Date: 20011109
Dockets:
2001-478-EI,
2001-479-CPP
BETWEEN:
LARRY W.
ELENIAK,
Appellant,
and
THE MINISTER OF
NATIONAL REVENUE,
Respondent,
and
COOL-IT AUTO SERVICES
LTD.,
Intervenor.
Reasonsfor
Judgment
Rowe,
D.J.T.C.C.
[1]
The appellant appeals from decisions issued by the Minister of
National Revenue (the "Minister") on January 18, 2001
pursuant to subsections 93(3) of the Employment Insurance
Act (the "Act") and 27(1) of the Canada
Pension Plan (the "Plan"), respectively,
wherein the Minister decided the appellant was not engaged in
insurable or pensionable employment with the intervenor (Cool-It)
during the period October 22, 1999 to January 7, 2000. The
appellant filed a separate appeal - 2001-479(CPP) - and all
parties agreed the result in the within appeal would apply.
[2]
Larry Eleniak testified that he first came into contact with the
intervenor when having the air conditioning in his car repaired
at a Cool-It shop. He entered into a discussion with the manager
and in the course of their conversation the appellant mentioned
that he was an experienced marketer. The manager referred him to
Steve Zaeri at the main office of Cool-It in downtown Vancouver,
British Columbia. The appellant stated he contacted Zaeri
and later met with him and four other people at a restaurant. He
understood they were interested in participating in a buying
cooperative since only three shops used the Cool-It trade name
and two others operated under a different name. Eleniak stated
the result of the meeting was that he was hired to carry out
marketing for each shop/outlet but was to make arrangements with,
take direction from, and be under the supervision and control of
Zaeri. Initially, the discussions with the group had been on the
basis he would travel from one business to another in the course
of carrying out a marketing strategy. However, as matters
progressed, the appellant stated he worked about 70% of the time
at the intervenor's downtown location - where he had
the use of an office equipped with desk, couch, computer, fax
machine, telephone and supplies - and devoted the remainder
of his work to other locations in Burnaby and Richmond. While his
main function was to market the business of the group members and
handle outside sales, he stated he also picked up - from
various locations - radiators which were to be repaired by
Cool-It. In addition, the appellant stated he answered the
telephone and provided customers with quotations. The
intervenor's business was to provide sales and/or service
for air-conditioning systems and radiators of all sorts
pertaining to motor vehicles. The appellant stated he was
promised a salary of $2,750 per month together with car expenses,
a commission on new business, and health plan coverage for
himself and his wife which was extremely important to him since
this benefit had been available to him at his previous
employment. Apart from working at the Cool-It downtown office,
Eleniak stated he also worked from his own home attempting to
assist Zaeri's brother to emigrate from Iran to Canada and
this required several communications to Teheran. He was
reimbursed - in cash - every two weeks for car
expenses. He also received a pay cheque dated November 9, 1999 -
in the sum of $1,000 - and noted there were no deductions taken
off and he never saw any document or pay slip for that cheque or
the others he received during the course of his working
relationship. Prior to assuming his responsibilities with
Cool-It, Eleniak had worked - as an employee - at Data Wave
Computer Services for 19 months. At his own residence, he
had a computer and work station with fax and internet connection.
He stated he decided to leave his employment at Data Wave in
order to earn an higher income at Cool-It. On one occasion while
working late, Eleniak stated an insurance agent arrived and he
spoke with her about auto insurance premiums and also about
joining the Cool-It employment benefits health care package
currently in force. He stated the agent left the Cool-It premises
for a brief period - probably to find certain documents in
her vehicle - and returned with certain forms which he completed
indicating therein that his salary was in the sum of $2,750 per
month and naming himself and his wife as persons to be covered by
the plan. At this time, Eleniak stated Zaeri was present in the
office and was aware of his desire to enroll in the
intervenor's health care plan which he understood was
applicable to 6 workers at the downtown location, 4 others in
Burnaby and two in Richmond. Later, on January 7, 2000, Eleniak
suffered health problems and attended at the hospital on an
emergency basis. He received a quadruple bypass and the leg from
which the vein was stripped did not heal so he remained in
hospital until the end of that month. In February, he stated he
went with a friend to the intervenor's downtown office at
which time certain invoices were presented to him by Joyce
Bradford - Office Manager - and he was asked to sign
them even though they represented amounts for which he had
already been paid and the explanation provided to him - by
Bradford - was that the intervenor's accountant had
requested it. The purpose of his visit to Cool-It had been to
request the balance of the money he believed was owing to him, as
calculated on the basis of $2,750 per month. However, he was
informed by Bradford that he owed Cool-It money as a result of
having received a series of advances. Returning to a description
of the services provided by him to the intervenor during the
relevant period, the appellant agreed the Reply to the Notice of
Appeal (Reply) set forth his duties as it pertained to
establishing a common purchasing plan to reduce the cost of parts
and to set up a common inventory and billing program. In
pursuance of a marketing plan, the appellant stated he prepared a
diskette containing a price list of parts according to the format
requested by the Insurance Corporation of British Columbia
(ICBC) and also provided that corporation with a background paper
concerning the operators of each shop - within the group - and a
description of their experience in the radiator and air
conditioning business. The intervenor and other members of the
cooperative wanted to develop a relationship with ICBC and also
with Canadian Direct Insurance. The system for repair is based on
all body shops having a vendor list containing the names of
businesses which are able to provide the necessary product at
prices approved by ICBC and it is extremely important for those
auto repair shops to be aware of the existence of a business such
as Cool-It and its associates. In return, the intervenor and
others in the group would be required to perform satisfactory
work while matching - or beating - the price on the
approved list for certain parts used in the course of the body
work. Eleniak explained the process of obtaining approval from
ICBC - in order to be added to a vendor's list - was slow
and had not yet been accomplished when he became ill. He prepared
some Yellow Pages advertising for the Cool-It business group and
Zaeri had been able to purchase parts - using the Burnaby
outlet - for all 5 shops in order to obtain a price discount
attributable to increased volume of purchases. In addition, the
appellant stated he held discussions with Steve Zaeri's
brother - Maj - about exporting a special paint as well as
exploring ways to expand the intervenor's business
operations into the United States and elsewhere in Canada. In
carrying out the various tasks, Eleniak stated he would arrive at
the downtown office at 8:30 a.m. and use his key and access code
to gain entry to the premises. He would place the appropriate
sign out on the sidewalk and then begin answering the telephone
and responding to customers. On occasion, he would use his own
vehicle to pick up radiators needing repair or would deliver a
repaired unit or pick up parts at a local warehouse. He had his
own cell phone and would receive calls from Zaeri or someone else
at Cool-It or would merely perform the tasks on a list provided
to him by Zaeri. In February, 2000, the appellant applied for
Employment Insurance (EI) benefits and also received a cheque -
for one month's benefit - from the insurance carrier
providing health plan coverage to the intervenor. However, after
issuing that one cheque, the insurance company refused to make
further payments to him. Since he was unable to work due to the
state of his health - a situation which persisted for
nearly a year - he applied for social assistance and later
received EI benefits, the eligibility for which he attributed to
his employment at Data Wave - for 18 months - prior to starting
at Cool-It.
[3]
In cross-examination by counsel for the respondent, Larry Eleniak
stated Steve Zaeri had provided him with a list of work to be
performed and - on occasion - gave him oral instructions to
attend at a certain place to pick up items or to make a delivery
to a specified address. He stated he had not anticipated having
to perform these mundane tasks but discovered that nearly 60% of
his working day was spent in this manner rather than doing work
on the computer or pursuing the marketing initiative. Originally,
he had seen himself as a sales representative but later used the
title of General Manager to describe his duties and had business
cards printed up accordingly. He had seen his role within the
business group as one in which he was mandated to develop
markets. In that sense, the appellant explained he was well
qualified since he had owned his own insurance agency for 7 years
and had worked for an airline as well as having been engaged in
marketing certain products overseas. He carried out his work from
an office - upstairs in the Cool-It building - that had
formerly been occupied by Zaeri. While no specific working hours
were set, he understood that he should be there in the morning to
work, as required, from Monday to Friday and he also attended at
the office for part of a day each Saturday. The appellant was
referred to copies of cheques paid to him by the intervenor
(Exhibit R-1). He agreed he received three cheques during the
month of November, 1999; one was in the sum of $1,000 and
two others were in the sum of $500. During the month of
December, 1999 he received 3 cheques - each in the sum of
$500 for a total of $1,500 - and he was paid the sum of
$250 by means of a final cheque dated January 6, 2000. All
cheques were deposited into his personal bank account and at the
time they were issued to him he does not recall having been aware
of the presence of any writing describing the payments variously
as "contract on sales", "sub contract on
sales", "sub contract on marketing" or
"marketing sub contract". The procedure was to
obtain a cheque - usually at the end of a working day
- directly from Zaeri who would fill in the amount. The
appellant was also referred to a series of invoices -
Exhibit R-2 - and he explained these were signed by him
- at the request of Joyce Bradford - when he had
attended at the Cool-It premises in February, 2000. He reiterated
he had made it clear to Zaeri that he already had an excellent
health plan with his existing employer and wanted similar
coverage if he decided to work for Cool-It. He stated Zaeri
agreed that would not be a problem since there was a corporate
health plan already in place with an insurer. Eleniak identified
the health plan application form - Exhibit R-3 - and
agreed he had inserted the date of October 1, 1999 as the
commencement date for his employment at Cool-It. He recognized
the submission for the telephone directory listing for 5 shops
- Exhibit R-4 - in which he had set forth the
name of Charterhouse International Projects Inc. (Charterhouse)
as the entity responsible for preparing said listing and the
appellant's home address, telephone number, fax number and
cell number were included. Eleniak stated the corporation had
been used by him previously in order to market certain
construction projects but it had been struck from the provincial
corporate registry due to inactivity. Eleniak was referred to two
invoices - both dated January 8, 2000 - Exhibit R-5 - on
the letterhead of Charterhouse - directed to Cool-It for
various services rendered from December 28 to 31, 1999 and also
for certain expenses incurred between December 31, 1999 and
January 6, 2000. The appellant stated he did not recall having
prepared those invoices and believed his wife may have done so
since he was ill and had begun to experience symptoms of heart
trouble the previous day, following which he attended at the
Emergency Department of Abbotsford Hospital.
[4]
In cross-examination by Joyce Bradford - agent for the
intervenor - Eleniak stated he did not recall having told
her that he owned several companies and had used them in the
course of business in order to take advantage of certain tax
write-offs. He also stated he did not recall having been informed
by Bradford that he had to be on the payroll of Cool-It for at
least 3 months in order to become eligible to participate in the
health plan policy. He agreed Bradford had refused to provide him
with a Record of Employment on February 18, 2000 to which he had
responded by telling her "things could be difficult".
He agreed Cool-It had done some repairs on his car - without
charge - in recognition of the fact he used his vehicle in the
course of his work.
[5]
Steve Zaeri testified he arrived in Canada in 1991 and started
his own business the following year. He wanted to expand the
operation and he and his brother - Maj - and three
other individuals met with the appellant - at a Vancouver
restaurant - and discussed business development and marketing.
Zaeri stated that in the course of the meeting, the appellant
advised the group he had operated his own company for years and
had extensive business experience in Canada and overseas. Since
all participating members of the group were involved in the
radiator and air conditioning business, they were interested in
the concept proposed by the appellant. However, they were not
willing to pay - as a collective - more than $500 per week
for his services rather than the sum of $2,750 per month he had
requested. The corporation - Cool-It - owned one
outlet in Vancouver and another in Burnaby but the outlet
operating under the Cool-It name in Richmond was owned by Rick
Easch and there was no financial connection between that business
and the ones owned by Zaeri but Easch had been given permission
to use the trade name. Two other shops, one in Port Moody
and another in North Vancouver operated under their own trade
names. Cool-It operated an outlet in downtown Vancouver and Zaeri
stated Eleniak liked to use the office located in that premise.
Zaeri stated the appellant did not attend at the shop in Richmond
and came up with excuses for not visiting the other outlets owned
by the individuals who had attended the business meeting. As for
picking up and/or delivering parts and/or repaired radiators,
Zaeri stated that if Eleniak happened to be going in a particular
direction for some purpose or other he would offer to carry out
an errand for Cool-It because he wanted to use the opportunity to
make contact with the proprietor or manager of that business for
purposes of a sales call in connection with his efforts to expand
the business. Zaeri stated the only people working at the
downtown outlet who were permitted to discuss prices with
customers were himself, his nephew - Pedro - and
Dave, a mechanic. Otherwise, any worker answering the telephone
was instructed to put the caller on hold until he, Pedro or Dave
could attend to the call. Zaeri stated that the concept of
developing a working group - engaged in the same sort of
business - could produce increased profit for the members
due to their ability to obtain a rebate flowing from an increased
volume of purchases. As for obtaining reimbursement from other
members of the group towards paying for Eleniak's services,
Zaeri stated only one person paid his share.
[6]
In cross-examination by counsel for the respondent, Steve Zaeri
stated he had not assigned an office to the appellant but
permitted him to use the chair, desk and computer in an existing
office because Eleniak had advised that his own home computer was
not functioning. Zaeri stated he and the members of the business
group did not care where the marketing work was carried out but
the five member-outlets wanted Eleniak to devote 40 hours per
week to that task. Zaeri agreed he had requested Eleniak
communicate with the Canadian Embassy in Teheran in order make it
clear that Zaeri was operating a viable and established business
in Vancouver and was not merely operating a one-man shop. Some
telephone calls were made from Eleniak's home and he was
reimbursed for the cost. Eleniak was also provided with a key to
the Cool-It premises in order to make calls from that location as
there is a 12-hour time difference between Vancouver and Teheran.
Zaeri stated he dealt with Eleniak on the basis that they were
friends. The Cool-It shop repaired the appellant's car
without charge and - on occasion - Zaeri gave Eleniak
a ride to work and they would eat lunch together. During one
conversation with the appellant, Zaeri mentioned he had spoken
with a sales manager at an automotive supply store about
reflective paint. Zaeri stated Eleniak had informed him that he
had a friend who could manufacture that product but nothing
further came of it. Zaeri had observed that some of the marketing
work done by the appellant seemed to be paying off as Canadian
Direct Insurance telephoned Cool-It on 5 or 6 occasions and
some business was obtained as a result. Zaeri stated he knew it
was not going to be an easy task to obtain work from
ICBC-approved body shops and was aware it might take up to 6
months in order to be included into that corporate system for
purpose of becoming an approved vendor of parts and service. To
that end, Zaeri and other members of the business group
considered Eleniak's sole responsibility to be a marketer
of their products and service in an effort to increase sales. In
the past, Zaeri had done his own sales work but had been willing
to have Zaeri contact ICBC and other insurers because he did not
feel comfortable dealing with their senior officials and
managers. Zaeri explained his long-standing practice - as
an employer - is to explain to workers exactly what is expected
of them. The only instructions he passed on to the appellant was
to attend at a specific area where there was a substantial number
of body and repair shops and advised him to avoid making sales
calls at certain businesses that were slow in paying outstanding
accounts to Cool-It. Zaeri expected the appellant to acquire a
minimal knowledge of radiators and air conditioning systems so he
could relate to potential customers. In addition, he wanted
Eleniak to provide information concerning sales calls made by him
and to note the reason potential customers had decided not to
deal with Cool-It. However, the information was never provided by
Eleniak. By contrast, the marketing company currently handling
the Cool-It account delivers detailed information on a regular
basis concerning efforts made - and responses received - to
marketing campaigns. While there was no set working schedule set
for the appellant, Zaeri stated he wanted a brief report twice a
day on the activities being carried out. Although there was no
discussion about the matter prior to starting work as a marketing
consultant to the Cool-it group, Zaeri stated the appellant later
mentioned that he wanted extended health coverage. However, Joyce
Bradford explained to Eleniak that he had to be a person who had
been on the Cool-It payroll for a period of 3 months. In
response, Eleniak requested the insurance agent for the health
plan carrier attend at the Cool-It premises. Zaeri stated he was
present when the agent and Eleniak were discussing the insurance
matter but had to leave after only a few minutes. Zaeri stated he
thought Eleniak was enrolled in the Cool-It plan but -
later - was advised the insurance company issued only one cheque
as a disability payment to the appellant and then refused to make
any further payments. Initially, Zaeri had expected the appellant
would pay his own expenses since he was apparently operating his
own corporation. Eleniak requested that Cool-It issue cheques to
him personally since his company name was based on his own name
and, therefore, it would not make any difference.
[7]
In cross-examination by the appellant, Zaeri acknowledged that
5,000 entries had to placed into a computer file in order to
prepare for the submission to ICBC. Zaeri pointed out that the
Cool-It computer was also used by the appellant for personal
matters and denied the suggestion that the business group had
agreed to pay the sum of $2,750 per month for the
appellant's marketing services.
[8]
Dorothy Van der Ree testified she is employed as the Risk
Services Coordinator for Federated Insurance Company of Canada
(Federated) which provides property, casualty and insurance
benefits to employees. On November 24, 1999, she met with the
appellant at the Cool-It office, after having been introduced to
him by Steve Zaeri who had identified him as a person involved in
marketing for the Cool-It business group. Zaeri left the
office and discussions continued with Eleniak who then informed
her that he was actually the General Manager of Cool-It and
requested an application form in order to apply for inclusion in
the health plan. She did not have the appropriate document with
her but faxed it to him from her office the next day and he
completed it and returned the form to her on November 26, 1999.
Since he had described himself as General Manager on the
application form - Exhibit R-3 - she assumed he would
be an employee of Cool-It. She stated she would never have taken
it upon herself to suggest to Eleniak that the description of his
duties at Cool-It would be "more like that of a General
Manager" as it was not her function to offer that
advice.
[9]
In cross-examination by counsel for the respondent, Dorothy Van
der Ree agreed she had received a copy of the letter -
Exhibit R-6 - dated February 23, 2000 informing the
appellant that no further short term disability benefits would be
paid to him since he did not qualify as an eligible employee as
defined by the insurance policy. The Proof of Claim -
Exhibit R-7 - dated January 12, 2000 - submitted by the
appellant to Federated - refers to symptoms having been
experienced by him in November, 1999. She stated that in order
for someone to be covered by the insurance policy in force for
Cool-It, the premiums for an individual must be deducted at
source in the same fashion as other usual deductions for an
employee.
[10]
In cross-examination by the appellant, Dorothy Van der Ree agreed
there would probably be a small discount available for the 5
participating businesses in the Cool-It marketing group if they
chose to have Federated handle all their insurance requirements.
In response to a suggestion by Eleniak to that effect, she stated
she had not used the term - General Manager - in
relation to his duties at Cool-It. However, she later accepted
his own description to that end and when policies were issued she
reviewed them - with the appellant - on the basis he was an
employee of Cool-It holding that specific title. She stated no
premium had ever been paid by - or on behalf of - the
appellant in relation to his purported enrolment in the existing
health plan. Although Federated did issue one cheque to Eleniak
following receipt of the proof of claim, the company then
declined coverage but did not bother to take any action to
recover the amount of the disability payment that had been sent
to the appellant.
[11]
The appellant submitted that he had been offered a job as a
marketer at a salary of $2,750 per month after having initially
requested the larger amount of $3,300 per month. He pointed out
he had been reimbursed - in cash - for car expenses
and stated he would never have changed employment had he been
aware he would not be an employee of Cool-It and entitled to
whatever benefits would flow from that status, including
enrolment in a health plan.
[12]
Counsel for the respondent submitted the evidence of the
appellant was not credible and was an attempt to create an aura
of employment so that - for ulterior motives - he
could be seen as an employee of Cool-It - from the
beginning - rather than as an independent contractor providing
marketing services. Counsel submitted that certain tasks or
errands were done by Eleniak out of friendship - as a
favour to Zaeri - but there were no specific requirements
for him to answer telephones or to carry out routine tasks at the
shop. By way of contrast, counsel submitted it was clear Zaeri
and his group were interested in results and wanted to see an
increase in sales and profits as a result of having formed a
business alliance. Counsel suggested the evidence in the within
appeal was consistent with an independent contractor relationship
that had turned sour after the appellant suffered serious health
problems since - at all material times - the appellant had
held himself out as an experienced entrepreneur operating his own
business through a corporation.
[13]
In Wiebe Door Services Ltd. v. M.N.R.,
[1986] 2 C.T.C. 200, the Federal Court of Appeal approved
subjecting the evidence to the following tests, with the
admonition that the tests be regarded as a four-in-one test with
emphasis on the combined force of the whole scheme of operations.
The tests are:
1. The control test
2. Ownership of tools
3. Chance of profit or risk of loss
4. The integration test
Control:
[14]
The evidence of the appellant that he was required by Zaeri to
answer the telephone, take out the sign in the morning and run
errands by picking up and delivering certain items in the regular
course of the radiator and air conditioning business is not
credible. He knew nothing of the business and would definitely
not be the one to answer the telephone and provide advice and
quotations to potential customers concerning their automotive
cooling and heating problems. Zaeri and the others in the group
wanted to expand the scope of their business and to improve their
buying power on parts as a result of banding together for those
limited purposes. Toward that end, they retained the appellant to
create a common purchasing plan and to set up a common inventory
and billing program. Initially, the appellant was to spend one
week per month at each location in pursuance of the marketing
strategy and would be reimbursed at the rate of $500 per week.
Zaeri gave the appellant some advice and direction as to
appropriate businesses to call on - or to avoid - and
wanted some feedback on a regular basis as to where he had been
and what results - if any - were flowing from the
calls. He also suggested Eleniak acquire a limited knowledge of
the Cool-It business so he could properly discuss the services of
the business group when approaching potential customers. Zaeri
was aware the process of becoming included on the approved
vendors list utilized by ICBC at body repair shops was a
long-term proposition and the appellant was left on his own to
achieve that end. Any so-called control or supervision as it
applies to an employee existed only as a figment of the
appellant's imagination - much like his self
promotion to the title of General Manager - and did not
flow from Zaeri. With regard to this particular test, it points
to the status of independent contractor.
Tools:
[15]
The appellant was able to use the computer and office at the
downtown Cool-It location but he also performed some work on his
own computer at home in his own equipped office. He used his own
motor vehicle and cell phone. He was supposed to attend at the
other businesses on a regular basis but chose to remain at the
comfortable downtown office. In the circumstances, this test is
not particularly significant but it still - on balance -
supports the characterization of the appellant as an independent
marketer operating on his own account.
Chance of
profit or risk of loss:
[16]
The appellant entered into the arrangement with the Cool-It
business group and the remuneration for his services was arrived
at by the process of negotiation. He wanted to be paid the sum of
$2,750 per month and Zaeri and the others in the group refused to
accept that proposition. They countered with the offer to pay him
the sum of $500 per week for his marketing services and the
payments made to him - commencing November 8, 1999 and continuing
until January 6, 2000 - were calculated on that basis. There was
no suggestion the appellant was required to devote his full time
and efforts exclusively to Cool-It and the others in the group
but they did expect him to devote 40 hours per week to their
project. His own invoices - Exhibit R-5 - indicate he
was purporting to carry on business as a corporation -
Charterhouse - and this is consistent with the initial
representations he made to the business group - when attempting
to sell his marketing expertise - that he was an
experienced entrepreneur accustomed to operating his own business
through a privately-owned corporation. It is to be assumed that
any professional person undertaking to deliver a particular
service for a specified fee has done his or her homework and is
reasonably satisfied the revenue from that piece of work will
either turn a profit - in itself - or is being
adequately compensated for within the larger picture of an
ongoing business over a longer term. It is not unusual for
persons delivering a specific service - not directly connected
with the principal function of a business - to do so on the basis
of a specified regular fee or retainer. The appellant was well
aware he would be providing services to a group composed of 5
separate businesses and that each member would be contributing
money in payment of his weekly fee in order to obtain benefit
from his marketing expertise. With respect to this test, I find
it favours the status of entrepreneur.
Integration:
[17]
This test is one of the most difficult to
apply. At page 206 of his judgment in Wiebe, supra,
MacGuigan, J.A. stated:
Of course, the organization test of Lord
Denning and others produces entirely acceptable results when
properly applied, that is, when the question of organization or
integration is approached from the persona of the
"employee" and not from that of the
"employer," because it is always too easy from the
superior perspective of the larger enterprise to assume that
every contributing cause is so arranged purely for the
convenience of the larger entity. We must keep in mind that it
was with respect to the business of the employee that Lord Wright
addressed the question "Whose business is
it?"
Perhaps the best synthesis found in the
authorities is that of Cooke, J. in Market Investigations,
Ltd. v. Minister of Social Security, [1968] 3 All. E.R. 732
at 738-39:
The observations of Lord Wright, of Denning
L.J., and of the judges of the Supreme Court in the U.S.A.
suggest that the fundamental test to be applied is this: "Is
the person who has engaged himself to perform these services
performing them as a person in business on his own account?"
If the answer to that question is "yes," then the
contract is a contract for services. If the answer is
"no" then the contract is a contract of service. No
exhaustive list has been compiled and perhaps no exhaustive list
can be compiled of considerations which are relevant in
determining that question, nor can strict rules be laid down as
to the relative weight which the various considerations should
carry in particular cases. The most that can be said is that
control will no doubt always have to be considered, although it
can no longer be regarded as the sole determining factor; and
that factors, which may be of importance, are such matters as
whether the man performing the services provides his own
equipment, whether he hires his own helpers, what degree of
financial risk be taken, what degree of responsibility for
investment and management he has, and whether and how far he has
an opportunity of profiting from sound management in the
performance of his task. The application of the general test may
be easier in a case where the person who engages himself to
perform the services does so in the course of an already
established business of his own; but this factor is not decisive,
and a person who engages himself to perform services for another
may well be an independent contractor even though he has not
entered into the contract in the course of an existing business
carried on by him.
There is no escape for the trial judge, when
confronted with such a problem, from carefully weighing all of
the relevant factors, as outlined by Cooke, J.
[18]
The evidence disclosed the appellant to have had no significant
working knowledge of the radiator or air conditioning business as
it pertained to motor vehicles. He would not have been able to
offer any skills to Cool-It - or the others in the business group
- in that regard. He held himself out to be a skilled marketer
who could increase the market share of an affiliated group and as
someone capable of organizing a central system that would permit
cost efficiencies to occur as a result of increased buying power
or by placement of insurance coverage with one insurer. No one
had performed that function prior to his arrival on the scene
and, following his departure, an independent professional
marketing service took over the Cool-It account. The manner in
which the appellant presented himself and his subsequent working
behaviour was wholly consistent with a self-employed individual
carrying out a specific task with a view to achieving a
particular objective during the course of efforts expended during
a period not limited by a specific deadline. Zaeri - on
behalf of Cool-It - and as spokesman for others in the
business group, was not an individual experienced in marketing
even though he had previously done his best to expand his
business by making personal contacts with persons in the body
shop industry. The service provided by the appellant was
collateral to the operations of Cool-It and its business
associates and was intended to enhance the scope of existing
operations in an effort to increase revenue and - to some
extent - decrease the overall cost of purchasing parts and
other products. The appellant had represented to the group that
he was well experienced in the marketing field and had the means
to deliver the service. His subsequent conduct was consistent
with that posturing and the fact he purported to operate through
his own corporation bears that out. Many consultants carry out
their tasks at the offices of clients using the equipment in
place on the premises. The invoices
- Exhibit R-2 - signed by the
appellant confirmed he was being paid for having supplied
marketing services. The fact they were prepared by Joyce Bradford
at Cool-It is not significant since the relationship at that
point had come to an end and it was important to have an invoice
to cover each cheque that had already been issued to the
appellant by Zaeri. Again, this test favours a finding that the
appellant was an independent contractor.
[19]
I am aware it is important to consider what was actually done by
the worker during the course of the working relationship rather
than to accept that which was intended at the outset. However,
the evidence of the appellant is not credible when assessed in
relation to the evidence of other witnesses and where there is a
difference on a particular point arising from the testimony of
Eleniak and Zaeri or Eleniak and Van der Ree, I choose the
version presented by Zaeri or Van der Ree. It is apparent Eleniak
wishes to have this Court rule in his favour and to find him to
have been an employee during the course of his relationship with
Cool-It, not for purposes of permitting him to receive EI
benefits - already obtained as a result of having qualified
due to former employment - but to use such finding as a
springboard from which to launch his pursuit of arrears allegedly
owing to him - in disability payments - by Federated in
accordance with the existing policy covering Cool-It employees.
As a result, the evidence of the appellant was designed to create
an atmosphere of servitude that did not exist even though he
attempted to demonstrate the extent to which he had been
integrated into the daily business operations of Cool-It by
relating how he had answered telephones, opened up the shop - and
put the sign out on the sidewalk - each morning and had been
required to run errands in accordance with a list provided to him
by Zaeri. The position of General Manager existed only in his own
mind. One has to ask: why would he be retained as a marketing
specialist by the business group - following the meeting at the
Vancouver restaurant - and yet be fulfilling the role of General
Manager - only as it pertained to the operations of Cool-It
- three or four weeks later. Zaeri testified Eleniak had
wanted the sum of $2,750 for his services but the business group
had countered with an offer to pay the sum of $500 per week. The
appellant - prior to submitting his closing argument -
advised the Court that his initial salary demand had been in the
sum of $3,300 per month but he had agreed to accept the sum of
$2,750. To put it bluntly, the appellant suffers from delusions
of grandeur. He wanted to be perceived at the outset - and
acted consistently throughout - as a marketing guru with
overseas experience capable of expanding the revenue of the
Cool-It business group. He had already been experiencing health
problems and efforts to be enrolled in the Cool-It disability
insurance plan played a significant part in his overall plan. To
that end, he misrepresented himself to Van der Ree as fulfilling
the role of General Manager of Cool-It and - even worse
- completed the application form on the basis he had been
working for the intervenor since October 1, 1999 when
- in fact - he had begun to provide his marketing services
on or about October 27, 1999. Throughout the working
relationship, he continued to accept payment for his services at
the rate of $500 per week - without any deductions - and the
cheques drawn on the Cool-It account - signed by Zaeri
- were issued to Larry Eleniak - personally - in
response to his specific request even though he was operating
- supposedly - as a limited company. The explanation
offered by him - to Zaeri - was that he was using his
personal name as part of the official incorporated name and,
therefore, it did not make any difference.
[20]
Taking all the evidence into account and applying it in the
manner directed by the Federal Court of Appeal in Wiebe,
supra, I find the Minister was correct in deciding the
appellant was not engaged in insurable and pensionable employment
with Cool-It during the relevant period.
[21]
The within appeal is hereby dismissed and - as agreed by
the parties at the outset - this result is applicable to
appeal 2001-479(CPP) and it is also dismissed.
Signed at Sidney, British Columbia, this 9th
day of November 2001.
"D.W. Rowe"
D.J.T.C.C.
COURT FILE
NO.:
2001-478(EI)
STYLE OF
CAUSE:
Larry W. Eleniak and M.N.R. and
Cool-It Auto Services Ltd.
PLACE OF
HEARING:
Vancouver, British Columbia
DATE OF
HEARING:
August 17, 2001
REASONS FOR JUDGMENT
BY: the Honourable Deputy Judge D.W.
Rowe
DATE OF
JUDGMENT:
November 9, 2001
APPEARANCES:
For the
Appellant:
The Appellant himself
Counsel for the
Respondent:
Isabelle Jackson
For the
Intervenor:
Joyce Bradford (Agent)
COUNSEL OF RECORD:
For the
Appellant:
Name:
Firm:
For the
Respondent:
Morris Rosenberg
Deputy Attorney General of Canada
Ottawa, Canada
For the Intervenor:
COURT FILE
NO.:
2001-479(CPP)
STYLE OF
CAUSE:
Larry W. Eleniak and M.N.R. and
Cool-It Auto Services Ltd.
PLACE OF
HEARING:
Vancouver, British Columbia
DATE OF
HEARING:
August 17, 2001
REASONS FOR JUDGMENT
BY: the Honourable Deputy Judge D.W.
Rowe
DATE OF
JUDGMENT:
November 9, 2001
APPEARANCES:
For the
Appellant:
The Appellant himself
Counsel for the
Respondent:
Isabelle Jackson
For the
Intervenor:
Joyce Bradford (Agent)
COUNSEL OF RECORD:
For the
Appellant:
Name:
Firm:
For the
Respondent:
Morris Rosenberg
Deputy Attorney General of Canada
Ottawa, Canada
For the Intervenor:
2001-478(EI)
BETWEEN:
LARRY W. ELENIAK,
Appellant,
and
THE MINISTER OF NATIONAL REVENUE,
Respondent,
and
COOL-IT AUTO SERVICES LTD.,
Intervenor.
Appeal heard on common evidence with the
appeal of Larry W. Eleniak (2001-479(CPP)) on August
17, 2001 at Vancouver, British Columbia, by
the Honourable Deputy Judge D.W.
Rowe
Appearances
For the
Appellant:
The Appellant himself
Counsel for the Respondent:
Isabelle Jackson
Agent for the
Intervenor:
Joyce Bradford
JUDGMENT
The appeal is dismissed and the decision of the Minister is
confirmed in accordance with the attached Reasons for
Judgment.
Signed at Sidney, British,
Columbia, this 9th day of November 2001
D.J.T.C.C.