Court File and Parties

CITATION: Simpson v. Toronto Community Housing Corporation, 2016 ONSC 76

DIVISIONAL COURT FILE NO.: DC-25914 DATE: 20160427

ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT

Lederman, Sachs, Wilton-Siegel JJ.

BETWEEN:

MICHAEL SIMPSON Applicant

– and –

TORONTO COMMUNITY HOUSING CORPORATION Respondent

Michael Simpson, appearing in person

Michael Schafler and Kathryn McCulloch, appearing for the Respondent

HEARD at Toronto: December 21, 2015

Reasons for Judgment

LEDERMAN J.

NATURE OF PROCEEDING

[1] The applicant applies for judicial review of a review decision of the Toronto Community Housing Corporation (“TCHC”) dated April 3, 2014. That decision upheld two earlier decisions of the TCHC to remove the applicant’s rent subsidy.

[2] The applicant submits that the TCHC breached its duty of procedural fairness, namely, that it violated the applicant’s “legitimate expectations” about the review process by not following procedural requirements from statutes and TCHC policies. The applicant further submits that TCHC has been harassing him, failing to accommodate him because of his disabilities and has provided inadequate disclosure during the process. The applicant asks that the review decision be set aside and that the determination of his eligibility for the subsidy be remitted to the TCHC for further consideration.

BACKGROUND

[3] The applicant is a lawyer who works through a “single lawyer professional corporation” known as the Michael Simpson Legal Professional Corporation (“MSLPC”). By drawing a personal income from the professional corporation, the applicant claims that his annual income for 2010 and 2011 was $12,000 while his annual income for 2012, 2013 and 2014 was $10,000. He also claims that the professional corporation posted a business loss of $13,354.92 in 2013.

[4] The applicant has many health issues including AIDS, chronic pain and depression. He also takes a variety of medications which affect his functionality. He submits that these issues affect his ability to work and accordingly, he only works on a part-time basis. He also states that these health concerns have affected his ability to participate in these proceedings.

[5] For nearly 10 years, the applicant has been a tenant of TCHC. The applicant’s rent had been subsidized by TCHC. In order to maintain his eligibility for the subsidy, the applicant was required to provide certain financial information to TCHC. He has had disputes with TCHC on issues of his income for purposes of subsidy and other matters for several years.

[6] Rent Geared to Income (“RGI”) subsidies are administered by the TCHC in accordance with the Housing Services Act, 2011 S.O. 2011 c. 6, Sched. 1 (“the HSA”) and its regulations. The TCHC is Canada’s largest social housing provider. Many people are seeking to get into the RGI program and TCHC is constrained by funding and resource limitations.

[7] The process for RGI administration is guided by the City of Toronto’s RGI Administration Manual (the “the Manual”). The Manual informs the TCHC how it should calculate income for the purpose of administering the RGI regime. The Manual suggests that if a tenant owns an incorporated business, the supporting documents which could be requested for RGI’s purposes are audited financial statements including a balance sheet, T4 slips for the individual, the corporation’s income tax return, the notice of assessment for the corporation, and the individual’s income tax return and notice of assessment.

[8] Every year, the TCHC calculates the amount of rent that a household will pay if it receives an RGI subsidy; eligible tenants provide the TCHC with documents to demonstrate their income levels; and TCHC either approves the subsidy, denies the subsidy or requests additional documentation. If a tenant wants to challenge an RGI subsidy determination, he or she may ask the TCHC to schedule a hearing of the RGI Review Body.

[9] In the summer of 2013, the applicant failed to submit financial documentation pertaining to his income and assets, including a copy of his 2012 notice of assessment from the Canada Revenue Agency, to support his continued eligibility for an RGI subsidy by the required deadline. As a result, TCHC issued a notice of decision on August 7, 2013 removing his subsidy (the “August Decision”).

[10] Later that month, TCHC received an anonymous tip that the applicant may have been understating his income by crafting his own T-4 slip to show income far lower than his true earnings through his legal professional corporation.

[11] By letters dated August 27, 2013 and September 20, 2013, TCHC then requested the recent notices of assessment for MSLPC for the two prior years and bank statements for certain corporate bank accounts.

[12] By letter dated September 23, 2013, the applicant responded by challenging the authority of TCHC to request documentation of MSLPC. He also took the position that the TCHC had to demonstrate that the bank accounts for which information was sought were still active before he would initiate a search of his past records. In the same letter, the applicant provided the TCHC with a copy of his personal 2012 notice of assessment, the non-delivery of which had been the principal basis for the August Decision.

[13] By a further letter dated September 30, 2013, the TCHC set out in detail the basis for its authority to require the information requested in its earlier letters referring, among other things, to section 29(1)(b) of Ontario Regulation 367/11 (the “Regulation”). The letter also restated the specific information requested in its earlier letters.

[14] The applicant failed to provide this information. As a result of the August Decision, the applicant’s subsidy had been terminated. However, as indicated in a letter of the applicant to the TCHC dated December 20, 2013, the applicant expected that it would be reinstated based on delivery of his 2012 notice of assessment.

[15] In response to this letter, the TCHC issued a further letter dated December 24, 2013 which dealt with three matters. First, it addressed the fact that the August Decision remained in effect. It treated the applicant’s letter as a request for an in-person review of that Decision and instituted the process for such a review, even though it had undertaken a review in accordance with the HSA earlier in August 2013. Second, it restated its requirement for delivery of the additional information pertaining to MSLPC and the bank accounts requested in the correspondence described above, the basis for its authority to make such request, and the significance of the applicant’s failure to comply with these requests even if the August Decision were set aside after the in-person review. Third, the TCHC issued a further notice of decision terminating his RGI subsidy based on the applicant’s failure to file the further information pertaining to MSLPC and the bank accounts (the “December Decision”). The TCHC then proceeded on the basis that the applicant would seek an in-person review of this Decision and forwarded the December Decision to the RGI Review Body for review together with the August Decision.

[16] The applicant received a hearing on both the August Decision and the December Decision on March 11, 2014. At that hearing, the applicant submitted an affidavit declaring that, to his knowledge, none of the bank accounts found by the TCHC’s investigation team were presently open or controlled by him, nor under the care or control of any corporation in which he had ownership. Further, he declared that due to health and financial limitations, he could not file corporate income tax returns for MSLPC.

[17] As mentioned, the applicant had been provided with a detailed letter on August 27, 2013 outlining what documents were required to be submitted and was given three different written extensions by the tenant service coordinator to submit the documents. He belatedly filed some but not all the financial records requested. Specifically, he failed to include the past two years of corporate notices of assessment and statements of certain bank accounts.

[18] Because of the failure to submit the required documentation, the RGI Review Body, on April 3, 2014, determined that the applicant had failed to comply with the requirements for the continuation of his RGI subsidy and it upheld both the August Decision and December Decision removing his RGI subsidy effective December 1, 2013.

STANDARD OF REVIEW

[19] The appropriate standard of review in the present case is reasonableness, given the fact- specific nature of the inquiry and the role of the RGI Review Body in the statutory scheme and the legislative framework. The RGI review process squarely engages the expertise of the panel members who are thoroughly familiar with these types of matters.

[20] To the extent that questions of procedural fairness arise, no standard of review analysis applies to such questions. Rather, a court determines whether or not procedural fairness has been breached.

PROCEDURAL FAIRNESS

[21] The applicant complains that TCHC violated its duty of procedural fairness in a number of ways. Specifically, the applicant states that he has not been provided sufficient participatory rights, including disclosure, hearing rights including times and delivery of documentation and he also challenges the extent and sufficiency of the reasons for judgment.

[22] The applicant submits that there has been a failure to adequately comply with eviction prevention policies as set out in the LeSage Report (2010) and the Crean Report (2013) particularly in failing to provide a transparent complaint process and in accommodating him as a vulnerable tenant who has had difficulty in providing documentation or information.

[23] In Baker v. Canada (Minister of Citizenship and Immigration), 1999 699 (SCC), [1999] 2 S.C.R. 817, the Supreme Court of Canada held that all the circumstances of a case must be considered in order to determine the content of the duty of procedural fairness. It is ultimately determined based on the nature of the decision being made and the process being followed in making it. Further, the duty of fairness ought to be viewed in light of the statutory, institutional and social context to ensure that appropriate decisions are being made using fair and open procedures.

[24] We are of the view that the RGI Review Body afforded the applicant appropriate procedural fairness and gave him every benefit of the doubt to present his position, namely,

(a) Full disclosure of the necessary information in the August and December Decisions.

(b) The deadline to file additional information was extended three times.

(c) The scheduling of the RGI Review Body hearing was done in accordance with the applicant’s schedule, including his request for an adjournment.

(d) The RGI Review Body explained its process to the applicant on a number of occasions.

(e) The RGI Review Body members are all experienced and knowledgeable staff members.

(f) The applicant was allowed to fully participate in the proceedings.

[25] The RGI Review Body complied with the review process requirements set out in sections 155, 156 and 158 of the HSA and section 138 item 1 of the Regulation. It did nothing to prejudice the applicant’s right to procedural fairness and, in fact, did everything to respect it. The applicant presented his case fully, having all relevant facts, documents and considerations addressed by the RGI Review Body in rendering its Decision. All of this, taken together, suggests that the process was entirely fair and that the applicant’s criticisms are unfounded.

[26] The applicant states that he supplied TCHC with his T-4 slip and ultimately a 2013 corporate tax return and financial statement. He claims that TCHC was not satisfied and wanted details of bank statements and was in effect seeking a “full forensic accounting”. It should be noted that the TCHC is not required to accept any specific documentation (such as the applicant’s T-4 slip) as proof of assets or income. Given the TCHC’s responsibility, it was reasonable for it to seek corporate notices of assessment and bank account information.

[27] Further, there is no basis for the applicant’s allegation that the process gave rise to a reasonable apprehension of bias. None of the Panel Members even occupied the same building complex as the applicant. They were not the same people who rendered the original decision. None of them had any financial motive, the prospect of financial gain or any other direct or indirect pecuniary or proprietary interest based on the outcome of the hearing. As a result, no reasonable observer could conclude that there was any apprehension that the RGI Review Body would not decide this matter fairly.

[28] The applicant also alleges that there has been procedural unfairness because the RGI Review Body conducted a “pre-hearing” of the matters to be discussed at the hearing without his knowledge and where he was unable to be present. No such evidence of a pre-hearing exists nor can such an inference be drawn from any of the correspondence.

[29] The applicant complains that his disabilities affected his ability to provide appropriate information and that the RGI Review Body failed to consider these disabilities and failed to accommodate him. There is no evidence to suggest that his disability was the reason for his failure to submit corporate financial materials. In fact, the RGI Review Body specifically referred to his health issues and ultimately concluded that they were not responsible for his failure to file the relevant records and, accordingly, there was no failure to accommodate the applicant because of disabilities. Moreover, the applicant made no specific request for an accommodation tied in some manner to a particular disability.

[30] The review decision listed the documents which the applicant tendered and indicated specifically that it had reviewed his materials and his comments. The decision properly and accurately characterizes the nature of the exchange between the applicant and TCHC and the decision follows a logical and transparent progression. It must be emphasized that the TCHC was not required to accept the applicant’s T-4 slip as conclusive proof of his assets or income, but had a broad discretion in determining the eligibility of the household for RGI assistance. It was within the service manager’s authority to ensure that the T-4 reflected the applicant’s actual income. Given the TCHC’s responsibility to prudently administer the RGI subsidy program, it was reasonable for it to seek further financial information from the applicant in the form of corporate notices of assessment and bank account information to verify his assets and income and not just accept the limited information provided by the applicant.

[31] The applicant was made aware that the TCHC required banking documentation and notices of assessment for MSLPC for two years. He was in a position to provide financial information regarding MSLPC including corporate tax returns or corporate financial statements for MSLPC, if notices of assessment had not been received, and bank statements for the active bank accounts, if the accounts identified by the TCHC investigation team were no longer active as he alleged. He failed to provide such corporation financial information. The RGI Review Body reasonably considered the banking account information provided in his affidavit to be inadequate.

[32] The service manager considered whether, under s. 52(1) of the HSA, the applicant’s RGI assistance should be continued. Under s. 29(1)(a) of the Regulation, a household ceases to be eligible if the household fails to provide information requested by the service manager for the purposes of continuing eligibility.

[33] Section 29(2) of the Regulation provides that the service manager may determine that the household remains eligible if the service manager is satisfied that there are extenuating circumstances. Further, under s. 60, item 1 of the Regulation, the service manager shall not require a person to provide information or documents if the service manager is satisfied that the person is unable to do so. However, in the particular circumstances of this case, it was reasonable for the service manager to conclude that there were no extenuating circumstances nor any inability on the part of the applicant to provide the information.

[34] The applicant also alluded to incidents of “harassment” by TCHC’s Notices of Inspection and entrances into his residence in respect of alleged repair work. There is no evidence to establish harassment and, in any event, there is no connection between the alleged harassment and the decision making process regarding his RGI subsidy.

[35] TCHC provided the applicant with every opportunity to comply, but he continued to withhold complete financial information regarding MSLPC and its bank accounts. In the end, the TCHC had a reasonable basis for concluding that insufficient financial information was provided by the applicant to justify continuation of the RGI subsidy.

CONCLUSION

[36] There was no breach of any duty of procedural fairness. Furthermore, the decision of the RGI Review Body was reasonable under the circumstances. The application is dismissed.

[37] Given the lengthy process that the TCHC has been put through by the applicant, it is entitled to its costs of the application which we fix at $ 5,000 all inclusive, payable by the applicant, but only if demanded.

___________________________ Lederman J.

Sachs J.

Wilton-Siegel J.

Released:

CITATION: Simpson v. Toronto Community Housing Corporation, 2016 ONSC 76

DIVISIONAL COURT FILE NO.: DC-25914 DATE: 20160427

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

Lederman, Sachs, Wilton-Siegel JJ.

BETWEEN:

MICHAEL SIMPSON Applicant

– and –

TORONTO COMMUNITY HOUSING CORPORATION Respondent

REASONS FOR JUDGMENT

LEDERMAN J.

Released: April 27, 2016