Order of St. John of Jerusalem v. Canada (Minister of National Revenue), 2004 FCA 345

Date: 20041013

Docket: A-685-02

Citation: 2004 FCA 345

CORAM:        DÉCARY J.A.

LÉTOURNEAU J.A.

NADON J.A.

BETWEEN:

                THE PRIORY OF CANADA OF THE MOST VENERABLE ORDER OF

                                                      ST. JOHN OF JERUSALEM

                                                                                                                                            Applicant

                                                                           and

                                            MINISTER OF NATIONAL REVENUE

                                                         PASCALE CHOQUETTE

                                                                                                                                      Respondents

                                         Heard at Ottawa, Ontario, on October 13, 2004.

                   Judgment delivered from the Bench at Ottawa, Ontario, on October 13, 2004.

REASONS FOR JUDGMENT OF THE COURT BY:                                        LÉTOURNEAU J.A.

Date: 20041013

Docket: A-685-02

Citation: 2004 FCA 345

CORAM:        DÉCARY J.A.

LÉTOURNEAU J.A.

NADON J.A.

BETWEEN:

                THE PRIORY OF CANADA OF THE MOST VENERABLE ORDER OF

                                                      ST. JOHN OF JERUSALEM

                                                                                                                                            Applicant

                                                                           and

                                            MINISTER OF NATIONAL REVENUE

                                                         PASCALE CHOQUETTE

                                                                                                                                      Respondents

                                     REASONS FOR JUDGMENT OF THE COURT

                      (Delivered from the Bench at Ottawa, Ontario, on October 13, 2004)

LÉTOURNEAU J.A.

[1]                We are of the view that the fate of this application for judicial review regarding Ms. Choquette and Ms. Roy is governed by the principles enunciated by this Court in D and J Driveway Inc. v. Le ministre du Revenu national, 2003 CAF 453, Le Livreur Plus Inc. v. Le Ministre du Revenu national et Laganière, 2004 CAF 68, and Wolf v. Canada, [2004] 4 F.C. 396 (F.C.A.).

[2]                According to the evidence, the intent of the parties was to enter into a contract for services whereby first aid instructors such as Ms. Choquette and Ms. Roy regarded themselves as independent workers or contractors. That is the mutual understanding that the parties had of their relationship. In this case, Ms. Choquette wanted a self-employed worker status because the flexibility of the work schedule suited her and allowed her to assume her family responsibilities: see paragraph 35 of the decision under appeal and pages 133 to 136 of the transcript of the hearing before the Tax Court of Canada.

[3]                Although the stated intent of the parties or their mutual understanding are not necessarily determinative of the nature of their relationship, they are, however, entitled to considerable weight in the absence of evidence to the contrary, such as a behaviour which betrays or contradicts the said intent or understanding. Where the parties "have freely elected to come together in separate business arrangements rather than one side arbitrarily and artificially imposing that upon the other, so that in fact it is a sham, parties should be left to their choice and that choice should be respected by the authorities". We agree with this statement of Porter D.T. C.J. in Krakiwsky v. Canada (Minister of National Revenue - M.N.R.), 2003 T.C.J. No. 364.

[4]                In the present instance, many of the factors relevant to an assessment of the global nature of the parties' relationships support or confirm their common intention to operate under the terms of a contract for services: the first aid instructors were given work on a freelance basis in accordance with their availability, they were at liberty to refuse work without giving reasons and to decide if and when they wanted to work, they were free to work for other groups without any control from the applicant, their training was at their own expenses, they paid for their own insurance liability, they could determine their own work schedule, they had no guarantee that work would be offered or provided to them, the applicant had no control over the availability of the instructors, the income of the instructors was subject to fluctuation depending on their availability or the availability of work, the instructors were not paid in case of absence from work, they were not entitled to annual or sick leave or other leave days, the relationship between the parties could be terminated by the instructors simply informing the applicant that they were no longer available for work, Ms. Choquette filed her income tax return as an independent worker and claimed home-office deductions.

[5]                With due respect, all these facts are hardly compatible with or indicative of an employer/employee relationship.

[6]                For these reasons, this application for judicial review will be allowed with costs in the amount of $5,000 inclusive of disbursements, the decision of the Tax Court of Canada will be set aside and the matter will be referred back to the Chief judge of the Tax Court, or a judge that he will designate, for a new determination on the basis that the decision of the Minister shall be set aside and that Ms. Choquette and Ms. Roy's employment be declared non-insurable.

                                                                                                                               "Gilles Létourneau"                

                                                                                                                                                      J.A.

                                                  FEDERAL COURT OF APPEAL

                            NAMES OF COUNSEL AND SOLICITORS OF RECORD

DOCKET:                                          A-685-02

Application for judicial review from a decision of the Tax Court of Canada dated November 14, 2002

STYLE OF CAUSE:                          THE PRIORY OF CANADA OF THE MOST VENERABLE ORDER OF ST. JOHN OF JERUSALEM v. MINISTER OF NATIONAL REVENUE ET AL.

PLACE OF HEARING:                    Ottawa, Ontario

DATE OF HEARING:                      October 13, 2004

REASONS FOR JUDGMENT

OF THE COURT:                             DÉCARY, LÉTOURNEAU, NADON JJ.A.

RENDERED FROM THE

BENCH BY:                                      LÉTOURNEAU J.A.

APPEARANCES:

Mr. Paul Lepsoe                                                                        FOR THE APPLICANT

Mr. Martin Gentile                                                                     FOR THE RESPONDENTS

SOLICITORS OF RECORD:

McFarlane Lepsoe                                                                    FOR THE APPLICANT

Morris Rosenberg                                                                      FOR THE RESPONDENTS

Deputy Attorney General of Canada