CITATION: 2143983 Alberta Ltd. v. Registrar of Motor Vehicles (Ontario), 2021 ONSC 7422
DIVISIONAL COURT FILE NOS.: 192/21
DATE: 20211109
SUPERIOR COURT OF JUSTICE – ONTARIO
DIVISIONAL COURT
RE: 2143983 Alberta ltd. v. registrar of motor vehicles
BEFORE: D.L. Corbett J.
COUNSEL: Y.J. Baykara and Shaun Singh, for the Appellant
Patrick Moore, for the Respondent
HEARD at Toronto by Zoom: April 7, 2021
ENDORSEMENT
[1] The Appellant moved for a stay of the decision of the License Appeal Tribunal dated February 24, 2021, confirming an order of the Deputy Registrar of Motor Vehicles of the Ontario Ministry of Transportation directing seizure of the Appellant’s vehicle permits and number plates.
[2] This court dismissed the motion for a stay on May 11, 2021, with these reasons to follow.
This Motion
[3] Subsection 50(3.1) of the Highway Traffic Act, RSO 1990, c. H.8 (the “HTA”), provides a right of appeal from the Tribunal’s decision to this court. Subsection 50(3.2) of the HTA provides:
Despite the Statutory Powers Procedure Act, the filing of an appeal under subsection 3.1 does not stay the decision of the Tribunal being appealed, unless the Divisional Court orders a stay.
[4] The Appellant, as the moving party, bears the onus on this motion to satisfy the test for a stay:
(1) Is there a serious issue to be decided on the appeal?
(2) Will the Appellant suffer irreparable harm of the stay is not granted pending the appeal?
(3) Does the balance of convenience favour granting the stay?
See RJR MacDonald Inc. v. Canada, 1994 117 (SCC), [1994] 1 SCR 311; H&B Transportation Ltd. v. Ontario (Registrar of Motor Vehicles), [2004] OJ No. 5431 (Div. Ct.).
[5] The Appellant focused on the merits of the proposed appeal. I consider the merits to be weak. The Appellant argues that the Tribunal erred “by incorrectly focusing on [the Appellant’s] past instead of considering their current safety performance”. This is an argument about the appropriate weight to be placed on different aspects of the factual record and the decision of the Tribunal on this aspect of the case will be afforded substantial deference in this court. The Appellant argues that, under new ownership, it was “running a safe and successful company”. On the face of the decision below, the Tribunal did consider the Appellant’s ongoing safety record and placed such weight on aspects of the evidentiary record as it considered appropriate. Again, this issue appears to turn on factual findings below, which attract deference on appeal in this court. The Appellant argues that the Tribunal “made an unfounded inference, namely that “[the new owner] Ms Cucos would be controlled by [the former owner] Nagularajah to run an unsafe business.” The Tribunal considered Mr Nagularajah’s safety history, the fact that he and Ms Cucos are common law spouses, a pattern of Mr Nagularajah having his businesses owned in the name of close relatives or privies (his niece, his mother and a paralegal), and evidence of the safety record of the Appellant after the transfer of the business. Drawing inferences from the facts is, again, part of the Tribunal’s factfinding process and attracts deference in this court. On the record before, as put to this court on this motion, the Appellant will have an uphill argument persuading the court that there is no foundation for the Tribunal’s conclusion that the Appellant continues to operate its business in a manner that creates an unacceptable safety risk to the public.
[6] The Appellant argued that its business will be substantially destroyed if the stay is not granted. I do not find that argument compelling. The Appellant will suffer economic consequences of a temporary shutdown in its operations, but there is no evidence that the Appellant would be unable to resume operations if it succeeds on the appeal. On the evidence, this case is indistinguishable from Hartstein Swine Co. Ltd. v. Registrar of Motor Vehicles, 2018 ONSC 6655: the Appellant speculates that its customers will not return to it if it succeeds on the appeal, but there is no evidence to support this speculation (see Sazant v. College of Physicians and Surgeons (Ontario), 2011 CarswellOnt 15914, para. 11).
[7] The Appellant argues that failure to grant a stay would cause irreparable harm to Ms Cucos because she personally guaranteed contracts for the business. Ms Cucos acquired the business when it was facing prosecution for serious safety violations, and loss of its licenses was a potential consequence of those prosecutions. In this circumstances, Ms Cucos knowingly undertook the risk that has come to pass: loss of licenses. Ms Cucos cannot use her choice to undertake the risk as a basis to now avoid it.
[8] The Appellant argues that its employees – most of whom are truck drivers – will suffer irreparable harm because of loss of employment during the COVID-19 pandemic. I reject this argument: there is no evidence that competent truck drivers would have difficulty finding alternative employment.
[9] Even if it was thought that the merits of the appeal are sufficient to pass the low threshold for the first branch of the test for a stay, and even if it was concluded that there will be irreparable harm if a stay is not granted, the balance of convenience weighs strongly against a stay.
[10] The Appellant has an atrocious safety record. Its former principal has a history of safety issues in connection with other businesses. The basis of the Appellant’s argument below and on appeal in this court is that the business has been transferred to new ownership and positive steps have been taken to remedy safety issues since that transfer.
[11] The business was transferred to the former principal’s spouse, Alina Cucos. The appellant argued that the non-arm’s length nature of the transfer is not a basis to deny the stay: the record establishes that the new principal, the former principal’s spouse, is an experienced transportation professional and that she does not have a history of safety violations in businesses for which she has had responsibility.
[12] There are three responses to this argument. First, the new principal acquired a business with a history of serious safety violations and ongoing proceedings in which the Registrar was seeking revocation of licenses. The slate is not wiped clean because of a transfer of the business.
[13] Second, enforcement efforts by the Registrar after the transfer of the business disclosed further serious safety violations. It may be that things have improved, as argued by the Appellant, but the problem has not been solved and safety standards of the Appellant have not reached a satisfactory level. Third, these factors were all before the Tribunal and the Tribunal upheld the Registrar’s order after considering these factors.
[14] As stated by Horkins J. in Hartstein Swine:
I am not persuaded that the balance of convenience favours a stay. Public safety is too important to take a risk. The public interest in road safety outweighs any pecuniary harm that the appellant may suffer (1445913 Ontario Inc. (c.o.b. HGC Transport) v. Ontario (Deputy Registrar of Motor Vehicles), [2008] O.J. No. 6041 at para. 31; H & B Transportation Ltd. v. Ontario (Registrar of Motor Vehicles), [2004] O.J. No. 5431 at para. 6).
[15] As noted above, the Appellant’s safety record is atrocious. It has put the public at serious risk. The balance of convenience strongly weighs in favour of refusing the stay and thereby supporting the Registrar’s statutory duty to promote highway safety in Ontario.
[16] The motion for a stay is dismissed.
[17] If the parties have not yet completed their exchange of appeal materials, they shall provide the court with an agreed schedule to ready the appeal for a hearing and shall provide this schedule to the court by email by November 26, 2021.
D.L. Corbett J.
November 9, 2021