[OFFICIAL ENGLISH
TRANSLATION]
Date:
20000501
Docket:
98-1073(UI)
BETWEEN:
MARC
MARTINEAU,
Appellant,
and
THE
MINISTER OF NATIONAL REVENUE,
Respondent.
REASONS FOR JUDGMENT
Charron, D.J.T.C.C.
[1] This appeal was heard at Québec, Quebec, on
February 7, 2000, for the purpose of determining whether the appellant held
insurable employment within the meaning of the Employment Insurance Act
(the Act) when employed by Construction Raoul Pelletier inc., the payer,
from June 3 to December 13, 1991.
[2] In a letter dated July 29, 1998, the
respondent informed the appellant that the employment in question was not
insurable because it did not meet the requirements of a contract of service and
there was no employer-employee relationship between him and the payer during
the period under appeal.
Statement of facts
[3] The facts relied on by the Minister are
described at paragraph 5 of the Reply to the Notice of Appeal (the
"Reply") as follows:
[TRANSLATION]
(a) The payer operated a residential and commercial
excavation, heavy machinery rental and snow removal business. (admitted)
(b) The payer's business was operated year-round.
(admitted)
(c) In 1991, the appellant says he purchased a 10‑wheel
truck for $10,000 to operate his own business. (admitted)
(d) The appellant claims that he was engaged in
transportation for the payer during the period in issue. (admitted)
(e) During the period in issue, the appellant's
truck allegedly broke down for two or three months and the appellant claims he
repaired it himself. (admitted)
(f) The appellant claims that he worked for the
payer at the time as a mechanic, while running errands in the payer's pick‑up.
(admitted)
(g) The appellant mentioned that, during that period,
he had only worked a day or two a week for the payer, then claimed that he had
worked between 35 and 40 hours a week during the entire period in issue.
(admitted to 35)
(h) The appellant worked on his truck and was the
only person who drove it. (admitted)
(i) The appellant claims that he received $8 an
hour when he ran errands and $10 an hour when he worked as a mechanic.
(admitted)
(j) The appellant's record of employment states
that he was alleged to have received fixed remuneration of $680 a week (more
than 68 hours a week) during all the weeks in the period in issue. (denied
as drafted)
(k) The appellant was the sole owner of his truck
and he alone paid all its operating expenses. (admitted)
(l) The record of employment submitted by the
appellant is false because it does not reflect the true situation regarding the
work actually done and the remuneration earned. (denied)
[4] The appellant admitted that all the
subparagraphs of paragraph 5 of the Reply to the Notice of Appeal were
true, except those which he denied, as indicated in parentheses at the end of
each subparagraph.
Marc Martineau's
Testimony
[5] Paul‑Émile Martineau, the
appellant's brother, requested permission to assist the appellant because he is
deaf. Permission was granted. In 1991, during the above period,
Marc Martineau purchased a 10‑wheel truck for $10,000 to operate his
own transportation business. During the period in issue, he was engaged in
transportation for Construction Raoul Pelletier Inc. In the course of his
trips, the appellant's truck broke down and had to undergo repairs for two or
three months. The appellant did his own repairs, while running errands and
doing mechanical jobs for the payer 35 hours a week, at a rate of one or
two days during the entire period. He earned $8 an hour for running
errands and $10 an hour for mechanical jobs while employed by the payer.
Marc Martineau is the sole owner of his truck and paid all its expenses.
After consulting his brother Paul‑Émile, he admitted that he had received
unemployment benefits to which he had not been entitled. His record of
employment from June 3 to December 13, 1991, states that he worked
22 weeks for the payer at a fixed salary of $680 a week. However, in
subparagraph (g) of the Reply to the Notice of Appeal, he amended his
statement and said that he had only worked a day or two a week for the payer,
35 hours in all, during the entire period in issue. Further on, he claimed
that he had often worked 68 hours a week. The appellant paid his truck's
operating expenses for items such as repairs, gasoline, licence plates,
insurance and traffic tickets for driving violations.
Fernande
Vignola-Martineau's Testimony
[6] Fernande Martineau explained that the
appellant was paid $40 to $45 an hour when he worked with his truck and only
$10 when he drove that of the payer. The payer arranged to spread out the
appellant's hours so that he could pay him an equal salary of $680 a week,
including deductions for income tax, unemployment insurance and accident
insurance throughout the period in issue.
[7] The appellant failed to have the payer's
representative Ghyslain Pelletier, testify, even though he was present.
Analysis of the Facts in Relation to the
Law
[8] It must now be determined whether the
activity carried on by the appellant is included in the concept of insurable
employment, that is, whether there was a contract of service.
[9] The case law has laid down four essential
tests for identifying a contract of employment. The leading case is Montreal
v. Montreal Locomotive Works Ltd., [1947] 1 D.L.R. 161. Those tests are:
(1) control, (2) ownership of the tools, (3) chance of profit and (4) risk of
loss. The Federal Court of Appeal added thereto the "degree of
integration" in Wiebe Door Services Ltd. v. M.N.R., [1986] 3 F.C.
553, but this list is not exhaustive.
[10] The evidence showed that the work performed
by the appellant was done under no one's direction and that there was no
relationship of subordination between the payer and him. The appellant owned
the truck he used to do his work. Accordingly, the services rendered by the
appellant were in the nature of a contract for services, not a contract of
service.
[11] Every agreement or arrangement providing for
terms and conditions of payment of remuneration on the basis not of the time or
period of performance of the remunerated work, but of other objectives such as
benefiting from the provisions of the Act vitiates the nature of the contract
of service.
[12] Furthermore, there is no room for other
considerations such as generosity or convenience. It has often been said that
unemployment insurance is a social measure designed to assist those who
actually lose their employment and not a subsidy program to assist business or
benefit claimants who bend or alter the structure and terms and conditions of
payment of the remuneration which their work performance calls for.
[13] Every agreement or arrangement to accumulate
or spread out hours has the effect of vitiating the contract of service,
particularly since this creates a contractual relationship which is not very or
not at all conducive to the existence of a relationship of subordination, an
essential component of a contract of service.
[14] The burden was on the appellant to prove his
entitlement and he did not discharge that burden to the Court's satisfaction.
On the contrary, he made false statements.
[15] Therefore, the
appeal is dismissed and the Minister's decision confirmed.
Signed at Ottawa, Canada, this 1st
day of May 2000.
D.J.T.C.C.
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