Thursday, October 16, 2014

Do I Need a Lawyer to Fight an Administrative Monetary Penalty (AMP)? And What Exactly is this AMP Thing that I Received?

Source: Reproduced in Evaluation of Administrative Monetary Penalties (Canadian Food Inspection Agency, 2012)
Administrative Monetary Penalties (AMPs) have been around for a long time, though they used to simply be called civil penalties. I've been unsuccessful in my efforts to find out who invented the term, but in the Canadian context it seems that it was the Canada Border Services Agency that first popularized the term to refer to monetary sanctions imposed for violating government regulations (anything from not declaring that Hungarian salami that was just too tempting to leave behind on your last visit to Budapest, to misclassifying your industrial importation of softwood lumber).

The reason they're AMPs or civil (and not criminal) penalties, is that they don't arise from conviction after prosecution - that would be a true "fine" in the classic sense - but also unfortunately don't carry with them the same guarantees of procedural fairness implicit in a prosecution, like the right to an oral hearing or (sometimes) the right to raise due diligence as a defence.

The reason you should care about AMPs, and consider hiring a lawyer to defend yourself against a Notice of Violation (the term usually applied to the document specifying the AMP), is that their value is headed dramatically upwards and there may be other difficult to understand consequences for you in the future if you're subject to an AMP. I'm not suggesting a lawyer is needed in all cases, but for business AMPS can sometimes now run into the hundreds of thousands of dollars range, and potentially affecting future licensing to operate the business.

Don't get too hung up on the term AMP. The Canada Revenue Agency has long standing policies imposing hefty civil penalties on individuals and corporations who don't file their taxes on time, or misreport their taxable income, but still doesn't use the AMP term. Municipalities from shortly after the invention of the automobile have been imposing penalties on street parking violations, but have only recently adopted the term AMP, it seems in an effort to move parking ticket disputes out of court and onto a desk where those disputing a ticket can make only written rather than oral submissions.

I'm not suggesting that civil penalties are "bad" per se, since for many people it's better to receive a civil penalty rather than a prosecution for a regulatory transgression. There's supposedly less stigma attached to a civil penalty, but the thing to watch out for is that there isn't necessary a lower monetary value to an AMP (in fact, it's often much higher than a criminal monetary penalty), and there could be other licencing or future freedom of action consequences for you or your business.

You need to understand that all agencies who seek to impose AMPs have set up systems permitting you to contest the AMP. However, you also need to understand that these systems are nothing like traffic court where you get your "day in court" to show up many months later and orally plead your case to the judge or justice. Instead, to contest an AMP you may be expected to produce precise written submissions including documentary evidence within a very short timeframe to a faceless decision maker in a government office. You certainly could do this without a lawyer's help, but you need to carefully consider if you wish to invest the time and effort personally (or as a business) in doing so, and whether your background skill set lends itself to making persuasive submissions based on legal and government policy principles.

Aside from contesting the violation itself, you should know that you might have a greater chance of success in just contesting the amount. Unlike traffic or parking offences which often work on a fixed monetary amount, or criminal fines which have a great discretionary range left to the trial judge, the monetary value of an AMP may often be determined by a complex points formula involving a base rate that is adjusted up or down through the addition of point values (such as on a scale of one to five) and weightings (like 30% for points connected to past violations). Thus while the agency will initially determine the AMP amount based on its calculation of the points, that doesn't mean that the calculation is necessarily correct - you can do your own calculations, and make submissions on why the agency was incorrect in its calculation, but make sure you take the time to study the system before you make any submissions.  There is no commonality to AMPS monetary quantum points systems, they vary by agency to agency.

The contesting an AMP process often involves first asking for a review of the AMP by the enforcement body which issued the AMP to you (usually another, higher ranking officer than the one who issued you the AMP in the first place). If you don't like the result of that review, your case can then often proceed to a three member panel who is still affiliated with the agency imposing the AMP, but who will be more independent than the first level reviewers. If you still don't like the result, you can usually further appeal to a competent court - which court you go to will depend on under which Act you were imposed the AMP.

The short answer to the question of whether you need a lawyer to fight an AMP will probably depend on the amount of the AMP, whether or not you believe it was justly imposed, and the true value (financial/moral/licensing) to you of having the AMP overturned. If you do retain a lawyer to contest your AMP, make sure you verify the experience of the lawyer in that specialized field.


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