ADMINISTRATIVE LAW |
Judicial Review |
MBNA Canada Bank v. Canada (Commissioner, Financial Consumer Agency)
T-492-04
2004 FC 1665, von Finckenstein J.
26/11/04
9 pp.
Judicial review of decision of Commissioner of Financial Consumer Agency of Canada (FCAC)--Applicant wholly owned subsidiary of MBNA America Bank, leading issuer of endorsed MasterCard credit cards and one of world's largest independent credit card lenders--FCAC federal agency established to supervise financial institutions to ensure compliance with consumer provisions in various legislation--Applicant offering credit cards through mail to potential customers with prospect of Regular Annual Interest Rate As Low As (RALA) 9.99% depending upon person's creditworthiness--FCAC approaching applicant to examine compliance with legislation regarding statutory cost of borrowing requirements associated with credit card loans and subsequently conducting more detailed review of applicant's RALA program--FCAC informing applicant RALA program not complying with Cost of Borrowing (Banks) Regulations, s. 11(1) because program failed to disclose actual or regular interest rate at time of credit card application--Notice of violation sent and applicant invited to make representations regarding alleged violation--Commissioner attaching reasons for decision to notice of violation sent to applicant--Financial Consumer Agency of Canada Act (FCACA), s. 22(3) requiring that Commissioner first propose penalty in notice of violation and consider representations before deciding on balance of probabilities whether violation occurred--Reference in Commissioner's reasons to "alleged contravention" and proposal of $75,000 penalty not detracting from fact document amounting to preliminary decision--Commissioner not following FCAC procedure since MBNA not given fair hearing but right of appeal of decision already made-- Commissioner breaching rules of natural justice by failing to consider applicant's representations and subsequently deciding with unbiased mind whether penalty to be imposed and amount thereof--Application allowed--Cost of Borrowing (Banks) Regulations, SOR/2001-101, s. 11(1)-- Financial Consumer Agency of Canada Act, S.C. 2001, c. 9, s. 22(3).