Former North Bay bar owner wins battle against the Alcohol and Gaming Commission

Problems began when Nathan Taus sold the restaurant and bar to Fox North Bay Inc. in January 2020, during the height of the COVID-19 pandemic. (File)

A judge has ruled in favour of the former owner of the Fox & Fiddle in North Bay, who took the Alcohol and Gaming Commission of Ontario to court to fight an attempt to ban him from the business.

Problems began when Nathan Taus sold the restaurant and bar to Fox North Bay Inc. in January 2020.

"Nathan Taus had been the owner and manager for the previous 10 years and the intention was that he would continue to be the manager under the new ownership," said the transcript of the case from the Superior Court of Justice.

But when the new owners applied to have the liquor license transferred to them, the AGCO imposed six new conditions, including ones banning Taus.

"Three conditions related to a complete ban on Mr. Taus being involved in any way with the business, which included a ban on him attending the premises or being employed in any capacity," the transcript said.

The new owners also run a cannabis store and Taus was banned from that business, as well. The commission later backtracked, allowing Taus on the premises but not allowing him to work there.

In its defence, the AGCO referred to an Oct. 20, 2020, incident when it visited the North Bay bar as part of its assessment.

"A compliance officer attended the restaurant for an inspection and alleged that Mr. Taus was not wearing a mask or social distancing," the transcript said.

"Mr. Taus made an inappropriate comment to the compliance officer, causing him to leave the establishment without completing the inspection."

No written report on the incident was completed, and Taus and the new owners weren’t given a chance to respond. The commission released its assessment Nov. 17, 2020, and cited previous incidents involving Taus, highlighting the Oct. 20 incident.

In response, the new owners suggested Taus be banned for just six months, but the AGCO refused. Then in March 2021, Fox North Bay applied for a cannabis licence and was told the same conditions on Taus would apply.

The company sued late last year.

Taus told CTV News reporter Jon Woodward that he thought the inspectors were using a loophole in the law to settle a personal score.

"We don't think the punishment fits the crime," he told Woodward.

"There should be a tribunal, a hearing, some kind of arbitration and in this case, there's none of that. We want to change that from the inside out."

He also admitted to making a comment to the inspector, which he said was driven by frustration and anxiety caused by the pandemic.

'DON'T MESS WITH MY LIVELIHOOD'

During an inspection at the Fox and Fiddle in October 2020, Taus told a liquor inspector, “Don’t mess with my livelihood and I won’t mess with yours,” the lawsuit said.

Taus told CTV News Toronto he apologized for the interaction almost immediately, saying COVID-19 measures that had hurt his bar’s bottom line had been wearing on him.

"I was emphatically apologetic," Taus told Woodward. "With all the things going on in the world, I was frustrated and I felt like I was being targeted a little bit."

The lawsuit argued that had the inspector made specific allegations of breaching the rules, they could have appealed or dealt with them. Instead, it was declared a public risk, something that can’t be appealed under Ontario’s Liquor Licensing Act.

That prompted the lawsuit as the only way to fight the ban.

In its decision, the court said the effect of the ban had a huge impact.

"Taus's ability to carry on business and earn a livelihood was put at risk," the transcript said.

"Banning him from his employment in a position he had occupied for the past 10 years in an industry that he had been employed in for the past 25 years was of high importance to Mr. Taus."

To make a decision with such a large impact, the AGCO had an extra duty of fairness and openness, the court ruled. In this case, however, the commission opted for a process that denied Taus and the bar owners transparency and an opportunity to make their case.

"In cases involving breaches of procedural fairness, the court will generally set aside the decision without considering whether the result would have been the same had there been no unfairness," the judge ruled.

"In my view, that is the correct approach ... Accordingly, the decisions of Dec. 22, 2020, and Nov. 2, 2021, are quashed and the matters are remitted to the registrar for reconsideration."

Read the full transcript here.