Decisions

TATC File No. MA-0028-37
MoT File No. A20090915-101-00055

TRANSPORTATION APPEAL TRIBUNAL OF CANADA

BETWEEN:

Richard Caines, Applicant

- and -

Minister of Transport, Respondent

LEGISLATION:
Canada Shipping Act, 2001, S.C. 2001, c. 26, paragraph 106(2)(a)


Review Determination
Yves Villemaire


Decision: August 24, 2011

Citation: Caines v. Canada (Minister of Transport), 2011 TATCE 21 (Review)

Heard at Corner Brook, Newfoundland and Labrador, on February 24, 2011

Held: The Minister has proven, on the balance of probabilities that Richard Caines, as the authorized representative of the fishing vessel Sea Doo, contravened paragraph 106(2)(a) of the Canada Shipping Act, 2001. The Minister, however, failed to explain how the amount of the penalty established for a vessel can and should be applied to Mr. Caines. Therefore, the penalty is reduced from $7 800 to $1 600.

The total amount of $1 600 is payable to the Receiver General for Canada and must be received by the Transportation Appeal Tribunal of Canada within thirty-five (35) days of service of this Determination.

I. BACKGROUND

[1] The Minister of Transport ("Minister") alleges that Richard Caines, as the authorized representative of the fishing vessel Sea Doo, failed to ensure that the vessel and its machinery and equipment were inspected for the purpose of obtaining all of the Canadian maritime documents required under Part 4 of the Canada Shipping Act, 2001 ("Act") thereby contravening paragraph 106(2)(a) of the Act.

[2] In particular, the Minister alleges that the vessel was at sea on or about July 4, 2009, without holding a valid Canadian Vessel Inspection Certificate as required by subsection 10(1) of the Vessel Certificates Regulations.

[3] On September 15, 2009, a Notice of Violation ("Notice") was issued to Mr. Caines for contravening paragraph 106(2)(a) of the Act. The penalty was set at $7 800.

[4] Schedule A of the Notice provides as follows:

On or about July 4, 2009 at or near Flat Island in position 50 50.41N and 057 17.7W in the province of Newfoundland and Labrador, Richard Caines, being the authorized representative of the vessel "Sea Doo", failed to ensure that the vessel and its machinery and equipment were inspected for the purpose of obtaining all of the Canadian maritime documents required under Part 4 of the Canada Shipping Act, 2001, thereby contravening paragraph 106(2)(a) of that Act.

In particular, the vessel engaged on a voyage without holding a valid Canadian Vessel Inspection Certificate as required by subsection 10(1) of the Vessel Certificates Regulations.

Penalty: $7,800.00

[5] On October 23, 2009, Mr. Caines filed a request for review of the Minister's decision with the Transportation Appeal Tribunal of Canada ("Tribunal").

II. STATUTES AND REGULATIONS

[6] Section 2, subsections 14(1) and (2), paragraph 16(2)(c), subsection 17(1), paragraphs 106(2)(a), 120(1)(d), (e), (f), and (g) and subsections 254(1) and (2) of the Act provide the following:

2. The definitions in this section apply in this Act.

"authorized representative" means, in respect of a Canadian vessel, the person referred to in subsection 14(1) and, in respect of a foreign vessel, the master.

14. (1) Every Canadian vessel must have a person — the authorized representative — who is responsible under this Act for acting with respect to all matters relating to the vessel that are not otherwise assigned by this Act to any other person.

(2) Subject to subsections (3) and (4), the authorized representative of a Canadian vessel is the owner of the vessel or, in the case of a vessel described in section 48 (a bare-boat chartered vessel), the bare-boat charterer.

16. (2) In addition to the specified information or documents, the Minister of Transport may

(c) if the document is in respect of a vessel, require that the vessel or its machinery or equipment undergo any inspections that the Minister considers necessary to establish that the requirements for the issuance of the document have been met.

17. (1) Every Canadian maritime document is valid for the period specified by the Minister of Transport. The Minister may, on application made before a document expires and in the form and manner specified by the Minister, extend the period if the Minister is satisfied that it is not feasible to issue a new document before the document expires.

106.(2) The authorized representative of a Canadian vessel shall ensure that

(a) the vessel and its machinery and equipment are inspected for the purpose of obtaining all of the Canadian maritime documents that are required under this Part; and

120. (1) The Governor in Council may, on the recommendation of the Minister, make regulations respecting the safety of vessels or classes of vessels and of persons on board or loading or unloading a vessel, including regulations

(d) respecting the requirements that vessels, or classes of vessels, and their machinery and equipment must meet;

(e) requiring the obtaining of certificates certifying that any of the requirements referred to in paragraph (d) are met;

(f) specifying the terms and conditions of certificates issued under this Part;

(g) respecting inspections and the testing of vessels, or classes of vessels, and their machinery, equipment and supplies;

254. (1) No person may be found guilty of an offence under this Act if the person establishes that they exercised due diligence to prevent its commission.

(2) No vessel may be found guilty of an offence under this Act if the person who committed the act or omission that constitutes the offence establishes that they exercised due diligence to prevent its commission.

[7] Subsections 10(1) and (2) of the Vessel Certificates Regulations provide the following:

10. (1) No vessel shall engage on a voyage unless it holds a certificate issued under subsection (2).

(2) On application by the authorized representative of a vessel, the Minister shall issue an inspection certificate to the vessel if the requirements under the Act that apply in respect of the vessel when engaged in its intended service are met.

[8] Paragraphs 5(1)(a) and (b) and 49(1)(a) of the Small Fishing Vessel Inspection Regulations provide the following:

5. (1) Subject to subsections (2) and (3), this Part applies to every fishing vessel that

(a) exceed 15 tons, gross tonnage, but does not exceed 150 tons, gross tonnage;

(b) does not exceed 24.4 m in length; and

49. (1) Notwithstanding the requirements for periodic inspection prescribed in this Part, an inspector may issue or extend an inspection certificate for a period not exceeding

(a) two months beyond the due date of periodic inspection; or

[9] Paragraph 15(1)(a) of the Ship Station Technical Regulations, 1999, provide the following:

15. (1) A VHF radio installation on a ship shall be capable of transmitting and receiving

(a) communications using DSC on frequency 156.525 MHz (channel 70), and

III. ELEMENTS TO BE PROVEN

[10] Based on the Notice, I identified the following elements to be proven by the Minister:

a) At the time of the incident, on or about July 4, 2009, the fishing vessel Sea Doo was a Canadian vessel.

b) The Sea Doo was on a voyage at the time of the incident.

c) The Sea Doo did not hold a valid Canadian Vessel Inspection Certificate at the time of the incident.

d) Mr. Caines was the authorized representative of the Sea Doo at the time of the incident.

IV. EVIDENCE

A. Minister of Transport

(1) Clement Murphy

[11] Clement Murphy is a Manager with Transport Canada, Marine Safety, Compliance and Enforcement, in St. John's, Newfoundland. He testified that the vessel Sea Doo is a 39-foot fishing vessel of 33.54 gross tons that holds a registry certificate valid until April 30, 2013. He also indicated that the authorized representative is Mr. Caines (Exhibit M-1).

[12] Inspector Murphy testified that the vessel was operating at sea on July 4, 2009. He indicated that James J. Kenny, Manager of Inspection Services with Transport Canada Marine Safety in St. John's, Newfoundland, informed him by an email of July 6, 2009, that at 0350 UTC on July 4, 2009 the Sea Doo ran aground at position 500 50.4'N, 0570 17.74W on Flat Island in the area of Port aux Choix and reported water entering the vessel (Exhibit M-2).

[13] Inspector Murphy testified that Mr. Kenny advised him that he had reasons to believe this vessel was not certified since there was no record of current certification for the vessel in the Ship Inspection Reporting System ("SIRS") database. In addition, Mr. Kenny had verified with the Manager of Technical Services and found no record of the vessel having its stability conditions approved by Transport Canada for the capelin and herring fisheries as was required by the Small Vessel Regulations.

[14] Inspector Murphy testified that he also received an Occurrence Report from Vessel Traffic Services Station, St. John's, indicating that the Sea Doo ran aground on Flat Island on July 4, 2009, at 0350 UTC. The Canadian Coast Guard Cutter ("CCGC") Cape Norman was tasked to assist, later reporting that it was on scene monitoring the situation (Exhibit M-3).

[15] Inspector Murphy testified that he also received a copy of the Daily Operational Briefing from Vessel Traffic Services showing the Sea Doo reports of grounding on Flat Island and receiving assistance from CCGC Cape Norman. He testified that this report is developed to provide the Commissioner's daily briefing and contains the date and the names of the watch supervisor for the day and night shifts (Exhibit M-4).

[16] Inspector Murphy testified that his research indicated that the Sea Doo did not hold the required Canadian maritime documents for a vessel to be at sea. He produced a copy of a post Inspection Report taken from the SIRS database showing the last date of issue as 2005.04.19 with an expiry date of 2005.05.19 for the vessel's Inspection Certificate (Exhibit M-5). He testified that everything that is done with regard to a vessel inspection and certification is entered into the SIRS database to be made available to all inspectors across the country. He testified that the searches conducted by him and by Mr. Kenny showed the inspection certificate for the Sea Doo to have expired on May 19, 2005.

[17] Inspector Murphy also testified that the vessel's last Inspection Certificate expired May 20, 2005 (Exhibit M-6). In support of this, a hand written annotation on this document states "19 April 2005, Parsons Pond. This certificate is hereby extended to expire 20 May 2005." He indicated that between 2005 and 2009 there were no other documents showing that an inspection was carried out on the Sea Doo and therefore, at the time of the incident, the vessel had been operating for over four years without a valid Canadian maritime document.

B. Applicant

(1) Richard Caines

[18] Mr. Caines testified that when he had the Sea Doo inspected in 2005 everything was "up to par" but that he was also required to have a marine distress radio installed. He testified that the inspector had asked him to test the radio by calling the Coast Guard station and that it functioned correctly. He stated that he informed the Marine Safety Inspector that he could not program the radio as he did not have the numbers. He explained that numbers are supposed to be programmed so that with a single touch, a message can be sent directly to the Coast Guard in the event of an emergency.

[19] Mr. Caines testified that he asked every technician who knows how to do it but was unable to find anyone to program the radio. He stated that he was concerned about rendering this costly equipment inoperable should he attempt inputting the numbers himself. He indicated that the Inspector provided a three month extension on the inspection certificate to allow him to have the radio programmed.

[20] Mr. Caines testified that as the Sea Doo was his only source of income he continued fishing with the boat after the Inspection Certificate had expired. He stated that the non-programming of the radio was the only deficiency that existed; everything else with the boat met the requirements of the four year Inspection Certificate. He stated that the Marine Safety Inspector provided an Inspection Certificate that was good for three months and that he was not pretending that it would last for four years. He testified that when the four years were up, he asked for a new inspection, this time with the radio programmed. He stated that the radio has since been programmed and that the vessel currently holds a valid inspection certificate.

[21] Mr. Caines testified that he cannot explain why he could not find anyone to program the radio as required by the Marine Safety Inspector. He stated that he tried on many occasions to call the technicians he knew to program the radio but for some unknown reason nobody came. He explained that eventually, in November 2009, he left the radio with a friend, a technician who came back from the Northwest Territories, and the programmed radio was returned to him in April 2010.

[22] Mr. Caines testified that he knew the Inspection Certificate was going to expire and stated "I never had this piece of paper saying the Certificate is valid for the next four years, he gave me three months." He explained that his boat was required to carry the new programmable VHF marine distress radio in addition to the ordinary VHF radio.

[23] In cross-examination, Mr. Caines testified that he could not obtain assistance from the supplier, Wayne Howse, to program the radio. He explained that Mr. Howse is not a technician but a merchant who does not possess the required expertise to program radios. He stated that every time he asked for assistance in programming the radio he could not find help, either because they did not know how to do it or they did not have the time.

[24] In cross-examination, Mr. Caines testified, after some clarification about the dates, that he was operating without a valid Inspection Certificate from May 2005 until April 2010, a period of five years. He acknowledged that, had he complied with the condition for the extension of the Inspection Certificate, the Certificate would have been valid only until April 2009. He stated, however, that he had not realized that the four year period of validity was up because he did not think that much time had elapsed. He explained that the boat flares were still valid and, given that their period of validity is four years, that led him to believe that only four years, not five, had elapsed.

[25] Mr. Caines testified that he has owned a certified boat for many years and went through the certification process before, although this was the first time that the inspection included a programmable marine distress VHF radio. He stated that he received a call from the Coast Guard after the incident on Flat Island informing him that his boat needed to be certified. He reiterated that he could not get an Inspection Certificate unless the radio was programmed. He stated that he got his certification for only three months in order to get the radio working but he continued fishing afterwards as he did not have any other occupation.

V. ARGUMENTS

A. Minister of Transport

[26] The Minister's representative submits that the evidence presented shows that the vessel went to sea without the required Canadian maritime document, therefore contravening paragraph 106(2)(a) of the Act and sections 9 and 10 of the Vessel Certificate Regulations. The Minister's representative states that all the elements have been proven and are not contested.

[27] The Minister's representative submits that, under section 17 of the Act, "Every Canadian maritime document is valid for the period as specified by the Minister of Transport." She indicates that the certificate in question specified an expiry date of May 2005. As it took five years for Mr. Caines to comply with the Regulations, she indicates that a due diligence defence is not admissible as set out in section 254 of the Act. She indicates that there are about 6 000 fishing vessels in Newfoundland and that during the period in question other fishing vessels were having their radio programmed in compliance with the Regulations. She contends that encountering difficulties in getting the radio program does not justify committing the violation. She states that it is unfortunate that Mr. Caines could not have complied before and that eventually an incident happened and he got caught. But during all this time, he was knowingly operating the vessel without an Inspection Certificate.

[28] The Minister's representative submits that, although Mr. Caines mentioned his belief that the certificate was valid for four years, the fact that it took him five years to obtain a valid certificate should be considered an aggravating factor. She explains that as the range of penalties vary from $1 250, to $25 000, a penalty of $7 800 was assigned by applying $6 000 for the vessel plus 30 percent considering the length of time it took to comply.

B. Applicant

[29] The Applicant submits that he was unable to have the radio programmed and, without this, he could not obtain an Inspection Certificate. With respect to the fine, he states that it is "a bit overboard," and that given his income he may have to get out of the fishery business if he has to pay the amount of penalty as established by the Minister.

VI. ANALYSIS

[30] Inspector Murphy submitted the Transcript of Registry for the Sea Doo (Exhibit M-1). This document shows that the Sea Doo was registered as a Canadian vessel as of January 3, 1990, with a current expiry date of April 30, 2013. I accept the evidence presented by the Minister and conclude, on the balance of probabilities, that at the time of the incident, on or about July 4, 2009, the Sea Doo was a Canadian vessel. Therefore, the first element of the alleged violation is proven.

[31] Inspector Murphy testified that the vessel was operating at sea on July 4, 2009, on the basis of an email indicating that the Sea Doo ran aground on Flat Island at 0350 UTC on that date (Exhibit M-2). This is confirmed by an Occurrence Report from Vessel Traffic Services Station, St. John's (Exhibit M-3) and a Daily Operational Briefing from Vessel Traffic Services (Exhibit M-4). I accept the evidence presented by the Minister and conclude, on the balance of probabilities, that the Sea Doo was on a voyage at the time of the incident. Therefore, the second element of the alleged violation is proven.

[32] Inspector Murphy testified that the Sea Doo did not hold the required Canadian maritime documents for a vessel to be at sea based on the SIRS database. He testified that the searches conducted by him and by Mr. Kenny showed the Inspection Certificate for the vessel to have expired on May 19, 2005 and that between 2005 and 2009 there were no other documents showing that an inspection was carried out on the vessel (Exhibit M-5). Inspector Murphy testified that the vessel's last Inspection Certificate expired May 20, 2005 (Exhibit M-6). Although an apparent discrepancy of one day seems to have been introduced in the documentation, it shows that, at the time of the incident, no Inspection Certificate had been issued to the Sea Doo since May 2005.

[33] Mr. Caines explained that when he had the Sea Doo inspected in 2005 all equipment on the vessel was compliant except for the Digital Selective Calling ("DSC") VHF marine radio that needed to be programmed. Paragraphs 120(1)(d), (e), (f) and (g) of the Act provides for the requirements that vessels must meet, in order to obtain an Inspection Certificate, including various conditions and testing. In addition, paragraph 15(1)(a) of the Ship Station Technical Regulations, 1999 provides that a VHF radio installation on a ship shall be capable of transmitting and receiving using DSC on a specified frequency. Mr. Caines explained that he was unable to program the radio himself for that purpose and testified that he asked every technician that he knew but was unable to find anyone to program the radio as required. During his testimony, he was unable to explain the reason for his difficulties in obtaining this technical service.

[34] As provided in subsection 17(1) of the Act, the Minister may extend the period of validity of a certificate if it is not feasible to issue a new document before the document expires. To this effect, a hand written annotation on the Inspection Certificate (Exhibit M-6) shows an extension of one month to the Certificate. This is consistent with paragraph 49(1)(a) of the Small Fishing Vessel Inspection Regulations providing a maximum of two months for an extension. Despite this evidence, Mr. Caines indicated that he believed the Inspector provided a three-month extension to have the radio programmed. He also testified that, as the Sea Doo was his only source of income, he continued fishing with the boat after the Inspection Certificate had expired; presumably this meant three months after the inspection. During his testimony, Mr. Caines implied that once the Inspection Certificate expired it would have been pointless to request a new inspection without having the radio programmed. Further, he seemed to imply that since everything else on the vessel was compliant, including the other VHF radio, the standard four‑year interval between inspections should still apply. His testimony showed nonetheless that he understood the Certificate to have been extended for three months only and was not valid for the standard four-year period. Therefore, the decision to behave as if a four‑year Certificate had been issued was entirely his own, with the attendant risks associated with that conduct.

[35] After clarification, Mr. Caines acknowledged that he had actually operated the vessel without a valid certificate for a period of five years. He explained, however, that he had not realized that a full year had elapsed since the standard four-year expiry date of 2009 on which he seemed to have based his decision to continue fishing. In fact, based on his testimony, I conclude that Mr. Caines decided to continue fishing without a valid Inspection Certificate even after being informed by the Coast Guard following the incident on Flat Island in July 2009 that the Inspection Certificate for his vessel was not valid.

[36] I found Mr. Caines to be a credible witness and accept his evidence that his request to have the VHF radio programmed was declined. Subsections 254(1) and (2) of the Act provide for a defence of due diligence; however, the facts of the case do not lead me to conclude that Mr. Caines' actions met the threshold required for due diligence. To reach this conclusion, I take into account the fact that Mr. Caines has many years of experience as the owner of a fishing vessel that requires an inspection every four years. Had he provided evidence of significant efforts to obtain, from various sources, the service of a technician to program the DSC VHF radio or to seek assistance from the Marine Safety Inspector to meet this requirement this could have shown due diligence.

[37] I also accept Mr. Caines' evidence that he inadvertently relied on the period of validity of the flares to assess the expiry date of the vessel's Inspection Certificate. The evidence, however, does not alter the inescapable conclusion that Mr. Caines knowingly operated a vessel without a valid Inspection Certificate. Paragraph 106(2)(a) of the Act clearly states that the authorized representative shall ensure that the vessel's equipment must be inspected in order to obtain all the required Canadian maritime documents. I accept the evidence presented by the Minister and conclude, on the balance of probabilities, that the Sea Doo did not hold a valid Canadian maritime document. Therefore, the third element of the alleged violation is proven.

[38] Subsection 14(1) of the Act states that a vessel must have an authorized representative and subsection 14(2) states that the owner is the authorized representative of a vessel subject to subsections 14(2) and (3). The Transcript of Registry (Exhibit M‑1) shows Mr. Caines as the owner and authorized representative for the vessel. Inspector Murphy testified that Mr. Caines was the authorized representative of the Sea Doo at the time of the incident. I accept the evidence presented by the Minister and conclude, on the balance of probabilities, that Mr. Caines was the authorized representative of the Sea Doo at the time of the incident. Therefore, the fourth element of the alleged violation is proven.

[39] The Minister's representative argued that 6 000 fishing vessels operating in Newfoundland managed to comply with the Regulations during the period in question and that Mr. Caines was knowingly operating for five years without an Inspection Certificate and was caught as a result of the incident of July 2009. She argued that the fact that it took him five years to obtain a valid Certificate should be considered an aggravating factor. I am inclined to agree with this conclusion. Mr. Caines admits being aware of operating without a valid Inspection Certificate for at least four years. Yet, he failed to demonstrate in his testimony that he made any attempt to ascertain at which date this normal four-year period would end and relied on the usual expiry date of the flares instead of the information provided on the certificate of inspection.

[40] The Minister's representative explained that as the range of penalties vary from $1 250 to $25 000, a penalty of $7 800 was set by applying the minimum $6 000 normally charged to a vessel plus 30 percent considering the length of time it took to comply. I find that a fuller explanation of the rationale for the 30 percent increase over the amount of $6 000 for the first violation of high gravity for a vessel would have been beneficial. Specifically, it would have been useful to describe the factors that led the Minister to attribute an amount of penalty greater than that provided for a first violation. Nonetheless, considering that the Applicant knowingly operated a vessel without a valid maritime document even after being informed by the authorities that he was in violation constitutes an aggravating factor and therefore justifies attracting an additional amount of penalty over the minimum normally assigned by departmental policy.

[41] Significantly, the Minister failed, to explain how the amount of penalty established for a vessel can be applied in the case of a failure of the authorized representative, as an individual to discharge his duty with regard to the vessel under paragraph 106(2)(a). The Regulatory Impact Analysis Statement ("RIAS") accompanying the Administrative Monetary Penalties Regulations, but not forming part of them, provide a range of penalties from $1 250 to $6 000 for individuals and Vessels/Corporations for a first violation. The RIAS indicate that as a matter of general policy, vessels and corporations will be subject to higher penalties than individuals for the same offence. In this case, Ms. Corado testified that the minimum amount for a vessel, $6 000, was selected as the departing point to establish the penalty. Yet, the Notice of Violation was issued to Mr. Caines as the authorized representative for failing to ensure the vessel had undergone the necessary inspection. I cannot therefore sanction a penalty directed towards the vessel itself or any other penalty than one established for an individual. Having recognized that the violation must attract an additional amount of penalty over the minimum of $1 250 for an individual, I establish the amount of penalty at $1 600.

VII. DETERMINATION

[42] The Minister has proven, on the balance of probabilities, that Richard Caines, as the authorized representative of the fishing vessel Sea Doo, contravened paragraph 106(2)(a) of the Canada Shipping Act, 2001. The Minister, however, failed to explain how the amount of the penalty established for a vessel can and should be applied to Mr. Caines. Therefore, the penalty is reduced from $7 800 to $1 600.

August 24, 2011

Yves Villemaire

Member