Cholodniuk v. R., 92 DTC 6168, [1992] 2 CTC 150 (Sask. C.A.)

Sherstobitoff, J.A.:—This appeal concerns the constitutional validity of subsection 244(7) of the Income Tax Act, R.S.C. 1952, c. 148 (am. S.C. 1970-71-72, c. 63) (the"Act"), which provides as follows:

244.(7) Where, by this Act or a regulation, a person is required to make a return, statement, answer or certificate, an affidavit of an officer of the Department of National Revenue, sworn before the commissioner or other person authorized to take affidavits, setting out that he has charge of the appropriate records and that after a careful examination and search of the records he has been unable to find in a given case that the return, statement, answer or certificate, as the case may be, has been made by such person, shall be received as prima facie evidence that in such case that person did not make the return, statement, answer or certificate, as the case may be.

The appellant says that the section denies him the right to cross-examine the deponent and thereby denies him the right to procedural fairness and the right to make full answer and defence guaranteed by section 7 of the Charter of Rights and Freedoms. He also says that it denies him the presumption of innocence guaranteed by subsection 11(d) of the Charter.

For the purpose of this appeal, we accept the facts as stated by the appellant in his factum:

The appellant was charged on an information containing two counts that he did on the 8th day of February, A.D. 1990, unlawfully fail to comply with a notice personally served on him on the 27th day of November, A.D. 1989, made pursuant to Section 231.2(1)(a) of the Income Tax Act in that he did not provide the Minister of National Revenue an individual tax return for the taxation years 1987 and 1988 contrary to section 238(1) of the Income Tax Act.

The trial of the action commenced on December 3, 1990 against the Appellant, Robert Cholodniuk. The Crown chose only to file affidavit material, and eight affidavits were filed at the trial. The evidence in relation to Count #1 was an affidavit of Gordon Mack dated April 23, 1990, in which the letter constituting the alleged notice under Section 231.2(10(a) of the Income Tax Act was attached as an exhibit to an Affidavit of Service. A further affidavit of Gordon Mack, dated April 5, 1990, where he allegedly deposes to the fact that he was in charge of the records for Revenue Canada in Saskatoon and by“ careful examination and search” of the same, he was unable to find a completed and signed Tax Return for 1987. A further affidavit of Linda Nemeth was filed where she claimed to be the director of records in Winnipeg and the contents of her affidavit was exactly in the same format of that allegedly deposed to by Gordon Mack.

The Crown then proceeded to file a series of four affidavits, similar to those filed for Count #1, to prove Count #2 in relation to the 1988 Tax Return.

The respondent Crown did not call any viva voce evidence. The Appellant raised an objection, after the Crown closed its case, that he did not have an opportunity to cross-examine the deponents named in the Affidavits. The learned trial judge, His Honour Judge Gosselin, found he had discretion to order the attendance of the affiants in court for the purposes of cross-examination. However, in the present case the learned trial judge would not exercise his discretion.

His Honour Judge Gosselin found the Appellant guilty of both counts under section 238 of the Income Tax Act. The appellant appealed this decision of [sic] the Court of Queen's Bench where Mr. Justice Baynton dismissed the appeal. The Appellant now brings an appeal to this Honourable Court of that decision.

As to the first issue, the appellant's case depends on whether or not any right to cross-examine the maker of an affidavit tendered or admitted into evidence under subsection 244(7) exists. There are two judgments which say that there is no right to cross-examine, but that an accused may call the deponent as his own witness if he wishes to challenge the content of the affidavit, and that accordingly, there was no violation of the right to make full answer and defence: The Queen v. Maltese (1978), 85 D.L.R. (3d) 149, 40 C.C.C. (2d) 296 (Ont. H.C.J.) and The Queen v. Howe (1978), 24 N.B.R. (2d) 217, 45 C.C.C. (2d) 129 (N.B.S.C.A.D.). These are pre-Charter judgments, although the first judgment considered the issue in light of subsection 2(f) of the Canadian Bill of Rights, the equivalent of s. 11(d) of the Charter, and the relevant statements in the second judgment were obiter dictum. We do not agree with the judgments to the extent that they preclude any right to cross- examine on affidavits admitted as evidence under subsection 244(7).

At common law, a trial judge has not only the right, but the duty to control the evidence so as to ensure a fair trial, even where the admissibility of the evidence is governed by statute. For example, in The Queen v. Corbett, [1988] 1 S.C.R. 670, 41 C.C.C. (3d) 385, the Supreme Court of Canada, in dealing with section 12 of the Canada Evidence Act, R.S.C. 1970, c. E-10 which permits cross-examination of an accused on his previous record, held that the section left room for exercise of a common law judicial discretion to exclude prejudicial evidence, something fundamental to the notion of a fair trial. Thus, it was open to a judge, notwithstanding section 12 to refuse leave to cross-examine on previous convictions if that would be prejudicial to the accused.

In this case, subsection 244(7) renders the affidavit admissible as "prima facie evidence" of the facts stated therein, not as conclusive proof of those facts. The affidavit is thus left open to challenge, and if the accused can satisfy the judge that its admission may be prejudicial because there is some valid reason to question its truth or accuracy, the judge at common law has the discretion to require the Crown to produce the affiant for cross-examination. The trial judge in this case held that he had the right, upon application by the accused, to require production of the affiant, but declined to do so because the accused had not made out any grounds for doing so. He was correct in so deciding. The existence of this right to demand cross-examination in cases where the admission of the affidavit would otherwise be prejudicial to the accused renders the first ground of appeal untenable.

The second ground of appeal is that subsection 244(7) denies the appellant the presumption of innocence guaranteed by subsection 11(d) of the Charter. This ground must also fail, given our conclusion that the appellant had, with the leave of the judge, the right to cross-examine on the affidavit. Even if we were wrong in that conclusion, the appeal must nevertheless fail.

First, subsection 244(7) does not change the burden of proof. It does not displace the onus on the Crown to prove its case beyond a reasonable doubt. It merely permits the Crown to prove certain facts as to search of records by means of affidavit. The evidence permitted concerns matters which are almost mechanical, and are probably done today by computer. They have also been described as merely administrative or procedural. The provision is not much different than those in the federal and provincial Evidence Acts which permit proof of government documents and business records by means of certificates and affidavits.

As to any suggestion that the affidavit under subsection 244(7), because it establishes facts from which the court may infer that the alleged offence occurred, casts an onus on the defence to prove otherwise, thereby amounting to reverse onus provision, such an argument was rejected by the Supreme Court in The Queen v. Holmes, [1988] 1 S.C.R. 914, 64 C.R. (3d) 97.

Second, subsection 244(7) is balanced by a provision which gives an accused the right to adduce evidence in a fashion similar to that permitted the Crown by subsection 244(7), for the purpose of rebutting the affidavit, or establishing a defence. That provision is subsection 244(17):

244.(17) In any prosecution for an offence under this Act, the production of a return, certificate, statement or answer required by or under this Act or a regulation, purporting to have been filed or delivered by or on behalf of the person charged with the offence or to have been made or signed by him or on his behalf shall be received as prima facie evidence that suchreturn, certificate, statement or answer was filed or delivered by or on behalf of that person or was made or signed by him or on his behalf.

If it may be said that the first provision somehow changes the burden of proof, the second balances any change by giving the accused an advantage in terms of means of proof equal to that given to the Crown. Or to put it another way, the rules of evidence are changed so that both the Crown and defence are permitted to prove certain routine facts by documentary evidence. That does not affect either the burden of proof or the presumption of innocence.

Finally, if we were wrong in the foregoing conclusions, and subsection 244(7) does amount to a reverse onus provision, it would not, nevertheless, offend subsection 11(d) of the Charter. In The Wholesale Travel Group Inc. v. R., [1991] 3 S.C.R. 154, 67 C.C.C. (3d) 193, it was held, in a case concerning a prosecution under the Competition Act, R.S.C. 1970, c. C-23 (per Cory, J. at page 58) as follows:

It has been noted earlier that the subsection 11(d) presumption of innocence has a different scope and meaning in relation to regulatory as opposed to criminal offences. In my view, the imposition in strict liability offences of a reverse persuasive onus on the accused to establish due diligence is proper and permissible and does not constitute a violation of the subsection 11(d) presumption of innocence. I therefore conclude that paragraphs (a) and (b) of subsection 37.3(2) do not violate subsection 11(d) of the Charter.

While the case is not directly on point, there is an analogy to be drawn. A prosecution for failure to file an income tax return falls in the same category as the offence under the Competition Act with which the Supreme Court was concerned. Accordingly, even if subsection 244(7) amounted to a reverse onus provision, it would not offend subsection 11(d) of the Charter.

The appeal is therefore dismissed.

Appeal dismissed.