R v Ruzdiana, 2023 ABCJ 261

In the Alberta Court of Justice Citation: R v Ruzdiana, 2023 ABCJ 261 Date: 20231129 Docket: 220895809P1 Registry: Calgary Between: His Majesty the King - and - Sayad Arafath Ruzdiana Sentencing Decision of the Honourable Justice S.L. Van de Veen [ 1 ] The accused has been found guilty at trial of several charges under the Consumer Protection Act . He is guilty of three charges of engaging in the sale of motor vehicles without a license contrary to s 104(1) of the Act . He is also guilty of two charges of misleading and deceiving consumers contrary to s 6 (4)(

a) of the Act . He is finally guilty of three charges of failing to comply with an order of the Director of Fair Trading prohibiting him from continuing to sell motor vehicles and requiring him to remove vehicle advertisements on any form of news communication. [ 2 ] The facts are set out in my decision dated November 22, 2023 and I will not repeat them here. In

summary, the accused sold unroadworthy motor vehicles to three consumers in contravention of a Director's order dated March 22, 2019. In doing so, he misrepresented and deceived the consumers about the roadworthiness of the vehicles. In addition, the accused did not have a license to participate in the business of the sale of motor vehicles. [ 3 ] The aggravating factors in this case are: 1. There were multiple consumer victims, three in number. 2. The sales took place as part of a reasonably sophisticated business engaged in the unlawful sale of motor vehicles.

There were between 20 to 50 vehicles in a rural lot viewed by the Crown witnesses. The business ran for at least a number of months since the sales were made in both July and September of 2021. There were several ads on Kijiji advertising the sale of several vehicles at the lot where sales were conducted, that being 3313 R-84 St. NE Calgary. The accused was an integral part of this business. 3. The unlicensed sale of motor vehicles disqualifies the victims of access to the Compensation Fund for victims available to consumers who suffer loss as a result of transactions with businesses licensed under the Act . 4.

The vehicles sold were not only unroadworthy, but potentially dangerous. One had no catalytic converter for example, and could not contain oil. Another surged on the road and then failed to accelerate repeatedly. One had smoke and fire emanating from the engine as the consumer drove. [ 4 ] There are no mitigating factors available in this case. I am aware the accused has no record but at law this is not a mitigating factor.

Position of Crown and Defence [5] The Crown seeks fines of $1000 for each of Counts 2, 6 and 10, being the offences of selling motor vehicles without alicense contrary to s 104(1), $2000 for each of Counts 3 and 7, being offences of misleading and deceiving consumers contrary the s 6(4)(

a) of the Act, and $2000 for each of Counts 5, 9 and 13, being offences that the accused failed to comply with the order of the Directorof Fair Trading. Fines sought by the Crown total $13,000. In addition, the Crown seeks restitution orders for each of the consumersrespecting the direct loss caused by their purchase of the unroadworthy motor vehicles. The Crown seeks restitution orders in the amountof $2000 for Adrian Kehler, $1500 for Brandon Anderson and $950 for Rodney Sabanda. [6] Defence submits the fines not exceeding $5000 are appropriate and restitution is not disputed.

Legal Authorities [7] As Justice Fradsham stated in his decision R v Gardner, 2017 ABPC 11, the leading case respecting regulatory legislationsuch as the Consumer Protection Act is the decision of R v Wholesale Travel Group Inc. and Chedore, (1991) 130 NR1 (SCC). In thatdecision, Justice Corey stated the following: “[24] The objective of regulatory legislation is to protect the public or broad segments of the public (such as employees, consumers andmotorists, to name but a few) from the potentially adverse effects of otherwise lawful activity.

Regulatory legislation involves a shift ofemphasis from the protection of individual interests and the deterrence and punishment of acts involving moral fault to the protection ofpublic and societal interests.

While criminal offences are usually designed to condemn and punish past, inherently wrongful conduct,regulatory measures are generally directed to the prevention of future harm through the enforcement of minimum standards of conductand care.” [8] Justice Corey went on to caution that regulatory offences nevertheless must be taken seriously since offenders in regulatorymatters may inflict serious harm on large segments of society. Justice Corey went on to say, on page 17 the following: “...

At this stage it is sufficient to bear in mind that those who breach regulations may inflict serious harm on large segments of society.Therefore, the characterization of an offence as regulatory should not be thought to make light of either the potential harm to thevulnerable or the responsibility of those subject to regulation to ensure that the proscribed harm does not occur. It should also beremembered that, as social values change, the degree of moral blameworthiness attaching to certain conduct may change as well….

In short, regulation is absolutely essential for our protection and well being as individuals, and for the effective functioning of society. Itis properly present throughout our lives.

The more complex the activity, the greater the need for and the greater our reliance uponregulation and its enforcement.” [9] In the case at bar, the sale of motor vehicles is a business which very obviously could inflict significant harm, bothfinancially and from a personal safety point of view, if those who participate in such sales do not comply with the standards of theConsumer Protection Act, which includes licensing and providing accurate information to consumers.

In the case at bar it is not only thevictims who were at risk driving the vehicles which were unroadworthy, but also other users of the road in the proximity of theconsumers operating the unroadworthy vehicles. [10] Justice Corey emphasized this point at page 43 of R. v. Wholesale Travel Group Inc., supra, decision where he stated asfollows: “... The regulated actor is allowed to engage in activity which potentially may cause harm to the public.

That permission is granted on theunderstanding that the actor accept, as a condition of entering the regulated field, the responsibility to exercise reasonable care to ensurethat the proscribed harm does not come about.

As a result of choosing to enter a field of activity known to be regulated, the regulatedactor is taken to be aware of and to have accepted the imposition of a certain objective standard of conduct as a pre-condition to beingallowed to engage in the regulated activity.” [11] To underline the gravity of the offences before the court, it is notable that the Consumer Protection Act provides that thepenalty for any offence under the Act or the Regulations can either be a fine of not more than $300,000 or three times the amountobtained by the offender as a result of the offence, whichever is greater, or to imprisonment for not more than two years, or both.

TheSupreme Court of Canada has approved that such strong measures, including imprisonment in the decision of R. v. Wholesale TravelGroup Inc., supra, at p 56 where Justice Corey said: [114] Regulatory schemes can only be effective if they provide for significant penalties in the event of their breach. Indeed, although itmay be rare that imprisonment is sought, it must be available as a sanction if there is to be effective enforcement of the regulatorymeasure. Nor is the imposition of imprisonment unreasonable in light of the danger that can accrue to the public from breaches ofregulatory statutes….

The potential for serious harm flowing from the breach of regulatory measures is too great for it to be said thatimprisonment can never be imposed as a sanction.” [12] The Crown is not seeking imprisonment in the case at bar, nor would imprisonment be proportionate to the gravity of theoffence and the degree of the responsibility of the offender. [13] However, I adopt the reasoning of Justice Blair in the decision of R v Cotton Felts Ltd., (1982) (ON CA),2 CCC (3d 287) Ont. Ca.

When dealing with a regulatory offence under the Occupational Health and Safety Act of Ontario, he stated thatregulatory statutes ensure standards of conduct, performance and reliability by various economic groups and make life tolerable for all.For the most part, the enforcement of such statutes is achieved by fines, and the amount of the fine ought to be determined by the need toenforce regulatory standards by deterrence.

[ 14 ] The principle of deterrence is the primary sentencing principle in this case, but deterrence in the context of regulatory statutes has a broader meaning. Justice Blair in R v Cotton Felts Ltd. , supra , stated that deterrence in regulatory offences includes not only the denunciation of a course of conduct by the offender, but also emphasizes community disapproval of

an act and branding it as reprehensible. He stated this has a moral educative effect, and thereby affects the attitude of the public. Therefore, the aspect of deterrence in regulatory offences is particularly important because it is essential for the proper functioning of our society and for citizens at large to expect that basic rules are established and enforced to protect the physical, economic and social welfare of everyone. [ 15 ] The Crown in the case at bar submits that the misrepresentations made by the accused could also be called fraud.

Regulatory offences in general form a continuum ranging from the less serious to the very serious and the case at bar includes inherently wrongful conduct on the part of the accused for which there is a greater degree of moral blameworthiness.

The actions of the accused in this case “if not a species in the family of fraudulent conduct are close cousins” ( R v Kirk , [2002] OJ 4102 ) and the penalty for the offences before the court ought to reflect the greater degree of moral blameworthiness on the part of the accused in these cases. [ 16 ] In my view the sentence proposed by the Crown appropriately reflects the seriousness of the offending behavior and the potential for harm to both the victims and other members of the public.

In my view this sentence appropriately sends the necessary deterrent message to the accused as well as to those who might be tempted to engage in or continue to engage in the similar offending conduct. These fines are intended to adequately preserve the integrity of the legislation as an instrument of public protection. Although defence counsel suggests that the fines ought to be reduced as a result of the limited financial resources available to the accused, I am of the view that the amount of the fine should not be reduced from an otherwise appropriate level to accommodate this fact.

I note that the Fine Option Program could be of assistance to an offender who is unable to pay fines. Sentence [ 17 ] I sentence Mr. Ruzdiana to fines of $1000 each one Counts 2, 6 and 10, $2000 each on Counts 3 and 7, and $2000 each on Counts 5, 9 and 13. The fines imposed total $13,000. [ 18 ] In addition I grant s 738 Criminal Code Restitution Orders in favor of Adrian Kehler in the amount of $2000, Brandon Anderson in the amount of $1500, and Rodney Sabanda in the amount of $950. Dated at the City of Calgary, Alberta this 29 th day of November, 2023. S.L.

Van de Veen A Justice of the Alberta Court of Justice Appearances:

G. Whiteside for the Crown H. Sangha for the Accused