[OFFICIAL ENGLISH TRANSLATION]
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Reference: 2004TCC60
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Date: 20040203
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Docket: 2002-4643(EI)
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BETWEEN:
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JEAN-GUY BRIDEAU,
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Appellant,
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And
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THE MINISTER OF NATIONAL REVENUE
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Respondent.
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REASONS FOR JUDGMENT
Savoie, D.J.
[1] This appeal was heard at Bathurst,
New Brunswick, on October 1, 2003.
[2] This is an appeal of the
insurability of the Appellant's employment when working for Lydia
Savoie, the Payer, during the period in question, from October
28, 2001, to December 1, 2001.
[3] The Minister of National Revenue
(the "Minister") informed the Appellant of the decision that his
employment was not insurable for the period in question since he
did not meet the requirements of a contract of service.
[4] The Minister's decision was based
on the following assumptions of fact, set out in paragraphs 7 and
8 of the Reply to the Notice of Appeal, admitted, denied or
ignored by the Appellant:
7.(a) the Payer purchased Christmas
wreaths ("wreaths") that were handmade by different people,
including the Appellant; (admitted)
(b) the Payer resold
the wreaths to an export company working under the name Savoie
Export Limitée; (ignored)
(c) the Payer did
not know the Appellant's hours of work; (admitted)
(d) the Payer did
not supervise the Appellant; (admitted)
(e) the Payer had no
control over the number of wreaths the Appellant made;
(ignored)
(f) on the
Appellant's invoices, the Payer indicated a price of $15.00 per
dozen for the Appellant's wreaths; (admitted)
(g) the Appellant
produced two dozen wreaths per day; (admitted)
(h) the Appellant
did not receive the $2,486.00 indicated on the employment record
issued by the Payer; (admitted)
(i) the
Appellant did not work 300 hours as indicated on the employment
record issued by the Payer; (ignored)
(j) there was
no contract of service between the Appellant and the Payer;
(ignored)
8.(a) the following is from the
invoices prepared in the Appellant's name: (ignored)
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dates
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number of wreaths
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total amount
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October 29
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23 doz.
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$345.00
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November 3
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10 ½ doz.
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$157.50
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November 9
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4 ½ doz.
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$67.50
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November 9
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28 doz.
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$428.00
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November 12
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2 ½ doz.
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$37.50
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November 14
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27 ½ doz.
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$412.50
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November 16
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3 doz.
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$45.00
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November 22
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6 doz.
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$90.00
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November 24
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27 doz.
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$405.00
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November 26
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27 ½ doz.
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$412.50
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November 30
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6 doz.
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$90.00
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Total
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165 ½ doz.
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$2,482.50
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(b) the Appellant
did not receive any wages for the wreaths that he made;
(admitted)
(c) the invoices in
the Appellant's name do not reflect the number of wreaths the
Appellant made during the period in question; (admitted)
(d) the period in
question is 34 consecutive days; (admitted)
(e) the Appellant
allegedly produced no more than 68 dozen wreaths during the
period in question, that is, 2 dozen per day for 34 days, at 7
days a week, with no interruptions; (admitted)
(f) at $15.00
a dozen, the Appellant would have earned $1,020.00 at most for
the period in question; (admitted)
(g) the Appellant's
and the Payer's contributions to employment insurance and
pension, along with the income tax deductions indicated on the
Appellant's T-4 came to a total of $736.45; (ignored)
(h) the Appellant
made wreaths in exchange for a record of employment for $2,486.00
and 300 hours; (admitted)
(i) the
arrangement between the Appellant and the Payer was not a
contract of service. (denied)
[5] The evidence established the
following facts:
[6] The Payer did not know what the
Appellant's hours of work were and did not give him any
directives as to how to perform his duties. She did not determine
his work schedule. The Appellant chose his own work schedule and
decided how many hours he would work.
[7] The Appellant was not supervised
at all. The Payer was only interested in the end product, the
result of the work, regardless of the method used.
[8] Moreover, the Appellant had his
own workplace and the Payer did not pay any rent for its use nor
did she reimburse any expenses for heating or electricity. The
Payer did not provide the Appellant with any tools to carry out
his duties.
[9] According to the evidence, there
was no relationship of subordination between the Payer and the
Appellant, an essential element of all contracts of service. The
Payer had no control over the Appellant, who worked as he liked
and provided his own workplace and tools, other important
elements of a contract of service.
[10] The evidence showed that this case is
one of a number of others that led Human Resources Development
Canada (HRDC) to investigate, after having received insurability
applications. As many other workers hired by the Payer to make
Christmas wreaths, the Appellant sold his wreaths to the Payer in
exchange for forged employment records to justify employment
insurance benefits.
[11] The Payer was penalized by HRDC for the
fraud committed.
[12] It was established that the Appellant
made wreaths and delivered them to the Payer with an invoice. In
return, the Payer settled the invoice with a cheque, which the
Appellant would cash in and then he would give the cash to the
Payer. The Appellant and his spouse admitted to this arrangement
during their testimony in court.
[13] Contrary to other cases, the evidence
produced by the Appellant seemed true. The Appellant did not try
to hide the facts or present a version that would exonerate him,
as he tried to do with the investigators.
[14] In the present case, the answer to the
insurability question can be found in paragraph 5(1)(a) of
the Employment Insurance Act, which states:
5.(1) Subject to subsection (2), insurable employment is:
(a)
employment in Canada by one or more employers, under any express
or implied contract of service or apprenticeship, written or
oral, whether the earnings of the employed person are received
from the employer or some other person and whether the earnings
are calculated by time or by the piece, or otherwise;
...
[15] The Appellant admitted to most of the
Minister's presumptions. As for the statement at paragraph 8(i)
of the Reply to the Notice of Appeal, he denied it, but did not
provide any evidence to prove it was false. The Minister claimed
that an arrangement between the Appellant and the Payer
invalidated the contract of service. This presumption was proven.
It must be noted again that the Appellant did not present any
evidence to refute the presumptions that he chose to ignore.
[16] The Appellant had the onus of proving
that the Minister's presumptions were false. He did not do so. As
the Federal Court of Appeal found in Elia v. Canada
(Minister of National Revenue-M.N.R.), [1998] F.C.J. No. 316,
the Minister's presumptions should be considered accepted unless
they have been specifically refuted by the Appellant.
[17] It is important to note that in the
present case, it was proven that the Appellant did not receive
any wages for the services rendered to the Payer. This would
nullify the concept of insurable employment as defined under
paragraph 5(1)(a) of the Employment Insurance Act,
supra.
[18] The present case is simple: it is
similar to Kelly v. M.N.R., [1989] No. 109 in which
this Court, per Labelle J., wrote:
[translation]
The Court finds that the Appellants do not qualify for
unemployment insurance benefits because they were never paid for
the work they performed. The Appellants all worked the exact
number of weeks they needed to receive unemployment insurance
benefits. Although they worked, they were never paid. In exchange
for their work, the employer gave them false employment records
that allowed them to receive unemployment insurance benefits. The
Court finds that the employment of each of the appellants was not
insurable employment because the Appellants did not receive any
wages. For these reasons, the Court confirms the Minister's
decisions and dismisses the appeals.
[19] As a result, this Court must find that
during the period in question, the Appellant did not have
insurable employment with the Payer since there was no real
contract of service within the meaning of paragraph
5(1)(a) of the Employment Insurance Act. Moreover,
the Appellant and the Payer had an arrangement between themselves
in order to qualify the Appellant for employment insurance
benefits.
[20] For the reasons set out above, the
appeal is dismissed and the decision of the Minister is
confirmed.
Signed at Grand-Barachois, New Brunswick, this 3rd day of
February 2004.
Savoie, D.J.
Certified true translation
Manon Boucher
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