Denis v. Canada (Minister of National Revenue)

Denis v. Canada (Minister of National Revenue) Court (s) Database Federal Court of Appeal Decisions Date 2004-01-22 Neutral citation 2004 FCA 26 File numbers A-369-03, A-370-03 Decision Content Date: 20040122 Dockets: A-369-03 A-370-03 Citation: 2004 FCA 26 CORAM : RICHARD C.J. LÉTOURNEAUJ.A. NOËL J.A. BETWEEN: FRANCINE DENIS Appellant and THE MINISTER OF NATIONAL REVENUE Respondent Heard at Québec, Quebec, on January 22, 2004. Judgment delivered from the bench at Québec, Quebec, on January 22, 2004. REASONS FOR JUDGMENT OF THE COURT BY: RICHARD C.J. Date: 20040122 Dockets: A-369-03 A-370-03 Citation: 2004 FCA 26 CORAM : RICHARD C.J. LÉTOURNEAU J.A. NOËL J.A. BETWEEN: FRANCINE DENIS Appellant and THE MINISTER OF NATIONAL REVENUE Respondent REASONS FOR JUDGMENT OF THE COURT (Delivered from the bench at Québec, Quebec, on January 22, 2004) RICHARD C.J. [1] This case concerns appeals from two decisions by the Tax Court of Canada (reference: 2003 TCC 304) affirming determinations by the Minister that the appellant's employment during the periods at issue was not insurable as there was a relationship of subordination between the appellant and the payer pursuant to subsections 5(2) and (3) of the Employment Insurance Act (the Act). [2] The appeals to the Tax Court of Canada were heard on joint evidence and these reasons apply to both appeal cases in this Court. [3] In rendering his decision the Minister relied on presumptions of fact, some of which were admitted and others denied by the appellant. [4] At the hearing in the Tax Court of Canada the judge admitted oral and documentary evidence. [5] The function of the Tax Court of Canada judge in an appeal from a determination by the Minister on the exclusion provisions contained in subsections 5(2) and (3) of the Act is to inquire into all the facts with the parties and the witnesses called for the first time to testify under oath, and to consider whether the Minister's conclusion still seems reasonable. However, the judge should not substitute his or her own opinion for that of the Minister when there are no new facts and there is no basis for thinking that the facts were misunderstood (see Pérusse v. Canada (Minister of National Revenue - M.N.R.), [2000] F.C.J. No. 310, March 10, 2000). [6] Counsel for the appellant admitted that the payer and the appellant are de facto spouses, but maintained that this does not constitute a relationship of subordination within the meaning of subparagraph 5(2)(i) of the Act. [7] Paragraph 5(3)(a) of the Employment Insurance Act provides that the relationship of subordination shall be determined in accordance with the Income Tax Act. [8] For 1999 and 2000, paragraph 252(4)(a) of the Income Tax Act provided that the concept of marriage referred to in subsection 251(2) of that Act included a union between de facto spouses. [9] For 2001, following an amendment made to the Income Tax Act, subsection 251(2) of that Act now reads: "For the purpose of this Act, 'related persons', or persons related to each other, are (a) individuals connected by blood relationship, marriage or common-law partnership or adoption . . .". [10] For 2001, a common-law partnership is defined in subsection 248(1) of the Income Tax Act with reference to the definition of common-law partners found in that provision. [11] Accordingly, the judge did not err in law in concluding that, as a result of their common-law union, there was a relationship of subordination between the payer and the appellant within the meaning of paragraph 5(3)(a) of the Act. [12] Based on the oral and documentary evidence, the judge drew the following conclusions of fact: [TRANSLATION] [33] No evidence was submitted to show that the appellant had received a salary, except for certain cheques issued during the period at issue. The appellant explained that her remuneration was paid in cash or by cheque and that the payer had made her a loan which was deducted from her salary. The appellant could not tell the Court what the amount of that loan was and no reference is made to it in the disbursement ledger. On this point, the appellant was not credible. [34] As indicated by the documentary evidence, the appellant made up the books by hand throughout the year: accordingly, she worked for the payer outside the period at issue without charge. The appellant also ran errands for the payer outside the periods at issue without being paid. [35] The payer used the appellant's property during the periods at issue without paying rent in due form for the space occupied for the business. The explanation given by Gérard Lapointe in this regard was that he was paying heating and electricity bills as well as the maintenance charges on the property, but he produced no accounting records to that effect. [36] Unlike the other employees, the appellant was receiving salary advances. Moreover, there was no register of the amounts advanced or of the sum deducted from her paycheques. [13] At the conclusion of his hearing, the judge did not err in finding that the Minister's determination was reasonable since the working conditions would not have been as they were if the appellant and the payer had been dealing at arm's length. [14] The appeals will accordingly be dismissed with only one set of costs, but the respondent will be entitled to disbursements in both cases. "J. Richard" Chief Justice Certified true translation Suzanne M. Gauthier, C Tr, LLL FEDERAL COURT OF APPEAL SOLICITORS OF RECORD DOCKET: A-369-03 STYLE OF CAUSE: FRANCINE DENIS v. THE MINISTER OF NATIONAL REVENUE PLACE OF HEARING: QUÉBEC, QUEBEC DATE OF HEARING: JANUARY 22, 2004 CORAM : RICHARD C.J. LÉTOURNEAU J.A. NOËL J.A. REASONS FOR JUDGMENT RICHARD C.J. OF THE COURT: DATE OF REASONS: JANUARY 22, 2004 APPEARANCES: Alain H. Belzile FOR THE APPELLANT Nathalie Lessard FOR THE RESPONDENT SOLICITORS OF RECORD: Belzile et Associés FOR THE APPELLANT Rivière-du-Loup, Quebec Department of Justice Canada FOR THE RESPONDENT Montréal, Quebec