Date: 20000614

Dockets: 1999-3685-CPP; 1999-3684-EI

BETWEEN:

ROMAN KOCUR,

Appellant,

and

THE MINISTER OF NATIONAL REVENUE,

Respondent.

Reasons for Judgment

Hamlyn, J.T.C.C.

[1] The Appellant, an ordained priest, appealed a ruling to the Respondent for the determination of the question of whether or not he was employed in insurable employment while engaged by Nipawan Melfort Wakaw Parish Committee Ukrainian Orthodox Church of Canada, formerly operating as Parish Committee, The Greek Orthodox Church of Canada (the “Payor”) for the period from January 1, 1998 to March 16, 1999, within the meaning of the Employment Insurance Act (the “Act”).

[2] By letter dated August 13, 1999, the Respondent informed the Appellant that it had been determined that his engagement with the Payor, during the period in question, was insurable employment for the reason that the Appellant was employed pursuant to a contract of service.

[3] The Appellant also appealed a ruling to the Respondent for the determination of the question of whether or not he was employed in pensionable employment while engaged by Nipawan Melfort Wakaw Parish Committee Ukrainian Orthodox Church of Canada, formerly operating as Parish Committee, The Greek Orthodox Church of Canada (the “Payor”) for the period from January 1, 1998 to March 16, 1999, within the meaning of the Canada Pension Plan (the “Plan”).

[4] By letter dated August 13, 1999, the Respondent informed the Appellant that it had been determined that his engagement with the Payor, during the period in question, was pensionable employment for the reason that the Appellant was employed pursuant to a contract of service.

[5] The Appellant then appealed both matters to this Court. In his Notice of Appeal he recited the following:

Revenue Canada has been provided ample evidence to clearly demonstrate that Father Roman Kocur is not under the employment of the Parish Committee, he is not controlled by the Parish Committee (in fact the opposite is the proper situation) and, he cannot be fired or terminated by the Parish Committee (in fact the opposite is the proper situation). This has been substantiated by the church dogmas, doctrine, by-laws and, practice. Despite this situation, Revenue Canada has deemed Father Roman Kocur as being employed by the Parish Committee which constitutes a flagrant disregard for the church structure and practice by Revenue Canada.

It is very clear, according to the Ukrainian Orthodox Church, that a Priest has full control of his congregation and is not to be employed (controlled) by the said congregation.

Father Roman Kocur, is an independent self-employed individual who received assistance from the Parish Committee as required by the church by-laws. According to the church by-laws and hierarchy Father Roman Kocur is superiorly above the Parish Committee.

Father Roman Kocur will present as evidence at trial the church by-laws, letters and, oral evidence to explain the church hierarchy, principles and, practice with respect to the relationship between the Priest and the Parish Committee.

The Appellant concludes:

The relationship between the Parish Committee and Father Roman Kocur, an Ukrainian Orthodox Priest, is not an employment relationship.

[6] In making his decision, the Respondent relied on the following assumptions of facts:

the Ukrainian Orthodox Church of Canada is involved in the preaching of religion;

the Payor is a body which administers twelve different parishes or congregations;

the Appellant is an ordained priest and was placed as a Minister in a congregation;

the Appellant’s duties included presiding at various services such as regular mass, weddings, funerals, baptisms, and various other related duties;

the Payor provided the Appellant with a dwelling or a manse, valued at $400.00 per month;

the Appellant was paid a salary of $2,100.00 per month;

the Appellant was also paid a monthly car allowance of $750.00;

the Appellant was paid an additional $150.00 per month allowance for office space, a telephone, office supplies and a computer;

the Appellant participated in a pension plan and a disability insurance provided by the Payor, to which the Appellant contributed at the rate of 50% of the costs;

the Appellant was entitled to two weeks paid vacations;

the Appellant was entitled to paid sick leave;

the hours for regular mass services were determined by the Payor, whereas the Appellant had some flexibility for the hours to schedule other services such as weddings and baptisms;

the content of sermons and regular services had to be within the guidelines of the Payor;

the Appellant was required by the Payor to attend mandatory quarterly and annual meetings;

the Payor required the Appellant to attend an annual retreat, the costs of which were borne by the Payor;

the Payor provided the required wine, robes, goblets sceptors and similar other supplies to the Appellant;

the Appellant did not take a vow of poverty;

the Payor would pay any person who had to replace the Appellant, if the Appellant could not perform the services;

the Payor is involved in the preaching of religion and the Appellant was placed as a Minister in a congregation, therefore the Appellant was an integral part of the Payor’s organisation;

the Appellant was employed by the Payor pursuant to a contract of service.

Legislation and Jurisprudence

Mr. Justice MacGuigan reviewed various tests applied by the Courts in distinghishing an entrepreneur from an employee: Wiebe Door Services Ltd. v. M.N.R., 87 DTC 5025. In his Reasons for Judgment, at page 5030, MacGuigan J. referred to the comments of Cooke J. in Market Investigations Ltd. v. Minister of Social Security, [1968] 3 All E.R. 732 at pages 738-739. Cooke J. stated:

“The observations of Lord Wright, of Denning L.J., and of the judges of the Supreme Court in the U.S.A. suggest that the fundamental test to be applied is this: “Is the person who has engaged himself to perform these services performing them as a person in business on his own account?” If the answer to that question is “yes”, then the contract is a contract for services. If the answer is “no” then the contract is a contract of service. No exhaustive list has been compiled and perhaps to exhaustive list can be compiled of considerations which are relevant in determining that question, nor can strict rules be laid down as to the relative weight which the various considerations should carry in particular cases. The most that can be said is that control will no doubt always have to be considered, although it can no longer be regarded as the sole determining factor; and that factors, which may be of importance, are such matters as whether the man performing the services provides his own equipment, whether he hires his own helpers, what degree of financial risk be taken, what degree of responsibility for investment and management he has, and whether and how far he has an opportunity of profiting from sound management in the performance of his task. The application of the general test may be easier in a case where the person who engages himself to perform the services does so in the course of an already established business of his own; but this factor is not decisive, and a person who engages himself to perform services for another may well be an independent contractor even though he has not entered into the contract in the course of an existing business carried on by him.”

[7] Subsection 6(c) of the Employment Insurance Regulations reads:

Employment in any of the following employments, unless it is excluded from insurable employment by any provision of these Regulations, is included in insurable employment:

. . .

(c) employment of a person as a member of the clergy or as a member of a religious order;

[8] The word “employment” in Canada v. Skyline Cabs (1982) Ltd., 70 N.R. 210 (F.C.A.) for the purposes of this subsection “is not to be understood in the narrower sense of a contract of service, ... but in the broader sense of ‘activity’ or ‘occupation’.”

[9] Historically, a person who held the position of a curate is the position of a person who holds ecclesiastical office and not the position of a person whose duties and rights are designed by a contract. Indeed, it was held that the duties of a curate were not defined by any contract of employment.[1]

[10] More recently, in NAC Foreigh Extension Inc. v. Canada (M.N.R.) [1992] T.C.J. No. 249, a decision under the Unemployment Insurance Act and the Canada Pension Plan Act, a religious organization engaged a foreign missionary worker. The worker was required to abide at all times with church orthodoxy. He was paid a per diem rate. The Tax Court of Canada held the missionary worker was fully integrated into the operations of the Appellant. The Appellant was at all times bound to adhere and promote the policies and doctrines of the Church. The missionary worker was engaged in insurable and pensionable employment.

The Evidence

[11] The Appellant was the only witness.

[12] The Appellant stated the church structure has not changed in the last 1500 years. From the Statute and By-Laws of the Ukrainian Orthodox Church of Canada (Exhibit A-3) the Appellant read the following excerpts to clarify the church hierarchy and the position of and the authority of a priest in relation to church structure.

. . . . .

2. The Ukrainian Orthodox Church of Canada preserves dogmatic unity with all Orthodox Autocephalous Churches; it is equal in rights with them and independent in its policy and administration, and leads its life on the basis of the Word of God, as written in Holy Scriptures, and Holy Tradition, concluded in the Canons and Decisions of the Seven Ecumenical Councils.

The Ukrainian Orthodox Church of Canada maintains the same position as all other Eastern Orthodox Churches, with regard to the canons and decisions of the Seven Ecumenical Councils, however, should a special canonical question arise, undetermined in the aforementioned rules and regulations, it shall be referred for analysis to and decision of the Synod of Bishops of the Ukrainian Orthodox Church of Canada, or, in the absence of such a Synod, the question should be referred to qualified specialists named for this purpose by the referring body, and after receiving their opinion, the Council or Consistory would make its decision.

. . . . .

91. For the spiritual care of Congregations, Missions or Parishes, Clergymen are assigned or transferred by the Primate in council with the Consistory. A Congregation, Mission or Parish may present its choice of candidates for Pastor (Parish Priest), and its request may be taken into consideration when assignments are made and where the candidate priest satisfies all other prerequisites set out for Parish Priests in this Statute and By-laws. Within a Diocese, transfers, and assignments are made with the understanding of the Diocesan Bishops.

92. The Pastor (Parish Priest), by virtue of his office, oversees Church discipline in the Congregation, Mission or Parish, and in general oversees that the moral life of the Congregation, Mission or Parish does not decline but continues to flourish.

93. The Pastor (Parish Priest) is the primary advisor to the Congregation, Mission or Parish in all Church matters, and, as such, has the right to be present at deliberations and Meetings of the Congregation, Mission or Parish, at the Meetings of its governing bodies, and to participate as their advisor.

94. Issues regarding rites, content of Divine Services and the spiritual discipline in the Congregation, Mission or Parish, shall be determined by the Pastor (Parish Priest), providing that in the event of disagreement, the decision is made by the Primate or the Diocesan Bishop.

. . . . .

96. The Pastor (Parish Priest), by virtue of his office, is obligated to look after the congregational and spiritual matters of the Congregation, Mission or Parish on which the development and the welfare of such Congregation, Mission or Parish depends. The Pastor (Parish Priest) oversees the proper education of children in matters of Faith, and the religious upbringing of the youth.

97. The Pastor (Parish Priest) shall, through his Bishop, present to the Consistory an annual or a more frequent report, if requested, respecting the status of the Congregation, Mission or Parish and respecting his own activities.

[13] The Appellant was appointed by his bishop to the Nipawan Melfort Wakaw Parish Committee Ukrainian Orthodox Church of Canada.[2] His specific assignment was to “run the Church” in the geographical designated area. The Appellant stated the parish committee operates under his control and the committee members are members of the congregation. He receives in total remuneration $41,000 per year. If he requires more remuneration he stated it is within his jurisdiction to dictate and receive from the committee further funds. He said when and how collections of monies are taken from the congregation is under his direction.

[14] On cross-examination he confirmed the committee is of the opinion they are the employers of the priest. However, he asserted from the church’s statutes and by-laws and from a historical point of view the committee is subservient to the priest and carries out the administrative directions of the priest.

[15] The power to establish, continue or abolish the parish committee is in the hands of the Appellant as he is the priest designated and appointed by the bishop to run the parish.

Analysis

[16] The issue before the Court is whether Reverend Father Kocur has engaged himself to perform the services of parish priest as a person doing the services of parish priest on his own account or on the account of the parish.

[17] The subject church is a self-governing ecclesiastical organization of Ukrainian Orthodox Christians. The Appellant is an ordained priest of the church. A priest is appointed and assigned to the parish by the bishop. The priest reports to the bishop. A priest within the church professes and follows the faith, doctrine and dogma established by the church. These professions, doctrines and dogmas are the fundamental controls on the activities of a priest. Primarily, the bishop on behalf of the church exercises the hierarchical control over the priest on behalf of the church.

[18] The particular parish committee was established by a predecessor priest and this committee assists the Appellant priest in the administration of a parish. The parish committee while technically a committee subservient to the priest sees itself as the employer of the priest in the parish. The Appellant also confirmed from his point of view, to abolish the committee in the area he is assigned to makes no practical sense as the committee is necessary in the administration of such a large area.

[19] As for the priest’s remuneration, the parish provides funds through various means of collection and fund-raising. This remuneration includes a monthly payment as well as housing, a car allowance, allowances for office space, telephone and office supplies. The Appellant also participates in a pension plan and a disability insurance plan, paid for in part out of parish funds.[3]

[20] The parish also provides the requisite robes, goblets, sceptors and similar supplies to the Appellant.

Conclusion

[21] The Court concludes that the Appellant was engaged as an ordained priest in the Ukrainian Orthodox Church of Canada appointed and assigned by his bishop to a geographical area to do the work of the church in accordance with the profession of faith, doctrine and dogmas of the church. The Nipawan Melfort Wakaw Parish Committee of the Ukrainian Orthodox Church of Canada assists the Appellant in his administration of the parish. While technically subservient to the Appellant in terms of church hierarchy and while not part of the consistory of the church, the committee members see themselves as the employers of the Appellant. The committee, as is the priest, are fully integrated into the activities and practical administrative organization of the parish.

[22] The Appellant, in the exercise of his ordained duties assigned does not stand alone, he is part of the church. The committee in the exercise of their administrative duties also do not stand alone. They are part of the church and they, in their administrative duties see that the priest on behalf of the parish in the geographical area is looked after and remunerated.

[23] Thus while the Appellant is the administrative head of the parish, the committee represents the parish as the employer that remunerates the Appellant in the work of the church.

[24] From these findings I further conclude. The Appellant in the narrower sense of the analysis criteria to be examined as set forth in Wiebe Door Services Ltd. v. M.N.R., 70 N.R. 214 (F.C.A.) is under a contract of service and in a broader sense as defined in the Employment Insurance Regulations is in an employer employee relationship.

[25] I conclude the Appellant appointed and assigned by the bishop to the Nipawan Melfort Wakaw parish area was therefore engaged by the parish represented by Nipawan Melfort Wakaw Parish Committee in insurable employment and pensionable employment.

Decision

[25] The appeal is dismissed.

Signed at Ottawa, Canada, this 14^th day of June, 2000.

"D. Hamlyn"

J.T.C.C.

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