In Canada Cannabis Corporation (Re), 2022 ONSEC 9 the Ontario Securities Commission (OSC) was called upon to decide whether section 4.3 of the Statutory Powers Procedure Act (SPPA) operated to extend the term of office of a Commissioner (the Commissioner) until completion of a motion by a respondent in an OSC enforcement proceeding and an application by that respondent for a variation of an order made by the Commission.
Section 4.3 of the SPPA provides that if the term of office of a member of a tribunal who has participated in a hearing expires before a decision is given, the term shall be deemed to continue for the sole purpose of participating in the decision.
In April 2020 Silvio Serrano, one of the respondents to an OSC enforcement proceeding, brought a motion to the Commissioner to require that Serrano be provided with information concerning the basis for redactions made to transcripts of the compelled examination of a co-respondent pursuant to a Confidential Order issued by the Commission, including a copy of the Confidential Order and any decision or reasons that accompanied the Confidential Order. To the extent that the Confidential Order precluded the relief sought by Serrano in the motion, he also brought an application to vary the Confidential Order to allow for such relief (together, the Motion and Application). The redacted transcripts of the co-respondent had been provided to Serrano by OSC enforcement staff pursuant to Staff’s pre-hearing disclosure obligations in the enforcement proceeding.
The Commissioner in question had initially presided over all hearings in relation to Serrano’s Motion and Application until his term expired in early 2021. After expiry of his term, a new Hearing Panel assumed carriage of the proceedings.
In June 2021 Serrano brought a motion seeking an order declaring that the Commissioner’s term of office be extended pursuant to section 4.3 of the SPPA until a decision was rendered on the Motion and Application, and an order declaring that the New Hearing Panel was without jurisdiction to hear the Motion and Application or that it was inappropriate for it to do so unless the matter is reheard de novo (the Panel Composition Motion).
The new Hearing Panel disagreed with Serrano’s suggestion that section 4.3 operated to extend the Commissioner’s term. The Commissioner’s participation in the Motion and Application had been limited to preliminary procedural matters only and did not extend to hearing submissions and reviewing evidence on the merits of the Motion and Application. Accordingly, the Commissioner was found not to have participated in the Motion and Application “to the extent necessary to trigger s. 4.3 of the SPPA”.
The new Hearing Panel also determined that the change in the composition of the adjudicative panel a year after the commencement of Serrano’s Motion and Application and prior to its completion did not breach procedural fairness and the core principle of audi alteram partem, which did not require that the same adjudicative panel hear all aspects of a matter. In particular, it may be appropriate for one panel to preside over pre-hearing management rulings and another panel preside over the hearing on the merits. This was also consistent with the Commission’s authority under the SPPA to determine its own procedure by making orders and rules governing practice and procedure before it.
In the particular circumstances of the Motion and Application, including that the new Hearing Panel considered that it was in as good a position as the Commissioner to make a decision on the merits of the Motion and Application, it was not unfair for the new Hearing Panel to remain seized of the matter. Serrano’s Panel Composition Motion was dismissed on that basis and the new Hearing Panel proceeded to determine the Motion and Application, which resulted in an order that Serrano and the other respondents in the enforcement proceeding be provided with a redacted copy of the Confidential Order and Reasons and additional information concerning the legal basis for the redactions to the transcripts.
