Ken Allan c. Director (demande de requête)

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In the matter of the Livestock Medicines Act, R.S.O.1990, Chapter L.23 and Ontario Regulation 730 under the Act.

And in the matter of: An Appeal to the Agriculture, Food and Rural Affairs Appeal Tribunal by Ken Allan, of Perth, Ontario, under Section 9(1) of the Livestock Medicines Act from a decision of the Director under the Act, dated July 8, 2010, (reasons dated December 7, 2010) in which the Director revoked the Class 1 Licence issued to Ken Allan.

And in the matter of: A request for review by the Ontario Ministry of Agriculture, Food and Rural Affairs of the Decision of the Tribunal dated July 15, 2011 under Subsection 21.2(1) of the Statutory Powers Procedure Act and Rule 29 of the Rules of Procedure for the Tribunal.

Before: Paula Lombardi, Vice Chair

Background to Review Request

The Director appointed under the Livestock Medicines Act ("Director") held a hearing on July 7, 2010 to consider whether to further suspend or revoke the Class 1 licence issued to Mr.¹ Ken Allan to sell livestock medicines under the Livestock Medicines Act ("Act").

Mr. Allan was delivered a letter on May 14, 2010 advising that his Class 1 licence to sell livestock medicines had been revoked based on incidents that occurred on May 10, 2010, specifically Mr. Allan's refusal to allow the inspector to inspect his pick-up truck at the Ottawa Livestock Exchange ("Provisional Suspension letter"). A series of inspections2 occurred under the Act, its regulations, and the Standards of Compliance Manual (revised) August 2005 ("Compliance Manual") prior to the Director sending Mr. Allan the Provisional Suspension letter.

The Provisional Suspension letter stated that the Director had grounds to believe that Mr. Allan was, contrary to the Act, using his truck to convey livestock medicines and requested that Mr. Allan surrender all livestock medicines in his possession. This letter was delivered to Mr. Allan by Inspectors Richardson and Cross; both are inspectors appointed under the Act. The Provisional Suspension letter was read to Mr. Allan and, according to the inspectors, Mr. Allan acknowledged the contents of the letter. Mr. Allan refused to surrender the livestock medicines in his possession and advised the inspectors that a warrant would be required.

On June 10, 2010, Inspector Cross and Mr. Ridley, an Investigation and Intelligence Specialist from the Ministry of Natural Resources ("Inspector Ridley"), delivered the Notice of Hearing advising that a hearing on whether to further suspend or revoke Mr. Allan's Class I licence to sell livestock medicines was scheduled before the Director on July 7, 2010.

The hearing proceeded in accordance with the Notice on July 7, 2010. Mr. Allan: did not attend the hearing; did not request an adjournment of the hearing to a later date; did not send a letter to respond to the allegations set out in the Notice; and did not send a representative to the hearing advising that he was unable to attend due to scheduling conflicts.

At the hearing of July 7, 2010, the Director revoked Mr. Allan's licence to sell livestock medicines and ordered that any livestock medicines in the possession of Mr. Allan be removed and disposed of under the supervision of an inspector pursuant to the section 12(c)3 of Regulation 730 of the Livestock Medicines Act ("Regulation 730").

Mr. Allan appealed to the Tribunal, under section 9(1)4 of the Act, the Director's oral decision of July 8, 2010 and subsequent written reasons dated December 7, 2010.
After the release of the Director's oral decision of July 8, 2010, a search warrant was issued on July 27, 2010 by a Justice of the Ontario Court of Justice pursuant to the Provincial Offences Act ("POA") to obtain livestock medicines and documents from Mr. Allan's home. Neither a copy of the search warrant nor any evidence with respect to the proceedings before the Provincial Court relating to the issuance of the search warrant was presented to the Tribunal at the hearing.

In the Director's request for review, information is provided with respect to the issuance of the search warrant as requested by investigators with the Ministry of Natural Resources, although available at the time of the appeal, this information was not brought before the Tribunal.

The Tribunal defined the issues for determination on appeal as:

1. Did Dr. Allan sell livestock medicines in contravention of the Act?
2. Did Dr. Allan leave the licensing system prior to receiving the letter revoking his licence?
3. Should the livestock medicines and other property seized by the Ministry be returned to Dr. Allan?
   

Under section 9(3) of the Act, on appeal from a decision of the Director, the Tribunal conducts a hearing de novo to determine whether the licence should be suspended or revoked and may make any decision that the Director could make.
The Tribunal released its reasons for decision on July 15, 2011, and found that Mr. Allan had voluntarily resigned from the licensing system under the Act. The Tribunal ordered: that any prescription and livestock medicines seized pursuant to a warrant be returned to Mr. Allan; that if for whatever reason the medicines could not be returned, Mr. Allan be compensated for the loss; and, that the items belonging to Mr. Allan that were removed during the execution of a search warrant be immediately returned. The Tribunal also ordered that Mr. Allan's voluntary resignation not be considered negatively in the event Mr. Allan seeks to reapply for a licence at some time in the future.
On July 26, 2011, the Director requested a review of the Tribunal's decision and asked for a reconsideration of that decision and that the decision be rescinded. In the alternative, the Director requested that portions of the Tribunal's decision be suspended until such time as the charges pending before the Ontario Court of Justice are finally disposed of.

The Tribunal's Rules of Procedures ("Rules")

Pursuant to section 25.1 of the Statutory Powers Procedure Act ("SPPA"), the Tribunal has established Rules of Procedure ("Rules") that includes Rule 29, which is entitled "Review of a Decision." Rule 29.09 of the Tribunal's Rules reads as follows:
Evaluation of request for review
29.09 In deciding whether it is advisable to conduct a review of all or any part of a final decision or order, the Tribunal may consider any relevant circumstances including:

1. whether there is significant new evidence which was not available at the time of the original appeal;
2. whether the Tribunal made a material error of law or fact such that the Tribunal would likely have reached a different decision;
3. the extent to which any party to the appeal or any other person has relied upon the final decision or order;
4. the extent to which any party to the appeal or any other person will be affected by the review process; and
5. whether the public interest in finality of decisions is outweighed by the alleged prejudice to the requester.

Rule 29.09 provides that in determining the prudence of a review I may consider any relevant circumstances including those listed in subsections (a) to (e) of that Rule.

The Rules permit that I can confer with the members of the appeal panel; I choose not to do so and did not seek out their explanation, preferring to allow the decision to stand on its own. In the course of reviewing the decision, all the materials provided by the parties have been considered 5, and, in accordance with Rule 19.18 of the Tribunal's Rules, submissions from Mr. Allan with respect to the Director's request for review were considered. Counsel for the Director was also provided the opportunity to reply to the submissions made by Mr. Allan and that document has also been considered.

The Director's Reasons for the Request for Review

1. The basis upon which the Director is seeking a request for review can be summarized into the following two main headings:
   Does the Tribunal have the statutory authority to make an Order requiring the return of either personal items, livestock medicines and/or prescription medicines seized pursuant to a search warrant issued by His Worship C.A. McKechnie, Justice of the Peace, Ontario Court of Justice; and
2. Does the Tribunal have the jurisdiction to Order compensation for any livestock medicines or prescription medicines that have expired, been destroyed or disposed of during the course of the seizure that occurred pursuant to a search warrant?
   

Findings and Analysis

1. Does the Tribunal have the statutory authority to make an Order requiring the return of either personal items, livestock medicines and/or prescription medicines seized pursuant to a search warrant issued by His Worship C.A. McKechnie, Justice of the Peace, Ontario Court of Justice?

The hearing before the Director of whether to revoke or suspend Mr. Allan's licence proceeded in accordance with the Notice of Hearing on July 7, 2010. At the hearing of July 7, 2010, the Director revoked Mr. Allan's licence to sell livestock medicine and ordered that any livestock medicines in the possession of Mr. Allan be removed and disposed of under the supervision of an inspector pursuant to the section 12(c) of Regulation 730 of the Livestock Medicines Act ("Regulation 730").

Section 12(c) of Regulation 730 states:

Where a licence is refused, suspended or revoked, any livestock medicines in the possession of the applicant or licensee shall be removed and disposed of under the supervision of an inspector by, … (c) any other method satisfactory to the Director.

Section 9(1) of the Act states:

Where the Director refuses to issue or renew or suspends or revokes a licence, the applicant or licensee may by written notice delivered to the Director and filed with the Tribunal within fifteen days after receipt of the decision of the Director appeal to the Tribunal.

The appeal before the Tribunal was heard pursuant to section 9(3) of the Act which states:

Where an applicant or licensee appeals to the Tribunal under this section, the Tribunal shall hear the appeal by way of a new hearing to determine whether the licence should be issued, renewed, suspended or revoked and may after the hearing confirm or alter the decision of the Director or direct the Director to do any act the Director is authorized to do under this Act and the regulations and as the Tribunal considers proper and, for such purpose, the Tribunal may substitute its opinion for that of the Director. [emphasis added]

According to submissions made in the Director's request for review, a search warrant was issued on July 27, 2010 by a Justice of the Ontario Court of Justice pursuant to the requirements of the Provincial Offences Act ("POA"). The issuance of the search warrant and the events that took place after the hearing of July 7, 2010 were not at issue in the original hearing held by the Director on the issue of the status of Mr. Allan's licence, nor were they before the Tribunal. It is also noted that the issues arising as they relate to the items seized pursuant to the search warrant were not appealed to the Tribunal by Mr. Allan. No evidence regarding the search warrant or any court proceeding(s) was presented to the Tribunal panel at the hearing of the appeal, only Mr. Allan's testimony about what was seized and the possible losses he incurred.

Mr. Allan's appeal letter of December 29, 2010 states that he is appealing the decision of the Director regarding the licensing hearing of July 7, 2010. Mr. Allan's appeal rights under the Act only relate to the Director's decision under section 9 of the Act which requires the Tribunal to hear the appeal and determine whether Mr. Allan's licence should be issued, renewed, suspended or revoked. The jurisdiction of the Tribunal on this matter is limited to the Director's authority under the Act.

The details relating to the issuance of the search warrant were first presented to the Tribunal by the Ministry in the Director's request for review dated July 26, 2011. It would have been of assistance to the Tribunal panel hearing the appeal if the Ministry clarified the issues relating to the search warrant when Mr. Allan made reference to the damages arising from the execution of the search warrant in his oral testimony.

It is noted that the hearing held by the Director concerning the status of Dr. Allan's licence was held twenty (20) days prior to the issuance of the search warrant on July 27, 2010 by His Worship C.A. McKechnie, Justice of the Peace of the Ontario Court of Justice ("Court"). According to the Ministry's request for review, the search warrant was issued to aid in the investigation of alleged offences committed by Mr. Allan under the Act that are pending before the Court. Mr. Allan confirmed, during his testimony before the Tribunal, that the items seized from his house were taken pursuant to the search warrant.

The Director requested a review of the Tribunal's decision on the basis that the search warrant was not requested by the Director nor issued by the Director, and is in no way related to the Director's decision to suspend or revoke Mr. Allan's licence. The Ministry's position is that the Director has no statutory authority to order the return of the items seized from Mr. Allan pursuant to the search warrant issued by the Provincial Court of Justice. Therefore, it was the Ministry's view that the Tribunal has no authority to interfere with, or make a decision relating to, matters arising out of the issuance of a search warrant pursuant to the Provincial Offences Act ("POA").

The POA gives jurisdiction to a justice of the peace (in this case) to issue a search warrant under section 1586 of the POA upon being satisfied by an information sworn under oath that there are reasonable grounds to believe that an offence has or is suspected to have been committed, or that there are reasonable grounds to believe that evidence will be obtained as to the commission of an offence. It is the provincial judge or justice of the peace that must be satisfied by the information provided that a warrant should be issued in the circumstances.

It is the Ministry's position on the request for review that the Director had no involvement whatsoever in determining whether or not a warrant should be issued and how the warrant should be executed.

Section 159(4) of the POA provides a mechanism whereby Mr. Allan can bring a motion to request the release of the detained item(s) where it appears that the continued detention of the item(s) is no longer necessary for the purpose of an investigation or proceeding. Mr. Allan had every opportunity after the items were seized on July 27, 2010 and prior to the Tribunal hearing on March 30th and 31st, 2011 to bring a motion under the POA before a justice7 to obtain an order requiring the release of the seized items.

Based on my review of the materials, I find that the evidence relating to the search warrant was not before the Tribunal and therefore the only issue to be determined by the Tribunal related to the Director's decision to revoke Mr. Allan's licence under the Act. The Director has provided sufficient information in its request for review to indicate that the Tribunal exceeded its jurisdiction when it ordered the return of Mr. Allan's items that were taken pursuant to a search warrant issued under the POA.

2. Does the Tribunal have the jurisdiction to Order compensation for any livestock medicines or prescription medicines that have expired, been destroyed or disposed of during the course of the seizure that occurred pursuant to a search warrant?

Absent a constitutional or human rights challenge, the jurisdiction of the Tribunal on appeal under the Act is limited to the statutory authority of the Director. The Director does not have the statutory authority under section 9 of the Act to order compensation for damages arising from seized livestock medicines.

The Act gives inspectors, not the Director, in section 3(3) the discretionary authority to inspect a person licensed under the Act and in subsection 3(5) to seize, remove or detain any livestock medicines and/or require the production of books, records or documents during an inspection or, under subsection 3(4) , if an inspector has reasonable and probable grounds to believe livestock medicines are being sold without a licence.

Section 3(5) of the Act states:

Upon an inspection under subsection (3) or (4) …, an inspector may,

(a) require the production or furnishing by the owner or custodian thereof of any books, records, documents or extracts therefrom of the person being inspected;
…
(c) seize, remove or detain at the risk and expense of the owner any livestock medicine where the inspector believes on reasonable and probably grounds that,

1. the licensee is contravening the provisions of this Act or the regulations relating to the livestock medicine, or
2. the person being inspected is not authorized under this Act or any other Act to sell livestock medicines to owners of livestock for the treatment of livestock.

The Act makes it clear that any livestock medicines taken pursuant to the inspector's exercise of his or her discretionary authority based on reasonable and probable grounds of a violation of paragraphs 3(5)(c)(i) or (ii) are expressly at the risk and expense of the owner.

The Director's statutory authority to require the removal of livestock medicines is set out in section 12(c)8 of Regulation 730. The Director's authority, unlike the inspector's, is not discretionary; the Director is required, when a licence is revoked or suspended to remove or dispose of livestock medicines in the possession of the individual whose licence was revoked. Regulation 730 requires that Director to remove and dispose of any livestock medicines in the possession of the licensee upon the revocation, or suspension of their licence. The regulatory requirements do not provide the Director with any authority to order compensation to an individual whose livestock medicines are removed and disposed of when the Director revokes a licence under the Act.

In Mr. Allan's circumstances, upon the provisional suspension in May 2010, the Director, in fulfillment of his statutory duties, required the inspector to supervise the removal of the livestock medicines in Mr. Allan's possession. However, Mr. Allan refused to allow the inspector to take the livestock medicines and this mandatory requirement was not fulfilled by the Director. In both circumstances - the inspector's authority to remove the livestock medicines set out in the Act and the requirement that the Director is obligated to remove livestock medicines when a licence is suspended or revoked under Regulation 730 - there is no authority under which the Director can order compensation to an individual for damages arising from the loss of the livestock medicines. The Tribunal's statutory authority on hearing the appeal is limited to the statutory authority of the Director, unless there is a claim relating to a constitutional or human rights violation which would expand the Tribunal's jurisdiction. The appeal of Mr. Allan to the Tribunal did not raise any claims which would result in an expansion of the Tribunal's jurisdiction and, as a result, the Tribunal has no statutory authority to order compensation for the removal of livestock medicines from Mr. Allan's premises under the Act or its regulations.

More importantly, in the circumstances of this case, both the Director and Mr. Allan agree that the items removed from Mr. Allan's premises were pursuant to a search warrant. According to submissions made on the request for review of the Tribunal's appeal decision, the search warrant was issued by the Ontario Court of Justice under the POA and therefore any issues, including any damages, arising from the execution of the search warrant are outside of the jurisdiction of the Tribunal and fall squarely within the jurisdiction of the Ontario Court of Justice.

The Director has provided sufficient information in the request for review to indicate that the Tribunal exceeded its jurisdiction in ordering compensation for any livestock medicines that were taken pursuant to a search warrant.

Issue of Costs

Rule 28.02 of the Rules allows the Tribunal to make costs award at any time during a proceeding. Rule 28.04 of the Tribunal's Rules governs the circumstances constituting bad faith conduct upon which the Tribunal may make a costs award. These circumstances include but are not limited to: the failure to attend a hearing event; failing to act in a timely manner or comply with a procedural order or direction of the Tribunal; conduct necessitating unnecessary adjournments or delays or failing to prepare adequately for a hearing event; failing to present evidence; acting disrespectfully; and knowingly presenting false or misleading evidence. Prior to making a determination of costs, the Tribunal has an obligation to consider the seriousness of the misconduct.

The actions of the Director cannot be found to be frivolous, vexatious or in bad faith and, as such, no costs are awarded.

Decision of the Tribunal

The request for review is hereby granted. In accordance with Rule 29.24 of the Tribunal's Rules of Procedure the review of the Tribunal's decision is ordered to proceed by way of a written hearing.

Dated at London, Ontario, this 20th day of October, 2011.

_______________________________________

Notes:

¹It is noted that the documents interchangeably refer to Mr. Allan as Dr. Allan and vice versa. The term "Mr." is used throughout this review decision because in the originating appeal filed with the Tribunal it is signed by "Mr." Allan.

²Inspectors are appointed by the Minister of Agriculture, Food and Rural Affairs.

³Section 12(c) of Regulation 730 states: "Where a licence is refused, suspended or revoked, any livestock medicines in the possession of the applicant or licensee shall be removed and disposed of under the supervision of an inspector by, … (c) any other method satisfactory to the Director."

⁴Section 9(1) of the Act states: "where the Director refuses to issue or renew or suspends or revokes a licence, the applicant or licensee may by written notice delivered to the Director and filed with the Tribunal within fifteen days after receipt of the decision of the Director appeal to the Tribunal."

⁵As part of considering the Director's review request, I reviewed the following materials: Livestock Medicines Act, Regulation 730 of the Livestock Medicines Act; The Ontario Livestock Medicines Act and Regulations, Standards of Compliance Manual, (revised) August, 2005 ("Compliance Manual"); Her Majesty the Queen v. Gerald O'Hara; Incident Report dated May 2010; Synopsis by Compliance Officer Carolyn Cross; Licence to sell livestock medicines issued to Ken Allan January 8, 2010; Craig Richardson's will say statement and notes; Carolyn Cross's will say statement and notes; Graham Ridley's Occurrence Report dated June 11, 2010 and notes; Curriculum Vitae of Dr. Steven Palmer and anticipated opinion evidence dated March 11, 2011; letter provisionally suspending Ken Allan's licence to sell livestock medicines dated May 14, 2010; Livestock Medicines inspection reports; photographs and notes by Craig Richardson; exhibits from the hearing before the Director on July 7, 2010; Oral decision from the July 7, 2010 hearing dated July 8, 2010; decision of the Tribunal dated July 15, 2011; Director's written reasons dated December 7, 2010 from hearing held July 7, 2010; Director's request for review dated July 26, 2011; Mr. Allan's submissions to the Director's request for review dated August 8, 2011; Director's reply to Mr. Allan's submissions dated August 11, 2011;

⁶The Act sets out the authority of an inspector including the authority to enter buildings; section 3(5)(c) provides that an inspector can seize, remove or detain at the risk and expense to the owner any livestock medicine on the grounds set out in the Act. Also section 3(6) provides the authority for an inspector to enter a dwelling under the authority of a warrant under section 158 Provincial Offences Act.

⁷Justice is defined as either a provincial judge or justice of the peace

⁸Section 12 states "Where a licence is refused, suspended or revoked, any livestock medicines in the possession of the applicant or licensee shall be removed and disposed of under the supervision of an inspector by,

1. their sale to a person authorized to sell livestock medicines;
   
2. their return to the supplier of livestock medicines, or
   
3. any other method satisfactory to the Director.