Stetler et al. v. Agriculture, Food and Rural Affairs Appeal Tribunal (Ont.) et al., 2009 ONCA 234

• Judge: Moldaver, Gillese and Armstrong, JJ.A.
• Court: Court of Appeal (Ontario)
• Case Date: March 12, 2009
• Jurisdiction: Ontario
• Citations: 2009 ONCA 234;(2009), 247 O.A.C. 338 (CA)

Stetler v. Agriculture Appeal Tribunal (2009), 247 O.A.C. 338 (CA)

MLB headnote and full text

Temp. Cite: [2009] O.A.C. TBEd. MR.064

Wyatt Stetler and 934671 Ontario Limited (applicants/respondents) v. The Ontario Flue-Cured Tobacco Growers' Marketing Board (respondent/appellant) and The Agriculture, Food and Rural Affairs Appeal Tribunal (respondent/respondent)

(C49101; 2009 ONCA 234)

Indexed As: Stetler et al. v. Agriculture, Food and Rural Affairs Appeal Tribunal (Ont.) et al.

Ontario Court of Appeal

Moldaver, Gillese and Armstrong, JJ.A.

March 16, 2009.

Summary:

A tobacco farmer and his corporation sought judicial review from a decision of the Agriculture, Food and Rural Affairs Appeal Tribunal, which affirmed the decision of the Ontario Flue-Cured Tobacco Growers' Marketing Board that the farmer and his corporation had engaged in illegal tobacco sales and that their quota be cancelled.

The Ontario Divisional Court, in a decision reported at 179 O.A.C. 398, allowed the application and quashed the decisions of the Board and the Appeal Tribunal. The Board obtained leave to appeal. In the event the appeal was successful, the farmer and his corporation requested that the penalty imposed by the Appeal Tribunal be reduced.

The Ontario Court of Appeal, in a decision reported at 200 O.A.C. 209, allowed the appeal, set aside the decision of the Divisional Court, reinstated the decision of the Tribunal on the findings respecting liability, and remitted the matter to the Appeal Tribunal to reconsider, as it deemed appropriate, the issue of penalty. Leave to appeal was refused by the Supreme Court of Canada (see 352 N.R. 196). A penalty hearing was convened by the Appeal Tribunal. The Appeal Tribunal ordered that the Board cancel all of the farmer's Basic Production Quota as of April 25, 2002, subject to some right to purchase quota in future. The farmer and his corporation sought judicial review.

The Ontario Divisional Court, Swinton, J., dissenting, in a decision reported at 234 O.A.C. 366, allowed the application and directed that the matter be sent back for a rehearing. The Board appealed. The farmer and his corporation asked that the appellate court vary the decision by substituting its own decision as to penalty, rather than remitting it to the Appeal Tribunal for a further reconsideration.

The Ontario Court of Appeal dismissed the appeal and set aside the part of the decision below which remitted the matter of penalty to the Appeal Tribunal. As a result Stetler's basic production quota was reinstated.

Administrative Law - Topic 9106

Boards and tribunals - Judicial review - Remedies available - [See last Trade Regulation - Topic 3697 ].

Courts - Topic 2101

Jurisdiction - Appellate jurisdiction - General - [See last Trade Regulation - Topic 3697 ].

Trade Regulation - Topic 3697

Marketing of agricultural products - Tobacco - Offences - Penalties - After a lengthy period of appeals and judicial review, a farmer and his corporation were found to have engaged in the unlawful sale of tobacco outside the auspices of the Ontario Flue-Cured Tobacco Growers' Marketing Board and the quota system - The Agriculture, Food and Rural Affairs Appeal Tribunal ordered that the Board cancel all of the farmer's Basic Production Quota as of April 25, 2002, subject to some right to purchase quota in future - The Ontario Divisional Court allowed the farmer's and his corporation's judicial review application, holding that the Appeal Tribunal's reconsideration decision was unreasonable - The Ontario Court of Appeal agreed that the decision was unreasonable - The Appeal Tribunal fundamentally misconceived its role when engaged in a reconsideration of penalty - It understood that when reconsidering the penalty to be imposed, it was to stand in the shoes of the Appeal Tribunal in 2002 and review the record as it stood at that time and was not to consider evidence of events that occurred following 2002 - That narrow approach was unreasonable and was not consistent with the first order of the Court of Appeal, which directed the Appeal Tribunal to undertake a full reconsideration of penalty - The Appeal Tribunal erred by not considering evidence of matters occurring after 2002 - It should have considered the significant adverse effects of these legal proceedings on Stetler's health and financial affairs and the Board's repeated refusals to permit him to buy fresh quota - See paragraphs 25 to 33.

Trade Regulation - Topic 3697

Marketing of agricultural products - Tobacco - Offences - Penalties - After a lengthy period of appeals and judicial review, a farmer and his corporation were found to have engaged in the unlawful sale of tobacco outside the auspices of the Ontario Flue-Cured Tobacco Growers' Marketing Board and the quota system - The Agriculture, Food and Rural Affairs Appeal Tribunal ordered that the Board cancel all of the farmer's Basic Production Quota as of April 25, 2002, subject to some right to purchase quota in future - The Ontario Divisional Court allowed the farmer's and his corporation's judicial review application, holding that the Appeal Tribunal's reconsideration decision was unreasonable - The Ontario Court of Appeal agreed that the decision was unreasonable because, inter alia, it found that there were no mitigating factors in the farmer's favour - His age (70) and poor health were mitigating factors as was the fact that he had never been charged with any regulatory or criminal offence - He had been a tobacco farmer for his entire life - A total cancellation of his tobacco quota stripped him of his vocation and his livelihood, and deprived him and his family of the way of life they had shared for the past 70 years - Also, he had complied with all regulatory and governmental dictates, before and after the incidents in question - It could not seriously be contended that there was any risk of him re-offending if his quota, or some portion thereof, was returned to him - Thus, specific deterrence was not an issue - See paragraphs 34 to 36.

Trade Regulation - Topic 3697

Marketing of agricultural products - Tobacco - Offences - Penalties - After a lengthy period of appeals and judicial review, a farmer and his corporation were found to have engaged in the unlawful sale of tobacco outside the auspices of the Ontario Flue-Cured Tobacco Growers' Marketing Board and the quota system - The Agriculture, Food and Rural Affairs Appeal Tribunal ordered that the Board cancel all of the farmer's Basic Production Quota as of April 25, 2002, subject to some right to purchase quota in future - The Ontario Divisional Court allowed the farmer's and his corporation's judicial review application, holding that the Appeal Tribunal's reconsideration decision was unreasonable - The Ontario Court of Appeal agreed that the decision was unreasonable because, inter alia, the Appeal Tribunal gave no consideration to the number of times a person had engaged in unlawful activity or to the quantities of tobacco which had been unlawfully sold - Every unlawful sale of tobacco was serious - However, it did not mean that every such sale warranted the most serious of penalties (i.e., cancellation of 100% of the production quota) - There had to be some degree of proportionality between the wrongdoing and the penalty imposed - The importance of proportionality was particularly significant where, as here, a person's livelihood was at stake - In this case, two infractions occurred within a four-month period following a farming career that spanned several decades without incident - The amounts improperly sold amounted to approximately 2.6% of the farmer's basic production quota - The effect of total cancellation of his basic production quota was crushing as, given his age and background, he had no real opportunity to rebuild his life in a different place and with a different vocation - He was, in effect, given "capital punishment" for his transgressions - See paragraphs 37 and 38.

Trade Regulation - Topic 3697

Marketing of agricultural products - Tobacco - Offences - Penalties - After a lengthy period of appeals and judicial review, a farmer and his corporation were found to have engaged in the unlawful sale of tobacco outside the auspices of the Ontario Flue-Cured Tobacco Growers' Marketing Board and the quota system - The Agriculture, Food and Rural Affairs Appeal Tribunal ordered that the Board cancel all of the farmer's Basic Production Quota as of April 25, 2002, subject to some right to purchase quota in future - The Ontario Divisional Court allowed the farmer's and his corporation's judicial review application, holding that the Appeal Tribunal's reconsideration decision was unreasonable - The Ontario Court of Appeal agreed that the decision was unreasonable because, inter alia, it did not appear that the Appeal Tribunal considered the full range of penalties available to it and then fashioned a remedy that appropriately reflected the seriousness of the offence and the situation of the offender - In reconsidering the penalty, the Appeal Tribunal was exercising the powers of the Board - However, it meted out the most severe punishment available, without any apparent consideration of the range of possible penalties and whether something less than full cancellation of the farmer's basic production quota could meet the appropriate sentencing objectives - See paragraphs 39 and 40.

Trade Regulation - Topic 3697

Marketing of agricultural products - Tobacco - Offences - Penalties - After a lengthy period of appeals and judicial review, a farmer and his corporation were found to have engaged in the unlawful sale of tobacco outside the auspices of the Ontario Flue-Cured Tobacco Growers' Marketing Board and the quota system - The Agriculture, Food and Rural Affairs Appeal Tribunal ordered that the Board cancel all of the farmer's Basic Production Quota as of April 25, 2002, subject to some right to purchase quota in future - The Ontario Divisional Court allowed the farmer's and his corporation's judicial review application, holding that the Appeal Tribunal's reconsideration decision was unreasonable - The Ontario Court of Appeal agreed that the decision was unreasonable - In all but exceptional circumstances, if a regulatory body erred when imposing penalty, deference required that the matter should be remitted for reconsideration - However, the parties agreed that, pursuant to s. 134(1) of the Courts of Justice Act, the court had the jurisdiction to impose the appropriate penalty in this matter rather than remit it to the Appeal Tribunal - Given the history of this matter, the court reinstated the farmer's basic production quota - This is an exceptional case and the matter had to end here - No matter what the appropriate penalty was, the farmer had more than served it - Apart from some partial relief in 2005, the farmer had been deprived of his livelihood and way of life for the better part of a decade - He had suffered enormously in these legal proceedings - That suffering included financial ruin, or something very close to it - It extended to his health and the crushing impact on his family - The process itself had been the punishment - Reinstatement would allow him to take advantage of a federal government buyout program for tobacco farmers which had an impending deadline for acceptance - See paragraphs 41 to 47.

Trade Regulation - Topic 9165

Offences - Sentencing - General - Considerations - Previous conduct - [See second Trade Regulation - Topic 3697 ].

Trade Regulation - Topic 9165.1

Offences - Sentencing - General - Post-offence conduct - [See first Trade Regulation - Topic 3697 ].

Cases Noticed:

Commercial Union Assurance and Cormack v. Human Rights Commission (Ont.) and Prashad (1987), 23 O.A.C. 148; 59 O.R.(2d) 481 (Div. Ct.), affd. (1988), 26 O.A.C. 387; 63 O.R.(2d) 112 (C.A.), refd to. [para. 29].

Jamal v. Ontario Public Service Employees Union et al. (2005), 203 O.A.C. 119 (Div. Ct.), refd to. [para. 29].

Minalu et al. v. Sims et al., [2006] O.T.C. 64 (Sup. Ct.), refd to. [para. 29].

Carruthers v. College of Nurses (Ont.) (1996), 96 O.A.C. 41; 31 O.R.(3d) 377 (Div. Ct.), refd to. [para. 37].

Pavelic v. Royal College of Dental Surgeons (Ont.), [1998] O.A.C. Uned. 276 (Div. Ct.), refd to. [para. 37].

Giguère v. Chambre des notaires du Québec, [2004] 1 S.C.R. 3; 315 N.R. 346, refd to. [para. 42].

Denby et al. v. Agriculture, Food and Rural Affairs Appeal Tribunal (Ont.) et al. (2006), 216 O.A.C. 130 (Div. Ct.), refd to. [para. 43].

Illidge (Bankrupt) et al. v. St. James Securities Inc. et al. (2002), 159 O.A.C. 311; 60 O.R.(3d) 155 (C.A.), refd to. [para. 48].

Sengmueller v. Sengmueller (1994), 69 O.A.C. 312; 17 O.R.(3d) 208 (C.A.), refd to. [para. 48].

Counsel:

Barry H. Bresner and Melanie E. De Wit, for the appellant;

Peter Brauti and Matthew R. Barteaux, for the respondents.

This appeal was heard on March 12, 2009, by Moldaver, Gillese and Armstrong, JJ.A., of the Ontario Court of Appeal. The following decision of the court was delivered on March 16, 2009, by Gillese, J.A.