The Queen v. Betterest Vinyl Manufacturing Ltd. And Jesse Allan Holmes, [1989] 1 CTC 197

McTaggart, Co. Ct. J.:—Crown appeal from acquittal of three counts under the Income Tax Act, R.S.C. 1952 c. 148 as amended.

The learned Provincial Court judge refused to admit certain vital Crown evidence, i.e. copies of seized books and records as not being the "best evidence".

As the facts are unusual, the point of law not common, and as counsel submitted at the hearing detailed written argument (a desirable practice), the following comments should be sufficient by way of reasons for judgment:

The Crown advanced two grounds:

1. ”. . . a copy of an original is admissible as secondary evidence where the party presenting the copy can establish that the original cannot be produced and that the copy proffered is a true copy". [My emphasis]

McWilliams, Canadian Criminal Evidence (2nd) (1984) p. 93 says:

As Maule, J., said in Macdonnell v. Evans (1852) 11 C.B. 930 at 942; 138 E.R. 742:

If the document does not exist, or the party seeks to show its contents cannot get at it, he is at liberty to give secondary evidence, because in that case no better is to be had. The parties seeking to adduce secondary evidence must establish the grounds.

[Emphasis added.]

Some seven grounds are then listed. None of these were used in the present case. One Crown witness said:

Q: In answer to one of my friend's questions you said that the documents are not

now available. On what basis do you make that statement?

A: We returned them to the taxpayer.

Q: So did they disappear?

A: I don't really know.

Q: You've not made any effort to determine whether they are in fact available or

not have you?

A: No, I haven't.

(transcript of proceedings Vol. 2, p. 7, line 25)

I do not, with respect, understand the basis of the learned judge's remarks: “Certainly the Crown is not in a position to establish the whereabouts of the original.” (transcript Vol. 2, p. 17, line 35)

This ground is rejected.

2. Notwithstanding the "best evidence" issue, the Crown says that while seizure of the documents was made pursuant to Code section 446, copies were made properly under the Income Tax Act subsection 231(9).

The trial judge said, in part:

In my view the Crown having elected to proceed under the provisions of the Code is bound by the provisions of that section. It cannot rely on other Acts to remedy deficiencies or errors that the Crown has made when acting under another section, namely the provisions of the Code. That is exactly what the Crown seeks to do. In my view they may not and they are bound by the provisions of the section that they initially proceeded under, section 446. I am not prepared to allow the Crown to nor do I think it proper for them to rely on the provisions of what was section 231, particularly it would appear, even if I am wrong, that they have not complied with the provisions of 231 if there is no evidence that they have.

The Crown now relies on the Interpretation Act subsection 27(2); R. v. Print Three Incorporation et al., [1985] 2 C.T.C. 48; 85 D.T.C. 5303; Attorney General of Canada v. Dewer (1979), 49 C.C.C. (2d) 533 (Ont. H.C.); R. v. King, [1972] 6 W.W.R. 126 (Sask. C.A.); R. v. Moulis, [1980] 2 S.C.R. 356. It would seem that these authorities were not cited to the learned trial judge.

The position of the respondent is that “switching hats” is not possible. If the Crown can rely on the Income Tax Act subsection 231(9) then it must meet the provisions of that section and subsections which specifically deal with the audit, production and seizure of business records from the premises where they are normally kept. Further, subsection 231(9) says:

(9) Copies. Where any book, record or other document has been seized, examined or produced under this section, the person by whom it is seized or examined or to whom it is produced or any officer of the Department of National Revenue may make, or cause to be made, one or more copies thereof and a document purporting to be certified by the Minister or a person thereunto authorized by the Minister to be a copy made pursuant to this section is admissible in evidence and has the same probative force as the original document would have if it had been proven in the ordinary way.

[Emphasis added]

The respondent submits an inference arises (not rebutted) that the copying was done at the offices of the Department of National Revenue. Paragraph 231(1)(d), which permits the documents, books, records and papers to be removed from the business premises,, has been declared ultra vires (Print Three (supra)). In short, says the respondent, the defendant was not acting within the scope of section 231.

After consideration, I am of the opinion that even if the Crown can “switch hats" the new hat must fit the intent and requirements of the Income Tax Act, subsection 231(9). I reject this ground.

In any case, the finding of the learned trial judge is consistent with the general principal that penal and taxing statutes are to be construed strictly (see: The Construction of Statutes by E.A. Driedger (1974) p. 148 et seq.).

In the result, the appeal is dismissed.

Appeal dismissed.