Licence Appeal Tribunal File Number: 16773/TSSEA

In the matter of an appeal from a suspension order issued under section 7 of the Towing and Vehicle Storage Safety and Enforcement Act, 2021, S.O. 2021, Sched 3, (the “Act”).

Between:

Ward’s Towing Service Ltd

Appellant

and

Director of Towing and Vehicle Storage Standards

Respondent

MOTION DECISION

ADJUDICATOR:

Bruce Stanton

APPEARANCES:

For the Appellant:

Randy Whan, President

Gabriel Gross-Stein, Counsel

For the Respondent:

Patrick Moore, Counsel

Heard by videoconference:

March 7, 2025

OVERVIEW

1Ward’s Towing Service Ltd, the appellant, appeals from a 30-day suspension of its Tow Operator Certificate and Vehicle Storage Certificates issued by the Director of Towing and Vehicle Storage Standards (the “respondent” or “Director”) on February 24, 2025. The suspension was ordered to take effect March 10, 2025 at 12:00 a.m.

2On February 27, 2025, the appellant filed a Notice of Appeal of the suspension order with the Licence Appeal Tribunal (“Tribunal”).

3On March 3, 2025, the appellant filed a Notice of Motion requesting that the Tribunal order a stay of the suspension pending the outcome of the appeal.

4On March 5, 2025, the parties reached agreement on the conditions under which the respondent would consent to the appellant’s motion and filed a copy of their resolution with the Tribunal.

5Notwithstanding the parties’ consent to the conditions, on March 6, 2025, the Tribunal directed the parties to attend a hearing on the motion at which they should be prepared to present submissions on the grounds for granting a stay.

6On March 7, 2025 I granted a stay of the suspension order orally, with immediate effect, with written reasons to follow.

ISSUE

7The issue to be decided is:

a) Whether, pursuant to section 37(3) of O. Reg. 167/23 (the “Regulation”) under the Act, the Tribunal should order a stay of the suspension order pending the outcome of a hearing.

RESULT

8A stay of the suspension order is granted, effective March 7, 2025.

REASONS and ANALYSIS

Legal test to order a stay

9Section 37(3) of the Regulation stipulates that filing an appeal on a suspension order issued under the Act does not stay the decision unless the Tribunal orders otherwise. In other words, the suspension begins on the day indicated in the suspension order, in this case, March 10, 2025, unless the Tribunal orders a stay.

10It is well established that the 1994 Supreme Court decision in RJR-MacDonald Inc. v. Canada (Attorney General), [1994] 1 SCR 311, 1994 CanLII 117 (“RJR-MacDonald”) is the test to be applied in motions seeking interlocutory relief, i.e. a stay pending a hearing on the appeal. The party seeking the stay must prove, on a balance of probabilities, that:

a) the appeal raises a serious issue to be tried;

b) the applicant will suffer irreparable harm if the stay is not granted; and

c) the balance of convenience favours granting a stay.

11No one criteria of the three is determinative; they must be considered cumulatively on the question of whether the justice of the case merits or does not merit a stay.

12The respondent submits that the RJR-MacDonald test does not apply in this case because the parties have consented to the terms and conditions by which a stay should be ordered.

Does the parties’ consent for a stay waive the necessity of the Tribunal’s consideration the RJR-MacDonald test or any other grounds for granting a stay?

13The respondent submits that the parties’ consent to the conditions for a stay provides a sufficient basis for the Tribunal to order a stay. It does not need to consider the grounds for ordering or granting a stay.

14The respondent submits that it is the Director’s suspension order that is the basis of the appeal, and the Director has agreed to the terms and conditions by which a stay can be granted. Therefore, the Tribunal should order a stay based on the parties’ consent to those conditions.

15The respondent referred me to circumstances in civil and criminal matters before the court where interlocutory relief was sought and submits that consent of the parties is typically all the court requires to issue such an order.

16The respondent argues that section 37(3) is not prescriptive. It does not require the Tribunal to establish grounds, receive any evidence, or make any finding upon which a stay order is granted.

17The respondent referred me to section 4.1 of the Statutory Powers Procedure Act, R.S.O. 1990, c. S.22 (the “SPPA”) which provides that, the Tribunal may decide to dispose of a proceeding without a hearing if the parties consent. It also referred me to section 16.1(3) of the SPPA which stipulates that a tribunal may make interim orders and decisions in a matter that need not be accompanied by reasons.

18The appellant did not make submissions on the applicability of the RJR-MacDonald test. In fact, the appellant framed its reasons for the Notice of Motion, appended in Schedule A of the Notice of Motion, on the RJR-MacDonald test.

19I find that the Tribunal may determine its own process and procedure to reach a decision on this motion regardless of the parties’ consent to the terms and conditions of a stay.

20Section 37(3) of the Regulation clearly articulates that the Tribunal must decide to grant a stay, otherwise the effective date on the suspension order applies. In my view, the criteria to be considered when granting a stay is set out in the RJR-MacDonald case. The respondent has presented no authority for the proposition that a consent of the parties is sufficient to satisfy the test in RJR-MacDonald or that the test in RJR-MacDonald does not apply where the parties consent to a stay. The Tribunal was created as an adjudicative body that is independent of any disputing party yet promotes the objectives of the subject legislation. Had the Legislature intended otherwise, then there would be no need for s. 37(3).

21Section 4.1 of SPPA clearly permits the Tribunal to dispose of a proceeding without a hearing if the parties consent, but the question here is on whether the Tribunal should order a stay of the suspension order that is the subject of the matter before it.

22The question of granting a stay under s. 37(3) is only one aspect of the proceeding that is before the Tribunal.

23It appears that the respondent is interpreting “proceeding” to apply equally to this discrete, interim component of the appellant’s appeal in this matter. I disagree. I take the meaning of “proceeding” in section 4.1 as it is defined in subsection 1(1), “a proceeding to which this Act applies”, in this case the appeal of the suspension order under section 7 of the Act.

24I am not persuaded by the respondent’s submission that section 4.1 of the SPPA permits the Tribunal to dispose of a decision under section 37(3) of the Regulation purely on the bases of the parties’ consent, because the consideration of a stay is under the Regulation and is only one component part of the overall proceeding.

25Even if the word “proceeding” was properly understood to include a discrete, interim component of the appeal such as seeking an order for a stay pending an appeal, s. 4.1 of the SPPA uses the permissive “may,” and therefore does not compel the Tribunal to dispose of a proceeding without a hearing if the parties consent.

26While s. 16.1(3) of the SPPA provides that an interim order need not be accompanied by reasons, that does not mean that a tribunal can make interim decisions without having any reasons for those decisions, or on the basis or reasons which are not in accordance with the law. Section 16.1 means no written reasons are required, not that no reasons, or insufficient reasons would be acceptable.

27I find that the parties’ consent to the terms and conditions of a stay in this matter, while a factor in determining whether the test in RJR-MacDonald has been satisfied, is not determinative and the Tribunal is required to determine whether the test in RJR-MacDonald has been satisfied before issuing a stay.

28I found RJR-MacDonald is the appropriate legal test in this case and the motion hearing proceeded to hear the parties’ submissions on that basis.

Serious issue to be tried

29This first stage is a low threshold. The appellant need not demonstrate the likelihood of succeeding in their appeal, only that the matter before the Tribunal has merit, i.e. it is not frivolous or vexatious.

30The appellant submits that it is a serious issue because it must have an opportunity to challenge the allegations which underpin and inform the respondent’s suspension order.

31In Schedule A of its Notice of Appeal, the appellant described its defence of the alleged infractions in the suspension order. The appellant submits that when the facts are presented, it will be clear that the infractions are without merit or that it has already taken corrective actions to remedy the source of the issue. I find that if the appellant is able to demonstrate the basis of its opposition to the suspension order, there is merit to the appeal and there is a serious issue to be heard.

32The respondent did not make any submissions suggesting that there was no serious legal issue raised by the appellant’s appeal.

Irreparable Harm if stay not granted

33At this stage, the appellant must demonstrate that irreparable harm will result if relief is not granted. “Irreparable” refers to the nature of the harm rather than its magnitude. For example, financial loss could be deemed irreparable if it is unclear how such a loss might be recovered. As noted in the Tribunal’s decision in Amarjot Lamba o/a Whitehill Realty International Inc. v. Registrar, Real Estate and Business Brokers Act, 2002, 2022 CanLII 45261 (ON LAT) (“Lamba”) at paragraph 22, the Supreme Court of Canada in RJR-MacDonald described the harm as that:

“…which either cannot be quantified in monetary terms or which cannot be cured, usually because one party cannot collect damages from the other. Examples… include instances where one party will be put out of business by the court’s decision, … where one party will suffer permanent market loss or irrevocable damage to its business reputation… or where permanent loss of natural resources will be the result when challenged activity isn’t enjoined.”

34Lamba states that evidence of irreparable harm must be clear and not speculative.

35I am not bound by previous decisions of the Tribunal, but I take guidance from Lamba since it describes the court’s application of RJR-MacDonald to the facts and circumstances of the case.

36The appellant submitted that the vast majority of its tow revenues are derived from contracts with the municipality, auto insurance companies, and roadside assistance service companies such as the Canadian Automobile Association (CAA). The appellant submitted that if a stay is not granted those contracts would be terminated and the appellant would be unlikely to have them reinstated following the suspension. It argues that not granting a stay will cause irreparable harm to the sustainability and reputation of the business, and result in the loss of incomes for 19 employees.

37The respondent made no submissions suggesting that the appellant would not suffer irreparable harm if the stay remains in place.

Balance of Convenience

38At this third stage, RJR-MacDonald compels the Tribunal to consider which of the two parties will suffer the greater harm from the granting or refusal of a stay. Put another way, it compels me to consider whether the harm to the appellant from not granting a stay is greater, less than or equal to the harm to the public interest by granting a stay.

39RJR-MacDonald states that when the nature and declared purpose of legislation is to promote the public interest, a motions court must assume it does so and in order to overcome the assumed benefit to the public interest arising from the continued application of the legislation, the applicant who relies on the public interest must demonstrate that the suspension of legislation would, itself, provide a public benefit. For the appellant in this matter, it means demonstrating benefits to the public interest in granting a stay.

40The appellant submitted that it has operated for 16 years and has engaged a safety compliance consultant to help it improve its safety culture and standards throughout the operation. It submitted that the infractions, which are the subject of the suspension order, were not so serious that the Director sought to cancel its certificates. It is only a temporary withdrawal of privileges. It submits that the operational deficiencies can be corrected, and safety performance improved. It submitted that the public interest is served by allowing time for the business to improve its safety performance, retain its employees, and continue to provide services to the motoring public and its customers (insurers, roadside assistance providers, CAA etc.).

41The respondent did not make submissions on this or any of the three stages of the RJR-MacDonald test. Instead, the respondent submitted that the Act exists to ensure tow and vehicle storage operations are conducted with integrity, honesty and in the interest of safety on Ontario roadways. The Director administers the issuing, suspension and revocation of certificates to uphold the purposes of the Act. Therefore, the public interest is served by applying and enforcing the various provisions of the Act and the Regulation, including section 37(3) which stipulates that an appeal to this Tribunal does not stay the Director’s suspension order, unless the Tribunal orders otherwise.

42In its resolution agreeing to the appellant’s motion for a stay, the Director set out a number of conditions upon which the potential harm to the public interest by granting a stay would be mitigated. They require the appellant to:

a) report, within one week, any violations of the Act and its regulations committed by its drivers or employees;

b) comply with conditions on its Tow Operator Certificate from December 18, 2023;

c) ensure that its tow trucks are properly registered; and

d) that its tow truck drivers have the proper credentials and have completed a tow truck driver training course approved by the Ministry by no later than April 30, 2025.

43The respondent submitted if the appellant was found to be non-compliant with the conditions of the parties’ resolution, it would have the option of filing a motion with the Tribunal to rescind the conditions. I pause here to note that a motion to rescind the licence conditions ordered by Tribunal, even if they had been imposed on consent of the parties, again invokes an adjudicative decision that is the prerogative of the Tribunal.

44I find that the appellant has met its burden in demonstrating, on a balance of probabilities, that a stay of the suspension order has merit.

45I find the matter is a serious issue to be tried because it is not frivolous or vexatious and the basis of the appellant’s opposition to the suspension order, if proven, has merit.

46Despite being somewhat speculative, the appellant’s submissions on the irreparable harm subject are persuasive. I find that not granting a stay could raise the potential for business failure. I take notice from the testimony of tow operators previously before this Tribunal, that contracts with roadside assistance providers, municipalities, and automobile insurers in the towing industry are subject to a rigorous, competitive process and that the loss of a tow certificate or commercial vehicle operator’s registration, even temporarily, could put those contracts irredeemably in jeopardy.

47I find the harm to the appellant from not granting a stay is greater than the harm to the public interest by granting a stay because the potential harm to public safety and the integrity of public-facing tow and storage services has been mitigated by the Director’s terms and conditions, and the appellant has begun engagements with safety compliance consultants to improve its safety performance. The balance of convenience favours the granting of a stay in this case.

48Taking the three elements of RJR-MacDonald cumulatively, I find the justice of the case favours granting a stay because there is a serious case to be tried, the appellant has persuaded me of the potential for irreparable harm from not granting a stay, and the balance of convenience favours granting a stay.

Conclusion

49The appellant has demonstrated on a balance of probabilities that a stay should be granted.

ORDER

50A stay of the suspension order is granted pursuant to section 37(3) of the Regulation.