Citation: 2006TCC207
Date: 20060331
Docket: 2005-110(CPP)
BETWEEN:
ANDRZEJ S. STAWICKI,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent,
and
JUDITH E. WILSON,
Intervenor.
Docket: 2005-111(EI)
AND BETWEEN:
ANDRZEJ S. STAWICKI,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent,
and
JUDITH E. WILSON,
Intervenor.
REASONS FOR JUDGMENT
Beaubier, J.
[1] These appeals were heard together on common evidence at Victoria, British Columbia, on March 17 and 18, 2006. The Appellant ("Andrew") subpoenaed and called the Intervenor, Judith Wilson ("Judy") to testify and testified himself. Judy also testified for herself and called Cathleen Wormald to testify.
[2] The matters in dispute are set out in paragraphs 5 to 9 inclusive of the Reply to the Notice of Appeal, 2005-211(EI), which read:
5. Human Resources Skills Development Canada requested a ruling from the Minister of National Revenue (the "Minister") as to whether the Appellant employed Judy Wilson ("Wilson") in insurable employment from January 1, 2002 to November 10, 2002 (the "Period"). The Rulings Division decided and so notified the Appellant by letter dated July 4, 2003 that Wilson's employment during the Period was insurable.
6. The Appellant filed an appeal to the Minister on October 2, 2003 under section 91 of the Employment Insurance Act, S.C. 1996, c. 23 (the "EI Act").
7. The Minister decided that the Appellant employed Wilson under a contract of service within the meaning of paragraph 5(1)(a) of the EI Act during the Period and so notified the Appellant by letter dated October 21, 2004.
8. In so deciding, the Minister assumed the following facts:
a) the Appellant operated a proprietorship which operated a roof restoration, cleaning and repair business during the Period;
b) the Appellant operated his business from an office located in his personal residence;
c) the Appellant hired Wilson to perform duties which included answering the business telephone, typing letters and contracts, payroll, bookkeeping and accounting (the "Office Duties");
d) Wilson performed the Office Duties at the Appellant's home office;
e) Wilson was given signing authority on the Appellant's bank account;
f) the Appellant was in an automobile accident in or about November, 2001;
g) during the Period, Wilson, in addition to the Office Duties; interviewed workers for the Appellant's business, did job estimates and worked with the Appellant's employees on the job site doing window washing, clean up and sales ("Additional Duties");
h) the Appellant set Wilson's rate of pay and increased the rate as the job duties increased;
i) the Appellant requested the use of Wilson's automobile and paid Wilson for the gas;
j) the Appellant provided the necessary office space and equipment to Wilson for the performance of the Office Duties;
k) the Appellant provided the necessary equipment such as the truck, ladders and tools used in the performance of the Additional Duties;
l) the Appellant set Wilson's days and hours of work;
m) the Appellant directed and controlled Wilson in the performance of the Office Duties and the Additional Duties;
n) Wilson did not invest any capital in the Appellant's business;
o) during the Period, Wilson did not incur any expenses in the performance of the Office Duties and the Additional Duties; and
p) Wilson did not work or perform services for anyone else during the Period.
B. THE ISSUE TO BE DECIDED
9. The issue is whether the Appellant employed Wilson in insurable employment during the Period.
[3] All of the assumptions in paragraph 8 of the Reply are correct and were proved in the testimony.
[4] In particular, the Appellant testified that after his accident in November, 2001, he and Judy became partners in his business "Andrew's Innovative Restorations" during the Period. That business replaced, repaired and power washed roofs. The evidence is that this did not happen because:
1. The Appellant testified that he discussed the possible partnership with his lawyer and his lawyer advised him against it and the Appellant did not sign or draw up a partnership agreement because he did not want Judy to share in the assets of the business. (In contrast, the Appellant consistently executed written contracts with customers of his roofing business.)
2. The Appellant testified that instead, he and Judy agreed orally to share the business profits equally. Judy denied this. Judy received about $27,000 during the Period pursuant to her invoices, each of which was prepared on the Appellant's instructions. But on the basis of the Appellant's testimony, he netted profits of over $50,000 in 2002, while Judy received a total of less than $33,000 for 2002 from the business according to the evidence established by the Appellant. Judy denied that any partnership existed and her invoices to and the cheques from that business to her establish that she is correct.
3. Despite the coerced invoices, Judy was really in a contract of employment for Andrew during the Period.
[5] The Appellant also claimed that he needed Judy as a partner because his mind was harmed by the accident and that he was hospitalized in psychiatric care in 2002, so that he could not contract or decide things. (That allegation also goes against the possibility that the Appellant could enter into a partnership contract.)
[6] The evidence established that Judy was an employee of Andrew's Innovative Restorations during the Period. Using the criteria set out in Wiebe Door Services Ltd. v. M.N.R., [1986] 3 F.C. 553, the Court finds:
1. Control
Judy and Cathleen Wormald established that the Appellant is a "control freak" and this was thoroughly confirmed by the Appellant's testimony and conduct in the hearing which lasted more than one and a-half days. The Court believes Judy's testimony that the Appellant told her how to do every aspect of her duties, and phoned her frequently each day and sometimes during most hours of the day directing and detailing her duties. Some of these phone calls during the Period were personal. Her testimony is also believed that the Appellant forced her to invoice for less hours than she worked at the business, when to come to work, what to work at, and often, exactly how to do her work from hour to hour.
2. Ownership of Tools
All of the tools Judy used in her work were the Appellant's. She worked in an office in his home and often drove one of his trucks on the job.
3. Chance of Profit, Risk of Loss
Judy had no chance to profit or risk of loss. She was paid by the hour and in additional received $50, $100 or $150 for each contract she sold to customers. The Appellant insisted that she invoice for her services and reviewed her claims for hours first, sometimes reduced them, and would not put her on an employee withholding payroll; her testimony about this is believed. The Appellant's is not. Indeed, it may be that the Appellant imagined, in his mental condition, that the invoices prevented her from being an employee and confirmed a partnership, but they did not in the circumstances described.
4. Integration
The Appellant was completely integrated into the Appellant's business, first as a bookkeeper and then, during the Period, as a bookkeeper, manager, blue collar roofer and truck driver, all on the direct orders of the Appellant.
[7] In summary, during the Period, Judy was an employee of the Appellant. The appeals are dismissed.
[8] The Intervenor retained a lawyer in respect to these appeals. She is awarded such costs and disbursements as are authorized by the Employment Insurance Act.
Signed at Saskatoon, Saskatchewan, this 31st day of March 2006.
"D.W. Beaubier"
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