MacDonald,
C.J.T.D.:—The
Crown
appeals
an
order
staying
proceedings
in
relation
to
a
charge
contrary
to
paragraph
239(1)(d)
of
the
Income
Tax
Act,
R.S.C.
1952,
Ch.
148,
to
which
the
accused
pled
guilty.
The
charge
relates
to
the
failure
of
the
accused
to
declare
his
full
income
for
taxation
purposes.
The
amount
of
income
that
he
failed
to
declare
was
$47,102.22.
The
accused,
while
pleading
guilty
to
the
charge,
contested
the
applicability
of
the
penalty
provisions
of
paragraph
239(1)(d)
on
the
basis
that
he
had
already
been
penalized
by
the
Minister
under
subsection
163(2)
of
the
Income
Tax
Act.
Prior
to
the
laying
of
the
information
under
paragraph
239(1)(d),
the
Minister
had
made
a
reassessment
including
penalties
for
false
statements
made
by
the
accused
which
was
levied
pursuant
to
subsection
163(2)
of
the
Act.
I
would
have
thought
that
the
accused,
having
pled
guilty
to
the
charge
under
paragraph
239(1)(d),
would
be
precluded
from
arguing
that
the
penalty
provision
does
not
apply.
However,
counsel
did
not
deal
with
that
issue.
In
ordering
a
stay,
the
trial
court
judge
accepted
the
submission
of
the
accused
that
subsection
163(2)
of
the
Iqcome
Tax
Act
created
an
offence
within
the
meaning
of
paragraph
11(h)
of
the
Canadian
Charter
of
Rights
and
Freedoms,
and
consequently
paragraph
11(h)
had
been
violated.
The
reason
given
for
coming
to
that
conclusion
was
that
the
accused,
if
punished
or
penalized
under
paragraph
239(1)(d),
in
addition
to
the
penalty
assessed
under
section
163,
would
be
penalized
twice.
The
accused
is
faced
with
two
decisions
of
courts
of
appeal.
In
R.
v.
Yes
Holdings
Ltd.
(1987),
37
C.C.C.
(3d)
30,
(leave
to
appeal
to
Supreme
Court
of
Canada
denied),
the
Alberta
Court
of
Appeal,
in
a
decision
by
Stevenson,
J.A.,
concurred
in
by
Irving,
J.A.,
rejected
the
argument
that
paragraph
11(h)
was
applicable
in
this
type
of
instance.
Stevenson,
J.A.
concluded
that
proceedings
under
subsection
163(2)
of
the
Income
Tax
Act
should
not
be
characterized
as
an
offence
and
therefore
there
was
no
contravention
of
section
11.
In
R.
v.
George's
Contracting
Ltd.
and
Cloarec
(1988),
41
C.C.C.
(3d)
95,
the
British
Columbia
Court
of
Appeal
also
dealt
with
the
same
sections
of
the
Income
Tax
Act
and
came
to
the
same
conclusion,
that
is,
there
was
no
violation
of
paragraph
11(h)
of
the
Charter.
In
addition
to
these
two
cases
is
the
decision
of
the
Supreme
Court
of
Canada
in
R.
v.
Wigglesworth,
[1987]
2
S.C.R.
541;
45
D.L.R.
(4th)
235;
37
C.C.C.
(3d)
385.
The
accused
relies
on
the
latter
case
despite
the
fact
that
in
the
R.
v.
George's
case,
supra,
the
Court
found
that
Wigglesworth
provided
no
comfort
whatever
to
the
accused
in
that
case.
As
regards
the
R.
v.
Yes
case,
supra,
it
was
decided
eight
days
after
R.
v.
Wigglesworth,
supra,
but
no
mention
was
made
of
Wigglesworth
in
that
case.
In
Wigglesworth,
Wilson,
J.
at
page
397
(D.L.R.
247),
concluded
that
the
rights
guaranteed
by
section
11
of
the
Charter''.
.
.are
available
to
persons
prosecuted
by
the
state
for
public
offences
involving
punitive
sanctions,
i.e.,
criminal,
quasi-criminal
and
regulatory
offences,
either
federally
or
provincially
enacted".
At
page
399
(D.L.R.
250),
she
stated
that
the
words
"
charged
with
an
offence"
restricts
the
application
of
the
section
to
criminal
and
quasi-criminal
proceedings
and
proceedings
giving
rise
to
penal
consequences.
In
determining
whether
a
particular
proceeding
falls
within
the
ambit
of
section
11,
the
accused
placed
great
reliance
upon
the
following
words
of
Wilson,
J.
at
page
401
(D.L.R.
251-52):
In
my
view,
if
a
particular
matter
is
of
a
public
nature,
intended
to
promote
public
order
and
welfare
within
a
public
sphere
of
activity,
then
that
matter
is
a
kind
of
matter
which
falls
within
s.
11.
It
falls
within
the
section
because
of
the
kind
of
matter
it
is.
This
is
to
be
distinguished
from
private,
domestic
or
disciplinary
matters,
which
are
regulatory,
protective
or
corrective
and
which
are
primarily
intended
to
maintain
discipline,
professional
integrity
and
professional
standards
or
to
regulate
conduct
within
a
limited
private
sphere
of
activity:
There
is
also
a
fundamental
distinction
between
proceedings
undertaken
to
promote
public
order
and
welfare
within
a
public
sphere
of
activity
and
proceedings
undertaken
to
determine
fitness
to
obtain
or
maintain
a
license.
Where
disqualifications
are
imposed
as
part
of
a
scheme
for
regulating
an
activity
in
order
to
protect
the
public,
disqualification
proceedings
are
not
the
sort
of
"offence"
proceedings
to
which
s.
11
is
applicable.
While
Wilson,
J.
pointed
out
instances
that
would
or
would
not
fall
within
section
11,
a
further
comment
that
she
made
is
important.
Proceedings
of
an
administrative
nature
instituted
for
the
protection
of
the
A
public
in
accordance
with
the
policy
of
a
statute
are
also
not
the
sort
of
"offence"
proceedings
to
which
s.
11
isapplicable.
I
believe
that
proceedings
under
section
163
are
of
an
administrative
nature.
I
do
not
see
them
as
being
criminal
or
quasi-criminal.
No
charge
is
laid
under
subsection
163(2),
no
trial
is
carried
out
and
no
sentence
is
pronounced.
Following
one
of
the
two
tests
pronounced
by
Wilson,
J.,
the“
by
nature
test”
it
cannot
be
said
that
the
proceedings
are
criminal
or
quasi-criminal.
The
trial
judge
also
placed
strong
reliance
upon
the
second
test
formulated
by
Wilson,
J.,
what
she
called
the
“true
personal
consequence
test".
In
her
opinion
a
true
penal
consequence
which
would
bring
section
11
into
play
would
consist
of
imprisonment
or
a
fine
"which
by
its
magnitude
would
appear
to
be
imposed
for
the
purpose
of
redressing
the
wrong
done
to
society
at
large
rather
than
to
the
maintenance
of
internal
discipline
within
the
limited
sphere
of
activity”,
(page
402
(D.L.R.
252)).
The
accused
submits
that
the
amount
of
the
penalty
which
he
is
liable
for
under
section
163
falls
within
the
ambit
of
the
dictum
of
Wilson,
J.
The
magnitude
of
the
penalty
in
this
instance
would
not,
in
my
opinion,
be
one
that
would
attract
the
provisions
of
section
11
considering
the
amount
of
tax
that
was
not
reported.
A
further
submission
arises
from
the
statement
of
Wilson,
J.
that
one
indicium
of
the
purpose
of
a
particular
fine
is
how
the
body
is
to
dispose
of
the
fines
it
collects.
She
felt
that
if
the
fines
are
to
form
part
of
the
Consolidated
Revenue
Fund
that
would
indicate
they
are
not
for
the
purpose
of
a
private
or
internal
matter.
It
was
admitted
that
the
penalty
imposed
here
goes
to
the
Consolidated
Revenue
Fund.
It
must
be
recognized
that
Wilson,
J.
was
attempting
to
differentiate
between
matters
of
a
public
nature
and
matters
of
a
private,
domestic
or
disciplinary
nature.
I
do
not
see
that
reason
as
being
particularly
applicable
here.
If
I
have
correctly
classified
section
163
as
being
of
an
administrative
nature,
the
test
of
where
the
fine
or
penalty
goes
is
of
no
relevance
as
those
fines
or
penalties
would
undoubtedly
go
to
the
Consolidated
Revenue
Fund.
I
would
hold
that
proceedings
under
subsection
163(2)
fail
both
the
tests
enunciated
by
Wilson,
J.
They
are
neither
the
type
of
proceedings
that
fall
within
section
11
nor
can
they
be
the
type
of
proceeding
that
could
be
termed
a
true
penal
consequence.
A
further
ground
of
appeal
is
that
the
trial
judge
erred
in
finding
that
subsection
163(2)
and
paragraph
239(1)(d)
of
the
Income
Tax
Act
create
the
same
offence.
While
the
trial
judge
did
not
explicitly
make
such
a
finding
I
believe
it
can
be
inferred
that
he
did
so.
The
accused
argues
that
if
he
were
punished
under
paragraph
239(1)(d)
he
would
be
placed
in
double
jeopardy.
He
states
that
there
is
an
identity
of
offences
rendering
paragraph
11(h)
applicable.
I
have
already
held
that
subsection
163(2)
does
not
create
an
offence.
However,
if
it
does
create
an
offence,
merely
because
there
may
be
a
single
act,
does
not
mean
that
a
person
cannot
be
charged
with
two
offences.
If
there
are
distinct
elements
to
the
offences,
the
charges
are
sustainable:
R.
v.
Prince,
[1986]
2
S.C.R.
480;
33
D.L.R.
(4th)
724;
30
C.C.C.
(3d)
35.
In
Wigglesworth,
supra,
Wilson,
J.
found
that
there
were
two
offences,
one
being
the
internal
disciplinary
matter
and
the
second
the
criminal
offence
of
assault
but
she
held
that
Wigglesworth
was
not
being
punished
for
the
same
offence.
The
matter
under
subsection
163(2)
involves
a
breach
of
the
taxpayer's
obligations
to
fulfil
his
financial
responsibilities
to
the
government.
This
obligation
may
be
enforced
by
civil
remedies.
Further,
the
taxpayer
may
request
a
reassessment.
The
charge
under
section
239
is
the
criminal
offence.
The
matter
under
subsection
163(2)
has
to
do
with
the
administrative
nature
of
the
Income
Tax
Act.
A
subsequent
case
from
the
Supreme
Court,
R.
v.
Shubley,
[1990]
1
S.C.R.
3;
52
C.C.C.
(3d)
481,
further
explains
the
decision
in
Wigglesworth.
In
Shubley,
an
inmate
in
a
prison
assaulted
another
inmate.
Prison
authorities
held
a
hearing
under
the
Ministry
of
Correctional
Services
Act,
R.S.O.
1980,
c.
275
and
had
him
placed
in
solitary
confinement
for
five
days.
Later
the
victim
laid
an
assault
charge
contrary
to
paragraph
245.1(1)(b)
of
the
Criminal
Code,
R.S.C.
1970,
c.
C-34.
The
majority
of
the
Supreme
Court,
in
a
decision
written
by
McLachlin,
J.,
stated
at
page
18
that".
.
.the
question
of
whether
proceedings
are
criminal
in
nature
is
concerned
not
with
the
nature
of
that
Act
which
gives
rise
to
the
proceedings,
but
the
nature
of
the
proceedings
themselves".
The
Supreme
Court
concluded
that
the
disciplinary
proceedings
were
not
criminal
as
all
the
inmate
was
being
held
to
account
for
was
his
breach
of
conduct
of
prison
rules.
Where
in
Shubley
the
proceedings
were
found
to
be
disciplinary
and
not
criminal,
in
the
present
case,
I
find
the
proceedings
under
section
163
to
be
administrative
and
not
criminal.
As
to
the
“true
penal
consequences”
test,
McLachlin,
J.
concluded
that
there
was
no
imprisonment
rather
it
was
closed
confinement.
She
reiterated
the
conclusion
of
Wilson,
J.
that
a
fine
which,
by
its
magnitude
would
appear
to
be
imposed
for
the
purpose
of
reducing
the
wrong
done
to
society,
would
attract
section
11.
I
do
not
find
anything
in
Shubley,
supra,
that
would
assist
the
respondent.
The
penalty
imposed
under
section
163
is,
in
my
opinion,
imposed
to
compensate
the
Minister
for
the
cost
of
the
investigation
into
the
financial
affairs
of
the
person
being
investigated.
It
also
allows
the
Minister
to
recoup
some
of
the
lost
taxation
income.
An
indication
that
it
is
an
administrative
matter
flows
from
the
fact
that
the
assessment
of
the
penalty
is
not
made
public
whereas
if
it
were
of
a
criminal
nature
it
would
be
made
public.
It
should
also
be
noted
that
Wilson,
J.
in
Wigglesworth,
supra,
at
page
402
(D.L.R.
252)
commented
that
if
a
body
has
unlimited
power
to
fine,
and
if
it
does
not
afford
the
rights
set
forth
in
section
11,
it
cannot
impose
fines
designed
to
redress
the
harm
to
society
at
large.
Instead,
she
states,
the
body
is
restricted
to
the
power
to
impose
fines
in
order
to
achieve
the
particular
private
purpose.
Can
it
be
said
that
the
Minister
has
unlimited
power
to
fine?
The
answer
is
no
as
the
Minister
is
restricted
to
the
amount
set
forth
in
subsection
163(2)
of
the
Income
Tax
Act.
A
word
must
also
be
said
regarding
the
procedure
to
be
followed
under
section
239.
Subsection
239(3)
reads
as
follows:
(3)
Penalty
upon
conviction.
Where
a
person
has
been
convicted
under
this
section
of
wilfully,
in
any
manner,
evading
or
attempting
to
evade
payment
of
taxes
imposed
by
Part
I,
he
is
not
liable
to
pay
a
penalty
imposed
under
section
163
for
the
same
evasion
or
attempt
unless
he
was
assessed
for
that
penalty
before
the
information
or
complaint
giving
rise
to
the
conviction
was
laid
or
made.
Under
this
subsection
a
person
convicted
under
section
239
is
not
liable
to
pay
a
penalty
assessed
under
section
163,
unless
he
was
assessed
the
penalty
before
the
information
was
laid.
In
the
present
instance
the
penalty
was
assessed
prior
to
the
information
being
laid.
The
purpose
of
subsection
239(3)
would
appear
to
allow
the
Court
hearing
the
subsection
239(3)
charge
to
know
what
penalty
may
have
been
assessed
by
the
Minister.
It
is
obvious
that
there
is
a
close
interconnection
between
section
163
and
section
239
and
one
that
was
expressly
recognized
by
Parliament.
If
a
certain
thing
occurs,
the
other
section
does
not
apply.
They
are
interrelated
in
purpose.
Obviously,
if
the
penalty
has
been
assessed
first,
the
Court
hearing
the
section
239
offence
should
take
into
consideration
that
penalty.
It
is
not
a
case
of
having
something
in
one
hand
not
knowing
what
is
in
the
other
hand.
Finally,
in
Shubley,
supra,
the
Court
re-emphasized
the
conclusion
of
Wigglesworth,
supra,
that
a
narrow
interpretation
must
be
given
to
paragraph
11(h)
of
the
Charter.
Section
7
of
the
Charter
Counsel
did
not
address
me
orally
on
this
aspect
at
the
trial
but
both
have
filed
briefs
dealing
with
section
7
of
the
Charter
and
wish
to
rely
on
their
briefs.
the
respondent's
principal
argument
is
that
paragraph
239(1)(d)
offends
section
7
as
it
is
punishment
for
the
same
delict
and
offends
the
principles
of
fundamental
justice.
I
am
unable
to
agree
with
the
respondent.
As
I
have
already
stated,
there
were,
in
fact,,
two
delicts;
the
first
being
the
administrative
wrong
under
section
163
and
the
second
being
the
criminal
wrong
under
section
239.
In
R.
v.
Whittle
(1978),
79
D.T.C.
5011
(Ont.
S.C.),
Mackoff,
J.
at
5012
stated:
The
second
ground
advanced
to
me
is
that
the
gentleman
involved
in
this
case
had
been
assessed
by
the
Minister
under
Section
163(2)
of
the
Income
Tax
Act
and
in
so
being
assessed,
he
was
obliged
or
ordered
to
pay
in
addition
to
what
he
should
have
paid,
a
penalty
of
25%
of
the
amount
by
which
he
had
underdeclared.
Counsel,
therefore,
says
this
being
a
prosecution
under
Section
239(1),
it
is
therefore
an
abuse
of
process
contrary
to
the
rule
laid
down
in
Kienapple
v.
The
Queen
and
is
in
fact
double
jeopardy.
The
basis
upon
which
this
argument
is
founded
is
that
the
Minister,
in
his
determination
under
163(2)
of
the
Act,
was
acting
as
a
Court.
I
am
unable
to
accede
to
this
argument.
The
Minister
was
acting
in
an
administrative
capacity.
He
was
not
acting
in
a
judicial
capacity
and
I
accept
and
adopt
the
language
used
by
the
learned
Exchequer
Court
Judge
in
the
case
of
Minister
of
National
Revenue
v.
Appleby,
64
D.T.C.
5199.
In
addition,
speaking
of
a
Kienapple
approach,
it
might
further
be
pointed
out
that
the
assessment
levied
under
Section
163(2)
is
purely
civil
in
nature.
The
prosecution
sought
to
be
proceeded
with
under
239
is
of
a
criminal
nature
and
I
am
not
aware
of
any
law
that
precludes
the
Crown
under
the
Income
Tax
Act
from
pursuing
both.
Further,
in
Re
Ferreira,
Ont.
C.A.,
181/68,
1988,
(as
yet
unreported),
the
Court
allowed
an
appeal
in
which
section
163
and
section
239
were
before
the
Court.
The
Court,
without
reasons,
stated
that
section
7
had
no
application
to
the
circumstances.
Under
paragraph
163(2)
there
is
no
threat
to
life,
liberty
or
security
of
the
person.
Only
a
monetary
penalty
may
be
assessed.
In
Whitbread
v.
Walley
(1988),
51
D.L.R.
(4th)
509;
[1988]
5
W.W.R.
313,
the
British
Columbia
Court
of
Appeal,
McLachlin,
J.
giving
the
opinion
of
the
Court,
stated
at
pages
323-24
(D.L.R.
519-20):
To
date
s.
7
has
been
applied
mainly
in
cases
where
the
physical
liberty
of
the
complainant
has
been
infringed
or
is
in
danger
of
infringement.
Imprisonment
and
detention
by
the
state
offers
classic
examples
of
situations
where
s.
7
clearly
applies:
.
.
.
At
the
other
end
of
the
scale,
it
appears
clearly
that
purely
economic
claims
are
not
within
the
purview
of
s.
7
of
the
Charter.
No
one
suggests,
for
example,
that
imposition
of
a
monetary
disability
on
a
corporation
would
infringe
s.
7
if
not
effected
in
accordance
with
the
principles
of
fundamental
justice.
McLachlin,
J.
went
on
to
examine
the
instance
where
the
matter
complained
of
involves
an
economic
aspect
but
is
connected
to
or
affects
life,
liberty
or
security
of
the
person.
She
stated
that
there
were
two
related
grounds
put
forth
for
the
proposition
that
there
can
be
a
connection
between
the
limitation
of
liability
and
the
liberty
and
security
of
the
person
which
would
bring
section
7
into
play.
The
first
she
summarized
as
being
a
claim
for
an
economic
interest
which
is
founded
on
a
deprivation
of
life,
liberty
or
security
of
the
person.
In
the
present
case,
the
claim
of
an
economic
loss,
resulting
from
the
assessment
of
the
penalty
cannot
be
said
to
arise
from
the
deprivation
of
life,
liberty
or
security
of
the
person.
McLachlin,
J.
summarized
the
second
argument
as
being
a
claim
for
an
economic
interest
which
may
enhance
a
person's
ability
to
acquire
aids
and
amenities
to
improve
the
person's
life
or
security
of
the
person.
Again
the
respondent
would
not
meet
such
a
test.
McLachlin,
J.
points
out
the
difficulties
of
tying
economic
interests
to
section
7.
All
property
and
economic
interest
will
affect
the
life,
liberty
and
security
of
a
person.
She
concludes
that
it
was
not
the
intent
of
the
framers
of
the
Charter
to
give
section
7
that
meaning.
Based
on
another
rationalization
that
she
put
forth,
it
can
be
said
that
any
deprivation
of
life,
liberty
or
security
of
the
person,
which
the
respondent
may
have
suffered,
or
will,
is
not
caused
by
section
163
but
by
the
fact
that
he
made
a
false
statement
in
his
tax
return
[or]
wilfully
omitted
information
in
his
tax
return.
I
can
see
no
infringement
of
section
7.
The
appeal
is
allowed
and
the
stay
set
aside.
My
next
step
is
certainly
not
clear.
The
Crown
asks
that
I
impose
sentence
or
the
matter
be
referred
back
to
the
trial
judge.
The
respondent
has
not
spoken
to
the
issue.
Because
of
the
unusual
procedure
used
before
the
trial
judge,
the
accused
having
entered
a
plea
of
guilty
and
then
asking
for
a
stay,
I
can
only
classify
this
appeal
as
an
appeal
from
sentence.
However,
counsel
have
not
addressed
the
issue
of
who
should
impose
sentence
and
I
believe
it
would
be
advisable
to
have
them
appear
before
me
on
this
particular
matter.
Appeal
allowed.
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