Canada v. Vadnais, 2002 FCT 25

Date: 20020109

Docket: T-44-01

Neutral citation: 2002 FCT 25

BETWEEN:

                                                        HER MAJESTY THE QUEEN

                                                                                                                                                         Plaintiff

                                                                             - and -

                                                               KENNETH VADNAIS

                                                                                                                                                   Defendant

                                                            REASONS FOR ORDER

LEMIEUX J.:

[1]                 Her Majesty the Queen (the "federal Crown"), as plaintiff, moves the Court in writing pursuant to Rule 369 and 213 of the Federal Court Rules, 1998, (the "Rules") for summary judgment in its action commenced on January 10, 2001.

[2]                 In this action, the federal Crown alleges the defendant owes it the sum of $64,862.98 plus pre-judgment interest from January 31, 2001 at the per diem rate of $20.86 until payment or judgment and post-judgment interest at the same rate is paid.

[3]                 Kenneth Vadnais, the defendant, filed a statement of defence on February 22, 2001, in which he pleads he does not owe the amount claimed because any liability for this amount, consisting essentially of interest, was compromised by the federal Crown when it accepted full restitution before sentencing of the amount of $55,432.17, after the defendant was charged and pleaded guilty, in 1995, on three counts of submitting false applications under the Special Canadian Grains Program.

[4]                 Rule 316 of the Rules provides, on a motion for summary judgment, where the Court is satisfied there is no genuine issue for trial, the Court shall grant summary judgment.

[5]                 Furthermore, Rule 215 provides a response to a motion for summary judgment shall not rest merely on allegations or denials of the pleading of the moving party, but must set out specific facts showing there is a genuine issue for trial.

[6]                 The defendant filed an affidavit stating, on October 30, 1995, he and his counsel, Arthur N. Larson, attended before Mr. Justice John Waite of the Court of Queen's Bench of Alberta, at the courthouse in Lethbridge, Alberta, and entered guilty pleas on all counts. Sentencing was put over to January 8, 1996, to allow him an opportunity to make restitution to Agriculture Canada.

[7]                 Mr. Vadnais deposed his solicitor engaged the Crown prosecutor, Daniel M. McDonald, in discussions relating to sentence and attached, to his affidavit, Mr. McDonald's correspondence to his solicitor dated October 20, 1995, in which he states:

. . . and if full restitution shall have been made before sentence, then the Crown's submissions will be that sentence on a global bases should be in the range of 6 months to 12 months imprisonment.

[8]    Mr. Vadnais' affidavit appends an October 24, 1995 letter from Mr. Larson to Mr. McDonald which said this in point number 3:

If full restitution is made to the Complainants herein in the amount of $55,432.17 then there shall be a joint submission for a global sentence of six months incarceration. In the event that such restitution is not made there will be an "open" sentencing.

[9]    Mr. Vadnais states he made payment of that amount to his solicitor and Mr. Larson forwarded the same to Agriculture Canada. He appends a copy of his solicitor's trust cheque dated January 4, 1996, to the order of the Receiver General in the amount of $55,432.17. Mr. Vadnais then deposes he was sentenced by Mr. Justice Waite on January 8, 1996 and, at that time, Mr. McDonald, the Crown prosecutor in the case, indicated to Justice Waite full restitution had been made.

[10]                         Mr. Vadnais concludes his affidavit by deposing the following:

Thereafter, I was imprisoned pursuant to the Court's sentence. By instructing Mr. Larson to enter the guilty pleas referred to in his Affidavit and by instructing him to forward funds to the Department of Agriculture Canada, I expected that I would be relieved of any further penalty or payment in any civil or criminal matter surrounding the circumstances giving rise to the charges. I believe that was clear to the Prosecutor when he accepted payment.

[11]            The federal Crown's motion record contains a copy of a letter dated January 5, 1996, from Legal Counsel, Legal Services, Agriculture Canada to Mr. Larson which reads:

Further to the above-noted matter and our telephone conversation, I wish to inform you that the Department of Agriculture and Agri-Food Canada accepts your client's offer to repay the Department the $55,432.17 fraudulently obtained by him under the CCDAP and the SCGP-87 programs.

Please note that acceptance of said repayment in no way constitutes, in our view, full and final payment of amounts owing to us by Mr. Vadnais. The Department of Agriculture and Agri-Food reserves its right to take all other legal measures at its disposal to recover the remainder of the amounts owing.

[12]            The federal Crown argues there is no evidence in support of the contention advanced by the defendant the restitution of the principal amount received was in satisfaction of the entire debt, inclusive of interest charges. It adds the only evidence available unequivocally confirms Mr. Vadnais was not discharged from his obligations to pay interest charges, evidence which is uncontradicted. The federal Crown argues, in absence of any evidence to the contrary, the plaintiff ought to be awarded an order granting summary judgment for the unpaid interest charges.

[13]            Counsel for the defendant opposing this motion, who was not Mr. Larson, argues accord and satisfaction, namely the acquisition of a release from an obligation, whether arising under contract or tort, by means of any valuable consideration not being the actual performance of the obligation itself.

[14]              Counsel for the defendant argues in his written submissions:

10.        In the present case, not only did Mr. Vadnais make payments of money as pleaded but also entered into a guilty plea, effectively saving the Crown the expense and trouble of a trial. Mr. Vadnais' delivery of such consideration was based on the Crown's agreement that payment of the sum of $55,432.17 would be accepted as full restitution.

11.        The Crown, having received the benefit of its bargain, cannot now attempt to resort to the original contract and seek interest.

12.        The issues raised by the pleadings filed in this action, together with the evidence contained within Mr. Vadnais' Affidavit raise a factual issue which cannot be conveniently or properly determined summarily on the basis of Affidavit evidence. The appropriate next step in this matter is to refer the matter to Examinations for Discovery in order that both parties might better determine the facts of this action.

[15]            I accept the proposition advanced by counsel for the defendant, on a motion for summary judgment, a motions judge should not act like a trial judge making findings of fact based on conflicting evidence.

[16]            In the case before me, there is clear evidence that before the sentencing took place on January 8, 1996, the defendant's then legal adviser was advised orally and subsequently by follow-up letter of January 5, 1996, by legal counsel in Agriculture Canada's Legal Services, it accepted repayment of the $55,432.17 but this acceptance "in no way constitutes, in our view, full and final payment of the amounts owing to us by Mr. Vadnais".

[17]            The federal Crown produced legal counsel to Agriculture Canada's January 5, 1996 letter in its motion record under affidavit of Fereen Bravar dated June 12, 2001.

[18]            In his response affidavit dated June 27, 2001, the defendant is silent and makes no comment on the January 5, 1996 letter to Mr. Larson.

[19]            Mr. Vadnais does not contradict the January 5, 1996 letter from legal counsel to Agriculture Canada either in his affidavit or by producing other documentation denying this letter was not accurate and did not constitute the understanding between the parties.

[20]            Mr. Vadnais refers to the Crown prosecutor's indication to Justice Waite full restitution was made. On its face, this statement was true because that was the amount of the loans accorded to him based on the false misrepresentations made. It led to a reduced sentence of six months which was the bargain he made in the context of the criminal proceedings.

[21]            The federal Crown's action is a civil proceeding of a different nature and, as indicated, the uncontradicted evidence is that the federal Crown did not waive repayment of interest.

[22]            For all of these reasons, summary judgment is granted against the defendant in the amount of $64,862.98 plus pre-judgment and post-judgment interest at a per diem rate of $20.86 until paid. Costs against the defendant are fixed at $1,000.00.

                                                                                                                           "François Lemieux"    

                                                                                                                                          J U D G E          

OTTAWA, ONTARIO

January 9, 2002