Voudouris v. Appeal Tribunal of the Certified General Accountants' Association of Ontario et al.

[Indexed as: Voudouris v. Certified General Accountants' Assn. of Ontario]

Ontario Reports

Ontario Superior Court of Justice,

Divisional Court,

Aston, Sachs and Edwards JJ.

April 3, 2014

119 O.R. (3d) 158 | 2014 ONSC 1865

Case Summary

Administrative law — Natural justice — Discipline committee of Certified General Accountants' Association sending request to admit to applicant 11 days after he obtained adjournment of disciplinary proceedings to seek new counsel — Unrepresented applicant failing to respond to request to admit within requisite 20-day period as he was under stress and did not fully appreciate consequences of failing to respond — Applicant promptly retaining counsel and moving unsuccessfully to withdraw deemed admissions upon being advised that discipline hearing would proceed on basis of deemed admissions — Conduct committee's denial of motion unreasonable — Conduct committee breaching natural justice by failing to provide reasons for dismissing motion — Conduct committee also breaching natural justice by not permitting applicant to call evidence to contradict deemed admissions at discipline hearing.

The respondent commenced disciplinary proceedings against the applicant. A hearing date was set. The applicant obtained an adjournment of the hearing as he intended to seek new counsel. Eleven days later, the discipline committee sent a request to admit to the applicant, particularizing 88 facts and identifying 55 documents that the applicant would be deemed to admit the truth and authenticity of if he did not deliver a written dispute within 20 days. The request to admit set out all the facts and documents necessary to convict the applicant of the alleged misconduct. The applicant did not respond to the request to admit within the 20-day period. When advised that the discipline hearing would proceed on the basis of the deemed admissions, the applicant promptly retained counsel and moved to withdraw the admissions. The conduct committee dismissed the motion without giving reasons. At the discipline hearing, the applicant was not permitted to call evidence to contradict the deemed admissions. He was convicted of professional misconduct. The appeal tribunal dismissed his appeal. He brought an application for judicial review of the conviction decision.

Held, the application should be allowed.

The common law test for the withdrawal of admissions applied. The respondents conceded that withdrawal of the admissions raised a triable issue and would not [page159] result in any prejudice to them that could not be compensated for in costs. The applicant was under a great deal of stress when he received the notice to admit and did not fully appreciate the consequences of failing to respond. It was unreasonable for the conduct tribunal to conclude (if it did, in fact, so conclude) that the applicant did not have a reasonable excuse for failing to respond within the 20-day period. The conduct committee breached natural justice by failing to give reasons for dismissing the motion to withdraw the admissions. While s. 16.1(3) of the Statutory Powers Procedure Act, R.S.O. 1990, c. S.22 provides that an interim decision or order need not be accompanied by reasons, in certain circumstances, particularly where the decision is of important significance to the individual, the duty of procedural fairness requires an explanation for the decision. At the discipline hearing, the applicant was denied his right to a full and fair hearing, in circumstances amounting to a breach of natural justice, as a result of the unreasonable decision by the conduct committee to refuse his request to withdraw the deemed admissions. The conviction was quashed, the applicant's motion to withdraw the deemed admissions was granted and the allegations of professional misconduct were remitted to the conduct tribunal for a hearing on the merits.

Baker v. Canada (Minister of Citizenship and Immigration), 1999 699 (SCC), [1999] 2 S.C.R. 817, [1999] S.C.J. No. 39, 174 D.L.R. (4th) 193, 243 N.R. 22, J.E. 99-1412, REJB 1999-13279, 14 Admin. L.R. (3d) 173, 1 Imm. L.R. (3d) 1, 89 A.C.W.S. (3d) 777, apld

Other cases referred to

Kane v. University of British Columbia, 1980 10 (SCC), [1980] 1 S.C.R. 1105, [1980] S.C.J. No. 32, 110 D.L.R. (3d) 311, 31 N.R. 214, [1980] 3 W.W.R. 125, J.E. 80-181, 18 B.C.L.R. 124, 2 A.C.W.S. (2d) 117; Mountain View Farms Ltd. v. McQueen, [2014] O.J. No. 1197, 2014 ONCA 194; Ontario Public Service Employees Union v. Ontario, [2002] O.L.R.D. No. 1338, 83 C.L.R.B.R. (2d) 237, 2002 26026, [2002] OLRB Rep. March/April 176 (Arb. Bd.); Ontario Public Service Employees Union v. Ontario (Management Board of Cabinet), [1996] O.L.R.D. No. 3477, [1996] OLRB Rep. September/October 780, 1996 11200 (Arb. Bd.); Sheet Metal Workers International Assn., Local 30 v. United Brotherhood of Carpenters and Joiners of America, Local 1946, [2010] O.L.R.D. No. 2226, 2010 30906 (Arb. Bd.); Toussaint v. Ontario (Minister of Health and Long Term Care), [2010] O.H.R.T.D. No. 2098, 2010 HRTO 2102

Statutes referred to

Certified General Accountants Act, 2010, S.O. 2010, c. 6, Sch. A

Statutory Powers Procedure Act, R.S.O. 1990, c. S.22, s. 16.1(3)

APPLICATION for judicial review of a decision of the conduct committee convicting the applicant of professional misconduct.

J. Polyzogopoulos and C. MacInnis, for applicant.

L. Braverman, for respondents appeal tribunal and professional conduct tribunal.

K. Jolley, for respondent discipline committee.

The judgment of the court was delivered by

EDWARDS J.: — [page160]

Overview

[1] This is an application for judicial review of the March 6, 2013 decision of the Professional Conduct Tribunal of the Certified General Accountants' Association of Ontario (the "Conduct Tribunal") that convicted the applicant, Peter Voudouris, of professional misconduct.

[2] The Conduct Tribunal convicted Mr. Voudouris solely on the basis of deemed admissions, which the applicant was not permitted to withdraw.

[3] Mr. Voudouris alleges a breach of natural justice. He asks this court to quash the conviction; to permit him to respond to the request to admit, dated July 24, 2012 ("request to admit"); and to remit this matter to a new panel of the Conduct Tribunal for a hearing on the merits.

Background Facts

[4] Mr. Voudouris is a practising certified general accountant and a member of the Certified General Accountants' Association of Ontario ("CGAAO") since 1992.

[5] The CGAAO is established under the Certified General Accountants Act, 2010, S.O. 2010, c. 6, Sch. A (the "Act") and charged with the general purpose of promoting and protecting the public interest.

[6] The CGAAO commenced an investigation against Mr. Voudouris as a result of a complaint from a former client.

[7] Following an investigation, the CGAAO commenced disciplinary proceedings against Mr. Voudouris by notice of hearing dated May 22, 2012. The hearing date was set for July 20, 2012.

[8] On July 13, 2012, Mr. Voudouris contacted counsel for the discipline committee of the CGAAO ("Discipline Committee") and requested an adjournment as he intended to seek new counsel. The matter was adjourned to October 24, 2012.

[9] By letter dated July 24, 2012, the Discipline Committee sent the request to admit to Mr. Voudouris. It particularized 88 facts and identified 55 documents that Mr. Voudouris would be deemed to admit the truth and authenticity of if he did not deliver a written dispute within 20 days. In essence, the request to admit set out all of the facts and documents necessary to convict Mr. Voudouris of the alleged misconduct.

[10] Mr. Voudouris did not respond to the request to admit during the 20-day time period prescribed by the association by-laws, Code of Ethical Principles and Rules of Conduct of the CGAAO ("CGAAO By-laws"), and he was deemed to admit the matters set out in the request to admit ("deemed admissions"). [page161]

[11] On August 31, 2012, Mr. Voudouris received a letter from the Discipline Committee advising that it intended to proceed with the disciplinary proceeding and that it would rely upon the deemed admissions arising out of the request to admit.

[12] On September 3, 2012, Mr. Voudouris made his first contact with new counsel by leaving a voice mail message for him.

[13] On September 21, 2012, more than a month before the scheduled hearing, Mr. Voudouris' new counsel wrote to the Discipline Committee requesting that it consent to withdraw the deemed admissions and to allow him to respond to the request to admit. The Discipline Committee refused the request.

[14] Mr. Voudouris brought a motion before the Conduct Tribunal for leave to withdraw the deemed admissions that was heard on October 24, 2012. The motion was dismissed without reasons on October 30, 2012.

[15] The hearing before the Conduct Tribunal occurred on December 11, 2012. By a written decision dated March 6, 2013, Mr. Voudouris was convicted of professional misconduct solely on the basis of the deemed admissions. No witnesses were called at the hearing; Mr. Voudouris was not permitted to call evidence to contradict the deemed admissions.

[16] The applicant exercised his statutory right of appeal to the Appeal Tribunal of the CGAAO ("Appeal Tribunal"). That appeal was dismissed by reasons dated October 21, 2013.

[17] Mr. Voudouris alleges that he was convicted after a hearing where he was denied the right to natural justice in that he was not permitted to challenge or test in any way the evidence that formed the basis of the deemed admissions. Without challenge, the deemed admissions made his conviction inevitable.

Issue

[18] Was there a breach of natural justice at the hearing before the Conduct Tribunal on the December 11, 2012? To answer this question necessarily involves a consideration of the decision of the Conduct Tribunal in October refusing to allow the applicant to withdraw the admissions he was deemed to have made as a result of his failure to reply to the request to admit.

Standard of Review

[19] The applicant contends that as there was a breach of natural justice, the standard of review does not arise; the proceeding is either fair or it is not.

[20] If a standard of review does apply, the applicant submits that the proper standard in this instance is correctness, [page162] primarily because the issue as to whether the deemed admissions ought to be set aside is a legal question that does not lie within the Conduct Tribunal's expertise.

[21] Even if the standard of review is reasonableness, the applicant submits that the decision to refuse his motion to withdraw the deemed admissions is unreasonable.

[22] Counsel for the Conduct Tribunal and the Appeal Tribunal ("Tribunals") and counsel for the Discipline Committee both argue that there was no breach of natural justice and that the standard of review for a discretionary and procedural decision should be reasonableness.

[23] The assertion of a breach of natural justice requires me to determine whether the hearing before the Conduct Tribunal on December 11, 2012 was procedurally fair or not. If I find that the proceeding was not procedurally fair, it cannot stand and I must then determine the appropriate remedy.

December 11, 2012 Hearing

[24] At the December 11, 2012 hearing, the applicant was precluded from calling evidence to dispute the deemed admissions. This was a denial of the applicant's right to a full and fair hearing that amounted to a breach of natural justice, unless the decision refusing the applicant the right to withdraw the deemed admissions satisfies the appropriate standard of review and was arrived at after a procedurally fair process.

[25] Accordingly, I must address whether the process and the decision that resulted in a restriction on the applicant's right to be heard can withstand scrutiny.

Request To Admit Process

[26] Section 32 of Article 9 of the CGAAO By-laws describes the request to admit process. A notice may be sent to the subject of a misconduct proceeding, and if within 20 days the individual does not respond, he/she is deemed to have admitted the facts set out in the request to admit notice.

[27] The applicant concedes that the structure of the request to admit process is procedurally fair; however, he does object to the decision in this case to refuse his motion to withdraw the deemed admissions.

[28] He notes that, as the CGAAO By-laws do not contain a procedure for withdrawing deemed admissions, the Conduct Tribunal should have applied the common law test for obtaining leave to withdraw deemed admissions. [page163]

[29] That test is composed of three factors:

(a) the withdrawal of the admissions will raise triable issues;

(b) there is a reasonable explanation for the making of the admissions and/or change of position; and

(c) the withdrawal of the admissions will not result in any prejudice to the opposite party that cannot be compensated for in costs.

[30] The applicant argues that the principles for setting aside a default judgment are analogous to a motion to withdraw deemed admissions. He drew our attention to Mountain View Farms Ltd. v. McQueen, [2014] O.J. No. 1197, 2014 ONCA 194, at paras. 48-89, in which the Court of Appeal clarified that there are five factors to weigh when considering whether to set aside a default judgment:

(a) whether the motion was brought promptly after the defendant learned of the default judgment;

(b) whether there is a plausible excuse or explanation for the defendant's default in complying with the Rules;

(c) whether the facts establish that the defendant has an arguable defence on the merits;

(d) the potential prejudice to the moving party should the motion be dismissed; and the potential prejudice to the respondent should the motion be allowed; and

(e) the effect of any order the court might make on the overall integrity of the administration of justice.

[31] Counsel for the Tribunals submits that this court has no jurisdiction to consider the October 24, 2012 motion and the resulting decision, as it was a preliminary motion.

[32] Counsel for the Discipline Committee also asserts that the applicant is attempting to re-argue the motion and that this court should not undertake such analysis.

[33] As I have determined that there was a breach of natural justice at the December 11, 2012 hearing unless the restriction upon the applicant's right to a full and fair hearing can withstand scrutiny by this court, I must analyze the decision on the October 24, 2012 motion. I reject the respondents' submission that I lack the jurisdiction to conduct such an analysis because the decision was a preliminary one. In this case, the applicant sought to judicially review the decision on the October 24, 2012 [page164] motion after it was made. The respondents successfully argued before this court that that application should be dismissed on the ground of prematurity. To avoid fragmenting the proceedings, the applicant was appropriately directed to exhaust his remedies under the statutory scheme prior to seeking judicial review, which the applicant has now done. In the face of this history, a submission that the ruling in question (which drove the outcome of the proceedings) is no longer capable of being judicially reviewed is disingenuous.

October 24, 2012 Motion

[34] As the Conduct Tribunal gave no reasons for refusing the motion, my ability to analyze that decision from any standard of review is somewhat constrained.

[35] Based upon the record, I can reasonably conclude that the correct legal test for withdrawing deemed admissions was brought to the attention of the Conduct Tribunal. However, in the absence of reasons, I am unable to determine whether the Conduct Tribunal applied that test correctly, or reasonably, or at all.

[36] Nevertheless, from the record I am able to review the reasonableness of the decision, and I conclude, even applying this more deferential standard of review, the decision arising from the October 24, 2012 motion cannot stand. I need not, therefore, perform a standard of review analysis to determine whether the issue should be reviewed from the less deferential standard of review of correctness.

[37] Counsel for the respondents both concede that the common law test for the withdrawal of the admissions is the appropriate legal test. They also concede that the withdrawal of the deemed admissions raises a triable issue and will not result in any prejudice to them that cannot be compensated for in costs. However, they submit that the Conduct Tribunal must have concluded that the applicant failed to provide a reasonable explanation for not responding within the 20-day period.

[38] That the applicant and this court is asked to rely upon the respondents' counsel's understanding of the basis upon which the Conduct Tribunal reached its decision is reflective of the effect of the lack of reasons and is troubling.

[39] However, as the respondents concede that the foundation of the Conduct Tribunal's decision was the lack of a reasonable explanation for not responding to the request to admit, I need only analyze the reasonableness of this aspect of the decision.

[40] The only evidence before the Conduct Tribunal was two affidavits of the applicant and an affidavit of Susan McDonald. Ms. McDonald's affidavit simply confirmed the service upon the [page165] applicant of various documents. The applicant was not cross-examined on his affidavits.

[41] Early in the investigation, the Discipline Committee knew that the applicant intended to contest the allegations. Before a notice of hearing was issued, Mr. Voudouris met with an investigator and explained his version of events. Eleven days after the applicant advised counsel for the Discipline Committee that he was seeking new counsel, he was served with the request to admit; five days after receipt of the request to admit, the applicant left the matrimonial home due to a breakdown of his marriage; three days after leaving the matrimonial home, the individual who made the original complaint brought a motion to freeze the applicant's assets in connection with a civil action that the individual had commenced, returnable on August 1, 2012.

[42] This period was a very stressful one for the applicant, and a period during which many issues required the applicant's attention.

[43] The applicant's evidence was that he felt that since the discipline hearing had been adjourned to October 24, 2012, he had time to secure new counsel and, further, he did not fully appreciate the consequences of not responding to the request to admit.

[44] When he received the letter from the Discipline Committee on August 31, 2012, advising that the discipline hearing would proceed on the basis of the deemed admissions, he immediately retained new counsel who wrote to the Discipline Committee on September 21, 2012, requesting its consent to the withdrawal of the deemed admissions.

[45] The applicant's evidence is uncontradicted.

[46] Based upon the evidence before the Conduct Tribunal, it was unreasonable for it to conclude that the applicant did not have a reasonable explanation or, framed in terms of the relevant factors for a setting aside a default judgment, a plausible excuse, for failing to respond during the 20-day period.

[47] Moreover, in considering the issue before it, particularly as the deemed admissions were effectively determinative of the alleged misconduct, the Conduct Tribunal was also required to weigh the prejudice to the respondents if the motion to withdraw was granted against the prejudice to the applicant and the administration of justice if it was not. In this regard, as already noted, there was no prejudice to the respondents that could not be compensated for in costs. On the other hand, if the applicant was not allowed to withdraw the admissions, the results of any [page166] subsequent hearing were a foregone conclusion, namely, his conviction on the charges against him.

[48] Given this, I find that, in refusing the applicant's motion to withdraw the deemed admissions, the Conduct Tribunal reached an unreasonable decision: one that does not fall within the range of acceptable outcomes that are defensible in respect of the facts and the law.

Failure To Give Reasons

[49] Although the applicant's basis for judicial review was not founded on the absence of reasons, in these circumstances, the absence of reasons is troubling.

[50] Counsel for the respondents both argue that reasons are never required for interim decisions as s. 16.1(3) of the Statutory Powers Procedure Act, R.S.O. 1990, c. S.22 ("SPPA") provides that "[a]n interim decision or order need not be accompanied by reasons".

[51] However, the Supreme Court in Baker v. Canada (Minister of Citizenship and Immigration, 1999 699 (SCC), [1999] 2 S.C.R. 817, [1999] S.C.J. No. 39, at para. 43, directed that in certain circumstances, particularly where the decision is of important significance to the individual, the duty of procedural fairness requires an explanation of the decision.

[52] Subsection 16.1(3) of the SPPA does not go so far as to state that reasons will never be required for an interim order or decision. The duty to give reasons in certain circumstances, as enunciated in Baker, is not inconsistent with this subsection. There will be many circumstances in which no duty to give reasons will arise for interim decisions or orders, but sometimes natural justice will require some explanation for the decision.

[53] The lack of an obligation under the SPPA to provide reasons does not preclude the duty to provide reasons in certain circumstances, as identified by Baker, from arising. In fact, tribunals have provided reasons for interim orders where the circumstances warranted: see Toussaint v. Ontario (Minister of Health and Long Term Care), [2010] O.H.R.T.D. No. 2098, 2010 HRTO 2102; Sheet Metal Workers' International Assn., Local 30 v. United Brotherhood of Carpenters and Joiners of America, Local 1946, [2010] O.L.R.D. No. 2226, 2010 30906 (Arb. Bd.); Ontario Public Service Employees Union v. Ontario, [2002] O.L.R.D. No. 1338, 2002 26026; Ontario Public Service Employees Union v. Ontario (Management Board of Cabinet), [1996] O.L.R.D. No. 3477, 1996 11200. [page167]

[54] A finding of professional misconduct is of great significance to a professional, notwithstanding that the penalty for Mr. Voudouris was a suspension of his membership, rather than a permanent ending of his career. An 18-month suspension, together with publication of the finding of misconduct, would have a very serious impact upon the applicant's professional life. In Baker, the Supreme Court cited favourably Kane v. University of British Columbia, 1980 10 (SCC), [1980] 1 S.C.R. 1105, [1980] S.C.J. No. 32, at p. 1113 S.C.R., where Dickson J. (as he then was) stated:

A high standard of justice is required when the right to continue in one's profession or employment is at stake . . . A disciplinary suspension can have grave and permanent consequences upon a professional career.

[55] Not only was the subject matter of great significance to the applicant, the consequence of the decision was significant. It was not a minor procedural decision; it was determinative of the misconduct proceeding. No witnesses were called at the December 11, 2012 hearing; the applicant was convicted of misconduct solely on the basis of the deemed admissions.

[56] In the circumstances of this case, the Conduct Tribunal had a duty to give reasons for the refusal of the motion. The failure to do so was a breach of natural justice.

Conclusion

[57] At the December 11, 2012 hearing, the Conduct Tribunal denied the applicant his right to a full and fair hearing, in circumstances amounting to a breach of natural justice. The restriction on the rights of the applicant was based upon the unreasonable decision by the Conduct Tribunal to refuse the applicant's request to withdraw the deemed admissions. Further, in the circumstances, there was a breach of natural justice when the Conduct Tribunal failed to provide any reasons whatsoever for its dismissal of the October 24, 2012 motion.

[58] The conviction of professional misconduct is quashed; the decision of the Conduct Tribunal dated March 6, 2013 and the decision of the Appeal Tribunal dated October 21, 2013 are quashed; and the applicant's motion to withdraw the deemed admissions is granted. The applicant shall have 20 days from the date of the release of these reasons to respond to the request to admit. The allegations of professional misconduct are remitted back to the Conduct Tribunal for a hearing on the merits before a differently constituted panel. [page168]

Costs

[59] The respondents shall pay the applicant costs in the amount of $12,000, as agreed by the parties.

Application allowed.

End of Document