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Citation: 2003TCC572
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Date: 20030812
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Docket: 2002-4135(EI)
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BETWEEN:
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JUDY D'ANGELO AND PETER D'ANGELO,
O/A SHOREHAVEN TERRACE APARTMENTS,
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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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AND
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2002-4136(CPP)
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BETWEEN:
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JUDY D'ANGELO AND PETER D'ANGELO,
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O/A SHOREHAVEN TERRACE APARTMENTS,
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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
Bowman,
A.C.J.
[1] These
appeals are from determinations made under the Employment Insurance Act and
the Canada Pension Plan that Sherri L. Chapple was employed by
the appellants in insurable and pensionable employment during the period from
January 1, 2001 to December 20, 2001. A similar ruling for the period
of February 1, 1999 to December 31, 2000 was made on
February 22, 2002 but an appeal was not taken, possibly because the
ruling request was not made in time. At all events counsel for the respondent
informed me that the Minister would, as a matter of administrative policy,
reassess the earlier periods if the decision in this appeal is in favour of the
appellants.
[2] The
appellants, who live in Toronto, own a 44‑unit apartment building in
North Bay. Sherri Chapple ("Sherri") and her spouse
Michael Cameron ("Mike") were tenants in this building. The
appellants needed a superintendent for the building because the existing
superintendent was leaving. They approached Sherri and Mike in the fall of 1998
and on January 8, 1999 the appellants signed an agreement with Sherri described
as a Superintendent Contract. To the agreement was attached a three‑page
schedule outlining Sherri's duties.
[3] Under
the agreement Sherri agreed to be the building superintendent. Her
responsibilities included tenant comfort, care and security, building and
ground cleaning, maintenance of all systems, minor repairs and restoration,
including plumbing, electrical, mechanical and carpentry work, painting, and
bathoom restoration. She was paid $750 per month and was given a free
apartment.
[4] Although
he did not sign the contract it was understood by all parties that the contract
was also with Mike. While he was there Mike did the outside work, the painting
and some of the plumbing, whereas Sherri did the cleaning and the tenant
relations.
[5] Mike
left Sherri in December 1999 as the result of matrimonial problems. He moved
back with Sherri in 2002 after she had left the apartment and the position as
superintendent.
[6] While
Mike lived with Sherri they shared the work more or less equally. The reason he
did not sign the contract was that he had been receiving a disability pension
and was concerned if he were shown as working for the appellant it might be difficult
to resume his disability pension.
[7] After
he left, Mike came back from time to time to help Sherri with some of the jobs,
but essentially Sherri was left with the full responsibility. Occasionally a
friend of Sherri's, Robert Gauthier, would come and help with some of the jobs.
For this he would be paid separately by the appellants.
[8] Relations
between Sherri and the appellants deteriorated. Some of her functions were
contracted out to others and ultimately Sherri left. The dispute arose because
Sherri demanded vacation pay which the appellants refused on the basis that she
was an independent contractor. The matter came before the Ontario Labour
Relations Board and the appellants were ordered to pay a total of $2,056.73.
Ultimately the parties settled for one half of this amount. However, the
dispute came to the attention of the Canada Customs and Revenue Agency and the
result was the determination that is in issue here.
[9] The
question of course is: Was Sherri an employee of the appellants or was she an
independent contractor, or, put differently, was her contract with the
appellants of service or for services?
[10] In a very thorough and well researched argument the appellants point
to a number of considerations that they contend support the view that Sherri
was an independent contractor.
(a) the relative lack of supervision
by them since they lived in Toronto;
(b) the fact that the contract was
essentially with both Sherri and Mike;
(c) the fact that she
was free to take other cleaning jobs, such as ERB Transport or Jackman
Flowers;
(d) the fact that her
hours for doing the various jobs were relatively flexible.
[11] There are no hard and fast rules for determining these questions. Each
case turns on its own facts. Some factors may point in one direction, others in
another. Each must be assigned its proper weight in the context of the overall
relationship. MacGuigan J. developed a four-in-one test in Wiebe Door
Services Ltd. v. M.N.R., [1986] 3 F.C. but he acknowledged that no single
test has been found.
[12] In 671122 Ontario Ltd. v. Sagaz Industries Canada Inc.,
[2001] 2 S.C.R. 983 Major J., speaking for the Court said at paragraphs 46, 47
and 48:
In my opinion, there is no one conclusive test which
can be universally applied to determine whether a person is an employee or an
independent contractor. Lord Denning stated in Stevenson Jordan,
supra, that it may be impossible to give a precise definition of the
distinction (p. 111) and, similarly, Fleming observed that "no single test
seems to yield an invariably clear and acceptable answer to the many variables
of ever changing employment relations ..." (p. 416). Further, I agree with
MacGuigan J.A. in Wiebe Door, at p. 563, citing Atiyah, supra, at p. 38, that
what must always occur is a search for the total relationship of the parties:
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[I]t is exceedingly doubtful whether the search for a formula
in the nature of a single test for identifying a [page1005] contract of
service any longer serves a useful purpose.... The most that can profitably
be done is to examine all the possible factors which have been referred to in
these cases as bearing on the nature of the relationship between the parties
concerned. Clearly not all of these factors will be relevant in all cases, or
have the same weight in all cases. Equally clearly no magic
formula can be propounded for determining which factors should, in any given
case, be treated as the determining ones.
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Although there is no universal test to determine
whether a person is an employee or an independent contractor, I agree with
MacGuigan J.A. that a persuasive approach to the issue is that taken by Cooke
J. in Market Investigations, supra. The central question is whether
the person who has been engaged to perform the services is performing them as a
person in business on his own account. In making this determination,
the level of control the employer has over the worker's activities will always
be a factor. However, other factors to consider include whether the
worker provides his or her own equipment, whether the worker hires his or her
own helpers, the degree of financial risk taken by the worker, the degree of
responsibility for investment and management held by the worker, and the
worker's opportunity for profit in the performance of his or her tasks.
It bears repeating that the above factors constitute a
non-exhaustive list, and there is no set formula as to their
application. The relative weight of each will depend on the
particular facts and circumstances of the case.
[13] Some of the factors that have been mentioned are control, ownership of
tools, chance of profit and risk of loss, integration. The last, integration,
has never been a particularly useful or meaningful test, at least in the
context of the cases which we have to consider under the Employment
Insurance Act or the Canada Pension Plan.
[14] So far as the others are concerned, Sherri was paid a monthly salary.
Her time was not her own — she had to be on call or in the building for a large
part of the day, her other cleaning jobs were done on weekends or at night,
virtually all the tools were supplied by the appellants and her salary was the
same whether there were vacancies or not. Although the appellants did not
directly supervise her work she was given a specific set of rules to follow. I
do not think that the relative autonomy that she enjoyed was inconsistent with
an employment relationship. It was the type of autonomy enjoyed by any trusted
and skilled employee. Even applying the "traditional" tests, singly or cumulatively, she was an employee. More importantly, the
overall relationship has the usual earmarks of employment.
[15] The appeals are dismissed.
Signed at Toronto, Ontario, this 12th day of
August 2003.
A.C.J.
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