of Ontario, 2023 ONSC 2979
DIVISIONAL COURT FILE NO.: 214/22
DATE: 20230622
ONTARIO SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
D.L. Corbett, Leiper and Muszynski JJ.
BETWEEN:
MILLICENT PRINCE
Applicant (Moving Party)
– and –
CHIEF EXECUTIVE OFFICER OF THE FINANCIAL SERVICES REGULATORY AUTHORITY OF ONTARIO
Respondent (Responding Party)
Andrew Rogerson, counsel for the Applicant (Moving Party)
Troy Harrison and Kelsey Chisamore-Johnston, co-counsel for the Respondent (Responding Party)
HEARD at Toronto: May 16, 2023
LEIPER J. (Orally)
The Appellant appeals from a decision of the Financial Services Tribunal (the “Tribunal”). under the Mortgage Brokerages, Lenders and Administrators Act, 2006. (the “MBLAA”).
The Appellant requested a hearing before the Tribunal after receiving a notice of proposal to revoke her mortgage licence based on a reasonable belief that she was not suitable to be licensed as a mortgage agent. The grounds for this belief were the Appellant’s past conduct, false statements by the Appellant in her application to be licensed on three subsequent renewals and for misleading Financial Services Regulatory Authority of Ontario (“FSRA”) investigators.
The Tribunal held a hearing over the course of six days. The Tribunal received evidence in the form of a detailed Agreed Statement of Facts (“ASF”) as well as viva voce evidence from six witnesses, including the Appellant.
The Tribunal issued reasons in which it dismissed the Appellant’s arguments and ordered FSRA to revoke the Appellant’s mortgage agent licence. See Prince v. Ontario (CEO of FSRA) 2022 ONFST 6; 2022 CarswellOnt 3972 at paras 125, 120, 142, 146 and 147. The Tribunal found that the Appellant had engaged in a repeated pattern of dishonesty. The Appellant’s dishonesty included her failure to report her previous revocation and her previous criminal conviction to FSRA as well as by providing FSRA with false information during its investigation.
The Tribunal concluded that there were reasonable grounds to believe that the Appellant would not deal or trade in mortgages with integrity and honesty.
The Tribunal concluded that revocation was the only appropriate penalty given the need to protect the public.
Standard of Review
The statutory right of appeal to this court is provided for in Section 21(5) of the MBLAA. Accordingly appellate standards of review apply, which are: (i) correctness for questions of law; and (ii) palpable and overriding error for questions of fact or mixed fact and law, where the legal principle is not readily extricable: see Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65 at para. 37, [2019] 4 SCR 653.
Where a penalty imposed by a regulatory tribunal is reviewed on appeal, the reviewing court will consider whether the penalty was imposed with reference to the facts of the case and prior penalties imposed for similar infractions or in similar circumstances to consider whether the penalty imposed in the case before it was “clearly unfit” or a substantial departure from the cases before the tribunal: see College of Physicians and Surgeons of Ontario v. Peirovy, 2018 ONCA 420 at para. 56; Mitelman v. College of Veterinarians of Ontario, 2020 ONSC 3039 at para. 18.
Issues
The Appellant submits that the Tribunal’s finding that she was unsuitable to be licensed was unreasonable and submits that it applied the wrong standard of proof to the evidence it heard at the hearing.
ANALYSIS OF THE ISSUES
Did the Tribunal Apply the Incorrect Standard of Proof?
The Tribunal received and accepted evidence at the hearing that the Appellant:
-failed to disclose the revocation of her real estate salesperson registration in 2009 on her 2014 application for a licence and on three renewal applications in 2016, 2018 and 2020;
failed to disclose a 2014 conviction for attempting to obstruct justice on her renewal applications in 2016, 2018 and 2020;
misled FSRA investigators when interviewed;
concerning the underlying conduct of six occasions of mortgage fraud and a fraud-related criminal conviction the Tribunal considered relevant to the question of whether the Appellant would deal or trade in mortgages in accordance with the law with integrity and honesty.
The Appellant gave various explanations for the missing disclosures ranging from inadvertence to faulting others. The Tribunal did not find the Appellant’s explanations to be
credible. The Tribunal found that her evidence was evasive, and often marked by claimed failures in recollection. The Tribunal concluded that the Appellant had deliberately concealed this information from her regulator.
The Appellant submitted that a sliding scale or higher standard should be applied in circumstances such as this. Counsel referred the panel to Australian authorities to that effect and to a strongly worded minority opinion by the Chief Justice of the Supreme Court of New Zealand that a higher standard should be applied in circumstances where serious allegations and penalties are engaged: Z v. Dental Complaints Assessment Committee [2008] NZSC 55; [2009] 1 NZLR 1.
I disagree.
It is well settled law in Canada that there is one civil standard of proof at common law, which is proof on the balance of probabilities, notwithstanding the seriousness of the allegations or the consequences: F.H. v. McDougall, 2008 SCC 53 at para. 40 [2008] 3 SCR 41. This decision is binding on us as it was on the tribunal below.
The Tribunal correctly applied the civil standard of proof to the hearing evidence and carefully set out its reasons for rejecting the Appellant’s evidence. It did not commit any legal error in its application of the standard of proof. Further, the prosecution’s case was established by clear and cogent evidence, most of which was not contested. The issue before the Tribunal was in respect of the appellant’s explanations for the impugned conduct, explanations which were rejected by the tribunal for reasons that are discussed below. I would not give effect to this ground of appeal.
Did the Tribunal Err in Ordering Revocation of the Appellant’s Licence?
The Tribunal received oral evidence and an agreed statement of facts which grounded its finding that the Appellant was not suitable to be licensed. It found as fact that:
-the documents revealed a pattern of deceptive conduct by the Appellant;
-her fraudulent conduct led to her real estate registration being revoked;
- the FSRA licensing and renewal application process relies on applicants being honest and forthright when completing their applications and that it was the responsibility of the Appellant, not her employers or FSRA, to ensure her original and renewal applications were accurate;
-the Appellant was evasive in her evidence and her explanations were not credible;
the Appellant’s failures to report the revocation of her registration as a real estate agent and her criminal conviction for obstructing justice were deliberate and not the result of sloppiness, negligence, or lack of competence;
the Appellant provided false information to FSRA by misleading FSRA’s investigators in relation to her knowledge and involvement in the Ajax mortgage activities;
there was no evidence to support a claim that the Appellant was subject to unusual or severe pressure over the extended period in which she made false statements;
there was no basis for the Appellant’s claim that her former employers had instructed her
to not include her previous revocation or her conviction for obstructing justice in her licensing application or renewals. The Tribunal preferred the evidence of her former employer and broker, Samantha Brookes, to that of the Appellant on this point;
-there was no basis for the Appellant’s claim that she was pressured during her interviews with FSRA; and finally,
- the Appellant had been placed under supervision in the past, but this had not prevented deceptive conduct.
The Tribunal expressly concluded that a lesser penalty would not be appropriate given the Appellant’s repeated instances of dishonesty. It found that supervision is not an appropriate penalty where a licensee is dishonest, does not accept accountability, and shifts responsibility for their conduct to others.
The Tribunal also considered the regulatory context including FSRA’s statutory objectives, which include contributing to public confidence in the sectors it regulates, deterring deceptive or fraudulent conduct, practices, and activities, promoting high standards of business conduct, and protecting the rights and interests of consumers. The Tribunal found that no lesser penalty was appropriate given its findings of fact and the pattern of dishonesty on the part of the Appellant.
The Appellant does not raise any palpable or overriding error in the facts found by the Tribunal or in their conclusions having made these findings of fact and credibility.
The Tribunal’s reasons explain its findings of credibility and the findings of dishonesty which underpin its conclusions on penalty.
There is no basis for this court to interfere with the decision of the Tribunal in respect to the penalty.
Conclusion
I would dismiss the appeal.
Costs are ordered in favour of the respondent in the agreed amount of $7,500.
I agree:
I agree:
Leiper J.
D.L. Corbett J.
Date of Oral Reasons for Judgment: May 16, 2023 Date of Written Release: June 22, 2023
Muszynski J.
of Ontario, 2023 ONSC 2979
DIVISIONAL COURT FILE NO.: 214/22
DATE: 20230622
ONTARIO
SUPERIOR COURT OF JUSTICE DIVISIONAL COURT
D.L. Corbett, Leiper and Muszynski JJ.
BETWEEN:
MILLICENT PRINCE
Appellant (Moving Party)
– and –
CHIEF EXECUTIVE OFFICER OF THE FINANCIAL SERVICES REGULATORY AUTHORITY OF ONTARIO
Respondent (Responding Party)
ORAL REASONS FOR JUDGMENT
LEIPER J.
Date of Oral Reasons for Judgment: May 16, 2023 Date of Written Release: June 22, 2023