Are Prior Court Determinations Binding at Discipline?

We appreciate that there are few phrases in the regulatory world that are as frustrating as “it depends”. For example, take the question of whether a court determination of a factual issue is binding on a later discipline tribunal. In Immigration Consultants of Canada Regulatory Council v. Rahman, 2020 FC 832, http://canlii.ca/t/j97w4, the Court said that there is not a clear answer to the question.

In that case, the practitioner’s wife received payment of $15,000. The complainant said this was an advance for professional services that were promised, but not provided. The practitioner said it was a personal loan and there was no promise to provide services. The issue first went to Small Claims, Court which concluded the payment was a personal loan. The complainant then raised the same matter with the regulator. The regulator’s Discipline Committee concluded that the decision of the Small Claims Court was determinative, as it was a final decision on the same issue in respect of essentially the same parties, even though the regulator was prosecuting the case at discipline. As a result, the Discipline Committee determined that it was estopped, or prevented, from retrying the core question regarding the payment/loan on the basis of “issue estoppel”.

The Court noted that the tribunal’s analysis of issue estoppel fell short. According to the Court, the tribunal still had to “determine whether, as a matter of discretion, it ought to apply issue estoppel because it would be unjust to do so”. In failing to consider that issue, the tribunal had not fully considered the issue. The matter was returned to the regulator’s Discipline Committee for a new determination.

To further limit the amount of guidance offered by this decision on whether a discipline tribunal was bound by the finding of the Court, the case did not deal at all with the abuse of process argument that the discipline proceeding might constitute a collateral attack on the Small Claims Court proceedings.

Regulators should note that often there are not simple, clear answers in matters they deal with.

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