Background:

• Neighbour’s Drug Mart Ltd. appealed the Divisional Court's decision to dismiss its application for judicial review.
• The original decision terminated Neighbour’s Health Network System Agreement, revoked its billing privileges under the Ontario Drug Benefit Act (ODBA), and suspended its entitlement to receive payments.

Key Points:

• Issues on Appeal:
  1. Whether the Divisional Court erred in applying the reasonableness standard in their review.
  2. Whether the Executive Officer misapprehended the record concerning the previous owner’s role in billing issues.
  3. Whether the revocation was unsupported by the regulatory regime or the Operator’s Agreement.
  4. Whether the decision created an absolute liability for pharmacy owners.
• Court's Analysis and Decision:
  • The Court found no misapprehension by the Executive Officer or Divisional Court. The regulatory scheme relies on an honour system and the corporate operator’s duty to ensure compliance.
  • The Executive Officer appropriately considered the change in ownership and ongoing billing issues, rejecting attempts to shift responsibility.
  • Revocation of the Operator’s Agreement was reasonable given the significant period of non-compliance.
  • The provisions of the Operator’s Agreement did not preclude revocation, as new ownership assumed all rights and liabilities, including those from previous non-compliance.

Conclusion:

• The Court of Appeal dismissed Neighbour’s Drug Mart’s appeal.
• Costs of $8,750 were awarded to the respondent, Ontario.