Charest v. Canada, docket T-348-93

     Date: 19990204

     Docket: T-348-93

Ottawa, Ontario, the 4^th day of February, 1999

Before: The Honourable Mr. Justice Pinard

BETWEEN:

ANDRÉ CHAREST,

Plaintiff

AND:

THE QUEEN,

- and -

CANADA EMPLOYMENT

AND IMMIGRATION COMMISSION,

Defendants

AND:

ATTORNEY GENERAL OF CANADA,

Third Party

JUDGMENT

     The plaintiff"s action is dismissed with costs.

Yvon Pinard

J.

Certified true translation

Bernard Olivier

Date: 19990204

     Docket: T-348-93

BETWEEN:

ANDRÉ CHAREST,

Plaintiff

AND:

THE QUEEN,

- and -

CANADA EMPLOYMENT

AND IMMIGRATION COMMISSION,

Defendants

AND:

ATTORNEY GENERAL OF CANADA,

Third Party

REASONS FOR JUDGMENT

PINARD J.:

[1]      The plaintiff is seeking a declaratory order that under section 35 of the Unemployment Insurance Act, R.S.C. 1985, c. U-1 (the "Act"), which is applicable to this proceeding, his debt to the Canada Employment and Immigration Commission (the "Commission") is prescribed and, accordingly, he is asking that the ITA-8958-92 certificate issued in this regard be vacated.

[2]      At the trial, the parties filed a document entitled [Translation] List of admissions as to facts, which reads as follows:

[Translation]

For the purpose of abridging the evidence at the hearing, the parties, by their undersigned counsel, make the following admissions as to the facts in this case and agree that the facts as admitted shall serve as evidence at the hearing in regard to these facts. However, it is agreed that the undersigned counsel reserve the right to prove other facts relevant to the issues in the course of the hearing.

1.      The plaintiff filed an initial claim for unemployment insurance benefits on September 25, 1984 and a benefit period was established in his favour from September 23, 1984 to September 21, 1985;

2.      In support of his claim for benefit, the plaintiff provided a Record of Employment issued by Studio céramique Gisèle Inc.;

3.      For the period covering the benefit period referred to above, the plaintiff received a total of $8,200.00 in unemployment insurance benefits;

4.      In March 1988, an investigation was conducted jointly by the Canada Employment and Immigration Commission (hereinafter referred to as the "Commission") and the Royal Canadian Mounted Police;

5.      On December 16, 1988, the Commission reconsidered the plaintiff"s claim for benefit and retroactively cancelled the benefit period referred to in paragraph 1 of this list of admissions;

6.      This decision of the Commission effectively created an overpayment in the amount of $8,200.00, notice of which was issued to the plaintiff during the week of December 16, 1988;

7.      The plaintiff did not appeal the Commission"s decision to cancel his benefit period within the legal deadlines;

8.      However, on September 8, 1988, Mr. Luc Charest, a close relative of the plaintiff and his employer at the Studio céramique Gisèle Inc., pleaded guilty to twelve (12) charges laid against him. In this regard, the parties agree to file with the Court a document entitled "[Translation ] Report of special investigation" prepared by Mr. Robert Gagné, an investigator for the Commission in 1990;

9.      Luc Charest pleaded guilty in the Superior Court, Criminal Division to an indictable offence under section 338(1)(a) of the Criminal Code, and more specifically "[translation ] to having, by deceit, falsehood or other fraudulent means, whether or not it was a false pretence, defrauded Canada Employment and Immigration of a sum exceeding one thousand dollars in a claim for benefits on behalf of André Joe Charest...";

10.      In early 1989, the plaintiff was charged in the Court of Quebec, Criminal and Penal Division, with having knowingly acquiesced in making a false statement in his record of employment in violation of section 121 (now 103) of the Unemployment Insurance Act (hereinafter the "UIA") then in force;

11.      On February 24, 1989, the plaintiff pleaded not guilty to the charge against him;

12.      On June 3, 1991, the Court of Québec, Criminal and Penal Division, ordered a stay of proceedings on the charge against the plaintiff;

13.      The stay of proceedings was ordered by the Court on the basis of section 11(b) of the Canadian Charter of Rights and Freedoms, and thus there was no trial on the merits;

14.      On November 25, 1992, a certificate bearing the number ITA-8958-92 was issued by the Federal Court of Canada;

15.      On December 1, 1992, the Commission sent the plaintiff a copy of the certificate accompanied by a letter ordering him to pay it the sum of $8,211.00;

16.      The certificate was filed more than 36 months after the establishment of the overpayment;

17.      On October 24, 1994, a charging order on land was rendered by the Federal Court of Canada;

18.      On April 28, 1995, an amended charging order on land was rendered by the Federal Court of Canada, this order correcting the legal description of the land described in the initial order;

19.      Likewise on April 28, 1995, the following order was rendered by the Honourable Mr. Justice Nadon of the Federal Court: "The parties consent that the amended charging order rendered in this proceeding be maintained and that the hearing of the motion for an order absolute imposing a charge on land be adjourned sine die until the Court has ruled in docket T-348-93";

[3]      In addition to these written admissions, Ginette Brasseur, the Commission"s regional benefit programs officer, who was responsible for reviewing entitlement to benefits and at the relevant time was responsible for the plaintiff"s file, testified for the defendants. She expressly stated that she had decided, on the basis of the information contained in the plaintiff"s file and the information obtained during the above-mentioned joint investigation by the Commission and the Royal Canadian Mounted Police, that the plaintiff had committed an offence under subsection 33(1) of the Act. In this regard, the witness filed various documents, including the investigation report referred to in paragraph 8 of the above written admissions and a number of statutory declarations by third parties who, in the relevant period, were working for the employer in question. Ms. Brasseur stated that she had reached this conclusion that the plaintiff had knowingly made false or misleading statements even before she notified him that as a result of the review of his file his benefit period was being retroactively cancelled. She explained that her knowledge of the subsequent events had simply confirmed this conclusion and had led to the registration of the certificate in question.

     * * * * * * * * * * * *

[4]      The plaintiff is technically alleging that the right to recovery of the amounts overpaid to him by the Commission is prescribed, owing to the expiration of the 36-month period enacted in subsection 35(4) of the Act.

     * * * * * * * * * * * *

[5]      It is worth reproducing at this point the following applicable provisions of the Act:

Penalty 33. (1) Where the Commission becomes aware of facts that in its opinion establish that a claimant or any person on his behalf has, in relation to a claim for benefit, made a statement or representation that he knew to be false or misleading or, being required under this Act or the regulations to furnish information, furnished any information or made any representation that he knew to be false or misleading, the Commission may impose a penalty on that claimant not greater than an amount equal to three times his weekly rate of benefit.

Pénalité 33. (1) Lorsque la Commission prend connaissance de faits qui, à son avis, démontrent qu'un prestataire ou une personne agissant pour le compte de celui-ci a, relativement à une demande de prestations ou à l'occasion de renseignements exigés par la présente loi ou par les règlements, sciemment fait une déclaration ou une représentation fausse ou trompeuse, elle peut infliger au prestataire une pénalité dont le montant ne dépasse pas le triple de son taux de prestations hebdomadaires.

Idem (2) The penalty provided under subsection (1) shall not be imposed if a prosecution in respect of the false or misleading statement or representation has been initiated against that person.

Idem (2) La pénalité prévue au paragraphe (1) ne peut être infligée si une poursuite a été intentée contre une personne pour la déclaration ou représentation fausse ou trompeuse.

Idem (3) The penalty provided under subsection (1) shall not be imposed after thirty-six months from the date on which the false or misleading statement or representation was made.

Idem (3) La pénalité prévue au paragraphe (1) ne peut être infligée plus de trente-six mois après la date à laquelle a été faite la déclaration ou représentation fausse ou trompeuse.

Liability for overpayments 35. (1) Where a person has received benefit under this Act for any period in respect of which he is disqualified or any benefit to which he is not entitled, he is liable to repay an amount equal to the amount paid by the Commission in respect thereof.

Obligation de rembourser le trop-perçu 35. (1) Lorsqu'une personne a touché des prestations en vertu de la présente loi au titre d'une période pour laquelle elle était exclue du bénéfice des prestations ou a touché des prestations auxquelles elle n'est pas admissible, elle est tenue de rembourser la somme versée par la Commission à cet égard.

Debts to Crown (2) All amounts payable under this section or section 33, 37 or 38 are debts due to Her Majesty and are recoverable as such in the Federal Court or any other court of competent jurisdiction or in any other manner provided by this Act.

Créances de la Couronne (2) Les sommes payables en vertu du présent article ou des articles 33, 37 ou 38 constituent des créances de Sa Majesté, dont le recouvrement peut être poursuivi à ce titre soit devant la Cour fédérale ou tout autre tribunal compétent, soit selon toute autre modalité prévue par la présente loi.

Recovery (3) Where a benefit becomes payable to any claimant, the amount of any indebtedness described in subsection (1) or (2) may, in the manner prescribed, be deducted and retained out of the benefit payable to him.

Recouvrement par déduction (3) Les sommes dues par un prestataire au titre des créances visées aux paragraphes (1) ou (2) peuvent, selon la manière prescrite, être déduites des prestations qui lui sont éventuellement dues.

Limitation (4) No amount due as a debt to Her Majesty under this section may be recovered after thirty-six months from the date on which the liability arose unless in the opinion of the Commission an offence under subsection 33(1) has been committed in connection therewith in which case no such amount may be recovered after seventy-two months from the date on which the liability arose.

Prescription (4) Le recouvrement des créances visées au présent article se prescrit par trente-six mois à compter de la date où elles ont pris naissance; toutefois, le délai de prescription pour ce recouvrement est porté à soixante-douze mois dans les cas où la Commission estime qu'il a été commis une infraction au paragraphe 33(1).

Reconsideration of claim 43. (1) Notwithstanding section 86 but subject to subsection (6), the Commission may at any time within thirty-six months after benefit has been paid or would have been payable reconsider any claim made in respect thereof and if the Commission decides that a person has received money by way of benefit thereunder for which he was not qualified or to which he was not entitled or has not received money for which he was qualified and to which he was entitled, the Commission shall calculate the amount that was so received or payable, as the case may be, and notify the claimant of its decision.

Nouvel examen de la demande 43. (1) Nonobstant l'article 86 mais sous réserve du paragraphe (6), la Commission peut, dans les trente-six mois qui suivent le moment où des prestations ont été payées ou sont devenues payables, examiner de nouveau toute demande au sujet de ces prestations et, si elle décide qu'une personne a reçu une somme au titre de prestations pour lesquelles elle ne remplissait pas les conditions requises ou au bénéfice desquelles elle n'était pas admissible ou n'a pas reçu la somme d'argent pour laquelle elle remplissait les conditions requises et au bénéfice de laquelle elle était admissible, la Commission calcule la somme payée ou payable, selon le cas, et notifie sa décision au prestataire.

Appeal (2) Any decision made by the Commission pursuant to subsection (1) is subject to appeal under section 79.

Appel (2) Toute décision rendue par la Commission en vertu du paragraphe (1) peut être portée en appel en application de l'article 79.

Amount repayable (3) If the Commission decides that a person has received money by way of benefit for any period in respect of which he was not qualified or money by way of benefit to which he was not entitled, the amount therefor as calculated under subsection (1) is the amount repayable under section 35.

Somme remboursable (3) Si la Commission décide qu'une personne a reçu une somme au titre de prestations auxquelles elle n'avait pas droit ou pour une période durant laquelle elle n'était pas admissible, la somme calculée en vertu du paragraphe (1) est celle qui est remboursable conformément à l'article 35.

(...)

(...)

Extended time for reconsideration of claim under subsection (1) (6) Where, in the opinion of the Commission, a false or misleading statement or representation has been made in connection with a claim, the Commission has seventy-two months within which to reconsider the claim under subsection (1).

Prolongation du délai de réexamen de demande en vertu du par. (1) (6) Lorsque la Commission estime qu'une déclaration ou représentation fausse ou trompeuse a été faite relativement à une demande de prestations, elle dispose d'un délai de soixante-douze mois pour réexaminer la demande en vertu du paragraphe (1).

Certificates 94. (1) An amount payable under Part I that has not been paid or such part of an amount payable under that Part as has not been paid may be certified by the Commission      (a) forthwith, when in the opinion of the Commission the person liable to pay the amount is attempting to avoid payment; and      (b) otherwise, on the expiration of thirty days after the default.	Certificats 94. (1) Une somme ou fraction de somme payable en vertu de la partie I et qui n'a pas été payée peut être certifiée par la Commission :      a) immédiatement, lorsque la Commission est d'avis que la personne qui doit payer cette somme tente d'éluder le paiement de cotisations;      b) sinon, trente jours francs après le défaut de paiement.

(...)

(...)

Offences and Punishment Offence 103. (1) Every person is guilty of an offence punishable on summary conviction who      (a) in relation to any claim for benefit, makes a statement or representation that he knows to be false or misleading;      (b) being required under this Act or the regulations to furnish information, furnishes any information or makes any representation he knows to be false or misleading;      (c) obtains any benefit by false pretences;      (d) makes any claim or declaration that by reason of non-disclosure of facts he knows is false or misleading;      (e) being the payee thereof knowingly negotiates or attempts to negotiate any special warrant for a benefit to which he is not entitled; or      (f) knowingly fails to return any special warrant or the amount thereof or any excess amounts as required by section 36.

Infractions et peines Infraction 103. (1) Commet une infraction punissable sur déclaration de culpabilité par procédure sommaire quiconque, selon le cas :      a) à l'occasion d'une demande de prestations, fait sciemment une déclaration ou représentation fausse ou trompeuse;      b) étant requis en vertu de la présente loi ou des règlements de fournir des renseignements, fait une représentation ou fournit un renseignement qu'il sait être faux ou trompeur;      c) obtient des prestations par de faux semblants;      d) fait une demande ou une déclaration que, en raison de la dissimulation de certains faits, il sait être fausse ou trompeuse;      e) sciemment, négocie ou tente de négocier un mandat spécial établi à son nom pour des prestations au bénéfice desquelles il n'est pas admissible;      f) s'abstient sciemment de renvoyer un mandat spécial ou d'en restituer le montant ou le trop-perçu tel que requis par l'article 36.

Saving (2) No prosecution for an offence under paragraph (1)(a) or (b) shall be instituted if a penalty in respect of that offence has been imposed under subsection 33(1).

Réserve (2) Il ne peut être intenté de poursuite pour une infraction prévue aux alinéas (1)a) ou b) si une pénalité a été infligée pour cette infraction en vertu du paragraphe 33(1).

     * * * * * * * * * * * *

[6]      In an action of this nature, the applicable burden of proof, the civil burden based on the preponderance of probabilities, shifts according to the evidence of the respective parties. Initially, the plaintiff claimant simply has to prove that the defendant Commission commenced its overpayment recovery proceedings more than 36 months after the date on which this account originated. If he succeeds, the Commission must then (1) prove that it commenced its overpayment proceedings on the account in question prior to the expiration of the 72^nd month following the date on which the account originated, (2) that it so acted because it was of the opinion that the plaintiff claimant had committed an offence under subsection 33(1) of the Act and (3) that this opinion, in light of new evidence, is justified. In regard to such justification, proof of the existence of false or incorrect statements may alone suffice in some instances to shift the onus and oblige the plaintiff claimant to explain why he made these incorrect statements.¹

[7]      In the case at bar, the admitted facts clearly demonstrate that the Commission had the certificate in question issued, thereby commencing the recovery of its account from the plaintiff, between the 36^th and the 72^nd month following the date on which this account originated. It is equally clear, from these admissions, complemented by the uncontradicted and credible testimony of the officer responsible for reconsidering the plaintiff claimant"s entitlement to the benefits that had been paid to him, that the Commission thought or was of the opinion that he had committed an offence under subsection 33(1) of the Act at the time the certificate in question was issued.

[8]      It need only be determined, therefore, whether the Commission has succeeded in establishing that this opinion is justified in light of both the facts known and proved at trial and the law in force at the relevant time. In this regard, the mere existence of the plaintiff"s false or misleading statements is firmly established. This is clear from the facts admitted in writing, in particular the Commission"s decision, which was not challenged, to retroactively cancel the benefit period in question at the time it did. The failure to challenge this decision before a board of referees suggests, given the wording of subsection 43(6) of the Act, that the plaintiff claimant considered an opinion of the Commission that he had made one or more false or misleading statements to be justified in fact and in law. It should suffice, moreover, to note the confession of guilt of Luc Charest, the plaintiff"s employer and a close relative, in relation to the fabrication of the fraudulent record of employment on which the plaintiff based his claim for benefit to the Commission. This particular factual context, in my opinion, gives rise to a presumption that the plaintiff"s false statements were made knowingly. To rebut this presumption, the plaintiff had to explain why he made the false statements in question, something he simply did not do. The only views of the plaintiff that might have something to do with this matter appear, and then only in a very limited way, in a "Statutory Declaration to the Commission" filed on consent by his counsel, as exhibit P-1. This document, dated prior to Luc Charest"s confession of guilt, the plaintiff actually refused to sign on the ground that it implicated some members of his family. Be that as it may, in so far as it may be addressed to the specific period of time in question (which is unclear), the document attributes the following remarks to the plaintiff: "[Translation ] I cannot explain that. . . I don"t really understand that . . . Occasionally, Claude would deposit my cheques since I was having such backaches that I could hardly move." To my way of thinking, the content of this document, for the purposes of this case, is of little credibility and certainly does not contain the relevant, plausible and reasonable explanations needed to rebut the above presumption that the plaintiff"s false statements were made knowingly. I must therefore conclude, in the circumstances, that the Commission has adequately justified its opinion that the plaintiff knowingly made the false statements in question, thereby committing an offence under subsection 33(1) of the Act, as provided in subsection 35(4) of the Act.

[9]      I am also of the opinion that the decisions in Courty (May 11, 1987), T-713-87 (F.C.T.D.) and Martel (July 14, 1989), T-2416-87 (F.C.T.D.), cited by the plaintiff, do not support the proposition that a mere failure by the Commission to impose a penalty on the claimant under subsection 33(1) of the Act suffices to bar the extension of the limitation period to 72 months pursuant to subsection 35(4). In those cases, unlike the present situation, insufficient evidence was provided to the Court by the Commission to justify the factual and legal validity of its opinion that false or misleading statements had knowingly been made by some claimants.

[10]      Finally, the plaintiff"s submission that the stay of the proceedings against him by the Court of Quebec, Criminal and Penal Division, renders inadmissible the evidence in this Court tending to demonstrate that he knowingly made the false statements in question must also be rejected on the ground that the judgments of criminal courts are not res judicata in subsequent civil trials. In Time Data Recorder International Ltd. v. The Minister of National Revenue (April 21, 1997), A-518-93, Pratte J.A. of the Federal Court of Appeal stated, at page 7:

     It is also common ground that, as a rule, judgments of criminal courts are not "res judicata" in subsequent civil trials.⁷ There are many reasons for that: first, in most cases, the parties in the criminal and civil trials are not the same; second, very often, the questions to be resolved in both litigations are not identical; finally, the burden of proof is not the same in criminal and civil proceedings.

7See: Fishman v. R.,(1970) Ex.C.R. 784 at 826; Hollington v. Hewthorne & Co. Ltd., (1943) K.B. 587 at 601, (1943) 2 All E.R. 35 (C.A.); Sopinka, Lederman, Bryant, The Law of Evidence in Canada, Butterworths, 1992, p. 1045; Cross on Evidence, 7th edition, Butterworths, 1990, p. 84.

[11]      For all of these reasons, therefore, the action is dismissed with costs.

Yvon Pinard

J.

OTTAWA, Ontario

February 4, 1999

Certified true translation

Bernard Olivier

FEDERAL COURT OF CANADA

TRIAL DIVISION

NAMES OF COUNSEL AND SOLICITORS OF RECORD

FILE NO:                  T-348-93

STYLE:                  ANDRÉ CHAREST V. THE QUEEN AND THE

CANADA EMPLOYMENT AND IMMIGRATION

COMMISSION

PLACE OF HEARING:          MONTRÉAL, QUEBEC

DATE OF HEARING:          JANUARY 18, 1999

REASONS FOR JUDGMENT OF PINARD J.

DATED:                  FEBRUARY 4, 1999

APPEARANCES:

DIANE RAINVILLE

GILBERT NADON              FOR THE PLAINTIFF

HÉLÈNE BEAUMONT

MÉLANIE RAYMOND          FOR THE DEFENDANTS

SOLICITORS OF RECORD:

CAMPEAU, OUELLET, NADON, BARABÉ,

CYR, DE MERCHANT, BERNSTEIN, COUSINEAU

HEAP, PALARDY,

MONTRÉAL, QUEBEC          FOR THE PLAINTIFF

MORRIS ROSENBERG

DEPUTY ATTORNEY GENERAL

OF CANADA              FOR THE DEFENDANTS

__________________

¹ See Attorney General of Canada v. Katherine Gates (May 12, 1995), A-600-94 (F.C.A.).