Tribunals Ontario

Licence Appeal Tribunal

Tribunaux décisionnels Ontario Tribunal d'appel en matière de permis

Date: 2021-03-11

Appeal from a Notice of Proposal to Refuse Registration under the Horse Racing Licence Act, 2015, S.O. 2015, c.38, Sched.9 (“the Act”)

Zoltan Daniel Balla Appellant

And

Registrar, Alcohol, Cannabis and Gaming Regulation and Public Protection Act Respondent

DECISION AND ORDER

ADJUDICATOR: Harriet Lewis, Member

APPEARANCES:

For the Appellant: Zoltan Balla, Self Represented

For the Respondent: Elizabeth Maishlish, Counsel Nicolle Pace, Paralegal

Heard by teleconference: January 19 and 20, 2021

REASONS FOR DECISION AND ORDER

BACKGROUND:

1Zoltan Balla (“Mr. Balla”) appeals to the Licence Appeal Tribunal (the “Tribunal”) from a Notice of Proposed Order to Revoke his licence as an owner and trainer of Standardbred horses (the “Proposal”). The Proposal was issued on July 16, 2020.

2The Deputy Registrar of the Alcohol and Gaming Commission of Ontario (the “Registrar”) issued the Proposal pursuant to ss 14 and 19 the Act. The Registrar takes the position that there are reasonable grounds to believe that when acting as a licensee, Mr. Balla will not carry out the role of a horse owner or trainer in accordance with the law or with integrity, honesty or in the public interest having regard to Mr. Balla’s past conduct and including his failure to disclose convictions on his applications for licence.

3Mr. Balla has been involved in the Standardbred horse racing business from the time he was a child in his native Hungary. He moved to Canada in 2010 and, in 2012 started to work as a groom for a Standardbred trainer. Since February 2018, he has been a licenced owner and, since July 2018, he has also been licenced as a trainer. His latest licence application and renewal as an owner/trainer was in late February 2020.

4In 2016, Mr. Balla pled guilty to one count of using a forged document for the registration of motor vehicle plates and received a sentence for time served in pre-trial custody, a fine and fifteen months probation. In 2016, Mr. Balla was also charged with an assault on his common-law wife. He was taken into custody where he remained for some time because he could not make bail. Upon his bail being paid, he failed to comply with the recognizance given at his release to stay away from his victim. At trial, he pled guilty to the assault charge and in addition to time served, received a fine, fifteen months probation, and a weapons prohibition. He was also charged and pled guilty to an assault on his older daughter for which he received probation, a fine and victim surcharge. In 2018, he was charged with theft under $5,000, a matter which had not been adjudicated at the time of this hearing. In addition to the foregoing, Mr. Balla’s driver’s record indicates he has had numerous charges, fines and licence suspensions for various infractions including: driving without a licence, falsely claiming to have insurance, failing to restrain a child in a car seat, and failing to pay outstanding fines. None of Mr. Balla’s charges or convictions were disclosed on his applications for registration under the Act until the application of February 2020, where only the fact of some convictions being “onfile” was noted.

5Mr. Balla admits to the record of convictions disclosed in the criminal and motor vehicle licence searches conducted by the AGCO in preparation for this hearing. He admits pleading guilty to the assault and fraud/forgery charges against him but denies several of the allegations underlying his convictions and denies any intention to mislead the Registrar in his applications. He attributes some of his convictions and the actions underlying them to language difficulties and misunderstandings, and others to false evidence given by others and inadequate legal representation. He notes that he has never been found guilty of racing infractions nor disciplined in respect to his engagement in Standardbred racing. He asserts that horses are his life, and that notwithstanding his past record, he does not pose a threat to horses or to the integrity of horseracing or to the public perception of horseracing. He asks that the Tribunal allow him to continue his licensure.

6Although I have some sympathy for Mr. Balla’s personal circumstances, on the evidence before me and for the reasons noted below, I order the Registrar to carry out the Proposal.

ISSUES:

7The issues to be decided in this appeal are:

a. Are there reasonable grounds to believe that were he to continue to be licenced, Mr. Balla will not act in accordance with the law, or with integrity and honesty or in the public interest having regard to his past conduct?

b. Has Mr. Balla made false statements on his applications for licensure that would be grounds for denying him a licence?

c. Is there evidence or argument which would warrant an order of licensure with conditions?

THE LAW, RULES AND REGULATIONS:

8The Act sets out the regime for regulating the horse racing industry in Ontario through the Act, the regulations and the Rules. Section 10 of the Act provides that:

No person shall, with respect to horse racing in any of its forms, act as an owner, trainer……or in any capacity provided for in the regulations unless the person holds a licence for that purpose.

9Section 12 of the Act provides authority to the Registrar to conduct investigations into the “character, financial history and competence of an applicant for a licence” and s.12(5) requires disclosure by an applicant of any required information.

10Section 14 provides that:

The Registrar shall refuse to issue a licence to an applicant or to renew the licence of an applicant if,

(a) there are reasonable grounds to believe that, when acting as a licensee, the applicant will not act in accordance with the law, or with integrity, honesty or in the public interest, having regard to the past conduct of the applicant

11Section 19 provides that the Registrar “may propose to suspend or to revoke a licence for any reason that would disentitle the applicant to the issuance or the renewal of the licence.”

12Sections 20(3) and 20(5) gives an applicant a right to request a hearing by this Tribunal when a proposal to revoke a licence is made.

13Pursuant to s. 20(6), 20(7) and 20(8), the Tribunal may, by order, confirm or set aside the proposed order or direct the Registrar to take the action that the Tribunal considers the Registrar ought to take to effect to the purposes of the Act. The Tribunal may substitute its opinion for that of the Registrar and may attach conditions to its order or to the licence that it considers appropriate.

EVIDENCE AND ANALYSIS:

14In this decision I have analyzed the evidence according to the standards set out in section 14(a) of the Act. The Registrar called three witnesses who attested to the standards of the horseracing industry, to Mr. Balla’s licencing history and to his criminal and quasi-criminal history. Mr. Balla appeared without counsel and testified in support of his appeal but called no additional witnesses.

Issue (a): Does the applicant’s past conduct afford reasonable grounds for belief that he will not act in accordance with the law, or with integrity, honesty or in the public interest?

15The Registrar’s witnesses were: Clay Martin (“Mr. Martin”), an O.P.P. officer assigned to the Equine and Drug Unit of the Alcohol and Gaming Commission of Ontario (“AGCO”); David Trainor (“Mr. Trainor”), an investigator with the Legal Services Division of the AGCO; and Lisa Hocking (“Ms. Hocking”), the Manager of Horse Racing Eligibility at the AGCO.

The Complaints from Stevenson’s Training Centre:

16In September 2019, Mr. Martin was contacted by a racing compliance official to investigate a complaint made against Mr. Balla by an unnamed horseperson working out of Stevenson’s Training Centre, a horse boarding and training centre in Flamborough, Ontario, where Mr. Balla boards and trains horses.

17Mr. Martin was told that the complainant had alleged that Mr. Balla had “possibly been involved in a physical altercation in the training area,” had been selling cocaine, that there were concerns about the welfare of Mr. Balla’s horses and that Mr. Balla had “recently been released from jail on assault charges.” Mr. Martin testified that although he spoke to the complainant, the individual was not prepared to testify about any of his allegations. Mr. Martin admits that given the unwillingness of the complainant to testify, he did not do a follow-up investigation of most of the allegations. However, the complaint lead to Mr. Martin’s checking on Mr. Balla’s criminal record which revealed his history of charges and convictions. The racing compliance official who contacted Mr. Martin was not named and was not called as a witness. Mr. Martin did not interview Mr. Balla.

18Mr. Balla denies each of the allegations made against him by the un-named complainant. He did not appear to know who had made the allegations, but he attributes them to a fellow trainer who he believes wanted to discredit him and take his clients.

19Because no direct evidence of the substance of the complaint was led, it does not contribute to the reasons for my decision.

The Walmart Incident

20When Mr. Martin did police and driving records searches on Mr. Balla, he discovered that there was an outstanding warrant for Mr. Balla to appear on charges of theft from a Brantford Walmart in May 2018. The alleged theft was of food items with a value of $7.33 and a set of automobile speakers valued at $1,481.87. The warrant had never been executed, so Mr. Martin arranged for Ontario Provincial Police officers to attend at Flamboro Downs Racetrack on November 7, 2019 and arrest Mr. Balla on the warrant.

21Mr. Martin testified that although Brantford Police had not taken steps to execute on the warrant, he considered it his duty to see that some action was taken. Since then, Mr. Martin has had no direct dealings with Mr. Balla.

22Mr. Balla testified that he had never received a summons in respect to the Walmart incident. While he agrees he was in possession of the items, he denies that he intended to steal the items and they were relinquished to Walmart security at the time. He has an explanation as to what led to his being in possession of them. However, at the time of this hearing, the matter had not been heard by a court. I therefore do not base my decision on the evidence about this incident as presented by either the Registrar or Mr. Balla.

The Other Criminal Matters:

23Mr. Trainor’s role as an investigator with the AGCO Legal Services Division includes conducting interviews and obtaining documents for the evidentiary record in appeals such as this. Mr. Trainor testified as to the results of the documents searches that he conducted as well as those assembled by his predecessor who had recently retired. Mr. Trainor’s evidence detailed Mr. Balla’s criminal charges, his pleas, his convictions, and his sentences. His evidence was supported with documents that were admitted as exhibits.

Forgery of Motor Vehicle Registrations:

24In June and July 2015, while Mr. Balla was working from premises owned by Pristine Auto Sales (“Pristine”), he registered seven motor vehicles using false names. His explanation of his actions was that he was acting as a go-between for Pristine Auto and car purchasers who spoke only Hungarian or Romanian (in which he is fluent). He says he was acting on behalf of Pristine when registering the cars. Nonetheless, he pleaded guilty to one count of forgery and was sentenced to pre-trial custody, probation and a fine.

Assaults

25Mr. Trainor also tendered in evidence a copy of the Information laid for a charge of assault by Mr. Balla on his former common-law wife who is also the mother of his younger daughter. The allegations against Mr. Balla contained in that information, if all true, are deeply troubling. Mr. Balla was placed in custody following the incident and remained there for some time without being able to post bail. His bail was eventually posted, and he was released, subject to a recognizance which required that he have no contact with his victim.

26Eight days after his release, Mr. Balla breached his recognizance by attending at the common-law wife’s premises, accompanied by his legal wife and their teenaged daughter. As a result of that visit he was charged both with breach of his recognizance and with an assault against his teenaged daughter.

27In his evidence on this matter, Mr. Balla vehemently denied the substance of the allegations of the assault of his common-law wife, although he admits that an incident took place when he discovered that the victim had been seeing another man. He denies the details of the assault on his older daughter. Notwithstanding, with legal advice, and anxious to avoid a further jail sentence, he pleaded guilty to the assaults. On July 28, 2017, he was sentenced for the assault of his common-law wife and his breach of recognizance, to time served, fifteen months probation, a weapons prohibition, a nominal fine and small victim surcharge. On the same day, for the assault of his daughter, he received a sentence of fifteen months probation, (to be served concurrently with the other probation), a nominal fine and a small victim surcharge.

The Appellant’s Driver’s Record:

28Mr. Balla’s Ontario Driver’s Record from November 2015 until September 2019 was made an exhibit in the proceedings. It revealed that Mr. Balla’s licence was suspended in September 2019 and has not been reinstated. The 10-page document shows a detailed history of numerous previous suspensions for driving while his licence was suspended, unpaid fines and the payment history of most of those fines. It also shows two 2017 convictions for making false statements about having vehicle insurance and a 2018 conviction for failure to secure a passenger in a car seat. Mr. Balla does not deny the suspensions or convictions reflected by the record, except he maintains that each time he falsely attested that he had insurance, he was unaware that his policy had expired.

Issue (b): Has Mr. Balla made false statements on his applications for a licence

29The Respondent’s last witness was Ms. Hocking. Since September 2020 she has been the Manager of Horseracing Eligibility with the AGCO.

30Ms. Hocking confirmed that Mr. Balla has been registered as an owner/trainer since 2018. According to Ms. Hocking, Mr. Balla completed his registration applications at a licensing office located at a racetrack. She explained that such offices are staffed by a licensing agent whose duties include receiving applications, assessing the applicant for eligibility, and answering any questions. At the time of an application, a licensing fee is paid by the applicant. This application and registration system rely on applicants’ information being complete and truthful and the application contains wording indicating that “false answers may lead to refusal or cancellation of a licence”.

31Copies of Mr. Balla’s five applications to registration as an owner, a trainer, and owner/trainer were included in the Respondent’s documents. The first application, for registration as an owner, was made February 23, 2018. The last, a renewal application as owner/trainer, was made on February 27, 2020. All post-date the convictions described above. Ms. Hocking noted that each application form contains a section that asks whether the applicant “has been found guilty or convicted of an offence in any jurisdiction”, including those “where a conditional or absolute discharge has been granted”. It also asks whether an applicant has any charges pending in any jurisdiction. In all but the most recent application, Mr. Balla answered “no” to the question about offences, convictions or charges. Mr. Balla’s signature appears on each application.

32The most recent application, filed on February 27, 2020, was stamped “Received” by the ACGO on March 3, 2020. On this last application, Mr. Balla answered “yes” to the question on convictions but in place of particulars as requested wrote “ON FILE”.

33Ms. Hocking expressed the opinion that “on file” implied that there had been previous disclosure of convictions and licence suspensions, but no such disclosure had been made. She testified to the importance of answering the application questions fully and completely. Only when full and accurate disclosure on the applications is made can the Registrar assess the honesty and integrity of applicants and their suitability for registration.

34Notwithstanding the lack of detail as to the meaning of “on file,” Mr. Balla was registered and received a licensing card dated June 30, 2020, which is shown as valid until November 27, 2021. A copy of the card was identified by Ms. Hocking and made an exhibit.

35Mr. Balla’s evidence about the failure to disclose his convictions was contradictory. He admits that he did not disclose his convictions on his earlier applications. In respect to those earlier applications, he testified that he believed he was to disclose horse-racing convictions and he had none, either in Hungary or Canada. However, with respect to the latest application he said that he consulted a lawyer about how to answer the convictions question and was told that because his probation period was over, he could answer in the negative. I do not find either explanation credible. I find that Mr. Balla knowingly failed to disclose his past convictions and his Walmart theft charges on his 2018 application. Nonetheless, my decision is not based on his failure to disclose alone. I see it as only another issue that illustrates his failure to follow legal or regulatory requirements.

Ms. Hocking’s Additional Evidence

36Ms. Hocking confirmed that a licensing card allows the bearer access to the backstretch at racing venues. She said that based on Mr. Balla’s assault convictions and the allegations against him of assault and theft at Stevenson’s Training Centre, the Registrar has reason to believe that Mr. Balla’s presence in a backstretch could lead to his perpetrating a theft or violence against others working at the track.

37She admitted that the AGCO had not followed-up the allegations against Mr. Balla of assault, drug dealing, theft or mistreatment of animals at Stevenson’s Training Centre. She acknowledged that Mr. Balla achieved a high score of 79% on the required qualification exam set by the Standardbred Racing Association and that he has no record of racing infractions. However, it is her opinion that Mr. Balla’s off-track convictions, breaches of recognizance, forgeries and motor vehicle offences illustrate a pattern of conduct that demonstrate a lack of respect for law and regulatory authority. Because he has a repeated pattern of doing things outside of the rules (described by her as “cheating”), conditions on his continued registration would not be appropriate.

Mr. Balla’s Additional Evidence

38As noted, Mr. Balla was not represented by counsel at this hearing. He attended the videoconference from a cell phone and apparently without access to the documents filed by the Respondent which he denied having received. While he appears to have good comprehension of English, he had some difficulty expressing himself fluently or clearly, particularly when showing frustration or other emotion.

39Mr. Balla testified that his experience of incarceration was terrible and that since then he has suffered from depression. He is currently single and lives with his younger daughter who is now six years old. He has had primary responsibility for her care since she was an infant. Recently she has been spending part of each week with her mother with whom he now interacts on a more-or-less civil basis. On more than one occasion in his testimony Mr. Balla referred to his deep love of horses and his need to be around them for his mental health. He is currently unemployed and gave no evidence of his future plans other than to get back to working with horses. He still owns a couple of horses but has no current training clients, which he attributes to the public way in which he was arrested for the alleged Walmart theft. There was no evidence before me that since the Proposal in this matter, Mr. Balla has engaged in any illegal or inappropriate behaviour. However, neither was there any evidence of changes in Mr. Balla’s life that would lead me to think that his circumstances or attitudes have changed. He provided no evidence that he has sought counselling for his depression or taken an anger management course. While he admitted to making “mistakes”, he continued throughout his testimony to place blame on others, including his former legal counsel.

Issue (c): Is there evidence or argument which would warrant an order of licensure with conditions?

40The Registrar’s position as expressed by Ms. Hocking, is that given Mr. Balla’s history of breaching recognizance conditions are not appropriate. Mr. Balla gave no evidence as to any conditions which he would be prepared to abide by if I determined that conditions of registration should be imposed. Having regard to all of the evidence, including multiple instances of repetition of the same illegal behaviour (driving while suspended being one example), I do not think conditions are appropriate in this case.

ARGUMENT AND ANALYSIS

41In argument, counsel for the Registrar stressed the public protection purpose of the Act. Ms. Hocking suggested that Mr. Balla’s history of assault, fraud and theft charges pose an ongoing danger to others who may, in the future, encounter him in the backstretch at a track, or at a training facility. I am not convinced that that is the case. However, I see his repeated acts of dishonesty and his numerous driving infractions as symptoms of a basic lack of understanding and/or disregard of the strict requirements of Canadian law and Ontario regulatory legislation. The public protection concern I see is that an industry which involves gambling, such as the horse racing industry, must ensure a high level of integrity among its participants in order to maintain public confidence that it is being operated above board and that the public can have trust in its systems.

42While counsel spent some time arguing that Mr. Balla’s explanations of his conduct were attempts to re-litigate his convictions for using false documents and assault, I do not interpret them in that way. This appeal hearing was his opportunity to explain his behaviour: an opportunity that he may not have taken up when entering his guilty pleas.

43The Registrar’s counsel referred to the case of Dominic Khan v. Registrar, 2019 ONLAT HRLA (11479/HRLA) (“Khan”) which in turn references the leading case on reasonable ground for belief: AGC Registrar v. 751809 Ontario Inc., 2013 ONCA 157 known a Famous Flesh Gordon. Famous Flesh Gordon establishes that the standard to be applied in determining reasonable belief of future conduct is whether there is clear and compelling evidence for that belief. It also makes clear that in determining that belief, a decisionmaker can look outside the four corners of the licence. Based on that test, the Registrar submitted that I am entitled to look to conduct other than with respect to horseracing to the appellant’s other conduct.

44Mr. Balla’s past behaviour illustrates a clear and documented pattern of disregard of the law and a lack of understanding of the necessity of strict adherence to the law in order to maintain registration under any regulatory regime - not only Ontario horseracing. I am persuaded that Mr. Balla’s use of false documents, his breach of recognizance, his driving while suspended, his tendering of false insurance documents, and his repeated failure to disclose his convictions on his applications illustrate a pattern of behaviour that, provides reasonable grounds to believe that when acting as a licensee, he will not act with integrity, honesty or in the public interest.

45The lack of evidence from Mr. Balla that he has made efforts to understand the consequences of his behaviour and to address the possibility of its recurrence, coupled with his frequent attribution of responsibility for his actions to others, leads me to conclude that a suspension of his licence as an alternative to revocation, is not appropriate.

46At the conclusion of the argument, Mr. Balla was advised that s.23 of the Act allows for a reapplication for licence to be made two years from the date of refusal or revocation. He has the right to re-apply at that time, but s. 23(3) provides that the Registrar may reject any such application if it discloses no substantial new evidence or no material change in the applicant’s circumstances since the revocation took place.

DECISION AND ORDER

47I find that there are grounds to believe that were Mr. Balla to continue to be licenced, he would not act in accordance with the law, or with integrity, honesty, or in the public interest, having regard to his past conduct.

48I therefore uphold the proposal of the Registrar, and order that Mr. Zoltan Balla’s licence as an owner and trainer of Standardbred horses is revoked.