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[OFFICIAL ENGLISH
TRANSLATION]
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Citation: 2003TCC275
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Date: 20030423
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Docket: 2002-3300(EI)
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BETWEEN:
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RÉGINALD THÉRIAULT,
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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
Tardif,
J.T.C.C.
[1] This
is an appeal from a determination dated July 18, 2002, in which the
respondent held that the work done by the appellant for the account and benefit
of Jocelyn Lebrun from September 12 to December 18, 1999, did
not constitute a contract of service and that it accordingly was not insurable
employment.
[2] In
making his decision, the appellant made the following assumptions of fact:
[TRANSLATION]
(a) the payer operated
a logging business in St‑Elzéar;
(b) the appellant
owned a skidder valued at approximately $15,000;
(c) during the period
in issue, the payer allegedly employed the appellant to fell trees on his
lands;
(d) in fact, the payer
and the appellant shared equally in the proceeds of the sale of wood;
(e) no written
contract was signed between the appellant and the payer;
(f) the appellant's
duties were to fell trees, transport them to the road and cut them into logs;
(g) the appellant was
purportedly paid $750 a week by the payer, whereas the payer issued a cheque
that was endorsed by the appellant and handed over to the payer;
(h) the payer then
paid the appellant purported wages in cash, whereas the money was in fact an
advance on the proceeds of sale of the wood;
(i) the payer and the
appellant sold the wood to Victorien Lemay Inc.;
(j) Victorien Lemay
Inc. paid half of the purchase price of the wood directly to the payer and the
other half directly to the appellant;
(k) once the wood was
sold and the money received from Victorien Lemay Inc., the appellant
reimbursed the payer for the gross wages and employer-employee contributions
paid by the payer;
(l) on
December 17, 1999, the payer issued a record of employment to the
appellant for the period starting on September 12, 1999, and ending on
December 18, 1999, stating 560 insurable hours and total insurable
earnings of $10,483.20;
(m) the appellant was
responsible for maintaining his skidder;
(n) the appellant
assumed the cost of gasoline and spare parts for the skidder;
(o) the appellant
operated his own business;
(p) the payer and the
appellant entered into an arrangement to enable the appellant to qualify for
employment insurance benefits.
[3] The
appellant essentially contended that he had performed his work as he had done
for a number of years and that he had previously never had any problem
obtaining employment insurance benefits; his submissions respecting the manner
of performing the work and, more specifically, the remuneration were vague and
unclear. The evidence brought by the appellant was so unclear that he did not
discharge his burden of proof.
[4] He
essentially stated and repeated that he had never had any problem qualifying
for employment insurance. The answers to the Court's questions were confused;
what is more, it seemed quite clear that there had been genuine collusion
between him and the woodlot owner, the payer Lebrun, so that he could qualify
for employment insurance benefits.
[5] The
respondent, for his part, had Pierre Savoie, the person responsible for
the investigation in the appellant's case, testify. Mr. Savoie outlined
the scheme used by the appellant and the payer, Jocelyn Lebrun, who had
agreed to issue cheques to the appellant to cover the period in issue; the
cheques were immediately endorsed and handed back. In addition, the
investigator observed that the cheques from the account of
Jocelyn Lebrun's business had been redeposited to his personal account
bearing another folio number.
[6] He had
not been able to determine whether the payer had paid the appellant in cash,
the documentary evidence showing quite decisively that there had been no
payment. Instead the appellant was paid 50 percent of the amount obtained
when the wood was sold.
[7] It
appears that, during the investigation, the alleged employer categorically
refused to cooperate by providing explanations and relevant documents that
could confirm that the record of employment was not false.
[8] It
could also be observed from Mr. Savoie's investigation that the appellant
worked during the periods when he received employment insurance benefits and
sold wood using the account of his spouse's business. In other words, it
appears from the investigator's testimony that the appellant was involved in
various schemes to obtain employment insurance benefits without entitlement; he
worked during the periods when he was receiving such benefits.
[9] The
evidence brought by the respondent showed on balance that the version of the
facts presented by the appellant was inconsistent with his claims. In light of
the evidence adduced, there is no doubt that the appellant's explanations are
in no way credible and that the record of employment was the result of an
agreement for the sole purpose of qualifying the appellant for employment
insurance benefits.
[10] In
actual fact, the appellant did indeed perform work on Jocelyn Lebrun's
property. It was work consisting in felling, transporting and cutting wood
using his skidder. The wood was subsequently sold, and the appellant received
50 percent of the proceeds of the sale. This was therefore not a contract
of service, but essentially work performed as part of his own business.
[11] As
business income was payable when the wood was sold, the appellant and the owner
of the land where the sold wood had been cut entered into a false arrangement
suggesting that there was a contract of service. In actual fact, the cheques
were not cashed by the appellant; they served only to create an appearance of a
contract of service.
[12] In
conclusion, it was shown on a balance of probabilities that the appellant
performed work as a contractor, not as an employee; the work was disguised and
arranged so that he could qualify for employment insurance benefits, which
clearly confirms that the determination here in appeal, that the work performed
by the appellant was not done as part of a genuine contract of service, was
correct.
[13] For
these reasons, the appeal is dismissed.
Signed at Ottawa, Canada, this
23th day of April 2003.
J.T.C.C.
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