|
Citation: 2003TCC828
|
|
Date: 20031113
|
|
Docket: 2003-424(EI)
2003-423(CPP)
|
|
BETWEEN:
|
|
GORDON DICKISON,
|
|
Appellant,
|
|
and
|
|
|
|
THE MINISTER OF NATIONAL REVENUE,
|
|
Respondent.
|
REASONS FOR JUDGMENT
(delivered
orally from the Bench at
Regina,
Saskatchewan on October 2, 2003)
Beaubier,
J.
[1] These appeals were heard together on common
evidence at Regina, Saskatchewan on October 1, 2003. The Appellant was the
only witness.
[2] The particulars in appeal are set out at paragraphs three to eight
inclusive of the Reply to the Notice of Appeal, number 2003-424(EI), which
read:
3. On February 1, 2002, Human Resources
Development Canada requested a ruling from the Canada Customs and Revenue
Agency with respect to, among other things, whether the Worker was engaged in
insurable employment with the Appellant during the period from September 15,
2001 to November 1, 2001.
4. By letter dated May 9, 2002, a CPP/EI
Coverage Officer with the Canada Customs and Revenue Agency advised the
Appellant of his ruling that, among other things:
(a) the Worker was employed in
insurable employment during the period from September 15, 2001 to November 3,
2001, as the Worker was employed pursuant to a contract of service;
(b) Bert Baxter Transport Ltd.
(hereinafter referred to as "Baxter") was the actual employer of the
Worker; and
(c) the Appellant was the deemed
employer of the Worker, since the Appellant paid the Worker.
5. By Notice of Appeal dated July 12, 2002,
Baxter appealed to the Minister for reconsideration of the ruling that it was
the actual employer of the Worker.
6. By letter dated November 29, 2002, the
Minister advised the Appellant of his decision that the employment of the
Worker was insurable during the period from September 15, 2001 to November 3,
2001 as the Worker was employed under a contract of service and was, therefore,
an employee of the Appellant.
7. In deciding as he did, the Minister relied
on the following assumptions of fact:
(a) Baxter is in the business of
transporting freight;
(b) the Appellant owned a tractor
trailer unit described as IHO, 9300 Tractor/S/N 2HSFBASR7TC033507 (hereinafter
referred to as the "Truck");
(c) pursuant to a written agreement
between the Appellant and Baxter effective July 12, 2000, the Appellant agreed
to lease the Truck to Baxter;
(d) although there was no written
agreement between the Appellant and Baxter with respect to the Appellant
providing a driver for the Truck, both the Appellant and Baxter agreed that the
Appellant would provide a driver for the Truck;
(e) pursuant to a written agreement
between the Appellant and the Worker, the Appellant hired the Worker to drive
the Truck;
(f) other than the Truck, the
Worker did not drive any other vehicles of the Appellant;
(g) the Appellant paid the Worker in
respect of driving the Truck;
(h) the Worker was paid at a rate of
$0.34 per mile, plus $25.00 for tarping and $50.00 for layovers;
(i) the rate of pay received by the
Worker was set by the Appellant;
(j) the Appellant required that the
Worker treat the Truck with respect and maintain it to proper safety standards;
(k) if the Truck needed repairs,
other than for regular or ordinary maintenance and for those repairs of a
safety or regulatory nature, the Worker was required to obtain authorization
from the Appellant with respect to payment and the source of the repairs;
(l) Baxter instructed the Worker
with respect to where and when he was to pick up and deliver loads;
(m) the Worker was required to check
in with Baxter by telephone on a daily basis;
(n) the Appellant conducted a road
test on the Worker;
(o) Baxter provided the Worker with
a fuel card;
(p) the
cost of the fuel charged on the fuel card that was given to the Worker was
charged back to the Appellant by Baxter;
(q) Baxter
also charged back to the Appellant the cost of insurance, tolls, cell phones,
workers’ compensation and repairs;
(r) generally, the Worker charged
all the expenses he incurred;
(s) the
Worker was reimbursed in respect of the expenses he incurred;
(t) the
Worker was able to obtain cash advances of up to $50.00 U.S. per day on the
fuel card;
(u) the
cash advances received by the Worker, along with a $5.00 surcharge from Baxter,
were charged back to the Appellant by Baxter;
(v) the
Appellant deducted the cash advances from the wages and/or the expense
reimbursements it paid to the Worker;
(w) Baxter
provided the Appellant with detailed statements twice per month in respect of
the use of the Truck (the “Statements”);
(x) the
Statements included a revenue section which indicated, among other things, the
total revenue earned, the departure and arrival dates, the origin and
destination of the trips and the number of kilometres driven;
(y) the
Statements included a deductions section which indicated the total deductions made
in respect of expenses or charges such as, cash advances, surcharges, cell
phones, drug and alcohol service charges (for drug and alcohol tests), gas,
repairs, insurance, workers’ compensation, weigh scale fees and tolls; and
(z) the
Worker was employed under a contract of service with the Appellant.
B. ISSUE TO BE
DECIDED
8. The issue to be
decided is the Worker was employed under a contract of service with the
Appellant.
[3] Assumptions 7(a), (b), (c), (d) by trade
usage, (e) by Exhibit A-1, Ex 5), and the fact that this was the only truck
available for Lloyd Hayward, (f), (g), (h), (i), (j), (k), (l), (m), (n) -
Exhibit R-1, which document effectively refutes Mr. Dickison’s contrary
testimony, (o), (p), (t), (v), (w), (x) and (y) were not refuted. Assumption
(z) is the subject of the litigation.
[4] With respect to the
remaining assumptions:
7(q) Baxter
paid $75 of the monthly cell phone bill and Mr. Hayward paid the rest.
7(r) Mr.
Hayward paid all his personal expenses.
7(u) Mr.
Hayward paid these.
[5] The Appellant drew
up a contract (Exhibit A-1, Ex 5) which Mr. Hayward signed.
It reads as follows:
BROKER OPERATOR CONTRACT
I, Lloyd Hayward have agreed to work
as a broker operator for Gordon Dickison. As a broker operator, I am to operate
for a term depending on the amount of work available. My movements are
controlled by Bert Baxter Ltd. to which Gordon Dickison has his vehicle(s)
leased to. I will treat the vehicle(s) with respect, and maintain said
vehicle(s) to proper safety standards. If truck or trailer need repairs, other
than regular or ordinary maintenance and those of a safety or regulatory nature
Gordon Dickison or Bert Baxter Ltd. must give authorization for payment and
source of repair.
The contract shall begin on Summer 2001
and shall commence on the first available load offered by Bert Baxter Ltd. The
contract shall cease at the option and in the order of Bert Baxter Ltd, Gordon
Dickison and the broker operator.
I allow Gordon Dickison to deduct all cash
advances from my contract payment. I will be reimbursed for all bills that the
vehicle has incurred and will hand them in. All bills have to be dated and
state what they are for. Any cost incurred to said vehicle(s) that is of my
doing, I agree the cost shall be deducted from my contract.
The rate of contract payment is based on
Bert Baxter Ltd. computer paid miles to the truck at the rate of $.34/mile.
Tarping @ $25.00
Layover @ $50.00
Tolls @ what ever Gordon Dickison receives
from Bert Baxter Ltd. If they are not reported, they can not be paid back to
the contractor.
I understand I am to be responsible for any
recordings of my income with the government. GST will not be charged from the
broker operator to Gordon Dickison as this contract is considered interlining. I
understand these terms and am satisfied with them.
SIGNATURE "Lloyd Hayward"
SIGNATURE "Gordon Dickison"
In essence this
contract delegates to Bert Baxter Ltd. control over Mr. Hayward on behalf of
the Appellant. Bert Baxter Ltd. exercised the control accordingly and the
Appellant paid Mr. Hayward.
[6] As a result, using
the tests set out in Wiebe Door Services Ltd. v. M.N.R., 87 DTC 5025,
the Court finds:
1. Control
– was exercised by the Appellant pursuant to the contract drawn by the
Appellant and accepted by Mr. Hayward.
2. Ownership
of Tools – The main operating "tool", the tractor, was owned by
the Appellant; any trailer was owned by Bert Baxter Ltd., whom the Appellant
designated as his agent in the contract; and Mr. Hayward owned some small repair
tools.
3. Chance
of Profit and Risk of Loss – Mr. Hayward had little risk of loss as any
layover would reimburse him at $50 per day, which is not much, but he had the
tractor cab. Mr. Dickison testified that Mr. Hayward was responsible for any
costs he incurred arising from his negligence which were not otherwise insured
by the tractor insurance. However, normally these would be covered by his
operator insurance. His "profit" was his mileage rate. On the whole,
the liability point is somewhat ambiguous and in the Court's view may very well
be over-ridden by the fact that the Appellant's contract does not impose this
liability on Mr. Hayward, in which case such costs would be the Appellant's.
4. Integration
– Mr. Hayward was wholly integrated into the one truck he was driving. None of
the Appellant's other trucks were available to him.
[7] Mr. Hayward was not
in business for himself. He was a truck driver in the employ of the Appellant,
paid by the Appellant pursuant to the Appellant's own contract and in control
of the Appellant's agent.
[8] The appeal is
dismissed.
Signed at Ottawa,
Canada this 13th day of November 2003.
Beaubier,
J.
Email this Content