Docket: A-81-17
Citation:
2017 FCA 252
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CORAM:
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NADON J.A.
STRATAS J.A.
WEBB J.A.
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BETWEEN:
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FRANK WILLIAMS
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Appellant
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and
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CANADA
(MINISTER OF PUBLIC SAFETY AND EMERGENCY PREPAREDNESS)
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Respondent
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REASONS FOR JUDGMENT
STRATAS J.A.
[1]
Mr. Williams appeals from the order dated
February 24, 2017 of the Federal Court (per McDonald J.): 2017 FC 234.
The Federal Court dismissed a summary judgment motion brought by Mr. Williams
in an action he has started.
[2]
In his action, Mr. Williams seeks the return of
certain United States currency that a border services officer seized from him
at a customs reporting station. Part of the currency has been declared
forfeited.
[3]
Whether Mr. Williams succeeds depends solely on
a legal question: was the seizure and forfeiture of his currency authorized by
law? Mr. Williams says no. The respondent Minister says yes. The Federal Court
agreed with the Minister. Mr. Williams now appeals.
[4]
For the reasons that follow, I would allow the
appeal and grant summary judgment in Mr. Williams’ favour.
[5]
The border services officer had no legal power
under the Proceeds of Crime (Money Laundering) and Terrorist Financing Act,
S.C. 2000, c. 17 (the “Act”) to seize any of the currency. The respondent
Minister has pointed to no other legal authority to justify the seizure. Thus,
Mr. Williams is entitled to the return of all of his currency.
A.
The nature
of the motion in the Federal Court
[6]
Mr. Williams’ motion for summary judgment was
brought under Rule 215(2)(b) of the Federal Court Rules, SOR/98-106. In
his notice of motion, Mr. Williams specifically sought the determination of a
question of law concerning the authority of the border services officer and
then judgment in the action in his favour on the basis that no genuine issue for
trial remained.
[7]
The parties did not file any affidavits in the
summary judgment motion. Thus, the only facts the Federal Court could have
relied upon in determining Mr. Williams’ motion are those that the Minister pleaded
to or admitted to in his statement of defence.
[8]
Given this, the thrust of Mr. Williams’ motion is
clear: judgment must be granted in his favour because, on the facts the
Minister pleaded or admitted, the border services officer had no legal authority
to seize his currency.
B. The facts for the purposes of the summary judgment motion
[9]
On July 3, 2015, Mr. Williams travelled
eastbound for Canada on the Blue Water Bridge. The bridge connects Port Huron,
Michigan, United States and Sarnia, Ontario, Canada. At the Canada Border
Services Agency reporting station, Mr. Williams told the border services
officer that “he made a wrong turn and did not intend
to enter Canada.” See statement of defence, paras. 5 and 6.
[10]
The border services officer then “proceeded with the standard line of questioning, including
whether or not [Mr. Williams] was in possession of currency or monetary
instruments equal to or greater than $10,000.00 CAD”: statement of defence,
para. 6. Mr. Williams replied, falsely, that he was not.
[11]
The border services officer then referred Mr.
Williams to secondary inspection. There, Mr. Williams was asked about a large bulge
in the front pocket of his shorts. Mr. Williams replied that he was carrying approximately
$6,000.00. When asked to produce the currency for inspection, Mr. Williams “admitted that he may, in fact, be in possession of upwards
of $10,000.00 as he was holding $2,500.00 for one of his passengers.” See
statement of defence, para. 7.
[12]
In fact, Mr. Williams was carrying $10,758.00
USD, then the equivalent of $13,518.50 CAD: statement of defence, para. 8. When
asked why he had not reported the currency, Mr. Williams stated that “he was confused when initially questioned because he had not
intended to come to Canada and that he had actually forgotten that he had it in
his pocket”: statement of defence, para. 9.
[13]
Soon afterward, Mr. Williams’ currency “was seized as forfeit,” purportedly under the authority
of section 18(1) of the Act: statement of defence, para. 10. As a result of a
later administrative decision, the Minister decided that $2,020.00 USD should
be returned to Mr. Williams because it was proven to be legitimate in origin:
statement of defence, paras. 11-13. The rest, $8,738.00 USD, remained seized as
forfeit.
[14]
Upon receipt of the Minister’s decision, Mr.
Williams brought an action in the Federal Court seeking the return of the $8,738.00
USD. This is how an aggrieved person can obtain review of the Minister’s
decision: Act, section 30. Mr. Williams also seeks pre-judgment interest running
from the date of seizure on the full amount originally seized from him, as none
of it has been returned to him.
C. The Act
[15]
The Act creates a regime for the regulation of
currency and monetary instruments imported or exported by cross-border
travellers. Under the Act, any amount of currency and monetary instruments may
be imported or exported.
[16]
But there is a reporting requirement in
subsection 12(1) of the Act. Under this subsection, cross-border travellers must
report “the importation or exportation of [domestic and
foreign] currency or monetary instruments” equal or greater than a
reporting threshold. The reporting threshold is $10,000.00 CAD: Cross-border
Currency and Monetary Instruments Reporting Regulations, SOR/2002-412, s.
2(1).
[17]
Thus, the objective of the Act is not to prevent
cross-border flows of large amounts of currency and monetary instruments, but
rather to keep track of the cross-border flows. This objective is meant to
fulfil certain larger purposes, including, broadly speaking, the detection and
prevention of money laundering, terrorist financing and organized crime. These
are explicitly set out in section 3 of the Act:
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3. The object of this Act is
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3. La
présente loi a pour objet :
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(a) to
implement specific measures to detect and deter money laundering and the
financing of terrorist activities and to facilitate the investigation and
prosecution of money laundering offences and terrorist activity financing
offences, including
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a) de mettre en oeuvre des mesures visant à
détecter et décourager le recyclage des produits de la criminalité et le
financement des activités terroristes et à faciliter les enquêtes et les
poursuites relatives aux infractions de recyclage des produits de la
criminalité et aux infractions de financement des activités terroristes,
notamment :
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(i) establishing
record keeping and client identification requirements for financial services
providers and other persons or entities that engage in businesses,
professions or activities that are susceptible to being used for money
laundering or the financing of terrorist activities,
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(i) imposer des
obligations de tenue de documents et d’identification des clients aux
fournisseurs de services financiers et autres personnes ou entités qui se
livrent à l’exploitation d’une entreprise ou à l’exercice d’une profession ou
d’activités susceptibles d’être utilisées pour le recyclage des produits de
la criminalité ou pour le financement des activités terroristes,
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(ii) requiring
the reporting of suspicious financial transactions and of cross-border
movements of currency and monetary instruments, and
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(ii) établir un
régime de déclaration obligatoire des opérations financières douteuses et des
mouvements transfrontaliers d’espèces et d’effets,
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(iii)
establishing an agency that is responsible for ensuring compliance with Parts
1 and 1.1 and for dealing with reported and other information;
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(iii)
constituer un organisme chargé du contrôle d’application des parties 1 et 1.1
et de l’examen de renseignements, notamment ceux portés à son attention au
titre du sous-alinéa (ii);
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(b) to
respond to the threat posed by organized crime by providing law enforcement
officials with the information they need to deprive criminals of the proceeds
of their criminal activities, while ensuring that appropriate safeguards are
put in place to protect the privacy of persons with respect to personal
information about themselves;
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b) de combattre le crime organisé en
fournissant aux responsables de l’application de la loi les renseignements
leur permettant de priver les criminels du produit de leurs activités
illicites, tout en assurant la mise en place des garanties nécessaires à la
protection de la vie privée des personnes à l’égard des renseignements
personnels les concernant;
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(c) to
assist in fulfilling Canada’s international commitments to participate in the
fight against transnational crime, particularly money laundering, and the
fight against terrorist activity; and
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c) d’aider le Canada à remplir ses
engagements internationaux dans la lutte contre le crime transnational,
particulièrement le recyclage des produits de la criminalité, et la lutte
contre les activités terroristes;
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(d) to enhance Canada’s capacity to take targeted measures
to protect its financial system and to facilitate Canada’s efforts to
mitigate the risk that its financial system could be used as a vehicle for
money laundering and the financing of terrorist activities.
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d) de renforcer la capacité du Canada de
prendre des mesures ciblées pour protéger son système financier et de
faciliter les efforts qu’il déploie pour réduire le risque que ce système
puisse servir de véhicule pour le recyclage des produits de la criminalité et
le financement des activités terroristes.
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[18]
In order to advance these larger purposes,
reports under subsection 12(1) are sent to the Financial Transactions and
Reports Analysis Centre of Canada (FINTRAC): subsection 12(5) of the Act. The Customs
Act also allows information obtained through these reports to be shared
widely in certain circumstances: see, e.g., paragraphs 107(4)(c)
and 107(5)(k) of the Customs Act, R.S.C. 1985, c. 1 (2nd Supp.).
[19]
In support of this regime, the Act provides for
the temporary retention of imported or exported currency and monetary
instruments (section 14), the interception of mail (sections 17 and 21) and for
searches of persons (section 15) and conveyances (section 16).
[20]
The Act also provides that where a border
services officer has reasonable grounds to believe that a person has not
reported under subsection 12(1) of the Act the importation or exportation of
currency or monetary instruments exceeding the reporting threshold, the
currency or monetary instruments may be “seize[d] as
forfeit” (section 18). In this case, the parties are agreed that if in
fact Mr. Williams was not under an obligation to report his currency under
subsection 12(1) of the Act, the border services officer had no reasonable
grounds to seize the currency.
[21]
Considering the basic facts of this case and
this legislative regime as explained thus far, one might conclude that the
seizure of currency from Mr. Williams was authorized by law. He carried currency
in excess of $10,000.00 CAD across the border and did not report it. On its
face, subsection 12(1) requires that a report be made in circumstances such as
these. And, as mentioned, section 18 allows for the currency to be seized where
a report is not made when it should have been made.
[22]
But that conclusion would be too hasty. For
there is another section in the Act that Mr. Williams says relieves him from
making a report under subsection 12(1). It is section 13.
[23]
Section 13 allows a person who is required to
report currency to “decide not to proceed further with
importing or exporting” the currency “at any
time” before the currency is retained under section 14 or forfeited
under section 18. The parties agree that to trigger section 13 a person must
not only make the decision not to proceed further with the importation or
exportation but must state the decision to the border services officer.
[24]
If, as here, a person triggers section 13 immediately
upon arrival in Canada—i.e., in effect states that he is not importing
anything into Canada—does the person have to make a report under subsection
12(1) of the Act?
[25]
The answer to this legal question determines the
outcome of this case:
● If the answer is yes—i.e., even
though Mr. Williams triggered section 13, he still had to make a report under
subsection 12(1) of the Act—then Mr. Williams’ failure to comply with
subsection 12(1) of the Act is sufficient legal authority for the forfeiture of
the currency under section 18 of the Act. As mentioned, section 18 allows for
the currency to be seized where an officer has reasonable grounds to believe
that a report that should have been made under the Act is not made. Thus, the
currency was properly seized.
● If
the answer is no—i.e., Mr. Williams triggered section 13 and so he did
not need to make a report under subsection 12(1) of the Act—then Mr. Williams did
not offend subsection 12(1) of the Act. This changes everything: the
prerequisite for section 18—which authorizes seizure only when there is a
reasonable belief that a report is required and not made—is not present. Thus, there
is no legal authority for the seizure of Mr. Williams’ currency under section
18 of the Act and so Mr. Williams should get his currency back.
D. Mr. Williams’ position
[26]
Immediately upon arriving in Canada, Mr.
Williams announced he was accidentally in Canada and later, consistent with
this, stated that did not intend to be in Canada. This is the expression of a
decision not to enter Canada and, thus, not to import anything into Canada.
Section 13 allows him to announce this “at any time”
before the currency is retained or forfeited. Mr. Williams says that this
includes the time before a report is made under subsection 12(1) of the Act. He
emphasizes the words “at any time.”
[27]
Thus, according to Mr. Williams, the trigger for
making a report under subsection 12(1)—the “importation
or exportation” of currency over $10,000.00 CAD—was not present.
According to Mr. Williams, he was not obligated to report that he was importing
currency because he had already expressed his decision not to import the
currency under section 13.
E. The Federal Court’s decision
[28]
The Federal Court rejected Mr. Williams’
submissions. It adopted those of the Minister. In this Court, the Minister
adopts the reasoning of the Federal Court.
[29]
The Federal Court held (at para. 14) that the
obligation to report to the officer “the importation…of
currency” over $10,000.00 CAD in subsection 12(1) of the Act “is the first step in the importation of currency”.
[30]
In the Federal Court’s view, the decision “not to proceed further with importing or exporting”
the currency can only be taken after the report under subsection 12(1) of the
Act has been made. Only after the report can a person “choose
to ‘opt out’ of the importation pursuant to section 13” (at para. 16).
[31]
According to the Federal Court, the fact that
Mr. Williams did not intend to enter Canada “is
irrelevant to his obligation to report and to answer truthfully the questions”
asked by the border services officer under subsection 12(1) of the Act (at
para. 18). In its view, interpreting section 13 in the manner suggested by Mr.
Williams is inconsistent with the reporting obligations imposed by subsection
12(1) of the Act. In effect, the obligation to report under subsection 12(1)
takes primacy over section 13.
[32]
Therefore, according to the Federal Court, the
border services officer in this case—who had a belief on reasonable grounds
that Mr. Williams did not make the required report under subsection 12(1)—had
the power under section 18 of the Act “to seize as
forfeit the currency.”
[33]
In reaching its decision,
the Federal Court did not analyze the role of the words “at any time” in section 13. The effect of its decision is to interpret “at any time” to mean “any
time after a report has been made under subsection 12(1) of the Act”; as a result, a decision not to import under
section 13 does not displace the reporting requirement imposed by subsection
12(1) of the Act.
F. Analysis
(1) Was section 13 of the Act triggered by Mr.
Williams?
[34]
The Federal Court proceeded on the basis that
Mr. Williams had triggered section 13. In my view, on this issue, the Federal
Court did not commit any reversible error.
[35]
Most cross-border travellers are not knowledgeable
about the law. Section 13 does not require them to use a particular, exact
series of words to trigger section 13. Thus, the substance, not the form, of
what the traveller says must be examined.
[36]
The Minister’s statement of defence concedes
that immediately upon arrival in Canada and before the border services officer
asked Mr. Williams any questions, Mr. Williams told the border services officer
that he arrived in Canada accidentally. Later, in secondary inspection, but
before his currency was seized as forfeit under section 18, Mr. Williams stated
that he did not intend to enter Canada, thereby confirming his earlier
statement. His words can only as construed as meaning that he was going
straight back to the United States.
[37]
Mr. Williams was carrying his currency on his
person. One cannot import into Canada something on one’s person unless one
enters Canada. In the circumstances of this case, Mr. Williams’ statement that
he did not intend to enter Canada is in substance a statement that he did not intend
to import anything on his person into Canada. If he was going straight back to
the United States, he was not importing anything into Canada.
[38]
Viewed in these circumstances, Mr. Williams did
the objective act required to trigger section 13, the communication of a
decision not to import. I conclude that Mr. Williams triggered section 13.
[39]
In light of the foregoing, the Federal Court was
entitled in these circumstances to proceed on the basis that Mr. Williams
triggered section 13. So shall we.
[40]
Thus, the legal question posed earlier now must
be answered: if, as here, a person triggers section 13 immediately upon arrival
in Canada—i.e., in effect states that he is not importing anything into
Canada—does the person have to make a report under subsection 12(1) of the Act?
To answer this, we must interpret the relevant provisions of the Act.
(2) Interpreting the relevant provisions of
the Act
[41]
We are to interpret the relevant
provisions of the Act in accordance with their text, context and purpose: Re Rizzo & Rizzo Shoes Ltd., [1998] 1 S.C.R. 27, 154 D.L.R. (4th) 193
and Bell ExpressVu Limited Partnership v. Rex, 2002 SCC 42, [2002] 2 S.C.R. 559.
[42]
In this analysis, “[w]hen
the words of a provision are precise and unequivocal, the ordinary meaning of
the words play a dominant role in the interpretive process”: Canada
Trustco Mortgage Co. v. Canada, 2005 SCC 54, [2005] 2 S.C.R. 601 at para.
10.
[43]
Nevertheless, a court must consider the
total context of the provision to be interpreted “no
matter how plain the disposition may seem upon initial reading”: ATCO
Gas and Pipelines Ltd v. Alberta (Energy and Utilities Board), 2006 SCC 4,
[2006] 1 S.C.R. 140 at para. 48.
[44]
Also relevant to the process of legislative
interpretation is that the seizure authorized under the Act operates in a way
similar to absolute liability provisions found in a number of regulatory
statutes. As I shall explain below, under this legislative regime the acts and
omissions of travellers, not their intentions, are alone relevant. This Court
has held that provisions such as these can operate in draconian ways and, thus,
call for careful scrutiny: Doyon v. Canada,
2009 FCA 152, 312
D.L.R. (4th) 142; Maple Lodge Farms Ltd. v. Canadian Food Inspection
Agency, 2017 FCA 45, 411 D.L.R. (4th) 175 at paras. 18-19, citing Canada
v. Kabul Farms Inc., 2016 FCA 143 and Canada v. Guindon, 2013 FCA
153, 360 D.L.R. (4th) 515 at paras. 54-55.
[45]
I wish to offer some additional guidance
concerning legislative interpretation. For clarity, none of this guidance should
be construed as a comment on how the Federal Court interpreted the Act.
[46]
Legislative interpretation can be tricky. One
must be on guard not to introduce extraneous considerations into the proper,
objective analysis of the text, context and purpose of legislation.
[47]
Personal evaluations of the moral conduct of the
parties, good or bad, should play no role in the analysis. In the case before
us, we have a cross-border traveller who falsely declared to a border services
officer how much currency he was carrying. In cases like this, some might let
their reaction to the facts skew their interpretation of the legislation. That
would be wrong.
[48]
Also wrong would be to permit personal policies
or political preferences to play a part in our interpretation of the
legislation: for example, to aim for a result we personally prefer, to fasten
onto what we like and ignore what we don’t, or to draw upon what we think is
best for Canadian society. Common to these practices is an analytical focus on what
we want the legislation to mean rather than on what the legislation
authentically means.
[49]
In our legal system, the starting point
is that only elected legislators—not unelected judges—have the “exclusive”
power to express their personal policies or political preferences in binding legislation:
see the opening words of ss. 91 and 92 of the Constitution
Act, 1867. These words enshrine a principle won four centuries ago at the
cost of much bloodshed: for a recent restatement and discussion of the principle,
see R (Miller) v Secretary of State for Exiting the European Union,
[2017] UKSC 5, [2017] 2 W.L.R. 583 at paras. 40-46. The only exception
is where legislation expressly delegates the power to legislate: see Hodge
v. The Queen (1883), 9 App. Cas. 117, 9 C.R.A.C. 13 (J.C.P.C.)
(regulations made by delegatees) and In Re Gray (1918), 57 S.C.R. 150,
42 D.L.R. 1 (orders akin to legislation made by delegatees). But even then the delegation often must meet strict requirements
of a constitutional nature: see, e.g., Eurig Estate (Re),
[1998] 2 S.C.R. 565, 165 D.L.R. (4th) 1, Ontario Home Builders’ Association
v. York Region Board of Education, [1996] 2 S.C.R. 929, 137 D.L.R. (4th)
449 and Ontario Public School Boards’ Assn. v. Ontario (Attorney General)
(1997), 151 D.L.R. (4th) 346 at pp. 362-365, 45 C.R.R. (2d) 341 at pp. 356-359
(Ont. Gen. Div.) (discussion of Henry VIII clauses).
[50]
Absent a successful argument that legislation is
inconsistent with the Constitution, judges—like everyone else—are bound by the
legislation. They must take it as it is. They must not insert into it the meaning
they want. They must discern and apply its authentic meaning, nothing else.
[51]
How do we go about this? As the authorities
suggest, we are to investigate the text, context and purpose of the legislation
as objectively and fairly as we can. On this, especially when investigating the
purpose, we have assistance: the Interpretation Act, R.S.C. 1985, c.
I-2, canons of statutory construction known to both legislative drafters and
courts, and other legitimate aids to interpretation
such as—in certain circumstances and with appropriate caution—extraneous,
contemporaneous materials (e.g., regulatory impact or official
explanatory statements), legislative debates, and legislative history.
[52]
A frequently used tool in the interpretive process
is to assess the likely effects or results of rival interpretations to see
which accords most harmoniously with text, context and purpose. This is
appropriate. The judge is assessing effects or results not to identify an
outcome that accords with personal policies or political preferences. Rather
the judge is assessing them against the standard, accepted markers of text,
context and purpose in order to discern the authentic meaning of the
legislation. For example, if the effect of one interpretation offends the
legislative purpose but the effect of another interpretation does not, the
latter may be preferable to the former.
[53]
With these thoughts front of mind, I turn first to
the purposes of the Act. While the Act’s primary objectives, as set out in section
3, are to detect and prevent money laundering, terrorist financing and
organized crime, both parties agree that section 13 is aimed at a different
objective, namely to “[ensure] that appropriate
safeguards are put in place to protect the privacy of persons with respect to
personal information about themselves”: subsection 3(b) of the
Act. Section 13, as interpreted by Mr. Williams, is consistent with this
purpose. A person who has expressed his or her intention not to import currency
into Canada need not make a report under subsection 12(1). The information that
would have otherwise been disclosed in a report and shared with other agencies remains
private.
[54]
On the Minister’s view of the matter, it is
difficult to see what role section 13 plays.
[55]
Parliament did not legislate section 13 into
existence for no reason. An accepted canon of construction is that legislators
do not legislate in vain. So what is behind section 13? What does expression of
the decision not to import under section 13 give to a cross-border traveller?
[56]
Section 13 can only mean that once a
person expresses a decision not to import, that person need not report under
the Act. This advances the purpose of
protecting “the
privacy of persons with respect to personal information about themselves”
(subsection 3(b) of the Act). Once a person
makes a currency report under subsection 12(1) of the Act, the person’s privacy
interests evaporate. All reports “shall” be sent
to the FINTRAC who can then, in certain circumstances and for certain purposes,
share that information with local police forces, the Canada Revenue Agency,
provincial securities regulators, the Canada Border Services Agency, the
Communications Security Establishment, Canadian Security and Intelligence
Services, and even foreign governments—and the Customs Act also allows
information obtained through a currency report to be shared widely across
government institutions in certain circumstances, including FINTRAC: see, e.g.,
sections 12(5), 55(3), 55.1, 56 and 56.1 of the Act and paragraphs 107(4)(c)
and 107(5)(k) of the Customs Act.
[57]
In response to questioning by the Court, the
Minister was unable to identify a plausible role for section 13. In all of the
Minister’s proposed interpretations of section 13, the cross-border traveller
must make a truthful report before section 13 could be invoked. But once a
report is made, the horse has long left the barn. If section 13 does not
eliminate the requirement to report and prevent all these privacy-diminishing
consequences, it has no practical use. Allowing a person under section 13 not
to give a report averts these consequences and furthers an important purpose
under subsection 3(b) of the Act—“ensuring that
appropriate safeguards are put in place to protect the privacy of persons with
respect to personal information about themselves.”
[58]
Now to a consideration of context. The Act sits
alongside the Customs Act. The Act does not displace or modify any of
the provisions of the Customs Act. The Customs Act contains
provisions that require individuals presenting themselves to a border services
officer at a border station to answer questions, provide truthful information
and cooperate fully with authorized searches: e.g., sections 11(1), 98,
99, 153.1. The purposes for making full and candid disclosure at a border under
the Customs Act include those under the Act and extend to others.
[59]
These and other obligations under the Customs
Act apply regardless of whether section 13 of the Act applies. Specifically,
a statement by a person that she is turning around and going back immediately
to the United States and not importing anything into Canada does not relieve
that person from answering all questions honestly and cooperating fully under
the Customs Act.
[60]
The Customs Act sets out sanctions for
contraventions of a number of its provisions, sanctions that are separate and
apart from those set out under the Act: Part VI of the Customs Act.
[61]
When the Act and the Customs Act are
reviewed, one can see that violations of the Customs Act do not
constitute a ground for forfeiture of currency under section 18 of the Act. Of
course, contraventions of the Customs Act can result in serious
sanctions. But those sanctions are under the Customs Act. And those
sanctions under the Customs Act do not include seizure under section 18
of the Act.
[62]
In interpreting the Act, some mindful of the
anti-money-laundering and anti-terrorism purposes of the Act might be reluctant
to hold that section 13 relieves people from disclosing necessary information. But
that would be taking an unduly narrow view of the statutory landscape. People
are not relieved from disclosing necessary information. Obligations under the Customs
Act remain. Failure to abide by them can result in serious sanctions.
[63]
The practical effect is that even if Mr.
Williams’ invocation of section 13 of the Act is effective to relieve him of
making a report under subsection 12(1) of the Act, the broad obligations
imposed on him by the Customs Act remain. If the border services officer
asks questions about currency, those obligations include answering those
questions honestly.
[64]
This interpretation is consistent with another
provision in the Act, subsection 14(3). This provides that currency or monetary
instruments retained but not yet seized by a border services officer must be
given back to the person if “the officer is satisfied
that the currency or monetary instruments have been reported under subsection
12(1) [of the Act]” or if “the importer or
exporter…advises the officer that they have decided not to proceed further with
importing or exporting them.” The “or” is
disjunctive. Thus, even if a report has not been made under subsection 12(1) of
the Act, subsection 14(3) requires border services officers to return any
retained currency or monetary instruments once the traveller advises the border
services officer that the currency or monetary instruments are not being
imported—in other words, using the circumstances of Mr. Williams, the person is
turning around and going back to the United States. Subsection 14(3) represents
a slight extension of section 13, which allows a person to express a decision
not to import currency or monetary instruments only until the currency or
monetary instruments are retained. Nevertheless subsection 14(3) confirms the
interpretation that a failure to report is not cause for the forfeiture of
currency or monetary instruments as long as a proper and timely decision not to
import or export is expressed.
[65]
Looking now at the text of section 13, the words
“at any time” before the currency is retained
under section 14 or forfeited under section 18 are, in the words of Canada
Trustco, “precise and unequivocal.” There is
no reason consistent with the purpose of the Act to read them down, especially
in light of the broad disclosure obligations under the Customs Act. In
fact, even if section 13 did not contain the words “at
any time”, it may have been necessary to read those words into section
13 to give meaning to it: R. Sullivan, Sullivan on the
Construction of Statutes (6th ed. 2014), at pp. 211-214.
[66]
Again, looking at the text, the obligation under
subsection 12(1) is to report “the importation…of
currency” over $10,000.00 CAD. Mr. Williams, having declared he was not
intending to enter Canada, was not importing anything. As he was not importing
anything, he had no report of importation to make under subsection 12(1).
[67]
The Minister submits that Mr. Williams’
subjective intention not to import the currency is irrelevant: Azouz v.
Canada (MPSEP), 2009 FC 1222; Zeid v. Canada (MPSEP), 2008 FC 539; Hoang
v. Canada (MPSEP), 2006 FC 182. I agree only insofar as the Minister
suggests that a decision not to import must be expressed to the border services officer and that it is no
defence for a traveller to argue that he or she did not intend to contravene
the reporting requirement or had no knowledge they were in contravention. The
cases cited stand only for these two propositions and neither justifies the
seizure of Mr. Williams’ currency.
[68]
Section 13 as I have interpreted it does not
rely on a subjective intention not to import. To trigger section 13, as the
parties agree, a person must express the decision. In substance, Mr. Williams expressed
to the border services officer his decision not to import. By doing that act,
he triggered section 13.
[69]
In this Court, Mr. Williams is not making any
submissions about his intention. Rather he is submitting that because of his
act of expressing his decision not to import, he cannot be taken in law to be
importing currency. Arriving in Canada by accident, in substance he expressed
his decision to turn around and go back to the United States right away. Thus,
under subsection 12(1), he had no obligation to report “the
importation or exportation of currency.” And thus, there was no basis
for the seizure of his currency under section 18.
[70]
The Minister also points to subsection 12(4) of
the Act which requires travellers to “answer truthfully
any questions asked by the officer in the performance of the officer’s duties
and functions” under Part 2 of the Act and adds that Mr. Williams did
fail to answer truthfully the officer’s question about how much currency he was
carrying, a question that falls under Part 2 of the Act. But this is of no
moment. The forfeiture of the currency under
section 18 is available only on the basis of reasonable grounds to believe
subsection 12(1) is infringed, not subsection 12(4). The text of section 13
does not make it contingent on the cross-border traveller making a report or
making an accurate report; again, it says it
can be invoked “at any time” before the currency
is retained under section 14 or forfeited under section 18. And, as previously
mentioned, recourses may exist under the Act and the Customs Act for Mr.
Williams’ failure to answer questions truthfully, such as the obligation under
subsection 12(4) of the Act: see, e.g., subsection 74(1) of the Act and
sections 11(1), 153, 153.1, 160, 160.1 and 161 of the Customs Act. But
none of those recourses permit the forfeiture of the unreported currency under
section 18 of the Act.
[71]
To reiterate, this interpretation of section
13 does not turn it into something like a “get out of
jail free” card for money launderers, terrorist financiers and other
transnational criminals. The Act and section 13 occupy a small corner in the
broader universe of obligations created by the Customs Act and the
powerful investigatory and enforcement mechanisms that accompany it. Backed by
the threat of significant financial and custodial consequences, border services
officers wield wide-ranging powers under the Customs
Act to question travellers without cause, search travellers and their
possessions, seize those possessions, compel truthful responses, arrest
travellers committing offences under the Criminal Code, R.S.C., 1985, c.
C-46, and share information widely to protect the interests of Canadians and
their institutions of government: see e.g., sections 11(1), 98, 99, 107,
110, 153, 153.1, 160, 160.1, 161, 163.5 of the Customs Act. These powers
and penalties loom large over every cross-border traveller, including Mr.
Williams.
[72]
Section 13 performs a very limited
function at the border: it protects a privacy interest—the amount of currency
or monetary instruments in one’s possession—for individuals who are not
importing currency or monetary instruments. It does not immunize travellers
engaging in unlawful activities.
[73]
For the foregoing reasons, the seizure and
forfeiture of Mr. Williams’ currency was not authorized by law.
[74]
It is not necessary to consider Mr. Williams’
alternative submissions under the Canadian Bill of Rights or the
Charter.
[75]
Nothing in these reasons affects any recourse
under the Customs Act that may exist against Mr. Williams on the facts
of this case.
G. Proposed disposition
[76]
For the foregoing reasons, I would allow the
appeal, set aside the order of the Federal Court, grant Mr. Williams’ motion
for summary judgment with costs of the action and costs here and below on the
motion. Pre-judgment interest should run from the date of seizure until the
return of the currency and should be calculated on the basis that the cause of
action arose in Ontario in accordance with subsection 36(1) of the Federal
Courts Act, R.S.C. 1985, c. F-7.
"David Stratas"
“I agree.
M. Nadon J.A.”
“I agree.
Wyman W. Webb
J.A.”
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