Campbell v. M.N.R., docket 97-739-UI

Date: 19990114

Docket: 97-739-UI

BETWEEN:

STUART CAMPBELL,

Appellant,

and

THE MINISTER OF NATIONAL REVENUE,

Respondent,

and

JOHN (JACK) A. ANDERSON,

Intervenor.

Appeal heard on December 16, 1998 at Toronto, Ontario, by the Honourable Deputy Judge W.E. MacLatchy

Reasons for judgment

MacLatchy, D.J.T.C.C.

[1] This appeal was heard at Toronto, Ontario, on December 16, 1998.

[2] The Appellant applied to the Respondent for the determination of the question of whether or not John (Jack) A. Anderson, the Worker, was employed in insurable employment while engaged by him for the period from July 18, 1994 to December 21, 1995 within the meaning of the Unemployment Insurance Act (the "Act").

[3] The Respondent informed the Appellant that it had been determined that the Worker's engagement during the period in question was insurable employment for the reason that the Worker was not the registered owner of the vehicle and did not operate the business.

[4] It was agreed by all parties that the taxi plate no. 472 was issued to the Appellant by the Corporation of the City of London and that it was a probationary plate and could not be transferred or leased according to the licensing rules of the city of London. The taxi cab vehicle was registered under the name of the Appellant and he was operating a taxi business within the meaning of paragraph 12(e) of the Unemployment Insurance Regulations. The Worker earned his living by driving the Appellant's taxi cab vehicle and was not licensed by the city of London to conduct or operate a taxi cab business.

[5] The Appellant gave his evidence with great candour. He admitted the following facts:

- that he was the registered owner of the probationary license no. 472;

- according to the licensing rules of the City of London he could not lease or transfer the taxi plate during the probationary period;

- notwithstanding the said rules, he did lease, by verbal agreement, not only the taxi plate to the Worker, but the vehicle owned by him and used as the taxi, the taxi meter and the two-way radio for communication with the dispatch office service;

- the Appellant signed his vehicle registration in blank and gave it to the Worker; both parties acknowledged that they could not legally register the transfer of the vehicle because it would invalidate the taxi plate according to the rules of the City of London.

- the vehicle was insured by the Worker which was contrary to the said rules;

- the Worker was responsible for maintenance of the vehicle and for the cost of the taxi dispatch service;

- the Appellant wanted the taxi license to continue and have the taxi on the road until the probationary period expired which apparently was December 31, 1995, when the license would be owned outright by the Appellant;

- the Appellant further knew that the taxi vehicle would not be able to be used in 1996 with the license as the rules specified that a vehicle more than eight years of age could not be used as a taxi with a City of London plate: the vehicle was a 1988 model;

- the Appellant was convinced to retire to Antigua in the West Indies and would be unable to drive the taxi himself;

- the Appellant designated the Worker as his agent to deal with the plate for the period November 13, 1995 and ending March 31, 1996, it being understood that the Worker would pay the annual fee to the City to keep the plate in good standing until 1996 when the probationary period expired.

[6] By reason of misadventure, mistake or disregard of the rules, the annual fee was not paid, the license was suspended and the Worker could not drive the vehicle as a taxi.

[7] The Appellant was upset by these circumstances and advised the dispatch company to stop servicing the taxi; the Worker was unable to be dispatched for any fare and was effectively deprived of his livelihood in the taxi business.

[8] Although, not germane to the issues involved in this hearing, it was disclosed that the Appellant did finally receive a taxi license plate that was his own property and which he subsequently sold and the Worker was able to continue as a taxi driver in the City of London early in 1996.

[9] Paragraph 12(e) of the Unemployment Insurance Regulations states:

"12. Employment in any of the following employments, unless it is excepted employment under subsection 3(2) of the Act or excepted from insurable employment by any other provision of these Regulations, is included in insurable employment:

...

(e) employment of a person as a driver of any taxi, commercial bus, school bus or any other vehicle that is used by a business or public authority for carrying passengers, where that person is not the owner of the vehicle or the proprietor or operator of the business or public authority;"

[10] This clearly fits the circumstances in this case. The Worker was a driver of a taxi and was not the owner or operator of the business. But then who was the owner? The facts alleged by the Appellant were in support of his contention that although he was the legitimate owner of the plate and the vehicle, he had transferred these items to the Worker "under the table". He stated that this was the way business was handled in the taxi trade. To the outside world or the unsophisticated citizens of the City of London, the Appellant was still the owner of the business. This Court makes a finding that the Appellant was the owner and operator of the taxi business and was unconvinced that ownership had been transferred to the Worker. It was a convenience to the Appellant that his plate be continued until the probationary period expired and that his older model taxi be used until 1996 when it would become too old to be used as a taxi according to the by-laws of the City of London.

[11] The Appellant resided in Antigua and he wanted little or no responsibility for these items while out of Canada. This sophisticated scheme devised by the Appellant would meet his immediate needs. He needed his plate and taxi in use until 1996. This scheme would accomplish these purposes.

[12] This finding is supported in law as in 715341 Ontario Ltd. v. M.N.R. [1993] F.C.J. no. 1064 and further amplified by the Federal Court of Appeal in Attorney General v. Skyline Cabs (1982) Ltd. [1986] F.C.J. no. 335.

[13] Paragraph 17.1 of the Unemployment Insurance Regulations (Collection of premiums) reads:

"The owner, proprietor or operator of a business or public authority that employs a person in employment described in paragraph 12(e) of the Unemployment Insurance Regulations shall, for the purposes of maintaining records, calculating insurable earnings and paying premiums under the Act and these Regulations, be deemed to be the employer of every such person whose employment is included in insurable employment by virtue of that paragraph."

[14] It follows that the Appellant is the proper person to be assessed and is responsible for deducting and remitting unemployment premiums. The driver is not an independent contractor in these circumstances.

[15] The appeal is dismissed and the Minister's decision is confirmed.

Signed at Toronto, Ontario, this 14th day of January 1999.

"W.E. MacLatchy"

D.J.T.C.C.