Citation: 2014 TCC 257
Date: 20140825
Dockets: 2009-1951(EI)
2009-2146(EI)
2009-2147(CPP)
BETWEEN:
GUY LANGLOIS,
Appellant,
and
THE MINISTER OF NATIONAL REVENUE,
Respondent.
[OFFICIAL ENGLISH
TRANSLATION]
REASONS FOR JUDGMENT
Tardif J.
[1]
The appellant appeals
from two determinations whereby the work performed by him was ruled not to be insurable
employment. The work in issue was performed on behalf of and for the benefit of
two different employers, R. Bossé & Fils Inc. and 6302629 Canada
Inc.
[2]
The periods in question
are, first, from September 20, 2004, to November 20, 2004, for docket 2009-1951(EI),
and, second, from July 4, 2005, to October 15, 2005, for docket 2009-2146(EI)
within the meaning of the Employment Insurance Act (EIA) and docket 2009‑2147(CPP)
within the meaning of paragraph 6(1)(a) of the Canada Pension
Plan (CPP).
[3]
The appellant also
appeals from a decision with respect to his pension entitlement under section 2
and paragraph 6(1)(a) of the CPP. Since it is a matter that may or may
not be directly related to the insurability of the work in issue, the parties have
agreed to consolidate this appeal with the two cases specifically involving the
insurability of the work in question. Thus, the outcome of the appeal in docket
2009‑2147(CPP) rests on the decision in dockets 2009‑1951(EI) and 2009‑2146(EI).
[4]
In such a context, the parties
agreed to proceed on common evidence for all three dockets.
[5]
The appellant explained
and described his forestry skills and abilities and his forestry technician diploma.
[6]
He explained and
described the type of work he had performed on behalf of the two employers
who prepared the Records of Employment for the periods of work in issue.
[7]
Highly qualified in
forestry both in theory and practice, the appellant was fully qualified to
assess the value of woodlots. He had the expertise and experience to monitor selective
logging, including the planning required for cutting, collecting and hauling
wood.
[8]
In other words, the
appellant had sufficient and adequate forestry expertise to monitor and supervise
the performance of said work, the environmental requirements of which are numerous
and strict. He also had the knowledge and experience to address serious
shortcomings, and even the irresponsibility of companies who retained his services
and issued the Records of Employment in issue.
[9]
The appellant explained
that the companies who issued the Records of Employment in issue had a number
of issues with regional county municipalities (RMCs) responsible for environmental
protection regulations.
[10]
The appellant also explained
that the executives of these same companies had very limited knowledge of forestry.
He indicated that work involving the cutting and hauling of selective wood was
generally performed by subcontractors who had and used their own equipment to
perform the work.
[11]
First, the appellant’s
work mainly consisted in meeting and holding discussions with woodlot owners; he
walked through woodlots and assessed the value of the woodlot that could be selectively
logged based on quality and quantity.
[12]
He also assessed the nature
of potential issues, determined constraints such as the bearing quality of wet
or dry soil and access; he took into account proximity to streams, wetlands, ground
elevations, etc.
[13]
Following site visits, the
assessment of the woodlot, conditions and constraints for hauling the cut wood,
he submitted a report to the company who made an offer to the owner and/or
manager of the woodlot.
[14]
The appellant was not
party to the negotiations and did not know the nature of the offer between the
owners and/or managers of the woodlots and the companies who issued the Records
of Employment. He was essentially informed of the outcome.
[15]
Second, if a transaction
was completed, he was notified, and he would then go to the sites to ensure
that the work was performed according to standards while complying with environmental
regulations.
[16]
To confirm and validate
his claims, the appellant called two witnesses, one as the owner, and the other
as duly appointed manager, who testified that they had indeed seen the appellant,
on a number of occasions, on the lands that were selectively logged. In
addition, the appellant filed, with the consent of the respondent, affidavits in
support of his evidence.
[17]
The appellant focused almost
all of his efforts and energies on demonstrating that he had worked as if it
was all that was required to succeed.
[18]
There is no doubt that the
appellant did perform work for companies he described as his employers. However,
is the relationship between him and these alleged employers the one he would
like the Court to accept?
[19]
As for the periods of
work where work hours were allegedly performed, the evidence is rather circumstantial;
this evidence consists mainly of the testimonies of Messrs. Lajule and Horth, along
with the content of the affidavits. These two witnesses essentially reported
having seen the appellant occasionally at the site located on the lands they
were responsible for. These testimonies simply validate the obviousness of the occasional
performance of the work performed by the appellant.
[20]
In Jacques Francoeur’s affidavit,
he states that he saw the appellant every day from July 4, 2005, to October 15,
2005. However, the rest is vague, if not a bit confusing.
[21]
In this case, precision
rather discredits the reliability of the information; indeed, the most important
element, i.e., the duration of the work, is very precise and unequivocal; everything
else is vague and uncertain.
[22]
Regarding the evidence
of the appellant’s presence on the sites, the content of the affidavit signed
by Danny Hudon is somewhat telling about the total lack of credibility of the appellant’s
testimony regarding his continuous presence on the sites. I refer in particular
to the work schedule of Mr. Hudon, who states in his affidavit that he worked seven
consecutive days per week every two weeks.
[23]
In response to a
specific question from the Court, as to whether Mr. Hudon, the affiant, was
continuously present on the worksite, the appellant replied that Mr. Hudon
was indeed always there except weekends.
[24]
The affiant states as
follows at paragraph 11:
[Translation]
I worked with another
team, we shared the work so I was on the site for seven days and then on leave
for the same length of time as I was replaced by another team, and so forth.
[25]
If Mr. Hudon had been as
present as he says, there is no doubt that he would have developed, maybe not a
friendship, but most certainly a relationship with the appellant that would
have allowed the appellant to know and remember that Mr. Hudon’s work
schedule was very different from what he stated. This is a very important factor
when assessing credibility.
[26]
This factor was further
supplemented by the appellant’s responses during the various interrogations
conducted by investigators and the responses given, from his home, to questionnaires
that he himself filled out, more specifically with respect to the various
places where he worked.
[27]
The appellant’s
incomplete evidence does not make it possible to conclude that the work in question
was performed under a contract of service. Indeed, the appellant’s explanations
are that remuneration negotiations were conducted as among equals. Moreover, the
parties to the contract needed each other: the forestry businesses to continue their
activities, and the appellant to qualify for employment insurance benefits.
[28]
In light of the facts relied
upon to explain and justify the determinations, namely, that the work was not
insurable employment, the appellant certainly had to emphasize the work
component.
[29]
The appellant’s
evidence described at length the work performed, all of which undoubtedly stems
from paragraph (r) in all three dockets 2009-2146(EI), 2009‑1951(EI) and
2009-2147(CPP) of the Replies to the Notices of Appeal, which states as follows
[Translation]: “during the period at issue, the appellant did
not perform any services for the payer.”
[30]
Indeed, upon reading
the allegations in the Replies to the Notices of Appeal, clearly written in the
context of a huge fraud involving fictitious Records of Employment, it is
apparent that the appellant had to emphasize the [Translation]
“work
performed” component given
that, in a large number of cases, they were essentially convenience Records of
Employment.
[31]
To prevent the
appellant from being deprived or penalized by the very general content of the
allegations in the Notices of Appeal, I often intervened to ensure the debate was
limited to the following fundamental question: was it insurable employment?
[32]
Despite the reminders, the
appellant did not provide any evidence of any relationship of subordination. Remuneration
paid as salary, the performance of work and the occasional presence on the site
are very important elements in an employment relationship.
[33]
However, they are not sufficient
to conclude that a contract of service existed; these are equally essential characteristics
in a contract of enterprise.
[34]
The distinction between
the two contracts is the existence of a relationship of subordination where one
party has authority over the other, the power of control and the ability to
monitor, intervene and sanction the work performed by the other party.
[35]
In contrast, the
contract of enterprise assumes that the parties to the contract negotiated make
transactions and communicate as equals and the work is rather assessed in terms
of expectations and results.
[36]
In the case at bar, the
work was performed, but I am satisfied that it was performed at the appellant’s
convenience and availability. One thing is for sure, the evidence is totally insufficient
to conclude that the work was performed as described in the Records of
Employment in issue.
[37]
It is difficult to demonstrate
the existence of a relationship of subordination without the presence of both parties
to the contract. However, the appellant’s explanations for the absence of his
alleged employers and/or co-workers are not persuasive.
[38]
Indeed, he stated that
he preferred to stay away from potentially dangerous persons, even though,
based on his language and certain observations, he seemed to have had rather
friendly relations with these persons.
[39]
In such circumstances, I
think instead that their absence was motivated by the very real fear that the
persons in question would validate the respondent’s hypothesis through their
explanations about their relationship with the appellant.
[40]
In the case at bar, there
is no relationship of subordination between the two parties. The appellant’s mandate
was one of result. To achieve this result, the appellant had complete latitude
and freedom and was not subject to any authority. In other words, the evidence
submitted does not make it possible to conclude that a contract of service
existed.
[41]
Of course, this is an
interpretation based on the evidence presented. However, it is an interpretation
validated by a number of elements that make it probative.
[42]
I refer in particular to
the following elements:
• absence of representatives from both
companies,
• the nature of the work,
• circumstance surrounding the setting of remuneration,
• presence on the work site,
• the appellant himself had a business,
• incomplete but telling explanations of the
content of Mr. Hudon’s affidavit,
•
the absolute necessity for
the companies to retain the appellant’s services.
[43]
The appellant’s work
was performed on behalf and for the benefit of two companies with apparently no
regard for or knowledge of environmental regulation.
[44]
The companies in
question were known as offenders, having no concern for the requirements
regarding the respect for and protection of the environment.
[45]
The companies in question
were so irresponsible that they would have clearly had to leave the area had it
not been for the arrival of the appellant, who, through his knowledge,
qualifications and reputation, essentially accredited the companies in question
with the authorities, including the RMCs.
[46]
The appellant explained
that he sought remuneration that corresponded to the maximum insurable amount, which
he was granted. At first, he stated that he walked through woodlots likely to
be cut to assess the quality and quantity of the wood. He also estimated possible
constraints for hauling wood from the forest. In that regard, he delineated appropriate
locations for a road to allow wood to always be hauled in accordance with environmental
statutes and regulations.
[47]
All of the appellant’s
explanations were very general and unclear except for the locations, which were
also validated and confirmed by two individuals who owned and/or were responsible
for the sites where logging was carried out.
[48]
A description of the
work performed and the actual days on which the work was performed was provided
in very general terms, a bit confusing and unclear about the work. One thing is
for sure, on the balance of probabilities, one cannot conclude that the
appellant worked the number of hours and during the periods mentioned in the
Records of Employment, the fundamental object of the two insurability cases.
[49]
The appellant referred
to “Pierre” when speaking about Pierre Bossé during
his testimony, demonstrating that he knew him very well. He stated that Mr. Bossé
had little or no knowledge of the forestry industry and had acquired a very bad
reputation to the point where authorities had to initiate legal proceedings to end
the forest massacre.
[50]
He therefore needed the
appellant who assessed and estimated the inventories of wood that could be harvested.
He delineated territories targeted by cutting and described the quality of the
wood, soil, thereby making it possible to anticipate constraints and
requirements in terms of equipment and machinery to haul the wood to be cut on
the various sites.
[51]
The appellant’s evidence
revealed one important element likely to validate his claims; it is his bank
statement showing that the payroll deposits were consistent with the Records of
Employment. While it is clearly a relevant element, it is certainly not
determinative in proving the existence of a relationship of subordination; this
was no doubt a mere agreement on the terms of payment.
[52]
The employer and/or author
of the Records of Employment did not testify.
[53]
For his part, the
respondent noted that the two employers in question had been the subject of a
major investigation which unequivocally revealed, inter alia, the facts
described in paragraphs 8(d) and (e) in docket 2009-1951(EI) and 7(k) and (l) in
dockets 2009-2146(EI) and 2009‑2147(CPP) of the Replies to the Notices of
Appeal:
(d)/(k) the payer was part of a group of corporations that was the subject
of a major investigation by the Employment Insurance Commission;
(e)/(l) the major investigation showed
that these corporations, including the payer, were involved in schemes, with
individuals such as the appellant, designed to provide the individuals with
false Records of Employment so that they could qualify for Employment Insurance
benefits to which they were not entitled;
[54]
The burden of proof is
on the appellant. He chose not to involve the two employers, one of whom he
knew particularly well as, during his testimony, he constantly referred to “Pierre” when speaking about Mr. Bossé. It would
have been important for Mr. Bossé to come validate, confirm and corroborate the
various facts recounted by the appellant. The appellant’s evidence is essentially
circumstantial.
[55]
There is no doubt that
the appellant did perform work for R. Bossé & Fils Inc. and 6302629 Canada
Inc.
[56]
However, although the
evidence established the performance of work by the appellant, does this mean
that the work was performed under a contract of service?
[57]
The answer is obviously
no because the work was clearly performed under a contract of enterprise for an
amount reflecting the payments established in such a way as to create a presumption
of sorts that it was a contract of service; the appellant was rather an
entrepreneur or self-employed person.
[58]
This is a case in which
the contract of enterprise was disguised as a contract of service. For employment
insurance purposes, form is certainly important, but substance is equally
important and must be aligned with form.
[59]
During the preparation
of his case, the appellant knew and was clearly aware of the facts and circumstances
behind the decision that is the subject of his three appeals.
[60]
Despite this reality, the
appellant chose to submit fairly general and unclear evidence regarding
essential elements. He mentioned that the salary claimed was based on the
maximum insurable amount for the period of time required to qualify for
employment insurance benefits and the CPP.
[61]
The appellant also
chose not to have the two employers in question testify, knowing full well they
were unscrupulous in providing, selling or falsifying a number of Records of
Employment. This reality should have ensured that he neither overlook nor omit certain
evidence.
[62]
In light of the
evidence submitted, by both parties, the mainly circumstantial evidence of the
appellant does not make it possible to conclude by a preponderance of the
evidence that the agreement on the work that was indeed performed was under a contract
of service.
[63]
For these reasons, the
appellant’s appeals under the EIA and the CPP are dismissed.
Signed at Ottawa, Canada, this 25th day of August 2014.
“Alain Tardif”
Translation certified true
on this 3rd day of March 2016
Daniela Guglietta,
Translator
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