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Dockets: 2002-3407(EI)
2002-4132(EI)
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BETWEEN:
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TERRAQUEST LTD.,
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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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____________________________________________________________________
Appeals heard on common evidence with the appeals of Terraquest
Ltd. (2002‑3408(CPP) and 2002-4133(CPP)) on July 14, 2003 at Toronto,
Ontario
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Before: The
Honourable W.E. MacLatchy, Deputy Judge
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Appearances:
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Agent for the
Appellant:
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Charles Quentin
Barrie
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Counsel for the
Respondent:
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Joel Oliphant
Paolo Torchetti
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____________________________________________________________________
JUDGMENT
The appeals are dismissed and the decisions
and assessments of the Minister are confirmed in accordance with the attached
Reasons for Judgment.
Signed at Toronto,
Ontario, this 19th day of August 2003.
MacLatchy,
D.J.
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Citation: 2003TCC530
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Date: 20030819
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Dockets: 2002-3407(EI)
2002-4132(EI)
2002-3408(CPP)
2002-4133(CPP)
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BETWEEN:
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TERRAQUEST LTD.,
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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
MacLatchy,
D.J.
[1] These
four appeals were heard on common evidence, on consent, on July 14, 2003
at Toronto, Ontario.
[2] The
Appellant appealed a ruling to the Minister of National Revenue (the
"Minister") for the determination of the question of whether or not
David H. Shaver, the Worker, was employed in insurable and pensionnable
employment while engaged by it during the period of January 5 to March 23, 2001
within the meaning of the Employment Insurance Act (the "Act")
and the Canada Pension Plan (the "Plan") respectively.
[3] By
letter dated May 30, 2002, the Minister informed the Worker and the Appellant
that it had been determined that the Worker was employed in insurable
employment during the period in question, pursuant to paragraph 5(1)(a)
of the Act and paragraph 6(1)(a) of the Plan.
[4] Further,
by Notices of Assessment dated May 1, 2002, the Appellant was assessed for
failure to remit employment insurance premiums and Canada Penison Plan
contributions in respect of the workers whose names appear on a list attached
to the Replies to the Notices of Appeal as follows:
Pilots
1) Tony
Deangelis
2) Brian
Harvey
3) Marshall
Makarowski
4) Charles
Matteau
5) Ronald
Melnychuk
6) Williard
Plageman
7) I
Serge Malle
8) David
Shaver
Operators
1) Mikel
Abbot
2) Paul
Beaubien
3) Dave
Brown
4) Mark
Ackerman
5) James
Bursey
6) Kevin
Chapelle
7) Frank
Glass
8) Kevin
Jackman
9) Husam
Samnah
-employment insurance premiums: $4,421.93 and $8,335.01 and for related
penalties and interest for the years 2000 and 2001.
-Canada Pension Plan contributions: $5,652.56 and $4,820.20 and for
related penalties and interest for the years 2000 and 2001.
[5] The
Appellant appealed to the Minister for reconsideration of the assessments and
the latter varied the assessments by letter dated September 10, 2002.
[6] The
evidence presented to this Court was given by Charles Barrie on behalf of he
and his brother, the sole owners of the Appellant. His presentation exhibited
his clear understanding of the reasons behind the decisions made by the
Respondent. He was candid and cooperative throughout his testimony and he
accepted the assumptions made by the Minister upon which he based his
decisions. Those assumptions were clearly set forth in paragraphs 4(a) through
(gg) of the Reply to the Notice of Appeal in file 2002-4132(EI).
[7] Mr.
Barrie, on behalf of the company, immediately changed the status of the subject
workers from what it assumed was a position of independent contractors to that
of employees when notified of the decisions of the Minister. The Appellant had
accepted advice to the contrary from its accountants prior to the notices of
assessment and did not knowingly attempt to avoid any consequences of its
earlier decisions. This display of candour and cooperativeness was refreshing
to this Court.
[8] The
Appellant was of the opinion that such things as the penalties and interest
included in the assessments were unfair and inequitable in these circumstances.
It was pointed out to the Appellant that this Court does not have equitable
jurisdiction and could not arbitrarily set these items aside. A strong
recommendation is made to the Minister that he might consider a further reassessment
in this regard to avoid any punitive connotation.
[9] The
classical tests of control, ownership of tools, chance of profit and risk of
loss with the further consideration of integration all supported the clear
evidence that the workers were operating pursuant to contracts of service and
were in a relationship of employee/employer with the Appellant. This was
accepted by the Appellant through the admissions of Charles Barrie. The
workers' employment was both insurable and pensionable.
[10] The appeals are hereby dismissed, the decisions of the Minister and
the assessments are confirmed.
Signed at
Toronto, Ontario, this 19th day of August 2003.
MacLatchy,
D.J.
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