Citation: 2017 TCC 83
Date: 20170518
Docket: 2015-533(IT)I
BETWEEN:
FARZAD
PAKZAD,
Appellant,
and
HER
MAJESTY THE QUEEN,
Respondent.
REASONS
FOR ORDER
Campbell J.
Introduction:
[1]
The Appellant, Farzad Pakzad, brought a motion
under the Informal Procedure Rules for a publication ban in respect to this
Court’s reasons contained in Pakzad v. The Queen, 2016 TCC 144, as well
as two prior non-publication requests made to this Court and my reasons in this
motion. He requested that none of this information be published on the Tax
Court of Canada website because of the consequences that would result from such
publication.
[2]
Briefly, the Appellant believes that a
publication ban is justified because if the reasons, in respect to the decision
in his appeal, are published on the Court’s website, the personal information
and unflattering descriptions of his business acumen, contained in those
reasons, would attract the attention of criminals resulting in financial and
physical harm to himself, his family and the public.
[3]
At the commencement of the motion, the Appellant
requested permission to show several short video clips from Global News, CTV
News and the RCMP, which referenced instances of identity theft and the
importance of protecting against identity theft. The Respondent opposed the
admission of these videos into evidence on the basis that they might contain
inadmissible hearsay, opinion or expert evidence. I permitted the Appellant to
show these clips in Court provided that they were used to assist the Appellant
in explaining his arguments in support of his motion but that they would not be
relied upon as expert evidence.
Background:
[4]
On March 24, 2014, the Minister of National
Revenue (the “Minister”) reassessed the Appellant and disallowed the deduction
of business expenses against his employment income for the 2010 and 2011 taxation
years. The Minister’s decision was confirmed on January 26, 2015 and a Notice
of Appeal was filed on February 2, 2015, with the hearing of the appeal taking
place on November 30, 2015. Mr. Pakzad was represented by legal counsel at the
hearing. On June 10, 2016, Deputy Judge Masse issued his reasons and dismissed
the appeal because the alleged business activities were not carried on in a
sufficiently commercial like manner to constitute a source of business income
for which business losses and expenses could be claimed. An amended judgment, dated
June 24, 2016, was issued to address spelling errors but it did not affect the
reasons for the appeal being dismissed. Mr. Pakzad was the only witness at the
hearing of his appeal and he has not appealed the decision.
[5]
Mr. Pakzad did not request a publication ban or
other similar relief, such as an in-camera hearing or a confidentiality order,
either before or during the hearing of his appeal. However, on June 13, 2016,
the Appellant made his first request to the Court for a non-publication ban.
This request consisted of a telephone call to the Registry Office and a one
page fax asking the Court to “…not put any info or details re this matter ONR
(sic) my name on the Tax Court Website and the Internet”. The Court denied this
request on June 17, 2016 and advised the Appellant’s legal counsel. On June 20,
2016, Mr. Pakzad advised the Court that he was now representing himself and
indicated he would be providing follow-up information. His second request for a
publication ban was made by letter dated June 22, 2016 in which he stated that,
since his name became listed on the Court’s website, unknown individuals had
been contacting him to find out more information about him. He further advised
that if the reasons respecting his appeal were published on the website, these
individuals could then access personal information to perpetrate crimes against
him. If this occurs, Mr. Pakzad states that he will then notify the media, file
a complaint with the RCMP and commence legal action against this Court. In
response to this second request, the Court forwarded a letter dated June 24,
2016 to Mr. Pakzad directing him to present this request by way of a motion
with supporting affidavit.
[6]
On March 16, 2017, the Appellant brought the
present motion, the substance of which is very similar to his second request
except that he also argued that the reasons should not be published because it
portrayed him as an incompetent businessman which marked him as an “ideal
target for various criminals”.
The Law and Jurisprudence:
[7]
The applicable test for granting publication
bans and sealing orders originates from two Supreme Court of Canada decisions
contained in Dagenais v Canadian Broadcasting Corp., [1994] 3 SCR
835 and R v Mentuck, 2001 SCC 76, [2001] 3 S.C.R. 442. This is sometimes
referred to as the Dagenais/Mentuck test. The test was slightly reformulated
in the Supreme Court of Canada decision in Sierra Club of Canada v Canada
(Minister of Finance), 2002 SCC 41, [2002] 2 S.C.R. 522 to include commercial
interests. This test applies equally to all judicial proceedings, regardless of
the forum, nature of the claim or the particular stage of the proceedings.
Because such discretionary decisions will affect the openness of court
proceedings, this test is a strict one with the burden of establishing the
specific circumstances, that would justify departure from the open court
principle, resting with the individual who is making the request. The “open
court principle” forms the hallmark of a democratic society and a cornerstone
of the common law. (Vancouver Sun (Re), 2004 SCC 43, [2004] 2 SCR
332, at paragraphs 24-26). At paragraph 25, the Supreme Court of Canada has
described the rationale behind this principle in the following manner:
25 Public
access to the courts guarantees the integrity of judicial processes by
demonstrating “that justice is administered in a non-arbitrary manner,
according to the rule of law”: Canadian Broadcasting Corp. v. New Brunswick
(Attorney General), supra, at para. 22. Openness is necessary to maintain the
independence and impartiality of courts. It is integral to public confidence
in the justice system and the public’s understanding of the administration of
justice. Moreover, openness is a principal component of the legitimacy of the
judicial process and why the parties and the public at large abide by the
decisions of courts.
[8]
An applicant who wishes to limit openness to
Court proceedings and freedom of expression bears a significant evidentiary
burden. The open court principle ensures that the public has access to the
court system and the proceedings that occur within these institutions.
Restrictions placed on the dissemination of information found in the court
system limit the public’s freedom to express ideas and opinions about the
operation of the courts, contrary to paragraph 2(b) of the Canadian Charter
of Rights and Freedoms (the “Charter”). The purpose of the Dagenais/Mentuck
test is to balance this freedom of expression with other important interests,
including maintaining the legitimacy of the judicial system while protecting
the privacy and security interests of affected parties (Vancouver Sun, at
paragraph 28). Public access to the court’s proceedings and decisions also
ensures that the courts are administering justice in a consistent manner and in
accordance with the rule of law (Canadian Broadcasting Corp. v Canada
(Attorney General), 2011 SCC 2, [2011] 1 S.C.R. 19, at paragraph 1). Public
access instills confidence in a court’s proceedings and, specifically in respect
to this Court, the public’s understanding of the administration of the taxation
system largely through its published decisions.
[9]
The right of the public to access the courts is
considered one of necessity rather than convenience. The application of the Dagenais/Mentuck
test generally slants heavily against granting publication bans due to their
fundamental inconsistency with paragraph 2(b) of the Charter, as well as
their tendency to impair the open court principle. Under the Dagenais/Mentuck
test, courts should only grant publication bans when:
(a) such an order is necessary in order to prevent a serious risk to the
proper administration of justice because reasonably alternative measures will
not prevent the risk [the “Necessity Requirement”]; and
(b) the salutary effects of the publication ban outweigh the deleterious
effects on the rights and interests of the parties and the public, including
the effects on the right to free expression, the right of the accused to a fair
and public trial, and the efficacy of the administration of justice [the
“Proportionality Requirement”].
(References
contained in the parenthesis added)
(Sierra Club,
at paragraph 45)
[10]
When applying the first branch of the test, the
Necessity Requirement, the Court must review three elements: first, the risk to
the applicant must be real, substantial and well-grounded in the evidence such
that it is viewed as a serious risk to be avoided and not simply a substantial
benefit or advantage to the individual seeking non-publication; second, the
phrase, administration of justice, should be interpreted in a manner so as not
to allow the concealment of an excessive amount of information, the disclosure
of which is compatible with the public interest; third, a publication ban is necessary
in order to address the risk because there are no other reasonable
alternatives. (Mentuck, at paragraphs 34‑36).
[11]
The primary focus of this first branch of the
test is on the existence of a serious risk that can only be addressed by some
form of non-publication order. Purely personal risks, such as negative media
publicity, damage to personal reputation, embarrassment or potential economic
harm, will not be sufficient to displace the open court principle. The risk to
be avoided must involve an interest of public significance and not simply a
private interest of the applicant (Sierra Club at paragraph 55). The
decision in MEH v Williams, 2012 OACA 35, at paragraph 25, made the
following comment on purely personal elements:
…Thus, the
personal concerns of a litigant, including concerns about the very real
emotional distress and embarrassment that can be occasioned to litigants when
justice is done in public, will not, standing alone, satisfy the necessity
branch of the test.
[12]
Interests that will engage the Necessity Requirement
are typically in respect to those individuals that society recognizes as more
vulnerable to public scrutiny such as minors, the elderly and the disabled.
[13]
The focus of the second branch of the Dagenais/Mentuck
test, the Proportionality Requirement, is solely on balancing the interests
that will be impacted by a publication ban. Charter principles in
respect to freedom of speech under paragraph 2(b) may need to be considered.
The Supreme Court of Canada in Sierra Club, at paragraph 75, identified
the following three core values respecting freedom of expression that will be
at issue in applications for publication bans: seeking the truth and the common
good, prompting self‑fulfillment of individuals by allowing them to
develop thoughts and ideas as they see fit and ensuring that participation in
the political process is open to all persons. The greater the detriment to
these core values that the publication ban will be, the less justifiable the
issuance of such an order will be. The burden will be on the applicant to
establish that the effects of a publication ban outweigh the deleterious
effects on the rights and interests of the parties and the public.
The Appellant’s Position:
[14]
Mr. Pakzad stated that his sole intention for
requesting a publication ban was to protect himself, his family and the public
from financial and physical harm that could result from the disclosure of
personal information. He specifically denied that this motion was motivated by
a desire to avoid potential embarrassment from publication of the decisions in
his appeal and this motion. He argued three points in support of this motion.
First, if his motion is not allowed, it would be contrary to procedural
fairness. Mr. Pakzad claims that prior to the commencement of his appeal, he
contacted the Registry office concerning the process and specifically the
amount of personal information of taxpayers contained in published decisions on
the Court’s website. He further claims that he was informed that this Court
does not publish every decision and that to avoid having a decision published he
would simply have to make that request in writing after the decision is issued.
He also stated that it would be unfair to hold the fact that he did not apply
for an in-camera hearing against him, as the Court did not inform him of this
alternative. Second, he argued that if the reasons in his appeal and this
motion are published, he, his family and the public will become targets for
fraud, identity theft and physical harm. To support this claim, he referred to
the following personal information contained in the reasons of the trial judge:
the finding that he had poor business acumen, his current and prior home
addresses, payments in respect to home insurance, property taxes and rent, the
fact that he had credit cards and RRSPs, his current work hours, his travel
destinations, the amount of his business income and the fact that he ran the
businesses on a cash basis. The Appellant claimed that during the period
immediately after the Court published the decision from the appeal (those
reasons were removed when the motion was filed), unknown individuals began
contacting him by phone and in person at his residence. They allegedly advised
him that they obtained information on him from the published reasons on this
Court’s website. He suggested that if his motion is denied he will be a
“sitting duck”. (Transcript, page 74, line 24). To illustrate and support the
seriousness of this claimed risk of harm, he relied on the video clips that I
permitted him to show during the hearing, as well as various studies conducted
by the Canadian Anti‑Fraud Centre, which summarized the frequency and
financial impact of mass marketing frauds. Third, Mr. Pakzad argued that it was
unfair that the reasons in his appeal were far more detailed than other
decisions of this Court.
The Respondent’s Position:
[15]
The Respondent argued that the Appellant has not
satisfied the Dagenais/Mentuck test, as he did not present sufficient
evidence to support his claim that publication would result in serious risks to
the Appellant and to the administration of justice. No serious risk of a public
nature has been identified and his other claim of becoming a target for
criminals is unsubstantiated and purely personal. Personal information, voluntarily
introduced at the hearing and by necessity considered by the judge in
dismissing the Appellant’s appeal, was not sensitive information requiring non-publication.
In addition, granting this motion will produce no salutary effects, but
potentially will produce numerous deleterious effects. Non-publication will
diminish the public’s confidence in the integrity of the income tax system and
prevent the public from accessing examples of alleged business activities
similar to the Appellant’s that do not constitute a source of income and cannot
be used to reduce ones tax liability. Finally, the Respondent pointed out that
the effectiveness of a publication ban may be moot because the decision is already
available on subscription based databases and discussed at length in
commentaries.
Analysis:
[16]
To be successful in this motion, the Appellant
has the burden of establishing, by way of clear and convincing evidence, that
the requested publication ban is essential in order to prevent a real and
substantial risk of a public nature to himself and his family. He must also
demonstrate that there are no alternative measures to address this alleged risk
and that the salutary effects of the publication ban outweigh its deleterious
effects. Unfortunately, the Appellant has not satisfied either branch of the Dagenais/Mentuck
test and, consequently, he has been unable to justify this Court imposing a
publication ban that would displace the open court principle.
[17]
The open court principle, which forms the
cornerstone of the common law, applies to all proceedings of the Tax Court of
Canada, as a superior Court of record. Accessibility to written decisions of
this Court on its website is integral to the public’s confidence in the justice
system and to the public’s understanding of the administration and operation of
this country’s taxation system. Publication bans by their very nature derogate
from the otherwise unrestricted accessibility to the workings of the courts.
That openness forms the underlying foundation of impartiality of the judicial
system. Availability of courts’ decisions to the general public is central to
the open court principle.
[18]
The central document in this motion is the
decision in the Appellant’s appeal. That decision does contain some personal
information, but no more so than other decisions dealing with similar issues and
not as much personal information as some other decisions contain. Deputy Judge
Masse did list the Appellant’s prior and present address, his employer and his
salary in the relevant taxation years. It also contains information regarding
his education and details of his alleged businesses. All of the personal
information was introduced into evidence by the Appellant through his
evidence-in-chief and in cross‑examination. The content of the reasons is
what one would expect in order for a court to be able to adequately address the
issues of such an appeal. None of it could be deemed to be sensitive
information. The RCMP website, referenced in the Appellant’s motion materials,
in respect to identity theft and fraud, contains a list in respect to the type
of personal information that should not be disclosed. Although there is no
caselaw from this Court respecting the meaning of the term referred to by the
Respondent as “sensitive information”, this Court’s Practice Note 16, published
December 8, 2008, provides guidance in respect to the type of information that
parties should refrain from disclosing in pleadings or documents filed in this
Court. This Practice Note cautions that all evidence received by the Court is
generally part of public records that will be open to inspection by the public.
Further, when taxpayers’ documents are placed as part of the Court’s files, it
will be their responsibility to limit the disclosure of personal and confidential
information to content which is necessary to dispose of their appeals. It also
goes on to provide a list of proposed sensitive information that parties should
refrain from disclosing in documentation filed with this Court. That list
included the following: personal addresses, social insurance number and
employee identification number, business number, GST/HST account number, sensitive
medical information, birth data except the year, names of minor children and if
identified, only initials should appear and, finally, bank and financial account
numbers and if those are provided only the last four digits of the account.
With the exception of addresses, none of these examples of sensitive
information appeared in the Appellant’s appeal decision, nor are any of those
examples being included in the reasons for this motion. Although this list is
not exhaustive and there are other items that immediately come to mind when
thinking of sensitive information, such as passport numbers, driver’s license
numbers or mother’s maiden name, the content of the Appellant’s decision
contains no such sensitive personal information. Although he did object to the
reference to his travel destinations and dates of that travel in the decision,
the discussion of that information was necessary because the Appellant had
claimed business expenses associated with those trips. He also objected to the
judge’s discussion of the amount of his business income because it made him a
target for criminals. This objection would appear to have no basis as he
reported minimal income in each of the taxation years under appeal which would
likely deter criminals seeing Mr. Pakzad as a desirable target.
[19]
In Singer v Canada (Attorney General),
2011 FCA 3, the Federal Court of Appeal held that an individual’s social
insurance number information contained in Court documents was the type of
personal information that should be protected. Despite this finding, the Court
still held that a confidentiality order would be overreaching in the
circumstances and instead ordered that the sensitive information be redacted. I
reach the same conclusion in respect to the one piece of personal information, Mr.
Pakzad’s addresses, contained in the records. To allow this motion in these
circumstances would dilute the test and expand its application far beyond what
the Supreme Court of Canada intended.
[20]
Turning now to the first branch of the Dagenais/Mentuck
test, the Necessity Requirement requires that the Appellant demonstrate that
there is a serious risk of financial and physical harm to him, his family and
the public that can only be mitigated by the requested publication ban. The Appellant’s
general assertion that unknown and unnamed criminals will target him and his
family using the personal information contained in the appeal and motion
decisions is not well grounded in the evidence. Nor does the evidence support a
conclusion that the alleged risk is a real and substantial risk as contemplated
by the applicable test guidelines. The Appellant has failed to establish a direct
nexus between the risk for identity theft and fraud and the availability of his
decision on this Court’s website. The Appellant did not provide any particulars
about his alleged communications with criminals who obtained information from
the decision, which had been posted on the Court’s website for a short period prior
to the filing of the motion. He simply stated that they were attempting “to
find out more information” about him. (Appellant’s Notice of Motion, dated
March 16, 2017). He did not explain what information these individuals were trying
to obtain, or how that information would have been used to compromise his
financial and personal security, or that of his family, or how there was a risk
to the proper administration of justice. With only unsubstantiated assertions
of risks before me, I have no justification for making any exception to the
open court principle based on the first branch of the Dagenais/Mentuck
test.
[21]
On balance, it appears that the Appellant’s
concerns are purely personal, and that the information he attempts to shield is
related to facts that will be embarrassing to him and his family. Such privacy
interests, however, do not justify non-publication, pursuant to the strict Dagenais/Mentuck
test, such that access by the public should be limited or prevented altogether.
[22]
Before addressing the second branch of this
test, I want to make several comments concerning contradictory statements made
by the Appellant. In his second request for a publication ban by letter dated
June 22, 2016, he indicated that the individuals who had contacted him informed
him that they found him after reading “his name” on the Court’s website. If
that statement is correct, then those individuals may have been accessing the Appellant’s
name as it would be listed on the Court’s website as soon as he filed his Notice
of Appeal in February of 2015. However, in his submissions during the hearing
of the motion, he indicated that those individuals had advised him that they
found him after reading “the trial judgment about him” on the Court’s website.
At one point, I questioned Mr. Pakzad respecting these phone calls that he
alleged he received and he stated that “… I guess he went on your web site”…
(Transcript, page 16, line 10, Emphasis Added). Mr. Pakzad then moved from
“guessing” or assuming that is where they obtained information on him to his
factual statement made shortly thereafter: “Yeah, I said, how do you know these
stuff from? He says, Oh, it’s on the Tax Court web site about you.” (Transcript,
page 16, lines 22 – 24, Emphasis Added). In addition, Mr. Pakzad alleged that
he contacted this Court, prior to filing his appeal, in respect to his ability
to make a non publication request. However, at the time of this alleged
inquiry, he would have had no knowledge of what type of information would be
included in the final reasons of a judge of this Court. If I take Mr. Pakzad at
this word and accept that he did, in fact, make this inquiry prior to filing
his Notice of Appeal, then I can only conclude that his interest in a
publication ban at that preliminary stage must have been motivated primarily by
a desire to protect his personal privacy. If this remained his primary focus in
bringing the motion, as the evidence suggests, it is a purely private concern
which does not engage public interest that would warrant non‑publication.
[23]
Since the Appellant did not meet the first
branch of the test, the motion could be dismissed on this basis alone. However,
even if the Appellant had met the first branch of the test, he has not
satisfied the second branch of the test, the Proportionality Requirement. This
part of the test requires a balancing of the salutary effects of a publication
ban against the deleterious effects. This balancing includes a consideration of
the right to free expression, the right to a fair trial and the efficacy of the
administration of justice. The decision in the Appellant’s appeal is, or at
least was, available on other subscription based databases and has had
commentaries published on free public websites. Ordering a publication ban of
this Court’s decision will be ineffective in providing confidentiality to the
personal information contained in those reasons. His hearing has been completed
and he did not appeal. Further, although the Appellant stated that he had
contacted these websites and that they agreed to delete the decision on those
sites, there was no evidence that they agreed to his request based on proof of
risk of identity theft as opposed to simply following his request. This means
that, even if I were inclined to order a publication ban, it would have little
effect on protecting the Appellant’s personal information. In these
circumstances, there can be very few salutary effects and based on the evidence,
the only benefit that may flow from a publication ban would be the Appellant’s
satisfaction in maintaining his anonymity.
[24]
On the other hand, allowing a ban in respect to
the decision in the appeal, or in this motion, would, however, produce a number
of deleterious effects on the administration of justice and would detract from
the public’s confidence in the integrity of the judicial system, all of which
would be inconsistent with the open court principle. In a self-assessing income
tax system, it is particularly pertinent that the public have access to
decisions of this Court, so that they can better ascertain the state of the law,
particularly as it relates to issues which directly affect their daily
activities. In this case, a discussion of business activities which do not
constitute a source of income for which a taxpayer can claim losses and
expenses may be particularly helpful to a segment of the population in
organizing their own personal matters when engaging in similar activities. This
allows the public to access further clarification and developments in the law
and instills the public’s confidence in the operation of the legal system.
[25]
The Appellant also argued that he had a
reasonable expectation of privacy which he coupled with a fairness argument.
Where the Appellant has failed to satisfy the Dagenais/Mentuck test, he
cannot succeed on this motion. The policy document, “Protecting Your Privacy”
published by Office of the Privacy Commissioner of Canada, which the Appellant
referenced, does not assist him here as it does not apply to this Court’s
decisions or the public’s access to the Court’s proceedings. He also referred
to various statistical studies by the Canadian Anti-Fraud Centre on the
frequency and financial impact of mass marketing frauds in Canada. While these
may be interesting, they do not link such frauds to the content of decisions of
this Court or any other court.
[26]
With respect to the Appellant’s complaint that
the Court did not inform him of the ability to apply for an in-camera
proceeding, the Appellant was represented by legal counsel during the hearing.
If he did have concerns regarding disclosure of his personal information at
that time, he could have, through his counsel, requested an in-camera
proceeding pursuant to section 16.1 of the Tax Court of Canada Act.
Conclusion:
[27]
Most appeals coming before this Court require taxpayers
to divulge some personal information to the extent required to support their
case particularly where they bear the burden of proof. The facts that the Appellant
introduced in open court were deemed necessary and appropriate by him and his
counsel. The trial judge’s discussion of this information and his findings of
fact in respect to the alleged business activities were within the normal
parameters of what would be expected in this type of hearing. The only personal
information that might need to be protected is the Appellant’s address for
which the alternative measure of redacting this information could be
considered. However, where this information is available elsewhere to the
public, granting the relief sought by the Appellant would not be beneficial to
him.
[28]
The Appellant has not convinced me that any of
the information could be used for illicit purposes by criminals. Since he has
not adduced evidence that would satisfy the Dagenais/Mentuck test, I
must dismiss this motion. The Appellant’s desire to shield his privacy cannot
trump the public’s right to an open and accessible court system.
[29]
The Respondent asked for costs of $1,000.00 and pursuant
to the inherent authority set out in Rule 10 of the Tax Court of Canada
Rules, I am awarding that amount to the Respondent payable forthwith. The Appellant
submitted the same request twice before bringing this motion. In the Appellant’s
June 22, 2016 request, he states that if this Court allowed publication then he
warned of the following: “…when it causes any issues for me, then I will
take Legal Actions Against You for Any Damages. And also I will inform
many organizations such as the following that you could have easily prevented
the issue but you would not prevent it.” Again, at the hearing of the motion,
he strongly suggested that I should decide favorably to his arguments or suffer
negative media publicity and other consequences. This also warrants the award
of costs of $1,000.00 to the Respondent.
Signed at Ottawa, Canada, this 18th day of May 2017.
“Diane Campbell”
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