Date: 20110221
Docket: T-5-10
Citation: 2011 FC 204
Ottawa, Ontario, February
21, 2011
PRESENT: The Honourable Mr. Justice Near
BETWEEN:
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UNITED PARCEL SERVICE CANADA
LTD.
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Applicant
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and
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MINISTER OF PUBLIC SAFETY
AND EMERGENCY PREPAREDNESS
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Respondent
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REASONS FOR JUDGMENT AND
JUDGMENT
[1]
This
is an application for judicial review of a Ministerial Decision made under
section 129 of the Customs Act (the Act). The Minister decided to
uphold the Canadian Border Services Agency’s (CBSA) determination that the
United Parcel Service Canada Ltd. (UPS) contravened the Act by failing to
provide CBSA with an opportunity to inspect 174 shipments and further
determined that the demand for payment of a $522,000 penalty was justified.
[2]
For
the reasons set out below, this application is dismissed.
I. Background
A. Factual
Background
[3]
The
Applicant, UPS, is a courier company that delivers a high volume of parcels
shipped from outside Canada to consignees in Canada.
[4]
The
Customs Act, R.S.C. 1985, c.1 (2nd Supp.), gives the CBSA the authority
to examine shipments imported into Canada in order to ensure that
the goods comply with customs legislation. As an importer, UPS is required to
report all goods imported into Canada to the CBSA.
[5]
Under
the Low Value Shipping Program (LVS), which applies to imported goods valued
from $20.01 to $1600, UPS daily submits cargo release lists to the CBSA. These
lists detail all the shipments that UPS has received, or expects to receive
that day. CBSA reviews the list and determines which items CBSA wants to
inspect once they arrive at the sufferance warehouse. The selected items
are segregated from the other parcels, which are released to be delivered. The
list is initially provided electronically and then later burned onto a CD-ROM
and submitted to the CBSA.
[6]
On
April 4, 2005, the CBSA’s Targeting and Risk Analysis Unit conducted a risk
analysis of the cargo described on the UPS cargo release lists stored on these
CDs. CBSA officers noticed additional tracking numbers under the heading
“Dutiable manifest no data was found on the following” and “Count of packages
Scanned Not Keyed (SNK)”. CBSA became concerned that these numbers were
related to shipments that were “scanned” into the sufferance warehouse but not
reported to the CBSA.
[7]
The
CBSA contacted UPS to inquire about the SNKs. UPS explained that the SNKs were
numbers created at their export sites. However, UPS was unable to explain why
there was no information accompanying these numbers.
[8]
As
a result, the CBSA conducted a desk audit of the transactions involving the UPS
sufferance warehouse in Richmond, B.C. between April
2004 and April 2005. 9,789 SNKs were identified during this period. The CBSA
decided to focus on 20 CDs for the months of February, March and April 2005
which identified 604 SNKs.
[9]
In
their written submissions, UPS details the shipping and tracking procedure
applied to packages imported into Canada. Every package is
“scanned” at the export site using a handheld device. To ensure accuracy,
another employee manually verifies that all the information required for the
package to be shipped internationally is in the UPS Computer System. This
employee will key in any missing information. Packages that are scanned, but
not keyed in by the second employee remain in a “suspense state” in the system.
[10]
A
Scan report is generated daily by UPS listing all packages expected to enter to
Canada on that
day. This list includes all packages scanned into the Computer System,
regardless of whether or not the package has been keyed in. “Suspense state”
information is therefore included. The UPS Computer System generates exception
notifications where the information scanned from a bar-coded label does not
match any information relating to a package tracking number. These exception
notifications appear on the reports as the SNKs.
[11]
UPS
contends that SNKs occur due to a number of circumstances, including instances
where customers re-use packaging without removing the old bar-coded shipping
labels. If an old barcode is inadvertently scanned and the information in the
system relating to the old barcode is not deleted, an SNK is generated.
[12]
It
is UPS’s position that an SNK in and of itself does not identify a package that
was not otherwise entered into the UPS computer system, but is rather an
electronic artefact or a redundant reference to a package already reported to
the CBSA.
[13]
The
daily cargo release lists sent to the CBSA did not include the list of SNKs.
According to UPS, the SNKs are directed to a UPS employee in the
discrepancy-resolution group who is supposed to check each SNK. However, UPS
claims that UPS staff at the Richmond B.C. sufferance
warehouse inadvertently included the list of SNKs when burning the daily cargo
release lists onto CD-ROM.
[14]
Nevertheless,
on April 25, 2005 CBSA issued a written request for explanations regarding the
SNKs and evidence of legal disposition of these packages. The Respondent describes
possible explanation for the SNKs in their written submissions, such as:
“shortages”, when a package that was expected to arrive is reported but does
not arrive; or “overages”, when an unexpected package enters Canada. In both of
these instances, UPS would be able to provide evidence to satisfy the CBSA that
unreported goods had not entered Canada.
[15]
UPS
was able to provide information requested by the CBSA for 479 of the SNKs
identified. Of the 479 responses, 331 showed some evidence of legal
disposition. As for the remaining 273 SNKs, CBSA found that UPS failed to
provide information in a timely manner.
[16]
UPS
was later able to provide evidence for a further 110 shipments, but was still
unable to provide evidence of legal disposition with respect to the remaining
163 packages.
[17]
The
Respondent claims that UPS’s own computer system shows that these shipments
were either scanned in at the sufferance warehouse or delivered to an address
in Canada.
[18]
On
September 19, 2005, UPS’s manager at the Vancouver Airport
wrote an e-mail to the CBSA explaining that UPS had identified the root cause
of the issue and had implemented corrective action. The categories of packages
responsible for the SNKs were “goods gone astray” – goods destined within the
U.S. or exported from the U.S. going to overseas destinations and delivered
into Canada due to human error; “goods originally exported from Canada to
various destinations worldwide, and then returned to Canada for whatever
reason”; and “domestic goods… misdirected to the U.S.” and returned to Canada.
It seems that most of these packages were forwarded to their destination
without being first reported to the CBSA.
[19]
The
Administrative Monetary Penalty System (AMPS) is meant to ensure compliance
with the reporting requirements relating to the importation of goods into Canada. Under AMPS
persons who fail to properly report importations can be subject to penalties.
[20]
When
a penalty is assessed against a person under the AMPS, the person receives a
Notice of Penalty Assessment (NPA) from the CBSA describing the infractions and
the penalties incurred. On October 5, 2005, the CBSA decided to issue a single
NPA in respect of the 163 SNKs (the Original Penalty). The 163 SNKs were
found to be a violation of C358, a specific infraction under the AMPS applied
whenever a customs officer believes that a shipment was removed from a customs
facility prior to the authorisation of, or release by, CBSA. Since there was
no information on the value of the SNK generating packages, they were each
assigned a nominal value of $1.00.
[21]
The
decision to issue a single NPA instead of 163 individual NPAs was made in
consultation with several CBSA officials. After further consultation, the CBSA
decided that it would be more appropriate to issue individual NPAs for each
occurrence. The Respondent contends that this decision was taken in part to
allow CBSA to cancel an entire NPA if UPS was able to provide satisfactory
evidence of legal disposition since at the time, CBSA’s computer system did not
allow the cancellation of individual infractions within one NPA.
[22]
The
Applicant submits that in early November a CBSA employee visited the sufferance
warehouse and, without authorization, physically removed the only copy of the
Original Penalty from a UPS employee’s desk before anyone had a chance to
photocopy it.
[23]
The
CBSA determined that there were an additional 11 infractions of C358 subsequent
to the issuance of the Original Penalty and replaced the Original Penalty with
174 individual NPAs on November 11, 2005 (the Replacement Penalties). The CBSA
demanded payment of $522,000. In the Issuing Officer Report attached to the
replacement NPAs the CBSA explained that after further consultation with the
AMPS Policy and Program group, it was decided that the Original Penalty was to
be cancelled and re-issued with individual assessments. According to the
report, the cancellation was due to an administrative error during the
processing of the Original NPA.
[24]
Pursuant
to subsection 129(1) of the Act, UPS submitted a Request for Ministerial
Decision regarding the Replacement Penalties.
[25]
The
CBSA prepared a Case Synopsis and Reasons for Decision setting out UPS’s submissions
and the CBSA’s responses regarding the Replacement Penalties.
[26]
By
letter dated December 4, 2009 the Minister communicated his decision that there
was a contravention under the Act and the Customs Regulations and that the
Replacement Penalties assessed under contravention C358 were justified. The
Minister demanded payment of $522,000. It is this demand for payment that is
the subject of this application for judicial review.
B. Impugned
Decision
[27]
The
Minister decided that there had been a contravention of the Act, and that the
penalties as assessed under Code C358 on the NPAs were justified. The Minister
took into consideration several facts before deciding to uphold the penalties. Although
UPS claimed that the $522,000 penalty was punitive, the Minister decided to
maintain the penalties as assessed based on the fact that the verification
process was limited to a period of time from February to March 2005 and only
604 SNKs, whereas the audit had identified 9,798 SNKs on 237 CDs for the period
from April 2004 and April 2005. The Minister found that UPS’s failure to allow
the CBSA to review these shipments compromised the CBSA’s mandate and thus the
penalty was justified.
II.
Issues
[28]
The
Applicant submits the following issues:
(a) Did
the Minister act beyond his statutory authority:
(1) in
assessing the Original Penalty for an amount in excess of the $3,000 AMPS
maximum and the $25,000 statutory maximum under section 109.1 of the Act? and
(2) having
cancelled the Original Penalty under subsection 127.1(1) of the Act, in
assessing the Replacement Penalties for the same subject matter as the Original
Penalty not for the purpose of eliminating or reducing the Original Penalty but
for the purpose of increasing it?
(b) Did
the Minister fail to act in accordance with the principles of procedural
fairness by taking into account irrelevant matters (i.e., the SNKs) while
failing to take into account relevant matters such as the indeterminate nature
of the SNKs and the true nature of the contraventions?
[29]
The
Respondent, on the other hand, submits that the issues in this application are:
(a) The permissible scope of an
application to challenge a decision under section 133 of the Customs Act;
(b) The reasonableness of the
Minister’s decision to maintain the penalty as assessed; and
(c) The
effect of cancelling the original Notice of Penalty Assessments (NPA) and the
issuance of multiple NPAs.
[30]
In
my view, the issues are best summarized as:
(a) The
permissible scope of this application for judicial review
(1) The reasonableness of the Minister’s
decision to maintain the penalty as assessed; and
(b) The
statutory jurisdiction of the Minister regarding:
(1) The
maximum allowable penalty
(2) Cancellation
of a NPA
III.
Argument
and Analysis
A. Permissible
Scope of the Application
[31]
The
Applicant submits that the Minister violated his duty of procedural fairness in
determining that the 174 SNKs were proof of a violation of Contravention C358.
The Applicant’s position is that in deciding that there was a contravention of
the Act or the Regulations with respect to the Notice served, the Minister
acted on the basis of presumed, unsubstantiated and erroneous findings of fact
and erroneous conclusions of law. The Applicant bases this argument on their
contention that the SNKs do not independently establish that goods were removed
from a UPS sufferance warehouse without prior CBSA authorization, the required
basis for finding a Contravention C358. The Applicant submits that by
continuing to base his demand for payment on the incorrect assumption that SNKs
independently establish that goods were removed from a UPS sufferance
warehouse, the Minister relied on irrelevant matters.
[32]
The
Respondent argues that this argument is, in essence, a challenge to the
Minister’s finding that, under the provisions of section 131, there was a
contravention of the Act. The Respondent’s position is that such a challenge
is beyond the jurisdiction of this Court in an application for judicial review.
[33]
The
Applicant made use of section129 of the Act, which provides for persons on whom
a notice is served to "request a decision of the Minister under section
131". The structure of the Act provides that in responding to such a
request, the Minister may make two separate decisions.
[34]
Firstly,
under subsection 131(1) the Minister decides whether or not there has been a
contravention of the Act or regulations. Subsection 131(3) provides a
statutory appeal for this decision as laid out in section 135. The section 131
decision cannot be judicially reviewed, rather, according to the provisions of
section 135,
an appeal must be the subject of an action in the Federal Court. Subsection
131(3) states:
Judicial
review
(3)
The Minister’s decision under subsection (1) is not subject to review or to
be restrained, prohibited, removed, set aside or otherwise dealt with except
to the extent and in the manner provided by subsection 135(1).
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Recours
judiciaire
(3)
La décision rendue par le ministre en vertu du paragraphe (1) n’est
susceptible d’appel, de restriction, d’interdiction, d’annulation, de rejet
ou de toute autre forme d’intervention que dans la mesure et selon les
modalités prévues au paragraphe 135(1).
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[35]
Subsection
135(1) provides:
135 (1) A person who requests a
decision of the Minister under section 131 may, within ninety days after
being notified of the decision, appeal the decision by way of an action in
the Federal Court in which that person is the plaintiff and the Minister
is the defendant.
(emphasis added)
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135. (1) Toute personne qui a demandé
que soit rendue une décision en vertu de l’article 131 peut, dans les
quatre-vingt-dix jours suivant la communication de cette décision, en
appeler par voie d’action devant la Cour fédérale, à titre de demandeur,
le ministre étant le défendeur.
(notre soulignement)
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[36]
If
in responding to a request for a decision, the Minister decides that there has
been a contravention, then the Minister may make a second decision relating to
the amount of penalty owed. Section 133 of the Act allows the Minister to
remit any portion of the penalty assessed under section 109.3, or demand
that an additional amount be paid.
[37]
The
Respondent’s position, therefore, is that the provided statutory appeal route
ousts the jurisdiction of this Court to review a section133 decision by way of
an application for judicial review. The Respondent asserts, correctly in my
view, that UPS should have brought an action under section 135 within 90 days
of notice of the decision in order to challenge the Minister’s holding that
there has been a contravention.
[38]
As
support for this position, the Respondent cites ACL Canada Inc. v Canada (Minister of
National Revenue - MNR), (1993) 68 FTR 180, 107 DLR (4th) 736 (F.CTD).
In that case, Justice Andrew MacKay stated at para54:
In my view, Parliament has
insulated from appeal the penalty imposed in the event there is found to be a
contravention of the Act. That may seem surprising since the penalty will often
be the primary concern of the person whose goods are seized under the Act or
who is served with a notice and demand for payment under s.124. Yet that simply
carries on a long-standing regime under Customs Acts of the past, at least in
relation to goods seized, for the goods are forfeited to Her Majesty at the
time of the contravention of the Act (s. 122), and terms of any remission,
where the Act or regulations are contravened, have been considered beyond the
role of the Court to review. (Lawson et al. v. The Queen, [1980] 1 F.C.
767 F.C.T.D. (per Mahoney J. at 772)).
[39]
The
scope of this application for judicial review is therefore limited to
determining whether or not the Minister’s decision to maintain the amount of
the penalty assessed is reasonable. UPS’s submissions regarding an alleged
violation of the duty of procedural fairness in determining that there was a
contravention in the first place, is not for this Court to review. However,
when considering the penalty applied, to quote Justice MacKay in ACL,
above, again at para 55:
This does not mean that the
discretion vested in the Minister in relation to penalties is unlimited. The
Act and regulations specify maximum penalties, and the determination of a
penalty will not be beyond the jurisdiction of the Court in terms of remedies
for judicial review of administrative decisions, primarily in regard to the
duty of fairness. In the result, I am persuaded that while the Court has no
jurisdiction under s. 135 to review the penalty imposed where there is an
infraction of the Act, it does have jurisdiction, under ss. 18 and 18.1 of
the Federal Court Act, R.S.C. 1985, c. F-7 as amended by S.C. 1990, c.
8, ss. 4, 5, to consider whether the discretion to impose penalties, consequent
upon a contravention of the Act, has been exercised in accordance with the law.
(1) Standard
of Review
[40]
The
Respondent submits that the Minister’s decision should be reviewed on a
standard of reasonableness for the following reasons:
(i) Parliament
did not intend a right of appeal and the only way to review the penalty or
forfeiture amount imposed is by way of judicial review. This indicates a high
level of deference;
(ii) The
Minister has expertise with respect to the administration of penalties under
the Act and his expertise is related to the matter before him;
(iii) Section
133 is discretionary;
(iv) The
purpose of the Act is to regulate the importation of goods into Canada and the
duties payable on such goods. The Act also sets penalties for contraventions
of the Act and regulations to uphold the customs system and to ensure
compliance; and
(v) The
question is highly factual and involves broader issues of public policy.
[41]
UPS
argues, and this Court agrees, that procedural fairness ought to be reviewed on
the correctness standard. However, based on the above reasoning, UPS’s
procedural fairness argument is not within the scope of review on this
application.
[42]
Even
if the procedural fairness arguments were before the Court, by way of arguing
that the Minister based the decision to maintain the penalties as assessed,
which is presently reviewable, on irrelevant information, UPS has not persuaded
me that the SNKs are in fact, irrelevant. The SNKs are the basis of the entire
audit and subsequent NPAs and penalties. UPS has not been able to convince the
CBSA in the six years since the initiation of this process that the SNKs are
irrelevant, and they are unable to convince this Court now – either because
such a finding is outside the scope of review or because I cannot see how the
Minister failed to meet his duty of procedural fairness to the Applicant by
relying on the SNKs. The Applicant was able to make presentations, and know
the case they needed to meet. The caselaw cited by the Applicant (Elwell v Canada (Minister of
National Revenue - MNR), 2004 FC 943, 2004 DTC 6543) is largely
inapplicable to the present matter. That decision deals with an applicant who
was found to have been denied procedural fairness by the CCRA due to the
Minister’s inability to produce any documentary evidence that it had sent the
applicant notices it claimed to have sent numerous times in a matter rife with examples
of poor communication between the parties and significant delay.
[43]
It
is therefore, a matter of determining whether the Minister’s decision regarding
the penalty amount is reasonable.
[44]
The
Respondent submits that the Minister based his decision on the fact that the
amount charged represented only a fraction of the amount that that would have
likely been demanded if the CBSA had undertaken a broader audit. The Respondent
argues that given the scale of the offence as well as its severity, the
Minister’s discretion to maintain the penalty amount cannot be said to be
unreasonable.
[45]
I
agree with the Respondent’s submissions on this point. The Minister’s decision
is transparent and intelligible. This Court will not overturn it for lack of
compliance with the demands of the reasonableness standard.
B. Did
the Minister Exceed his Statutory Authority?
(1) The
Statutory Maximum Penalty
[46]
The
Applicant submits that the Minister exceeded his statutory authority in
cancelling the Original Penalty, and replacing it with an increased penalty.
[47]
The
Applicant argues that the Minister erred in demanding payment that exceeded the
statutory and AMPS maximum penalties. Subsection 109.1(1) of the Act provides
that a person who fails to comply with any provision of the Act, or certain
regulations, is liable to a penalty of not more than $25,000.
Designated
provisions
109.1
(1) Every person who fails to comply with any provision of an Act or a
regulation designated by the regulations made under subsection (3) is liable
to a penalty of not more than twenty-five thousand dollars, as the Minister
may direct.
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Dispositions
désignées
109.1
(1) Est passible d’une pénalité maximale de vingt-cinq mille dollars fixée
par le ministre quiconque omet de se conformer à une disposition d’une loi ou
d’un règlement, désignée par un règlement pris en vertu du paragraphe (3).
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[48]
The
CBSA Master Penalty Document provides that for Contravention C358 the maximum
penalty that can be imposed is the greater of $3,000 or 20% of the value for
duty on a third and subsequent occurrence of the contravention.
[49]
AMPS
penalties provided for by subsection 109.1(1) are assessed under 109.3(1). This
subsection requires that a written notice of assessment be sent to anyone who
is liable for a penalty under section 109.1.
Assessment
109.3
(1) A penalty to which a person is liable under section 109.1 or 109.2 may be
assessed by an officer and, if an assessment is made, an officer shall serve
on the person a written notice of that assessment by sending it by registered
or certified mail or delivering it to the person.
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Cotisation
109.3
(1) Les pénalités prévues aux articles 109.1 ou 109.2 peuvent être établies
par l’agent. Le cas échéant, un avis écrit de cotisation concernant la
pénalité est signifié à personne ou par courrier recommandé ou certifié par
l’agent à la personne tenue de la payer.
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[50]
The
Original Penalty notice demanded payment of $489,000. The Applicant submits that
this amount is in excess of the statutory maximum described in 109.1.
[51]
From
reading the record, I understand that the Applicant sought to adduce evidence
on the cross-examination of Robert Carmichael that the CBSA cancelled the
Original Penalty when they realized that it violated the statutory maximum
penalty. When the Applicant pressed the affiant on the issue, he speculated
that the “administrative error” that prompted the cancellation was simply the
most applicable choice of generic descriptor required by the administrative
system used to cancel the NPA. The affiant maintained that the CBSA could have
either issued a single NPA or multiple NPAs.
[52]
The
Respondent’s submissions on this point argue that the Applicant has made a
technical argument over the meaning of “penalty”. It is the Respondent’s
position that one NPA may contain many contraventions, and it is each
contravention or penalty and not the NPA itself that is subject to the
statutory maximum.
[53]
I
agree with the Respondent. I can see nothing in the legislation, and no
justification in the Applicant’s submissions, to support the contention that
each NPA can only contain one contravention or penalty. It is obvious from the
record that the CBSA debated about how to proceed, whether by a single NPA to
cover all SNKs, or individual NPAs for each SNK. Each SNK was given a nominal
value of $1. In light if the scale of the contravention, the CBSA then applied
the AMPS maximum of $3000 to each SNK to arrive at the amount demanded.
[54]
I
cannot say that the Minister exceeded his statutory jurisdiction in upholding
the $522,000 penalty.
(2) The
Effect of Cancelling the Original Penalty
[55]
The
Applicant argues that the Minister’s decision to cancel the Original Penalty
and issue a Replacement Penalty that exceeded the Original Penalty amount is
governed by section 127.1 of the Act. This section entitles the Minister to cancel
a penalty issued under section 109(1):
Corrective
measures
127.1
(1) The Minister, or any officer designated by the President for the purposes
of this section, may cancel a seizure made under section 110, cancel or
reduce a penalty assessed under section 109.3 or an amount demanded under
section 124 or refund an amount received under any of sections 117 to 119
within thirty days after the seizure, assessment or demand, if
(a) the Minister is satisfied that
there was no contravention; or
(b) there was a contravention but the
Minister considers that there was an error with respect to the amount
assessed, collected, demanded or taken as security and that the amount should
be reduced.
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Mesures
de redressement
127.1
(1) Le ministre ou l’agent que le président désigne pour l’application du
présent article peut annuler une saisie faite en vertu de l’article 110,
annuler ou réduire une pénalité établie en vertu de l’article 109.3 ou une
somme réclamée en vertu de l’article 124 ou rembourser un montant reçu en
vertu de l’un des articles 117 à 119, dans les trente jours suivant la saisie
ou l’établissement de la pénalité ou la réclamation dans les cas suivants :
a) le ministre est convaincu qu’aucune
infraction n’a été commise;
b) il y a eu infraction, mais le
ministre est d’avis qu’une erreur a été commise concernant la somme établie,
versée ou réclamée en garantie et que celle-ci doit être réduite.
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[56]
Aside
from subsection 127.1 there is no other provision in the Act giving the
Minister the authority to cancel penalties. Subsection 127.1 does not allow
the Minister to re-issue penalties in respect of the same contravention, nor is
there any other provision enabling the Minister to act in such a way. So it is
the Applicant’s position that in cancelling the penalty in accordance with
subsection 127.1, the Minister must have decided that either a) there was
no contravention, or b) there was a contravention but there was an error with
respect to the original amount assessed and it should therefore be reduced.
The Minister therefore erred in issuing the Replacement Penalty for an
increased amount.
[57]
The
Respondent submits that the Applicant makes an overly technical argument.
There was no cancellation of the penalty as provided for by subsection 127.1,
rather the Minister simply reissued the same penalties for the same amount, for
the same infractions. At the hearing, the Respondent argued that the penalties
themselves were never cancelled, only the original NPA was cancelled and then
reissued as individual NPAs. The penalties themselves always remained the
same. Eleven additional penalties were issued for contraventions discovered
subsequent to the issuance of the original penalty. The record makes it clear
that the Minister did not decide that there was no contravention, and there was
no error that would account for a consideration penalty reduction. The Respondent
submits that the reason why the original NPA was cancelled is largely
irrelevant.
[58]
Based
on the affidavit evidence, the CBSA originally decided to issue one NPA with
163 occurrences to reduce the amount of documentation. After further
consideration, the CBSA decided that it would be better to issue 163 individual
NPAs due to the CBSA’s computer system’s inability to cancel individual
occurrences within a single NPA.
[59]
Given
my conclusion that nothing in the Act precludes one NPA from including several
contraventions, each contravention being individually subject to the statutory
maximum penalty, I am unable to see how the Applicant has suffered any
prejudice in the reissuance of multiple NPAs for penalties of the same amount.
While it might be true that nothing in the Act explicitly grants the CBSA or
the Minister the authority to reissue penalties in a different administrative
form, or to cancel NPAs, I am guided by the modern principles of statutory
interpretation –
Today there is only one principle or
approach, namely, the words of an Act are to be read in their entire context
and in their grammatical and ordinary sense harmoniously with the scheme of the
Act, the object of the Act, and the intention of Parliament.
(as cited in Rizzo & Rizzo Shoes
Ltd. (Re), [1998] 1 S.C.R. 27 at para 21)
In reading the
applicable provisions together, there is nothing that suggests that an NPA
should be conflated with a penalty. The Applicant’s submission that the
Minister’s acted without jurisdiction in reissuing an NPA is unfounded.
[60]
I
also take note of the Respondent’s submission that the Applicant only raised
the argument based on section 127 in the application for judicial review. The
Applicant never raised this issue with the Minister’s delegate when seeking a
Ministerial Decision under section 129 of the Act.
[61]
Even
if the Minister had no authority to cancel the Original Penalty outside the
scheme provided for in subsection 127.1, I am persuaded by the Respondent’s
submissions that this is a technical irregularity wherein no substantial wrong
has occurred. The Respondent asks the Court to use the discretion provided
under paragraph 18.1(5)(a) of the Federal Courts Act which provides:
Defect
in form or technical irregularity
(5)
If the sole ground for relief established on an application for judicial
review is a defect in form or a technical irregularity, the Federal Court may
(a)
refuse the relief if it finds that no substantial wrong or miscarriage of
justice has occurred; and
|
Vice
de forme
(5)
La Cour fédérale peut rejeter toute demande de contrôle judiciaire fondée
uniquement sur un vice de forme si elle estime qu’en l’occurrence le vice
n’entraîne aucun dommage important ni déni de justice et, le cas échéant,
valider la décision ou l’ordonnance entachée du vice et donner effet à
celle-ci selon les modalités de temps et autres qu’elle estime indiquées.
|
[62]
In
my view this is an appropriate matter in which to use this discretion
[63]
In
the alternative, if the cancellation of the Original Penalty was in error, the
Respondent submits that the Applicant seeks an inappropriate remedy. The
Applicant contends that the Minister acted without authority in cancelling the
Original Penalty and Issuing the Replacement Penalty, and so the demand for
payment should be quashed. The Respondent, on the other hand, submits that if
the Minister acted without authority, it is appropriate for the Court to undo
what was done. In this case, that would mean un-cancelling the Original
Penalty. If this Court takes that route, there is nothing to prevent the
Minister from issuing NPAs for the subsequent 11 infractions after the fact.
Therefore, the result is the same and the Applicant is still subject to the
same demand for payment.
IV. Conclusion
[64]
In
consideration of the above, this application for judicial review is dismissed.
There is no order as to costs.
JUDGMENT
THIS COURT’S JUDGMENT
is that:
1.
This
application for judicial review is dismissed.
2.
No
order as to costs.
“ D.
G. Near ”