Tribunals Ontario

Licence Appeal Tribunal

Tribunaux décisionnels Ontario

Tribunal d'appel en matière de permis

An appeal under Section 50(1) of the Highway Traffic Act, R.S.O 1990, c. H.8 (the “Act”), from a Cancellation and Seizure Order of the Registrar of Motor Vehicles under sections 47 and 47.1 of the Act

Between:

11473506 Canada Inc.

Appellant

and

Registrar of Motor Vehicles

Respondent

DECISION AND ORDER

ADJUDICATOR: Jeffery Campbell, Vice-Chair

APPEARANCES:

For the Appellant: Robert Weafer, Paralegal

Rassam Rafigh, Director of the Appellant

For the Respondent: Patrick Moore, Counsel

Britney Wilkins, Representative

Reporter: Kelli Ryan

Heard by Videoconference: April 9 & 10, 2024

REASONS FOR DECISION AND ORDER

BACKGROUND

1The Appellant appeals to this Tribunal under s. 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 pursuant to s. 47(1) of the Act on November 22, 2023 to cancel the Commercial Vehicle Operator’s Registration (“CVOR”) certificate and vehicle registrations and to seize the plate portion of any permits and number plates registered in the name of the Appellant.

2The Registrar alleges that there is reason to believe that the Appellant will not operate a commercial motor vehicle safely or in accordance with the Act, the regulations and any other laws relating to highway safety. The Registrar bears the onus of convincing the Tribunal that there is reason for such belief.

3The Appellant appealed the order to the Tribunal pursuant to s. 50(1) of the Act. Section 50(1) provides the right of appeal to this Tribunal and s. 50(2) allows the Tribunal to confirm, modify or set aside the decision of the Registrar.

ISSUES

4The issues before me are:

(a) Is there reason to believe, having regard to the safety record of the Appellant or of a person related to the Appellant, and any other relevant information, 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?

(b) If the answer to the first issue is yes, what is the appropriate outcome?

RESULT

5For the reasons that follow, I find:

(a) There is reason to believe 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,

(b) Having considered the parties’ submissions, this is not an appropriate case for conditions. I therefore confirm the Registrar’s order to cancel the Appellant’s CVOR certificate and vehicle registrations and to seize the plate portion of permits and number plates for all commercial motor vehicles registered in the name of the Appellant.

LAW

6Under s. 47(1) of the Act, the Registrar may, by order, suspend or cancel a CVOR certificate and the plate portion of a permit if the Registrar has 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 the Act, the regulations and other laws relating to highway safety.

7Section 17(4) of the Act provides that an applicant is related to a person if at least one of the following is established:

(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.

8Section 47(2.1) of the Act provides that s. 17(4) applies with necessary modifications for the purpose of determining who are related persons for the purposes of s. 47(1)(f).

9The Registrar and the Tribunal are required under s. 47(1)(f) to have regard to the safety record of the Appellant when determining whether the Appellant’s CVOR certificate ought to be cancelled. The Tribunal owes no deference to the Registrar in arriving at its decision.

10According to the Court of Appeal in Registrar, Alcohol and Gaming Commission of Ontario v. 751809 Ontario Inc. operating as Famous Flesh Gordon’s, 2013 ONCA 157, the issue is whether those facts afford reasonable grounds for belief that the business will not be carried on in accordance with the law and with integrity and honesty.

11The “reasonable grounds to believe” standard requires something more than mere suspicion but less than proof on a balance of probabilities. In other words, the Registrar does not have to show that the conduct of the Appellant makes it more likely than not that they will not carry on business as required. The Registrar need only show that there are reasonable grounds for belief that they will not operate a commercial motor vehicle safely or in accordance with the Act.

12According to the Supreme Court of Canada in Mugesera v. Canada (Minister of Citizenship and Immigration), 2005 SCC 40 at para. 114, reasonable grounds for belief must be more than mere suspicion, and will be found to exist where there is an objective basis for the belief which is based on compelling and credible information.

13Further, there must be a nexus between the past conduct in issue and the Appellant’s ability to operate a commercial motor vehicle safely: see CS v Registrar, Real Estate and Business Brokers Act, 2002, 2019 ONSC 1652 (Div. Ct.) at para. 32.

EVIDENCE AND ANALYSIS

14Ms. Britney Wilkins, Senior Program Administrator for the Ministry of Transportation (“Ms. Wilkins”) testified on behalf of the respondent.

15Ms. Wilkins submitted and presented evidence that shows that, upon receiving an application for a Commercial Vehicle Operator’s Registration (CVOR) Certificate from the Appellant, the Ministry of Transportation (the “MTO”) issued a Notice to Refuse CVOR Certificate dated November 5, 2020, noting the reasons for refusal as the safety record of an alleged related company, 2570746 Ontario Ltd.

16Ms. Wilkins presented evidence that Rassam Rafigh is the director of the Appellant and that his father, Homayoon Rafigh, was the director of 2570746 Ontario Ltd. and was involved in the operations and management of the Appellant.

17On November 11, 2020, Rassam Rafigh sent a response to the Notice to Refuse to the MTO. In that letter Rassam Rafigh, though not expressly, alluded to the prospect that he will not involve his father in the operation of the Appellant. He further stated that he would not hire any drivers under the age of 25 and added that he would agree to a probationary period for the Appellant of 6 months to 1 year if approved for a CVOR certificate.

18On December 7, 2020, the Registrar issued a CVOR certificate to the Appellant on the conditions that the certificate may be subject to cancellation if the Appellant had an overall safety violation rate exceeding 50% for one year commencing December 8, 2020 and if it had any affiliation or association directly or indirectly with 2570746 Ontario Ltd.

19Ms. Wilkins testified that on February 22, 2021, a Notice of Cancellation and Seizure was issued to both the Appellant and 2570746 Ontario Ltd. based 2570746 Ontario Ltd.’s safety record and the Appellant’s relationship to 2570746 Ontario Ltd. Following a Show Cause Meeting dated March 15, 2021, an Action Plan was formulated for the Appellant. This was signed by Rassam Rafigh on April 9, 2021.

20In the Action Plan of April 9, 2021, Rassam Rafigh undertook that “there will be absolutely no connection or association moving forward with my father’s company”. He also undertook to strictly enforce and adhere to a minimum age requirement of 25 for any drivers.

21Also pursuant to the Show Cause Meeting of March 15, 2021, on April 30, 2021, the MTO issued a Fleet Limitation Order to the Appellant limiting it to a fleet of one commercial vehicle for the period of 2 years commencing on the date of the registration of that vehicle (which date was November 4, 2021). Also in that order were conditions that the Appellant’s certificate may subject to cancellation if the Appellant had an overall safety violation rate exceeding 50% for one year commencing on the date of the registration of the commercial vehicle, if they had any affiliation or association directly or indirectly with 2570746 Ontario Ltd., and if they do not implement and monitor the undertakings of the Action Plan of April 9, 2021.

22Ms. Wilkins testified that on September 6, 2023, a Notice of Cancellation and Seizure was issued to the Appellant based on a Safety Record review of September 2023, a Commercial Vehicle Operating Record, Collision Reports and the failure to meet the performance conditions on the Fleet Limitation Order.

23In support of that Notice of Cancellation and Seizure, Ms. Wilkins presented a Carrier Safety Record Review dated September 1, 2023 which revealed, among other items, the following:

(a) The overall safety violation rate of the Appellant was 30.32%;

(b) Homayoon Rafigh was a driver in a collision involving an Appellant company truck on January 4, 2023. Homayoon Rafigh was also the driver listed in inspections on December 6, 2022 and April 5, 2023;

(c) The Appellant had been operating two commercial vehicles, which was not permitted under the Fleet Limitation Order;

(d) One driver of a commercial vehicle was 23 years of age, contravening the terms of the Action Plan of April 9, 2021.

24Also in support of the Notice of Cancellation and Seizure, Ms. Wilkins presented a Motor Vehicle Collision Report dated January 4, 2023 which shows that, on that date, a commercial vehicle owned by the Appellant and driven by Homayoon Rafigh struck 2 pedestrians at 12:28 p.m.

25A Show Cause Meeting occurred on September 20, 2023. As a result of that meeting, the Appellant provided a Safety Action Plan (“SAP”) dated October 30, 2023, produced by Nickerson CVOR Consultants. The SAP listed 19 Action Steps to be taken by the Appellant.

26Bill Nickerson of Nickerson CVOR Consultants testified at the request of the Appellant. Mr. Nickerson testified that the SAP was produced in order to address the concerns of the Show Cause meeting of September 20. He testified that, although he had not met with Rassam Rafigh in person, they communicated via phone and email.

27In his testimony, Mr. Nickerson went through the SAP which shows that 7 of the 19 Action Steps had been completed as of the date of this hearing, including, among other items, the removal of Homayoon Rafigh as a director on October 27, 2023, and the creation of a Hiring Policy.

28Mr. Nickerson testified that the Appellant had not completed some actions steps such as defensive driving course for drivers, reviewing the needs for training for new and existing drivers and developing a discipline policy for drivers. Mr. Nickerson testified that the Appellant was not wanting to incur the costs of completing those steps prior to the determination of the Tribunal.

29Rassam Rafigh also testified on behalf of the Appellant. With respect to Homayoon Rafigh, he testified that the only relationship between Homayoon Rafigh and himself is that of father and son. He testified that his father is retired and he does no business with him.

30With respect to the Cancelation and Seizure Order of November 22, 2023, the respondent submits that there is reason to believe 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 based upon the following:

(a) the Appellant’s overall violation rate;

(b) the Appellant breached the terms of the Action Plan of April 9, 2021 and

(c) the Appellant breached the Fleet Limitation order of April 30, 2021.

1. Overall Violation Rate

31The respondent presented evidence that, in the past three years, the Appellant’s overall violation rate had increased from 24.92% for the 24-month period ending July 30, 2023 to 30.32% for the 24 month period ending August 7, 2023 to 41.4% in March 2024.

32The Appellant submits that its violation rate is still in a lower percentile and does not rise to the level of a reasonable belief that the Appellant will not operate safely.

33I agree with the Appellant in this regard. While the increase of the Appellant’s overall violation rate is of definite concern, I do not find that it, in itself, establishes 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.

2. Action Plan of April 9, 2021

34In the Action Plan of April 9, 2021 the Appellant undertook that it not have any connection or association with 2570746 Ontario Ltd., have a minimum age for drivers of 25, and that the Appellant have a vehicle tracking system in place.

A. Related Company

35The Registrar submits that the Appellant is related to 2570746 Ontario Ltd., a company with CVOR certificate # 191-373-404.

36With respect to the Appellant, Ms. Wilkins submitted the certificate of incorporation dated June 19, 2019 which shows Rassam Rafigh as the sole director. However, also submitted was a Changes Regarding Directors form dated October 12, 2022 which listed Homayoun Rafigh as a director of the Appellant starting June 19, 2019 (the date of incorporation).

37Regarding 2570746 Ontario Ltd., Ms. Wilkins presented a corporate profile report generated February 20, 2024 which shows Homayoon Rafigh as the sole officer and director of 2570746 Ontario Ltd.

38The respondent also submitted a Form 22 Annual Return for the Appellant company dated May 15, 2023, signed by Homayoon Rafigh. It further submitted a Changes Regarding Directors dated October 27, 2023 which noted the removal of Homayoon Rafigh as a director of the Appellant.

39Ms. Wilkins presented the following further evidence, which she testified shows that the Appellant and 2570746 Ontario Ltd. are related companies:

a. The Corporate Profile Reports of both companies list the same registered or head office addresses;

b. The Corporate Profile Reports of both companies show identical or similar active business names;

c. A comparison of the Commercial Vehicle Operator Record of the related company dated November 3, 2020 and the Commercial Vehicle Operator Record of the Appellant dated August 29, 2023, show similar drivers, one of which being Homayoun Rafigh.

40Ms. Wilkins submits that the directorship of Homayoon Rafigh of both the Appellant and 2570746 Ontario Ltd. establishes that the two companies are, indeed, related. Ms. Wilkins also presented evidence that shows that Homayoon Rafigh has driven vehicles for the Appellant.

41The Appellant submits that the only relationship between the Appellant and 2570746 Ontario Ltd. is that Homayoon Rafigh is his father of Rassam Rafigh. Rassam Rafigh testified that his father did not drive for him; however, he later testified that his father stopped driving for the Appellant after a collision incident on January 4, 2023.

42The Appellant submitted an affidavit signed by Rassam Rafigh dated October 30, 2023, in which it states that the only relationship between Rassam Rafigh and Homayoon Rafigh is that of father and son. It also states that Homayoon Rafigh “does not drive any vehicles or tow trucks for me [the Appellant company] any longer as of August 31, 2023.”

43The Appellant also submitted an affidavit signed by Homayoon Rafigh, dated October 30, 2023. In the affidavit, Homayoon Rafigh states that “assistance with Rassam's business is limited to helping out in the shop and in the office” and “I do not drive any vehicles or tow trucks for him any longer as of August 31st, 2023.”

44I find the Appellant’s evidence, including that coming from Rassam and Homayoon Rafigh, contradictory and less than credible. It is clear from the evidence presented by the respondent that Homayoon Rafigh was not only a driver for the Appellant, but also a director of the Appellant since the date of incorporation until October 27, 2023. It is also apparent from the identical addresses, some identical drivers and similar business names that there exists a definite relationship between the two companies.

45I am satisfied by the above evidence that the Appellant company and 2570746 Ontario Ltd. are related companies pursuant to s. 17(4) of the Act. I also find that the Appellant is in breach of the Action Plan of April 9, 2021 in this regard.

46With respect to the safety record of 2570746 Ontario Ltd., Ms. Wilkins testified that CVOR certificate holders are assigned percentage violation rates based upon a metrics of collisions, convictions, inspections and facility audit. A process of combining these violation rates results in an overall violation rate of the certificate holder.

47Ms. Wilkins presented a violation rate statistics chart as of April 2023 which revealed the violation rates of the total CVOR certificate holders in Ontario:

Violation Rate Percentage (%)

Number of CVOR Holders

Percentage of Total (5)

0 - <35%

60,160

98.39

35 - <50%

631

1.03

50 - <70%

249

0.41

70 - < 85%

44

0.07

85 - < 100%

25

0.04

≥ = 100%

34

0.05

48The respondent presented a Commercial Vehicle Operator Interview Sheet of 2570746 Ontario Ltd. dated January 11, 2020, which reveals its violation rate of 87.65% for the period of October 20, 2018 to October 19, 2020. It also presented a Commercial Vehicle Operator Record of 2570746 Ontario Ltd. dated November 3, 2020 which shows its overall violation rate at 79.65%. It further submitted a Carrier Safety Record Review of 2570746 Ontario Ltd. dated February 2, 2021 which shows that the overall safety violation rate of 2570746 Ontario Ltd. had increased to 105.93%.

49As a result of the high and increasing violation rate of 2570746 Ontario Ltd., the Registrar issued a Cancellation and Seizure Order dated April 30, 2021 for its CVOR certificate, which was cancelled on May 13, 2021. 2570746 Ontario Ltd. did not appeal that cancellation order.

50The safety record of 2570746 Ontario Ltd. and the continual closeness of the relationship between it and the Appellant until only after the Show Cause Meeting is problematic. It is clear from the evidence that Hoomayoun Rafigh has had constant involvement in the Appellant’s management and I am not satisfied that he will not continue to do so. I find that, with this continued influence, combined with the past safety record of 2570746 Ontario Ltd. and the increasing violation rate of the Appellant, it is reasonable to believe 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.

B. Age requirement of 25

51Secondly, the respondent submits that the Appellant failed in its undertaking in the Action Plan of April 9, 2021 in that it failed to not hire any drivers under the age of 25.

52The respondent presented an Inspection Record dated August 8, 2023, which showed Suleman Asim as the driver of a commercial vehicle belonging to the Appellant. Mr. Asim was 23 years of age.

53In his testimony, Rassam Rafigh stated that he thought that the driver was “around 30” and that he forgot that the stipulation to not have any driver under the age of 25 was part of the Appellant’s undertaking to the Registrar.

54I find that the Appellant’s evidence on this matter to be unconvincing. As the principal of the Appellant who employed Mr. Asim, Rassam Rafigh would have been able to ascertain the age of Mr. Asim simply by inspecting his driver’s abstract, a very basic requirement in the hiring process of a driver. I find that the Appellant breached the Action Plan of April 9, 2021 due to its failure to ensure a minimum age of 25 for drivers.

C. Vehicle tracking system

55Thirdly, the respondent submits that the Appellant breached the conditions in the Action Plan of April 9, 2021 by not implementing a vehicle tracking system.

56In the Action Plan the Appellant stated that they had “set up a vehicle tracking system...to monitor any and all movements of future fleets”.

57The respondent submits that there is no evidence that this has been implemented.

58In cross-examination, the Appellant testified that he did not need the vehicle tracking system.

59I find that the non-implementation of the vehicle tracking system is a breach of the Acton Plan of April 9, 2021. Further, the statement in that Action Plan that he had already “set up the tracking system” was less than truthful.

3. Fleet Limitation order of April 30, 2021

60The respondent submits that the Appellant breached the fleet limitation order of April 30, 2021.

61As noted, the Registrar issued a Fleet Limitation Order to the Appellant limiting that company to a fleet of one commercial vehicle for the period of 2 years commencing on the date of the registration of that vehicle, that being November 4, 2021.

62The respondent presented a Fleet Limitation Certificate which authorized the vehicle with VIN number 1GB3CYC89GF114773 as the one vehicle that the Appellant would be permitted to operate from November 5, 2021 to November 5, 2023.

63The respondent submitted a Commercial Vehicle Inspection Report dated April 5, 2023 which revealed a vehicle owned by the Appellant driven with the VIN 1GD9TEY5NF346956 and another Inspection Report of the same date with the VIN 1GD49TEY7NF249998. A further Inspection Report dated July 5, 2023 revealed a vehicle owned by the Appellant with VIN 1GB4YTEYPF166960.

64Rassam Rafigh testified that those vehicles may have been used in his car and truck rental business, which is under the same corporate identity of the Appellant. Neither Rassam Rafigh nor his employees would drive those vehicles. Rather, the renters of those vehicles would drive them. Rassam Rafigh testified that it was his belief that if he or his drivers did not drive the vehicles, the Appellant would not be in breach of the Fleet Limitation Order.

65The respondent submits that the Fleet Limitation Order relates to vehicles registered in the name of the Appellant, whether they drive them or not.

66I agree with the respondent. The Fleet Limitation Order specifically assigned the VIN of the one vehicle which the Appellant was permitted to have registered. I find that the other three vehicles were in clear breach of the Fleet Limitation Order.

67I find that the Appellant breached the Fleet Limitation Order.

Conclusion

68I have concluded that the Appellant is related to 2570746 Ontario Ltd. By operation of ss. 17(4) and 47(2.1) of the Act, I may consider the safety record of 2570746 Ontario Ltd. when evaluating the Appellant. 2570746 Ontario Ltd’s safety record was of such its CVOR certificate was cancelled by the Registrar. I find that, from the date of incorporation, the Appellant has been less than forthcoming in its relationship with the related company and there is little evidence to suggest that it will not continue to be less than forthcoming in the future. This is exacerbated by the less than convincing evidence from both father and son presented at the hearing. This, along with the breaches of the Action Plan of April 9, 2021 (the minimum age limitation and the vehicle tracking system), as well as the breaches of the Fleet Limitation Order lead me to find that the respondent has established that there reason to believe, having regard to the safety record of the Appellant or of a person related to the Appellant, and any other relevant information, 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.

What is the appropriate sanction?

69I am not bound to accept the outcome proposed by the respondent. I find, however, that it is appropriate in the circumstances. The Appellant has not established that other sanctions would sufficiently protect public safety or that the Appellant can be trusted to comply with conditions placed on registration.

70The Appellant was initially issued its CVOR certificate partly on the strength of its representation to the Registrar that it not have any relationship with 2570746 Ontario Ltd. It breached that representation. It then was allowed to continue its registration on the basis of the same undertaking in the Action Plan of April 9, 2021. The evidence established that it, again, breached that undertaking. It also breached the Fleet Limitation Order of April 30, 2021. Following the Notice of Cancellation and Seizure Order of September 7, 2023 and the subsequent Show Cause Meeting of September 20, 2023, the Appellant commissioned a Safety Action Plan, the majority of which has yet to implemented. Based upon the Appellant’s past history of breaches and the current inaction with respect to the Safety Action Plan, I find no reason to conclude that conditions would significantly alter the Appellant’s pattern of behaviour.

ORDER

70Pursuant to s. 50(2) of the Act, the Tribunal confirms the Registrar’s order to cancel the Appellant’s CVOR certificate and vehicle registrations and to seize the plate portion of permits and number plates for all commercial motor vehicles and trailers registered to the Appellant.

Licence Appeal Tribunal

Jeffery Campbell, Vice-Chair