A-831-95
MONTRÉAL, QUEBEC, THIS 20th DAY OF SEPTEMBER 1996
CORAM: THE
HONOURABLE MR. JUSTICE MARCEAU
THE
HONOURABLE MR. JUSTICE DÉCARY
THE
HONOURABLE DEPUTY JUSTICE CHEVALIER
BETWEEN: ATTORNEY
GENERAL OF CANADA,
Applicant,
AND:
NORMAND
CHARBONNEAU,
Respondent.
J U D G
M E N T
The
application is allowed, the decision a quo is set aside and the matter
is referred back to the Tax Court of Canada to be redetermined on the basis
that the respondent was not engaged in insurable employment under the Unemployment
Insurance Act.
signed: Louis
Marceau
J.A.
Certified true translation
C. Delon, LL.L.
A-832-95
MONTRÉAL, QUEBEC, THIS 20th DAY OF SEPTEMBER 1996
CORAM: THE
HONOURABLE MR. JUSTICE MARCEAU
THE
HONOURABLE MR. JUSTICE DÉCARY
THE
HONOURABLE DEPUTY JUSTICE CHEVALIER
BETWEEN: ATTORNEY
GENERAL OF CANADA,
Applicant,
AND:
NORMAND
CHARBONNEAU,
Respondent.
J U D G
M E N T
The
application is allowed, the decision a quo is set aside and the matter
is referred back to the Tax Court of Canada to be redetermined on the basis
that the respondent was not engaged in insurable employment under the Unemployment
Insurance Act.
signed: Louis
Marceau
J.A.
Certified true translation
C. Delon, LL.L.
A-831-95
CORAM: MARCEAU
J.A.
DÉCARY
J.A.
CHEVALIER
D.J.
BETWEEN: ATTORNEY
GENERAL OF CANADA,
Applicant,
AND:
NORMAND
CHARBONNEAU,
Respondent.
A-832-95
BETWEEN: ATTORNEY
GENERAL OF CANADA,
Applicant,
AND:
NORMAND
CHARBONNEAU,
Respondent.
Hearings
held at Montréal
on
September 19 and 20, 1996
Judgment
delivered at Montreal
on
Friday, September 20, 1996
REASONS FOR JUDGMENT OF THE COURT BY: DÉCARY
J.A.
A-831-95
MONTRÉAL, QUEBEC, THIS 20th DAY OF SEPTEMBER 1996
CORAM: THE
HONOURABLE MR. JUSTICE MARCEAU
THE
HONOURABLE MR. JUSTICE DÉCARY
THE
HONOURABLE DEPUTY JUSTICE CHEVALIER
BETWEEN: ATTORNEY
GENERAL OF CANADA,
Applicant,
AND:
NORMAND
CHARBONNEAU,
Respondent.
A-832-95
BETWEEN: ATTORNEY
GENERAL OF CANADA,
Applicant,
AND:
NORMAND
CHARBONNEAU,
Respondent.
REASONS FOR
JUDGMENT OF THE COURT
(Delivered
from the bench at Montréal
on
Friday, September 20, 1996.)
DÉCARY J.A.
Contract
of employment or contract of enterprise? This, once again, is the question
that arises in this case, the issue in which is whether the respondent, the
owner and operator of a skidder, was engaged in insurable employment for the
purposes of the application of paragraph 3(1)(a) of the Unemployment
Insurance Act.
Two
preliminary observations must be made.
The
tests laid down by this Court in Wiebe Door Services Ltd. v. M.N.R.[1] — on the one hand, the
degree of control, the ownership of the tools of work, the chance of profit and
risk of loss, and on the other, integration — are not the ingredients of a
magic formula. They are guidelines which it will generally be useful to
consider, but not to the point of jeopardizing the ultimate objective of the
exercise, which is to determine the overall relationship between the parties.
The issue is always, once it has been determined that there is a genuine
contract, whether there is a relationship of subordination between the parties
such that there is a contract of employment (art. 2085 of the Civil Code of
Québec) or, whether there is not, rather, such a degree of autonomy that
there is a contract of enterprise or for services (art. 2098 of the Code). In
other words, we must not pay so much attention to the trees that we lose sight
of the forest — a particularly apt image in this case. The parts must give way
to the whole.
Moreover,
while the determination of the legal nature of the contractual relationship
will turn on the facts of each case, nonetheless in cases that are
substantially the same on the facts the corresponding judgments should be
substantially the same in law. As well, when this Court has already ruled as
to the nature of a certain type of contract, there is no need thereafter to
repeat the exercise in its entirety: unless there are genuinely significant
differences in the facts, the Minister and the Tax Court of Canada should not
disregard the solution adopted by this Court.
In
our view, when the judge of the Tax Court of Canada allowed the respondent's
appeals in this case and found that the contract was a contract of employment,
he felt into the trap of doing a too mathematical analysis of the tests in Wiebe
Door, and as a result he wrongly disregarded the solution adopted by this
Court in Attorney General of Canada v. Rousselle et al.[2] and upheld in Attorney General of
Canada v. Vaillancourt[3].
Here,
the payer was a forestry business. It assigned the work of felling and hauling
the wood to crews of two persons — a feller, who cut the trees, and a skidder
operator, who picked them up and transported them to the edge of a forest
road. The respondent was the owner of the skidder, a piece of heavy machinery
valued at about $15,000, and he was responsible for the cost of maintaining and
repairing it. He had himself recruited the feller, with whom he made up a
crew. He and the feller were paid by volume, based on the number of cubic
metres of wood cut down, and the contract did not specify any volume; the
volume was measured every two weeks by a "measurer" employed by the
payer.
At
the time the contract was signed, the respondent was given [translation] "a list and terms of
holidays" which, according to the evidence, was based on provincial
employment standards. He was also given a document containing [translation] "internal regulations
for workers in forests" which, according to the testimony of a
representative of the payer, reflected the requirements of the Quebec ministère
des Ressources naturelles. Appended to that document were [translation] "general rules",
that is, a list of technical details relating to cutting down trees, as well as
the [translation] "minimum
standards for protecting forests against fire" laid down by the Société de
conservation de l'Outaouais.
The
respondent worked about thirty-two hours per week and his daily work period was
generally, but not necessarily, within the period proposed in the internal
regulations, that is, between 7:30 a.m. and 4:00 p.m. A foreman employed by
the payer checked every second day to ensure that the respondent's crew was in
fact cutting the trees that had previously been identified by the payer. The
method of payment was as follows: one quarter of the amount owing to the crew
was paid to the respondent, one quarter was paid to the feller, and half was
paid to the respondent for the use of the skidder. Thus three cheques were
issued by the payer every two weeks. The cost of transporting the skidder at
the beginning and end of the season was borne by the respondent; in the event
that there was a change of location during the season, it was borne by the
payer.
When
we look at the overall picture, it is quite apparent that this was, prima
facie, a contract of enterprise. The ownership of the skidder, the choice
of the other crew member, payment based on an undefined volume and the autonomy
of the crew are determining factors which, in the context, can only be
associated with a contract of enterprise.
Supervision
of the work every second day and measuring the volume every two weeks do not,
in this case, create a relationship of subordination, and are entirely
consistent with the requirements of a contract of enterprise. It is indeed
rare for a person to give out work and not to ensure that the work is performed
in accordance with his or her requirements and at the locations agreed upon.
Monitoring the result must not be confused with controlling the worker.
The
same is true of the standards imposed in respect of hours and days of work,
holidays, operating method and safety. The standards are common to all workers
in public forests whose activities are "governed" by the ministère
des Ressources naturelles. They apply regardless of whether the worker is a
mere employee or a contractor.
One
factor on which the judge relied, and which led him to conclude that [translation] "there could be no
chance of profit and risk of loss" during the contract, was the fact that
the respondent was paid a wage, at the rate of $2.50 per hour. This is a major
factual error. In fact, the respondent was paid based on his volume of
production, and the mere fact that his skidder had broken down would be sufficient
for him to find himself with nothing.
Counsel
for the respondent advanced a hypothesis which the judge seems to have
accepted: in this case, two distinct contracts were made, one a contract of
employment and the other a contract for the lease of the skidder, so that the
fact that the respondent was the owner of the skidder and bore the cost of
maintaining and repairing it should not be taken into consideration in
analysing the contract of employment, properly speaking. If in fact the
hypothesis that there was a dual contract has the legal effects reckoned on by
the respondent, it is not based on any evidence in this case and could most
certainly not have been considered, and a fortiori adopted, by the
judge.
The
observations we have made had already been made by this Court, with slight
variations, in Rousselle. While that case involved a contract of
convenience, the Court could not have decided it based on that aspect alone and
was required to examine the relations between the parties in detail, which it
did. The respondent has not satisfied us that it was open to it, in the
instant case, to disregard the conclusion of this Court in Rousselle.
The
application for judicial review will be allowed, the decision of the Tax Court
of Canada will be set aside and the matter will be referred back to it to be
redetermined on the basis that the respondent was not engaged in insurable
employment.
signed:
Robert Décary
J.A.
Certified true translation
C. Delon, LL.L.
Federal Court of Canada
Court file No. A-831-95
between
ATTORNEY GENERAL
OF CANADA,
Applicant,
— and —
NORMAND CHARBONNEAU,
Respondent.
REASONS FOR JUDGMENT
Federal Court of Canada
Court file No. A-832-95
between
ATTORNEY GENERAL
OF CANADA,
Applicant,
— and —
NORMAND CHARBONNEAU,
Respondent.
REASONS FOR JUDGMENT
FEDERAL
COURT OF APPEAL
NAMES
OF COUNSEL AND SOLICITORS OF RECORD
COURT FILE NO: A-831-95
STYLE OF CAUSE: ATTORNEY
GENERAL OF CANADA
AND:
NORMAND
CHARBONNEAU
PLACE OF HEARING: Montréal,
Quebec
DATE OF HEARING: September
19 and 20, 1996
REASONS FOR JUDGMENT OF THE COURT
(MARCEAU AND DÉCARY JJ.A. AND CHEVALIER D.J.)
DELIVERED FROM THE BENCH BY: The
Honourable Mr. Justice Décary
Dated: September
20, 1996
APPEARANCES:
Claude
Provencher for
the applicant
Diane
Rainville for
the respondent
SOLICITORS OF RECORD:
George
Thomson
Deputy
Attorney General of Canada
Montréal,
Quebec for the
applicant
CAMPEAU,
OUELLET & ASSOCIÉS
Montréal,
Quebec for the
respondent
FEDERAL
COURT OF APPEAL
NAMES
OF COUNSEL AND SOLICITORS OF RECORD
COURT FILE NO: A-832-95
STYLE OF CAUSE: ATTORNEY
GENERAL OF CANADA
AND:
NORMAND
CHARBONNEAU
PLACE OF HEARING: Montréal,
Quebec
DATE OF HEARING: September
19 and 20, 1996
REASONS FOR JUDGMENT OF THE COURT
(MARCEAU AND DÉCARY JJ.A. AND CHEVALIER D.J.)
DELIVERED FROM THE BENCH BY: The
Honourable Mr. Justice Décary
Dated: September
20, 1996
APPEARANCES:
Claude
Provencher for
the applicant
Diane
Rainville for
the respondent
SOLICITORS OF RECORD:
George
Thomson
Deputy
Attorney General of Canada
Montréal,
Quebec for the
applicant
CAMPEAU,
OUELLET & ASSOCIÉS
Montréal,
Quebec for the
respondent
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