REASONS
FOR JUDGMENT
Campbell J.
[1]
This appeal concerns the sad saga of two
individuals who had been friends since the mid-1980s but parted ways in 2012
when they had a falling out over property transfers and employment issues. They
continue to live on adjacent properties although the face-to-face meeting, at
the hearing of this appeal, was the first time in several years that they had
any interaction.
[2]
This is an unusual employment insurance case. Even
after hearing at length from both the Appellant and Randy Dawe, the owner of
Maple Leaf Oil Distributors Limited ("the payor"), I am still
uncertain of what exactly occurred between these two individuals. I am certain,
however, that the truth lies somewhere in that grey area between the two stories
that each of them related in Court.
[3]
The Respondent determined that the Appellant was
not engaged in insurable employment with the payor within the meaning of
paragraph 5(1)(a) of the Employment Insurance Act (the "Act")
for the period January 2, 2012 to March 9, 2012 ("the period"). The
payor was not an intervenor in this appeal. Mr. Dawe appeared as a witness for
the Respondent, after he was subpoenaed.
The Evidence of the Appellant, Lewis Parsons
[4]
Mr. Parsons and Mr. Dawe entered into a real
estate deal in June, 2011 in which Mr. Parsons agreed to sell to Mr. Dawe a
corner lot from the larger parcel of land that he owned. Mr. Dawe built a house
on this corner lot and this is where he resides today. The purchase price was
$20,000 for the land. Mr. Parsons contends that he worked for Randy Dawe,
the owner of the corporate payor. The payor also owned the Silverwood Inn Motel
in Bay Roberts, Newfoundland. Mr. Parsons testified that he and Mr. Dawe
had a verbal agreement in which the Appellant performed painting and other odd
jobs at the hotel based on a forty-five hour week at the rate of $13 per hour.
[5]
According to Mr. Parsons, part of the agreement
to sell a lot of land to Mr. Dawe was that it would be in exchange for Mr. Dawe
employing him during the period under appeal. Their payment method was novel.
Mr. Dawe gave the Appellant his personal credit card and, according to his
evidence on cross‑examination, he had permission to use the card in
whatever manner he wanted to. Mr. Parsons used the card to make purchases, for
example televisions sets, on behalf of the payor for the hotel and also used
this card to purchase building materials for a building he was erecting on his
own property which was adjacent to the land he agreed to sell to Mr. Dawe. The
evidence also indicated that Mr. Dawe used this same credit card to make
purchases for the house he was in the process of building on the land that he
was purchasing from the Appellant. At the end of the month, when the
statements arrived, they apparently sorted out which of the purchases each was
responsible for and Mr. Dawe would get credit against the $20,000 purchase
price that he owed the Appellant for the land. Mr. Parsons stated that at
the end of the day he received between $9,000 to $10,000 in cash against the
purchase price with the balance being credited in respect to the monetary
amount of the building materials that Mr. Parsons had purchased for his
own use on Mr. Dawe's credit card. He testified that there were no pay stubs
and that he did not receive a record of employment from the payor. The
Appellant testified that his work schedule was flexible because he could work
whenever he wanted to. He never tracked his hours in writing. He had
personal knowledge that deductions were made in respect to his wages because he
took them to the bank himself and returned the stamped bank documents to Mr. Dawe.
According to the Appellant, these two individuals discussed a second property
purchase subsequent to the period under appeal in which Mr. Dawe would purchase
a second lot adjacent to the first one that he bought from the Appellant.
However, this deal never materialized.
The Evidence of Randy Dawe
[6]
The payor, during the period, performed
bookkeeping for a small number of people, as well as some construction work and
also operated the Silverwood Inn Motel. These two individuals had been friends
for many years. Mr. Dawe wanted to build a house. They entered into an
Agreement of Purchase and Sale (Exhibit R‑3) dated June 23, 2011. Mr.
Dawe did not have the cash of $20,000 to purchase the land from Mr. Parsons.
Mr. Parsons agreed that Mr. Dawe could pay the purchase price partly by cash
payments and partly by supplying Mr. Parsons with some of the building
materials for a house that he was also erecting on his property.
[7]
Mr. Dawe confirmed in his testimony that the
evidence given by the Appellant respecting the use of the credit card was
correct. He also stated that the Appellant did not abuse the use of his credit
card. He did not agree, however, with the Appellant's evidence that the
purchase of this land was conditional upon Mr. Dawe employing the
Appellant. An Addendum dated October 3, 2011 to the Agreement of Purchase and Sale dated June 23, 2011 was entered as Exhibit R‑4. Between June, 2011 and October,
2011, each individual continued to build homes and were back and forth as
usual. Mr. Dawe testified that the Appellant continued to use his credit card.
Sometime after October, the Appellant returned the card to Mr. Dawe and went to
Ontario, returning in early January, 2012. Mr. Dawe then returned the
credit card to the Appellant for a second time because he did not have the
balance of the cash to pay the Appellant for the land. However, he then went on
to state that he felt that in early January, 2012 he had paid all of the
$20,000 for the property either by cash or through the credit card purchases
made by the Appellant. When he requested that the Appellant return the credit
card, Mr. Parsons did so. However a few days later, the Appellant indicated
that he had a few more purchases to make and that he would like to use the card
again. When asked why he would return the card again to the Appellant to use
when he felt that the $20,000 had been paid, he stated that the two were still
friends and that they had agreed to share the rebate on the materials, even
though Mr. Dawe did not think that the Appellant was entitled to any of the
rebate. The card was apparently returned to Mr. Dawe for a 10-day period, in
which the Appellant made two more purchases for himself.
[8]
In late September or early October, 2011, Mr.
Dawe testified that the Appellant initiated talk of selling a second lot of
land to him and indicated that he would give Mr. Dawe a "good deal". Mr.
Dawe's evidence was that he told the Appellant that he needed help finishing
his house and that if he actually performed work for him/his company and
accepted a cheque, he would purchase this second property although he was not
really interested in it. They never got to the point in their discussions of
pinpointing a purchase price. Mr. Dawe stated that they were never able to come
to an agreement on this employment arrangement. Mr. Dawe's evidence is that
until January 22, 2012, the Appellant never worked for him and that he hired
someone else to help him with the house that he was building. He then went on to
state that the Appellant did in fact work for him for 7 to 10 days in the first
part of February, 2012. He testified that this would have been insurable
employment time but that it was subsequent to the period under appeal. He stated
that the Appellant owed him money due to the additional two purchases that the
Appellant made on the credit card in January, 2012.
Analysis
[9]
What, if any, conclusions can I make based on
the evidence before me? I have two long-term friends who live next door to
each other but are now no longer on speaking terms. They did make an agreement
concerning the property purchase by Mr. Dawe for $20,000 as evidenced by the
Agreement of Purchase and Sale and the Addendum. They were both building houses
next to each other during this timeframe. They had an unusual method for the
payment of the purchase price, involving the use of Mr. Dawe's credit card,
which enabled the Appellant to purchase building materials for his own house
and Mr. Dawe to off‑set those amounts against the $20,000 which he owed
the Appellant. There were discussions and maybe a deal struck concerning Mr.
Dawe employing the Appellant to assist him with handyman work at the hotel and
building Mr. Dawe's house. Whatever the arrangement was, it soured to the
extent that the Appellant has refused to execute a deed of conveyance to the
property upon which Mr. Dawe built his house and this is now the subject of
separate litigation in the Newfoundland courts.
[10]
Their recollection, of what occurred between
them in respect to an employment arrangement, was so dissimilar that one
questions whether they were recalling the same period of time. The Appellant is
adamant that they reached a verbal agreement, respecting the period under
appeal, in which Mr. Dawe employed him as a handyman for approximately 40 to 45
hours weekly at a rate of $13 per hour. He thought he was delivering his
deductions to the bank periodically and returned stamped bank documents to Mr.
Dawe. On the other hand, Mr. Dawe claims that there never were any discussions
between them concerning employment in respect to the period under appeal. He
admitted that amounts for deductions were taken to the bank by the Appellant
but that the amounts related to Mr. Dawe's employment with the payor. I
question, however, why the Appellant was completing this task unless he was
doing handyman tasks for Mr. Dawe. I have no evidence, either oral or
documentary, that supports that any amount was actually paid to the Appellant
as wages. There were no cancelled cheques, no record of employment and nothing
in the credit card statements that suggest wages were paid. Nor do I have anything
concrete in the evidence before me that would permit me to conclude that work
was performed. Work may have been performed but it is just as plausible that it
may not have been. It may also be that it was an artificial arrangement as the
Respondent assumed in the Reply. Mr. Dawe's evidence was that any
potential employment occurred only when the Appellant offered to sell him the
second piece of property but that the Appellant never showed up for work
although he expected a pay cheque. In any event, this is subsequent to the
period under appeal. I have such contradictory evidence before me that I cannot
draw conclusions. The evidence of each witness was so tainted with the
emotional past history and breakdown of a friendship over a period of several years,
that I do not accept either witnesses' version of events as completely
credible. Somewhere between their stories, the truth remains buried. Although
it was not raised during the hearing, I suspect the root of many of the issues
between these parties can be found in the following statement added, almost as
an afterthought, at the end of Mr. Parsons' Notice of Appeal: "This
problem is a personal problem with him and I regarding his girlfriend".
[11]
At the time of drafting the Reply to the Notice
of Appeal, the Minister had few facts upon which to base its assumptions of
fact due to the lack of participation by both parties in the appeal process.
Mr. Dawe testified that he ignored requests from Canada Revenue Agency and
refused to complete a questionnaire forwarded to him. In fact, he admitted that
he only opened the correspondence enclosing the questionnaire earlier in the
same week that the hearing was scheduled to occur. The Respondent counsel
admitted in submissions that the facts in the Reply in this appeal were truly
"assumptions". Mr. Dawe was probably subpoenaed by the Respondent in
the anticipation that he would assist the Court in establishing the true
factual matrix that existed between these two individuals at the time. However,
Mr. Dawe's testimony simply emphasized the truly divergent and vague recall of
events that occurred between them. Since I am unable to draw any conclusions
from the web of stories I heard and since the evidence of neither witness was
convincing, the Minister's assumptions of fact have not been demolished. The appeal
is dismissed, without costs.
Signed at Ottawa,
Canada, this 7th day of May 2014.
"Diane
Campbell"
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