Schulman,
J.
After
entering
a
plea
of
not
guilty,
but
before
and
evidence
was
adduced,
counsel
for
the
accused
moved
for
two
orders:
1.
quashing
all
charges
for
delay;
and
2.
prohibiting
Mr.
Mackoff
or
the
Attorney’
General
of
Canada
from
conducting
the
prosecution
of
count
3
of
the
indictment.
When
the
trial
resumed
on
April
5,
1994,
I
advised
the
parties
that
I
am
dismissing
the
second
branch
of
the
motion
and
that
I
am
deferring
consideration
of
the
first
part
of
the
motion
until
hearing
at
least
part
of
the
evidence.
By
information
sworn
in
November
1989,
the
accused
was
charged
with
249
counts,
248
of
which
allege
breaches
of
the
Income
Tax
Act,
R.S.C.
1952,
c.
148
(am.
S.C.
19707172,
c.
63),
and
one
fraud
under
s.
380
of
the
Criminal
Code,
R.S.C.
1985,
c.
C-42.
The
information
was
sworn
by
Phil
Seagle,
an
employee
of
the
Minister
of
National
Revenue.
There
is
on
file
in
this
court
a
document
signed
by
the
Attorney
General
of
Manitoba
which
provides
as
follows:
The
Attorney
General
of
Manitoba
hereby
authorizes
the
Attorney
General
of
Canada
to
prosecute
the
Criminal
Code
charge
set
out
in
count
3
in
the
attached
copy
of
an
information
sworn
by
Phil
Seagle,
of
the
City
of
Vancouver,
in
the
Province
of
British
Columbia,
an
officer
of
the
Department
of
National
Revenue,
as
follows:
Count
3
Dated
at
Winnipeg,
this
4th
day
of
December,
1989.
J.
C.
McCrae,
Attorney
General
of
Manitoba
On
January
12,
1990,
a
direct
indictment
was
preferred
against
the
accused
on
exactly
the
same
charges.
The
indictment
contains
249
counts.
At
the
bottom
of
the
indictment
the
following
is
set
out:
Paul
William
Halprin,
counsel
for
the
Attorney
General
of
Canada
and,
with
respect
to
Count
3,
Counsel
for
the
Attorney
General
of
Manitoba
I
hereby
consent
to
this
preferral
of
Counts
1,
2
and
4
to
249,
inclusive
of
this
Indictment.
John
Tait,
Deputy
Attorney
General
of
Canada
I
hereby
consent
to
this
preferral
of
Count
3
of
this
Indictment
on
my
behalf.
James
C.
McCrae,
Attorney
General
of
the
Province
of
Manitoba
DEPARTMENT
OF
JUSTICE
On
March
7,
1990,
the
Attorney
General
of
Manitoba
provided
the
following
authorization
(Exhibit
1):
The
Attorney
General
of
Manitoba
hereby
authorizes
the
Attorney
General
of
Canada
to
prosecute
the
Criminal
Code
charge
set
out
in
count
3
in
the
attached
copy
of
an
Indictment
signed
on
January
12,
1990,
by
Paul
William
Halprin,
counsel
for
the
Attorney
General
of
Canada
and,
with
respect
to
count
3,
counsel
for
the
Attorney
General
of
Manitoba,
as
follows:
Count
3:
Did
on
or
about
March
7,
1986,
defraud
or
attempt
to
defraud
Her
Majesty
the
Queen
in
right
of
Canada
of
the
sum
of
$7,942,393.13
by
deceit,
falsehood,
or
other
fraudulent
means,
by
issuing
false
Scientific
Research
and
Experimental
Development
Information
Returns
to
the
limited
partners
of
Organic
Research
Limited
Partnership,
certifying
that
expenditures
in
the
amount
of
$18,923,619.00
were
incurred
by
Organic
Research
Limited
Partnership
for
scientific
research
and
experimental
development
within
the
meaning
of
subsection
37(1)
of
the
Income
Tax
Act,
R.S.C.
1952,
Chapter
148,
as
amended,
which
Returns
were
deceitful,
false
or
fraudulent
in
that
Organic
Research
Limited
Partnership
did
not
incur
expenditures
for
the
purpose
of
scientific
research
and
experimental
development
in
the
amount
stated,
and
did
thereby
commit
an
offence
contrary
to
paragraph
338(l)(a)
of
the
Criminal
Code,
R.S.C.
1970,
Chapter
C-34
[now
paragraph
38O(l)(a)
of
the
Criminal
Code,
R.S.C.
1985,
Chapter
C-461
].
DATED
at
Winnipeg,
this
7th
day
of
March,
1990.
J.
C.
McCrae,
Attorney
General
of
Manitoba
At
a
pre-trial
conference
held
on
February
7,
1994.
counsel
for
the
crown
advised
that
the
crown
will
be
proceeding
on
four
counts,
namely,
counts
1,
2
and
3
and
one
other,
with
the
remaining
counts
being
stayed.
Counts
4
to
249
are
identical
to
one
another,
except
that
they
refer
to
investments
by
different
investors.
The
trial,
which
has
resumed,
is
dealing
with
the
following
counts:
Count
1:
Did
between
December
31,
1984
and
May
3,
1986,
wilfully
evade
or
attempt
to
evade
compliance
with
the
Income
Tax
Act,
R.S.C.
1952,
Chapter
148,
as
amended,
or
payment
of
taxes
in
the
amount
of
$7,942,393.13
imposed
by
the
said
Act
for
the
1985
taxation
year
on
the
limited
partners
of
Organic
Research
Limited
Partnership,
by
providing
to
the
said
limited
partners
false
or
deceptive
documentation
including
T661
Scientific
Research
and
Experimental
Development
Information
Returns
for
Organic
Research
Limited
Partnership
and
did
thereby
commit
an
offence
contrary
to
paragraph
239(1
)(d)
of
the
said
Act.
Count
2:
Did
on
or
about
March
7,
1986,
unlawfully
make,
or
participate
in,
assent
to
or
acquiesce
in
the
making
of
a
false
or
deceptive
statement
in
T661
Scientific
Research
and
Experimental
Development
Information
Returns
of
Organic
Research
Limited
Partnership
for
the
1985
taxation
year,
filed
as
required
by
the
Income
Tax
Act,
R.S.C.
1952,
Chapter
148,
as
amended,
by
stating
therein
that
’Total
Current
Expenditures
Paid
In
The
Year’
for
scientific
research
and
experimental
development
was
the
amount
of
$18,923,619.00,
and
did
thereby
commit
an
offence
contrary
to
paragraph
239(1
)(a)
of
the
said
Act.
Count
3:
Did
on
or
about
March
7,
1986,
defraud
or
attempt
to
defraud
Her
Majesty
The
Queen
in
right
of
Canada
of
the
sum
of
$7,942,393.13
by
deceit,
falsehood,
or
other
fraudulent
means,
by
issuing
false
Scientific
Research
and
Experimental
Development
Information
Returns
to
the
limited
partners
of
Organic
Research
Limited
Partnership,
certifying
that
expenditures
in
the
amount
of
$18,923,619.00
were
incurred
by
Organic
Research
Limited
Partnership
for
scientific
research
and
experimental
development
within
the
meaning
of
Section
37(1)
of
the
Income
Tax
Act,
R.S.C.
1952,
Chapter
148,
as
amended,
which
Returns
were
deceitful,
false
or
fraudulent
in
that
Organic
Research
Limited
Partnership
did
not
incur
expenditures
for
the
purpose
of
scientific
research
and
experimental
development
in
the
amount
stated,
and
did
thereby
commit
an
offence
contrary
to
section
380(1
)(a)
of
the
Criminal
Code,
R.S.C.
1985,
Chapter
C-42.
Count
191:
Did
on
or
about
April
30,
1986,
unlawfully
participate
in,
assent
to
or
acquiesce
in
the
making
of
a
false
statement
in
the
return
of
income
of
Edward
H.
Purvis
for
the
1985
taxation
year,
filed
as
required
by
the
Income
Tax
Act,
R.S.C.
1952,
Chapter
148,
as
amended,
by
providing
false
documentation
for
the
purpose
of
preparing
and
filing
the
said
return
of
income,
resulting
in
the
Total
Income
reported
being
understated
by
$480,000.00
and
the
Investment
Tax
Credit
reported
being
overstated
by
$120,000.00,
contrary
to
paragraph
239(1
)(a)
of
the
said
Act.
Counsel
for
the
accused
made
the
following
submission:
The
Attorney
General
of
Canada
has
the
exclusive
authority
to
prosecute
charges
under
the
Income
Tax
Act.
The
Attorney
General
of
Manitoba
has
the
exclusive
authority
to
prosecute
charges
under
the
Criminal
Code.
Either
Attorney
General
may
properly
delegate
a
counsel
or
an
agent
for
the
prosecution
of
a
charge
within
his
or
her
exclusive
sphere
of
authority,
but
in
order
to
do
so
there
must
be
a
proper
written
delegation
which
states
that
this
prosecution
is
being
conducted
by
X
"as
my
agent".
Referring
to
Exhibit
1,
defence
counsel
states
that
the
document
merely
authorizes
the
Attorney
General
to
prosecute
count
3,
but
it
does
not
state
that
the
prosecution
is
to
be
done
as
agent
for
the
Attorney
General
of
Manitoba.
Pointing
to
a
number
of
circumstances
which
have
taken
place
since
the
authorization
was
signed,
he
argued
that
there
has
been
no
valid
authorization
here,
but
rather
the
fact
is
that
the
Attorney
General
of
Manitoba
abdicated
his
responsibility,
and
the
Attorney
General
of
Canada
is
prosecuting
a
case
which
constitutionally
it
is
not
in
his
power
to
prosecute.
The
circumstances
to
which
Mr.
Wolch
referred
are
as
follows:
1.
On
March
21,
1990,
the
Honourable
James
C.
McCrae,
Attorney
General
of
Manitoba,
wrote
a
letter
to
Mrs.
Seona
Wilder,
the
accused’s
wife,
(Exhibit
190)
in
response
to
a
letter
she
had
written
to
him,
stating
in
part:
Ordinarily
all
prosecutions
within
the
Province
of
Manitoba
under
the
Criminal
Code
of
Canada
would
be
under
my
authority
and
responsibility.
However,
on
this
occasion
because
248
counts
are
under
the
Federal
Income
Tax
Act
and
only
count
3
dealt
with
the
Criminal
Code
of
Canada,
it
was
determined,
in
order
that
there
be
a
uniformity
of
the
handling
of
this
prosecution,
that
counsel
for
the
Attorney
General
of
Canada
would
also
prosecute
count
3
and
I
accordingly
authorized
and
consented
to
this
procedure.
In
view
of
the
fact
that
your
correspondence
to
me
questions
the
prosecution
of
your
husband
on
any
charges,
I
have
taken
the
liberty
of
turning
your
correspondence
over
to
the
appropriate
representative
of
the
Attorney
General
of
Canada
so
that
you
may
obtain
a
response
from
that
office.
2.
Between
May
1990
and
July
1993,
William
Morton,
Q.C.,
a
Senior
Crown
Attorney
employed
by
the
Manitoba
Department
of
Justice,
served
as
Commissioner
in
this
matter,
as
the
evidence
of
11
witnesses
was
taken
during
24
days
in
various
parts
of
the
United
States
pursuant
to
orders
made
by
my
colleague
Krindle
J.
on
April
10,
1990,
September
4,
1990,
and
September
16,
1991.
Mr.
Morton
was
so
appointed
with
the
concurrence
of
defence
counsel,
but
the
point
made
is
that
the
Attorney
General
of
Manitoba
must
have
dissociated
himself
from
the
prosecution
if
a
senior
official
of
his
Department
were
to
fill
the
objective
position
of
Commissioner.
3.
Since
March
7,
1990,
neither
the
Minister
nor
any
member
of
his
staff
have
been
directly
involved
in
the
prosecution.
No
written
reports
have
been
made
to
the
Minister
or
his
Department
concerning
progress
in
the
matter.
The
Minister
bears
no
costs
in
relation
to
the
prosecution
(Exhibits
188
and
189).
Counsel
for
the
crown
submitted
that
Exhibit
1
is
all
that
is
required
in
the
way
of
a
written
authorization.
He
advised
the
court
that
his
instructions
come
from
both
the
Attorney
General
of
Canada
and
the
Attorney
General
of
Manitoba.
He
stated
that
if
he
were
to
consider
entering
a
stay
of
proceedings
to
count
3
he
would
first
have
to
consult
with
the
Attorney
General
of
Manitoba,
and
if,
after
trial
of
count
3
he
wished
to
conduct
an
appeal,
he
would
have
to
obtain
authority
from
the
Attorney
General
of
Manitoba
for
doing
so.
The
word
"authorization"
has
at
least
two
meanings:
one
which
involves
handing
over
authority
to
another
person
who
does
not
otherwise
have
the
authority
to
do
something;
and
the
other
which
involves
handing
over
the
authority
to
act
as
agent
of
the
giver
of
the
authority.
When
a
police
officer
applies
to
a
judge
of
this
court
for
permission
to
wiretap
pursuant
to
s.
185
of
the
Criminal
Code,
he
or
she
obtains
an
authorization,
and
in
that
context
the
police
officer
is
not
acting
as
an
agent
of
this
court.
The
police
department
is
charged
with
the
responsibility
of
investigating
crimes.
This
court
is,
by
statute,
empowered
to
give
to
a
police
officer
authority
which
he
or
she
does
not
otherwise
hold.
In
my
opinion,
that
is
not
the
sense
in
which
the
word
"authorize”
is
used
in
Exhibit
1.
By
our
Constitution,
the
Attorney
General
of
Manitoba
has
the
sole
responsibility
to
conduct
prosecutions
for
alleged
breaches
of
the
Criminal
Code.
The
Attorney
General
of
Manitoba
cannot
personally
conduct
the
numerous
prosecutions
which
take
place
in
Manitoba
from
day
to
day.
When
the
Attorney
General
authorizes
someone
to
conduct
a
prosecution,
it
is
implicit
that
the
authority
is
given
to
prosecute
as
agent
or
counsel
for
the
Attorney
General
of
Manitoba.
That
is
the
situation
which
I
find
exists
here.
Both
counsel
referred
to
the
recently-reported
decision
of
R.
v.
Luz
(1988),
5
O.R.
(3d)
52
(H.C.J.).
In
that
case,
Campbell
J.
held
that
a
letter
from
a
crown
attorney
stating
at
page
O.R.
56,
"I
hereby
delegate
to
you
...
the
authority
to
prosecute”
was
a
sufficient
delegation
to
a
federal
crown
attorney
to
prosecute
a
Criminal
Code
offence
in
the
same
information,
along
with
a
related
narcotics
offence.
There
was,
in
the
Luz
case,
no
reference
to
"as
agent
of".
In
the
Luz
case,
Campbell
J.
made
reference
to
three
factors
as
being
indicative
of
a
valid
delegation:
firstly,
that
the
provincial
Attorney
General
remain
accountable
to
the
legislature
for
the
way
the
prosecution
is
conducted;
secondly,
that
there
be
a
line
of
communication
between
the
Attorney
General
and
the
prosecutor;
as
required,
throughout
the
case;
and
thirdly,
that
the
Attorney
General
retains
ultimate
control
over
the
prosecution.
In
my
view,
the
decisive
feature
of
the
third
factor
is:
Does
the
provincial
Attorney
General
retain
the
ultimate
authority
to
decide
whether
the
charges
be
stayed,
and
does
he
or
she
retain
ultimate
authority
in
order
to
decide
whether
or
not
an
appeal
will
be
conducted?
I
find
that
the
Attorney
General
of
Manitoba
has,
at
all
material
times,
been
accountable
to
the
Legislature,
had
a
line
of
communication
with
Mr.
Mackoff
or
Mr.
Halprin,
his
predecessor,
and
had
ultimate
control
over
the
prosecution
of
count
3.
I
find
that
Exhibit
1
clothes
the
Attorney
General
of
Canada
and
Mr.
Mackoff
with
appropriate
authority
to
conduct
the
prosecution
of
count
3
on
behalf
of
the
Attorney
General
of
Manitoba.
I
have
reviewed
the
circumstances
referred
to
by
defence
counsel
as
indicative
of
the
fact
that
the
Attorney
General
of
Manitoba
abdicated
his
responsibility
in
this
case.
I
find
that
there
was
no
abdication
and
that
there
was
a
valid
delegation.
If
the
Attorney
General
of
Manitoba
and
his
advisors
did
not,
in
this
instance,
realize
that
he
retained
ultimate
control
over
the
prosecution,
the
fact
remains
that
he
did.
The
above-mentioned
circumstances
do
not
warrant
a
finding
to
the
contrary.
For
the
above-mentioned
reasons,
this
motion
is
dismissed.
Motion
dismissed.
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