Date: 20100217
Docket: A-483-10
Citation: 2011 FCA 63
Present: SEXTON
J.A.
BETWEEN:
ATTORNEY GENERAL OF CANADA
and NATIONAL PAROLE BOARD
Appellants
and
JOHN ANTHONY FRANCHI
Respondent
REASONS FOR ORDER
SEXTON J.A.
[1]
The Appellants
move for a stay pending appeal of a judgment of Justice Harrington of the
Federal Court (the “Applications Judge”) allowing Mr. Franchi’s application for
judicial review of a decision of the National Parole Board’s Appeal Division.
[2]
Mr.
Franchi was convicted of fraud-related charges for the second time in October
2007, and is currently serving a six-year prison sentence. He was released on
day parole in April 2009.
[3]
Mr.
Franchi’s day parole was subject to the conditions imposed on every parolee
pursuant to section 161 of the Corrections and Conditional Release
Regulations, SOR/92-620 (the “Regulations”). Among these conditions,
subparagraph 161(1)(g)(iii) requires that a parolee immediately report
“any change in the…financial situation of the offender” to his or her parole
supervisor (the “standard condition”). Subsection 133(3) of the Corrections
and Conditional Release Act, S.C. 1992 c. 20, also allows the National
Parole Board (the “Board”) to impose release conditions on individual offender above
and beyond the standard conditions imposed by the Regulations. In Mr.
Franchi’s case, the Board required that he “provide full financial disclosure,
including assets, debts, income and expenditures, immediately to your parole
supervisor upon request” (the “special condition”).
[4]
Over the
course of August 2009, Mr. Franchi borrowed about $104,000. He claims that his
intention was to invest that money at a high rate of interest and use the
proceeds to pay down his debts. When this came to the attention of the
authorities and they raised the issue with Mr. Franchi, he provided information
about these activities. However, he had not reported the activity on his own
initiative prior to his being required to respond to the request for full
financial disclosure, despite the fact that he had the opportunity to do so
during at least two meetings with his parole officer.
[5]
The Board
found that Mr. Franchi was in breach of the standard condition because he had
failed to inform his parole officer immediately of the loans and his investment
activity. It also found that he was in breach of the special condition because
his disclosure on request was incomplete. On this basis, it revoked his day
parole. That decision was affirmed by the Appeal Division of the National
Parole Board.
[6]
The
Applications Judge allowed Mr. Franchi’s application for judicial review of the
Appeal Division’s decision. He recognized that “[w]ere it not for the special
condition, it could fairly be said that he was in breach because he failed to immediately
report any change in his financial situation. Borrowing more than $100,000 is
certainly a change in one’s financial situation” (emphasis in original).
According to the Applications Judge, however, the standard condition and the
special condition were contradictory. The only way to read the conditions
together was that the special condition modified the standard condition, and
that Mr. Franchi was therefore only required to provide disclosure upon
request. He held that it was unreasonable for the National Parole Board and
Appeal Division to hold otherwise. The Applications Judge also held that the
Board and Appeal Division gave inadequate reasons for its conclusion that Mr.
Franchi had breached the special condition through inadequate disclosure, and
that this constituted a breach of procedural fairness.
[7]
The
Attorney General and the National Parole Board have appealed the Applications
Judge’s decision to this court, and they now move for a stay of that decision
pending appeal. The test for granting such a stay was set out by the Supreme
Court of Canada in RJR-MacDonald v. Canada (A.G.), [1994] 1 S.C.R. 311
at paragraph 43 [RJR-MacDonald]. In order for a stay to be granted,
three conditions must be met. First, there must be “a serious question to be
tried” on appeal. Second, the applicant must prove that it would suffer
irreparable harm if the stay is not granted. Finally, the applicant must
satisfy the court that the balance of convenience favours granting the stay.
[8]
As the
Supreme Court recognized, the threshold for a serious question to be tried is
low (RJR-MacDonald at paragraph 49). Such an issue exists in this
case. The Applications Judge’s conclusion that Mr. Franchi had not breached
the standard condition turned on his holding that the standard condition and
the special condition were contradictory, and that the special condition
effectively modified the standard condition. It is certainly arguable that the
two conditions serve different and complementary roles in preventing
recidivism: while the standard condition assures that authorities are informed
automatically when a parolee’s circumstances change, the special condition
gives authorities access to more complete information when necessary. Without
expressing an opinion on the correctness of Applications Judge’s decision, it
is clear to me that this appeal is “neither frivolous nor vexatious”. There is
therefore a “serious issue” to be decided on appeal (see RJR-MacDonald at
paragraph 49).
[9]
Turning to
the second and third factors, it is important to recognize that courts will
accord particular consideration to the public interest. As Justices Sopinka
and Cory wrote in RJR-MacDonald:
In our view,
the concept of inconvenience should be widely construed in Charter cases.
In the case of a public authority, the onus of demonstrating irreparable harm
to the public interest is less than that of a private applicant. This is
partly a function of the nature of the public authority and partly a function
of the action sought to be enjoined. The test will nearly always be
satisfied simply upon proof that the authority is charged with the duty of
promoting or protecting the public interest and upon some indication that the
impugned legislation, regulation, or activity was undertaken pursuant to that
responsibility. Once these minimal requirements have been met, the court
should in most cases assume that irreparable harm to the public interest would
result from the restraint of that action (at paragraph 71).
[10]
I am
satisfied that failure to grant a stay would cause irreparable harm to the
public interest. The Appellants have presented evidence that the Applications
Judge’s decision could have extremely broad effects. Between April 1 and
November 14, 2010, the Board imposed special conditions on 627 offenders
requiring financial disclosure upon request. The Applications Judge’s decision
implies that these offenders may not be required to proactively notify
authorities of changes to their financial situations. This legal uncertainty would
limit the Board’s ability to fulfill its mandate of supervising offenders in
order to prevent recidivism.
[11]
Mr.
Franchi submitted that this would not be a problem, because authorities could
simply request disclosure under the special condition whenever necessary. I
cannot agree. Not only would this likely place an onerous burden on parole
officials, but it misses the point of the standard condition, which is to
ensure that authorities are notified immediately of financial activity that
could indicate recidivism. Even if parole officers adopted a policy of monthly
requests for full disclosure, this could obviously not catch a problem created
by an offender’s actions closely following such disclosure.
[12]
I am also
satisfied that the balance of convenience favours granting the stay. As I have
already stated, the absence of a stay the decision of the Applications Judge
will create uncertainty as to the responsibilities of hundreds of offenders,
and it will limit the Board’s ability to carry out its mandate. Against this
must be weighed the infringement on Mr. Franchi’s liberty interests caused by
his loss of day parole. On balance, I must conclude that the Board’s ability
to fulfil its mandate and protect society should be accorded paramount
importance, and that the balance of convenience therefore favours granting a
stay in these circumstances (Condo v. Canada (A.G.), 2010 FC 1286 at
paragraph 6; Kuipers v. Canada (1994), 74 F.T.R. 306 at paragraph 28
(T.D.)).
[13]
The motion
is therefore allowed without costs, and the decision of the Applications Judge
will be stayed pending appeal. I consulted with the parties, who consented to
having an expedited hearing, and to the following terms. The hearing is fixed
for 9:30 a.m. on April 11, 2011 in Toronto,
for three hours. The Appellants’ materials, including appeal book and
memorandum of fact and law, are to be filed by March 14, 2011. The
Respondent’s materials, including appeal book and memorandum of fact and law,
are to be filed by March 28, 2011.
"J. Edgar Sexton"
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