R. v. Pisces Fishery Inc., 2016 ONSC 618

CITATION: R. v. Pisces Fishery Inc., 2016 ONSC 618

COURT FILE NO.: 15-2866-AP

Chatham

DATE: 20160126

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

HER MAJESTY THE QUEEN

Appellant

– and –

PISCES FISHERY INCORPORATED

Respondent

Demetrius Kappos, for the Crown

Kenneth Marley, for the Respondent

HEARD: November 30, 2015 at Chatham, Ontario

RAIKES, J.

Nature of Appeal

1The Crown appeals from the decision at trial of Justice Fuerth (OCJ) dated March 9, 2015 pursuant to which the Respondent, Pisces Fishery Incorporated (hereafter “Pisces”) was acquitted of four summary conviction charges under the Ontario Fishery Regulations, 2007. The Crown seeks to set aside Justice Fuerth’s decision, to enter convictions and to sentence Pisces. Alternatively, the Crown asks that the decision be set aside and a new trial be directed.

Facts

2Pisces is a privately held company that operates as a commercial fisher in Lake Erie. At all material times, Pisces held Commercial Food Fishery Licences CH0065 and AY0269 (hereafter “the licences”). These licences authorized Pisces to engage in commercial fishing in particular zones on Lake Erie.

3Jorge Barbosa is one of the directors of Pisces. He was directly involved in the day-to-day business operations of Pisces on land. In that capacity, he worked principally at the office of Pisces located in Wheatley, Ontario. Although Mr. Barbosa was a “Designate” under the licences issued to Pisces, he last worked on a fishing vessel in 2000.

4Pisces owned and operated a commercial fishing vessel, the AD-CO II (hereafter “the vessel”) which was based principally in Erieau, Ontario during the 2013 summer fishing season. Erieau is approximately 54 kilometers distant from Wheatley where Pisces’ offices were situate.

5Pisces employed Melchiorre Pace as captain of the vessel at the relevant time. Pisces hired Captain Pace in 2008. Captain Pace was also a “Designate” under the licences held by Pisces. It is undisputed that both Pisces and its Designates were bound by the terms of the licences issued to Pisces.

6Both licences issued to Pisces contain the following provisions:

“1. (a) While engaging in fishing, the licencee or designate shall submit an accurate and complete Daily Catch Report (DCR) prior to landing any fish, even when no fish are caught. This DCR shall be signed by the licencee or designate and submitted as stated by these conditions.

(c) All fish named on Appendix “C” and all no harvest permitted species must be reported and landed except as provided in Condition 12(b).

(d) The licencee or designate shall not fish in an area other than that which is described on the face of this licence.

2 (b) The Captain of the vessel shall accurately maintain on a daily basis, a bound log book with entries for each days fishing activities containing the coordinates (either latitude and longitude or TD’s) and set locations for each continuous net set and lifted including the duration of the net set and length of net lifted. Units must be specified. The log book is to be used to document fishing by one vessel. The book shall be retained and be available for inspection for two years following the last date of entry in the log book.

(c) A specific page indicating the day’s date used in consecutive numerical or calendar order shall be used for each day’s fishing activities.

(d) No person shall deface or remove any pages from the log book.

(e) The logbook shall be kept on the vessel at all times and made available for inspection by an officer upon request.”

7The Daily Catch Report (hereafter “DCR”) is a carbon copy document. Copy 1 is submitted to the Ministry. Copies 2 to 5 inclusive are provided to the fish processing plant upon delivery of the fish. Copy 6 is retained in the DCR book, which is typically kept onboard the vessel. The fish processing plant sends a copy of the DCR it receives to the licencee, Pisces. Typically, Pisces received those copies some days after the catch was received by the processor.

8The DCR is signed by the captain of the vessel - in this case, by Captain Pace. As indicated above, it is a term of the licences granted to Pisces that all DCRs be “accurate and complete”.

9On May 23, 2013, the MNRF covertly installed a tracking device on the vessel pursuant to a warrant. The device was removed on July 16, 2013. The tracking device provided locational information each day for the vessel to Officer McMillan.

10The presence and type of commercial fishing gear used by the vessel was determined based on the tracking device’s speed and direction of movement. On-water inspections confirmed the accuracy of those determinations.

11On July 18, 2013, MNRF executed a search warrant onboard the vessel while it was at dock in the harbour at Erieau. Three logbooks were seized which contained information on fishing activities during the 2012 and 2013 fishing seasons. The logbooks were authored by Captain Pace and provided by him to the officers during the execution of the warrant.

12A review of the logbook revealed deficiencies in the period May 24, 2013 to July 16, 2013. Some of the deficiencies were readily apparent on the face of the logbook in that required information was not recorded. Other deficiencies were found when the logbook entries were compared to the DCRs.

13The logbook deficiencies were:

1. There was no recording of the length of each gill net lifted, nor the set duration of each gill net set and lifted;

2. For five dates, there was no recording that gill nets were set at all;

3. For six dates, the logbook recorded that gill nets were set when they were not; and,

4. On four dates, there were inconsistencies between what was recorded in the logbook and what was contained in the DCRs provided to the Ministry.

14The tracking device information was used to plot the location of the vessel on maps which were filed as evidence at trial. These maps depict where and when the vessel fished during the period in question. From the tracking device information, the Ministry determined that several of the DCRs submitted by Captain Pace for the vessel contained false and misleading information; specifically,

1. From 61 of the DCRs submitted, 31 contained incorrect gill net set durations, 58 contained incorrect lengths of gill nets lifted, and 10 contained incorrect information regarding the location of the gill nets lifted;

2. For the 10 DCRs that contained incorrect information as to the location of the gill nets lifted, significant quantities of yellow perch and walleye were falsely declared from the wrong quota zone. In addition, some of the yellow perch and walleye could not be placed as caught in a particular quota zone because more than one zone was fished.

15On September 27, 2013, the Ministry laid an information against both Captain Pace and Pisces for the following charges:

“(1) between the 24^th day of May, 2013 and the 16^th day of July, 2013 at the Village of Erieau of the Municipality of Chatham Kent, Kent County in the said West Region did violate condition 1(a) of Ontario Commercial Food Fishing License AY0269, held by Pisces Fishery Incorporated, by failing to report accurately and completely on Daily Catch Reports, to wit: contrary to section 4(2) of the Ontario Fishery Regulations, 2007, (SOR/2007 – 237) as amended, thereby committing an offence pursuant to section 78 of the Fisheries Act, R.S.C. 1985, Chapter 14 as amended.

(2) and further, that Melchiorre Pace … and Pisces Fishery Incorporated … together did violate condition 1(a) of Ontario Commercial Food Fishing License CH0065, held by Pisces Fishery Incorporated, by failing to report accurately and completely on Daily Catch Reports, to wit: incorrect commercial fishing locations, incorrect gill net set durations and incorrect length of the gill nets lifted, contrary to section 4(2) of the Ontario Fishery Regulations, 2007, (SOR/2007 – 237) as amended, thereby committing an offense pursuant to section 78 of the Fisheries Act….

(3) and further, that Melchiorre Pace … and Pisces Fishery Incorporated … together did violate condition 2(b) of Ontario Commercial Food Fishing Licence AY0269, held by Pisces Fishery Incorporated, by failing to maintain an accurate logbook, contrary to section 4(2) of the Ontario Fisheries Regulations, 2007, (SOR/2007 – 237) as amended, thereby committing an offense pursuant to section 78 of the Fisheries Act….

(4) and further, that Melchiorre Pace … and Pisces Fishery Incorporated … together did violate condition 2(b) of Ontario Commercial Food Fishing Licence CH0065, held by Pisces Fishery Incorporated, by failing to maintain an accurate logbook, contrary to section 4(2) of the Ontario Fisheries Regulations, 2007, (SOR/2007 – 237) as amended, thereby committing an offense pursuant to section 78 of the Fisheries Act….”

16Section 78 of the Fisheries Act provides that every person who contravenes the Act or its Regulations is guilty of a hybrid offence. Section 4(2) of the Regulations mandates compliance with the terms and conditions specified in the licence granted.

17The fact of the inadequacy of the logbook entries and the inaccuracy of the DCRs completed and submitted by Captain Pace was not disputed on the appeal herein. Exhibit 17 at trial is a transcribed statement by Captain Pace after being cautioned. In that statement, Captain Pace admitted that he was the captain of the vessel and that he failed to properly maintain the logbook and provided false information in the logbook and DCRs.

18It is also undisputed that prior to being employed by Pisces, Captain Pace had a lengthy history of non-compliance, including violations for misreporting harvests, locations and weights of fish in DCRs. He had received previous warnings and convictions for such conduct.

19On April 29, 2008, (five years before the time period with which the present charges are concerned), the then Ministry manager, Michael Morencie met with both Pace and Barbosa to express concern about Pace’s lengthy history of non-compliance. At trial, Morencie testified that the purpose of the meeting was to stress to Captain Pace that he needed to take more care in filling out his Daily Catch Reports. That meeting was followed by a confirmatory letter to Pace which was copied to Mr. Barbosa at Pisces. The letter confirmed the Ministry’s concern with Pace’s record of non-compliance as a designate on Lake Erie commercial fishing licences, including but not limited to errors on Daily Catch Reports.

20Mr. Morencie testified at trial that some of the prior convictions against Captain Pace which led up to the 2008 meeting were for “serious violations of the relevant regulations” as reflected in the “significant fines” levied.

21Mr. Barbosa testified that he was not fully aware of Captain Pace’s track record with the Ministry before the April, 2008 meeting. Even after that meeting, he did not know all of the particulars of Captain Pace’s convictions and fines. He was also completely ignorant of any warnings or small fines levied against Captain Pace after the April, 2008 meeting while Captain Pace worked for Pisces.

22With respect to ensuring compliance with logbook and DCR licence requirements, Mr. Barbosa testified that:

1. He reviewed in detail the terms of the licences granted to Pisces with Captain Pace each year when received;

2. He spoke with Captain Pace frequently throughout each year to make sure Captain Pace was following the rules of the licence. He received repeated assurances from Captain Pace that he was doing so and everything was fine;

3. He believed that Captain Pace understood what was required of him;

4. He did not see anything out of the ordinary between 2008 and 2010;

5. He heard nothing further from MNRF to suggest that Captain Pace was not adhering to proper conduct;

6. He did not review the logbook which was kept on the vessel to ensure completeness or accuracy;

7. He did not ask Captain Pace to provide the logbook to him or make a copy of it so that he could compare with the DCRs;

8. He believed that he would not have been able to detect inaccuracies by such a comparison in any event;

9. He did not do an audit of the DCR book; and,

10. The vessel has a GPS device on it which is in operation during certain months of the year as mandated by the Ministry. He did not consider and did not employ the device beyond the required months in order to check the accuracy of information in the logbook or DCRs. He did not believe he was supposed to do so.

23During the time period to which the charges relate, Mr. Barbosa interacted with Captain Pace two or three times each week at the equipment shanty near the office in Wheatley. On those occasions, Captain Pace arrived by land. The vessel was then in Erieau or on the lake fishing. The vessel typically departed port to fish as early as 2 a.m. and returned to dock by 1 or 2 p.m. each day.

Reasons at Trial

24Justice Fuerth found that charges before him were strict liability offences and the defence of due diligence was made out by Pisces. Specifically, Justice Fuerth wrote:

“The passage of time without conflict, without any apparent problems, and I appreciate that there was a record during the period of 2008 through to 2013 and it is not entirely clear to me, based on that record, what the nature of those infractions may have been. But I am satisfied that over a time Mr. Barbosa would have been, if you will, satisfied that his cautions and his reviews with Captain Pace, from time to time, of the obligations under the license was having the necessary effect that Captain Pace was complying with what was required.”

25He also wrote:

“In this unique circumstance where a captain is charged by the owner of a boat with the responsibility to comply with fishing regulations by way of accurate reporting, that beyond giving those instructions and ensuring that the captain has what he needs, which I would assume would be a sharp pencil and a book to record his log notes in, a logbook and daily catch reports to record the activity that is occurring. There is very little else an owner can do from shore in his office when the captain fails to carry out those specific instructions and in the circumstances I ask myself, what more could Mr. Barbosa and Pisces Fishery have done and I am not satisfied they could have done anything more.

In the circumstances I am satisfied that the defence of due diligence is made out and I am going to acquit the defendant on the charges before the court.”

26Earlier in his decision, Justice Fuerth found that the Daily Catch Reports appeared on their face to be complete. He noted that an owner who is not on the boat with the captain is relying entirely on the accurate record keeping of the captain to whom he has entrusted the boat and his fishing licence. He rejected the submission made by Crown counsel that Pisces could have put a GPS locator on the ship and from time to time double checked the location recorded on the device as against Daily Catch Reports. Justice Fuerth wrote:

“If it is not regulated then I do not see why that should be an expectation of the owner to track and verify the location of his vessel when it is the obligation of the captain to do exactly that, a captain who has experience and who has been properly instructed with respect to his obligations. The other possibility, I suppose, is some form of security video device looking over the captain’s shoulders and recording his movements. There is no such requirement under the regulations and, in my view, that would be beyond a reasonable step to expect an owner to take to ensure compliance.”

27Justice Fuerth also rejected the use of an audit, i.e. a comparison of the log books with the Daily Catch Reports, to determine whether or not there are inaccuracies in terms of record keeping. He indicated: “That is, in effect, an activity that takes place after an infraction or problem has arisen.” He went on to find that there were no errors or problems on the face of the Daily Catch Reports and that Mr. Barbosa would have been satisfied as to their completeness.

Crown Position

28The following grounds of appeal are set out in the Notice of Appeal:

1. The court erred in finding that the defendant was entitled to rely on the defence of due diligence and/or that a due diligence defence was established as a defence in this case.

2. The court erred by finding that the defendant in the circumstances could have been “satisfied” that this captain was complying with the licence requirements. As a result, the court erred in its assessment of the defendant’s standard of care on due diligence.

3. The court erred in its assessment of the extent to which the defendant could rely on delegation to fulfill the defendant’s due diligence function.

4. The court erred in finding that a due diligence defence was established with respect to the two counts concerning Daily Catch Reports (counts 1 and 2). In particular:

A) It misinterpreted and misapplied evidence with respect to the defendant’s due diligence efforts, in particular, what if any oversight the defendant provided over the accuracy of reporting on Daily Catch Reports submitted to the regulator on its behalf by the captain.

B) It erred in its assessment of what would amount to reasonable efforts on the part of the defendant to avoid the occurrence of the offences. In this regard and as one example, the court had before it uncontradicted evidence from a Crown witness as to a simple, available and potentially effective method – a comparison of Daily Catch Reports with the corresponding log book.

5. The court erred in its assessment that a due diligence defence was made out with respect to the two counts (counts 3 and 4) concerning log books that the court found to be deficient on their face in violation of licence requirements.

29In its factum and in oral argument, the Crown proceeded on the basis that the charges against the defendant were strict liability offences to which a defence of due diligence may apply.

Defence Position

30The defendant asserts the following positions on appeal:

1. The finding of due diligence is amply supported by the evidence at trial;

2. The finding of due diligence is a finding of mixed fact and law which is entitled to deference from this court; and,

3. The trial judge clearly and properly stated the applicable law.

31The defendant initially took the position that the Crown was limited to an appeal on a question of law only. Defence counsel conceded at the hearing of the appeal that the Crown is not so restricted given the decision of the Court of Appeal in R. v. Labadie, 2011 ONCA 227 at paragraphs 48-51.

Applicable Legal Principles

32R. v. Sault Ste. Marie (City), 1978 CanLII 11 (SCC), [1978] 2 S.C.R. 1299 is the seminal case which recognized strict liability offences as a distinct category of offence and the availability of the defence of due diligence to such an offence. The decision of the court was rendered by then Justice Dickson. He wrote at page 1325:

“The correct approach, in my opinion, is to relieve the Crown of the burden of proving mens rea, having regard to Pierce Fisheries and to the virtual impossibility in most regulatory cases of proving wrongful intention. In a normal case, the accused alone will have knowledge of what he has done to avoid the breach and it is not improper to expect him to come forward with the evidence of due diligence. … Equally, there is nothing wrong with rejecting absolute liability and admitting the defence of reasonable care.

In this doctrine it is not up to the prosecution to prove negligence. Instead, it is open to the defendant to prove that all due care has been taken. This burden falls on the defendant as he is the only one who will generally have the means of proof. This would not seem unfair as the alternative is absolute liability which denies an accused any defence whatsoever. While the prosecution must prove beyond a reasonable doubt that the defendant committed the prohibited act, the defendant must only establish on the balance of probabilities that he has a defence of reasonable care.”

33He also wrote at page 1326:

“…Offences in which there is no necessity for the prosecution to prove the existence of mens rea; the doing of the prohibited act prima facie imports the offence, leaving it open to the accused to avoid liability by proving that he took all reasonable care. This involves consideration of what a reasonable man would have done in the circumstances. The defence will be available if the accused reasonably believed in a mistaken set of facts which, if true, would render the act or omission innocent, or if he took all reasonable steps to avoid the particular event….”

34Finally, he wrote the following at page 1331 with respect to the defence of reasonable care or due diligence as it is known:

“One comment on the defence of reasonable care in this context should be added. Since the issue is whether the defendant is guilty of an offence, the doctrine of respondeat superior has no application. The due diligence which must be established is that of the accused alone. Where an employer is charged in respect of an act committed by an employee acting in the course of employment, the question will be whether the act took place without the accused’s direction or approval, thus negating wilful involvement of the accused, and whether the accused exercised all reasonable care by establishing a proper system to prevent the commission of the offense and by taking reasonable steps to ensure the effective operation of the system. The availability of the defence to a corporation will depend on whether such due diligence was taken by those who are the directing mind and will of the corporation, whose acts are therefore in law the acts of the corporation itself.…”[Emphasis added]

35Thus, the onus rests on the Crown to prove beyond a reasonable doubt the fact of non-compliance with the governing legislation, in this case, section 78 of the Fisheries Act. Once proven, the burden shifts to the defendant to establish on a balance of probabilities that all reasonable care was taken to avoid non-compliance.

36The case law subsequent to R. v. Sault Ste. Marie (City), supra, establishes the following principles applicable to the defence of due diligence:

1. The reasonableness of the care taken must be assessed in light of the specific circumstances of the offence(s) before the court: R. v. Emil K. Fishing Corp., 2008 BCCA 490 at paragraph 19;

2. The degree of care warranted in each case is governed by a consideration of and balancing of the gravity of the potential harm, the alternatives available to the defendant, the likelihood of harm, the degree of knowledge or skill expected of the defendant, and the extent to which the underlying causes of the offence are beyond the control of the defendant: R. v. Gonder (1981), 1981 CanLII 3207 (YK TC), 62 C.C.C. (2d) 326 at paragraph 22 (YTC);

3. Evidence of a standard practice in the industry is only one important component in determining the appropriate standard of care: R. v. Gonder, supra, paragraph 17;

4. Those who engage in an activity within a regulated area are taken to be aware of and to have accepted the responsibility of meeting an objective standard of conduct: Wholesale Travel Group Inc. v. The Queen; Attorney General for Ontario et all, Intervenors (1991), 1991 CanLII 39 (SCC), 84 D.L.R. (4^th) 161 at page 220 (SCC), cited in R. v. Petten, [1995] N.J. 118 at paragraph 47 (Nfld. SC-TD);

5. A defendant will not be held liable for unforeseeable events or activities beyond which they might reasonably be expected to influence or control: R. v. Placer Developments Ltd., [1985] B.C.W.L.D. 581 at paragraph 37;

6. The failure of government officials to properly exercise statutory responsibilities to inspect or take preventative action will not provide a defence where the defendant acted negligently: R. v. Placer Developments Ltd., supra, at paragraphs 55-56;

7. A corporate defendant must show that there was a system in place to prevent the prohibited act from occurring and that reasonable steps were taken to ensure the effective operation of that system: R. v. Safety-Kleen Canada Inc., 1997 CanLII 1285 at paragraph 24; R. v. St. Lawrence Cement Inc., [1993] O.J. No. 1442 at paragraph 29.

Standard of Review

37The appropriate standard of review is directly tied to the characterization the issues raised on this appeal. If the issue is a question of law, the applicable standard of review is correctness. In that case, no deference is owed to the trial judge below since he either made the right decision or did not: Housen v. Nikolaisen, 2002 SCC 33, [2002] 2 S.C.R. 235 at paragraph 8.

38If the issue is properly a question of fact, then the decision below is entitled to considerable deference unless the trial judge made a palpable and overriding error. In Housen v. Nikolaisen, supra, at paragraphs 10, 15-18, the Supreme Court of Canada indicated that the rationale for that deference is threefold:

1. To limit the number, length and cost of appeals;

2. To promote the autonomy and integrity of trial proceedings; and,

3. To recognize the expertise of the trial judge and his or her advantageous position.

39Where the issue is a question of mixed fact and law, i.e. the application of a legal standard to a set of facts, the standard of review falls along a spectrum. In Housen v. Nikolaisen, supra, Justices Iacobucci and Major for the court wrote at paragraph 36:

“To summarize, a finding of negligence by a trial judge involves applying a legal standard to a set of facts, and thus is a question of mixed fact and law. Matters of mixed fact and law lie along a spectrum. Where, for instance, an error with respect to a finding of negligence can be attributed to the application of an incorrect standard, a failure to consider a required element of a legal test, or similar error in principle, such an error can be characterized as an error of law, subject to a standard of correctness. Appellate courts must be cautious, however, in finding that a trial judge erred in law in his or her determination of negligence, as it is often difficult to extricate the legal questions from the factual. It is for this reason that these matters are referred to as questions of “mixed law and fact”. Where the legal principle is not readily extricable, then the matter is one of “mixed law and fact” and is subject to a more stringent standard. The general rule, as stated in Jaegli Enterprises, supra, is that, where the issue on appeal involves the trial judge’s interpretation of the evidence as a whole, it should not be overturned absent palpable and overriding error.”

40The defence of due diligence has been equated with the test in negligence; both incorporate the application of an objective standard of the reasonable man to the conduct of the defendant in the circumstances having regard to foreseeable harm and the activity in which the defendant is engaged.

41The Crown argues that the real issue here is what constitutes “due diligence” for a corporate licencee who designates a captain to operate the vessel. He argues that this case will set a precedent in the commercial fisheries context in Ontario. It is a point of controversy that is likely to arise in many future cases. As such, it falls closer to a question of law than one of mixed fact and law. In this regard, he relies upon the decision of the Supreme Court of Canada in Canada (Director of Investigation and Research, Competition Act) v. Southam Inc., 1997 CanLII 385 (SCC), [1997] 1 S.C.R. 748 at paragraphs 36 – 37.

42The defendant submits that the issue to be determined here is a question of mixed fact and law in which the legal question is inextricably intertwined with the factual matrix. Accordingly, the decision of the trial judge is entitled to considerable deference absent a palpable and overriding error.

Analysis

43The defence of due diligence requires that this defendant, not the Crown, establish on a balance of probabilities that it had in place a proper system to ensure compliance with the terms and conditions of its licences, and that it took all reasonable steps to ensure the system operated properly: R. v. Sault Ste. Marie (City), supra. The critical issue at trial and on this appeal is the standard of care to be met by the defendant in these circumstances.

44In my view, the trial judge erred as:

1. He failed to consider what a proper system would consist of;

2. He set the standard of care applicable to the defendant too low; and,

3. He applied an incorrect standard to the conduct of the defendant on the facts of this case.

45These issues are extricable from the factual matrix and I conclude that these errors amount to errors in principle. As such, they are errors of law which are subject to a standard of correctness upon review by this court.

Consideration of Proper System

46At trial, no evidence was adduced by the defendant with respect to industry standards or practices for the time period of the charges or any time period. There was virtually no evidence that the defendant’s conduct was consistent with what other licencees did.

47Likewise, there was no evidence of a “system” in place to address compliance with the requirement for accuracy and completeness of records. It must be kept in mind that the burden of proof lies on the defendant to prove a proper system and reasonable care.

48The trial judge never asked what system could the defendant have reasonably put in place to ensure the terms and conditions of the licences were being met as contemplated by the decisions in R. v. Sault Ste. Marie (City), supra, page 1331 or R. v. Safety-Kleen Canada Inc., supra, paragraph 24. Instead, his decision simply rejects steps put forward by the Crown as alternate measures that could have been implemented.

49The evidence of Mr. Barbosa does not reveal any system, formal or informal, to address the issue of compliance. He met each year with Captain Pace to go over the terms of the licences as they were received because the terms could change from year to year. Thereafter, he merely inquired of Captain Pace whether he was complying and accepted his positive responses without question. He took comfort in the absence of further contact from the Ministry. In short, he did little or nothing to ensure accurate and complete records were being kept; he left compliance entirely to Captain Pace’s good judgment which he knew to be historically flawed.

50In R. v. Safety-Kleen Canada Inc., supra, at paragraphs 23-26, the Court of Appeal upheld a conviction and cited with approval the following passage from the trial decision:

“The company had put their drivers in a position of a self - reporting situation. They had delegated to their drivers a degree of trust to comply with the regulations. Nevertheless, it is still their responsibility to ensure strict compliance. They cannot delegate and then close their eyes to non-compliance. There are not sufficient safety guards within their system to check for this type of irregularity in completion of such an important document.”

That rationale applies equally in this case. It was not open to the defendant to merely trust that Captain Pace would make accurate and complete entries in the log book and Daily Catch Reports without some system of monitoring to ensure compliance. There was no such system in place. The conduct of the defendant in speaking with Captain Pace does not amount to a system to ensure compliance.

Determination of Applicable Standard of Care

51In his decision, the trial judge found that the defendant had reason to believe his discussions with Captain Pace were having the desired effect on compliance. He went on to conclude that there was little or nothing more Pisces could have done but provide a sharp pencil, log book and DCR book. Implicit, if not express, in that finding is that the standard of care applicable required no more than was done by Pisces. In my view, that sets the bar far too low and applies an incorrect standard to the conduct of the defendant.

52At a minimum, a proper system would entail the following steps by this defendant in the circumstances:

1. Semi-annual meetings with the captain of the vessel to review in detail the terms and conditions of the licences issued to the licencee;

2. A copy of the terms and conditions in the licence should be maintained in both the office and on the vessel in a prominent location as a reminder;

3. Periodic random reviews of the logbook by the owner for completeness;

4. Periodic random comparisons of the information in the logbook with that on the Daily Catch Report for that date to ensure that the information corresponds;

5. A system for the imposition of warnings and discipline up to and including termination of employment for non-compliance or repeated non-compliance;

6. If necessary, a requirement that another crew-member initial the daily entries in the logbook to verify the information recorded.

53There is no question that the owner of the vessel must, to a large degree, repose its trust in the captain of the vessel. However, that trust cannot be blind trust. There must be a system of oversight by which the owner of the vessel can reasonably ascertain that the commitments made by it to the Ministry as a term of its license are being met. The above minimum steps are, in my view, reasonable and reflect the seriousness of the need for compliance.

54The Crown submitted that the standard of care that ought to apply should include an audit of all daily catch reports with the logbook and, possibly, the use of the GPS locator at different times of the year, including in periods where GPS locator is not mandated, as a spot check. Those suggestions go too far. If the Ministry wishes audited statements and the use of continual GPS location systems, that should be mandated through legislation after consultation with those engaged in the industry.

55I conclude that the trial judge failed to consider both what a proper system would encompass and the standard to be met by the defendant to demonstrate that all reasonable care was taken to ensure compliance.

Application of Incorrect Standard

56Clearly, the trial judge did not address the minimum standards I have outlined above to the evidence and facts before him. His conclusion that there was little more that Pisces could do is palpably incorrect. There is no compelling reason in the evidence why Mr. Barbosa could not go on to the vessel when it was in port in Erieau for periodic inspections or to do a random cross-check between the logbook and the Daily Catch Reports he had received. Erieau is only 54 kilometers from the office and the vessel was in port most days by 2 p.m.. Likewise, there is nothing in the evidence to indicate that Mr. Barbosa drove home to Captain Pace that there would be serious consequences to his employment if he failed to comply with the terms of the licence.

57The finding of due diligence at trial must be set aside because the standard of care applied was incorrect and falls far below that which should have been applied. This is an error of law. Even if the application of the test to the facts before him is entitled to deference by this court, the trial judge’s conclusion that, in effect, there was nothing more the defendant could have reasonably done is, in my view, palpably incorrect. As indicated above, there was a myriad of measures open to the defendant that he did not employ. The evidence at trial does not establish on a balance of probabilities that the defendant acted with due diligence in relation to the matters charged during the period in question.

Disposition

58In light of my conclusions above, I allow the appeal, set aside the acquittals below and order that convictions be entered for each of the four charges as against Pisces Fishery Inc.. I remit the matter back to the Ontario Court of Justice for sentence.