Dewdney Transport Group Ltd v. M.N.R.

Dewdney Transport Group Ltd v. M.N.R. Court (s) Database Tax Court of Canada Judgments Date 2003-04-16 Neutral citation 2003 TCC 267 File numbers 2002-4256(EI) Judges and Taxing Officers Leslie M. Little Subjects Employment Insurance Act Decision Content Docket: 2002-4256(EI) BETWEEN: DEWDNEY TRANSPORT GROUP LTD., Appellant, and THE MINISTER OF NATIONAL REVENUE, Respondent. ____________________________________________________________________Appeal heard together with the appeal of Dewdney Transport Group Ltd. (2002-4257(CPP)) on April 10, 2003 at Vancouver, British Columbia Before: The Honourable Judge L.M. Little Appearances: Agent for the Appellant: Narinder Jaswal Counsel for the Respondent: Raj Grewal, Helen Parker ____________________________________________________________________ JUDGMENT The appeal is dismissed and the decision of the Minister is confirmed in accordance with the attached Reasons for Judgment. Signed at Vancouver, British Columbia, this 16th day of April 2003. "L.M. Little" J.T.C.C. Docket: 2002-4257(CPP) BETWEEN: DEWDNEY TRANSPORT GROUP LTD., Appellant, and THE MINISTER OF NATIONAL REVENUE, Respondent. ____________________________________________________________________Appeal heard together with the appeal of Dewdney Transport Group Ltd. (2002-4256(EI)) on April 10, 2003 at Vancouver, British Columbia Before: The Honourable Judge L.M. Little Appearances: Agent for the Appellant: Narinder Jaswal Counsel for the Respondent: Raj Grewal, Helen Parker ____________________________________________________________________ JUDGMENT The appeal is dismissed and the decision of the Minister is confirmed in accordance with the attached Reasons for Judgment. Signed at Vancouver, British Columbia, this 16th day of April 2003. "L.M. Little" J.T.C.C. Citation: 2003TCC267 Date:20030416 Dockets: 2002-4256(EI) 2002-4257(CPP) BETWEEN: DEWDNEY TRANSPORT GROUP LTD., Appellant, and THE MINISTER OF NATIONAL REVENUE, Respondent. REASONS FOR JUDGMENT Little, J. A. FACTS: [1] The Appellant was incorporated under the laws of the Province of British Columbia. [2] The shares of the Appellant are owned by Mr. Ned Jaswal. [3] In 1996 the Appellant was the successful bidder on a five-year contract with Canada Post in the Maple Ridge area of British Columbia. The Appellant also obtained a contract from Canada Post for the Mission area of British Columbia. Each contract with Canada Post provided that the Appellant was to pick up and deliver mail in areas designated by the Post Office. [4] Susan Dunn ("Dunn") was hired by the Appellant to pick up and deliver mail pursuant to the contract that the Appellant had entered into with Canada Post in the Mission area. [5] Dunn used a cargo van owned by the Appellant to pick up and deliver mail. [6] Dunn drove the cargo van for the Appellant from July 17, 2000 to September 14, 2001 when she was terminated because of complaints about her conduct. [7] Dunn maintains that she was advised by other drivers and ex-drivers of the Appellant that she should be at the Mission Post Office at 8:30 - 9:00 a.m. from Monday to Friday. Dunn also stated that specific instructions on the pick up and delivery of mail were outlined on a list in the van. [8] Mr. Jaswal, the President of the Appellant, maintained that Dunn was free to report to the Post Office when she wished. Mr. Jaswal also said that he was unaware of the instructions re the details on the time for picking up and delivery of the mail for Canada Post. [9] Dunn's relationship with the Appellant was outlined in an Agreement dated July 18, 2000 (the "Agreement") (Exhibit A-1). [10] Dunn was paid at a rate of $8.50 per hour. [11] After Dunn was terminated by the Appellant on September 14, 2001 she attempted to obtain benefits under the Employment Insurance Act (the "Act"). [12] In a decision issued on August 22nd, 2002, Mr. Scott Nightingale of the Canada Customs and Revenue Agency stated as follows: It has been decided that Susan Dunn's employment was insurable and pensionable for the following reason(s): The services provided by Susan Dunn were performed under a contract of service. An employer/employee relationship was in effect. The decision in this letter is issued under subsection 93(3) of the Employment Insurance Act and subsection 27.2(3) of the Canada Pension Plan and is based on paragraph 5(1)(a) of the Employment Insurance Act and paragraph 6(1)(a) of the Canada Pension Plan. B. ISSUE: [13] The issue is whether Dunn was employed in insurable employment for the purpose of the Act and whether Dunn was employed in pensionable employment for the purposes of the Canada Pension Plan. C. ANALYSIS: [14] In order to determine if Dunn was an employee of the Appellant I have referred to a number of Court decisions. [15] In Precision Gutters Ltd. v. Canada (Minister of National Revenue), [2002] F.C.J. No. 771, Mr. Justice Sexton, speaking for the Federal Court of Appeal said at paragraphs 15 to 19: 15. ... The four criteria of the four-in-one test are (1) the degree or absence of control exercised by the employer; (2) ownership of the tools; (3) chance of profit; (4) risk of loss (see Mirichandani v. Canada (Minister of National Revenue) [2001] F.C.J. 269 and Wiebe Door Services, supra at p. 5028). 16. The issue has been dealt with more recently by the Supreme Court of Canada in Sagaz Industries Canada v. 67112 Ontario Limited, [2001] S.C.J. No. 61. In that case Mr. Justice Major, speaking for the Court, reviewed the various tests for determining whether a person is an employee or an independent contractor. He agreed with MacGuigan J.A.'s statement of a four-in-one test as set out in Wiebe Door, supra. Major J. said: 47. Although there is no universal test to determine whether a person is an employee or an independent contractor, I agree with MacGuigan J.A. that a persuasive approach to the issue is that taken by Cooke J. in Market Investigations, supra. The central question is whether the person who has been engaged to perform the services is performing them as a person in business on his own account. In making this determination, the level of control the employer has over the worker's activities will always be a factor. However, other factors to consider include whether the worker provides his or her own equipment, whether the worker hires his or her own helpers, the degree of financial risk taken by the worker, the degree of responsibility for investment and management held by the worker, and the worker's opportunity for profit in the performance of his or her tasks. 17. The passage relied upon by Major J. in Market Investigations, Ltd. v. Minister of Social Security, 9 [1968] 3 All E.R. 732 is as follows: The observations of LORD WRIGHT, of DENNING L.J. and of the judges of the Supreme Court in the U.S.A. suggest that the fundamental test to be applied is this: "Is the person who has engaged himself to perform these services performing them as a person in business on his own account?" If the answer to that question is "yes", then the contract is a contract for services. If the answer is "no" then the contract is a contract of service. No exhaustive list has been compiled and perhaps no exhaustive list can be compiled of considerations which are relevant in determining that question, nor can strict rules be laid down as to the relative weight which the various considerations should carry in particular cases. The most that can be said is that control will no doubt always have to be considered, although it can no longer be regarded as the sole determining factor; and that factors, which may be of importance, are such matters as whether the man performing the services provides his own equipment, whether he hires his own helpers, what degree of financial risk he takes, what degree of responsibility for investment and management he has, and whether and how far he has an opportunity of profiting from sound management in the performance of his task. [Emphasis added] 18. Thus Major J. has indicated that the central question to be decided in cases such as these is whether the person who has been engaged to perform the services is performing them as a person in business on his own account or is performing them in the capacity of an employee. In order to make this determination the four criteria set out in Wiebe Door are factors to be considered. 19. While neither Major J. in Sagaz nor MacGuigan J.A. in Wiebe Door completely rejected the "integration test", they did find that it could be difficult to apply. [16] I will comment upon the four factors set out by Mr. Justice MacGuigan in Wiebe Door Services Ltd. v. M.N.R., 87 DTC 5025. Control While Mr. Jaswal maintains that the Appellant did not control the activities of Dunn I do not believe that this is correct. Dunn was trained by ex-drivers of the Appellant and Dunn was, in effect, told what to do by an official of Canada Post pursuant to the contract that the Appellant had entered into with Canada Post. I find in the evidence presented that Dunn was effectively controlled by the Appellant either by employees of the Appellant or by officials of Canada Post with whom the Appellant had entered into a contract. Ownership of Tools The only "tool" in this situation was the cargo van driven by Dunn and owned by the Appellant. Mr. Jaswal testified that the Appellant paid for the fuel, repairs and insurance on the van. It is clear in this situation that the Appellant owned the tools that were used by Dunn. Chance of Profit or Risk of Loss Dunn stated that she was paid by the hour and that she did not share in any profits earned by the Appellant from the contract with Canada Post. Mr. Jaswal suggested that by handling a large number of packages and working longer hours Dunn would earn additional money. In my opinion in this situation Dunn did not have any opportunity to share in the profit or suffer a loss. Conclusion [17] Based on the above tests, I have concluded that Dunn was an employee for the purpose of the Employment Insurance Act and the Canada Pension Plan. [18] The appeal is dismissed, without costs. Signed at Vancouver, British Columbia, this 16th day of April 2003. "L.M. Little" J.T.C.C. CITATION: 2003TCC267 COURT FILE NOS.: 2002-4256(EI) 2002-4257(CPP) STYLE OF CAUSE: Dewdney Transport Group Ltd. and The Minister of National Revenue PLACE OF HEARING: Vancouver, British Columbia DATE OF HEARING: April 10, 2003 REASONS FOR JUDGMENT BY: The Honourable Judge L.M. Little DATE OF JUDGMENT: April 16, 2003 APPEARANCES: Agent for the Appellant: Narinder Jaswal Counsel for the Respondent: Raj Grewal, Helen Parker COUNSEL OF RECORD: For the Appellant: Name: Firm: For the Respondent: Morris Rosenberg Deputy Attorney General of Canada Ottawa, Canada