G.B. Cragg Insurance Broker Ltd. v. RIBO, 2011 ONSC 1290
CITATION: G.B. Cragg Insurance Broker Ltd. v. RIBO, 2011 ONSC 1290
DIVISIONAL COURT FILE NO.: 264/10
DATE: 20110309
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
CUNNINGHAM A.C.J.S.CJ., MATLOW and LEDERER JJ.
BETWEEN:
G.B. CRAGG INSURANCE BROKER LTD. and GRAYDON DAVID CRAGG
Appellants
– and –
REGISTERED INSURANCE BROKERS OF ONTARIO
Respondent
Owais Ahmed for the Appellants
John W. Goldsmith for the Respondent
HEARD: February 22, 2011
ENDORSEMENT
THE COURT:
[1] This is an appeal of the decision of the Discipline Committee (“the Committee”) of the Registered Insurance Brokers of Ontario (“RIBO”) dated April 1, 2010.
[2] The decision of the Committee was made following a guilty plea to a number of offences set out in the Notice of Hearing dated January 13, 2010, and a Direction dated November 12, 2009.
[3] Following the guilty plea, and after considering the evidence, the Committee found G.B. Cragg Insurance Broker Ltd. guilty of misconduct for operating in a net trust deficit position on May 31, 2009, and for failing to maintain registered books and records.
[4] The Committee also found Graydon David Cragg guilty of concurring in the misconduct of the brokerage firm. One charge was withdrawn.
[5] The Committee then entered into the penalty phase of the hearing, and after receiving oral and written submissions from counsel, it accepted the recommendations of RIBO with a slight variation in the time set aside to have Mr. Cragg’s Certificate of Registration changed to “unrestricted technical”. This restriction prevented him from operating as a principal broker for two years. Fines were also imposed. During the penalty phase, counsel for the appellants took no issue with RIBO’s penalty submission, except the submission that the company provide audited financial statements for three years and the restriction against Mr. Cragg as a designated individual.
[6] The Committee’s decision was given orally on April 1, 2010. A written decision, along with the orders made, dated April 1, 2010, was sent to Mr. Cragg on April 27, 2010.
[7] RIBO takes the position that its appeal is statute-barred. We agree the Notice of Appeal is out of time. The decision was pronounced April 1, 2010, and the Notice of Appeal was served on RIBO on May 31, 2010. Section 21(1) of the Registered Insurance Brokers Act, R.S.O. 1990, c. R. 19 (“RIB Act”) states:
21(1) Any party to proceedings before the Discipline Committee or the Qualification and Registration Committee may appeal from its decision or order to the Divisional Court.
[8] This broad right of appeal does not prescribe a time by which an appeal to the Divisional Court must be made from a decision of the Committee. In our view, recourse must be had to the Rules of Civil Procedure since the statute is silent.
[9] Rule 61.04(1) of the Rules of Civil Procedure states:
61.04(1) An appeal to an appellate court shall be commenced by serving a notice of appeal (Form 61A) together with the certificate required by subrule 61.05(1), within 30 days after the making of the order appealed from, unless a statute or these rules provide otherwise,
(a) on every party whose interest may be affected by the appeal, subject to subrule (1.1); and
(b) on any person entitled by statute to be heard on the appeal.
(1.1) The notice of appeal and certificate need not be served on,
(a) the defendant who was noted in default; or
(b) a respondent who has not delivered a notice of appearance, unless the respondent was heard at the hearing with leave.
[10] We conclude that s. 61.04(1) does apply as it is clear the Rule contemplated circumstances where a statute provided time limits for appeal. The time for appealing is from the date a judgment is pronounced and not from the date that it is signed and entered. This proposition is based on the settled principle that the binding effect of a judgment or order commences at the date of its pronouncement: Byers (Litigation guardian of) v. Pentex Print Master Industries Inc., 2003 42272 (ON CA), [2003] 62 O.R. (3d) 647 (OCA). Moreover, section 18(7) of the governing statute provides that an order takes effect immediately without regard to whether an appeal is taken. For this reason alone we would dismiss the appeal.
[11] We will, nonetheless, deal briefly with the merits of this appeal. Essentially, that appeal has been reduced to three grounds. First: was the decision of the Committee unreasonable (both parties agree that in this regard the standard of reasonableness applies)? Second: were the reasons, as provided, deficient, such that the decision cannot stand? Third: is the order of the Committee requiring the appellant company to file audited financial statements for three years beyond its jurisdiction?
- Is the decision reasonable?
[12] The appellant argues that the Committee misconstrued the guilty plea. We do not agree. Mr. Cragg’s counsel made it abundantly clear at the time of the plea that Mr. Cragg was pleading guilty to the allegation that the brokerage’s trust account was in a net deficit position on May 31, 2009, and that the plea did not cover the allegations in respect of April 30, 2009, December 31, 2008, and June 30, 2008. The appellant pleaded guilty only to the allegation covering May 31, 2009. The appellant’s plea was supported by the evidence. The evidence established that the appellant’s records were not maintained in accordance with the RIB Act and the regulations. The evidence presented was sufficient for the Committee to find that Mr. Cragg had knowingly concurred in the misconduct. The evidence was uncontroverted and Mr. Cragg pleaded guilty to this aspect of the allegations. Knowingly concurring in the misconduct of a brokerage is a serious infraction warranting significant sanctions. In our view, there was no misconstruing of the guilty plea, nor did the Committee fail to consider key evidence. Whether or not the inclusion of G.I.C.’s was considered in the calculations of the company’s trust position on December 31, 2009, June 30, 2008, and April 30, 2009, is of no significance. The uncontroverted evidence before the Committee was that the company was in a net deficit trust position on May 31, 2009, the date for which the appellants pleaded guilty.
- Were the reasons given deficient?
[13] The appellants submit that procedural fairness dictates that written reasons ought to have been given in this case and that under the Statutory Powers Procedure Act (“the SPPA”) and, at common law, such a requirement exists. Although the parties suggest that the standard of review with respect to procedural fairness is correctness, in our view, there is no standard of review with respect to issues of natural justice such as procedural fairness. The process must be fair.
[14] Reasons for decision are generally required for several reasons, including their facilitating a meaningful appeal. Only brief reasons for decision were given in this case. Nevertheless, it was obvious from the record that the Committee considered that it was desirable to impose on the appellant company a requirement for the filing of audited financial statements in light of its failure to maintain complete and accurate records in the past and the likelihood that, absent such a requirement, it would continue to do so in the future.
[15] This was a sentencing decision following a guilty plea in respect of evidence that could only be characterized as overwhelming. There is no statutory requirement that the written reasons be provided. Section 17(1) of the SPPA simply states that a tribunal is required to give its final decision and order in writing, which the Committee did in this case. If requested, reasons for the decision in writing are to be given. No such request was made in the present case. Indeed, prior to seeking judicial review of a tribunal order on grounds that it failed to give reasons, there is an obligation on the parties seeking review to request reasons from the tribunal: Marine Atlantic Inc. v. Canadian Merchant Service Guild, [2000] F.C.J. No. 1217 (FCA). Moreover, absent a statutory or regulatory requirement, a disposition by an administrative tribunal will not necessarily be reviewable solely by reason of a failure to provide reasons: Northwestern Utilities Ltd. v. Edmonton (City), 1978 17 (SCC), [1979] 1 S.C.R. 684; Elementary Teachers’ Federation of Ontario v. Ontario (Minister of Labour), [2009] O.J. No. 719 (Ont.Div.Ct.).
- Were the Committee’s sanctions beyond their jurisdiction?
[16] It is submitted by the appellants that the Committee exceeded its jurisdiction by imposing upon the appellant company a requirement to file audited financial statements for three years. Section 18(5) of the RIB Act sets out the powers of the Discipline Committee. Furthermore, they argue that this particular sanction is a marked departure from what RIBO has done in the past. At the sentencing phase of the hearing, this issue was debated. In fact, it was the principal issue over which the parties were in conflict. Section 18(5)(c) of the RIB Act states that where the Discipline Committee finds a member guilty of misconduct or incompetence, it may by order,
(c) impose such restrictions on the certificate of the member for such a period and subject to such conditions as the Committee designates. (Emphasis added.)
[17] In our view, the imposition of the requirement to file audited financial statements for three years, in the circumstances of this case, was not only within the sanctions available under section 18(5)(c), but was reasonable and within the range of penalties available. The appellants had previously, in 1990 and 1994, been subject to discipline by the Committee. The contraventions in the present case were serious and required severe sanctions. Each case will be adjudicated on its merits. Penalty is a matter of discretion that should not be lightly set aside. It was not only acknowledged that the appellant company’s books and records were in disarray, but that the appellant, Graydon David Cragg, personally took responsibility.
[18] For the above reasons, this appeal is dismissed. The respondent shall have its costs which we fix at $12,000 all inclusive.
Cunningham A.C.J.S.C.J.
Matlow J.
Lederer J.
Released: March 9, 2011