Executive Summary: Key Legal and Evidentiary Issues

• Trevor Franklin's application for life and accident/sickness insurance agent licenses was denied by the Life Insurance Council (LIC) based on his criminal history and alleged lack of candour during the application process.

• LIC erroneously conflated a 2020 conditional discharge for criminal harassment with a criminal conviction under s 5(1)(d) of the Insurance Agents and Adjusters Regulation (IAAR), despite the Criminal Code explicitly deeming a conditional discharge not to be a conviction.

• The Insurance Councils Appeal Board dismissed Franklin's appeal on trustworthiness grounds under s 5(1)(c) of the IAAR, but relied on irrelevant considerations including his demeanour as a self-represented litigant and an acquitted dangerous driving charge.

• Appeal Board failed to appreciate the legal significance of a conditional discharge, which is only available where the sentencing court is satisfied that granting it is not contrary to the public interest.

• Consideration of the Appellant's confrontational conduct, allegations of racial bias against the panel, and failure to explain an acquitted charge were deemed irrelevant to the trustworthiness assessment in a professional regulatory context.

• The Court of King's Bench found extricable errors of law and remitted the matter to a newly constituted Appeal Board panel for redetermination.

The facts of the case

Trevor Franklin applied in July 2024 for certificates of authority to act as a life insurance agent and accident and sickness insurance agent in Alberta under the Insurance Act, RSA 2000, c I-3. His application was submitted to the Alberta Insurance Council (AIC), which provided administrative support to the Life Insurance Council (LIC), the body holding delegated authority of the Minister to decide whether to issue the certificates. Franklin had a prior criminal history: a 1993 conviction for assault with a weapon, which included a five-year weapons prohibition, and a 2019 finding of guilt for criminal harassment arising from incidents in the summer of 2018, for which he received a conditional discharge in December 2020. The sentencing court also imposed a weapons prohibition order — 10 years for certain firearms and devices, and a lifetime ban for prohibited and restricted firearms — due to a factual finding that there was an implicit threat to use violence in the harassment behaviour.

The application process and disclosure issues

On the standard application form, Franklin disclosed his 1993 assault conviction and attached a police search disclosing that conviction and the 2020 weapons prohibition order. However, the form and search result did not include mention of the conditional discharge or the criminal harassment finding. When AIC inquired about the 2020 prohibition order, Franklin initially stated he believed it related to the 1993 conviction and later said he did not know why the second entry in the police check referenced a lifelong prohibition. It was not until September 3, 2024 — after AIC formally demanded records under s 467(4) of the Insurance Act — that Franklin disclosed the 2018 criminal charges, the finding of guilt, the conditional discharge, and the associated weapons prohibition. He explained that he had not understood the connection between the prohibition and the conditional discharge until he consulted his former defence counsel.

The regulatory requirements at issue

The licensing requirements under s 5(1) of the Insurance Agents and Adjusters Regulation (IAAR), Alta Reg 122/2001, required among other things that an applicant be "trustworthy" under s 5(1)(c) and must "not have been convicted of any offence the nature of which, in the opinion of the Minister, would render the individual unfit to receive a certificate of authority" under s 5(1)(d). A critical legal question arose as to whether a conditional discharge — which is deemed not to be a conviction under s 730(3) of the Criminal Code — could be treated as a "conviction" within the meaning of the IAAR. Notably, s 5(1)(d) was amended well after the Appeal Board's decision to replace "not have been convicted" with "not have been found guilty."

LIC's decision and the Appeal Board hearing

LIC denied Franklin's application on October 17, 2024, finding he did not meet the requirements of s 5(1)(d) because he had two past convictions — conflating the conditional discharge with a conviction — and did not meet the trustworthiness requirement of s 5(1)(c) because he had a history in the criminal justice system and did not candidly disclose all of it to AIC in the early stages of the application process. Franklin appealed to the Insurance Councils Appeal Board, which convened an oral hearing on April 2, 2025. In its written reasons dated May 2, 2025, the Appeal Board dismissed the appeal. It focused solely on the trustworthiness requirement under s 5(1)(c) without explicitly addressing s 5(1)(d). In its reasons, the Board characterized Franklin as "less than forthcoming," described him as "likely ungovernable," found him "without remorse" for the criminal harassment, and noted his confrontational manner during the appeal, including allegations of racial bias against panel members.

The appeal to the Court of King's Bench

Franklin appealed to the Court of King's Bench of Alberta, arguing the Appeal Board committed errors of law by conflating the conditional discharge with a conviction and by relying on irrelevant considerations in its trustworthiness assessment. The appeal was limited to questions of law or jurisdiction under s 26 of the Insurance Councils Regulation. Justice Eamon applied the correctness standard of review for questions of law and accepted that considering irrelevant evidence or criteria, or failing to consider relevant evidence or criteria, constitutes reviewable errors of law.

The Court's analysis of the conviction issue

The Court held that a conditional discharge under s 730 of the Criminal Code is not a "conviction" under the IAAR. Justice Eamon reasoned that although the IAAR should be broadly construed, it would strain the meaning of "convicted" beyond what is reasonable to include a court's finding which is deemed under the legislation governing sentencing for the offence not to be a conviction and is based on different sentencing considerations. Conditional discharges are reserved for cases where it would not be contrary to the public interest to grant one and are not granted as a matter of routine. While the Appeal Board did not directly apply s 5(1)(d), the Court found the Board still committed an error by effectively equating the conditional discharge with a conviction in its trustworthiness analysis under s 5(1)(c).

The Court's analysis of trustworthiness and irrelevant considerations

Justice Eamon acknowledged that "trustworthy" carries a wide meaning in the regulatory context, encompassing dependability, reliability, and worthiness of confidence beyond mere honesty. However, even in its widest sense, the standard has boundaries: there must be a sufficient nexus between the conduct of concern and the industry or profession, and the assessment must be based in evidence not speculation. The Court found the Appeal Board committed several errors of law. It failed to define or properly apply contextual limits on the trustworthiness concept, did not consider the significance of the conditional discharge or the sentencing court's public interest finding, and considered irrelevant considerations. Specifically, the Board improperly relied on Franklin's confrontational manner and allegations of racial bias as a self-represented litigant without contextually relating them to professional trustworthiness, and drew an adverse inference from his failure to explain a dangerous driving charge of which he had been acquitted — a matter on which he was presumed innocent.

The ruling and outcome

Justice Eamon allowed Franklin's appeal and set aside the Appeal Board's decision. The Court rejected LIC's argument that the errors were inconsequential, finding that the decisions whether to admit candidates into, or remove members from, a profession are among the most difficult and fact-sensitive decisions of professional regulatory tribunals, and the Court was not satisfied that the Board's decision necessarily would have been the same notwithstanding the errors of law. The matter was remitted to a newly constituted panel of the Appeal Board for redetermination. No specific monetary amount was ordered or awarded, as this case concerned the denial of professional licensing rather than a damages claim. The parties were given the opportunity to address costs through brief written submissions.