beiki has not had an opportunity to show that he can make a difference in the operation of the company. He has prepared a contract with a friend, “Mr. Ryan”, to address driver issues by meeting with drivers and teaching them about logbooks and rules and regulations. Before the company shut down, he identified which drivers and trucks had issues. His plan was to team a bad driver with a good one. He also plans to install electronic logs and to place cameras in truck cabs and use cell phone GPS capabilities combined with odometer pictures to ensure log books are properly maintained. He noted that having cameras operating 24 hours in the cabs would also prevent drivers from not reporting tickets. He used this system successfully in Malaysia and noted that he had studied FedEx’s practices and they used a similar system.

Mr. Beiki also planned to put trucks on a regular maintenance schedule. From discussions “Mr. Ryan” had with drivers, he learned that there were issues with the trucks. If the business were running, he would have two certified mechanics as well as a new manager, “Jasper”, on site. Each driver would be required to perform a “circle check” before operating. A maintenance history would be created for each truck. He also engaged a paralegal, Harvey Dennis, to address any tickets received.

Mr. Beiki noted that some of the convictions appearing on Black Stallion’s CVOR record, including charges against the company, had not been reported to the company by the driver. He then stated that drivers come from all over the world and some have different experiences with police which might make them reluctant to hand in tickets. In the short period the company was operating between September 23, 2015 and October 6, 2015, Mr. Beiki spoke to each driver personally and told them that tickets must be delivered to the company. When he initially got his own AZ licence, he drove long distance which helped him understand the rules and drivers’ perspective. He would arrange to speak to the drivers in their own language to ensure they understood requirements. Although he has hired no drivers since purchasing Black Stallion, he began to search for drivers, noting his preference would be to hire drivers with Canadian experience, but that he would have to hire as best he could.

Immediately after the stay on the Cancellation Order was lifted, Black Stallion requested an extension to enable its vehicles to return to the yard. It was only at this hearing that Mr. Beiki learned that one of the vehicles, not included in the extension, had violations after the stay was lifted.

Mr. Beiki testified that he needs six months to a year to change Black Stallion’s safety violation rate to less than half of its current number, stating “that’s what I can promise”. He has hired a new safety compliance expert, who, on his day of testimony, he identified as “Mr. Padha” after consulting his phone. He noted that he himself would look at each truck to determine the issues. Asked by Mr. Moore if he was aware that three safety consultants had been retained previously by Black Stallion with little positive impact, Mr. Beiki stated that he believes the right safety consultant had not been hired. Mr. Moore noted that no new safety plan had been filed and asked Mr. Beiki if he intended to use Mr. Saini’s plan. Mr. Beiki indicated that some of it was good and he would use those parts.

Twelve of the convictions appearing on Black Stallion’s CVOR record have now been appealed. Mr. Beiki indicated that seven or eight have been resolved and three remain under appeal. Asked by Mr. Moore if Mr. Dennis, the individual he hired, was in fact a paralegal, Mr. Beiki indicated that this does not matter because he is “dedicated”. Mr. Stewart then advised that Mr. Dennis is an employee of the company and that Mr. Stewart would be representing any drivers appealing tickets. Mr. Beiki then testified that he has not reviewed the CVOR record recently, stating that there was no reason to do so since he is not operating. Further, there was no reason to check the results Mr. Dennis was obtaining since he could see how dedicated he was. Mr. Moore then showed Mr. Beiki Black Stallion’s CVOR abstract for the period February 10, 2014 to February 9, 2016 (Exhibit 13) which indicates the number of convictions has been reduced from 62 to 57 and the overall safety violation rate has decreased to 162.7%.

When Mr. Beiki purchased Black Stallion, it had 13 trucks. There are now only 4 left. Until he heard Ms Atallah’s testimony at this hearing, Mr. Beiki was unaware that some of the trucks had moved to Quebec. He noted that he was not on site every day and that keys were kept in the trucks. Further, the trucks were moved around the yard as space was required. Only the security office would know what trucks moved in or out. The trucks were owned by the leasing company. Asked what he did when he discovered they were moved, Mr. Beiki testified that he had not made any payments on the leases. He has signed no papers related to the trucks and received no notice. He did not provide any assistance to anyone to transfer the trucks. He has no interest in the Quebec company operating as Black Stallion and suggested they might be operating under the name because it is on the side of the trucks.

Mr. Beiki also testified that he has no interest in Haniya Enterprises. While he is aware of the name, he did not know the company’s background until this hearing. He had also not heard of J. E. Express until this hearing, nor is he aware of who owns that company.

Black Stallion’s office is located in one of two trailers at 8940 Jane Street. There is also a repair facility located in a building. Haniya does not operate from that location and Mr. Beiki has no knowledge of Induraj Nagularajah.

Currently, Mr. Beiki is not operating any vehicles. However, he does have contracts, including one with Allan Windows, and he is brokering loads to honour these. He believes that he could successfully run the business with a minimum of 10 to 13 vehicles although his goal is to operate a fleet of 50. Operating with 13 vehicles would allow him to honour his existing contracts. But the electronic logs and monitoring system he wishes to implement would be more economical with 50 vehicles. Mr. Beiki would accept reasonable conditions such as weekly reporting or frequent audits on a CVOR certificate. He would also accept a prohibition on dealing with specific trucking companies. He is also committed to undertaking driver training and to developing a close working relationship with the Ministry of Transportation.

THE LAW

The statutory authority for the actions of the Registrar is set out in the Act as follows:

Suspension and cancellation of licence, etc., general

47. (1) Subject to section 47.1, the Registrar may suspend or cancel,

(a) the plate portion of a permit as defined in Part II;

… or

(c) a CVOR certificate,

on the grounds of, …

(f) the Registrar having reason to believe, having regard to the safety record of the holder or of a person related to the holder, and any other information that the Registrar considers relevant, that the holder will not operate a commercial motor vehicle safely or in accordance with this Act, the regulations and other laws relating to highway safety;

(2.1) Subsection 17 (4) applies, with necessary modifications, for the purpose of determining who are related persons under clause (1) (f).

Related Person

17.(4) An applicant is related to a person for the purpose of subsection (3) if,

(a) the applicant and the person are related individuals;

(b) either the applicant or the person is a partner of the other or was a partner of the other or they have or have had partners in common;

(c) either the applicant or the person, directly or indirectly, controls or controlled or manages or managed the other; or

(d) the applicant and the person have or have had common officers or directors or they are or have been controlled, directly or indirectly, by the same shareholders.

ISSUE

The issues before the Tribunal are first, whether there is reason to believe, having regard to the safety record of the Appellant or of a person related to the Appellant, that the Appellant will not operate a commercial motor vehicle safely or in accordance with the Act, the regulations and other laws relating to highway safety and, second, if there is such reason, what order the Tribunal should make.

SUBMISSIONS

Registrar’s Submissions

Mr. Moore submitted that the Appellant’s safety record warrants the cancellation of its CVOR certificate. There is also evidence that Induraj Nagularajah had been in charge of the Appellant’s operations and the Tribunal could therefore consider the safety record of Joyce Express where Mr. Nagularajah was a corporate officer. Mr. Nagularajah was also found to be a corporate officer at Haniya Enterprises Inc., a company upon which the Tribunal imposed fleet limitations in November, 2014. Mr. Moore submitted that the fact Mr. Beiki now owns the company does not change the Appellant’s situation. While Mr. Beiki indicated plans for the future, including the retention of a safety consultant, he provided no evidence to support his plans.

Appellant’s Submissions

Mr. Stewart submitted that while the safety record of the Appellant cannot be denied, it is based on the fact that previous parties did nothing to respond to violations. He noted that the company is responsible for drivers’ actions but questioned how a company can control those actions. The fact that the Appellant is located at the same address as was Joyce Express does not mean there is a relationship between them. Mr. Beiki has no relationship with Mr. Nagularajah. And, there is evidence that Mr. Beiki may have been misled when he purchased the Appellant. Mr. Beiki has experience and testified to specific plans to address safety issues. He is prepared to accept conditions and should not be penalized by a record accumulated under the previous owner. This is a “brand new company” with a new controlling mind.

ANALYSIS

The Appellant’s Safety Record

The evidence indicates the overall safety violation rate of the Appellant exceeds that of 99.9% of all carriers in Ontario. On November 19, 2014, the Registrar issued a Notice of Cancellation and Seizure based on Black Stallion’s safety record. The CVOR abstract for the period of September 20, 2013 to October 18, 2014 indicates an overall safety violation rate of 132.5%. Ms Atallah testified that this rate was understated because the company was not operating until March, 2014. On January 21, 2016, Ms Atallah produced an update of Black Stallion’s CVOR record (Exhibit 5). The overall safety violation rate for the period December 22, 2013 to December 21, 2015 had increased to 178%, a rate which Ms Atallah described as “extremely high”. The Tribunal notes that the record includes vehicle inspection findings, including ones related to brakes, as well as logbook violations and collisions. It also includes one instance of an unlicensed driver operating a vehicle which occurred after the hearing in this matter had commenced.

There was much testimony at this hearing with respect to the contribution that drivers’ violations make to the overall CVOR safety violation rate and the fact that the Appellant may not have been made aware of all of the tickets issued to its drivers in a timely manner and therefore may not have had the opportunity to contest those tickets. Although each presented a different perspective on the issue, Mr. Rangan, Ms Evans and Mr. Beiki all testified about the challenges faced in obtaining drivers’ compliance.

The Tribunal must deal with the safety record before it and is not prepared to speculate on whether or not that rate might be inflated because the Appellant either failed or was unable to contest violations or appeal convictions. The Appellant is responsible for its actions. As Ms Atallah noted, the Appellant could have discovered convictions by simply ordering a CVOR abstract. And, the Tribunal notes that even after Mr. Beiki retained someone to appeal convictions, the improvement in the record has been minimal. The record for the period February 10, 2014 to February 9, 2016 indicates the number of convictions has been reduced from 62 to 57 and the overall safety violation rate has decreased to 162.7%, a rate which still places Black Stallion among the worst .1% of approximately 50,000 operators in Ontario. Moreover, the Tribunal notes that this abstract includes a number of months when the Appellant was not operating, the stay on the Cancellation Order having been lifted on October 5, 2015.

The Appellant had the benefit of three different safety consultants in the short period it was operating, with no evident positive impact on its safety violation rate. Based on what can only be described as an abysmal safety record, the Tribunal finds that, in accordance with section 47(1) of the Act, the Registrar has reason to believe that the Appellant will not operate a commercial motor vehicle safely or in accordance with the Act, its regulations and other laws relating to highway safety.

The Safety Record of a Related Person

Mr. Moore submitted that there is also a basis for the Registrar to consider the safety record of a related person. In this regard, Mr. Rangan testified that he was hired, instructed, paid and fired by Induraj Nagularajah, and not by Mr. Alexander, then the owner of the Appellant. Hiring, instructing, paying and firing are all management responsibilities.

Mr. Stewart suggested that because the Tribunal questioned Mr. Rangan’s credibility in its decision in the Joyce Express matter, it should question his credibility now. The Tribunal acknowledges there are some substantial differences between the testimony of Mr. Rangan and Ms Evans. However, the Tribunal notes that while Mr. Rangan might have some animosity towards the Appellant given his contract was terminated, Ms Evans, who described her employment status as “on hold”, equally might have some interest in overstating Mr Rangan’s role and understating that of Black Stallion’s management. The Tribunal accepts Mr. Rangan’s testimony as the more credible. His testimony with respect to Mr. Alexander’s minimal role in managing the company is consistent with Ms Atallah’s testimony with respect to Mr. Alexander’s statements at the December 2, 2014 Show Cause meeting. And, notwithstanding Ms Evans’ testimony that she did not know Mr. Nagularajah’s specific role, she testified that he was present at the Appellant’s office and did give her instructions.

Mr. Gray presented copies of identical work orders made in the name of Black Stallion and J.E. Express and documents which indicated that J.E. Express was the carrier for an Allan Windows load which the Appellant indicated it carried. The Tribunal’s 2014 decision in Haniya Enterprises Inc., 8867 v. Registrar of Motor Vehicles, 2014 CanLII 70029 (ON LAT), identifies J.E. Express as the operating name of Haniya. That decision reads:

The evidence disclosed that Mr. Nagularajah runs the operations of Haniya and, as a result, performs the functions of a general manager. The Tribunal finds that he is an officer of Haniya. It follows from this finding that Haniya and Joyce Express have officers in common and are related for the purposes of s. 47 of the Act. The Tribunal can consider the safety record of Joyce Express in determining if there is reason to believe that Haniya will not operate safely.

The evidence indicates Induraj Nagalurajah was managing the operations of the Appellant at least until it was sold to Mr. Beiki. Therefore, the Tribunal finds Mr. Nagularajah to be a “related person” in accordance with section 17(4) of the Act. The Tribunal has already concluded that the Appellant’s safety record provides the Registrar with reason to believe that it will not operate safety. However, based on Mr. Nagularajah’s association with Joyce Express, the CVOR certificate of which was ordered cancelled by the Tribunal, the Tribunal also concludes that the Registrar has reason to believe that the Appellant will not operate safely based on the safety record of a related person.

The Operations of Black Stallion under Bahram Aziz Beiki

The Tribunal has carefully considered the appropriate action for the Registrar to take. Mr. Stewart argued that Black Stallion is now a new enterprise under the ownership of Mr. Beiki.

Mr. Beiki testified that he purchased Black Stallion, almost serendipitously, because Mr. Alexander offered to sell the company after he advised Mr. Beiki not to purchase a vehicle he was assessing. Mr. Beiki testified that he was very careful and concerned with details before he purchased the company. He spent some time with Mr. Alexander at the Appellant’s offices, a fact verified by Ms Evans’ testimony.

Mr. Beiki originally came to Canada to establish an oxygenated water business but decided to pursue other interests after spending some years dealing with Health Canada to meet its regulatory requirements. He delayed the purchase of Black Stallion from August 26, 2015, the date the Ministry of Government Services corporate records indicate he became a director, to September 23, 2015, because he wanted a list of company assets and contracts. Yet, despite his experience with regulatory requirements, he did not apply his attention to details such as the status of the Appellant’s CVOR certificate. While he noticed documents mentioning the Tribunal, he accepted Mr. Alexander’s advice that there was no impact on a new owner, even though he also testified that Mr. Alexander, while a good mechanic, did not know anything about the business.

Mr. Beiki testified that he became aware of the Order of Cancellation before he purchased the company. He retained counsel Lawrence Kwok on September 10, 2015, approximately two weeks before he finalized the purchase on September 23, 2015. Yet he testified that he did not have Mr. Kwok’s assistance during the transaction. Rather, he relied on the Appellant’s counsel, Arjun Vishwanth, who prepared all documents. And later, he also relied on Mr. Vishwanth’s opinion that it was not worth pursuing legal action against the former owner of the Appellant.

Mr. Beiki purchased the company for $25,000, an amount he believes was reasonable but which the Tribunal questions given his testimony that Black Stallion’s receivables totalled $200,000 with obligations of only $75,000. Questioned about how many of the receivables had been collected, Mr. Beiki could not provide an estimate, stating he had not recorded this yet. Nor could he recall the name of the individual he hired to help collect them.

At this hearing, Mr. Beiki presented himself as a businessman with considerable international experience. However, in the Tribunal’s view, Mr. Beiki’s actions do not reflect those of a prudent, experienced businessman. It stretches credulity that he relied on the Appellant’s counsel, paid a minimal amount for the company and finalized the purchase of a regulated business even though he was aware its CVOR certificate was under threat of cancellation.

The Tribunal notes that there is some question as to when Mr. Beiki assumed control of the Appellant. The affidavit of Lena Kumar which was submitted on behalf of Mr. Beiki on October 5, 2015 and to which he testified, indicates that he became a director and assumed control of the Appellant on August 26, 2015. Mr. Beiki later testified the affidavit was in error and that he did not take control until the purchase was completed on September 23, 2015. Ms Evans testified that Mr. Beiki was on site during the summer and took over in “August or September”. Mr. Beiki’s testimony is that he was conducting research.

Even if the Tribunal accepts that Mr. Beiki did not control the Appellant until September 23, 2015, there are questions with respect to his attention to detail after that date. He testified that he did not know when or how the Appellant’s leased vehicles, some of which the evidence indicates were later registered in Quebec to Haniya Enterprises, a company associated with Mr. Nagularajah, were removed from 8940 Jane Street. He did not make any inquiries with the leasing company. Given Mr. Beiki would not finalize the purchase of the company until he received a list of assets, the Tribunal finds it difficult to accept that he was completely unaware of or apparently unconcerned about the disposition of its vehicles.

Mr. Beiki also testified that he has hired someone to appeal past convictions. However, he saw no need to monitor the impact of this work on Black Stallion’s CVOR record. Until this hearing, he was unaware that there were violations on October 6, 2015, the day after the stay on the Cancellation Order was lifted. And, even though Mr. Beiki became aware during Ms Atallah’s testimony in January, 2016 that neither the Ministry of Government Services’ corporate records nor the Ministry of Transportation’s records had been updated, he provided no information to prove the updates had been sent as he testified he had instructed. Given the importance of this hearing to Black Stallion’s future, the Tribunal is surprised that Mr. Beiki did not ensure he was fully conversant with the company’s current status.

The Tribunal must assess the probability of whether or not, the Appellant, under Mr. Beiki’s guidance, will operate safely and in accordance with the law in the future.

As noted above, Mr. Beiki first appeared before the Tribunal on October 5, 2015. He completed his testimony on March 16, 2016. However, the documents entered into evidence by the Appellant were prepared by Mr. Vishwanth and were entered as exhibits on July 27, 2015. With respect to Mr. Beiki’s plans to operate the company, the Tribunal has only his testimony before it.

Mr. Beiki presented no documentary evidence to support his testimony with respect to either his industry related experience in Malaysia or his plans to change the safety performance of the Appellant. He stated that he now understands the causes of the Appellant’s past safety record and intends to address problems related to drivers’ log books and drivers’ failure to report incidents by instituting a sophisticated system using cameras, GPS and electronic logs. He provided no written information to demonstrate how this system would work or be monitored. He would prefer to hire drivers with Canadian experience but provided no indication of how he intended to attract these drivers. He intends to implement a cycle of regular vehicle maintenance and to hire two licensed mechanics but did not identify what experience he might be seeking.

With respect to policies and procedures, he testified that he has retained a new safety consultant, although he could not recall the consultant’s name without assistance and he provided no information with respect to the consultant’s credentials. He testified that he intends to rely on parts of the safety compliance plan previously prepared for the Appellant by Prince Saini, which the Tribunal notes did not result in an improved safety violation rate.

The Tribunal acknowledges that Black Stallion is currently not operating. However, the fact the company is not operating does not preclude the preparation of a new safety compliance plan or the presentation of more detailed information on proposed policies, procedures and systems.

The Tribunal has considered whether or not the Appellant could operate with conditions. Frequent reporting to the Ministry and audits were suggested. The Tribunal notes that more stringent conditions such as fleet limitation or a commitment not to exceed a specific overall safety violation rate were not among those suggested. Were the Tribunal convinced that Mr. Beiki had solid industry related experience and knowledge, and had specific and documented plans been presented with respect to his intended method of operating, the Tribunal might have been able to consider the latter type of condition. However, no such information was presented. And, as noted above, Mr. Beiki’s testimony with respect to the purchase of the company has placed his credibility at issue.

The Tribunal is being asked to accept that Mr. Beiki has good intentions. However, in the absence of any evidence of Mr. Beiki’s industry experience or any tangible evidence of steps he has taken towards the implementation of his commitments to operating safely, the Tribunal has no basis on which to determine that the future operations of the Appellant would differ from its past operations. The Tribunal therefore concludes that the Appellant’s CVOR registration should be cancelled.

ORDER

Pursuant to the provisions of section 50(2) of the Act, the Tribunal orders the Registrar to carry out the Cancellation and Seizure Order dated December 18, 2014 and to cancel CVOR certificate # 177-767-197 issued in the name of 2386048 Ontario Inc. DBA Black Stallion Trucking and to seize the plate portions of all commercial vehicles and trailers registered in its name.

LICENCE APPEAL TRIBUNAL

________________________

Mary Ann Spencer, Member

Released: April 1, 2016