Rosenberg,
J:—This
is
an
application
to
quash
the
retention
order
made
by
the
Honourable
Judge
Kenneth
William
Warrender
on
the
first
day
of
April,
1980.
The
application
was
originally
made
“pursuant
to
Rule
4
of
the
Rules
respecting
Criminal
Proceedings”.
At
the
opening
of
argument,
the
applicants’
counsel
advised
that
the
application
was
not
being
brought
under
the
Rules
respecting
Criminal
Proceedings
and
that
these
rules
had
been
inadvertently
referred
to
in
the
framing
of
the
application.
I
advised
counsel
for
the
Attorney
General
that
under
the
circumstances
if
she
was
taken
by
surprise,
I
would
adjourn
the
matter
to
allow
time
to
respond
to
this
change
in
position.
She
elected
to
waive
the
irregularity.
Facts
1.
Frank
Pica
and
Antony
Pica
are
officers
of
all
of
the
corporate
applicants
but
Astro
Form
Construction
Limited
(“Astro”).
Their
father
is
apparently
the
president
of
Astro.
2.
Pro
Form
Construction
Limited
(“Pro
Form”)
and
Astro
failed
to
remit
income
tax,
unemployment
insurance
and
Canada
Pension
Plan
source
deductions
for
part
of
the
year
1977
as
a
result
of
their
banker’s
refusal
to
honour
any
further
cheques
written
by
them.
3.
The
Department
of
National
Revenue
(“Revenue
Canada”)
attempted
to
recover
the
remittances
that
Pro
Form
and
Astro
were
unable
to
make
by
reassessing
Frank
Pica
and
Antony
Pica
(the
Picas).
The
Picas
filed
notices
of
objections
to
the
reassessment.
Revenue
Canada
withdrew
its
reassessment,
and
all
moneys
received
from
the
Picas
as
a
result
of
the
reassessments
were
returned.
4.
In
August
1979,
the
Collections
Section
of
Revenue
Canada
referred
the
file
to
the
Special
Investigations
Division
and
the
investigative
officer
reviewed
the
financial
statements
and
income
tax
returns
of
the
applicants.
5.
On
December
4,
1979,
three
members
of
Revenue
Canada
attended
at
the
business
premises
of
the
applicants
and
seized
documents,
books,
records,
papers
and
other
things
belonging
to
the
applicants
(“the
documents”)
under
the
authority
of
paragraph
231(1)(b)
of
the
Income
Tax
Act.
The
operation
took
two
and
one-half
to
three
hours
and
the
documents
seized
were
all
of
the
documents
of
the
applicants
that
were
financial
in
nature.
All
documents
on
the
premises
were
taken.
The
documents
filled
twenty-one
boxes
and
related
to
the
years
1973
through
1979.
6.
On
December
20,
1979
Revenue
Canada
held
a
meeting
with
the
Picas
and
Mr
Nichols,
their
solicitor.
The
Picas
delivered
to
Revenue
Canada
certain
documents
that
they
had
in
their
home
which
were
seized
pursuant
to
231(l)(d).
7.
At
that
meeting,
the
Picas
and
Mr
Nichols
were
informed
that
Revenue
Canada
was
going
to
examine
the
circumstances
surrounding
the
non-remittance
to
see
if
the
direct
cause
of
the
non-remittance
was
some
wrongdoing
by
the
Picas.
Mr
Nichols
was
advised
that
if
it
were
found
that
wrongdoing
was
not
as
a
direct
cause
of
the
non-remittance
that
no
prosecution
would
take
place.
The
respondents
acknowledged
in
their
evidence
and
in
their
statement
filed
on
this
motion,
that
the
attendance
at
the
premises
of
the
applicants
was
“in
order
to
obtain
more
information
concerning
the
deficient
remittances
on
account
of
source
deductions
and
the
reason
therefor”.
8.
On
March
28,
1980,
an
application
was
made
by
J
R
Giles,
Director
of
Taxation,
Hamilton
and
District
Office
of
Revenue
Canada
to
retain
the
documents
after
the
expiration
of
the
120
day-period,
referred
to
in
subsection
231(2)
of
the
Income
Tax
Act.
An
affidavit
of
Carolyn
Davis
was
filed
in
support
of
that
application.
On
April
1,
1984
an
order
was
made
by
the
Honourable
Judge
Kenneth
William
Warrender
(“the
retention
order”)
authorizing
the
retention
of
the
documents.
9.
The
proceedings
by
the
Hamilton
District
Office
before
Judge
Warrender
were
far
from
satisfactory:
(a)
The
order
referred
to
“the
seized
documents,
books,
records,
papers
or
things
are
or
may
be
required
in
relation
to
proceedings
against
the
said
Tony
Pica
and
Antony
Pica’’.
No
mention
whatsoever
was
made
of
Frank
Pica.
(b)
The
affidavit
sworn
by
Carolyn
Davis,
which
was
the
only
material
in
support
of
the
application,
swore
as
to
her
personal
belief
rather
than
the
belief
of
the
Minister
as
required
by
the
act.
10.
Far
more
important
however
than
the
shortcomings
of
the
documentation,
is
the
failure
of
the
District
Office
to
act
in
good
faith.
The
applicant
became
aware
as
a
result
of
evidence
given
at
the
commencement
of
the
prosecution
hearing
on
October
30,
1984
that:
(a)
Between
the
date
of
the
seizure
and
the
date
of
the
application
for
the
retention
order,
nothing
was
done
by
Revenue
Canada
with
regard
to
investigation
of
the
matter
or
the
examination
of
the
documents
other
than
the
compilation
of
an
index
of
documents
seized
and
notification
to
the
applicants
that
the
documents
could
be
viewed
in
the
offices
of
Revenue
Canada.
They
made
no
efforts
at
the
time
of
the
seizure
to
determine
which
documents
related
to
the
“cause
of
the
non-remittance’’
nor
to
determine
how
long
it
would
take
to
examine
them
and
whether
or
not
it
was
possible
to
do
so
within
the
120
days
specified
in
the
act.
(b)
In
the
testimony
of
Miss
Davis
on
the
30th
day
of
October,
1984
it
was
disclosed
that
she
had
from
the
beginning
been
looking
for
other
possible
breaches
of
the
Income
Tax
Act.
The
procedure
adopted
by
the
District
Taxation
Office
in
this
case
was
characterized
by
Mr
Speigel
on
the
applicants’
behalf
as
a
“fishing
expedition’’.
The
Taxation
Office
seized
all
documents
and
retained
them
for
a
period
of
years.
They
spent
3,600
man
hours
looking
for
possible
offences
before
laying
a
charge.
This
is
not
what
is
contemplated
or
permitted
by
the
section
of
the
Act.
The
affidavit
in
support
of
the
retention
order
refers
only
to
the
failures
to
remit.
The
applicants
were
cleared
of
any
wrongdoing
in
that
connection.
The
charges
do
not
relate
to
the
failure
to
remit.
The
evidence
given
at
the
opening
of
the
prosecution
makes
it
clear
that
the
actions
of
the
District
Taxation
Office
throughout
were
inappropriate.
The
Picas
have
been
charged
with
income
tax
evasion.
It
is
alleged
that
the
Picas
in
their
personal
capacity
and
as
officers
and
directors
of
the
applicants
overstated
expenses
and
understated
income.
The
trial
commenced
on
October
29,
1984
and
at
the
commencement
of
trial
a
motion
was
brought
by
the
Picas
alleging
that
the
charges
were
statute
barred
under
subsection
244(4)
of
the
Income
Tax
Act
and
in
the
alternative
that
documents
and
evidence
relating
to
seizures,
which
the
Picas
alleged
were
illegal,
should
not
be
admitted
into
evidence.
The
learned
trial
judge
ruled
that
the
charges
were
not
statute
barred
and
that
all
seized
documents
were
admissible.
A
motion
for
prohibition
was
brought
and
argued
before
the
Honourable
Mr
Justice
Montgomery
on
November
27th
and
28th
1984
and
a
decision
dismissing
the
motion
was
rendered
in
January
1985,
[1985]
1
CTC
73.
The
decision
of
Mr
Justice
Montgomery
is
being
appealed
and
I
am
advised
that
the
appeal
is
not
likely
to
be
heard
for
many
months.
Issues
There
are
three
major
issues:
1.
Were
the
seizures
made
December
4
and
December
20,
1979
illegal?
2.
Should
the
retention
order
of
March
28,
1980
be
quashed.
3.
In
the
event
that
the
applicants
are
successful
with
regard
to
No
2,
should
the
documents
and
all
copies
be
returned
to
the
applicants.
Were
the
Seizures
Illegal?
Paragraphs
231(l)(a)
and
(d)
provide
as
follows:
231.
(1)
Any
person
thereunto
authorized
by
the
Minister,
for
any
purpose
related
to
the
administration
or
enforcement
of
this
Act,
may,
at
all
reasonable
times,
enter
into
any
premises
or
place
where
any
business
is
carried
on
or
any
property
is
kept
or
anything
is
done
in
connection
with
any
business
or
any
books
or
records
are
or
should
be
kept,
and
(a)
audit
or
examine
the
books
and
records
and
any
account,
voucher,
letter,
telegram
or
other
document
which
relates
or
may
relate
to
the
information
that
is
or
should
be
in
the
books
or
records
or
the
amount
of
tax
payable
under
this
Act.
(d)
if,
during
the
course
of
an
audit
or
examination,
it
appears
to
him
that
there
has
been
a
violation
of
this
Act
or
a
regulation,
seize
and
take
away
any
of
the
documents,
books,
records,
papers
or
things
that
may
be
required
as
evidence
as
to
the
violation
of
any
provision
of
this
Act
or
a
regulation.
[Emphasis
added]
The
evidence
must
relate
to
the
violation
and
not
to
some
other
violation
or
a
possible
violation
not
uncovered
by
the
person
doing
the
audit.
This
is
particularly
true
in
light
of
the
fact
that
the
section
is
an
interference
with
the
freedom
and
property
rights
of
the
individual.
In
the
case
of
Kelly
Douglas
and
Company
Limited
v
The
Queen
et
al,
[1981]
CTC
457;
82
DTC
6036;
129
DLR
(3d)
154
MacDonnell,
J,
stated
at
461
[6039]:
As
I
view
s
231(4),
it
is
to
be
considered
in
two
parts.
The
first
part
is
the
entry
and
search
for
evidence,
the
second
is
the
seizure
of
evidence.
They
are
not
the
same
thing
as
the
only
seizure
that
is
authorized
is
of
documents
that
may
afford
evidence
of
a
violation.
If
no
documents
are
found
in
the
search
that
may
afford
evidence,
then
nothing
can
be
seized.
Likewise,
the
authorization
does
not
permit
documents
to
be
taken
that
have
not
been
examined
or
searched
for
their
evidentiary
value
in
proving
a
violation.
[Emphasis
added]
The
principles
of
due
process
of
law
are
of
some
value
in
assessing
what
happens
following
the
authorization.
The
manner
of
seizure
and
what
is
seized
must
meet
the
due
process
of
law
test.
Looked
at
another
way,
the
section
must
be
examined
to
see
what
can
be
seized
and
taken
away.
It
is
my
view
that
for
the
officers
of
the
Tax
Department
to
lawfully
deprive
a
person
of
his
“enjoyment
of
property”
it
can
only
be
done
by
“due
process
of
law”
as
provided
in
the
Bill
of
Rights.
This
means,
in
my
view,
when
applied
to
s
231(4)
of
the
Income
Tax
Act,
that
only
documents
that
may
afford
evidence
of
violations
may
be
seized.
Due
process
prohibits
the
seizure
of
documents
that
do
not
afford
evidence
of
violations.
Therefore,
a
wholesale
seizure
is
not
authorized.
The
scheme
of
the
Act
is
not
to
seize,
then
search
—
but
to
search,
and
seize
only
documents
that
may
afford
evidence
of
violations.
[Emphasis
added]
and
at
462
[6040]:
.
.
.
There
is
no
right
to
seize,
then
search,
and
if
the
officers
are
not
able
to
say
that
they
seized
documents
that
may
provide
evidence
of
the
breach,
then
those
documents
cannot
be
seized
by
the
Department
and
must
be
returned.
[Emphasis
added]
In
Hunter
et
al
v
Southam
Inc
(1984),
84
DTC
6467
(SCC),
Dickson,
J
said
at
6472:
Historically,
the
common
law
protections
with
regard
to
governmental
searches
and
seizures
were
based
on
the
right
to
enjoy
property
and
were
linked
to
the
law
of
trespass.
It
was
on
this
basis
that
in
the
great
case
of
Entick
v
Carrington
(1765),
19
State
Tr
1029
the
Court
refused
to
countenance
a
search
purportedly
authorized
by
the
executive,
to
discover
evidence
that
might
link
the
plaintiff
to
certain
seditious
libels.
Lord
Camden
prefaced
his
discussion
of
the
rights
in
question
by
saying,
at
p
1066:
The
great
end,
for
which
men
entered
into
society,
was
to
preserve
their
property.
That
right
is
preserved
sacred
and
incommunicable
in
all
instances
where
it
has
not
been
taken
away
or
abridged
by
some
public
law
for
the
good
of
the
whole.
The
defendants
argued
that
their
oaths
as
Kings’
messengers
required
them
to
conduct
the
search
in
question
and
ought
to
prevail
over
the
plaintiffs
property
rights.
Lord
Camden
rejected
this
contention,
at
p
1067:
Our
law
holds
the
property
of
every
man
so
sacred,
that
no
man
can
set
his
foot
upon
his
neighbour’s
close
without
his
leave:
if
he
does
he
is
a
trespasser
though
he
does
not
damage
at
all;
if
he
will
tread
upon
his
neighbour’s
ground
he
must
justify
it
by
law.
Lord
Camden
could
find
no
exception
from
this
principle
for
the
benefit
of
Kings’
messengers.
He
held
that
neither
the
intrusions
nor
the
purported
authorizations
were
supportable
on
the
basis
of
the
existing
law.
That
law
would
only
have
countenanced
such
an
entry
if
the
search
were
for
stolen
goods
and
if
authorized
by
a
justice
on
the
basis
of
evidence
upon
oath
that
there
was
“strong
cause”
to
believe
the
goods
were
concealed
in
the
place
sought
to
be
searched.
In
view
of
the
lack
of
proper
legal
authorization
for
the
governmental
intrusion,
the
plaintiff
was
protected
from
the
intended
search
and
seizure
by
the
ordinary
law
of
trespass.
In
my
view
the
interests
protected
by
s
8
are
of
a
wider
ambit
.
.
.
Accordingly,
I
have
come
to
the
conclusion
that
the
original
seizure
was
illegal
and
not
in
accordance
with
the
authorization
in
the
Act.
Should
the
Retention
Order
be
Quashed?
Both
counsel
acknowledged
that
a
valid
seizure
is
a
necessary
condition
precedent
to
a
valid
retention
order.
Accordingly,
the
retention
order
should
be
quashed.
Even
if
the
original
seizure
were
valid,
it
is
my
view
that
the
retention
order
should
be
quashed.
In
the
case
of
Attorney
General
of
Canada
v
Usarco
Limited,
[1980]
CTC
145;
80
DTC
6085;
(1980)
112
DLR
(3d)
325
(Ont
CA),
a
similar
order
was
considered.
That
case
was
an
appeal
by
the
Minister
from
an
order
directing
the
return
of
the
documents,
and
a
cross-appeal
by
the
taxpayer
that
there
was
insufficient
evidence
to
justify
the
original
retention
order
relating
to
the
documents.
The
appeal
was
dismissed
and
the
cross-appeal
was
allowed.
In
allowing
the
cross-appeal,
Morden,
JA
said
at
150
[6089]:
I
agree
with
the
judgment
of
Le
Dain,
J
in
Royal
American
Shows,
Inc
v
His
Honour
Judge
R
McClelland
and
the
Minister
of
National
Revenue,
[1978]
1
FC
72
that
a
proper
s
231(l)(d)
seizure
is
a
jurisdictional
condition
precedent
to
the
making
of
a
valid
retention
order
under
s
231(2);
and
.
.
.
This,
however,
does
not
end
the
matter.
Since
a
lawful
s
231(1)(d)
seizure
is
a
jurisdictional
requirement
for
a
section
231(2)
order,
the
judge
is
not
the
exclusive
arbiter
of
this
issue.
His
conclusion
is
susceptible
to
challenge
on
an
application
for
certiorari
wherein
additional
evidence
may
be
placed
before
the
court.
That
has
been
done
in
this
case.
The
question
now
is:
was
there
a
lawful
s
231(l)(d)
seizure?
Section
231(2)
reads
as
follows:
The
Minister
shall,
(a)
within
120
days
from
the
date
of
seizure
of
any
documents,
books,
records,
papers
or
things
pursuant
to
paragraph
(1)(d),
return
the
documents,
books,
records,
papers
or
things
to
the
person
from
whom
they
were
seized
unless
a
judge
of
a
superior
court
or
county
court,
on
application
made
by
or
on
behalf
of
the
Minister,
supported
by
evidence
on
oath
establishing
that
the
Minister
has
reasonable
and
probable
grounds
to
believe
that
there
has
been
a
violation
of
this
Act
or
a
regulation
and
that
the
seized
documents,
books,
records,
papers
or
things
are
or
may
be
required
as
evidence
in
relation
thereto,
orders
that
they
be
retained
by
the
Minister
until
they
are
produced
in
any
court
proceedings,
which
order
the
judge
is
hereby
empowered
to
give
on
ex
parte
application.
[Emphasis
added]
Section
232(2)
[sic,
231(2)
I
requires
the
judge
to
be
satisfied
by
evidence
on
oath
that
the
Minister
has
reasonable
and
probable
grounds
to
believe
(1)
that
there
has
been
a
violation
of
the
Act
or
a
regulation
and
(2)
that
the
seized
documents
are
or
may
be
required
as
evidence
in
relation
thereto.
In
my
view,
the
evidence
before
the
judge
clearly
fell
short
of
satisfying
requirement
(2)
but,
before
I
deal
with
this
particular
issue
there
are
other
aspects
of
Mr
Banks’
affidavit
that
I
should
mention.
Section
231(2)
requires
the
Minister
(or
by
virtue
of
Regulation
900(5),
it
appears,
the
Director
General,
Compliance,
the
Assistant
Director
General,
Compliance
for
Special
Investigations,
or
any
official
holding
a
position
of
Director
in
the
said
Special
Investigations
of
the
Department
of
National
Revenue,
Taxation)
to
have
reasonable
and
probable
cause
to
believe
in
the
existence
of
the
matters
to
be
covered.
It
may
be
that
the
affidavit
satisfies
this
requirement,
in
an
indirect
way,
in
paragraph
12
where
Mr
Banks
says
that
he
has
reasonable
grounds
to
believe
but
I
cannot
see
any
practical
reason
why
the
affidavit
was
not
addressed
to
the
actual
requirements
of
the
provision.
In
the
same
vein,
the
provision
(at
least,
in
the
English
text)
requires
that
there
be
reasonable
and
probable
grounds.
The
affidavit
refers
only
to
reasonable
grounds.
Further,
paragraph
12
refers
to
a
violation
under
s
239
of
the
Income
Tax
Act
or
a
Regulation.
It
is
clear
that
the
range
of
documents
which
may
be
retained
under
s
231(2)
has
to
relate
to
the
violation
which,
on
reasonable
and
probable
grounds,
the
Minister
believes
has
been
committed.
In
this
case
the
alleged
violations
appear
to
be
confirmed
to
ss
239(1
)(c)
and
239(1
)(d)
of
the
Act.
There
is
no
suggestion
in
the
material
of
the
violation
of
any
provision
in
the
regulation.
Further,
the
paragraph
does
not
say
that
the
seized
documents
are
or
may
be
required
as
evidence
in
relation
to
the
violation
in
question.
I
merely
advert
to
these
matters
and
base
no
conclusion
on
them.
It
may
well
be
that
they
are
simply
matters
of
form
but
they
may,
with
respect,
also
be
symptomatic
of
a
general
lack
of
attention
to
the
actual
requirements
of
the
provision.
These
latter
comments
of
Morden,
JA
are
especially
significant
since
the
acts
complained
of
in
this
case
were
instituted
by
the
same
taxation
office
about
one
month
after
the
Usarco
decision
was
released.
Continuing
further
on
152
[6090],
His
Lordship
states:
.
.
.
The
affidavit
simply
does
not
attempt
to
identify
or
describe,
even
in
a
general
way,
what
documents
were
seized.
This
being
the
case,
there
was
nothing
in
the
affidavit
to
which
the
judge
could
direct
his
mind
on
the
important
question
of
whether
the
Minister
had
reasonable
and
probable
grounds
to
believe
that
the
seized
documents
were,
or
may
have
been,
required
as
evidence
in
relation
to
the
alleged
violations.
[Emphasis
added]
In
the
present
case,
not
only
did
the
judge
not
have
sufficient
evidence
before
him
to
be
satisfied
that
the
seized
documents
were
required
as
evidence
in
relation
to
the
alleged
violation,
we
now
know
that
the
documents
were
required
for
reasons
that
had
nothing
to
do
with
the
alleged
violation.
At
153
[6091],
His
Lordship
states:
Quite
apart
from
the
omissions
in
the
affidavit
to
which
I
have
referred
there
are
specific
statements
in
it
which
cast
real
doubt
on
whether
the
Minister
had,
or
more
directly,
believed
that
he
had,
at
the
time
of
the
application,
evidence
which
could
satisfy
the
requirement
of
s
231(2).
It
is
sufficient
if,
within
the
120
days
following
seizure,
the
evidence
before
the
judge
establishes
that
there
are
reasonable
and
probable
grounds
for
the
minister
to
believe
the
documents
“are
or
may
be
required
as
evidence’’.
While
the
continuance
of
the
investigation
after
the
120
days
is
not
in
itself
incompatible
with
s
231(2)
being
satisfied
(paragraph
10),
the
specific
statement
in
paragraph
11
“that
the
time
required
to
complete
the
investigation
will
extend
beyond
the
120
days
time
limit
set
forth
in
subsection
231(2)
of
the
Income
Tax
Act”
carries
the
strong
implication,
notwithstanding
the
very
general
statement
in
paragraph
12,
that
at
the
time
of
the
application
the
Minister
did
not
have
reasonable
and
probable
grounds
to
believe
that
the
seized
documents
were,
or
may
have
been
required
as
evidence.
He
was,
in
effect,
seeking
more
time
in
an
attempt
to
ascertain
if
the
relevant
grounds
existed.
[Emphasis
added]
Accordingly,
I
conclude
that
even
if
the
original
seizure
had
been
valid,
the
retention
order
cannot
stand.
The
application
for
the
retention
order
was
not
made
in
good
faith,
was
not
for
the
purpose
indicated
in
the
affidavit
in
support
of
the
application
and
there
was
not
proper
material
before
Judge
Warrender
to
justify
the
granting
of
the
retention
order.
There
will
accordingly
be
an
order
quashing
the
retention
order.
Should
the
Documents
and
Copies
be
Returned?
The
words
of
subsection
232(2)
are
mandatory.
They
require
that
the
Minister
shall
return
the
documents
within
120
days
unless
a
valid
retention
order
is
made.
Both
counsel
conceded
that
the
cases
establish
that
there
is
a
discretion
either
to
order
the
documents
returned
or
in
the
alternative,
notwithstanding
the
mandatory
language
of
the
section
to
allow
the
documents
to
be
retained.
It
was
argued
on
behalf
of
the
respondent
that
the
documents
should
not
be
returned
for
three
reasons:
(a)
The
delay
in
bringing
this
application;
(b)
The
pending
prosecution;
and
(c)
The
ruling
by
the
trial
judge
determining
the
admissibility
of
the
documents,
which
should
only
be
dealt
with
on
appeal
after
the
proceedings
had
been
completed.
I
will
deal
with
these
in
order.
Delay
Over
four
years
have
passed
since
the
seizure
and
the
retention
order.
However,
the
applicants
were
justified
in
believing
that
the
retention
of
the
documents
was
only
for
the
purpose
of
examining
into
the
failure
to
remit
and
they
were
justified
in
not
bringing
an
application
or
expending
moneys
on
a
pure
technicality
at
that
time.
The
applicants
have
been
aware
since
November
1981,
“that
the
documents
were
being
used
for
a
much
wider
investigation
than
that
which
I
(the
applicants’
solicitor)
was
led
to
believe”.
I
am
not
able
however
to
ascertain
from
the
material
before
me
whether
the
applicants
knew
that
the
intention
had
always
been
to
conduct
a
much
wider
investigation
and
that
the
original
seizure
and
application
for
retention
order
were
guise
for
a
“fishing
expedition”.
As
far
as
I
can
determine
from
the
material
before
me,
it
was
not
until
October
1984
that
they
knew
from
the
admission
of
Carolyn
Davis
that
she
had
at
all
times
intended
to
make
a
wide
investigation.
I
do
not
accept
the
other
grounds
set
out
in
the
affidavit
material
of
Brian
S
Nichols,
as
being
adequate
justification
for
the
delay.
However,
the
evidence
disclosed
on
October
30,
1984
indicates
sufficient
grounds
to
justify
the
applicants’
reassessing
the
situation
and
making
the
present
application.
This
they
did
within
one
week.
Delay,
therefore,
is
not
a
bar
to
the
relief
sought.
Pending
Proceedings
In
the
Usarco
case,
Morden,
JA
stated
at
154
[6093]:
.
.
.
The
subsection
is
intended
to
provide
for
the
return
of
seized
documents
in
cases
where
no
retention
order
is
obtained
within
120
days
of
the
seizure.
It
is
a
natural
and
logical
part
of
the
statutory
scheme.
However,
I
do
not
think
that
the
subsection
extends
to
ousting
the
discretion
of
a
court
to
refuse
to
order
the
Crown
to
return
evidence
to
an
accused
person
where
there
is
evidence
that
it
is
required
for
a
pending
prosecution.
A
refusal
to
exercise
such
a
discretion
has
been
recently
affirmed
by
this
Court:
Regina
v
Model
Power
(A
Division
of
Master
Miniatures
Ltd),
January
25,
1980.
While
such
a
discretion
is
one
which
should
be
exercised
with
great
care,
[Emphasis
added]
I
am
satisfied
that,
in
the
present
case,
it
is
the
better
course
to
refuse
to
order
the
return
of
the
documents.
As
I
have
just
indicated,
the
long
delay
of
the
applicant
is
a
factor
to
be
considered
on
this
issue.
While
the
documents
were
not
ordered
to
be
returned
in
the
Usarco
case,
I
am
ordering
that
the
documents
and
all
copies
be
returned
in
this
case.
The
Usarco
decision
appears
to
have
been
an
academic
triumph
for
the
applicants
but
the
result
was
that
the
Hamilton
Taxation
Division
had
the
benefit
of
the
documents
that
they
obtained
through
inappropriate
procedures.
The
present
case
is
somewhat
different.
The
respondents
have
admitted
that
from
the
outset
they
were
not
interested
in
the
failure
to
remit.
They
were
not
acting
in
good
faith.
Notwithstanding
the
Court’s
findings
in
the
Usarco
case,
they
continued
to
operate
in
the
same
manner.
The
Usarco
decision
left
them
with
the
fruits
of
their
improper
conduct.
The
documents
should
be
returned.
The
Department
cannot
take
away
private
rights
and
seize
private
property
except
in
strict
compliance
with
the
legislation.
They
must
comply
not
only
with
the
requirements
of
the
Act
but
with
the
spirit
as
well.
The
Pending
Proceedings
I
am
aware
that
this
decision
may
to
some
extent
influence
the
pending
proceedings.
Those
proceedings
however,
are
delayed
for
a
lengthy
period
pending
the
Court
of
Appeal’s
decision
with
regard
to
the
prohibition
application.
The
case
against
the
applicants
may
still
be
made
out
without
the
documents
or
copies
thereof.
In
the
alternative,
there
may
be,
in
the
course
of
the
trial,
submissions
made
to
the
trial
judge
with
regard
to
the
documents.
I
am
making
no
finding
whatsoever
as
to
their
admissibility.
It
would,
in
my
view,
not
be
appropriate
at
this
stage,
to
review
the
trial
judge’s
decision
in
that
regard.
The
trial
judge
stated,
with
regard
to
the
order
of
Judge
Warrender:
Frankly
I
do
not
believe
that
I
can
go
behind
that
order
.
.
.
Accordingly,
it
may
be
of
assistance
to
him
to
have
a
determination
of
the
issues
that
I
have
dealt
with.
The
Charter
The
Canadian
Charter
of
Rights
and
Freedoms
being
Part
I
of
the
Constitution
Act,
1982
amended
by
the
Constitution
Amendment
Proclamation,
1983
effective
June
21,
1984,
provides
as
follows:
8.
Everyone
has
the
right
to
be
secure
against
unreasonable
search
or
seizure.
In
my
view,
it
is
not
necessary
to
consider
the
Charter
in
this
case,
since
the
rights
that
were
infringed
and
are
sought
to
be
protected
have
existed
for
hundreds
of
years
at
common
law.
If
it
had
been
necessary
to
consider
the
matter,
I
would
have
decided
that
the
Charter
was
applicable.
Of
the
3,600
hours
of
investigation
carried
out
by
the
respondent,
a
major
portion
of
these
hours
are
after
the
Charter
came
into
force.
In
argument
before
me,
no
attack
was
made
on
the
validity
of
the
various
provisions
of
section
232,
in
light
of
the
Charter,
and
accordingly,
I
have
not
considered
the
matter.
In
the
course
of
argument
on
the
motion,
I
referred
counsel
to
the
case
of
Blackwoods
Beverages
Ltd,
Beverage
Services
Ltd,
and
Coca-Cola
Ltd
v
The
Queen
et
al,
a
decision
of
the
Court
of
Appeal
of
Manitoba
released
November
20,
1984.
I
asked
counsel
for
their
comments,
since
I
felt
that
this
decision
might
have
some
relevance
to
the
present
motion.
In
that
case,
the
documents
had
been
seized
pursuant
to
section
10
of
the
Combines
Investigations
Act,
RSC
1970,
Chap
C-23.
Section
10,
under
which
the
seizure
made
was
held
by
the
Supreme
Court
of
Canada
to
be
unconstitutional
by
virtue
of
the
Charter
in
the
Southam
v
Hunter
case,
84
DTC
6467,
confirming
(1983),
147
DLR
(3d)
420.
In
the
Blackwoods
case,
O’Sullivan,
J
A
said
at
p
2
of
his
reasons:
The
seizure
of
documents
in
this
case
was
perfectly
lawful,
in
my
opinion.
Sections
10(1)
and
10(3)
of
the
Combines
Investigation
Act
(RSC
1970,
chap
C-23)
did
not
become
unconstitutional
until
the
Charter
came
into
force.
The
seizure
occurred
before
that
date.
The
continued
detention
of
documents
seized
has
been
rendered
unlawful
by
reason
of
the
Charter
but
I
do
not
see
how
that
affects
copies,
notes
or
précis
made
while
the
seizure
and
detention
were
lawful.
In
that
case
a
prosecution
was
in
process
and
the
court
refused
to
interfere
with
rulings
made
in
the
course
of
the
trial,
refusing
even
to
consider
the
matter.
The
court
ordered
the
documents
seized
returned.
They
refused
to
order
the
return
of
the
copies
and
précis
because
they
were
made
at
a
time
when
the
seizure
and
detention
were
lawful.
Matas,
JA
states
at
14:
The
order
to
return
the
documents
in
Southam,
supra,
Was
not
overruled
by
the
Supreme
Court
of
Canada.
Examples
of
cases
where
similar
orders
were
made
are
found
in
Re
Chapman
and
The
Queen
(1984),
12
CCC
(3d)
1
(Ont
CA)
and
in
R
v
Taylor
(1983),
25
Sask
R
145
(Sask
QB).
Here,
the
order
goes
one
step
further
in
ordering
the
return
of
copies
of
the
documents
and
any
notes,
précis
or
other
descriptions
of
the
documents.
The
extension
is
appropriate
if
the
order
for
return
is
not
to
be
illusory
as
far
as
protecting
the
rights
of
a
claimant
are
concerned.
In
the
case
at
bar
the
Court
of
Queen’s
Bench
had
jurisdiction
to
consider
and
decide
the
constitutionality
of
secs
10(1)
and
(3)
of
the
Act.
In
view
of
the
appellants’
acknowledgment
that
they
would
not
proceed
without
the
documents
the
court
was
in
a
position
to
consider
and
decide
the
result
which
could
flow
from
its
determination
of
the
constitutional
issue.
A
potentially
protracted
and
costly
proceeding
would
be
brought
to
an
end
on
the
exercise
of
the
court’s
jurisdiction
at
this
stage
before
the
preliminary
hearing
has
started.
I
consider
the
following
additional
factors
to
have
significance.
The
seized
documents
are
the
property
of
the
companies
and
do
not
fall
within
the
rubric
of
illegal
substances,
or
stolen
goods
or
goods
liable
to
customs
or
excise
duties
(Manning,
Rights,
Freedoms
and
the
Courts,
p
278).
The
companies
do
not
rely
on
circumstances
other
than
those
before
the
Court
of
Queen’s
Bench
to
support
their
case;
it
is
not
the
conduct
of
the
appellants
to
which
attention
has
to
be
directed
but
the
legislation
under
which
they
acted
(Southam,
supra).
And
the
Charter
has
revitalized
and
entrenched
protective
common
law
rights
and
earlier
statutory
provisions
which
had
been
derogated
by
the
Act.
In
my
opinion,
this
is
an
appropriate
case
for
the
court,
under
the
authority
of
either
s
24(1)
of
the
Charter
or
the
inherent
jurisdiction
of
the
court,
to
have
exercised
its
jurisdiction
to
make
a
constitutional
declaration
and
follow
that
up
with
the
necessary
orders
to
halt
the
proceedings.
Retrospectivity:
Since
the
proclamation
of
the
Charter
a
consistent
line
of
authority
has
held
that
the
substantive
rights
conferred
by
the
Charter
do
not
have
retrospective
or
retroactive
effect.
For
example:
R
v
Belton,
[1983]
2
WWR
472,
31
CR
(3d)
223
(Man
CA),
R
v
Lee
(1982),
17
MVR
173,
30
CR
(3d)
395,
142
DLR
(3d)
574
(Sask
CA),
Stuart
v
Attorney
General
of
Canada
(1982),
44
NR
320
(FCA).
The
statement
of
Hoyt
J
in
R
v
Davidson
(1982),
29
CR
(3d)
241,
at
pp
245-246
is
apposite
to
the
point
before
us:
.
.
.
While
the
infringement
of
the
accused’s
right
against
unreasonable
search
or
seizure,
which
must
certainly
occur
when
a
search
of
a
residence
is
made
under
a
defective
search
warrant,
occurs
at
the
time
of
the
act,
in
this
case
10th
March
1982,
and
while
it
is
a
very
real
infringement
on
that
day,
the
infringement
continues,
in
my
view,
until
the
things
seized
are
returned
to
him.
The
taint
continues
on
the
things
seized
and
is
converted
from
an
almost
abstract
infringement
as
of
the
date
of
seizure
to
a
very
real
or
practical
infringement
when
the
tainted
articles
are
offered
in
evidence.
While
established
rules
of
statutory
construction
must
be
applied
to
construing
the
application
of
the
Charter,
I
cannot
think
that
artificial
or
tedious
reasoning
should
be
applied
to
thwart
the
remedial
character
of
the
Charter.
To
isolate
the
search
and
seizure
of
the
articles
from
their
tendering
as
evidence
would
be
just
that.
.
.”
In
Chapman,
supra,
MacKinnon
ACJO
(Dubin
and
Tarnopolsky
JJ
A
concurring),
the
court
considered
the
jurisdiction
to
return
objects
seized
under
a
search
warrant
which
had
been
quashed.
The
learned
trial
judge
had
ordered
the
return
of
the
articles.
The
Crown
agreed
that
the
quashing
of
the
search
warrant
was
proper
but
argued
in
the
Court
of
Appeal
that
there
was
no
discretion
to
order
the
return
of
any
articles
which
the
Crown
alleged
would
be
required
as
evidence
in
a
criminal
proceeding.
MacKinnon
ACJO
said
at
pp
8-9:
“It
is
true,
in
the
instant
case,
that
the
article
in
issue
was
seized
prior
to
the
enactment
of
the
Charter.
However,
as
the
Crown
seeks
to
use
it
now
as
evidence,
the
invocation
of
ss
8
and
24,
in
light
of
all
the
circumstances,
is
not
to
give
the
Charter
or
the
sections
retrospective
effect.
To
consider,
in
relation
to
s
24,
the
circumstances
surrounding
the
execution
of
the
search
warrant,
and
the
subsequent
condemned
activities
cited
by
the
motions
court
judge
which
took
place
after
the
enactment
of
the
Charter,
is
not,
in
my
view,
to
give
retrospective
effect
to
the
Charter.”
In
R
v
Burnett
et
al
(judgment
delivered
Oct
1,
1984,
Ont
SC
TD),
Hartt
J
considered
the
Crown’s
submission
on
whether
s
13
of
the
Charter
applies
to
retrospectivity
in
proceedings
conducted
prior
to
the
proclamation
of
the
Charter,
ie,
to
affidavits
sworn
prior
to
April
19,
1982.
The
learned
trial
judge
said
at
p
24:
“.
.
.
In
my
view
retrospectivity
is
not
in
issue
in
this
case.
The
protection
afforded
by
section
13
is
directed
to
the
use
of
the
evidence
to
incriminate
the
witness
in
the
subsequent
proceedings.
The
defendant,
Burnett,
seeks
to
exercise
his
right
now,
in
this
trial,
when
the
Charter
is
clearly
in
force.
The
fact
that
the
evidence
was
given
in
proceedings
held
before
the
enactment
of
the
Charter
in
no
way
prevents
him
from
asserting
the
protection
of
section
13
at
this
time.
In
my
view,
Mr
Burnett
is
clearly
entitled
to
attempt
to
invoke
section
13
of
the
Charter.”
To
the
same
effect
is
Donald
v
Law
Society
of
British
Columbia,
[1984]
WCD
023
(BCCA).
In
the
case
at
bar,
the
documents
were
seized
between
1977
and
1981.
Proceedings
were
not
begun
against
the
companies
until
1983,
and
the
preliminary
hearing
has
not
been
started.
(As
in
Southam,
supra,
the
authorization
to
search
preceded
the
Charter.)
It
is
the
retention
of
the
documents
by
the
appellants
and
the
use
of
the
documents,
although
post
Charter,
which
are
important
factors
in
this
case.
Principles
expressed
in
the
cases
cited
above
and
others
referred
to
by
the
appellants,
such
as
The
Queen
v
Longtin
(1983),
41
OR
(2d)
545,
5
CCC
(3d)
12,
147
DLR
(3d)
604,
are
not
applicable
here.
It
would
not
be
giving
retrospective
effect
to
s
8
of
the
Charter
to
provide
a
remedy
to
the
companies
for
the
continued
infringement
of
their
rights
under
the
Charter.
The
cases
cited
by
Matas,
JA,
in
my
view,
reinforce
the
decision
that
I
have
reached,
that
all
of
the
documents
and
all
copies
and
précis
of
the
documents
should
be
returned
to
the
applicants.
Accordingly,
there
will
be
a
declaration
that
the
seizure
of
the
documents
by
Revenue
Canada
on
November
4,
1979
and
December
20,
1979
were
illegal
and
without
statutory
authorization.
There
will
be
an
order
quashing
the
retention
order
issued
by
Judge
Warrender
on
the
28th
day
of
March,
1980.
There
will
be
an
order
that
the
documents
seized
and
all
copies
and
precis
thereof
be
immediately
returned
to
the
applicants.
Costs
The
applicants
have
asked
for
costs
on
a
solicitor
and
client
basis
in
view
of
the
violations
of
their
rights.
They
have
also
asked
that
the
costs
be
payable
to
the
solicitors
for
the
applicants
without
set-off
of
any
claims
that
may
be
made
against
the
applicants
or
any
of
them
by
the
respondent.
While
I
have
expressed
strong
views
with
regard
to
the
conduct
of
the
respondents,
I
do
not
feel
that
their
behaviour
justifies
solicitor
and
client
costs
being
awarded
against
them.
The
applicant
shall
have
their
costs
of
these
proceedings
on
a
party
and
party
basis.
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