10248 v. Registrar of Motor Vehicles, 2016 CanLII 50099

Licence Tribunal

Appeal d'appel en Tribunal matière de permis

DATE:

2016-06-24

FILE:

10248/MVIA

CASE NAME:

10248 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.

Appellant

Appellant

-and-

Registrar of Motor Vehicles

Respondent

REASONS FOR DECISION AND ORDER

ADJUDICATOR:

Geneviève Blais, Member

APPEARANCES:

For the Appellant:

Principal of the Appellant, Agent

For the Respondent:

Steve Grootenboer, Agent

Heard by teleconference:

June 20, 2016

REASONS FOR DECISION

A hearing was held on June 20, 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”).

The Tribunal ruled to confirm the impoundment pursuant to section 55.1(3) of the Act. 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: 2006, CHEV, C55 (the “vehicle”)

Date of Appeal: May 30, 2016

The Appellant is a small corporation. The Appellant’s Agent is a principal of the company and the suspended driver is a driver hired by the company on a seasonal basis. Therefore, to protect personal information, the names of the Appellant and its Agent are not being used in this decision.

ISSUES

As set out in the Appellant’s request for hearing (Exhibit #2), the owner appeals on the basis that the loss of the vehicle will result in exceptional hardship, as provided in section 50.2(3)(d) of the Act.

There was some evidence to suggest that the Tribunal should also consider the possible grounds that the vehicle owner exercised due diligence (i.e. all reasonable efforts) to determine that the driver’s licence was not suspended as provided in section 50.2(3)(c) of the Act. Even though the Appellant did not specifically outline this ground in the Notice of Appeal, the Tribunal can consider it if both parties are provided with a fair opportunity to respond.

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?

Should the Tribunal order the Registrar to release the motor vehicle on the basis that the impoundment will result in exceptional hardship?

FACTS

Evidence for the Appellant

The Appellant’s Agent stated that the Appellant operates a sound and lighting production company. The company provides equipment for various musical venues and corporate events. They hire 12 to 20 drivers on a contractual basis to drive their trucks to transport and set up equipment during the busy summer months. The impounded vehicle represents the smaller vehicle of the company’s several trucks. It is in use 60 to 70 hours a week as it is the most versatile vehicle in their fleet. The suspended driver has worked for the company as a sub-contracted driver and sound technician for approximately six years. On the evening of the impoundment, he had taken the vehicle home overnight to drive to a venue early the following morning.

The Appellant’s Agent stated that the company hires drivers with both “G” and “DZ” licences. When the company renews their annual insurance policy, they provide their insurance broker with two types of documents on their drivers. The documents are 1) scans of the ‘‘G’’ driver’s licences and 2) abstracts of the “DZ” drivers. The company has always assumed that the insurance broker verified the documents and would contact them in the event that there was an issue with a licence. In this case, the suspended driver had provided a licence and the company had assumed it was a valid permit and therefore did not follow up with the insurance broker.

As the loss of the impounded vehicle impacted immediately on their business, the Appellant’s Agent stated that the company rented a replacement vehicle. This was the only alternative available to them to maintain the company’s business commitments during their busiest season. The replacement vehicle is costly, and this cost and the future impound fees have put a severe strain on the company’s finances. The Appellant’s Agent added that the suspended driver believed he had a valid licence and he intends to pursue the matter with the Ministry of Transportation. Notwithstanding, he has offered to help the company pay the impound fees.

In cross-examination, the Appellant’s Agent acknowledged that it may have been unwise in the past to solely rely on the company’s insurance broker to check the validity of the drivers’ licences. He stated that his company has taken steps to change their policy, and in the future, they intend to verify the drivers’ information themselves.

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:

1. Copy of the Ministry of Transportation records indicating that, among other things, the impounded motor vehicle is registered in the name of the Appellant and as owner;

2. 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;

3. Copy of the Notice forwarded to the Registrar of Motor Vehicles regarding the impoundment;

4. Copy of the Ministry of Transportation records indicating that the driver at the time of impoundment had been convicted on January 11, 2016, of Impaired Driving under the Criminal Code of Canada pursuant to which the driver’s licence of the driver was then suspended until January 11, 2017.

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:

1. 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.

2. 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.

3. 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 Appellant here appeals on the basis of sections 50.2(3)(c) and (d).

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?

The Shorter Oxford Dictionary, 3rd ed. provides the definition of “due diligence” as follows:

Due: A. adj. 1. That is owing or payable, as a debt. 2. Belonging or falling to by right. 3. That ought to be given or rendered; merited. 4. Such as ought to be; fitting; proper; rightful. 5. Such as is requisite or necessary; adequate. 6. To be ascribed or attributed; owing to, caused by, in consequence of. 7. Under engagement or contract to be ready or arrive (at a defined time).

Diligence: 1. The quality of being diligent; industry, assiduity. 2. Speed, dispatch. 3. Careful attention, heedfulness, caution. 4. Law. The attention and care due from a person in a given situation....

Also, “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.

Issue Should the Tribunal order the Registrar to release the motor vehicle on the basis that the impoundment will result in exceptional hardship?

The Shorter Oxford English Dictionary, 3rd ed. defines “exceptional hardship” as follows:

Exceptional: Of the nature of or forming an exception; unusual.

Hardship: 1. The quality of being hard to bear; hardness; severity. 2. Hardness of fate or circumstance; severe toil or suffering; extreme privation.

Also, where the owner appeals on the ground of exceptional hardship, subsection 50.2(4) provides:

(4) Clause (3)(d) does not apply if there was a previous impoundment under section 55.1 with respect to any motor vehicle then owned by the same owner.

Section 10 of O. Reg. 631/98 provides the criteria to be considered and those not to be considered in determining the appeal under this section. First, the Tribunal must consider whether no alternative exists for the impounded vehicle. If there is no alternative, then the Tribunal may consider whether the impoundment will result in a threat to the health or safety of any person ordinarily transported by the motor vehicle, or a threat to public health and safety or to the environment or property of a community in whose service the vehicle is ordinarily used.

Second, the section provides that the Tribunal may not, except in certain circumstances, consider certain factors:

• financial or economic loss to any person,
• loss of employment or employment opportunity to any person, or
• loss of education or training.

These factors may be considered if the owner demonstrates that:

• there is no alternative to the vehicle available,
• the loss will be immediate, significant and lasting,
• the impact will be on a person ordinarily transported by the vehicle and
• the impact of the loss will be on someone other than the suspended driver and will not be the result of a loss by the suspended driver of the type described above.

The Regulation also states that the Tribunal cannot consider inconvenience to any person as being exceptional hardship. All elements of the grounds of appeal must be proven on the balance of probabilities by the owner of the vehicle.

APPLICATION OF LAW TO FACTS

In closing, the Appellant’s Agent submitted that the Appellant had relied on his insurance broker to check the validity of the driver’s licence. The Appellant has no previous violations under the Act and steps have been taken to ensure that a similar situation does not recur. The vehicle impoundment has resulted in financial hardship for the company.

The Agent for the Registrar submitted that the company’s practices were insufficient to ensure the validity of the sub-contractor driver’s licence. The Appellant has an alternative to the impounded vehicle, and although the loss of the vehicle may add financial strain to the company, there has been no loss of business. Accordingly, the Registrar submits that the grounds of due diligence and exceptional hardship, as defined by the Regulation, have not been met.

The legislation requires an owner of the motor vehicle to make reasonable efforts to determine whether or not the licence of the person who is to drive the owner’s vehicle is valid. To rely on a defence of due diligence, an Appellant must demonstrate that reasonable steps were taken to ensure the validity of the driver’s licence.

At a minimum, in order to satisfy the requirement that it had exercised due diligence, the Appellant ought to have ensured that its sub-contracted driver had a valid licence to operate a motor vehicle. Especially for a business with a number of vehicles that are extensively used by its drivers, this involves more than just asking each driver to show their driver’s licence. The Appellant’s Agent stated the company relied on its insurance broker to verify the validity of the driver’s licence. But this was done without any clear instructions to the insurance company about checking into the status of each person’s licence. The Appellant simply presumed that the insurance company would do this, and it turned out that they did not. Under these circumstances, the Appellant must bear the responsibility for the fact that one of its drivers drove a company vehicle while his licence was under suspension. Therefore, the test in section 50.2(3)(c) of the Act has not been met and the appeal fails on this ground.

With regard to the ground of exceptional hardship, the Appellant’s Agent testified that the impoundment has not changed the number of vehicles available to operate the business as he has rented a vehicle to ensure there is no loss of service to his customers. The Appellant’s primary concerns are the cost of the rental vehicle and the fees to release the vehicle from the impound facility.

In deciding whether there is exceptional hardship under the legislation, the first hurdle for the Appellant is to show that there is no alternative to the impounded vehicle. If it is reasonable for the Appellant to rent a replacement vehicle, then this means there is a reasonable alternative. In this case, the Appellant has rented a replacement vehicle for the whole period of the impoundment thus far, because it needs this vehicle for their business. While it is likely very expensive, it presumably is worth the cost from a business perspective.

The Tribunal finds that the evidence does not support the Appellant’s case on the ground of having no alternative to the impounded vehicle. This finding alone is enough to conclude that the ground of exceptional hardship, as defined in the Regulation, has not been proven.

But even if the Appellant were able to prove that it has no reasonable alternative to the impounded vehicle, it would still need to prove that the financial loss caused by the impoundment was “immediate, significant and lasting.” While the total costs of the rental vehicle and impoundment may meet the definition of being “significant”, there is no evidence to suggest that the loss to the Appellant’s company would be “lasting” in nature.

Therefore, the appeal has failed.

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

Geneviève Blais, Member

Released: June 24, 2016