Sanctions and Decisions

DATE OF HEARING:

HEARING PANEL:

HEARING BEFORE A PANEL OF THE BOARD OF ALBERTA GAMING, LIQUOR AND CANNABIS COMMISSION

IN THE MATTER OF the Gaming, Liquor and Cannabis Act Revised Statutes of Alberta 2000, Chapter G-1, as amended and the Regulation

and

2249392 Alberta Ltd. o/a Premier Wine Spirits and Liquor (Applicant) 208E Haddon Road SW Calgary, AB T2V 2Y7

APPLICANT / REPRESENTATIVE:

REGULATORY SERVICES DIVISION:

July 26, 2023

Vincent Vavrek, Presiding Member Patti Grier, Panel Member Tongjie Zhang, Panel Member

Gurpartap Singh Walia, Owner/Operator

Toni Hazelwood, Hearing Officer

DECISION OF THE HEARING PANEL The Panel finds that the Applicant (Licensee) contravened sections 69(1)(a) and 69(1)(c) of the Gaming, Liquor and Cannabis Act (the Act). The Panel finds, in accordance with section 92(1) of the Act, the licensee has become ineligible to hold a licence.

As such, in accordance with sections 91 and 94(7)(b) of the Act, the Panel replaces the immediate suspension of the Class D-Retail Liquor Store Licence numbered 781684-1 with a cancellation of the liquor licence.

The Class D-Retail Liquor Store Licence numbered 781684-1 is cancelled effective immediately upon issuance of this decision.

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I. Jurisdiction and Preliminary Matters [1] By letter dated June 9, 2023 the Regulatory Services Division (Regulatory Services) of the Alberta Gaming, Liquor and Cannabis Commission (AGLC) advised 2249392 Alberta Ltd., operating as Premier Wine Spirits and Liquor, that the licensee contravened:

•

•

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Section 69(1)(a) of the Act: No liquor licensee or employee or agent of a liquor licensee may permit any activity in the licensed premises that is contrary to any municipal bylaw or any Act or regulation of Alberta or Canada; Section 69(1)(c) of the Act: No liquor licensee or employee or agent of a liquor licensee may permit any activity in the licensed premises that may be injurious to the health or safety of people in the premises; and Section 92(1) of the Act: The board may do any one or more of the things referred to in subsection (2) if, after a licensee or registrant becomes ineligible to hold a licence or to be registered because of either the licensee’s or registrant’s own actions or the actions of an employee or associate of the licensee or registrant.

[2] As a result of the alleged contraventions, Regulatory Services imposed an administrative sanction of an immediate suspension of the Licensee’s Class-D Retail Liquor Store Licence numbered 781684-1.

[3] The Licensee subsequently applied for a hearing before a Panel of the Board of the AGLC pursuant to section 94(1) of the Act.

[4] In accordance with section 11 of the Act, the Board Chair designated three members of the Board to sit as a Panel to conduct the hearing and make a decision – Vincent Vavrek (Presiding Member), Patti Grier, and Tongjie Zhang.

[5] The parties and the Panel were provided with a record containing various documents pertaining to the issues before the Panel. The Applicant confirmed receipt of the Notice of Hearing dated June 19, 2023 and the attached hearing record. The following documents were entered into evidence: • Exhibit 1 Hearing Record, including Tabs A to C • Exhibit 2 Letter from City of Calgary to Premier Wine Spirits and Liquor

II. Issues [6] Did Premier Wine Spirits and Liquor contravene sections 69(1)(a), 69(1)(c) and 92(1) of the Act? If the Licensee contravened any or all of the above, should the administrative sanction imposed by Regulatory Services suspending the liquor licence be confirmed, replaced, or cancelled?

III.

Regulatory Services Submissions

[7] Regulatory Services called two witnesses to give evidence: AGLC Inspector Dreydon Ward and Senior Manager, Investigations Calvin Wiltshire.

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Inspector Dreydon Ward [8] Inspector Ward has been an Inspector with AGLC for over one year. He completed the Incident Report (Exhibit 1, Tab B) detailing an investigation of Premier Wine Spirits and Liquor that occurred from June 1 to June 6, 2023.

[9] Inspector Ward was advised that on June 1, 2023, the Calgary Police Service (CPS) executed a search warrant for Premier Wine Spirits and Liquor and the convenience store adjacent to it, both owned and operated by Mr. Gurpartap Walia. At the time the search was conducted, neither Mr. Walia nor any other employees were present in the liquor store or the convenience store.

[10] CPS discovered various liquor products in the convenience store as well as tobacco and vape products in the liquor store. CPS advised AGLC of their findings and requested that an Inspector attend the premises to investigate further.

[11] As a result, on June 1, 2023, Inspector Ward arrived at the convenience store at approximately 12:17 p.m. He spoke with the CPS detective on site to gain more information. The detective escorted Inspector Ward through the convenience store where Inspector Ward observed and photographed the following:

• • • • •

97 flats of Mountain Crest beer located near the self-serve cooler at the back of the store (photos attached to Exhibit 1, Tab B, as attachments 1, 2, 3) Various other liquor products (seltzers, coolers, wine) at the back of the cooler (attachments 4, 5, 6, 7) 3 boxes of Dragon Stout beer located on a shelving unit in the retail area of the store (attachments 8 and 9) 1 box of Fortuna Cerveza Artesanal Beer located on a shelving unit adjacent to the front entrance of the store (attachment 10) 1 box of Vodka Mudshake - Strawberry located on a lower shelving unit near the front entrance of the store (attachment 11)

[12] Inspector Ward stated that all of the products appeared to be accessible to customers. He confirmed that the convenience store is not licensed to sell liquor.

[13] Following his inspection of the convenience store, Inspector Ward entered Premier Wine Spirits and Liquor. He spoke with the CPS detective in the liquor store to gain more information. The detective escorted Inspector Ward through the liquor store where Inspector Ward observed and photographed the following:

In the back storage room • 5 flats of cigarettes (photos attached to Exhibit 1, Tab B as attachments 12, 13, 14) • 3 flats of packaged various nicotine vape cartridges and disposable vapes (attachments 15, 16)

Under the sales counter, adjacent to the front entrance • 4 cannabis vape cartridges (attachment 17)

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• • • • •

2 flats of packaged disposable nicotine vapes (attachment 18) Approximately 30 packages of cigarettes (attachment 19) 13 “20 packs” of contraband cigarettes (attachments 20, 21) 10 “25 packs” of contraband cigarettes (attachment 22) A list titled “Smokes” listing various tobacco brands and pricing for each item (attachment 23)

[14] Inspector Ward suggested that it appeared the tobacco products were intended for sale in the liquor store.

[15] Section 4.3.4 of the Retail Liquor Store Handbook lists all of the non-liquor items that a retail liquor store may sell. Inspector Ward asserted that anything not included on the list is prohibited and, specifically, that tobacco, tobacco products, vapes, and/or cannabis products are not listed.

[16] CPS seized the contraband tobacco and cannabis vapes from Premier Wine Spirits and Liquor. Inspector Ward stated that none of the liquor in the convenience store or the legal tobacco in the liquor store was seized by AGLC or by CPS.

[17] On June 2, 2023, several media outlets reported on the CPS investigation and resulting search of the convenience store and liquor store and reported that multiple criminal charges had been laid against Mr. Walia and his son. Two media articles were included as attachments 24 and 25 to the Incident Report.

[18] The media articles detailed the charges, which were later confirmed in the licensed premises check submitted to AGLC by CPS (Exhibit 1, Tab B, attachment 26).

[19] On June 5, 2023, AGLC Inspections Supervisor contacted Mr. Walia and advised him that Regulatory Services would be seeking an immediate suspension of his liquor licence based on the criminal charges filed against him by CPS. Inspector Ward reported that Mr. Walia suggested to the Supervisor that he was unaware of the charges and media reporting on the matter and responded, “please don’t.”

[20] The licensed premises check submitted by CPS to AGLC stated that CPS received information that Mr. Walia and his son were “involved in selling vapes, cigarettes, alcohol and marijuana to children from the convenience store and the Premier Wine Spirits and Liquor store,” among other activities.

[21] Specifically, as a result of the search warrants, Mr. Walia was charged with offences relating to sexual assault, sexual interference with a minor and selling contraband tobacco and his son was charged with several offences, including but not limited to:

• • • •

Sexual interference with a minor Sexual exploitation Sexual assault Possession of, creating and accessing child pornography

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• • • • • •

Unlawful possession of a firearm Possession of a controlled substance for the purpose of trafficking Extortion Uttering threats Selling contraband tobacco to youth Breach of Court order

[22] On June 9, 2023, the Licensee received a notice of administrative sanction, detailing the suspension (Exhibit 1, Tab A).

[23] On July 14, 2023, Inspector Ward attended the licensed premises to confirm that the suspension notice had been posted, as required. Inspector Ward advised the Panel that it had not and that another AGLC Inspector returned to Premier Wine Spirits and Liquor later that evening to post the suspension notice.

[24] Inspector Ward peered inside the convenience store and did not see any liquor. He noted that both the liquor store and the convenience store were unoccupied and closed when he visited on July 14, 2023.

[25] Inspector Ward also observed a notice from the landlord on the entrance to the convenience store. The notice was dated July 7, 2023 and indicated that the tenant had failed to pay rent for the month of July and if payment was not received within 15 days, the landlord would take steps to evict.

[26] On July 25, 2023, Inspector Ward spoke with the landlord. The landlord confirmed that the lease was still active and in effect for Mr. Walia, however, there were negotiations underway for a third party to take over the lease.

[27] Inspector Ward stated that a lease or contract must be in place in order for a Licensee to demonstrate that they have care and control of the premises they are operating and remain eligible to hold a licence.

[28] In July 2023, Inspector Ward also became aware that the City of Calgary had notified Mr. Walia by letter that the business licence for Premier Wine Spirits and Liquor was suspended until court proceedings dealing with the criminal charges have been completed (Exhibit 2). On July 10, 2023, AGLC Inspections Supervisor contacted Mr. Walia to confirm he had received the correspondence and was aware that his business licence had been suspended.

[29] Inspector Ward explained that without a business licence, a Licensee becomes ineligible for a liquor licence and that they cannot operate a retail liquor store licence while the business licence is suspended.

[30] When asked by the Panel whether the liquor store and convenience store are connected, Inspector Ward submitted that they are adjacent to each other in the same strip mall but that there is no door connecting the two and they each have a separate entrance.

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[31] When asked by the Panel whether Regulatory Services conducts training or check ins with the Licensee at the time of licence renewal or throughout the year, Inspector Ward advised that annual maintenance inspections are conducted for Class D-Retail Liquor Store licensees. At theses visits, Inspectors review documentation and operations to ensure Licensees are following proper procedures. However, if Regulatory Services receives a complaint or concern about a particular Licensee, they will follow up and conduct an inspection sooner.

[32] Additionally, all retail liquor stores are subject to AGLC’s Under 25 audit program where AGLC agents conduct surprise visits to ensure compliance with verification of proof of age policies for people who appear to be under the age of 25 years. If a Licensee fails the audit, Regulatory Services offers a staff training seminar to the Licensee which provides a review of AGLC’s policies.

[33] Inspector Ward could not recall when the last maintenance inspection had occurred at Premier Wine Spirits and Liquor.

Investigator Calvin Wiltshire [34] Investigator Wiltshire advised the Panel that, in his role as Senior Manager of Investigations in Calgary, he is responsible for conducting background checks, also known as records checks, when individuals apply for licensing or registration with AGLC. Investigator Wiltshire explained that background records checks are conducted to determine whether potential licensees are likely to operate with honesty and integrity and do not have any criminal history that would cause harm to the public.

[35] Investigator Wiltshire highlighted the criminal charges laid against Mr. Walia that were detailed in the Incident Report, which Investigator Wiltshire stated matched the information obtained from the Justice Online Information Network (JOIN) database. The charges were: • Sexual assault (four counts) • Sexual interference with a minor (four counts) • Sell/transport/deliver/distribute contraband tobacco product (one count)

[36] Investigator Wiltshire submitted that there have been three Court hearings dealing with these matters to date, with another date set in August 2023. However, due to the nature of the proceedings, Investigator Wiltshire advised there is a publication ban in effect so he is unable to access more details about the proceedings or the accusations.

[37] Investigator Wiltshire explained that if Mr. Walia were to apply for a liquor licence today, he would not pass a background check and would not be eligible for licensing. Investigator Wiltshire cited the following reasons: seriousness of the charges laid, recency of the events and where the offences were alleged to have occurred.

[38] Specifically, section 10 of the Gaming, Liquor and Cannabis Regulation suggests that a person would fail to pass a records check if they have been charged with or convicted of an offence that is

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sufficiently serious that it may be detrimental to the orderly or lawful conduct of activities authorized by a liquor licence.

[39] Investigator Wiltshire explained that criminal charges, not just convictions, are considered by his team during background checks because the charges can speak to the integrity of the individual and impact their interactions with the public.

[40] Investigator Wiltshire suggested that the continued operation of Premier Wine Spirits and Liquor would pose a risk to the public and would bring into question the integrity of the Licensee as well as AGLC’s role as a regulator. Investigator Wiltshire submitted that the public has entrusted Regulatory Services of AGLC with confidence that it will be protected against harm. Investigator Wiltshire asserted that this Licensee poses an even higher risk to the community as the conduct was alleged to have occurred in the licensed premises.

[41] When asked by the Panel whether a background check was conducted at the time of licensing, Investigator Wiltshire stated that he could not confirm without a review of the file but that it was very likely a background check was conducted if the regular licensing process was followed. Investigator Wiltshire could not recall when Premier Wine Spirits and Liquor first became licensed.

IV. [42]

Premier Wine Spirits and Liquor Submissions The Applicant, Mr. Walia, gave evidence on behalf of Premier Wine Spirits and Liquor.

[43] Mr. Walia explained that he ordered a surplus of liquor to obtain a discount and in anticipation of increased sales during the Calgary Stampede. As a result, and he ran out of room to store the product in the liquor store. Mr. Walia stated that he was under the impression he could store liquor product in his convenience store if it was sealed.

[44] Mr. Walia questioned why anyone would want to buy unrefrigerated liquor from the convenience store when they could just go next door and purchase refrigerated liquor from the liquor store.

[45] Mr. Walia acknowledged that he now knows it was wrong to store liquor in the unlicensed convenience store and that he made a mistake.

[46] Mr. Walia stated that students from a nearby school often come into his convenience store. He stated that they come in large groups and have previously stolen vapes and other products from his store. He has communicated with the principal of the school and has not pressed charges but has asked the minors to stop coming into his store.

[47] Mr. Walia stated that the minors smoke outside his convenience store but that he has never sold tobacco or liquor to minors. He stated that they use expensive vapes that he does not even sell.

[48] With respect to the tobacco products in the liquor store, Mr. Walia advised the Panel that his convenience store has been robbed twice, once by students, and that tobacco products were stolen. He

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now only purchases a few cartons of cigarettes and tobacco products at a time from other retailers and stores them in Premier Wine Spirits and Liquor to prevent further thefts from the convenience store.

[49] Mr. Walia submitted that the tobacco products cannot be scanned or purchased from the liquor store. He stated that his son, who works in the convenience store, calls him when a customer wishes to purchase tobacco from the convenience store and Mr. Walia brings it over.

[50] Mr. Walia submitted that the cannabis vape products found under the sales counter in Premier Wine Spirits and Liquor belong to his son, for his own personal use. Mr. Walia stated that his son smokes cannabis, not tobacco.

[51] When asked by Regulatory Services why there was contraband tobacco found in the liquor store, Mr. Walia stated that two or three months earlier a man came into the liquor store in need of money and offering to sell cigarettes to Mr. Walia for $3 per pack. Mr. Walia said he bought $50 worth for his son and that he was unaware the cigarettes were contraband.

[52] Further, Mr. Walia explained that the “smokes” list found in the liquor store was to keep track of the price of cigarettes as prices had changed and that the pricing only refers to the legal cigarettes that he sells. He stated that the tobacco products are only intended for sale from the convenience store and are kept in the back storage room and under the front sales counter of the liquor store, where customers cannot see them.

[53] When asked by the Panel how long Mr. Walia had been in business prior to the incident, Mr. Walia advised that the convenience store had been operational for thirteen years and that he obtained his liquor licence almost three years ago. Mr. Walia confirmed that at the time of licensing, a background check was conducted and cleared.

[54] When the liquor store and convenience store were operational, Mr. Walia stated that he, his son and his mother were at the store six to seven days per week. Mr. Walia advised the Panel that he used to have other employees but that they have gone back to school so it was only him and his son working, with Mr. Walia operating the liquor store and his son operating the convenience store.

[55] When asked by the Panel whether Mr. Walia has participated in any training with AGLC, Mr. Walia submitted that he has not but that he follows AGLC’s policies and does whatever he is asked when AGLC Inspectors have conducted inspections in the past.

[56]

Mr. Walia confirmed that both he and his son are ProServe certified.

[57] With respect to the eviction notice, Mr. Walia stated that he gave up the lease and sold the convenience store.

[58] Mr. Walia confirmed that he is waiting for a decision from the City of Calgary regarding his business licence for Premier Wine Spirits and Liquor but currently, it is still suspended.

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[59] Mr. Walia stated that, as a result of the criminal charges and the licence suspensions, he has no money to pay his bills and he is depressed. He advised the Panel that the charges are based on allegations and that he did not do anything wrong.

[60] Mr. Walia advised the Panel, with regard to the court proceedings, that nothing has happened as of the date of the hearing and that disclosure had not been produced.

V. Summation Regulatory Services [61] The matters before the Panel are alleged contraventions of section 69(1)(a), 69(1)(c) and, in turn, section 92(1) of the Act.

[62] Regulatory Services submits that Mr. Walia has not provided any reasoning as to why there was contraband tobacco found under the sales counter in the liquor store nor a valid reason for why liquor was being stored in an unlicensed area.

[63] The evidence provided by Inspector Ward and Investigator Wiltshire is clear; CPS provided information indicating that the Licensee has been charged with numerous, serious offences, some of which are directly related to activities in the licensed premises.

[64] Although Regulatory Services is not privy to all the details of those offences due to a publication ban, Regulatory Services is of the opinion that based on the charges laid, this Licensee is a danger to the community and to permit them to continue to operate would pose a risk to the staff, patrons and community at large.

[65] Regulatory Services takes the position that while the charges are assessed in Court, the liquor licence ought to remain suspended to ensure further offences cannot occur and to ensure an ineligible Licensee does not retain and operate a liquor licence.

[66] Pursuant to section 92(1) of the Act, the board may do any one or more of the things referred to in subsection (2) if, after a licensee or registrant becomes ineligible to hold a licence or to be registered because of either the licensee’s or registrant’s own actions or the actions of an employee or associate of the licensee or registrant. In accordance with section 92(2), if subsection (1) applies, the board may, by order, with or without a hearing, do any one or more of the following:

(a) (b)

cancel or suspend the licence or registration require a person to dispose of an interest in the business under which the activities authorized by the licence or registration are carried out;