R. v. Lagiorgia, 87 DTC 5245, [1987] 1 CTC 424 (FCA)

Hugessen, J.:—These appeals raise but a single issue, which may be starkly stated :

May the Crown require that property seized in violation of section 8 of the Charter not be returned to the subject who was legally in possession of it at the time of such seizure?

In Court file A-456-85, the Crown, acting under the provisions of subsection 231(4) of the Income Tax Act as it then read (July 8, 1982), seized a quantity of books and papers belonging to respondent Lagiorgia. The latter brought proceedings in the Trial Division to have the seizure set aside and the seized documents returned to him. By the judgment appealed from, Joyal, J. granted the relief sought. The Crown appeals, seeking to be exempted from returning certain of the documents which it says are required in connection with a pending criminal prosecution. The respondent crossappeals and seeks to extend the order to all copies or extracts of the seized documents as well as to restrain the Crown from making any use of the information obtained from them.

In Court file A-245-85 (Skis Rossignol Canada Ltd. et al.), the seizure was carried out under the then (August 23, 1982) provisions of subsections 10(1) and 10(3) of the Combines Investigation Act. Denault, J. while allowing an application by the appellants to have the seizures set aside, permitted the Crown to retain possession of copies of documents said to be required for a pending prosecution; it is this latter aspect of his order which the appellants put in issue before us.

It is common ground that both seizures were properly found to be illegal as being based upon statutory provisions which failed to meet the test of section 8 of the Charter. That is the unavoidable consequence of the decisions of the Supreme Court in Hunter v. Southam, [1984] 2 S.C.R. 145; and 14 C.C.C. (3d) 77 and of this Court in M.N.R. v. Kruger, [1984] 2 F.C. 535; [1984] C.T.C. 506. It is also not disputed that the Crown was in good faith when it carried out the seizures, which were based on what were thought at the time to be valid statutory provisions. Finally, there can be little question that the material seized would be useful to the Crown in its pending prosecutions.

In our view, the question posed by these appeals falls to be answered by reference solely to section 8 and subsection 24(1) of the Charter. We are in no way concerned with the exclusion or admissibility of evidence, a matter dealt with in subsection 24(2) and over which, in the context of the pending criminal prosecutions, this court would have no jurisdiction.

Section 8 protects rights of privacy and property against "unreasonable" state intrusion. The balancing of public versus private interests takes place at the time that it is determined whether or not any given search or seizure is in breach of the section. That determination has already taken place and is no longer in issue here.

In our view, it would be difficult to think of any more appropriate remedy for the unreasonable and therefore illegal seizure of property than to order its immediate return to its rightful owner and lawful possessor. Anything less negates the right and denies the remedy. The only circumstances which suggest themselves to us as justifying a court in refusing such an order would be where the initial possession by the person from whom the things were seized was itself illicit, e.g. in the case of prohibited drugs or weapons. While there may be other cases, there can be no doubt in our minds that when the Crown seeks, as in effect it does here, to profit from a Charter-barred seizure it bears a very heavy burden indeed (see R. v. Chapman (1984), 12 C.C.C. (3d) 1; 46 O.R. (2d) 65; Lefebvre v. Morin, Que. C.A. February 4, 1985 (unreported) (No. 200-10-000-174-83). With due respect to those who appear to hold the opposite view (Re Dobney Foundry (1985), 19 C.C.C. (3d) 465; [1985] 3 W.W.R. 626; Re Mandel (1986), 25 C.C.C. (3d) 461, we do not think that burden can be satisfied today by a simple assertion that the things seized are needed for a prosecution.

It is common ground here that the Charter, the supreme law of the land, has been breached. We cannot read subsection 24(1) as giving a discretion to hold that such breach may be overlooked in order to facilitate a simple prosecution for tax evasion or price maintenance.

We emphasize once again that our decision today deals only with the appropriate civil remedy for the acknowledged invasion of Charter-guaranteed rights. Nothing we say should be read as bearing in any way on whether Skis Rossignol Canada Ltée et al. v. Hunter et al.

the Crown can or should be allowed to re-seize the subject documents or to use them or the information they contain as evidence.

Accordingly, in file A-456-85, Lagiorgia, the appeal will be dismissed with costs. As to the cross-appeal, counsel at the hearing abandoned the request for a restraining order and there remains only the question of extracts or copies of the seized documents. The trial judge's failure to mention them appears to us to be a simple oversight; certainly, if the remedy he granted is to be effective, it must extend to them as well. The retention of unauthorised copies or extracts is as much an invasion of privacy and property as is the original seizure. The cross-appeal will therefore be allowed so as to modify the trial judge's order by extending it to cover all copies or extracts made from the seized documents. Since the Crown resisted the crossappeal, the respondent cross-appellant is entitled to his costs thereon.

In file A-245-85, the appeal will be allowed with costs and the order of the trial judge will be varied by deleting that part which allows the Crown to retain certain documents for the purposes of prosecution. The trial judge also, without giving reasons, awarded costs in favour of the Crown; since the record discloses no ground upon which costs could properly have been awarded against the successful plaintiffs, the order will also be varied so as to grant them their costs in the Trial Division.

Order accordingly.