[OFFICIAL ENGLISH TRANSLATION]
2000-3084(EI)
BETWEEN:
PIERRE VÉZINA,
Appellant,
and
THE MINISTER OF NATIONAL REVENUE,
Respondent.
Appeal heard on May 29, 2001, at Montréal, Quebec, by
the Honourable Deputy Judge J.F. Somers
Appearances
Counsel for the Appellant: François De Vette
Counsel for the Respondent: Marie-Aimée Cantin
JUDGMENT
The appeal is dismissed and the Minister's decision is confirmed in accordance with the attached Reasons for Judgment.
Signed at Ottawa, Canada, this 21st day of August 2001.
|
"J.F. Somers" |
D.J.T.C.C.
Translation certified true
on this 13th day of March 2003.
Sophie Debbané, Revisor
[OFFICIAL ENGLISH TRANSLATION]
Date: 20010821
Docket: 2000-3084(EI)
BETWEEN:
PIERRE VÉZINA,
Appellant,
and
THE MINISTER OF NATIONAL REVENUE,
Respondent.
REASONS FOR JUDGMENT
Somers, D.J.T.C.C.
[1] This appeal was heard at Montréal, Quebec, on May 29, 2001.
[2] In a letter dated May 16, 2000, the Minister of National Revenue (the "Minister") informed the appellant of his decision according to which his alleged employment with 2641-8160 Québec Inc., the payer, for the period from September 6, 1991, to February 14, 1992, was not insurable because it did not meet the requirements of a contract of service.
[3] Subparagraph 5(1) of the Employment Insurance Act reads in part as follows:
5. (1) Subject to subsection (2), insurable employment is
(a) employment in Canada by one or more employers, under any express or implied contract of service or apprenticeship, written or oral, whether the earnings of the employed person are received from the employer or some other person and whether the earnings are calculated by time or by the piece, or partly by time and partly by the piece, or otherwise;
...
[4] The burden of proof is on the appellant. He has to show on the balance of evidence that the Minister's decision is unfounded in fact and in law. Each case stands on its own merits.
[5] In making his decision, the Minister relied on the following facts, which the appellant admitted, denied or had no knowledge of:
[TRANSLATION]
(a) The payer carried on a home renovation business from 1990 to 1992. (admitted)
(b) Pierre Chaîné was the sole shareholder of the payer. (no knowledge)
(c) On September 30, 1992, Pierre Chaîné declared personal bankruptcy; the payer did not declare bankruptcy but has been inactive since that date. (no knowledge)
(d) The payer carried on its business in the Shawinigan and Grand-Mère area. (no knowledge)
(e) The appellant claims that he worked for the payer during the period at issue, although in fact he rendered no services to the payer. (denied)
(f) The appellant claims that he worked for the payer through Robert Dion, a project manager for a Longueuil home renovation firm, which allegedly did business with the payer in 1991 and 1992, whereas the payer conducted its business in the Mauricie region. (denied)
(g) The appellant claims that he only did renovations whereas Mr. Chaîné claims that the appellant devoted between 75% and 80% of his time to seeking contracts for the payer. (denied)
(h) All the documents concerning Mr. Chaîné's personal bankruptcy and the payer's company were destroyed by the trustee in bankruptcy. (no knowledge)
(i) The appellant no longer remembers any details concerning the work that he allegedly did for the payer during the periods at issue. (denied)
(j) The appellant does not remember any client, any place where he worked or any particular event concerning his alleged work for the payer during the period at issue. (denied)
(k) The appellant claims that he was paid in cash during this period, whereas he reported no employment income on his 1992 tax return. (denied)
[6] The appellant was the only one who testified in support of his claims.
[7] The appellant asserted that Robert Dion asked him whether he wanted to work in home renovation. Robert Dion allegedly told him that he was the manager of Pierre Chaîné, the sole shareholder of the payer.
[8] The appellant said that he had experience in renovating private residences. He said he worked on Montréal's South Shore for a year or a year and a half, between 37 and 42 hours a week, and received a weekly salary of $700, paid in cash every Friday or Saturday.
[9] The appellant filed in evidence a record of employment (Exhibit A-1), indicating that the period of employment was from September 6, 1991, to February 14, 1992. The record of employment was signed by Pierre Chaîné. This document states the name of Pierre Dumont as a reference. The appellant admits that he completed his 1991 tax return and received a T4 for that year.
[10] He asserted that he was informed by Jean-Claude Roy, an appeals officer with the Canada Customs and Revenue Agency, that there had been fraud in the payer's operations.
[11] On cross-examination, he stated that he did not remember the names of the clients or the places where he supposedly worked during the period at issue. He admitted that he was a self-employed worker prior to the period at issue.
[12] The appellant admitted the contents of Exhibit I-1, a decision of the board of referees dated November 22, 1999, reconsidering its decision dated August 24, 1999. In the board of referees' decision, it was noted that the Commission found that the T4 [TRANSLATION] "was falsified since Revenue Canada states ... that for the 1991 taxation year, this employer issued only two T4s neither of which was for Pierre Vézina .... Moreover, Revenue Canada states ... that the company that issued the record of employment had reported no income or activity since March 1991..."
[13] The evidence consists of the testimony of Laval Rhainds, a former investigator with Human Resources Development Canada, concerning the claims for unemployment/employment insurance benefits, and testimony of Jean-Claude Roy, the appeals officer.
[14] In his investigation, Laval Rhainds obtained statements from three people who claimed unemployment insurance benefits in 1992 and 1993. The Minister wanted to produce in evidence the statements obtained from these three people in April 1997, but counsel for the appellant objected to their being produced, stating that it was hearsay. The Court took these objections under reserve.
[15] Counsel for the Minister claimed that the statements could be introduced in evidence, since the Minister is required to put before the Court the facts on which he based his decision. Counsel for the Minister relied on the decision of the Honourable Judge Garon (as he then was) of this Court in Duquette et al. v. The Queen, 93 DTC 846. In that case, Judge Garon referred to the decision in Johnston v. M.N.R., 3 DTC 1182, in which former Chief Justice Cardin of this Court allowed hearsay evidence.
[16] Judge Garon, relying on the Johnston decision, supra, expressed himself as follows:
I see no merit in this objection of the Appellant. This judgment clearly indicates that the Minister may rely on statements by third parties and on the report of a commission of inquiry and take for granted that what it advances is true. The onus is on the Appellant to demolish those presumptions.
[17] In light of this case law, I overrule the appellant's objection and therefore allow these statements to be filed in evidence. Counsel objected to filing the records of employment of the three persons and the report of Jean-Claude Roy, the appeals officer. These objections are overruled for the reasons cited above.
[18] These three persons admitted that the records of employment were false and that they had never worked for 2540-4864 Québec Inc. or 2440-8627 Québec Inc. in 1991, 1992 and 1993. In two of the three records of employment, the name of Pierre Dumont is indicated as the person to contact for more information. These individuals allegedly paid amounts of $2,000 and $3,000 to obtain the false records of employment.
[19] Jean-Claude Roy, the appeals officer, stated that he had had telephone conversations with Pierre Chaîné on January 10 and 25, 2000, and that he had met with him on February 2, 2000.
[20] Pierre Chaîné allegedly told him that he was the sole shareholder of 2641-8160 Québec Inc., that the company had been in operation from 1990 to 1992 and that he had two to three employees. He allegedly told him that Pierre Vézina was one of his employees and that his duties primarily consisted of seeking contracts and, occasionally, doing some renovation work. Between 75% and 80% of Pierre Vézina's work consisted of finding contracts.
[21] At the meeting of February 2, 2000, Pierre Chaîné allegedly told Jean-Claude Roy that Robert Dion, Michel Dumont and Pierre Vézina were people involved in home renovation in the Longueuil area. The activities of Pierre Chaîné, his wife and his son were limited to the Shawinigan and Grand-Mère area during the period at issue. He said he was put in contact with Robert Dion, Michel Dumont and Pierre Vézina through the accountant, Pierre Dumont, the brother of Michel Dumont.
[22] Pierre Chaîné stated that the group of workers from Longueuil managed their projects by themselves, invoiced their clients and paid their own salaries in cash.
[23] Pierre Chaîné stated that he was "tricked" by the Longueuil group and by Pierre Dumont. The debts left by the Longueuil group allegedly caused the bankruptcy of Pierre Chaîné's business.
[24] In his report after his meeting with Pierre Chaîné (Exhibit I-3), Jean-Claude Roy wrote the following:
[TRANSLATION]
· He [Pierre Chaîné] has no personal knowledge of any of the work supposedly done by the Longueuil group.
· There is no evidence of the work allegedly performed by the Longueuil group.
· There was no advertising in the newspapers or otherwise.
· Pierre Chaîné completely relied on the Longueuil group to manage and carry out the work.
· No client of the Longueuil group apparently contacted Pierre Chaîné.
· The Longueuil group apparently provided their own invoice forms (and not the invoices of Pierre Chaîné's business). Pierre Chaîné was the only one to have a stamp to identify the invoices with the name of his business.
· The Longueuil group apparently provided its own tools and vehicles.
· Pierre Chaîné's firm was supposed to enter into a partnership with the Longueuil group after the trial period, but this did not happen.
· Pierre Chaîné exercised no control over the Longueuil group.
· It was at Pierre Dumont's request that Pierre Chaîné signed the records of employment for the Longueuil group members.
[25] At a meeting with Pierre Vézina and his lawyer on March 14, 2000, Jean-Claude Roy obtained some information from the appellant.
[26] The appellant told Mr. Roy that he had always been the sole shareholder of 147432 Canada Inc. and that this was a management company. He no longer remembered the kind of activity carried on by that company or the number of hours that he devoted to it in 1991 and 1992.
[27] He admitted that he had previously worked in construction as a self-employed worker. Pierre Vézina confirmed that the period at issue, namely, from September 6, 1991, to February 14, 1992, was accurate.
[28] The appellant stated that he was hired and laid off by Robert Dion, Pierre Chaîné's manager. He admitted that he did not have a competency card for the construction trades.
[29] The appellant apparently received a fixed salary every week and was paid in cash by Robert Dion. He had no evidence of the remuneration he said he received.
[30] He did not remember any of the clients or places where he supposedly worked during the period at issue. He did not remember any anecdotes or special events relating to the work. He was told verbally about the work to be done. He did not remember the other workers involved in the work. He thought that the accountant, Pierre Dumont, that is, Michel Dumont's brother, might have worked. He apparently worked alone or with another worker depending on the kind of work to be done.
[31] According to the employers' service of the Ottawa Technology Centre, there was no registration for the T4 slips that had apparently been produced in 1991 by 2641-8160 Québec Inc. There were three T4 slips registered for 1992 concerning two individuals (Exhibit I-3):
(1) P. Chaîné (original), earnings of $9,750
(2) P. Chaîné (amended), earnings of $9,750
(3) F. Desaulniers (original), earnings of $2,765.
[32] On January 28, 2000, Pierre Dumont apparently told the investigator that he had filed T4 slips for the payer's 1991 and 1992 taxation years and that he had mailed the whole thing to Revenue Canada, and this contradicts the information received from the employers' service of the Ottawa Technology Centre.
[33] On February 3, 2000, Pierre Dumont stated that (Exhibit I-3):
[TRANSLATION]
- he had no document concerning Pierre Chaîné's corporation;
- he was the one who introduced the Longueuil group to Pierre Chaîné;
- he had prepared the financial statements and tax returns for Pierre Chaîné's company;
- it was Robert Dion who managed the payer's paperwork and money for the Longueuil sector;
- he did not know whether the Longueuil group invoiced under the name of 2641-8160 Québec Inc. or under their own name.
[34] On February 22, 2000, Pierre Dumont told the investigator that he could not confirm that the revenues from the Longueuil group were incorporated into the revenues from Pierre Chaîné's company.
[35] The investigator, Jean-Claude Roy, said he received the following information from Robert Dion (Exhibit I-3):
[TRANSLATION]
Robert Dion told me the following over the telephone on February 1, 2000:
- he was the site manager for Pierre Chaîné;
- the activity was home renovations; the job sites were small; there were 3 or 4 contracts a week;
- there were subcontractors and employees to do the work;
- he knew Pierre Vézina but had not worked with him; he did not remember much about his work;
- he did not remember the other workers;
- he did not remember any particular event occurring during the period at issue;
- it was Pierre Chaîné who found the contracts, who told him where to go and what to do.
At a meeting in the office on February 28, 2000, Robert Dion told me the following:
- before the period at issue, he had worked for himself on the South Shore;
- during the period at issue, Pierre Chaîné came in very rarely and relied on him and the clients called him directly (N.B.: on 2/1/200 [sic], he said that Pierre Chaîné found the contracts, told him where to go and what to do);
- Robert Dion invoiced the clients orally; there were no invoices; it was he who collected the amounts from the clients; the clients paid only in cash (no cheques);
- salaries were all paid in cash;
- Robert Dion gave the orders to Pierre Vézina for the work to be done (however, Robert Dion did not know why Pierre Vézina apparently finished one week after him).
[36] In view of the assumptions of fact alleged by the Minister, the onus was on the appellant to rebut those assumptions.
[37] The appellant did not provide any evidence that he had rendered services to the payer during the period at issue. He did not remember any clients or the places where he had rendered any services. He did not remember any anecdote that he could link with the period at issue.
[38] Pierre Chaîné and Robert Dion have no recollection of the clients or the places where services might have been rendered.
[39] Pierre Chaîné stated that the appellant looked for contracts (75% to 80% of his work) and was paid a percentage depending on the contracts obtained, whereas the appellant said that he received $700 per week doing labour; the record of employment produced in evidence as Exhibit A-1 indicates "labourer". The appellant has no competency card to justify this salary.
[40] The appellant told the investigator that he had been hired and laid off by Robert Dion, whereas Robert Dion ended his employment one week before the appellant did. The appellant received orders from Robert Dion but Robert Dion did not work during the last week.
[41] According to Robert Dion, no invoices were issued to the alleged clients, and they had all paid in cash and had never paid by cheque, which is unlikely.
[42] Considering all of the circumstances of the instant case, namely, the inconsistencies in the information obtained by the investigator from the people questioned in meetings in January and February 2000, there could not be a genuine contract of service. The statements to the investigator by those people and the appellant in particular were not contradicted.
[43] The appellant based his appeal solely on the testimony he gave to the Court. Merely making assertions is insufficient in the circumstances to establish that there was a contract of service between him and the payer.
[44] The appeal is dismissed.
Signed at Ottawa, Canada, this 21st day of August 2001.
|
"J.F. Somers" |
D.J.T.C.C.
Translation certified true
on this 13th day of March 2003.
Sophie Debbané, Revisor
Case Law Consulted
Elia v. Canada (Minister of National Revenue - M.N.R.), [1998] F.C.J. No 316
Andrée Carpentier and M.N.R. and Les Cimentiers R.G. Inc., 94-1387(UI)
Duquette et al. v. The Queen, 93 DTC 841
Paolo Violi v. M.N.R., 77-731 (Tax Review Board)
Patrie c. Canada (ministre du Revenu national - M.R.N.), [1995] A.C.I. no 1589
Audet c. Canada (ministre du Revenu national - M.R.N.), [1998] A.C.I. no 913
Hervé St-Amand and M.N.R., 92-972(UI)
Robert Dion and M.N.R., 97-2056(UI)