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Citation:2003TCC439
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Date: 20030627
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Dockets: 2002-410(CPP)
2002-411(EI)
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BETWEEN:
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URANIUM CITY HOSPITAL,
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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
Rowe, D.J.T.C.C.
[1] The appellant appeals from two
decisions - both dated October 23, 2001 - issued by the Minister
of National Revenue (the "Minister"). The Minister
decided Joanne Chisan (Chisan or worker) had been employed in
both insurable and pensionable employment with Uranium City
Hospital (Hospital or payor) for the periods of August 21, 2000
to September 4, 2000, October 30, 2000 to November 13, 2000,
January 30, 2001 to February 13, 2001 and April 30, 2001 to May
14, 2001. The decisions were issued pursuant to the relevant
provisions of the Employment Insurance Act (the
"Act") and the Canada Pension Plan (the
"Plan"), respectively.
[2] As requested by counsel, the two
appeals were heard together.
[3] Andrew Cebryk testified he resides
in Lanigan, Saskatchewan and - on a part-time basis - is the
Chief Executive Officer (CEO) of Hospital situated in Uranium
City, Saskatchewan. He studied at the University of Saskatchewan
and the University of Ottawa and earned a certificate in Health
Care Administration. He began his career in health administration
- in 1972 - serving as the CEO at Lanigan Hospital and later
held the CEO position at Living Sky Health District. After
retiring in 1998, he returned to work in August, 1999, by
assuming the part-time CEO position at Hospital. At that
time, five nurses had resigned and no replacements could be
recruited. As a result, Hospital decided to retain the services
of nurses on a contract for services basis and had obtained the
approval of the Saskatchewan Union of Nurses (SUN) prior to
embarking on that course. During the hiatus of nursing coverage,
in-patient services were suspended but out-patient and emergency
services were maintained. Patients requiring further and/or other
forms of medical treatment were evacuated by air transport
(medivaced) to hospitals in the south.
[4] In cross-examination, Andrew
Cebryk stated Hospital currently operates under an
Order-in-Council and the Minister of Health appoints members from
various communities to serve on the Board of Directors. Cebryk
receives his remuneration from Hospital even though he was
recruited by the provincial Ministry of Health (MOH).
[5] Joanne Chisan testified she is a
Registered Nurse (RN) residing in Saskatoon, Saskatchewan. She
graduated - in 1984 - from Wascana Institute in Regina and after
working in that city for one year, moved to Saskatoon where she
worked 11 years for the Royal University Hospital (RUH). Later,
she started working for the air-ambulance unit, operated by
MOH. In both of these work situations she had been an employee
and a member of SUN. While working at the air-ambulance unit, she
learned about the appellant's search for individuals - referred
to as "contract nurses" - willing to provide
nursing services at Uranium City in northern Saskatchewan, a
small, isolated community accessible only by air. The rate of pay
offered by Hospital was greater than the daily rate applicable to
her regular annual salary. On November 29, 1999, Chisan entered
into a contract - Exhibit A-2 - with Hospital wherein she agreed
to provide her nursing services on a rotating basis - for a
period of two weeks per trip - on the basis that she would be a
self-employed professional. However, that original contract
covered only the period from November 29 to December 10, 1999.
Thereafter, Addendum A - attached to the contract after the last
page - was utilized by the parties in order to extend the
contract from time to time. Pursuant to her agreement, she worked
at Hospital from November 29 to December 10, 1999, then returned
to her regular employment at RUH in Saskatoon. She did another
rotation at Hospital between April 24 and May 8, 2000
and then returned to Uranium City between August 21 and September
4, 2000 and from October 30 to November 13, 2000. Each time,
after finishing the two-week period, she returned to her regular
employment at RUH. In 2001, she worked at Hospital from January
30 to February 13 and from April 30 to May 14. Other two-week
periods had been arranged but Chisan stated she had to cancel her
commitment due to a serious illness which caused her to be
hospitalized for two months. In 2002, she undertook another
two-week assignment at Hospital but became ill due to a reaction
to some medication and had to be medivaced out of Uranium City
back to Saskatoon. As a result, she was not able to earn the
remainder of her daily fee - as set forth in the contract with
Hospital - and there was no other financial compensation
forthcoming. Chisan stated she was able to provide her services
to Hospital - on a periodic basis - because she was able to
derive the benefit of flexible scheduling at RUH in order to
accommodate the timeframes during which the appellant required
her services. The payment for services began at the rate of
$400 per day, including an allowance for two days travel -
in and out - of Uranium City and Hospital also paid the
airfare, food and travel expenses to and from the airport. Chisan
referred to Clause 5.0 - entitled Indemnification - in which she
(as the Contractor) agreed to save Hospital harmless and
indemnify it from any claims, demands, causes of action of any
nature whatsoever that may be made against the Hospital by reason
of any act or omission on her part arising from the provision of
her services pursuant to their agreement. Pursuant to Clause 6.0
of said contract, she agreed not to assign or transfer the work
or services to another person without the prior written consent
of Hospital. While performing general nursing duties for Hospital
during her two-week stints, Chisan stated there was no
supervision of her work other than by attending physicians. She
lived inside the facility and also ate her meals there since
there were no hotels or cafés in Uranium City. Chisan
stated she reported the income earned from providing services to
Hospital on the basis she was self-employed. She earned
additional income by performing medical examinations for
insurance companies and selling Avon products. These forms of
income were also included in the category of business income
against which Chisan deducted in-home office expenses
attributable to generation of that revenue. Prior to agreeing to
provide her services to Hospital, Chisan stated she confirmed -
with SUN - that her existing professional liability coverage was
adequate and would apply to nursing services performed pursuant
to her contractual arrangement with Hospital. Chisan stated that
in addition to union dues, she was required to pay an annual
licensing fee which included the premium for liability
insurance.
[6] In cross-examination by counsel
for the respondent, Joanne Chisan was referred to the
Questionnaire - Exhibit R-1 - she had completed on October 8,
2001. She agreed her memory of events would have been fresher at
that time. At subparagraph 9(b) thereof, in response to the
question, "[W]ho supervised you" she responded,
"[H]ead Nurse, and/or doctors". Chisan stated the
position of Head Nurse was filled by Lisa Clark, also working on
contract based on a rotation of two weeks in followed by two
weeks out. At subparagraph 4(c) of said Questionnaire,
Chisan agreed the rate of $400 per day had been set by the Board
of Directors. Chisan stated she was on call 24 hours per day, 7
days a week while at Uranium City but could take some personal
time during the day. At any given time, two nurses were on duty
to work with the three physicians who were residents of Uranium
City. She agreed the appellant provided all the necessary tools
and equipment. With respect to income, she reported three
different sources on her tax returns for the relevant years
including amounts received from employment, performing medical
examinations and selling Avon products.
[7] Donald Stewart testified he
obtained his Chartered Management Accountant (CMA) designation
after having obtained a Bachelor of Commerce degree from the
University of Saskatchewan. Since June, 2000, he has been
Director of Finance for the appellant. In order to demonstrate
the remoteness of Uranium City, Stewart referred to a map -
Exhibit A-3 - on which the three communities of Stony Rapids,
Black Lake and Uranium City were highlighted - in yellow - near
the Saskatchewan/Alberta border. Additional communities served by
Hospital are Fond du Lac and Camsell Portage. The population
of that region is approximately 3,500 but Uranium City now has a
population of approximately 150. At one point, when it was the
centre of uranium mining, the population was about 6,000 but
since the decline of that industry there are no businesses
remaining to offer lodging, food, beverages or entertainment.
During the relevant periods - and currently - Uranium City is
accessible only by air since the barge service is no longer
operating from Fort McMurray, Alberta. Due to stops at various
communities, a flight to Uranium City from Saskatoon takes
between 5 and 6 hours, although the actual flying time is about 2
hours. Stewart stated it was difficult to find other nurses
willing to work at Hospital after the resignation of the 5 staff
nurses. The appellant advertised for replacements but was
unsuccessful. As a result, the Board of Hospital decided to
pursue a course of action designed to attract interest from
nurses who wanted to be independent contractors and provide their
services during two-week periods since it was accepted there
would be problems having nurses work for any longer period due to
the lack of amenities and the isolation. Stewart referred to an
Auditor's Report - Exhibit A-4 - dated August 18, 2000 - provided
to Members of the Legislative Assembly of Saskatchewan. At Note
1, there is a statement that " [A]s of August 8, 1999
inpatient services at the Uranium City Hospital were suspended
due to staff shortages".
[8] Counsel for the respondent did not
cross-examine.
[9] Counsel for the appellant
submitted the working relationship between Chisan and the
appellant was somewhat unusual in light of the urgent
circumstances following the suspension of certain services
following the resignation of the entire nursing staff and the
inability of the appellant to hire replacement nurses as
employees. Counsel submitted that any marginal amount of
supervision over nurses was undertaken by physicians who were not
employees of the appellant and only in the context of providing
medical care to patients. Further, counsel referred to the
ability of Chisan to determine which time periods suited her own
work schedule and the presence of risk due to potential
professional liability which may not have been fully protected by
the insurance coverage provided to her as a member of her union.
In addition, counsel pointed to the financial risk suffered by
Chisan - in 2002 - when she became ill while working at Hospital
and had to return home by air ambulance prior to the expiration
of her two-week rotation, thereby losing income. Counsel
submitted the trend in recent jurisprudence supported the
position that the intent of the parties should be respected when
regarded in the context of circumstances applicable to the
working relationship and that the totality of the evidence
demonstrated Chisan was not an employee of Hospital during the
relevant periods.
[10] Counsel for the respondent submitted
the Supreme Court of Canada - in a recent decision - had
clarified the state of the law in this regard. Counsel referred
to evidence of supervision and control in the sense the worker
reported to the physicians and was working in a hospital
environment in which there was a designated Head Nurse. Due to
the nature of the service provided, counsel conceded the indicia
of tools and equipment was not relevant but submitted that taking
all other factors into account, the worker was providing her
services to the appellant - not pursuant to any status
of independent contractor - but as a part-time employee working
specified periods on an irregular basis.
[11] The Supreme Court of Canada - in a
recent decision - 671122 Ontario Ltd. v. Sagaz Industries
Canada Inc., [2001] 2 S.C.R. 983 - (Sagaz) dealt with
a case of vicarious liability and in the course of examining a
variety of relevant issues, the Court was also required to
consider what constitutes an independent contractor. The judgment
of the Court was delivered by Major, J. who reviewed the
development of the jurisprudence in the context of the
significance of the difference between an employee and an
independent contractor as it affected the issue of vicarious
liability. After referring to the reasons of MacGuigan, J.A. in
Wiebe Door Services Ltd. v. M.N.R., [1986] 2 C.T.C. 200
and the reference therein to the organization test of Lord
Denning - and to the synthesis of Cooke, J. in Market
Investigations, Ltd. v. Minister of Social Security, [1968]
3 All E.R. 732 - Major, J. at paragraphs 45 to 48,
inclusive, of his judgment stated:
Finally, there is a test that has emerged that relates to the
enterprise itself. Flannigan, ... ("Enterprise control: The
servant-independent contractor distinction" (1987), 37
U.T.L.J. 25, at p. 29) sets out the "enterprise test"
at p. 30 which provides that the employer should be vicariously
liable because (1) he controls the activities of the worker; (2)
he is in a position to reduce the risk of loss; (3) he benefits
from the activities of the worker; (4) the true cost of a product
or service ought to be borne by the enterprise offering it.
According to Flannigan, each justification deals with regulating
the risk-taking of the employer and, as such, control is always
the critical element because the ability to control the
enterprise is what enables the employer to take risks. An
"enterprise risk test" also emerged in La Forest
J.'s dissent on cross-appeal in London Drugs where he stated
at p. 339 that "[v]icarious liability has the broader
function of transferring to the enterprise itself the risks
created by the activity performed by its agents".
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, ... ([1952] 1 The Times L.R. 101) 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, ...(Vicarious Liability in the Law of
Torts. London: Butterworths, 1967) at p. 38, that what must
always occur is a search for the total relationship of the
parties:
[I]t is exceedingly doubtful whether the search for a formula
in the nature of a single test for identifying a 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.
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.
[12] I will examine the facts in relation to
the indicia set forth in the judgment of Major, J. in
Sagaz.
Level of control:
[13] The worker was obliged to follow the
orders of the physicians attending patients in the hospital but
the physicians were not employees of the appellant nor was there
any evidence they had been hired to exercise any wider
supervisory function over the worker or other nurses. Adhering to
the dictates of the physicians is a professional obligation
inherent in the nursing discipline and does not denote control in
the usual sense absent other circumstances indicative of a
hierarchical structure usually associated with an
employer/employee relationship. The worker was an experienced
professional and well aware of her duties and responsibilities.
There was a Head Nurse and in that sense there was an individual
to whom the worker reported, as required.
Provision of equipment and/or helpers
[14] This factor is not particularly
relevant. Chisan provided her time, talent and dedication to her
task. However, she did have the right to assign her duties to
another person provided she could obtain the prior written
approval of the appellant. That is not the option - albeit
restricted - one would expect to be permitted by an employer when
engaging the services of individuals on the basis they will be
employees.
Degree of financial risk and responsibility for investment
and management
[15] The relevant periods covered by the
decision of the Minister commence on August 21, 2000 and end on
May 14, 2001. However, the worker began providing her nursing
services to the appellant in November, 1999 and - following
recovery from her subsequent illness - returned in 2002 only to
become ill again due to a different cause. Obviously, the worker
was also at financial risk during the limited period covered by
the Minister's decision. In 2002, when she became ill and had to
be flown to a hospital in Saskatoon, she lost her daily
remuneration of $400 for the remaining days of the contracted
service period. Throughout, the worker managed her flexible work
schedule at RUH and/or at the air ambulance unit - in her
capacity as an employee - in order to have time available during
which she could earn a fixed daily fee - in excess of her regular
salary - by agreeing to provide her services to the appellant.
There was also some degree of risk associated with the
indemnification clause included in her contract with the
appellant. Although she had professional liability coverage as
part of her union membership benefits, there was still a greater
risk than had she been sued for negligence while an employee of
either RUH or the air ambulance unit operated by MOH. When one is
an employee, the employer is required to bear the brunt of the
litigation but pursuant to a contract for services featuring an
indemnification clause, one may - on occasion - find themselves
at odds with their own insurer due to certain exclusionary
language and/or statutory conditions. The worker was not required
to make any investment in order to carry out the terms of her
contract with the appellant nor was she expected to exercise any
management function within the medical facility other than that
required in the discharge of her professional duties.
Opportunity for profit in the performance of tasks
[16] The worker accepted the sum of $400 per
day for her services including two days allotted for travel in
and out of Uranium City. The appellant agreed to pay air fare and
travel costs in accordance with provincial government rates in
effect from time to time. The opportunity for profit lay in the
efficient use of her time in the midst of a crowded calendar that
had Chisan juggling the demands of full-time employment,
part-time entrepreneurial endeavours - such as carrying out
medical examinations for insurance companies and selling Avon -
and undertaking to provide her services on a rotating basis to
the appellant.
[17] In the case of Minister of National
Revenue v. Emily Standing, [1992] F.C.J. No. 890 Stone,
J.A. stated:
...There is no foundation in the case law for the proposition
that such a relationship may exist merely because the parties
choose to describe it to be so regardless of the surrounding
circumstances when weighed in the light of the Wiebe Door
test ...
[18] In Wolf v. Canada, [2002] DTC
6853, the Federal Court of Appeal
- post-Sagaz - considered the income tax
appeal of a mechanical engineer specializing within the aerospace
industry. The question arose whether that appellant was an
employee of Canadair or an independent contractor. Analysis of
the various factors to be taken into account in deciding this
issue was based upon the relevant articles of the Civil Code of
Québec in addition to the applicable jurisprudence up to
and including the decision of the Supreme Court of Canada in
Sagaz, supra. For purposes of the within appeals, the
interesting aspect of the decision of the Federal Court of Appeal
in Wolf concerns the weight to be given to the intent of
the parties in determining the characterization of their working
relationship. The discussion is significant in that the caveat
inherent in the words of Stone J.A. in Standing, supra,
have served to remind parties they cannot merely affix a label to
their working situation and expect it to stick unless the overall
context otherwise permits. Prior to concluding that the
engineer's relationship with Canadair had been that of an
independent contractor, Desjardins, J.A. - at paragraph 93 of her
reasons for judgment - stated:
Both Canadair's work and the appellant's work
were integrated in the sense that they were directed to the same
operation and pursued the same goal, namely the certification of
the aircraft. Considering, however, the fact that the integration
factor is to be considered from the perspective of the employee,
it is clear that this integration was an incomplete one. The
appellant was at Canadair to provide a temporary helping hand in
a limited field of expertise, namely his own. In answering the
question 'whose business is it?' from that angle, the
appellant's business stands independently. Once
Canadair's project was completed, the appellant was, so to
speak, ejected from his job. He had to seek other work in the
market place. He could not stay at Canadair unless another
project was under way.
[19] Décary, J.A. - concurring in the
result - commented at paragraph 115 of his reasons:
As a starting point, I would like to quote the very
first paragraph of an article written by Alain Gaucher (A
Worker's Status as Employee or Independent Contractor, 1999
Conference Report of Proceedings of the 51st Tax Conference of
the Canadian Tax Foundation, p. 33.1):
In an ever-changing Canadian economy, the legal relevance of a
worker's status as independent contractor or employee
continues to be important. The issues relating to employment
status will only increase in importance as employers continue to
move toward hiring practices that favour independent contractors
and a greater number of individuals enter or re-enter the work
force as independent contractors.
[20] At paragraphs 117 to 120, inclusive,
Décary, J.A. continued as follows:
The test, therefore, is whether, looking at the total
relationship of the parties, there is control on the one hand and
subordination on the other. I say, with great respect, that the
courts, in their propensity to create artificial legal
categories, have sometimes overlooked the very factor which is
the essence of a contractual relationship, i.e the intention of
the parties. Article 1425 of the Civil Code of Quebec establishes
the principle that ' [t] he common intention of the parties
rather than the adherence to the literal meaning of the words
shall be sought in interpreting a contract'. Article 1426
C.C.Q. goes on to say that ' [i] n interpreting a contract,
the nature of the contract, the circumstances in which it was
formed, the interpretation which has already been given to it by
the parties or which it may have received, and usage, are all
taken into account'.
We are dealing here with a type of worker who chooses
to offer his services as an independent contractor rather than as
an employee and with a type of enterprise that chooses to hire
independent contractors rather than employees. The worker
deliberately sacrifices security for freedom ('the pay was
much better, the job security was not there, there were no
benefits involved as an employee receives, such as medical
benefits, pension, things of that nature...' Mr. Wolf's
testimony, Appeal Book, vol. 2, p. 24). The hiring company
deliberately uses independent contractors for a given work at a
given time ('it involves better pay with less job security
because consultants are used to fill in gaps when local
employment or the workload is unusually high, or the company does
not want to hire additional employees and then lay them off.
They'll hire consultants because they can just terminate the
contract at any time, and there's no liabilities
involved', ibid., p. 26). The hiring company does not, in its
day-to-day operations, treat its consultants the same way it
treats its employees (see para. 68 of Madam Justice
Desjardins's reasons). The whole working relationship begins
and continues on the basis that there is no control and no
subordination.
Taxpayers may arrange their affairs in such a lawful
way as they wish. No one has suggested that Mr. Wolf or Canadair
or Kirk-Mayer are not what they say they are or have
arranged their affairs in such a way as to deceive the taxing
authorities or anybody else. When a contract is genuinely entered
into as a contract for services and is performed as such, the
common intention of the parties is clear and that should be the
end of the search. Should that not be enough, suffice it to add,
in the case at bar, that the circumstances in which the contract
was formed, the interpretation already given to it by the parties
and usage in the aeronautic industry all lead to the conclusion
that Mr. Wolf is in no position of subordination and that
Canadair is in no position of control. The 'central
question' was defined by Major, J. in Sagaz as being
'whether the person who has been engaged to perform the
services is performing them as a person in business on his own
account'. Clearly, in my view, Mr. Wolf is performing his
professional services as a person in business on his own
account.
In our day and age, when a worker decides to keep his
freedom to come in and out of a contract almost at will, when the
hiring person wants to have no liability towards a worker other
than the price of work and when the terms of the contract and its
performance reflect those intentions, the contract should
generally be characterised as a contract for services. If
specific factors have to be identified, I would name lack of job
security, disregard for employee-type benefits, freedom of choice
and mobility concerns.
[21] In his brief judgment - also concurring
in the result - Noël, J.A. considered the matter of
intention of the parties and his reasons are reproduced
below:
I too would allow the appeal. In my view, this is a
case where the characterization which the parties have placed on
their relationship ought to be given great weight. I acknowledge
that the manner in which parties choose to describe their
relationship is not usually determinative particularly where the
applicable legal tests point in the other direction. But in a
close case such as the present one, where the relevant factors
point in both directions with equal force, the parties'
contractual intent, and in particular their mutual understanding
of the relationship cannot be disregarded.
My assessment of the applicable legal tests to the
facts of this case is essentially the same as that of my
colleagues. I view their assessment of the control test, the
integration test and the ownership of tool tests as not being
conclusive either way. With respect to financial risk, I
respectfully agree with my colleagues that the appellant in
consideration for a higher pay gave up many of the benefits which
usually accrue to an employee including job security. However, I
also agree with the Tax Court Judge that the appellant was paid
for hours worked regardless of the results achieved and that in
that sense he bore no more risk than an ordinary employee. My
assessment of the total relationship of the parties yields no
clear result which is why I believe regard must be had to how the
parties viewed their relationship.
This is not a case where the parties labelled their
relationship in a certain way with a view of achieving a tax
benefit. No sham or window dressing of any sort is suggested. It
follows that the manner in which the parties viewed their
agreement must prevail unless they can be shown to have been
mistaken as to the true nature of their relationship. In this
respect, the evidence when assessed in the light of the relevant
legal tests is at best neutral. As the parties considered that
they were engaged in an independent contractor relationship and
as they acted in a manner that was consistent with this
relationship, I do not believe that it was open to the Tax Court
Judge to disregard their understanding (Compare Montreal v.
Montreal Locomotive Works Ltd., [1947] 1
D.L.R. 161 at 170).
[22] In the case of West Direct Express
Ltd. v. Canada (Minister of National Revenue -
M.N.R.), [2003] T.C.J. No. 373, Porter
D.J.T.C.C. decided a case involving an individual providing
courier services to the corporate market in Calgary. At paragraph
14 of his reasons, Judge Porter commented:
I am further mindful that as a result of the recent decisions
of the Federal Court of Appeal in Wolf v. Canada, [2002]
F.C.J. No. 375, and Precision Gutters Ltd. v. Canada (Minister
of National Revenue - M.N.R.), [2002] F.C.J. No. 771, a
considerable degree of latitude seems now to have been allowed to
creep into the jurisprudence enabling consultants to be engaged
in a manner in which they are not deemed to be employees as they
might formerly have been...
[23] After referring to the quotation of
Décary, J.A. in Wolf, supra, Judge Porter
continued:
Thus, it seems to this Court that the pendulum has started to
swing, so as to enable parties to govern their affairs more
easily in relation to consulting work and so that they may more
readily be able to categorize themselves, without interference by
the Courts or the Minister, as independent contractors rather
than employees working under contracts of service.
In conclusion, there is no set formula. All these factors bear
consideration and as Major J. said in the Sagaz case
(above), the weight of each will depend upon the particular facts
and circumstances of the case. Many of the tests can be quite
neutral and can apply equally to both types of situation. In such
case, serious consideration has to be given to the intent of the
parties. Thus is the task of the trial Judge.
[24] As outlined - at Note 1 - of the
Auditor's Report - Exhibit A- 4 - Hospital found itself in a
precarious situation. The operation of Hospital had been taken
over pursuant to an Order-in-Council under the Public Health
Act of Saskatchewan. A Board of Directors was established
later and - in 1996 - the provincial Minister of Municipal
Government transferred the net assets of Hospital to the Board
for no monetary consideration. In August, 1999, all the nurses
walked off the job and no replacements could be found who were
willing to provide their services in accordance with the usual
conditions applicable to an employer/employee relationship. The
CEO of Hospital was a retired professional administrator who
agreed to accept the challenge on a part-time basis while
residing in his own municipality of Lanigan and attending at
Uranium City from time to time, as required. The Director of
Finance was a Saskatoon accountant with his own practice. The
only permanent members of the medical staff and/or hospital
administration appear to be the three resident physicians.
Everyone else - including the Head Nurse - flew to Uranium City
and worked for two weeks at a time. Some attended more often than
others and Chisan was able to choose the periods when she was
available to provide her services. One should guard against the
temptation to use brute force - even if sanctioned by
longstanding tradition - in order to drive an irregular-shaped
peg into a round hole. In the within appeals, the indicia
referred to by Major, J. are inconclusive. However, in my view,
they favour a finding that the worker was an independent
contractor even in the absence of an agreement to that effect. On
the evidence, I cannot find any reason to displace the intention
of the parties - as disclosed by the terms of their contract - to
govern their own working relationship, particularly when reacting
to extreme difficulties arising from an unforeseen series of
events. A bustling, vibrant community of nearly 6,000 had been
reduced by the vagaries of a specialized resource economy to a
mere 150 hardy souls sharing a northern region populated by
another 3,400 persons living in or near several other small
remote villages accessible to southern urban centres only by air.
The residents of that region still required medical treatment to
the best level attainable under the circumstances. The solution
chosen by the provincial government and - later - administered by
the Board of Hospital was to utilize a business method whereby
nurses would provide their services on the basis they were not
employees but were in business on their own account for that
specific purpose. One does not have to be a specialist in
Saskatchewan politics to infer that the imprimatur of the nurses'
union - SUN - with respect to this method of retaining the
services of its members must have been based in large measure on
an appreciation of the unique situation in Uranium City and the
compelling need to provide nursing care to residents of that
region.
[25] The worker is an experienced nurse. She
earned income from nursing apart from her salary from employment.
One source was the insurance companies which retained her
services to provide medical examinations and another was Hospital
which paid for her professional services in accordance with the
terms of their contract. Chisan was prepared to sacrifice holiday
time or other earned days-off in exchange for the opportunity to
apply her skills in a remote municipality for a two-week
period at a rate of remuneration in excess of her usual salary
when calculated on a daily basis. I cannot find any reason to
conclude that the terms and conditions of the contract entered
into by the worker and the appellant were inconsistent with the
reality of their working relationship to the point where their
agreement should be rejected in favour of an alternate
characterization of working status supported only by weak and
inconclusive factors within the framework of a global
analysis.
[26] Both appeals are allowed. In each
instance, the decision of the Minister - dated October
23, 2001 - is varied to find:
- Joanne Chisan was not engaged in either insurable or
pensionable employment with Uranium City Hospital during the
periods from August 21 to September 4, 2000, October 30 to
November 13, 2000, January 30 to February 13, 2001 and April 30
to May 14, 2001 because she was providing her services as an
independent contractor.
Signed at Sidney, British Columbia, this 27th day of June
2003.
D.J.T.C.C.
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