Echo Bowling Brantford Inc. o/a Echo Bowling v. Registrar under the Alcohol and Gaming Commission of Ontario Act, 2019, 2024 CanLII 18070

Licence Appeal Tribunal File Number: 14571/LLCA

Appeal from a Notice of Proposal to Refuse Transfer under the Liquor Licence and Control Act, 2019, S.O. 2019, c. 15, Sched. 22

Between

Echo Bowling Brantford Inc. o/a Echo Bowling

Applicant

and

Registrar under the Alcohol and Gaming Commission of Ontario Act, 2019

Respondent

Decision

VICE CHAIR:

Geoff Pollock

APPEARANCES:

For the Applicant:

Courtney Boyd, Counsel

For the Respondent:

Elizabeth Maishlish, Counsel

Brian Haddad, Articling Student

Heard by Videoconference:

September 18, and November 1, 2023

BACKGROUND

1The Appellant ECHO Bowling Brantford Inc. (“Echo”) is the holder of Liquor Licence No. LSL70501 under the Liquor Licence and Control Act, 2019 (the “Act”) for the premises known as ECHO Bowl.

2On August 31, 2022, the Deputy Registrar received an application to transfer the licence to the Applicant David Bentley. The Applicant and his fiancée Kristen Alberto, are both officers, directors and shareholders of Echo. The Applicant owns 99% of the outstanding shares of the corporation, whilst Ms. Alberto, owns the remaining 1% of shares.

3Pursuant to subsection 15(1)(b) of the Act, the Registrar seeks to refuse the transfer of the licence to the Applicant. The Registrar’s grounds are that the Applicant made a false statement or provided false information in an application under the Act, and that the past, or present conduct of the Applicant, affords reasonable grounds for belief the Applicant will not carry on business in accordance with the law and with integrity and honesty.

ISSUE TO BE DETERMINED

4The issue to be determined is whether the Registrar has established:

a. that the past or present conduct of the Applicant affords reasonable grounds for belief that the Applicant will not carry on business in accordance with the law and with integrity and honesty; or

b. that the Applicant made a false statement or provided false information in an application under the Act.

c. If the Registrar has succeeded in establishing either ground above, such that the Applicant is ineligible to be transferred the licence, can the licence instead be transferred to Kala Berkby, the Applicant’s sister?

RESULT

5For the reasons set out below, the appeal is dismissed. Although the Respondent did not establish that the Appellant made a false statement or provided false information in an application under the Act, the Respondent has established that the past conduct of the Appellant affords reasonable grounds for belief that the Appellant will not carry on business in accordance with the law and with integrity and honesty.

ANALYSIS

The Law

6Under s. 15(1)(b) of the Act, a person may apply to the Registrar to transfer a licence to a different person, and the Registrar may approve the application or issue a proposal to refuse to transfer the licence.

7Under subsection 155(3)(b) of O. Reg. 746/21 (“the Regulation”), a licence shall not be transferred if the recipient would not be eligible to be issued the licence under subsection 3(4) of the Act.

8Subsection 3(4) of the Act provides that an applicant is not eligible for a licence if:

(b) the past or present conduct of [the applicant] affords reasonable grounds for belief that the applicant will not carry on business in accordance with the law and with integrity and honesty;

(c) the applicant or an employee or agent of the applicant makes a false statement or provides false information in an application under this Act.

9The Registrar bears the burden of proof. In respect of s. 3(4)(b), the Registrar must not only prove the facts upon which it relies on with respect to the Appellant’s past or present conduct makes him ineligible for a licence, but prove that there is a nexus between the impugned past or present conduct and the ability of the Appellant to carry out his duties under the applicable legislation, see: CS v. Registrar, Real Estate and Business Brokers Act, 2002, 2019 ONSC 1652 at para. 32 (Div. Ct.). These facts must be proven on the balance of probabilities.

10To succeed, the Registrar need only to show that the Appellant’s past or present conduct affords reasonable grounds to believe that he will not act in accordance with the law, or with integrity, honesty or in the public interest. “Reasonable grounds to believe” is a standard lower than a balance of probabilities, meaning that I do not need to find that it is more likely than not that he will not act in accordance with the law or with honesty or integrity: see Ontario (Alcohol and Gaming Commission of Ontario) v. 751809 Ontario Inc. (Famous Flesh Gordon’s), 2013 ONCA 157 at paras. 18-19.

11In respect of subsection 3(b)(5), the task of the Tribunal is to determine whether the Registrar has demonstrated on a balance of probabilities that the Applicant knowingly made a false statement in his application.

The Premises

12The Premises is located in a strip mall Brantford. It is a 5-pin bowling alley, that has been in the community for 40 years. Echo is home to both adult and youth bowling leagues and tournaments. It is currently the only bowling alley in Brantford.

The Applicant’s Highway Traffic Act Convictions

13Between 2009 – 2017, the Applicant had 4 Highway Traffic Act (“HTA”) convictions. The Applicant did not disclose these convictions on his application, which asked if he has “ever been charged, found guilty and/or convicted of any offence under any legislation in any jurisdiction. This includes any absolute and/or conditional discharges, withdrawn charges, suspended sentences, convictions, fines or guilty pleas.”.

14In submissions, counsel for the Respondent contended that this ought to be read to include not only matters such as Criminal Code matters, as well as HTA charges, but would also be extended to any parking ticket that one received in any jurisdiction, for the entirety of one’s lifetime. Counsel for the Respondent took the position that any parking ticket ever received –even if one was not convicted for the ticket—was of significant interest to the Registrar in determining the eligibility for the issuance of a licence. I found this argument to be troublesome and devoid of merit.

15On cross examination, Devin Sookdeo, an eligibility officer, who has been employed by the Registrar since 1998, conceded that they have a written policy, on disclosure for the application, that typically is only concerned with such matters in the immediate 5-year prior period.

16The Applicant gave compelling and persuasive testimony that it did not occur to him that the Registrar would be interested in his speeding tickets and that they ought to have been disclosed. I find as fact, that he did not knowingly make a false statement regarding the HTA matters in his application.

WITHDRAWN CRIMINAL CHARGES

17In 2008, when the Applicant was 18 years old, he had several criminal charges, including under s. 355(b) of Criminal Code (the “Code”), Possession of Property Obtained by Crime Under $5,000. This charge was withdrawn. The Applicant did not disclose this withdrawn charge in his application.

18In 2014, the Applicant was changed under with Aggravated Assault under s. 268 of the Code. This charge was withdrawn. The Applicant did not disclose this withdrawn charge in his application.

19In 2020, the Applicant was again subject to criminal charges, including under s. 56.1(4) and s. 355(a) of the Code, Identity Theft and Proceeds of Crime Over $5,000 and s. 5(1)(1) of the Controlled Drugs and Substances Act (“CDSA”), Trafficking Cocaine. These charges were withdrawn.

20In his testimony and under cross examination, the Applicant maintained that he did not attempt to hide any of his past. He testified that he disclosed his convictions. In his application for the 2008 matters he wrote “Trafficking a Controlled Substance. (Can get more specific information if needed).” He disclosed that this took place in Hamilton and erroneously made a typographical error in putting the date as “20085”, instead of “2008”.

21In his application for the 2020 matters he wrote “Trafficking in a controlled substance (can get more specific information if needed).

Possession of Property Obtained by Crime Under $5,000 – 2008

22The Applicant disclosed his criminal conviction from 2008, as part of his application process. He specifically mentioned “Can get more specific information if needed.” He explicitly offered to provide further details if the Registrar wanted greater clarity, or specificity. I find as fact, that he did not knowingly make a false statement with respect to this criminal charge, in his application.

Aggravated Assault – 2014

23The Applicant did not disclosure the fact that he was criminally charged in 2014 in his application. He testified that since the charge was later withdrawn, that he did not realize this was required. He further testified that he was not attempting to evade anything and had in fact disclosed his convictions in a forthright manner. I find as fact, that he did not knowingly make a false statement with respect to this criminal charge, in his application.

Identity Theft and Possession of Drivers Licences and Health Cards - 2020

24In testimony, the Applicant acknowledged that when he was apprehended by police in June 2020, that he was in possession of close to 100 driver’s licenses and health cards. His uncontradicted testimony was that these were not being used for any nefarious purposes, such as identity theft, rather they were more akin to “trophies” from his time working as a bouncer, when people were using fake IDs. He used many of them to essentially decorate a coffee table. The Applicant openly admitted that this was an incredibly stupid thing to have done. I find as fact that the possession of these identification was not for any criminal purpose but was as the Applicant stated: a series of juvenile souvenirs from his time working as security for various licenced establishments.

25Although this charge was not disclosed, the Application did disclose his conviction as discussed below. He also offered to provide further details if the Registrar wanted greater clarity, or specificity. I find as fact, that he did not knowingly make a false statement with respect to this criminal charge, in his application.

Possession of the Proceeds of Crime and Drug Paraphernalia - 2020

26When the Applicant was arrested in June 2020, the police recovered over $35,000 in cash, over 40 grams of cocaine, as well as various paraphernalia related to the drug trade, such as a sensitive digital scale, as well as zip-lock bags with drug residue. In examination in chief, although the related charge was withdrawn, the Applicant conceded that the money was in fact the proceeds he obtained from selling cocaine and that the various paraphernalia were the “tools of the trade”. At no point was he evasive.

27For the 2020 conviction he wrote “Trafficking in a controlled substance (can get more specific information if needed).

28Throughout his testimony and intense cross-examination, the Applicant was forthright about his misunderstanding the questions that were asked on the application and that he specifically put down that he could provide “more specific information if needed”. I find as fact, that the Applicant did not knowingly make a false statement in his application with respect to any of the withdrawn charges under either the Code of the CDSA.

The Applicant’s Criminal Convictions

29The Applicant had two significant criminal convictions. The first stems from June 2008, when he was 18 years old. He was charged with and convicted under s. 4(1) and s. 5(2) of the CDSA, for both Possession of a Schedule II Substance, as well as Possession of a Schedule II Substance for the Purpose of Trafficking. The Applicant was given a suspended sentence and probation for 18 months, on each charge, to be served concurrently.

30The Applicant’s second conviction stems from June 2020. The Applicant was changed with and convicted under s. 5(2) of the CDSA, Possession of Cocaine, for the Purposes of Trafficking. In January, 2023, the Applicant was sentenced to 18 months of imprisonment.

31The Applicant was forthright in terms of his past misconduct and accepted responsibility for his incarceration.

Parole

32In May 2023, the Applicant was released from prison on parole. The Applicant called his Parole Officer, Nanette Rodrigues as a witness to his character. Ms. Rodrigues testified that since his release from custody, the Applicant had never missed a parole meeting.

33Under cross examination, Ms. Rodrigues conceded that at the time of his hearing, she opposed the Applicant’s being granted parole. She further testified that notwithstanding that the Applicant had not missed an appointment, she still did not support his parole.

34At the time of the hearing, the Applicant had not yet finished his sentence, and was still on parole. His parole was set to end on December 6th, 2023.

CARRYING ON BUSINESS IN ACCORDANCE WITH THE LAW AND WITH INTEGRITY AND HONESTY

35If the Registrar has reasonable grounds for belief that the Applicant will not carry on business in accordance with the law and with integrity and honesty, then he is not eligible to be a licensee.

36The facts in this matter are not in dispute. The question is whether there is a nexus between the Applicant’s past conduct and his ability to carry on the business as a licensee in accordance with the law and with honesty and integrity.

37I do not have significant concerns, with respect to the Applicant’s first criminal conviction for drug trafficking. The offense took place when in 2008, when he was 18 years old.

38However, I am very concerned about his most recent conviction. In Goddard (Re), [2005] O.L.A.T.D. No. 50, the Tribunal quoted with approval the decision in Mavroudis (Re) [1998] O.C.R.A.T.D. No. 119 where it stated that in circumstances “where past conduct included criminal convictions, generally, unless exceptional circumstances exist, no registration will be permitted until some time after the sentence has been served and parole or probation have been completed; then a period of reformation has been exhibited.” I find that recent serious criminal activity for monetary gain in relation to controlled substances has a sufficient nexus the honesty and integrity of carrying on a business in accordance with the law.

39In the present case, the Applicant had been sentenced to 18 months of imprisonment in January 2023. At the time of the end of the hearing, he was still under parole. This application is premature and ill-timed. There has not been enough passage of time to provide positive evidence of his present conduct, as it relates to honesty and integrity and his ability and willingness to act in accordance with the law.

Transfer of the Licence

40In submissions, counsel for the Appellant proposed that if the Notice of Proposal to Refuse to Transfer a Licence (“NOP”) was upheld, that in the alternative, the Tribunal should order that the Registrar allow the licence to be transferred to the Applicant’s sister, Ms. Berkby.

41Counsel is to be commended for her creativity in proposing a solution that on first glance could address the Applicant’s ineligibility. From the perspective of the Applicant, allowing the licence to be transferred to his sister would allow him the opportunity to continue to have gainful employment at Echo. The Applicant testified at length about his involvement in bowling, both recreationally and competitively since he was a child. He spoke with passion and sincerity about his love for the sport, in particular for the Canadian-invented 5 pin bowling.

42However, the “presumably” raises fresh issues. Since Ms. Berkby never filed an application with the Registrar, they never had the opportunity to determine the suitability of Ms. Berkby.

43Nothing in this decision and order prevent Ms. Berkby from making an application to the Registrar for a transfer of the licence, nor, if the transfer is refused, is there anything from precluding her from appealing the decision to this Tribunal. However, this issue is not properly before me and cannot be considered.

CONCLUSIONS

44Having considered the evidence and submissions of the parties, for the reasons above, I find that the Registrar has reasonable grounds to believe that the Applicant will not carry on business in accordance with the law and with integrity and honesty. However, I do not find that the Applicant made a false statement, nor that he provided false information in his application. I find that the Applicant acted in good faith throughout his application, as well as during the hearing. The Applicant is free to reapply for a transfer of the licence in two years and is encouraged to do so with appropriate documentation to demonstrate that he is eligible.

ORDER

45I direct the Registrar to carry out the proposal to refuse to transfer the licence to the Applicant.