Decisions

TATC File No. P-4151-41
MoT File No. 5504-085973

TRANSPORTATION APPEAL TRIBUNAL OF CANADA

BETWEEN:

Island Express Air Inc., Applicant

- and -

Minister of Transport, Respondent

LEGISLATION:
Aeronautics Act, R.S.C., 1985, c. A-2, s. 7.7(1)
Canadian Aviation Regulations SOR/96-433, sub. 605.86(1)


Review Determination
Laura Safran


Decision: December 13, 2016

Citation: Island Express Air Inc. v. Canada (Minister of Transport), 2016 TATCE 35 (Review)

Heard in: Abbotsford, British Columbia, on September 27, 2016

REVIEW DETERMINATION AND REASONS

Held: The Tribunal concurs with the Minister's assessment of the penalty at the amount of $5,000 for a breach of subsection 605.86(1) of the CARs and, accordingly, dismisses this application.

The assessed penalty of $5,000 is payable to the Receiver General for Canada and must be received by the Tribunal within 35 days of service of this determination.

I. BACKGROUND

[1] On or about June 26, 2014, the applicant, Island Express Air Inc., being an air operator, permitted a Beech King Air B100 aircraft with Canadian registration C-FASN in its custody and control to conduct a take-off when the deicer line flex couplings were not replaced, as required by the applicant's Maintenance Schedule Approval (PR-ABB 151) as part of the “out of phase” tasks. As a result, it is alleged by the respondent, the Minister of Transport (Minister), that the applicant has contravened subsection 605.86(1) of the Canadian Aviation Regulations, SOR/96‑433 (CARs). The Minister has assessed a monetary penalty of $5,000 pursuant to subsection 7.7(1) of the Aeronautics Act, R.S.C., 1985, c. A‑2 (Act).

II. STATUTES AND REGULATIONS

[2] Subsection 7.7(1) of the Act states that:

7.7 (1) If the Minister believes on reasonable grounds that a person has contravened a designated provision, the Minister may decide to assess a monetary penalty in respect of the alleged contravention, in which case the Minister shall… notify the person of his or her decision.

[3] In this case, the Minister assessed a monetary penalty of $5,000 against the applicant for the alleged contravention of subsection 605.86(1) of the CARs, which states in part:

605.86 (1) Subject to subjection (3), no person shall conduct a take-off in an aircraft, or permit a take-off to be conducted in an aircraft that is in the person's legal custody and control, unless the aircraft is maintained in accordance with

(a) a maintenance schedule that conforms to the Aircraft Equipment and Maintenance Standards; and

(b) where the aircraft is operated under Subpart 6 of Part IV or under Part VII… a maintenance schedule approved by the Minister in respect of the aircraft operator…

III. PRELIMINARY ISSUES

(1) Disclosure

[4] I note that at the outset of the review hearing conducted earlier on this date concerning TATC file no. P-4241-41 (the “earlier hearing”), the applicant sought to raise a preliminary motion seeking postponement of the review hearing pending receipt by the applicant of files it had requested from the respondent pursuant to the Access to Information Act, R.S.C., 1985, c. A‑1, in order to obtain comparative information concerning the Minister's treatment of other operators in allegedly similar circumstances. Such preliminary motion also applied to the matters under consideration in this review hearing.

[5] At the earlier hearing, the Minister replied that such preliminary request had been made on September 20, 2016 and that on September 22, 2016 this Tribunal had denied the preliminary request.

[6] During the earlier hearing, I concurred with the Minister and confirmed that the Tribunal had responded on September 22, 2016 to the applicant's request of September 20, 2016 that it has no jurisdiction over access requests made pursuant to the Access to Information Act.

[7] Accordingly, the Tribunal reiterated its ruling made during the earlier hearing concerning the applicant's preliminary motion seeking a postponement of the earlier hearing and, therefore, the motion for postponement of this hearing was denied.

(2) Laying of a Charge against the Applicant

[8] The Minister's representative stated that the Notice of Assessment of Monetary Penalty in this matter was issued on June 10, 2015 by Mr. Toke Adams, the regional manager of Aviation Enforcement for the Pacific Region of Transport Canada. The charge related to the take-off of the King Air aircraft in question, which was under the legal custody and control of the applicant, when the deicer line flex couplings were not replaced, as required by the applicant's Maintenance Schedule Approval (PR-ABB-151) as part of the “out of phase” tasks. Such failure to replace the couplings was in contravention of subsection 605.86(1) of the CARs, resulting in a monetary penalty of $5,000 being assessed.

[9] On behalf of the applicant, Mr. Gerald Visser expressly admitted the alleged contravention of subsection 605.86(1) of the CARs but asserted that the applicant had “self-reported” the contravention to Transport Canada and taken the necessary corrective action while also retaining a third-party expert to undertake a comprehensive audit of all of the applicant's systems. Mr. Visser explained that a former maintenance employee of the applicant was not able to locate the coupling in question and was under the mistaken belief that the aircraft did not have such coupling. When the applicant became aware of the error, it reported the error to Transport Canada and took the corrective action.

[10] Mr. Visser further reiterated the arguments he had made during the earlier hearing that other operators have missed similar errors and not been penalized and that the applicant historically has had a “poor relationship” with Transport Canada involving excessive monitoring by and penalizations assessed against the applicant by Transport Canada. Mr. Visser noted that the applicant had been working to improve the relationship and that the relationship had recently improved.

[11] Mr. Visser concluded his opening remarks by stating that the sanction in this case was excessive, particularly considering excessive penalization of the applicant by Transport Canada for past infractions.

[12] This Tribunal accepted such admission of the offence by the applicant and, on the basis of the same reasoning that applied at the earlier hearing, this Tribunal rejected the consideration of similar offences by other operators. Considering the agreed facts from the parties regarding the violation, it was determined that the review hearing would proceed with respect to the quantum of the monetary penalty.

IV. EVIDENCE

A. Minister

(1) Saeid Namazi

[13] Mr. Namazi testified that he is an enforcement investigator for Transport Canada and has held that position for approximately 18 months, prior to which he was a Transport Canada airworthiness inspector for approximately six years.

[14] Mr. Namazi referred to the Notice of Assessment of Monetary Penalty of $5,000 issued by Transport Canada to the applicant on June 10, 2015 as a result of the contravention of paragraph 605.86(1)(b) of the CARs. Mr. Namazi confirmed that the sanction in this case was in conformity with Transport Canada's non-binding instructions to its staff concerning a first-level sanction for a company and that there were no mitigating or aggravating factors that impacted the assessment. The applicant chose not to cross-examine Mr. Namazi.

B. Applicant

(1) Gerald Visser

[15] Mr. Visser, in his position as operations manager and accountable executive of the applicant, indicated that the evidence of the past relationship between the applicant and Transport Canada, as he had explained in detail during the earlier hearing, should be considered in respect of this matter and that the sanction imposed by the Minister was excessive in view of the historical relationship of the applicant and Transport Canada and the latter's more lenient treatment of other operators that had made similar errors without being penalized excessively, if at all.

[16] Mr. Visser advised that files he had requested from Transport Canada several months ago concerning similar offences by other operators had not been forthcoming, notwithstanding Mr. Visser's understanding that Transport Canada also wished to review them.

[17] Mr. Visser concluded that this Tribunal should consider the past relationship of the applicant with Transport Canada, the lack of response by Transport Canada to the applicant's request for files concerning similar offences, the fact that the error by the applicant in this case was reported to Transport Canada on a voluntary basis by the applicant and that the applicant had taken corrective actions.

[18] On cross-examination, Mr. Visser confirmed the statement he had made during the earlier hearing that the applicant's air operator certificate had not been suspended and also that the applicant had received oral counselling, in lieu of penalization, from Transport Canada following certain previous infractions.

[19] Mr. Visser, on cross-examination, also acknowledged, as he had during the earlier hearing, that the regulatory sanctions for contraventions applied equally to all carriers but again stated that a $5,000 penalty for a smaller air operator such as the applicant has far greater significance than the same penalty assessed against a major air carrier.

V. ARGUMENTS

A. Minister

[20] The Minister confirmed that since the applicant had admitted the offence, the only issue to be determined is the amount of the sanction. The Minister referred to the testimony of Mr. Namazi to the effect that a monetary penalty of $5,000 is a first-level sanction and a minimum penalty assessed against a corporation for contravention of the CARs and that, as testified to by Mr. Namazi, there were no mitigating or aggravating factors impacting the sanction.

[21] The Minister then referred to the TATC decision on appeal in Canada (Minister of Transport) v. Bickerstaff, 2014 TATCE 25 (Bickerstaff) for the proposition that if this Tribunal should find any mitigating factors that were not identified by the Minister, that such factors be considered in the context of the sentencing principles outlined in Canada (Minister of Transport) v. Wyer, [1988] CAT file no. O-0075-33 (Appeal) and reiterated in Bickerstaff, referring to the Aviation Enforcement Procedures Manual.

[22] The Minister reiterated that no exceptional circumstances were prevalent in this case and concluded that there were no mitigating factors justifying a decrease in the sanction imposed against the applicant.

B. Applicant

[23] Mr. Visser referred to his testimony and the closing statement he had made during the earlier hearing.

VI. ANALYSIS

[24] It is not at issue that on June 26, 2014, the applicant permitted a King Air B100 aircraft under its custody and control to conduct a take-off when the deicer line flex couplings were not replaced as required by the applicant's Maintenance Schedule Approval, in contravention of paragraph 605.86(1)(d) of the CARs.

[25] Mr. Visser, being the accountable executive of the applicant, admitted all elements of the offence and noted that the offence emanated from an error by an employee that, upon later discovery by the applicant, had been reported to Transport Canada and corrected by the applicant. Mr. Visser referred to his testimony in the earlier hearing concerning a history of alleged excessive monitoring of the applicant's operations by Transport Canada, together with alleged “bullying” tactics and excessive penalization of regulatory infractions on the part of Transport Canada and stated that those factors should be taken into consideration by this Tribunal in reviewing the monetary penalty. He also testified that other air carriers had also contravened the CARs but had not been penalized to the same extent as the applicant.

[26] Mr. Visser was unable to obtain evidence of infractions by other carriers that were of a similar nature to the infraction in this case and had resulted in no sanctions or reduced sanctions being assessed. Regardless, this Tribunal is of the view that the possibility of similar infractions by other carriers is not of relevance to the sanction imposed in this case. Additionally, the history, as alleged by the applicant, of Transport Canada having monitored its operations and penalized it excessively in the past does not justify the contravention by the applicant of the CARs in this case nor, in itself, does it justify a modification of the assessed monetary penalty.

[27] I also note that the penalty assessed for this infraction is a “first-level” minimum sanction of $5,000 according to Transport Canada's non-binding instructions to its staff.

[28] While the Minister has cited the Bickerstaff appeal decision with respect to an appropriate reduction of sanction as a result of mitigating factors, there is no evidence of exceptional circumstances in this case that would justify a penalty reduction. The fact the contravention was reported and corrected by the applicant is commended but needs to be weighed against the fact that this was a clear contravention of the CARs. Therefore the voluntary reporting and correction of this breach by the applicant does not, in our view, constitute an exceptional or mitigating factor so as to justify a decrease in the amount of the sanction.

VII. DETERMINATION

[29] The applicant has admitted the offence and therefore the only issue for this Tribunal to determine is whether the monetary penalty of $5,000 assessed against the applicant was excessive.

[30] The Tribunal finds no evidence of aggravating or mitigating circumstances insofar as this particular violation of the CARs is concerned.

[31] The Tribunal concurs with the Minister's assessment of the penalty at $5,000 for a breach of subsection 605.86(1) of the CARs and, accordingly, dismisses this application.

December 13, 2016

(Original Signed)

Laura Safran, Q.C.

Member