The job of a regulator is challenging. It must, at times, balance the protection of consumers with the right of an individual to conduct business. In some instances however the decisions are, at least seemingly, simple.

Such was the case of Robert Vernon. In May of 2014 Mr. Vernon, who held citizenship in Australia, the US and Canada, applied a salesperson's licence from OMVIC, Ontario's vehicle sales regulator. The application came only six days after his release from a US prison where he had just finished serving a five-year sentence for arson.  Vernon had been convicted and imprisoned after hiring an arsonist to firebomb the office of a NY State Department of Motor Vehicle (DMV) office and car of a DMV inspector. Vernon operated two car dealerships in Buffalo at the time. In his application to OMVIC,Vernon made false statements about his past and tried to absolve himself from wrongdoing in relation to the arson claiming the man who’d been hired and paid by him, misunderstood his intentions.

OMVIC denied Vernon a licence stating he had failed to meet requirements under the Motor Vehicle Dealers Act (MVDA) necessary for registration in Ontario. Specifically, Vernon had made a “false statement” on his application; and his past conduct afforded reasonable grounds for the belief that he would not carry out business in accordance with the law and with honesty and integrity.

To Help Protect Consumers Dealers Must Be Licensed 

“This was an individual who’d been convicted and jailed for firebombing the offices and vehicle of a US regulator and then tried to mislead OMVIC in order to gain registration here,” explained Mary Jane South, OMVIC Registrar. “There was no way we thought this man was entitled to registration.”

So imagine OMVIC’s surprise when Vernon appealed the decision to Ontario’s Licence Appeal Tribunal, who ordered OMVIC to issue Vernon a licence. “We were alarmed by the LAT decision,” stated South. “While OMVIC protects consumers by investigating and prosecuting misconduct by registrants, the protection begins in the registration process by keeping people out of the industry who are not likely to abide by the rules. This decision was dangerous and we appealed it to the courts.”

Last week, the Ontario Superior Court of Justice overturned LAT’s decision finding the “Tribunal made errors in law, with the result that its decision does not fall within a range of reasonable outcomes.” Normally, on an appeal from an administrative tribunal, the matter is referred back to the Tribunal for a new hearing. However, in this case the court found no reason to send the matter back, as the only reasonable conclusion is that Vernon is “disentitled to registration” due to the false information provided on his application and that, due to his past conduct, there was no reasonable grounds for the belief that he would conduct business in accordance with the law and with honesty and integrity. 

According to Michael Rothe, OMVIC Director of Legal Services, this was an incredibly important ruling. “Had the tribunal’s decision been allowed to stand, OMVIC’s ability to protect consumers by keeping out individuals who might prey on them would have been dramatically reduced. This is a good day for Ontario’s car buyers and the industry at large.”

About OMVIC

OMVIC (Ontario Motor Vehicle Industry Council) administers and enforces the Motor Vehicle Dealers Act on behalf of the Ministry of Government and Consumer Services. OMVIC maintains a fair and informed vehicle sales marketplace by regulating dealers and salespersons, regularly inspecting Ontario's 8,000 dealerships and 26,000 salespeople, maintaining a complaint line for consumers and conducting investigations and prosecutions of industry misconduct and illegal sales (curbsiding). OMVIC is also responsible for administering the Motor Vehicle Dealers Compensation Fund on behalf of its Board of Trustees.

For More Information omvic.ca