Ruffolo v. Jackson

Ruffolo v. Jackson Collection Decisions of the Court of Appeal Date 2010-07-05 Neutral citation 2010 ONCA 472 Docket numbers C51634 Judges Rosenberg, Marc; Feldman, Kathryn N.; Watt, David Subject Civil Decision Content CITATION: Ruffolo v. Jackson, 2010 ONCA 472 DATE: 20100705 DOCKET: C51634 COURT OF APPEAL FOR ONTARIO Rosenberg, Feldman and Watt JJ.A. BETWEEN: Mary Ruffolo and Luigino Ruffolo Appellants and Linda Jackson Respondent Eric Gillespie and Julia Croome, for the appellants Morris Manning Q.C., for the respondent Heard: May 7, 2010 On appeal from the order of Justice John R. R. Jennings of the Superior Court of Justice, on motion in the Divisional Court, dated October 2, 2009, with reasons reported at 2009 CanLII 55363 (ON S.C.D.C.), quashing an appeal from the order of Justice Jane E. Kelly of the Superior Court of Justice, dated April 14, 2009, with reasons reported at 2009 CanLII 16582 (ON S.C.). Feldman J.A: Overview [1] The issue in this case is whether there is a right of appeal by an elector to the Divisional Court under the Municipal Conflict of Interest Act, R.S.O. 1990, c. M.50 (MCIA), where the Superior Court declines to make an order under s. 10 finding that a member of a municipal council was in a conflict of interest. In my view, the Divisional Court correctly held that there is no right of appeal in those circumstances. Facts [2] In 2006, the appellants settled a wrongful dismissal action with the City of Vaughan. In 2007 and 2008, Mr. Ruffolo and another elector were involved in proceedings to force a compliance audit respecting the respondent’s campaign finances in her mayoral campaign. In November 2007, Vaughan City Council voted to commence litigation against the appellants for breach of the settlement agreement. The respondent’s involvement in that decision consisted of the following: The respondent received an agenda for a meeting of a closed session of the Committee of the Whole including consideration of the proposed lawsuit. The respondent sought legal advice regarding any potential conflict. The respondent attended the Committee of the Whole where the issue was discussed. She also attended the subsequent Council meeting where the vote was taken, but she did not participate in the vote. [3] Based on these actions, the appellants brought an application under s. 9 of the MCIA for a s. 10 order removing the respondent from the office of Mayor of Vaughan for alleged violations of ss. 5(1) and (2) of the Act. Kelly J. dismissed the application, finding that the respondent had no personal pecuniary interest in the City’s action against the appellants and no other conflict of interest. In any event, the respondent sought legal advice and did not participate in the vote; any possible conflict in her actions would have been saved by the s. 10(2) defence of inadvertence. [4] The appellants sought to appeal to the Divisional Court. On a motion to quash the appeal, Jennings J. held that the only appeal provided in the Act is by a member where a conflict of interest is found. There is no right of appeal by an elector from a decision that the member was not in a conflict of interest. Issue [5] Is there a right of appeal by an elector from a finding that a member did not breach ss. 5(1), (2) or (3) of the MCIA, either under s. 11 of that Act or under s. 6(1) of the Courts of Justice Act? Analysis [6] The legislative framework for consideration of the first part of this issue is found in the following sections of the MCIA: Duty of Member When present at meeting at which matter considered 5. (1) Where a member, either on his or her own behalf or while acting for, by, with or through another, has any pecuniary interest, direct or indirect, in any matter and is present at a meeting of the council or local board at which the matter is the subject of consideration, the member, (a) shall, prior to any consideration of the matter at the meeting, disclose the interest and the general nature thereof; (b) shall not take part in the discussion of, or vote on any question in respect of the matter; and (c) shall not attempt in any way whether before, during or after the meeting to influence the voting on any such question. Where member to leave closed meeting (2) Where the meeting referred to in subsection (1) is not open to the public, in addition to complying with the requirements of that subsection, the member shall forthwith leave the meeting or the part of the meeting during which the matter is under consideration. When absent from meeting at which matter considered (3) Where the interest of a member has not been disclosed as required by subsection (1) by reason of the member’s absence from the meeting referred to therein, the member shall disclose the interest and otherwise comply with subsection (1) at the first meeting of the council or local board, as the case may be, attended by the member after the meeting referred to in subsection (1). … Action where Contravention Alleged Who may try alleged contravention of s. 5 (1-3) 8. The question of whether or not a member has contravened subsection 5 (1), (2) or (3) may be tried and determined by a judge. Who may apply to judge 9. (1) Subject to subsection (3), an elector may, within six weeks after the fact comes to his or her knowledge that a member may have contravened subsection 5 (1), (2) or (3), apply to the judge for a determination of the question of whether the member has contravened subsection 5 (1), (2) or (3). Contents of notice of application (2) The elector in his or her notice of application shall state the grounds for finding a contravention by the member of subsection 5 (1), (2) or (3).… Power of judge to declare seat vacant, disqualify member and require restitution 10. (1) Subject to subsection (2), where the judge determines that a member or a former member while he or she was a member has contravened subsection 5 (1), (2) or (3), the judge, (a) shall, in the case of a member, declare the seat of the member vacant; and (b) may disqualify the member or former member from being a member during a period thereafter of not more than seven years; and (c) may, where the contravention has resulted in personal financial gain, require the member or former member to make restitution to the party suffering the loss, or, where such party is not readily ascertainable, to the municipality or local board of which he or she is a member or former member. Saving by reason of inadvertence or error (2) Where the judge determines that a member or a former member while he or she was a member has contravened subsection 5 (1), (2) or (3), if the judge finds that the contravention was committed through inadvertence or by reason of an error in judgment, the member is not subject to having his or her seat declared vacant and the member or former member is not subject to being disqualified as a member, as provided by subsection (1). … Appeal to Divisional Court 11. (1) An appeal lies from any order made under section 10 to the Divisional Court in accordance with the rules of court. Judgment or new trial (2) The Divisional Court may give any judgment that ought to have been pronounced, in which case its decision is final, or the Divisional Court may grant a new trial for the purpose of taking evidence or additional evidence and may remit the case to the trial judge or another judge and, subject to any directions of the Divisional Court, the case shall be proceeded with as if there had been no appeal. Appeal from order or new trial (3) Where the case is remitted to a judge under subsection (2), an appeal lies from the order of the judge to the Divisional Court in accordance with the provisions of this section. [7] The issue of the Divisional Court’s jurisdiction to hear an appeal by an elector from a refusal to make an order under s. 10 was determined by that court in 1991 in Van Schyndel v. Harrell (1991), 6 O.R. (3d) 335 (leave to appeal to the C.A. refused January 20, 1992). In that case, the majority held that the MCIA is intended to be a complete code dealing with municipal conflicts of interest and that the procedures, including any appeal rights, are to be found in its provisions. Section 11 of the Act only allows an appeal from an order made under s. 10. Section 10 gives the court the power to impose certain penalties where it finds that a member or former member has acted in a conflict of interest. Where the court finds no conflict of interest under s. 5, no order is made under s. 10. [8] The majority explained that this result reflects the intent of the legislature to provide a procedure to deal with allegations of conflict of interest for elected municipal representatives, but not to allow such allegations to be prolonged by appeal through the three-year term of a member where the court finds no conflict of interest. [9] As part of its analysis, the majority referred to the fact that the statute is awkwardly worded and in that context, because it is penal in nature, it should be narrowly interpreted in favour of the member in case of ambiguity. This aspect of the reasoning, however, was superseded a couple of years later by a new approach adopted by the Supreme Court of Canada in R. v. Hasselwander, [1993] 2 S.C.R. 398, where Cory J. stated, at p. 413 (para. 30): “even with penal statutes, the real intention of the legislature must be sought, and the meaning compatible with its goals applied.” The balance of the analysis of the majority that I have described does address the intention of the legislature in the context of the words used in the Act. [10] The dissenting judge equated the appeal found in s. 11 of MCIA with appeal provisions in other acts such as the Business Corporations Act, 1982, S.O. 1982 c. 4, as amended, s. 254, and the Landlord and Tenant Act, R.S.O. 1980, c. 232, as amended, s. 116(1), where the wording of the appeal provisions read: “an appeal lies from any order made under this Act”. He concluded that if the majority decision was correct, then no appeal would lie from the refusal to make an order under those acts. However, the difference in the wording of the appeal provisions explains the difference in the scope of appeal rights. In s. 11 of the MCIA, the only appeal is from an order made under s. 10, which is an order for a penalty following a finding of conflict of interest. Under the appeal provisions of the other acts referred to, the appeal is from any order made under the Act. That would include an order not to grant the relief requested, because the request is made “under the Act”. [11] The dissenting judge also raised a further concern with the majority interpretation—that there could be a finding of a conflict of interest under s. 8 of the Act, but no appeal from such a finding. [12] In my view the Act does not operate in that way. Although s. 8 grants the court the jurisdiction to both try and determine the “question of whether or not a member has contravened ss. 5(1), (2), or (3)”, it is under s. 10 that the court makes the positive determination of a contravention, then applies the defence of inadvertence if applicable, and where the defence does not apply, imposes the penalty. The appeal then lies under s. 11 from the order made under s. 10, determining a contravention and imposing the penalty. [13] I agree with the majority’s interpretation of the appeal provision. The fact that there is no appeal granted to an elector where the member is found not to be in conflict makes sense in the context of the purpose of this Act. An elector is entitled to have a hearing of his or her allegation, but if it is found to be without merit, then that finding is final and the member may continue to represent his or her constituents for the balance of the term. There is no right to an appeal in law; an appeal is granted by statute, and if not granted, does not exist as an inherent right: R. v. H. (E.) (1997), 33 O.R. (3d) 202 at p. 208 (C.A.); Kourtessis v. M.N.R., [1993] 2 S.C.R. 53 at pp. 69-70. On the other hand, where a member is found to be in conflict of interest, a very serious matter, a right to appeal is granted. Nor does s. 15 of the Charter apply to require equality of appeal rights. [14] I also reject the alternative submission of the appellants that where there is no appeal to the Divisional Court, an appeal lies to the Court of Appeal under s. 6(1)(b) of the Courts of Justice Act, R.S.O. 1990, c. C.43. The MCIA provides a complete code for dealing with the possibility of conflict of interest by municipal politicians, including providing full procedural rights. Section 13 of the Act prohibits any disqualification proceedings other than under the Act, and s. 15 makes the Act prevail in the case of conflict with any other act. The appeal provided by s. 11 is the only appeal right under the Act. Conclusion [15] For these reasons, I agree with Jennings J. in the Divisional Court that that court had no jurisdiction to hear an appeal by the elector from the decision of Kelly J. that the respondent was not in a conflict of interest. I would dismiss the appeal from the order quashing the appellants’ appeal to the Divisional Court. Both parties agreed that there would be no costs of this appeal regardless of the result. RELEASED: “JUL -5 2010” “K. Feldman J.A.” “KF” “I agree M. Rosenberg J.A.” “I agree David Watt J.A.”