Citation: 2007TCC543
Date: 20070911
Docket: 2006-1668(EI)
BETWEEN:
SÉBASTIEN ROUSSEAU,
Appellant,
and
THE MINISTER OF NATIONAL REVENUE,
Respondent.
[OFFICIAL ENGLISH
TRANSLATION]
REASONS FOR JUDGMENT
Lamarre Proulx
J.
[1] This is an appeal
from the decision of the Minister
of National Revenue (the Minister) that the Appellant was not employed in
insurable employment with Gestion Deva Inc. (the payor) from November 4,
2002, to January 10, 2003, and from April 26, 2004, to July 2, 2004.
[2] In making his decision, the Minister relied on the facts
set out as follows at paragraph 5 of the Reply to the Notice of Appeal:
[TRANSLATION]
(a) the payor was incorporated on May 12,
1997;
(b) during the periods in issue, the payor’s
majority shareholder was Marc‑André Plante;
(c) the payor was involved in carrying out a
project, which was not carried out, entailing 144 condominiums in Florida;
(d) at the end of the fiscal years on June 30,
the payor’s income was as follows:
|
|
2003
|
2002
|
2001
|
|
commission
income
|
$26,400
|
$42,000
|
$57,000
|
|
net income
|
($165)
|
($1,694)
|
$1,536
|
(e) there was no salary expense in the payor’s
financial statements;
(f) the payor was involved in an
investigation concerning 30 workers who received records of employment from the
payor without services rendered;
(g) on May 18, 2006, Marc‑André Plante
told a representative of the Respondent that he spoke with some people, asking
them to find investors for the condominium project and that he would pay them
for the time they spent soliciting investors;
(h) on May 18, 2006, Marc‑André Plante
told a representative of the Respondent that the Appellant was painting and
repairing furniture and that he would use that opportunity to speak with
potential investors about the payor’s project;
(i) in terms of objections, the Appellant did
not co-operate with the representative of the Respondent;
(j) on April 26, 2006, counsel for the
Appellant asked the representative of the Respondent to render a decision based
on the evidence in the case without further information from the Appellant;
(k) the Appellant was a painter, upholsterer
and furniture repairer;
(l) on October 26, 2005, in his statutory
declaration to Human Resources and Skills Development Canada (HRSDC), the
Appellant stated that he stripped and varnish frames and furniture for the
payor;
(m) the Appellant had business cards in his
name listing an address at Royale Avenue in the municipality of L’Ange‑Gardien;
(n) the Appellant’s workshop was located in a
building situated behind his parents’ residence;
(o) the Appellant provided accommodation,
tools and products in the performance of his duties;
(p) the Appellant claims that the payor paid
him $400 in cash per week;
(q) there is no evidence in the case showing
that the Appellant truly worked for the payor, no customer invoices, no
invoices for the purchase of materials;
(r) there is no evidence in the case that the
Appellant received pay;
(s) on May 8, 2006, Marc‑André Plante
told a representative of the Respondent that he met with the Appellant
[TRANSLATION] “a couple of times;”
(t) there is no evidence in the case to
support that there was control or subordination of the Appellant’s work by the
payor;
(u) for 2002 and 2003, the Appellant did not
have any reported income concerning the payor in his income tax returns;
(v) in 2003, the Appellant reported business
income;
(w) the Appellant did not file a tax return for
2004.
[3] Counsel for the Appellant made the following admissions and
denials for the Appellant. Paragraphs 5(a), (b), (j) to (n), (p) and (w)
were admitted. The other paragraphs were denied.
[4] Only the Appellant testified. He explained
that he was now a building painter. At the time of the events, he was an
apprentice.
[5] When he completed
his technical training in painting, he gave out business cards. Marc‑André Plante called him
to ask him to paint his kitchen in exchange for services he rendered to the
Appellant. Those services were to prepare the Appellant’s income tax returns.
Furthermore, Mr. Plante proposed paying him at an hourly rate of
$15 for 40-hour workweeks.
[6] In the first period,
the work consisted in restoring
furniture and in the second, it consisted in restoring windows. Mr. Plante
brought him the furniture and the windows. Sometimes the customers themselves
would come. According to the Appellant, it was not the customers who paid him
but Mr. Plante. Mr. Plante paid him $400 per week.
[7] The work was
carried out in a workshop
situated on the property of the Appellant’s family. Therefore, the Appellant
provided accommodation and tools. He states that it was not he who provided the
products but that the clients or Mr. Plante brought them. The clients
indicated what they wanted. The Appellant does not know how much
Mr. Plante charged the customers. When he ran out of work, the Appellant
would telephone Mr. Plante.
[8] The Appellant states that he rarely saw
Mr. Plante. He states, however, that he worked exclusively for him during
the periods in issue.
[9] The Appellant never provided T4 forms.
[10] The statutory declaration was filed as
Exhibit I‑1. Of that declaration, I reproduce questions 9 to 14:
[TRANSLATION]
Q(9) Did Marc‑André prepare your tax
returns?
(A) Yes. I cannot remember the years.
Q(10) How would you explain that in 2002, 2003 and
2004 you did not report income from Gestion Deva Inc. on your tax returns?
(A) I do not know. It was Mr. Plante who did my
tax returns.
Q(11) Were you, Mr. Rousseau, self-employed?
(A) No and yes. I stripped and varnished
furniture. I worked in a building situated behind my parents’ residence.
Q(12) How did you find customers?
(A) I gave out business cards and Mr. Plante referred
customers to me.
Q(13) What exactly did you and Mr. Plante
agree to?
(A) I provided accommodation, tools, products
and labour. Mr. Plante paid me $400 (gross) cash per week, always in cash.
Q(14) What was your gross salary?
(R) I do not know.
[11] Exhibits I‑3 and I‑4 were filed
on consent. Exhibit I‑3 described the charges against Marc‑André Plante
dated April 25, 2006. Charges 74 to 77 read as follows:
[TRANSLATION]
74. On or around January 10, 2003, in Québec
and elsewhere in the District of Quebec, made a false document, that is, a
false record of employment, knowing it to be false, with intent that it
should be used or acted on as genuine to the prejudice of the Government
of Canada (Department of Human Resources and Skills Development (Canada)), thus
committing a criminal offence under section 367(a) of the Criminal
Code.
75. In January 2003, in Québec and elsewhere in
the District of Quebec, knowing that a document was forged, that is, a record of employment, caused or attempted to cause
Sébastien Rousseau to use, deal with or act on it as if the
document were genuine, thus committing a criminal offence
under section 368(1)(b)(c) of the Criminal Code.
76. On or around July 9, 2004, in Québec and elsewhere
in the District of Quebec, made a false document, that is, a
false record of employment, knowing it to be false, with intent that it
should be used or acted on as genuine to the prejudice of the Government
of Canada (Department of Human Resources and Skills Development (Canada)), thus
committing a criminal offence under section 367(a) of the Criminal
Code.
77. In July 2004, in Québec and elsewhere in
the District of Quebec, knowing that a document was forged, that is, a record of employment, caused or attempted to cause
Sébastien Rousseau to use, deal with or act on it as if the
document were genuine, thus committing a criminal offence
under section 368(1)(b)(c) of the Criminal Code.
[12] Exhibit I‑4 includes the sentence and
guilty plea. We see that on September 27, 2006, Marc‑André Plante
pleaded guilty to the above-mentioned charges.
Analysis and conclusion
[13] I am of the opinion
that it is clearly a case of
fabricated employment.
[14] The very person who
was purported to be the employer admitted
that twice, that is, in January 2003 and July 2004, made false records of
employment for Sébastien Rousseau.
[15] The Appellant did not have this so-called
employer testify. The case law is consistent that a negative inference must be
drawn against a party who wishes to avail himself or herself of a situation,
who can provide evidence of such and does not.
[16] The amount of the hourly wage varies. At
the time of the statutory declaration, the Appellant could not remember his
gross salary. He remembered at the hearing. The supposed employment income was
never reported by the Appellant. During the statutory declaration, the
Appellant stated that he provided products. At the hearing, he contradicted
that statement by saying that the customers, or his supposed employer, brought
the required varnishes or paints.
[17] He denied allegations 5(q) and 5(r) of
the Reply but did not produce any document during the hearing.
[18] The evidence surely
did not demonstrate the existence
of a contract of employment.
[19] Accordingly, the appeal must be dismissed.
Signed at Ottawa, Canada, this 11th day of September
2007.
“Louise Lamarre Proulx”
Translation certified true
on this 5th day of October 2007.
Daniela Possamai,
Translator
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