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Citation: 2004TCC254
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Date: 20040331
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Docket: 2003-1665(EI)
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2003-1667(EI)
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BETWEEN:
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NIRMAL S. CHAUHAN,
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Appellant,
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and
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THE MINISTER OF NATIONAL REVENUE,
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Respondent,
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Docket: 2003-1666(EI)
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AND BETWEEN:
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SURINDER K. CHAUHAN,
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Appellant,
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and
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THE MINISTER OF NATIONAL REVENUE,
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Respondent.
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REASONS FOR JUDGMENT
McArthur J.
[1] The appeals of Surinder K.
Chauhan (2003-1666(EI)) and Nirmal S. Chauhan
(2003-1667(EI)) were heard on common evidence. They concern
the disallowance by the Minister of National Revenue of
employment insurance with respect to:
(a) Nirmal's claimed
employment with his brother, Mohinder, from May 1 to August
31, 2001;
(b) Surinder's claimed employment
with her brother-in-law, Mohinder, from May 1 to August 31,
2001.
[2] The appeal of Nirmal S. Chauhan
(2003-1665(EI)) concerns Nirmal's claimed employment with
his brother Pritam from February 18 to February 24, 2001, which I
will deal with separately.
[3] Nirmal and Surinder are husband
and wife and were the only witnesses.
[4] With the exception of Nirmal's
one-week period in February 2001, Court file (2003-1665(EI)), the
Notices of Appeal and Replies are almost identical except
Surinder's Reply contains assumption 6(m) "of four
cheques issued to the Appellant by Mohinder, only one was
deposited to the Appellant's own bank account". I do not
think this is accurate. She did not have a bank account and her
cheques were deposited to Nirmal's account. In any event,
this establishes nothing.
[5] A Punjabi interpreter was provided
for both Appellants and Mr. Bolla, an accountant and friend,
assisted them. Mr. Bolla did not prepare any of the documents
submitted in evidence, which included:
(a) Nirmal's 2001 Income Tax
Return;
(b) Cancelled cheques to Surinder from
Chauhan Orchard (Mohinder) totalling $3,600;
(c) Payslips for Surinder from
Mohinder;
(d) Handwritten time sheets that are
of dubious value. The author of these remains a mystery;
(e) Canadian Imperial Bank of
Commerce (CIBC) and Credit Union deposit slips, and
statements.
The Minister's counsel chose not to analyze these in any
detail.
[6] The Appellants are in their late
50s and they came to Canada in 1996. Since 1998, they have owned
and operated a six-acre fruit orchard in Keremeos, British
Columbia. It now consists of 600 cherry trees, 20 peach trees and
8 prune trees. The cherry trees were planted in 2000 and 2001
replacing unprofitable old apple trees and did not bear fruit
during the relevant period.
[7] When they were not tending to
their own orchard, they worked for Mohinder (Nirmal's
brother) who in 2001 operated two 10-acre and one 12-acre
orchard. He has been established in Canada for many years.
[8] During a site visit by the
Agriculture Compliance Team ("ACT") on July 5,
2001, Mohinder advised that he had no family members, other than
Satwant, working for him (so far that year). During a follow-up
site visit on July 31, 2001, Mohinder advised ACT members
that the Appellant and his wife were just helping out that day.
On October 11, 2001, both Appellants received identical records
of employment from Mohinder alleging 751 insurable hours of
employment and $6,759 insurable earnings during the period.
Nirmal alleges they were paid $9 per hour during the period but
was allegedly paid $10 per hour from Mohinder during the 2000
farming season. The Appellants worked when they were free. The
Appellants were also working on their own farm during the
period.
[9] ACT who apparently investigated
the situation included Brian Lundgren who was present in Court
but did not give evidence. In paragraph 6(h), the Minister states
that ACT visited Mohinder on July 5, 2001 who advised, in effect,
that the Appellants had not worked for him so far in 2001.
According to the Appellants' time sheets, they each worked
for Mohinder 270 hours in May and 108 hours in June.
[10] There is a payslip for the period
ending May 31, 2001 but no cheque. The cheques presented by the
Appellants reflect that Surinder was paid $1,288.46 on
August 14, 2001, $1,452.05 on September 13, 2001 and $856 on
July 13, 2001. This does not coincide with further evidence. The
bank deposit slips and statements are difficult to follow but
Exhibit A-2 appears to be the deposit of June paycheques for
both Appellants each in the amount of $856, the date of the
deposit is illegible. A CIBC bank statement indicates a deposit
of $3,762.10 on June 25 to Nirmal's account. This apparently
represents cheques from Mohinder to the Appellants each in the
amount of $1,881.05 which matches payslips for the period ending
May 31, 2001. I find this is sufficient evidence to refute
the assumption of fact in paragraph 6(h). No one testified for
the Respondent. Both Appellants admitted they were not working on
July 5, 2001 when ACT attended. In paragraph 6(i) the Minister
states that in a follow-up visit on July 31, 2001, Mohinder told
team members of ACT that the Appellants were just helping out as
stated. No one from ACT testified nor did Mohinder, the payor.
Nirmal stated that they were there to work. I accept his
statement. Neither Appellant was very articulate and often did
not understand questions put to them or the issues involved.
Mohinder came to Canada in 1975 and is 12 years younger than
Nirmal. It is unfortunate he did not testify.
[11] The Appellant, Nirmal agrees with
assumptions of fact (j), (k), (l), (n), (o), (p), (q) and not
(r).
(j) On October
11, 2001, the Appellant received a record of employment from
Mohinder alleging 751 insurable hours of employment and $6,759
insurable earnings during the Period;
(k) the Appellant
and his wife's record of employment issued by Mohinder shows
identical hours;
(l) the
Appellant alleges he was paid $9.00 per hour during the Period
but was allegedly paid $10.00 per hour from Mohinder during the
2000 farming season;
(m) the Appellant was not
supervised;
(n) the Appellant
worked when he wanted to;
(o) the Appellant
and his wife also obtained records of employments from the
Appellant's brother-in-law showing identical hours;
(p) the Appellant
was working on his own farm during the Period;
(q) the Appellant
helped out only when he was not working on his own orchard;
and
(r) the Appellant
did not work the number of hours shown on the Record of
Employment issued by Mohinder for the Period.
Surinder agrees with assumptions (j), (k), (l), (n), (o), (p),
(q) and not (s).
(j) On October
11, 2001, the Appellant received a record of employment from
Mohinder alleging 751 insurable hours of employment and $6,759
insurable earnings during the Period;
(k) the Appellant
and Nirmal's record of employment issued by Mohinder shows
identical hours;
(l) the
Appellant alleges she was paid $9.00 per hour during the Period
but was allegedly paid $10.00 per hour from Mohinder during the
2000 farming season;
(m) of four cheques issued
to the Appellant by Mohinder, only one was deposited to the
Appellant's own ban account; (as stated earlier this is not
accurate);
(n) the Appellant
was not supervised;
(o) the Appellant
worked when she wanted to;
(p) the Appellant
and her husband also obtained records of employments from the
Appellant's brother showing identical hours;
(q) the Appellant
was working on her own farm during the Period;
(r) the Appellant
helped out only when she was not working on her own orchard;
and
(s) the Appellant
did not work the number of hours shown on the Record of
Employment issued by Mohinder.
[12] Do the Appellants meet the Wiebe
Door Services Ltd. v. M.N.R.[1] tests as modified by the Supreme
Court of Canada in 671122 Ontario Ltd. v. Sagaz Industries
Canada Inc.?[2]
In effect the relevant issue is whose business was it? First
dealing with control: for the most part the Appellants were fruit
pickers for Mohinder although I do not know what they picked in
May or June. Mohinder grew apricots, peaches, cherries, prunes
and pears. As stated, the Appellants had difficulty expressing
their thoughts. Surinder does not read nor write and depended
heavily on her husband. The Appellants needed little or no
direction on how to pick. They had their own farm to take care
of. It may have taken priority over their work for Mohinder but I
do not draw that inference. Their orchard was not sufficient to
support them and they needed additional income. Their 600 cherry
trees were not bearing fruit in 2001. They worked for Mohinder
when they could without supervision other than being told where
to pick the fruit. I have no doubt they worked for Mohinder.
[13] The Appellants had the burden of
proving they were employees of Mohinder under a contract of
service. There is evidence from the Appellants that they worked
the hours claimed, supported to some extent by some cancelled
cheques and bank deposits. The assumption in paragraph 6(h) in
both appeals has been refuted by the Appellants' evidence,
payslips and banking documentation.
[14] Assumption 6(i) does not withstand
close scrutiny. In fact, it supports the Appellants' position
in that the Minister's investigator observed them working for
Mohinder on July 31, 2001. Assumptions 6(j), (k) and (l) support
the Appellants' position. Assumption 6(m) in Surinder's
Reply is not correct. Surinder did not have a bank account and
the fact that her cheques were deposited to Nirmal's account
assists the Appellants' position if anything.
[15] Assumptions 6(n) for Surinder and 6(m)
for Nirmal deal with supervision. The Respondent's counsel
referred to Gallant v. Canada[3] wherein Pratte J. stated that it is
not the control actually exercised by the employer but his power
to do so that the Court must look for. Obviously, Mohinder had
the power to control the Appellants. It was his orchard and his
money to meet his payroll.
[16] On balance, I find that the control
test favours the Appellants. The ownership of tools, chance of
profit or loss and integration tests do not offer much
assistance. I do not know who owned the tools or if any were
required. Obviously, the more hours the Appellants worked, the
more they were paid. They were not on salary but were paid
according to the product picked which amounted to $9 per hour.
The Appellants worked when they could. There was no evidence to
indicate what arrangements they had in this regard with Mohinder.
As for assumption 6(o) for Surinder and 6(p) for Nirmal, it is
understandable that the Appellants' employment records were
identical because they travelled together. Surinder did not
drive.
[17] Assumptions (q) and (r) are accurate,
but are somewhat irrelevant. They worked nine hours per day for
Mohinder and tended to their own orchard during the remaining
daylight hours.
[18] Assumptions 6(s) for Surinder and 6(r)
for Nirmal are probably the strongest argument in the
Minister's arsenal. I am very skeptical when asked to accept
that the Appellants worked nine hours a day everyday, Saturday
and Sunday included for a total of 270 hours in May 2001. They do
have some payslips and deposit evidence to support this but no
cancelled cheques. They stated that they were employed as berry
pickers yet the picking season does not start in May. They had
their own orchard to look after. They are stretching their
credibility too far in asking me to accept that they each worked
nine hours a day for 30 straight days in May. This is
unbelievable particularly considering that Surinder could not
recall when she worked in May 2001.Toiling in the fields for 30
straight days for Mohinder and then coming home and working daily
on her own six acres would be an unforgettable experience. Her
answers were always, "I do not know" or "Ask my
husband" or "Refer to the paper records". The
records were prepared as a matter of convenience, after the
fact.
[20] With respect to the remaining period,
balancing the evidence, I conclude that the Appellants presented
a prima facie case unrebutted by the Minister. The appeals
of Nirmal S. Chauhan (2003-1666(EI)) and Surinder K.
Chauhan (2003-1667 (EI)) are allowed only with respect to
the period from June 1, to August 31, 2001.
[21] Nirmal appeals the decision of the
Minister that he was not employed in insurable employment with
his brother Pritam during the eight-day period from February 18
to February 24, 2001 (2003-1665(EI)).
[22] The Appellant states that he worked 56
hours for Pritam pruning his fruit trees in February 2001. Pritam
did not testify. The Appellant's brother Mohinder managed
Pritam's fruit orchard. Mohinder did not testify. The
Minister states that Pritam had no employees and the Appellant
did not work for him during that period.
[23] I accept the evidence of Nirmal that he
pruned fruit trees for Pritam in February 2001, but find he did
so as an independent contractor, under an oral contract for
service pursuant to subparagraph 5(1)(a) of the
Employment Insurance Act.
[24] The Appellant had an expertise in
looking after fruit trees. Pritam had him trim trees on his own
time without control and according to the Appellant's set
rate of payment. It was the Appellant's business. He had
complete control of how he worked, when he worked, and how much
he was to be paid.
[25] The Appellant was not employed in
insurable employment with Pritam from February 18 to February 24,
2001 under a contract of service within the meaning of paragraph
5(1)(a). This appeal is dismissed.
Signed at Ottawa, Canada, this 31st day of March, 2004.
McArthur J.
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