Fulber v. Doll

2001BCSC0891 Citation: Fulber v. Doll Date: 20010620 2001 BCSC 891 Docket: L010761 Registry: Vancouver IN THE SUPREME COURT OF BRITISH COLUMBIA IN THE MATTER OF THE RESIDENTIAL TENANCY ACT, R.S.B.C. 1996, c. 406 BETWEEN: RALPH C. FULBER, RONALD K. FULBER AND FILOMENA FULBER PETITIONERS AND: ARBITRATOR A. DOLL, IN HER CAPACITY AS ARBITRATOR APPOINTED PURSUANT TO THE RESIDENTIAL TENANCY ACT, R.S.B.C. 1996, C. 406 RESPONDENT REASONS FOR JUDGMENT OF THE HONOURABLE MADAM JUSTICE LYNN SMITH Counsel for the Petitioner: M.K. Woodall Counsel for the Respondent: J.M. Loenen Counsel for PricewaterhouseCoopers Inc.: J.D. McNaught Date and Place of Hearing: Vancouver, BC March 30, 2001 Introduction [1] Can a landlord evict tenants who are charged with growing marijuana on the rented premises? The arbitrator concluded that in this case the answer was "yes". [2] The tenants have petitioned for judicial review of her decision. What I must decide is whether the arbitrator made errors of law or procedure such that this court should intervene and quash her orders. Facts [3] The petitioners are tenants of houses at Shaughnessy Heights, Britannia Beach. Copper Beach Estates Ltd. owns the houses, the now-defunct mine and the associated residential area. The receiver-manager for Copper Beach Estates Ltd. is PricewaterhouseCoopers ("the landlord"). [4] The tenancies at issue are of house #160 by Ralph Fulber (since January 1, 1985), house #161 by Ronald Fulber (since July 1, 1989) and house #159 by Ralph Fulber (since June 15, 1988). The top half of house #159 is sublet to Mr. Quirk, who is not a party to these proceedings. [5] On June 14, 2000 the petitioners Ralph Fulber, Ronald Fulber and his wife Filomena Fulber were all charged with growing marijuana in their homes. The charges are still pending; I was advised they are to go to trial this July. The petitioners have not been charged with possession for the purpose of trafficking, trafficking, or theft of electricity. [6] On June 21, 2000 the landlord issued notices to end Ralph Fulber's tenancies of house #160 and house #159 and to end Ron Fulber's tenancy of house #161. The notices with respect to houses #160 and #161 were pursuant to s. 36(1)(f) of the Residential Tenancy Act, R.S.B.C. 1996, c. 406 (the "Act"), and with respect to house #159 were pursuant to s. 36(1)(k) and s. 40(1) of the Act. Those sections provide: 36 (1) A landlord may, at any time, give the tenant a notice of the end of the tenancy agreement in accordance with subsection (2) if any one of the following events has occurred: ... (f) the safety or other lawful right or interest of the landlord or other occupant in the residential property has been seriously impaired by an act or omission of the tenant or of a person permitted in or on the residential property or residential premises by the tenant; ... (k) the tenant has purported to assign or sublet the residential premises without the consent of the landlord. 40 (1) If a tenant has given reasonable cause to end a tenancy agreement in circumstances other than those described in section 35 or 36, a landlord may give the tenant a notice of the end of the tenancy agreement to be effective on the last day of an ensuing rental payment period but the period of notice must be at least 2 months. The notices were effective July 31, 2000 for houses #160 and #161 and August 31, 2000 for house #159. [7] The tenants applied for orders setting aside the notices and the landlord applied for orders of possession. The matter went to arbitration under the Act. [8] The landlord's position at the hearing was that there were sufficient grounds to end the tenancies of houses #160 and #161 in that marijuana was being cultivated in both houses, and of house #160 in that the tenant was stealing electricity from the landlord. [9] The arbitrator heard evidence regarding theft of electricity from the resident manager, Maurice Neill, who testified that he observed that the hydro meter for house #160 had been turned upside-down. He testified that the landlord purchases electricity in bulk from BC Hydro and distributes it to residents, and that his review of the records showed that consumption for house #160 was substantially higher than consumption for a house of similar size. [10] Mr. Neill testified to the arbitrator that he contacted the Royal Canadian Mounted Police. The police obtained search warrants with respect to both houses (#160 and #161). Mr. Neill attended at the houses when the warrants were executed, and testified that he saw numerous marijuana plants of varying sizes, marijuana in bags, numerous lights, electrical plugs, containers and soil in house #160. He testified that in house #161 he saw marijuana plants in an upstairs closet, noticed "excessive plugs in the light socket in the closet", and took photographs of the closet and the plants. [11] Mr. Neill also produced in evidence a letter from the R.C.M.P. dated June 20, 2000 confirming that "marihuana grow operations were located in each residence". [12] The arbitrator noted that Mr. Neill, under cross-examination, acknowledged that he is not an expert in the identification of marijuana and that he did not know the degree of maturity of the plants or whether they were for personal or commercial use. He stated to the arbitrator that he did not notice any structural alterations or additional wiring in the houses, but did notice extra plugs and lights. He agreed that he was not aware of any fire or safety hazard nor of any damage to either house, that he is not an electrician and did not know how much electricity the tenant Ralph Fulber allegedly stole. [13] None of the tenants appeared at the hearing or testified. [14] The sub-tenant of two floors of house #159, Christopher Quirk, was called by counsel for the tenants, as was Mike Mason, another resident in the community. Mr. Quirk said he was unaware of complaints about marijuana being grown in the premises. Mr. Mason said he had not noticed any damage to the houses. He acknowledged on cross-examination that the community is divided over issues of governance and development and that he is a member of the same faction as the tenants. [15] The landlord called Wendy Seery in rebuttal. She testified that she has lived in the Britannia Beach community for seven years and knows the tenants. She said that they are known for "running grow operations and selling drugs in the community" and that she would leave if the tenants were allowed to stay. On cross-examination she agreed that she had not personally observed the tenants selling drugs and that she had not been in either house #160 or #161. [16] The arbitrator reviewed the arguments of counsel for the landlord and counsel for the tenants and noted that the landlord has the burden of proving on a balance of probabilities the stated reasons for the termination of a tenancy. The arbitrator then stated that in the course of a hearing an arbitrator may accept hearsay evidence, although that kind of evidence will usually be given less weight than direct evidence. The arbitrator reached the following conclusions about the facts: I am persuaded on a balance of probabilities that the meter which measures electrical use for House #160 has been turned upside down, that the effect of this is to reduce the measured usage of electricity and that the measured electrical consumption at House #160 is significantly higher than that for a comparably sized house. I am persuaded on a balance of probabilities that marijuana was being cultivated in both House #160 and #161. I am persuaded on a balance of probabilities that electrical alterations have been made to House #160 and #161 in the form of additional lights and sockets. I am not persuaded that changes have been made to the structure of either House or that either House has otherwise been damaged. [17] Identifying the issue with respect to houses #160 and #161 as being whether "the safety or other lawful right or interest of the landlord or other occupant in the property has been seriously impaired", the arbitrator first concluded that since the only occupants of the houses were the tenants, there was no issue of safety of the landlord or other occupants of the property. Next, the arbitrator stated her disagreement with another arbitrator who, in Paradis v. Copper Beach Estates Ltd. (17 April 1998), No. 418922 (R.T.A.) had seemed to conclude that if an illegal activity is conducted on rented premises the lawful right or interest of the landlord will be seriously impaired. She noted that decisions of fellow arbitrators do not bind her, pursuant to s. 55(1)(b) of the Act, and rejected the arbitrator's interpretation in the Paradis case as overly broad. She referred to some recommendations in the Law Reform Commission of British Columbia Report on Landlord and Tenant Relationships: Residential Tenancies (Project No. 12) (1973), and stated: Based on the Report I have concluded that a more appropriate interpretation of Section 36(1)(f) of the Act is that a landlord will have a basis for terminating a tenancy if a tenant conducts an illegal activity on the premises which has a serious negative impact on the premises or on an interest of the landlord which is related to the premises. [18] The arbitrator concluded that the tenant of house #160 was using excess electricity and attempting to disguise that use by turning the hydro meter upside-down. She found that to be an act, related to the premises, negatively affecting the landlord's economic interest since the evidence was that electrical consumption was "significantly" higher than was normal for a house of that size. The arbitrator said that she was satisfied that constituted a serious impairment of the landlord's interest. [19] The arbitrator also held that it is not necessary for a landlord to prove damage to the premises in order to rely on s. 36(1)(f) of the Act, pointing out that there are other subsections (36(1)(b) and (c)) which provide for ending a tenancy on the basis of actual damage. She referred to an Information Bulletin from the Residential Tenancy Office dated May 2000, called "Measures to Protect Against Illegal Activities", which states: Conclusive evidence of a full-scale marijuana grow operation could support the giving of a notice on this ground [section 36(1)(f)], due both to the high likelihood of serious damage to the premises and the risk of harm to other tenants. If a tenant's illegal activity is causing no damage to the landlord or other tenants, and is not likely to cause any risk or damage, the landlord may not be successful in ending the tenancy on this ground. [20] Commenting that the risks associated with marijuana cultivation will vary from case to case, the arbitrator said: The photographs and other evidence before me persuade me that more than a few plants were growing in both House #160 and #161. The photographs show a substantial number of plants of varying degrees of maturity and there is evidence that extra lighting has been installed. I have therefore concluded that this is a situation that involves some risk to the premises. Furthermore, when a tenant is engaging in an illegal tenancy that involves risk, the landlord should not be required to wait until damage actually happens before being able to terminate the tenancy. She concluded that the landlord had established grounds to end Ralph Fulber's tenancy of house #160 and Ronald Fulber's tenancy of house #161. [21] With respect to house #159, the arbitrator was not satisfied that the tenant Ralph Fulber had sublet the premises without consent. There was no application for judicial review of her decision in that respect. [22] However, she upheld the termination of the tenancy on the basis of s. 40(1) of the Act. She stated that the tenant had, by engaging in an activity that put his other rental premises at risk, shown a disregard for the landlord's interests and that it was not appropriate to force the landlord to continue to rent to him, even though house #159 had not been put at risk. [23] The hearing before the arbitrator was on July 17, 2000 and December 1, 2000. The arbitrator's decision is dated February 23, 2001. She made orders for possession effective March 31, 2001. The judicial review application came before me on March 30, 2001 and I ordered that the orders for possession be stayed pending my decision. Grounds for Judicial Review [24] The tenants rely upon the following grounds for judicial review: 1. The landlord refused to provide particulars as to the interest which it claimed the tenants had seriously impaired and the arbitrator declined to order the landlord to provide such particulars; 2. The arbitrator made essential findings of fact on the basis of hearsay evidence; 3. Counsel for the landlord provided written submissions, further evidence and case briefs between the two hearing dates without sending copies to counsel for the tenants, and the arbitrator refused to grant an adjournment to permit counsel for the tenants to review the material; 4. The arbitrator's decision was unreasonable or patently unreasonable in that: (a) despite her finding of fact that there was no evidence of structural change, changes to the wiring, or other fire or safety hazard, and that there was not an issue of safety with respect to the landlord or other occupants of the property, the arbitrator concluded that the tenants' activities in growing marijuana involved some risk to the premises; and (b) she applied a test other than the test required by statute, which permits the landlord to terminate the tenancy only where the safety of the landlord is seriously impaired. Analysis [25] The first three grounds for judicial review are alleged denials of procedural fairness and natural justice. The fourth ground relates to alleged substantive errors. A. Denial of Procedural Fairness [26] The tenants' position is that the arbitrator breached the duty of fairness. Mr. Woodall for the tenants argued that, taking into account the factors identified in Baker v. Canada (Minister of Citizenship and Immigration), [1999] 2 S.C.R. 817, a high level of procedural fairness is required. In Baker, L'Heureux-Dubé J. said (at pp. 837 - 841) that the following principles are relevant to the determination of the content of the duty of procedural fairness in a given case: (1) the nature of the decision being made and the process followed in making it, in particular the closeness of the process to a judicial process; (2) the nature of the statutory scheme and the role of the particular decision within that scheme, in particular whether there is an internal appeal procedure; (3) the importance of the decision to the persons affected, which is identified as a particularly significant factor; (4) the legitimate expectations of the person challenging the decision as to the procedures which will be followed; and (5) whether the statute leaves the decision-maker the ability to choose its own procedures and whether the agency has expertise in determining what procedures are appropriate in the circumstances. [27] Counsel for the tenants pointed to the similarity between the arbitration process and the judicial process, the fact that there is no internal appeal, and the importance to these tenants of continuing their tenancies since they have been part of the community at Britannia Beach for 17 years (Ralph Fulber) and 13 years (Ron and Filomena Fulber). [28] Counsel for the respondent, Ms. McNaught, did not disagree that a high level of procedural fairness is required. [29] Mr. Loenen, counsel for the Attorney General of British Columbia and the Director of the Residential Tenancy Office, made no submissions as to the level of procedural fairness required but directed my attention to Mack v. Yu (1991), 7 Admin. L. R. (2d) 67 at 77, where Errico J. stated: I find that the legislation has set up a scheme for the speedy and inexpensive determination of disputes between landlords and tenants with the intention that the award be final and binding. [30] Considering each of the factors specified in Baker, I first note that arbitrators under the Act have the power to determine their own procedure (s. 55) and that they may have expertise in making that determination. This factor points to non-intervention. However, the other factors highlighted in Baker point to the necessity for a high standard of procedural fairness. The arbitration proceedings are similar to judicial ones and indeed disputes between landlord and tenant would be in court but for the existence of this legislative arbitration scheme; there is effectively no internal appeal (the review process provided by s. 59 of the Act applies only on a very limited basis such as when new evidence has come to light that was not available before the hearing); and the outcome is highly important to the individuals affected. The petitioners in this case have lived in the community for many years, and the termination of their tenancies will mean dislocation for them and their families. I conclude that a high standard of procedural fairness is required. [31] I turn now to the first three grounds for judicial review. 1. The landlord refused to provide particulars as to the interest which it claimed the tenants Ron and Filomena Fulber had seriously impaired and the arbitrator declined to order the landlord to provide such particulars. [32] The Residential Tenancy Office Information Bulletin, "Measures to Protect Against Illegal Activities", states: [I]f notice is being given for a serious impairment of the landlord's lawful right or interest, the landlord must be specific about how that lawful right or interest is being impaired. [33] The Notice to End a Residential Tenancy with respect to house #160 and house #159 had particulars attached, but that relating to house # 161 did not. The body of the notice stated: Section 36(f). House #161 was subject to warrant to search by RCMP on June 14/2000. Tenant was subsequently charged with production of a controlled substance (marihuana). Tenant had a grow-op on premises. [34] Ronald Fulber takes the position that the refusal of the landlord to state what lawful interest was being impaired, and the refusal of the arbitrator to require the landlord to do so, amounted to an infringement of the duty of fairness and of the Residential Tenancy Branch's guidelines. [35] The landlord's position is that this tenant had notice of the facts upon which the landlord proposed to rely since his counsel had received a copy of the affidavit of Maurice Neill in which those facts were set out. The affidavit, sworn July 14, 2000, states with respect to house #161 that: the RCMP obtained a search warrant (copies of the Information to Obtain a Search Warrant and the Warrant itself are attached); Mr. Neill attended with the police on June 14 and saw what he believed to be a marijuana grow operation upstairs and observed that electrical alterations had been made to the premises (photographs are attached); the RCMP sent a letter on June 20, 2000, confirming charges (a copy is attached); and Mr. Neill personally served Ron Fulber with the Notice to End a Residential Tenancy. In the Information to Obtain a Search Warrant, Constable Darren Stevely of the R.C.M.P. deposed that on June 13, 2000, from the street west of house #161, he detected an overwhelming odour of growing marijuana. He deposed that he was certain that it emanated from house #161. [36] Mr. Woodall referred to Hampton v. Bahnman, [2000] S.J. No. 570 (Q.B.) and urged that the fair hearing requirement can only be met if the persons affected by the tribunal's decision have notice of what is being alleged against them with sufficient particulars to entitle them to prepare their case. I accept that that is the requirement, but conclude that the tenant Ronald Fulber had notice that the landlord would be alleging that its lawful right or interest was being impaired by the presence of marijuana growth and electrical alterations on the premises. I therefore conclude that there was no denial of procedural fairness in the arbitrator declining to order further particulars. 2. The arbitrator made essential findings of fact relating to house #160 on the basis of hearsay evidence. [37] Mr. Neill testified that he saw the upside-down electrical meter at house #160. The disputed hearsay evidence addressed the significance of upside-down electrical meters. In the Information to Obtain a Search Warrant sworn by Constable Scott Wayne Stoughton it is stated: That, on May 31, 2000 at 09:51 hours Constable Darren STEVELY, a member of the Royal Canadian Mounted Police attached to the Squamish Detachment, hereinafter referred to as Cst. STEVELY spoke to Jim SCHEMICK, Supervisor of B.C. Hydro Diversion Investigations, hereinafter referred to as SCHEMICK. SCHEMICK stated, "A meter in a base turned upside down, will cause the meter to run backwards, taking off kilowatt hours, which is one way of stealing electricity. There is no other reason for a meter to be upside down. That it is not uncommon to find meter's (sic) turned upside down at marihuana grows, as marihuana grows use a huge amount of electricity, which is significantly larger than at an average house. It is common to find a meter to be turned upside down for 3/4 of the time and right side up for 1/4 of the time". [38] Constable Stoughton also swore that he compared electrical consumption records for the house with those for a house of similar construction, size and number of occupants and determined that the electrical consumption was 47% higher at house #160 than at the comparable house. [39] None of these witnesses (Constable Stevely, Constable Stoughton or Mr. Schemick) testified at the hearing. Mr. Neill, to whose affidavit the Information to Obtain a Search Warrant was attached, did testify and was cross-examined. Thus, the crucial evidence regarding the significance of an upside-down electrical meter was, at best, third-hand hearsay. [40] The arbitrator admitted the evidence over the objection of counsel for the tenants, commenting that hearsay evidence may be given less weight. She took it into account in reaching her conclusion that there was a serious impairment of the landlord's interest in that excess electricity was being used at house #160, with an attempt to disguise that fact through the manipulation of the meter. [41] The tenants' position is that, while the arbitrator had discretion to admit hearsay evidence, she was wrong to decide an essential issue solely on the basis of such evidence. [42] Mr. Woodall argued that the reliability of the evidence is belied by the fact that although the warrant was obtained on the basis that there were reasonable and probable grounds to conclude that theft of electricity was occurring, no charges of theft of electricity have been laid. In other words, he argued, if the police had confidence in Mr. Schemick's opinion they would have charged Ralph Fulber with theft of electricity. [43] Section 55(1) of the Act provides: (1) In a matter before an arbitrator, the arbitrator (a) may conduct the hearing in the manner he or she considers necessary, subject to rules of procedure, if any, established by the director under section 50, (b) must make his or her decision on the merits of the matter and is not bound by legal precedent, (c) may receive and accept, on oath, affidavit or otherwise, the evidence or information he or she considers necessary and appropriate whether or not the evidence or information would be admissible in a court, (d) must give the decision in writing and with reasons, .... [44] The tenants' position is that the existence of a statutory power expressly allowing the arbitrator to admit hearsay evidence does not abrogate the need to follow fair hearing principles with respect to the use of the evidence. Mr. Woodall referred me to three cases as authority that when a tribunal relies exclusively on hearsay evidence this may deprive a party of a fair hearing. [45] In Re Girvin and Consumers' Gas Co. (1973), 1 O.R. (2d) 421 (Ont. H.C.J. Div. Ct.) an arbitration award in a dismissal case was quashed because the board made a finding of fact relying on hearsay evidence, some of which was in conflict, in preference to the evidence of the grievor. Holland J. wrote at p. 424: Such evidence may well be admissible by reason of the subsection of the Labour Relations Act above referred to, but it must be borne in mind that in cases of this type the burden is on the employer to show that the employer acted properly in the discharge of the employee and in order to satisfy that burden in this case the employer, in effect, relied exclusively on hearsay evidence. Even though that evidence may well have been admissible we are all of the view that the employee did not receive a fair hearing in the circumstances. His counsel had no real opportunity to cross-examine on the evidence that was presented. [46] In Michayluk v. Menke Holdings Ltd., [1998] S.J. No. 428 (Q.B.), Laing J. stated: ... I do wish to note that with respect to hearsay evidence, there is seldom a rational basis for its acceptance over a first person denial of the facts alleged. In informal hearings, hearsay evidence is often expedient for matters which are not controversial. However, if the hearsay evidence is being put forward as proof of a fact(s) which is controversial and denied by first party evidence, it would seem as a minimum that before a hearing officer accepts the hearsay evidence, some opportunity be provided to the party affected to rebut that evidence by third party evidence including the source of the hearsay. [47] In B.(J.) v. Catholic Children's Aid Society of Metropolitan Toronto (1987), 27 Admin. L.R. 295 (Ont. S.C. Div. Ct.) the issue was whether the applicant could have his name removed from the "child abuse register". At the hearing the only witness was a social worker, who repeated what the alleged victim, who was twelve years old, had said originally. It appeared that the girl herself was not called because she now denied that abuse had occurred. The court held that in those circumstances, where the applicant was denied the right to cross-examine the alleged victim, the admission of the hearsay evidence amounted to a denial of natural justice and the hearing fell below the minimum requirement of fairness. [48] Counsel for the landlord argued that those cases are all distinguishable, and I agree. In the first two cases, hearsay evidence was accepted in preference to direct denials. In the third case, there was a patent and very serious reason for doubting the reliability of the evidence in that the person who made the original statements now denied that they were true. [49] None of those circumstances exists in the case before me. There was no evidence contradicting the hearsay evidence. Although the tenants formally denied the theft of electricity, they did not testify. Mr. Woodall suggested that I should take into account that the tenants face criminal charges and were in a difficult position with respect to the arbitration hearing such that it is understandable that they did not give evidence. He emphasized that the burden of proof is on the landlord, to a civil standard of balance of probabilities. [50] I am not persuaded that the arbitrator denied procedural fairness to the tenants in receiving the hearsay evidence and placing some weight on it. There was direct evidence about the upside-down electrical meter and the high consumption of electricity at the house. Aside from the fact that no charges of theft of electricity were laid, there is nothing to cast doubt on the reliability of the hearsay evidence in the Information (from Mr. Schemick) about the significance of an upside-down electrical meter. Mr. Woodall suggests that I draw an inference from the absence of charges, and I do take that into account. However, there may be many reasons for which charges are not laid and drawing a strong adverse inference about the reliability of the evidence in the Information would not be reasonable. [51] I have concluded that the arbitrator did not create procedural unfairness by receiving, and giving some weight to, the hearsay evidence in this case. There was no evidence to the contrary, the arbitrator considered its weight, and she had the authority under the statute to exercise discretion as she did. 3. Counsel for the landlord provided written submissions, further evidence and case briefs between the two hearing dates without sending copies to counsel for the tenants, and the arbitrator refused to grant an adjournment to permit counsel for the tenants to review the material. [52] In the period between the two hearing dates, the arbitrator directed that copies of each counsel's argument and authorities be delivered to her in advance of the resumed hearing. Counsel for the landlord delivered the argument and authorities to the arbitrator as directed but did not send copies to counsel for the tenants. Instead, she gave them to him at the hearing. Similarly, at the hearing, counsel for the tenants provided copies of his argument and authorities to counsel for the landlord. The arbitrator adjourned the hearing briefly to review the tenants' argument and authorities and to give each counsel the opportunity to review the others' submissions. [53] Mr. Woodall pointed to Rule 8.3 of the Rules for Arbitration, which prohibits communicating with the arbitrator before or after a hearing unless the other party is advised. He further complained that the arbitrator's refusal to provide an adjournment deprived the petitioners of the right to make submissions about the admissibility of a newspaper article and letter to the editor that the landlord's counsel had provided to the arbitrator. Ms. McNaught for the landlord submitted that there was no prejudice to the tenants, since each side had the opportunity for the first time to review the submissions from the other side at the outset of the resumed hearing. [54] I am not persuaded that in these circumstances the arbitrator's failure to grant an adjournment constitutes procedural unfairness. The newspaper article and letter to the editor were not of central significance. Certainly the normal professional courtesy is to send copies of materials provided to an adjudicator at the same time to counsel for the opposing party, but in the absence of material prejudice to the landlord, I do not think the arbitrator denied a fair hearing by refusing the longer adjournment sought. Again, she acted within the discretion provided to her under the Act regarding the proceedings before her. B. Substantive Errors [55] In determining the standard of review on substantive issues, the Supreme Court of Canada requires courts to take a "pragmatic and functional approach": Pezim v. B.C. (Superintendant of Brokers), [1994] 2 S.C.R. 557; Canada (Director of Investigation & Research) v. Southam Inc., [1997] 1 S.C.R. 748; Pushpanathan v. Canada (Minister of Citizenship & Immigration), [1998] 1 S.C.R. 982; and Trinity Western University v. British Columbia College of Teachers, [2001] S.C.J. No. 32, 2001 SCC 31. Standards of review appear on a spectrum ranging from least deferential (correctness) to more deferential (reasonableness simpliciter, which I will call "simple reasonableness") to most deferential (patent unreasonableness). To determine the appropriate standard of review, the court is to take into account a number of factors: (1) the existence of a privative clause or statutory right of appeal; (2) the expertise of the tribunal, in particular in relation to the expertise of the court; (3) the purpose of the statute and of the particular provision; and (4) the nature of the problem, be it a question of law, fact, or mixed law and fact: Pushpanathan; Baker. [56] In Trinity Western University v. British Columbia College of Teachers, the court's majority (per Iacobucci and Bastarache JJ.) stated at para. 17: In Pushpanathan v. Canada (Minister of Citizenship and Immigration), [1998] 1 S.C.R. 982, Bastarache J. summarized the recent jurisprudence of the Court on the standards of review to provide a framework for easy reference by judges and lawyers. Bastarache J. insisted on the fact that, under the pragmatic and functional approach, the focus of the inquiry is still on the particular provision being interpreted by the tribunal and that some provisions will require more deference than others, although they are found in the same Act. The court confirmed that Pushpanathan did not modify Pezim or Canada (Director of Investigation & Research) v. Southam and observed that where the tribunal plays an important policy development role, as in Pezim, a higher degree of deference is warranted. [57] Mr. Woodall for the tenants argued that the standard of review should be at the middle level of deference, that is, the standard of simple reasonableness. In arguing for that standard, he emphasized the absence of a privative clause in the legislation, the absence of specialized skill by the arbitrator on safety issues posed by marijuana growing, and the wording of s. 36(1)(f), which is highly specific and leaves little discretion for arbitrators-certainly not the kind of policy-formation role present in those cases where the highest level of deference is accorded to administrative decision-makers. [58] In the alternative, Mr. Woodall argued that if the standard is patent unreasonableness, the arbitrator's decision also failed to meet that standard. [59] Ms. McNaught for the landlord argued that the standard of review is patent unreasonableness, emphasizing that there could be no question that the arbitrator was within her jurisdiction in making the decision. She cited Caesar & Elliott Group v. Sherwood, [2000] B.C.J. No. 1445 (S.C.), where Hunter J. stated at paras. 11-12: If an arbitrator's decision pertains to whether or not he has jurisdiction under the Act then the standard of review is correctness, that is, the arbitrator's interpretation of the scope of his power has to be correct. On the other hand, if an arbitrator is applying a provision within the scope of his jurisdiction then the standard of review is whether that decision was patently unreasonable. ... In the case at bar, the arbitrator has been given the power under s. 12 ... to make a decision or order that "is final and binding on the parties". This clause exemplifies the Legislature's intent that the court should not interfere with an arbitrator's decision except where it is patently unreasonable. [60] Mr. Loenen submitted that the courts of this province have consistently found that arbitrators under the Act are entitled to curial deference with respect to intra-jurisdictional errors of law and that the appropriate standard of review in this case is whether the decision of the arbitrator was patently unreasonable or clearly irrational. [61] Mr. Loenen submitted that the scope of review where the alleged error relates to findings of fact drawn from the evidence is very limited, citing Canada (A.G.) v. P.S.A.C. No. 2 (1993), 101 D.L.R. (4th) 673 at 691 (S.C.C.), Toronto (City) Board of Education v. O.S.S.T.F., District 15, [1997] 1 S.C.R. 487 at paras 44-48, and Re McInnes and Simon Fraser University (1982), 140 D.L.R. (3d) 694 (B.C.S.C.); aff'd (1984), 3 D.L.R. (4th) 708 (B.C.C.A.). In the latter decision McLachlin J. wrote at pp. 698 and 701: If the decision is to be upheld, there must be some evidence logically capable of supporting the conclusion to which the tribunal has come. Such evidence is sometimes referred to as evidence which "reasonably" supports the conclusion, leading to statements such as that found in Re Stalybridge, supra, to the effect that the conclusion must be one to which the tribunal could reasonably have come on the evidence. Such language does not, in my view, authorize the court to embark on the exercise of weighing and evaluating evidence which was properly received by the committee and which possesses some probative value. The court of review remains confined to the initial question of whether there is some evidence capable of supporting the committee's conclusion. ... The tribunal may reject portions of evidence and accept others; and it may determine what weight to place on those portions of the evidence which it accepts. Provided that the tribunal's conclusion is one to which it could reasonably have come on that evidence, this court has no power to interfere. [62] British Columbia courts have generally held that arbitrators under the Act are entitled to curial deference with respect to intra-jurisdictional questions of law and that, unless the alleged error of law concerns a jurisdiction-limiting provision, courts should only interfere where the decision is patently unreasonable: see Mack v. Yu; Caesar & Elliott; Quintette Operating Corp. v. Sundquist, [1994] B.C.J. No. 781 (S.C.); Lessard v. Watson, [1999] B.C.J. No. 1433 (C.A.); Cameron v. Sparks, [1997] B.C.J. No. 1570 (S.C.); Fraser v. Vancouver Board of Parks & Recreation, [2001] B.C.J. No. 539, 2001 BCCA 214 (C.A.); and Al Stober Construction Ltd. v. Long, [2001] B.C.J. No. 1086, 2001 BCSC 762 (S.C.). In Fraser, the Court of Appeal (per Saunders J.A.) held that the "patent unreasonableness" standard should be applied to an arbitrator's decision characterizing the relationship between a resident caretaker and the Parks Board as one of "employment" covered by s. 34(1) of the Act. [63] Applying the four factors the Supreme Court has identified in Baker and Pushpanathan, I note the following. First, there is a "finality" clause, though not a "full" privative clause. Section 57(3) of the Act states that "Except as otherwise provided in this Act, a decision or order of an arbitrator is final and binding on the parties". Second, given the arbitrators' task under the legislation to determine large numbers of disputes between landlords and tenants, it seems likely that arbitrators have expertise in determining when a landlord's safety or other lawful right or interest has been seriously impaired by an act or omission of the tenant. Third, the purpose of the arbitration scheme in the Act must be to provide for dispute resolution between landlords and tenants inexpensively and expeditiously. Consistent with this would be a deferential approach when the arbitrators are determining questions of law or mixed fact and law within their jurisdiction. The question here, that is, whether the "safety or other lawful right or interest of the landlord" has been "seriously impaired by an act or omission of the tenant", is a question of mixed fact and law. Fourth, the decision affects the interests of the particular tenants and landlord, and is not complex, polycentric, or policy-intensive. This latter factor points toward less rather than more deference. However, considering the legislative scheme and nature of the decision at issue here, as well as the previously-decided cases on the standard of review under the Act, I conclude that the standard of review should be patent unreasonableness. [64] I now turn to the final ground for judicial review. 4. The arbitrator's decision was unreasonable or patently unreasonable in that: (a) despite her finding of fact that there was no evidence of structural change, changes to the wiring, or other fire or safety hazard, and that there was not an issue of safety with respect to the landlord or other occupants of the property, the arbitrator concluded that the tenants' activities in growing marijuana involved some risk to the premises; and (b) she applied a test other than the test required by statute, which permits the landlord to terminate the tenancy only where the safety of the landlord is seriously impaired. [65] Was the arbitrator's decision patently unreasonable on those grounds? [66] Section 36(1)(f) allows a landlord to give notice if "the safety or other lawful right or interest of the landlord or other occupant in the residential property has been seriously impaired by an act or omission of the tenant or of a person permitted in or on the residential property or residential premises by the tenant". [67] The arbitrator concluded that growing marijuana is not per se a serious impairment of a landlord's right or interest within the meaning of s. 36(1)(f) and that decisions must be made on a case by case basis, depending on the scale of operations and all of the circumstances. She stated: The risks associated with marijuana cultivation can vary from case to case. For example the risks to the premises are much higher in a very large-scale operation that involves changes to the wiring and plumbing and a hydro bypass. The seriousness of a grow operation is also reflected in the criminal penalties imposed on conviction. On the other hand, if a tenant is growing a few marijuana plants in natural light there may be no risk or very minimal risk to the premises. [68] I agree with her reasoning and conclusion, and as well find persuasive the comments she referred to by the Law Reform Commission in its Report of 1973. The Commission, in explaining its recommendation regarding a ground similar to s. 36(1)(f), stated at p. 68: [This] [c]ircumstance is a "catch-all" provision designed to cope with other types of tenant misbehaviour not specifically enumerated. For example, in such schemes it is not uncommon to specify that termination is justified where the tenant is utilizing the premises for illegal activity. In our view, such a provision is too wide and may encompass behaviour totally unrelated to the tenancy. The criminal law provides penalties for unlawful conduct and there is little to be said for adding the potential penalty of dispossession, particularly when the original offence may be one punishable by a small fine. [69] The arbitrator also concluded that it is not necessary for a landlord to prove damage to the premises. I think she was correct: s. 36(1)(f) does not refer to actual damage to the premises, and there are other subsections specifically directed to that issue. [70] The petitioner's ground 4(a) (set out above) raises a question of conclusions to be drawn from the evidence. As highlighted by McLachlin J. in Re McInnes and Simon Fraser University, provided the arbitrator's conclusions are ones to which she "could reasonably have come on that evidence", this court has no power to interfere with those conclusions. [71] In reaching her conclusion here, did the arbitrator act irrationally or with patent unreasonableness? Mr. Woodall for the tenants argued that she did. He characterized her reasons as "shifting abruptly" from a conclusion that there was no damage to the premises, structural changes, additional wiring, or risk to the landlord or occupant, to the statement that she found "some risk". [72] Counsel for the landlord disagreed. Ms. McNaught submitted that the arbitrator held that the evidence before her showed that there was some risk, that is, some safety issue -- though not to the landlord or to other tenants' personal safety. Ms. McNaught pointed to these statements by the arbitrator: I am persuaded on a balance of probabilities that electrical alterations have been made to House #160 and #161 in the form of additional lights and sockets. I am not persuaded that changes have been made to the structure of either House or that either House has otherwise been damaged. ... House #160 and #161 are freestanding buildings and are occupied only by the Tenants and Ronald's wife. Therefore, I have concluded that there is not an issue of safety of the Landlord or other occupants of the property. ... The photographs show a substantial number of plants of varying degrees of maturity and there is evidence that extra lighting has been installed. I have therefore concluded that this is a situation that involves some risk to the premises. Furthermore, when a tenant is engaging in an illegal activity that involves risk, the landlord should not be required to wait until damage actually happens before being able to terminate the tenancy. [73] I agree with Ms. McNaught that the arbitrator was distinguishing between risk to person and to the premises, and that the arbitrator found there was some risk to the premises flowing from the presence of marijuana cultivation and, in particular, the extra lighting. There was evidence before her upon which she could reasonably have come to that conclusion. Therefore there is no basis upon which to interfere. [74] I turn to the final issue (set out as ground 4(b) above): did the arbitrator apply the wrong test? Mr. Woodall argued that she did, in that she upheld the notices on the basis of "some risk" to the premises rather than "serious impairment" of the landlord's interests. He pointed to the evidence that this was far from a large operation. He argued that because the tenants had lived in the premises for many years and had maintained them well, and because they wished and intended to stay in the community, it was unlikely that they would harm the premises. He emphasized the arbitrator's findings that there was no structural alteration or damage to the property. Mr. Woodall asked rhetorically if putting up a string of extra Christmas lights would provoke the same response. [75] I think that the arbitrator, although she referred to the statutory test, did not in the end apply it in the case of house #161. [76] The arbitrator found that there were electrical alterations to the house in that there were additional lights and sockets in the upstairs closet where the plants were found. There was no evidence of additional wiring. There was no evidence of structural alteration or damage to the property. [77] The arbitrator did not specify the nature or magnitude of the risk that she found when she stated there was "some risk" to the premises, and she did not state that the risk that she perceived constituted a serious impairment of the landlord's interests. It is not simply that the arbitrator used language different from that of s. 36(1)(f). The nub of the concern is that it is neither explicit in her conclusion nor implicit in her analysis that the tenant's activities in house #161 resulted in a serious impairment of the landlord's interest. [78] For those reasons, I find that the arbitrator's decision upholding the notice regarding house #161 was patently unreasonable. [79] With respect to house #160, there was similar evidence about marijuana plants and lights. In addition there was evidence of significant higher use of electricity and the upside-down meter. The arbitrator found with respect to house #160 that as a result there was a serious impairment of the landlord's interest because it was an act that was related to the premises that had negatively affected the landlord's economic interest in the premises. I am not persuaded that her decision was patently unreasonable; there was evidence upon which she based it, and she applied the correct test. [80] Finally, with respect to house #159, the arbitrator's decision flowed from her decision with respect to Ralph Fulber's conduct in connection with house #160. She held that because Ralph Fulber had seriously impaired the landlord's interest with respect to house #160, the landlord had cause pursuant to s. 40(1) of the Act to end Ralph Fulber's tenancy of house #159 as well. The arbitrator referred to the landlord's willingness to enter into a tenancy agreement with the sub-tenant, Mr. Quirk. I do not find that the arbitrator's decision was patently unreasonable. [81] Accordingly, the petition of Ronald and Filomena Fulber for judicial review succeeds; the petition of Ralph Fulber for judicial review is dismissed. [82] As is apparent from these reasons, tenants are not at liberty to grow marijuana in their rented premises without fear of consequences from their landlords. As the arbitrator stated in this case, when a tenant is carrying on an illegal activity that involves risk, the landlord should not have to wait for actual damage to occur before terminating the tenancy. Marijuana grow operations are illegal activities, many of which will carry risk. Risks may flow from wiring changes, excess moisture, and other physical factors which affect the premises. Risks may also flow from the very existence of an illegal activity in certain circumstances, if it is substantial and may be associated with violence, or even with vigorous police enforcement. All will depend on the facts in each case. However, illegal activities do not automatically constitute a basis for termination under s. 36(1)(f) of the Residential Tenancy Act, nor does "some risk" of any magnitude from trivial to extreme. The legislation requires a "serious impairment" of the landlord's interest. In one of the cases before the arbitrator (house #160), she applied that test properly and found that the landlord's interest was seriously impaired. In the other (house #161) I have found that she did not apply that test and it is for that reason that the order is quashed. [83] The order of the arbitrator with respect to house #161 is quashed and the matter is remitted to a different arbitrator under the Act for re-hearing in accordance with these reasons. The orders for possession with respect to houses #159 and #160 are stayed until July 21, 2001. "Lynn Smith, J." The Honourable Madam Justice Lynn Smith