Licence Appeal Tribunal
Appeal from the Notice of Proposal of the Registrar under the Liquor Licence Act, RSO 1990, c L. 19 to Refuse to Renew a Licence
B E T W E E N :
1919664 Ontario Inc. o/a Play Bar Burlington (“Play Bar”)
Appellant
-and-
Registrar, Alcohol, Cannabis and Gaming Regulation and Public Protection Act, 1996
Respondent
DECISION
ADJUDICATOR: Matthew M. Létourneau, Member
APPEARANCES:
For the Appellant: Joseph Irving, Counsel
For the Respondent: Faye Kidman, Counsel
Hearing by videoconference: March 23 & 24, 2021
REASONS FOR DECISION
OVERVIEW
1The appellant, Play Bar appeals to this Tribunal regarding the Notice of Proposal to Refuse to Renew a Liquor Licence (“Notice of Proposal”) dated December 20, 2019 and issued by the Registrar under the Alcohol, Cannabis, and Gaming Regulation and Public Protection Act, 1996 (“Registrar”). The basis for the Registrar’s proposal is that Play Bar has failed to pay a monetary penalty that remains outstanding.
2The Registrar issued the Notice of Proposal due to the appellant’s failure to pay an Order for Monetary Penalty which remains unpaid since being issued on January 18, 2018 against the appellant in the amount of $12,000.00. Since January 18, 2018, Play Bar has not made any payments towards the $12,000.00. The facts are not in dispute.
3The Registrar submits that pursuant to s. 15(2) of the Liquor Licence Act, RSO 1990, c. L.19 (“Act”), Play Bar’s failure to honour its monetary obligations indicates that Play Bar will not carry on business in a financially responsible way and that it will not carry on business with integrity and honesty and in accordance with the law.
4S. 15(2) of the Act incorporates the grounds for refusing to issue a first licence set out in s. 6(2) of the Act. Both are grounds for denying the renewal of the licence in s. 6(2) of the Act. (The Act changed effective December 2, 2021 and a new act, the Liquor Licence and Control Act, 2019, SO 2019, c 15, Sched 22, came into force. The equivalent provisions have been considered).
ISSUES
5The issues in dispute in this hearing are:
a. Should Play Bar’s licence not be renewed under s. 15 of the Act because its financial position shows that it cannot reasonably be expected to be financially responsible in the conduct of its business as set out in s. 6(2)a) of the Act.
b. Are there reasonable grounds for belief that Play Bar will not carry on business in accordance with the law and with integrity and honesty as set out in s. 6(2)d) of the Act.
6Having considered the evidence and submissions, I direct the Registrar to carry out the proposal to refuse to renew Play Bar’s licence. I find that that the appellant has not paid the Order for Monetary Penalty. This is a legal order against the appellant intended to deter further infractions from taking place. I do not accept that the appellant took adequate steps to pay this order. The appellant submitted that the pandemic and the closure of their business was a chief reason in not paying. However, the appellant accepted that the Order was unpaid prior to the pandemic commencing. I find that I have reasonable grounds to believe that the past and present conduct of the appellant will not carry-on business in accordance with the law and with integrity and honesty.
LAW
7Subsection 6(2) of the Act sets out exceptions to when an applicant is to be issued a liquor licence, including the following exception:
(a) having regard to the applicant’s financial position, the applicant cannot reasonably be expected to be financially responsible in the conduct of the applicant’s business; […]
(d) the past or present conduct of the persons referred to in subsection (3) affords reasonable grounds for belief that the applicant will not carry on business in accordance with the law and with integrity and honesty;
8In Famous Flesh Gordon’s, at paragraph 18, the Court of Appeal for Ontario states that, “The standard of proof provided by s. 6(2)(d) of the Act is that of ‘reasonable grounds for belief’. There is no doubt that this is a lower standard of proof than ‘balance of probabilities’”.
ANALYSIS
9Play Bar is a company wholly owned by Fernand Araujo. The licence holder to pay an Order of Monetary Penalty no. ASL8566566, also referred to as no. 1587 (“OMP”) was issued by the Registrar on January 18, 2018 in the amount of $12,000.00.
10On July 31, 2019, the Registrar provided notice to the licence holder’s counsel of record advising that the OMP is due in full.
11On August 29, 2019, the Registrar again provided notice. A final notice was provided on November 7, 2019.
12Devin Sookdeo, manager, Liquor Eligibility, Licensing and Registration Branch for the Registrar, testified to say that liquor licences normally auto-renew, unless there is a compliance issue. When Play Bar’s licence came up for renewal, it was not auto-renewed. Instead, given financial penalties imposed for infractions, the non-payment and no answer to the final notice, this matter was reviewed for a NOP.
13Mr. Sookdeo stated that the OMP’s intent is to hold a licensee accountable for infractions that have been confirmed, such as failing to ID patrons under the age of 19. I find that in this case the OMP was based on the infraction of serving underage patrons. I was not presented with direct evidence of detailing the infractions that took place. I find what is relevant is the fact of the infractions and the subsequent OMP. Mr. Sookdeo testified that the expectation of the resulting OMP was that Play Bar would show compliance with the regulatory regime and pay this penalty to demonstrate that it understands that this type of infraction shows a lack of honesty and integrity cannot be repeated in the future. It was the evidence of the Registrar that if the penalty was paid at any point after January 18, 2018 until the final notice, the licence would have been issued. However, Mr. Sookdeo stated that at the time of the hearing, the Registrar would no longer entertain payment because the history of the file shows enforcement is needed to ensure compliance with the regime. I would add that this expectation was not presented in any documentation before, but remains the opinion of Mr. Sookdeo.
14On cross-examination of Mr. Sookdeo, it was clear that Play Bar did not respond to the Registrar, nor was there any evidence of an attempt by Play Bar or its representatives to reach out to the Registrar. The Registrar imposed the OMP to deter future infractions. The Registrar confirmed that Play Bar could reach out to request a payment schedule and that this is not barred. I find that this was not done. The most relevant finding is that Play Bar has not paid the OMP, which is a legal order and stems from past infractions.
15Play Bar did not dispute the base facts, nor did it present any evidence of their efforts to pay or even to contact the Registrar further to the receipt of the OMP.
16Play Bar suggested in argument that the pandemic had contributed to the failure to pay, but the final notice was provided before the onset of the pandemic and there was no evidence to support this assertion was presented at the hearing to demonstrate how the pandemic contributed to the failure to pay. I find that the failure to pay and attempts to satisfy the Registrar were deficient from the date of the OMP on January 18, 2018 to the date of the final notice on November 7, 2019 and beyond.
17The Registrar submits that the failure to pay this large of a financial penalty demonstrates that the appellant cannot be reasonably expected to be financially responsible. I agree. This constitutes past conduct which affords reasonable grounds for belief that the appellant will not carry on business in accordance with the law and with integrity and honesty. The Registrar imposed an OMP and Play Bar is expected to comply to demonstrate to the community that it serves that it can protect the public it is serving. The failure to engage with the compliance measure shows a lack of willingness to comply with legal obligations imposed, a disregard for legal orders and no sign that financial stewardship is a priority. Honesty and integrity require these paramount regulatory concerns to be addressed in a meaningful way. The risk of allowing such infractions to go unchecked is high, as it can promote dishonesty and a lack of integrity in keeping patrons safe through compliance with the regulatory regime. It is high risk to allow young people to consume alcohol. There has been no compliance efforts to address the monetary penalty stemming from these infractions despite several attempts on behalf of the Registrar to provide an opportunity and clear notice of payment. This demonstrates a lack of accountability and integrity.
18I considered the parties’ submissions regarding the possibility of imposing terms on the licence. The appellant sought a repayment schedule. However, Play Bar did not show any desire or ability to comply and I have no basis to recommend conditions. No payments have been made in nearly four years. Play Bar did not lead any evidence that it could comply with a payment schedule. Therefore, I decline to renew the licence on terms.
19I direct the Registrar to carry out the proposal to refuse to renew Play Bar’s licence.
20The appellant’s appeal is dismissed.
LICENCE APPEAL TRIBUNAL
Matthew M. Létourneau, Member
Released: February 8, 2022