MacEachern v. M.N.R., docket 97-2142-UI

Date: 19990607

Dockets: 97-2142-UI; 97-231-CPP

BETWEEN:

WILLIAM MacEACHERN,

Appellant,

and

THE MINISTER OF NATIONAL REVENUE,

Respondent.

Reasons for judgment

Cuddihy, D.J.T.C.C.

[1] These appeals were heard in Sydney, Nova Scotia, on May 3, 1999.

I- The appeals

[2] These are appeals from two decisions of the Minister of National Revenue (the "Minister") of September 26, 1997, where it was determined that the employment of the Appellant with Lingan Country Club (the "Payor"), from April 1 to September 14, 1996, was not insurable nor pensionable within the meanings of the Unemployment Insurance Act (the "old Act") now known as the Employment Insurance Act (the "new Act") and the Canada Pension Plan (the "Plan"), because, according to the Minister, the Appellant was not engaged by the Payor under a contract of service pursuant to subparagraph 3(1)(a) of the old Act, subparagraph 5(1)(a) of the new Act and paragraph 6(1)(a) and subsection 27(1) of the Plan.

II- The facts

[3] In rendering his decisions the Minister relied on the facts and reasons outlined in his Replies to the Notices of Appeal. For the purpose of this judgment, it will only be necessary to outline the facts in the Reply to the Notice of Appeal No: 97-2142(UI) and particularly in paragraph 6 as follows:

"(a) the payor was a golf and country club located in Sydney, Nova Scotia;

(b) the Appellant had been engaged by the Payor for a number of years prior to 1996;

(c) the Appellant was not hired by the Payor in 1996;

(d) the Appellant filed a wrongful dismissal action against the Payor;

(e) the Appellant and the Payor reached an out of court settlement that the Appellant would be paid the equivalent of 24 weeks of pay and the Payor was not required to rehire the Appellant;

(f) the Appellant withdrew his complaint to the Nova Scotia labour relations board once the settlement in (e) above was reached;

(g) the Appellant was paid the agreed upon amount by the Payor as damages in lieu of wages or salary;

(h) the Appellant performed no services for the Payor during the UI and EI periods in question;

(i) there was no contract of service between the Appellant and the Payor."

[4] The Appellant admitted the allegations in subparagraphs (a), (b), (d) and (h). As to subparagraph (c) the Appellant admitted that he was not hired by the Payor in 1996 because he was not called back to work. The Appellant admitted with explanations the allegations in subparagraphs (e) to (g). The Appellant denied subparagraph (i).

III- The evidence

[5] The Appellant was heard in support of his appeal. Exhibits A-1 to A-3 and J-1 to J-3 were filed in the Court record.

[6] In the fall of 1995 attempts were made by the Payor not to rehire the Appellant for the 1996 job season. The Appellant went to arbitration. The result of the arbitration hearing dated October 27, 1995 is contained in a document (Exhibit J-1) sent to the lawyers representing both parties which reads as follows:

"...

Gentlemen:

Re: Lingan Gold Club - Arbitration

This will confirm our attendance at an Arbitration Hearing scheduled on October 6, 1995. At the commencement of the Arbitration, Mr. Broderick on behalf of the employer offered no evidence on just cause for dismissal of the grievor, Mr. MacEachern. The consensus was that the Arbitration Board order that the grievance be allowed and the Grievor reinstated with no loss of benefits or seniority but that effectively he was placed on layoff as of that date, the 6th of October, 1995, with a compensation package containing necessary adjustments to be negotiated by counsel for the parties. If counsel wish any further written confirmation or decision, please advise.

..." (underlining mine)

[7] The Appellant was laid off on October 6, 1995 and applied and received unemployment insurance benefits up until they expired, some time in 1996. Also as a result of this dispute when the Appellant’s benefits ran out, he applied for welfare assistance.

[8] The Appellant was not called back to work on April 1, 1996, as he should have been.

[9] On November 12, 1996, the Appellant’s lawyer sent a letter (Exhibit J-2) to Mr. Gary Ross, the Chief Executive Officer of the Labour Relation Board of Nova Scotia which reads as follows:

"...

This confirms our earlier call of today. This matter has been settled amongst the parties. The settlement is for 24 weeks pay, at the guaranteed 44 hours per week, at his regular hourly rate plus all benefits ie vacation pay, pension and health and welfare, plus employer contributions to the Government of Canada for their portion of his UIC and CPP, netted by statutory deductions from the complainant for income tax, CPP and UIC. In exchange Mr. MacEachern will give a full release to the Lingan Employer for any and all actions, which he had, may have had, or now has, against the Lingan Golf Club employer for conduct arising out of his non-recall last spring to now. Mr. MacEachern will also sign a document acknowledging that the Lingan Golf Club has no further obligation to him, including but not limited to an obligation to recall him from layoff in the future. ..."

[10] The Appellant was to receive for his 1996 work period a settlement for 24 weeks of pay, at the guaranteed 44 hours per week at his regular hourly rate plus all benefits as stated in Exhibit J-2. The amount he should then have received was $17,510.59 as may be seen on the T4A and T4 slips for the 1996 taxation year remitted to the Appellant (Exhibit A-3).

[11] Sometime in December 1996 a release was signed by the Appellant (Exhibit A-1). This release for $1.00 bears no date and would have been signed by the Appellant. The Appellant said "that at the time my condition was such that I may have signed anything". It was just before Christmas and he was in receipt of welfare.

[12] On December 23, 1996, the Appellant was given a cheque from the Payor in the amount of $6,559.27 (Exhibit A-2).

[13] On January 17, 1997, the Payor through Bernadette Joseph prepared a record of employment (Exhibit J-3) and an undated attached letter signed by lawyer Charles Broderick which states as follows:

"...

TO WHOM IT MAY CONCERN

William MacEachern was not rehired at the Lingan Golf & Country Club. As a result a grievance was filed. After some time a settlement was reached between the parties. This separation slip is as a result of a settled grievance procedure between Mr. MacEachern and the Lingan Golf & Country Club. Mr. MacEachern received payment for the dates of April 1, 1996 to September 14, 1996 but did not work.

Trusting this will clarify our separation slip.

..."

[14] The Appellant some time in 1997 would have applied for unemployment insurance benefits as a result of this record of employment dated January 17, 1997. It appeared to the Court that he was seeking unemployment insurance benefits for the work period from April 1 to September 14, 1996 for which a settlement was to have been reached.

[15] This work period for 1996 could not normally qualify for unemployment insurance benefits since the amount of money the Appellant was supposed to receive, $17,510.59, would normally have been paid as a result of damages and not wages and no work was performed by the Appellant for the Payor from April 1 to September 14, 1996. The result being that, the said period of time could not qualify the Appellant to receive benefits for the normal lay off period in the fall of 1996 to the spring of 1997.

[16] The Appellant represented himself during this hearing. He gave a long explanation as to what took place.

[17] This hard working individual was very upset over the situation he has lived for the past three years. He has been in the work force for close to forty years and he genuinely expressed his point of view and explained in his own way that his understanding of the situation was that he would receive a settlement for the 1996 work period and also be eligible for unemployment insurance benefits as a result as if he had worked from April 1 to September 14, 1996.

[18] The Payor although duly informed did not appear or intervene as it was entitled to and, as a result, no additional information was supplied by the Payor to the Court. For instance it was not fully understood by the Appellant why the Payor would only have given him a cheque of $6,559.27 on the 23rd of December 1996. The Appellant said that on that day, close to Christmas, he was very upset, because he had been forced to go on welfare and would have signed and accepted anything. He was under the impression that his cheque in settlement should have been more than what he received (Exhibit A-2).

[19] The Court understood how a person such as the Appellant with limited education could be confused with the figures. It is not known to the Appellant as to how exactly the Payor went about arriving at the amount of $6,559.27 when the documents of the Payor show a sum of $17,510.59 as a retiring allowance (Exhibit A-3, form T4A, no: 03-389-461) and at the same time as employment income (Exhibit A-3, form T4, no: 59-533-308). It did appear that the Appellant was under the impression that he was to receive a settlement for the work period of April 1 to September 14, 1996 and also be eligible to receive unemployment insurance benefits in addition for 1996 or 1997 (Exhibit J-2). This is what appeared to be his argument when listening to him and looking at the exhibits as a whole.

[20] As stated before, the fact remains that the Appellant did not work for or receive wages from the Payor from April 1 to September 14, 1996 and whatever he should or did receive as a settlement could not be interpreted as insurable or pensionable employment.

[21] However the Court is not satisfied from listening to this man that he fully understands what happened to his settlement cheque. What was deducted from it? Why was it reduced? We see from the statement of employment insurance benefits (Exhibit A-3, form T4U) that the Appellant in 1996 received a total of $10,528.00. Was that amount or part of it deducted from the settlement by the Payor? Would the settlement, if it is to be deducted, be done so as of April 1, 1996, the date on which he should have been called back to work? Would the claimant not have been entitled to an extension of his benefit period? Was the Appellant reimbursed for Canada Pension Plan or Unemployment Insurance contributions which appear to have been deducted from his T4-1996? All these questions must be answered in all fairness to the Appellant by a representative of the Respondent, whom I trust will offer an adequate explanation to Mr. MacEachern and rectify his situation if necessary.

IV- Decision

[22] The work period from April 1 to September 14, 1996 is not insurable nor pensionable and as a consequence the appeal is dismissed saving for the Appellant the opportunity of obtaining from the Respondent, within a reasonable delay, an explanation to the questions set out in this judgment.

[23] The Court is well aware of the limited question it was asked to answer, however in view of the situation of this citizen it is my view that the request made by the Court to the Respondent would allow for a better understanding by the Appellant of his situation.

Signed at Dorval (Québec), this 7th day of June 1999.

"S. Cuddihy"

D.J.T.C.C.