Citation: 2013 TCC 55
Date: 20130221
Docket: 2011-3663(EI)
BETWEEN:
GUY CHARBONNEAU,
Appellant,
and
THE MINISTER OF NATIONAL REVENUE,
Respondent,
and
DIDIER GIRARD,
Intervener.
[OFFICIAL ENGLISH
TRANSLATION]
REASONS FOR JUDGMENT
Batiot D.J.
[1]
The appellant, Guy
Charbonneau, is appealing from a decision of the Canada Revenue Agency (CRA). The
respondent set aside its decision after considering all the relevant facts
including the submissions of Didier Girard, the payer and intervener. The
appellant claims that he was eligible for employment insurance when he worked
with the payer; the respondent declared him ineligible.
THE CONTRACT
[2]
Having known him for a
few years, the appellant approached the payer, a cabinetmaker by trade, and
they discussed the possibility of working together. The appellant had had some
experience in the trade 20 years ago. They agreed on the following points:
- The appellant would work in the payer's
workshop and would use the tools found there.
- The appellant would submit his invoices for
the work performed;
- The appellant would keep his independence
and work on his own schedule;
- The payer would show him the work to be
done and pay the invoices that were submitted to him.
LEGAL CONTEXT
[3]
Were the appellant and
the payer engaged in a contract of service (employee) or a contract for
services (self-employed worker)?
[4]
In Quebec, this issue
must be resolved by taking into consideration the Civil Code of Quebec, L.R.Q.,
c. C-1991 (C.C.Q.) (see Garneau v. M.N.R., 2006 TCC 160), which is
supplemental to the common law in this area (Wiebe Door Services Ltd. v.
M.N.R., 87 D.T.C. 5025; Grimard v. Canada, 2009 FCA 47). The
following articles of the C.C.Q. are relevant:
1425. The common intention of the parties rather than adherence to the
literal meaning of the words shall be sought in interpreting a contract.
1426. In interpreting a contract, the nature of the contract, the
circumstances in which it was formed, the interpretation which has already been
given to it by the parties or which it may have received, and usage, are all
taken into account.
2085. A contract of employment is a contract by which a person, the
employee, undertakes for a limited period to do work for remuneration,
according to the instructions and under the direction or control of another
person, the employer.
2086. A contract of employment is for a fixed term or an indeterminate
term.
2098. A contract of enterprise or for services is a contract by which a
person, the contractor or the provider of services, as the case may be,
undertakes to carry out physical or intellectual work for another person, the
client or to provide a service, for a price which the client binds himself to
pay.
2099. The contractor or the provider of services is free to choose the
means of performing the contract and no relationship of subordination exists
between the contractor or the provider of services and the client in respect of
such performance.
THE PRACTICE
[5]
This arrangement was
put into practice. The payer, who specializes in building solid-wood staircases
for his own clients, showed the appellant how he prepared the wood for parts of
the project (such as treads and risers), but the appellant was free to do it
his own way. The important part was the end result, which had to satisfy both
the payer and his clients' requirements. As far as the payer could remember,
the appellant did not meet this quality criterion only once or twice and redid
the work himself. At all other times, the finished products were satisfactory.
[6]
For each project, the
payer gave the appellant the exact dimensions required for the parts. Each project
was unique it seems and, of course, had to meet building code standards.
[7]
The appellant said that
the work hours were from 7:30 a.m. to 4:30 or 5 p.m., five days per week, that
he chose the wood for the project, cut it, prepared it and assembled it as required,
in the payer's workshop, using the payer's tools. He had only a few of his own
tools on hand.
[8]
The appellant submitted
his invoices, which the payer paid by cheque or direct deposit right away
without discussion. There were 37 invoices between January 4 and
August 24, 2010. The appellant was not certain of the dates, but his
counsel reminded him of them. All but four are for different amounts. It
appears that the appellant needed money urgently sometimes, it seems, after
one, two or three days of work (Exhibits A-1: $144.38 on 16/04/10, $330 on
07/05/10, $269 on 12/05/10, $231 on 14/05/1, $363 on 27/05/10, etc.). His pay increased
from $15 to $16.50 per hour the week of August 15, 2010. The
invoice dated August 24 is signed by the appellant like the others, with thanks
and the words: [Translation]
"It has been a pleasure working with you".
[9]
This
last invoice is a submission form that the appellant had used since June 29.
Some have been corrected, all state the working hours, an amount, the appellant's
SIN and the method of payment (direct or by cheque). Those are in fact invoices.
[10]
The appellant admitted
that he had been a self-employed worker, which gave him the independence he cherished,
and received the full amount of his invoices, without any deductions. In the
spring, he thought, given his repeated absences, that the arrangement was going
to be over and declined the payer's second job offer with the benefits that such
status entailed. He ended his association with the payer on August 24, 2010,
and went to the office of Emploi et solidarité sociale, which, upon learning that
he had earned an income, referred him to employment insurance. Unfortunately,
he had no insurable hours.
[11]
After some back and forth
between those two organizations about his submissions, the appellant received
employment insurance benefits, which were then terminated, when more evidence
was provided, including that of the payer. The appellant therefore received a
request to repay some $19,000; he was ineligible. Hence, this appeal.
[12]
The payer, Didier
Girard, wanted to help the appellant, which was why he had accepted the
agreement and the work hours of the appellant, who had acknowledged his
absences and his money problems, attributable to his addiction problem, which
he has been fighting and continues to fight.
[13]
The payer was satisfied
with the work completed. His workshop is open from 8 a.m. to 5 p.m., five days
a week, but he let the appellant use it on one or two evenings. The payer
thought that the appellant had his own clients.
[14]
The payer is a member
of the Confrérie du Bois in France. Every year, the Confrérie uses a
Franco-Canadian organization to offer professional internships to a member who
must be an employee. Thus, he has the organizational skills and accounting
knowledge needed to have an employee, in the appellant's opinion on this subject.
The appellant decided not to be one despite two job offers.
[15]
The payer lent him a
book called [Translation] Cabinetwork
from A to Z. The appellant cited it as evidence that he had received some
training from the payer. I note that the appellant had asked for this book and
that the payer lent it to him voluntarily for his own technical building. It is
likely that these two "wood workers" discussed their work from time
to time; they were in the same workshop, knew each other and shared a common
interest. But the payer provided no professional training to the appellant,
because he was not a member of the Confrérie.
[16]
The payer described his
working relationship with the appellant, which reflected the above-mentioned
agreement. He exercised no control over the appellant's conduct or over his
absences; the appellant could work in his workshop during working hours on the
payer's projects in order to make individual parts in accordance with
established standards. He submitted invoices within his own timelines (37 in
less than eight months, some for only a few hours of work), which were paid
immediately. If the appellant [Translation]
"complied with Didier's [the payer’s] requests" regarding invoices,
it was because the payer needed to know the amounts to be paid, which was an
arrangement they had had from the start, and to keep the invoices for his own
accounting, which is a business and tax obligation.
[17]
Indeed, when I consider
the evidence in its entirety, it is remarkable to note that the appellant was
free from all control on the payer's part, except regarding the quality of the
finished product (which is not necessarily an indicator of a relationship of
subordination, see Combined Insurance Company of America v. M.N.R., 2007
FCA 60, paragraph 70). He was not subject to any subordination: he had no obligation,
required by article 2085 C.C.Q. (contract of employment), towards the payer; he
could work or not work, during the hours he preferred, for one or several days;
it was his choice entirely, which he exercised without explanations. It is true
that he used the payer's tools in his workshop, but it was the most convenient
solution for him to do the work. The only obligation was that of the payer to
pay the appellant, required by article 2098 C.C.Q. (contract of enterprise),
for the work that the appellant did, when he was available, during the
workshop's hours of operation, where he was "free to choose the means of
performing the contract" (art. 2099 C.C.Q.).
[18]
It is exactly the nature
of a contract of enterprise or for services described in articles 2098 and 2099
C.C.Q. without the appellant's undertaking to carry it out. He was therefore a
self-employed worker.
[19]
The appeal is
dismissed.
Signed at Annapolis Royal, Nova Scotia, this 21st day
of February 2013.
"J.-L. Batiot"
Translation certified true
on this 12th day of April 2013
Margarita Gorbounova, Translator
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