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Citation: 2004TCC19
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Date: 20040108
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Docket: 2002-4225(EI)
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BETWEEN:
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NASIB KAUR BAHNIWAL,
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Appellant,
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and
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THE MINISTER OF NATIONAL REVENUE,
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Respondent,
and
SURINDER P.S. MANN,
Intervenor.
Docket: 2002-4226(CPP)
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AND BETWEEN:
NASIB KAUR BAHNIWAL,
Appellant,
and
THE MINISTER OF NATIONAL REVENUE,
Respondent,
and
SURINDER P.S. MANN,
Intervenor.
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REASONS FOR JUDGMENT
Beaubier,
J.
[1] These
appeals were heard together on common evidence at Kelowna, British Columbia on
December 4, 2003. The Appellant testified and called her employer and
son-in-law, Surinder Mann, the intervenor in each case; Judith McAllister,
C.G.A., Mr. Mann's accountant; and Kehar Singh Khaira, an employee of Mr. Mann
during the period. The Respondent called Brian Lundgrun, the
investigations officer for Human Resources and Development Canada
("HRDC") in this matter.
[2] Paragraphs
3 to 8 inclusive of the Reply to the Notice of Appeal set out the matters in
dispute. They read:
3. In response to the
Appellant's appeal of a ruling under section 91 of the Employment Insurance
Act, S.C. 1996 c.23 (the "Act"), the Respondent determined
that the Appellant was not employed by Surinder Mann ("Mann") in
insurable employment during the period from July 29 to October 23, 2000 (the
"Period").
4. In determining that the
Appellant was not employed in insurable employment with Mann during the period,
the Respondent relied on the following assumptions of fact:
a) Surinder Mann
("Mann") operates an orchard at two locations in Oliver, B.C.;
b) Mann operates
his orchard business as a proprietorship;
c) the Appellant
is Mann's mother-in-law;
d) the Appellant
lived with Mann during the Period;
e) the Appellant
received a record of employment from Mann showing a period of employment from
July 29 to October 23, 2000;
f) the
Appellant's record of employment dated October 24, 2000 alleges 730 insurable
hours of employment;
g) Mann's
Earnings and Deductions summary reports prepared on September 29, 2000 and
October 6, 2000 does not record any hours or days worked by the Appellant;
h) the Appellant
did not show up on Mann's Earnings and Deductions summary reports until October
21, 2000;
i) Mann's
records allege the Appellant worked more hours per day than the other workers
during the Period;
j) the
Appellant did not work the number of hours shown on her record of employment;
k) the Appellant
was not employed under a contract of service for the Period;
l) Mann and the
Appellant were in a non arm's length relationship during the Period; and
m) having regard
to all of the circumstances of the employment it is not reasonable to conclude
that Mann and the Appellant would have entered into a substantially similar
contract of employment if they had been dealing with each other at arm's
length.
B. ISSUES TO BE
DECIDED
5. The issue is whether the
Appellant was employed in insurable employment with Mann during the period. In
the alternative, if it is found that the Appellant was employed under a
contract of service with Mann the issue is whether the Appellant and Mann were
dealing with each other at arm's length for the purposes of paragraphs 5(2)(i) and
5(3)(b) of the Act.
C. STATUTORY
PROVISIONS RELIED ON
6. He relied on paragraphs
5(1)(a), 5(2)(i) and 5(3)(b) and subsection 2(1) of the Act, and section
251 of the Income Tax Act.
D. GROUNDS RELIED
ON AND RELIEF SOUGHT
7. He respectfully submits
that the Appellant was not employed in insurable employment with Mann during
the Period as she was not engaged under a contract of service within the
meaning of paragraph 5(1)(a) of the Act.
8. In the alternative, he
submits that the Appellant and Mann were related and that the Appellant's
employment was excluded employment pursuant to paragraph 5(2)(i) of the Act.
He submits that the Appellant and Mann are not deemed to be dealing with each
other at arm's length within the meaning of 5(3)(b) of the Act as the
Minister is not satisfied that, having regard to all the circumstances of the
employment, a substantially similar contract of employment would exist if the
parties had been dealing with each other at arm's length.
[3] Assumption
4 a) is incorrect. Mr. Mann operated a 22 acre fruit (apples, cherries and
peaches) orchard and a 6 acre farm on which he grew tomatoes and peppers.
Assumptions 4 b) subject to the above, c), e), f), g), h), i) and l) were not
refuted by the evidence. Assumption 4 d) is wrong: the Appellant lived on
another property with her widowed daughter, grandchildren and husband. The
remaining assumptions are the subject of the dispute.
[4] At
the outset, the Court finds that the Appellant was employed in a contract of
service by Mr. Mann during the Period. In particular, the Court was convinced
by the testimony of Mr. Khaira who testified that he worked for Mr. Mann
and that the Appellant was a fellow employee during the Period. The Court also
found that the Appellant had an honest demeanour and was credible. She is 65
years old, illiterate and does not speak English. She is also thin, muscular
and in excellent physical condition. She appears to be what she says she is: a
woman who does agricultural field work in season for a living. None of the
Appellant's witnesses testified to the contrary.
[5] The
Appellant worked under the control of Mr. Mann and, like his other employees,
did as he directed or his straw boss directed, working in the fruit orchard or
fields. She did not own any tools, but used the field equipment at hand. Like
the others, she was paid twice a year, by cheque, when Mr. Mann had the money
from sales of fruit and vegetables to pay them. She deposited the cheque in her
own Royal Bank account as recorded in the bank book which she could not read,
but understood that it represented her bank and her money. She was completely
integrated into the field workers and the operation of the farm as an
experienced, working farm hand who came to work with the others and, because
she lived 5 or 6 minutes away, sometimes worked longer than the others.
[6] Pursuant
to the Notice of Appeal and the Federal Court of Appeal's decision in Canada
v. Jencan Ltd., [1998] 1 F.C. 187, paragraph 31, this Court must find if
the Minister: (1) acted in bad faith or for an improper purpose or motive –
there is no evidence of this; or (2) took into account an irrelevant factor –
Appellant's counsel alleged that this did happen on account of anonymous calls
of complaints about the Appellant to HRDC, but there is no evidence that this
had any other effect than to cause the investigation of the Appellant, which
the Court finds was a proper occurrence. Nonetheless HRDC did incorrectly find
that the Appellant resided in Mr. Mann's residence during the Period (assumption
4 d)); or (3) failed to take into account all of the relevant circumstances. It
is these last factors that the Court must review.
[7] The
Appellant initialled a typed form application for employment insurance benefits
dated April 20, 2001. She would not have "signed" or initialled it
since she was in India from the end of October, 2000 until May 18, 2001.
Moreover no exhibited document originating from anyone other than HRDC and
Ms. McAllister was typed or in the pristine condition of the application
(Exhibit R-4). It was exhibited by Mr. Lundgrun. Mr. Lundgrun testified that he
met with Mr. Mann in the course of his investigation and it was confrontational
and terminated quickly. He telephoned the Appellant and arranged an appointment
for her with an HRDC officer who could speak the Appellant's language which the
Appellant did not attend. He first saw the Appellant at this hearing.
[8] Thus,
the Appellant did not meet with HRDC; she is the employer's mother-in-law;
assumptions 4 g), h) and i) were in evidence before HRDC. But assumption 4 d)
is wrong and is a sufficient "factor" to warrant being an assumption,
so it played a part in the decision of the Minister. Moreover, living in the
same household indicates a degree of closeness that may exist. In particular,
the Appellant was asked by Respondent's counsel if she babysat the Mann
children and she stated that she did not and that her widowed daughter cared
for her three children and was assisted by her in-laws.
[9] As
an aside respecting the anonymous calls to HRDC and the questions about
babysitting it might be noted that many would be jealous of Mr. Mann. He
married his wife, who was already resident in Canada, and immigrated to Canada
and worked as a field labourer for years. Then he got a year-to-year lease of
the 22 acre orchard which continues to this day. He has since purchased the 6
acre field farm where he lives with his family. He sells much of his produce in
Vancouver to which he trucks it himself. He has made a remarkable success in Canada
by virtue of hard work. Mr. and Mrs. Bahniwal chose a good son-in-law, so there
might also be jealousy associated with that. In other words, anonymous calls to
HRDC might occur because of something other than the truth.
[10] On the basis of the foregoing finding that Mrs. Bahniwal did not live
in Mr. Mann's residence, the Court finds that the Minister has taken into
consideration a false and irrelevant factor as a result of which this Court may
redetermine the Minister's decision. The evidence before the Court is that
Mrs. Bahniwal was an employee of Mr. Mann and that she worked the hours
described during the Period in question. Therefore the appeals are allowed.
[11] The Appellant is awarded such disbursements and costs as are permitted
by the Employment Insurance Act.
Signed at
Saskatoon, Saskatchewan, this 8th day of January, 2004.
Beaubier,
J.
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