DARTMOUTH – The Darkside Café in Dartmouth has pleaded guilty to charges of violating municipal zoning by-laws with their business in a deal that will see other charges eventually dropped against the co-owners personally, a day after it closed its doors for good.

Owners Oliver Mahon and his wife Meghan Hirons Mahon were charged in connection with the business operating primarily as a Café instead of an art store back in January, as originally outlined in zoning permits, and were served a non-compliance order about a month after they opened in Oct. 2014. that they said indicated they were selling more coffee than art so changes were needed.

Mahon and lawyers for HRM appeared in court Thursday and both confirmed the deal with prosecution in which Darkside Café Inc. pleaded guilty to violating zoning bylaws as an entity and agreed to pay a still undetermined fine.

Sentencing is scheduled to take place for the business in January and the fine, Mahon said, is expected to be much smaller than the $47,000 plus in backdated zoning fines the business faced when it was first taken to court on charges.

In exchange, the same charges against the pair as directors of the business will be eventually dropped, avoiding a personal fine, as those charges have been stayed pending the submission of financial statements.

Wednesday was the Cafe’s last day of operation, as Mahon said the decision for the prosecution to charge both the entity and owners separately amounted to railroading and led to legal costs that were ultimately too much, coupled with the costs to secure proper zoning.

He said it’s not standard practice for owners to be held personally liable on top of the business, so feels it was “leverage” to overpower the small business owner into compliance.

“That’s one reason why they pay money to become incorporated,” Mahon said, adding the only safety net the business has is its “limited liability.”

“How does that make us different to any other business in the world, where directors and shareholders are protected,” he said.

Mounting a defence on both charges costs money, he said, cash the Municipality knows he doesn’t have, accusing HRM of also knowing the charges against them personally would never stick in court as operators.

“You’re kinda squeezed,” he said, adding even if the zoning ruling was thrown out in court, it costs money to defend it and they would have to go through the development process again, a process that costs time and money, with no guarantees.

“I have to go through all this to defend the company, defend myself, for my wife to defend herself, and then if you win you might have to go through all the process again,” he said, adding the process can take anywhere from 18-24 months.

“We’ve done this for two years now and we can’t do that anymore, we’re out of money.”

HRM had earlier said the owners appeared unwilling to get the zoning changed with a development agreement process not initiated, the first step for potential changes, but Mahon accused the city of attempting him to get the process started on unsavoury terms.

“They said come down open a file and put in money and I said I need the approval of the landlord,” he said, adding the response was for him to “in good faith,” start the process and then try to get the landlord “on board.”

“It’s actually illegal for me to start a development agreement process without approval of the landlord when I don’t own the property,” he said. “You’re asking me to do something that is illegal to make our situation at the store more legitimate.”

“I was completely baffled.”

In response, HRM spokesperson Tiffany Chase said The Municipality has continually tried to work with the owners since they were found in contravention of the zoning by-law because they were operating as a coffee shop, not an art gallery, and were advertised as such on signage.

“The issue with that is that cafe’s and restaurants are not permitted on this property, that’s under the land use by-law regulations,” Chase said, adding they’ve worked with the owners for months to work on bringing them into compliance.

“We were supportive of that, provided them with that information and unfortunately they chose to continue to operate without initiating a development agreement process.”

Ultimately, Chase said, HRM could have shut them down long ago for being non-compliant, but worked with them, as even if they go through the development agreement process, the City doesn’t have the authority to allow them to operate before they get the required permits.

She also said it’s standard practice to charge both the individual and the entity, as issues have arisen surrounding who is on the lease, so it is usually sorted out later in court, as in this case.

She couldn’t comment further on the ongoing court case.

Chase said as a gesture of good will, the business was offered to put up the money for a development agreement to show they were serious about gaining compliance without the landlord’s consent, but it was never going to proceed further without the landlord’s permission.

“That is allowed,” she said, as there was no intention to continue without the landlord being notified, but rather an attempt to speed it up on behalf of the business.

HRM received a new development agreement from the business last week, the first one since it was charged, which is now being looked at despite the business being closed as Chase said it’s up to the owner to rescind the request.

The case is expected to return to court for sentencing Jan. 6. 2017.