Date: 19990607
Docket: 98-276-GST-I
BETWEEN:
STANLEY J. TESSMER LAW CORPORATION,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
Amended reasons for judgment
McArthur, J.T.C.C.
[1] The Appellant corporation operates a law practice. Legal
services are provided by Stanley J. Tessmer (Tessmer), a criminal
defence lawyer who has narrowed his services to defending persons
charged with the criminal offence of impaired driving and with
the criminal offence arising from growing marijuana. The issue is
whether the Appellant corporation is required to pay goods and
services tax (GST) on fees charged for its legal services.
Tessmer testified in this appeal and he stated that imposing
payment of GST on the Appellant's clients is
unconstitutional.
[2] The Appellant is paid $5,000 plus GST for defending a
client charged with impaired driving and $10,000 plus GST for
marijuana charges. The Minister of National Revenue assessed the
Appellant in the amount of $2,923.37 for GST together with
interest and penalties for the period January 1, 1997 to March
31, 1997. The Appellant had collected GST for that period without
remitting it to the Minister in order to commence this appeal. It
has now been remitted.
Position of the Appellant
[3] Subsection 10(b) of the Charter of Rights and
Freedom (the Charter) grants everyone the right, on
arrest or detention to retain and instruct counsel. In the case
of Regina v. Leclaire and Ross,[1] the Supreme Court of Canada
interpreted the word 'counsel' as 'counsel of
choice'. Tessmer stated that should a client wish the
Appellant to represent him or her being prepared to advance
$5,000 or $10,000 in fees, but not be in a position to pay the
additional $350 or $700 in GST, then that client is denied the
right of counsel of choice which violates subsection 10(b)
of the Charter.
Position of the Respondent
[4] To enforce rights under the Charter, it must be
your own right as stated by the Supreme Court of Canada in The
Attorney General of Quebec v. Irwin Toy Limited.[2] The Appellant cannot
challenge the law with respect to GST because it violates some
other person's rights. It is the Appellant's clients that
must pay the GST and not the Appellant. Secondly, subsection
10(b) gives everyone the right on arrest or detention to
be informed of their right to retain and instruct counsel. In
John Carten Personal Law Corp. v. British Columbia (Attorney
General),[3]
the Supreme Court of Canada held that to find the tax on legal
services contained in the British Columbia Social Services Tax
Amendment Act, 1992, unconstitutional, the Appellant would be
required to prove that the right to counsel was denied, or its
exercise was prevented by the existence of the 7% tax. The
Appellant must prove "a right which would have been
exercised but for this tax could not be exercised because of this
tax".[4]
Legislation
[5] Subsection 10(b) of the Charter of Rights and
Freedom reads as follows:
10 Everyone has the right on arrest or detention
...
(b) to retain and instruct counsel without delay and to be
informed of that right; ...
Analysis
[6] There is no doubt that the Appellant's clients and
indeed everyone upon arrest or detention, has to be informed of
their right to have counsel. The main force of the
Appellant's argument is that subsection 10(b) gives
the detainee or accused the privilege to retain counsel of choice
without regard to one's financial resources. This, I find,
extends subsection 10(b) too far. A comprehensive legal
aid system in British Columbia and in all provinces offers
counsel to those who have been arrested or detained. Surely, the
purpose of subsection 10(b) is to assure that persons
arrested or detained are made aware of their right to counsel and
the attempt of the legal aid plan to make affordable legal
assistance available.
[7] In Panacui v. Legal Aid Society (Alta.),[5] Justice McDonald
dealt with the issue of whether an accused person is permitted to
use the state's funds to pay counsel of his choice rather
than one selected by the state on his behalf. He concluded at
pages 143-144 that the right to counsel guarantees that an
accused has the right to professional advice and assistance
during the pre-trial process, at trial and through the appellate
process. He added that freedom of choice of counsel is not
essential to satisfy the requirements of
subsection 10(b). Justice McDonald
concluded:
The rich man charged with an offence may be able to afford to
pay a defence lawyer whose fees are high, but the rich man's
ability to pay such fees will not guarantee that he will have the
most effective counsel. His judgment as to which expensive lawyer
to select may be exercised badly if the rich man relies upon
unsound information and advice in making his selection. The
system affords him no guarantee that he will choose the best. He
may think that he has, but there is no way that he can be sure.
The system guarantees him no more than that he will have the
right to professional advice and assistance for the purposes
listed above during the pre-trial process, at trial, and until
the appellate process is completed. His right to counsel is an
objective one; his subjective sense of satisfaction is of no
concern to the judicial system. Nor is the question whether
the counsel he has chosen will in fact be as effective as he
hopes and thinks, even if it were possible to measure that fact
objectively. (Emphasis added)
I agree with this reasoning and adopt it as my own. Subsection
10(b) does not support a constitutional guarantee of an
accused person to have counsel of his choice.
[8] In Regina v. Prosper,[6]the Supreme Court of
Canada concluded that an arrested or detained person has the
informational right to retain and instruct counsel without delay
and also the right to be so informed. The Court was unanimous in
finding at page 278 that:
Section 10(b) of the Charter does not impose a
substantive constitutional obligation on governments to ensure
that duty counsel is available, or likewise, provide detainees
with a guaranteed right to free and immediate preliminary legal
advice upon request. ...
The Court discussed the obvious utility and cost of providing
such free duty counsel services. It is not a constitutional
obligation. There is a constitutional guarantee to be informed of
the right to legal advice through legal aid services if needed.
There is no constitutional right to counsel of choice.
[9] In Regina v. Leclair and Ross,[7]referred to by
counsel for both the Appellant and the Respondent, the Supreme
Court of Canada held that an accused or detained person can call
any lawyer of his choice. The Court does not say, however, that
the state must pay for that counsel of choice. This is a choice
to retain a legal aid counsel, a duty counsel, if available, or
his or her own counsel. This is the extent of the choice. The
Appellant's argument in the present appeal is a monetary one.
The Appellant's counsel submits that the levy of a 7% GST may
prevent clients from retaining Tessmer because, while they can
afford his $5,000 or $10,000 fee, they cannot afford the
additional 7% tax. It defies common sense to conclude that
subsection 10(b) guarantees all accused, regardless of
their finances, the right to retain the most expensive counsel.
The decision in Regina v. Leclair and Ross does not
support that proposition. While there is a privilege to retain
counsel, that is quite different from saying that every person,
whether he can or cannot pay the fees of a lawyer, has the right
to retain counsel of his other choice.[8]
[10] As stated above, subsection 10(b) of the
Charter gives the right to retain counsel. Counsel of
choice without payment of GST, which in essence is placing an
additional burden on the taxpayer, is not the same thing. The
Charter does not absolve an accused who pays for legal
services, from GST. The Appellant's fees, Tessmer admits, are
high compared to those fees charged by others. The country has no
constitutional duty to subsidize the funding of defence lawyers
regardless of the accused's financial resources. Tessmer is
not prepared to reduce the Appellant's fees to accommodate
his clients, yet submits that the state be deprived of the GST.
The Appellant's interpretation of subsection 10(b)
defies common sense and leads to an absurd situation.
[11] Both counsel referred this Court to John Carten
Personal Law Corp.[9]wherein the Appellant submitted that tax
on legal services was inconsistent with the rights given in
subsection 10(b) of the Charter. Speaking for the
majority, Lambert J.A. stated at paragraph 13:
There are many reasons why the cost of legal services, or a
lack of funds, may restrict, hamper, or even prevent a person
from exercising rights of access to the courts or rights of
access to other legal services. What would be required in order
to find this Act wholly unconstitutional, or even
unconstitutional in its application in a particular case, would
be proof that people, or a class of people, in general, or some
person in particular, who would have been able to exercise the
legal rights in question if this tax were not in effect, were or
was prevented by this tax from exercising those rights. It would
not be sufficient to found an argument that the Act was
unconstitutional in concept or in application merely to show that
the tax operated as an impediment or a discouragement to the
exercise of a protected right. What would be required would be
proof that the right was denied, or its exercise was prevented,
by the existence or operation of this tax. In other words, that a
right which would have been exercised but for this tax could not
be exercised because of this tax. ...
The present Appellant did not introduce any evidence to prove
that anyone was prevented from exercising the right to
counsel.
[12] Finally, the Respondent submitted that the Appellant
corporation cannot challenge the law on the ground that it
violates another person's Charter right. In this
appeal, the Appellant is not claiming that its subsection
10(b) rights were infringed upon. The Appellant claims
that it is its clients' rights that are infringed. While it
is not necessary to deal with this submission, I agree with the
Respondent's position that it must be your own Charter
rights that are at issue if one challenges the validity of a
statute.[10]
[13] The appeal is dismissed, without costs.
Signed at Ottawa, Canada, this 7th day of June, 1999.
"C.H. McArthur"
J.T.C.C.
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