Hurtubise v. M.N.R., docket 96-2451-UI

Date: 19980904

Docket: 96-2451-UI

BETWEEN:

RENÉ HURTUBISE,

Appellant,

and

THE MINISTER OF NATIONAL REVENUE,

Respondent.

Reasons for Judgment

Prévost, D.J.T.C.C.

[1] This appeal was heard at La Malbaie, Quebec, on August 6, 1998.

[2] It is an appeal from a determination by the Minister of National Revenue (“the Minister”) dated October 10, 1996, that the appellant’s employment with Bruno Dufresne Taxi, the payer, from September 25 to November 10, 1995, was insurable as an employer-employee relationship existed between the payer and the appellant, but that the insurable earnings for the period in question were only $1,270.

[3] Paragraph 5 of the Reply to the Notice of Appeal reads as follows:

[TRANSLATION]

5. In arriving at his decision the respondent Minister of National Revenue relied inter alia on the following facts:

(a) Bruno Dufresne is the sole owner of the payer, which operates 2 or 3 cars; (A)

(b) in September 1995 the appellant was without work and the payer offered him a position as a taxi driver; (A)

(c) the appellant’s work was to be temporary, replacing Bruno Dufresne who was ill; (A)

(d) there was an agreement between the payer and the appellant pursuant to which the latter would drive the taxicab generally driven by Mr. Dufresne, and the payer would continue to pay the taxes and all expenses relating to the car; (A)

(e) the appellant drove Mr. Dufresne’s car and at the end of each week the payer gave him 35 % of the profits from the car; (DAW)

(f) the appellant paid none of the costs of the use of the payer’s car; (A)

(g) at the end of seven weeks of work Mr. Dufresne took back his car and issued a record of employment in the appellant’s name, as if he had leased the car during that period; (D)

(h) the appellant’s record of employment, dated November 14, 1995, is incorrect as it does not reflect the actual situation regarding the agreement between the parties; (D)

(i) the appellant actually worked for seven weeks and received insurable earnings totalling $1,270 during that period; (D)

(j) the payer issued an amended record of employment dated March 22, 1996 showing the true situation and indicating that the appellant received insurable earnings of $1,270 during the period at issue. (A)

[4] In the preceding passage from the Reply to the Notice of Appeal the Court has indicated in parentheses after each subparagraph the comments made by the appellant at the start of the hearing, as follows:

(A) admitted

(D) denied

(DAW) denied as written

Appellant’s evidence

According to his testimony

Regarding subparagraph (e) above

[5] The percentage is not 35 %, but actually 40 %, as his employer absorbed the GST and QST, as mentioned in his statutory declaration (Exhibit I-1).

Regarding subparagraph (g)

[6] The appellant had checked with the local unemployment insurance office and learned that for taxi drivers there was a basis for making the calculations required for unemployment insurance purposes, but he could no longer really recall what it was.

Regarding subparagraph (h)

[7] His record of employment of November 14, 1995 (Exhibit I-2) indicated that he was earning $520 a week, but that was not what he in fact received.

[8] He submitted it to the unemployment insurance authorities nonetheless and received benefits accordingly.

[9] Subsequently, on March 22, 1996, the payer issued him another record of employment (Exhibit I-3) indicating that he had earned only $1,270 during his seven weeks of work, and this was quite true.

[10] The unemployment insurance authorities then claimed from the appellant the repayment of an “overpayment”.

Argument

According to the appellant

[11] The unemployment insurance office misled him and he did not want to suffer the consequences of that.

[12] He had not committed any fraud, but had simply been misinformed.

[13] However, he did not take the name of the employee at the unemployment insurance office who gave him this information.

According to counsel for the respondent

[14] The appellant’s insurable earnings are those appearing in the second record of employment (Exhibit I-3).

[15] Section 12 of the Unemployment Insurance Regulations reads as follows:

Employment in any of the following employments, unless it is excepted employment under subsection 3(2) of the Act or excepted from insurable employment by any other provision of these Regulations, is included in insurable employment: . . .

(e) employment of a person as a driver of any taxi . . . where that person is not the owner of the vehicle . . . .

[16] Subsection 17(3) of the Unemployment Insurance (Collection of Premiums) Regulations reads in part as follows:

(3) Where the owner, proprietor or operator of a business or public authority described in subsection (1) is unable to determine the earnings of a person whose employment in connection with the business or authority is included in insurable employment by virtue of paragraph 12(e) of the Unemployment Insurance Regulations, the insurable earnings of the person for each week during that employment shall be deemed to be an amount (taken to the nearest dollar) equal to 2/3 of the maximum weekly insurable earnings, unless . . . .

[17] The first record of employment (Exhibit I-2) was prepared on this basis, but the appellant’s earnings were known and they are what appear in the second record of employment (Exhibit I-3).

[18] The basis set forth in that regulatory provision was thus not applicable.

Analysis

[19] The appellant probably did call the unemployment insurance office, but he no doubt did not say that the payer knew full well what his earnings were.

[20] It is certain that the first record of employment (Exhibit I-2) was wrong: indeed, that is why the payer issued another one clearly indicating that the appellant had earned only $1,270 in the period at issue.

[21] The above-cited regulation is clear and does not need to be interpreted: it is only when a taxi driver’s earnings cannot be determined that the basis indicated therein can be applicable, and such is not the case here.

[22] The difference between the 35 % and the 40 % was explained well by the appellant, but that does not alter matters in any way.

[23] It is most unfortunate that the appellant should find himself in this situation, but the Minister is not bound by information supplied by unemployment insurance officials, even if the appellant had explained his situation properly at the outset, which is doubtful since in court he no longer even remembered what basis was used.

[24] The appellant was not accused of fraud in the instant case, and there is no need to pursue that point any further.

[25] The Court must arrive at its decision within the framework of the Act and Regulations and in so doing herein cannot but dismiss the appeal and affirm the decision appealed from.

Signed at Laval, Quebec, this 4th day of September 1998.

"A. Prévost"

D.J.T.C.C.

[OFFICIAL ENGLISH TRANSLATION]

Translation certified true on this 20th day of April 1999.

Erich Klein, Revisor