R. v. Dodson

R. v. Dodson Collection Decisions of the Court of Appeal Date 2000-01-12 Docket numbers C31752 Judges Laskin, John Ivan; Feldman, Kathryn N.; O’Connor, Dennis Subject Criminal Decision Content DATE: 20000112 DOCKET: C31752 COURT OF APPEAL FOR ONTARIO LASKIN, FELDMAN and O'CONNOR JJ.A. BETWEEN: ) ) Clayton Ruby and HER MAJESTY THE QUEEN ) Lesli Bisgould ) for the appellants Respondent ) ) - and - ) Gregory Tweney ) for the respondent PATRICIA MARIE DODSON and ) HILMA MARIE RUBY ) ) Appellants ) ) Heard: November 15, 1999 ) On appeal from the sentence imposed by Desotti J. dated February 22, 1999 O’CONNOR J.A.: [1] The appellants pleaded guilty to a charge of breaking and entering and theft arising from the unlawful release of 1500 mink from a mink farming operation in Blenheim, Ontario. Desotti J. sentenced the appellants to 90 days in jail and ordered that they each make restitution to the mink farm in the amount of $34,298.06. In addition, he ordered that each appellant forfeit “any monies held by this court by virtue of a cash bail in partial satisfaction of the restitution order.” [2] On this appeal, the Crown concedes that the sentencing judge did not have the authority to make the forfeiture orders. I agree. The Criminal Code does not authorize an order forfeiting bail money to satisfy a restitution order. Once the appellants had satisfied the conditions in their recognizances, including appearing for their trial, the court had no further interest in the money that had been deposited to secure those obligations. I would therefore quash the forfeiture orders. [3] In addition to seeking to quash the orders forfeiting the bail money, the appellants request this court to order that: (a) the court holding the bail money pay it directly to the individuals who provided the money to enable the appellants to be released from custody rather than to the appellants; (b) the Crown pay the costs of this appeal; and (c) the Crown pay interest on the bail money from the date of the forfeiture orders to the present. [4] For the reasons set out below I would not make any of the three additional orders requested by the appellants. Payment of Bail Money [5] The background for this request is set out in an agreed statement of facts filed on this appeal. The relevant parts provide as follows: 4. After a bail hearing in March and April 1997, the appellants (along with the other three accused) were released on several conditions, one of which was a requirement that $10,000 be deposited with the court on behalf of each of them. Those funds were provided by friends and family members on the appellants’ behalf with the understanding that at the conclusion of the trial, subject to an application for estreat of bail, the money would be returned to each of them. The appellants complied with all terms of their interim release. 6. The issue of ownership of the bail funds was raised at the sentencing hearing in response to the respondent’s request that those funds be forfeited to Ebert Fur Farms Inc. The appellants’ evidence, given by the appellant Dodson, at the hearing, was that the funds deposited on their behalf were not their own, and had been provided on their behalf by others. 7. In fact, on behalf of the appellant, Ruby, $7800 was deposited by her friend, Jan Cejka, and $2200 was deposited by her daughter and son-in-law, Mirian and Jim Corcoran. On behalf of the appellant, Dodson, $10,000 was deposited by her brother and sister-in-law, Richard and Denise Doral. The funds were deposited by Cejka, the Corcorans and the Dorals on the appellants’ assurance to each of them that they would fully comply with all of the conditions of their bail and attend court as required, and on the understanding that the bail funds would be returned to Cejka, the Corcorans and the Dorals once the criminal proceedings were completed. [6] The first question is who in fact deposited the bail money with the court, the appellants or their relatives and friend. The language of the agreed statement of facts is somewhat equivocal. However, both the orders releasing the appellants and s. 515(2)(e) of the Criminal Code under which those orders were made make it clear that it was the appellants who deposited the money with the court. [7] Section 515(2)(e) provides: 515. (2) Where the justice does not make an order under subsection (1), he shall, unless the prosecutor shows cause why the detention of the accused is justified, order that the accused be released … (e) if the accused is not ordinarily resident in the province in which the accused is in custody or does not ordinarily reside within two hundred kilometres of the place in which he is in custody, on his entering into a recognizance before the justice with or without sureties in such amount and with such conditions, if any, as the justice directs, and upon his depositing with the justice such sum of money or other valuable securities as the justice directs. [Emphasis added.] [8] The appellants, who resided in Michigan, were ordered to be released upon entering into recognizances in the amount of $10,000.00, with money deposits. There was no order requiring sureties for these recognizances. [9] A recognizance is a personal acknowledgment by which an accused admits indebtedness to the Crown for a specified sum of money unless the accused satisfies the conditions in the recognizance. If the conditions are satisfied, the matter is at an end; if they are not, the accused becomes a debtor to the Crown for the amount specified in the recognizance.1 Although there may be a number of different conditions in a recognizance, the central condition is always that the accused attend in court as required. [10] A justice may order that a recognizance be with one or more sureties. Sureties are guarantors who agree to be personally responsible to pay the amount specified in the recognizance if the accused fails to satisfactorily perform the conditions set out in the recognizance. As a matter of practice, sureties are required to attend before the justice and execute the recognizance as an acknowledgment to the court of the obligations they have assumed.2 [11] Under s. 515(2)(e) a justice has authority to order that security be deposited with the court either by the accused or if the recognizance is ordered to be with a surety, then by the surety. There is no provision for the deposit of security by a person other than the accused or a surety. [12] The appellants’ relatives and friend were not sureties. They did not sign the appellants’ recognizances. It seems clear that the appellants’ relatives and friend provided the money to the appellants, not to the court, and that the appellants then deposited the money as security in accordance with the terms of the release orders. [13] It also appears that the arrangements relating to the provision of the money and for its return were strictly a private matter between those who provided the money and the appellants. The court was not a party to these arrangements. The appellants did not file an assignment of the bail money. The court’s relationship is with the appellants, and with no one else. [14] Against this background we are asked to order that the bail money be paid by the court directly to the appellants’ relatives and friend. [15] There is no provision in the Criminal Code dealing with the release of money deposited as security under a recognizance nor is there any indication in the recognizances signed by the appellants as to whom the bail money should be paid when the conditions in them have been satisfied. However, it seems obvious that in the normal course money deposited for bail will be returned to the accused or to the surety who deposited it or in those cases where a proper assignment has been filed with the court, to the assignee. The appellants ask this court to make an order that departs from this normal practice. [16] Mr. Ruby, on behalf of the appellants, was candid as to why the appellants seek this order. They are concerned that the mink farm, which was the victim of their offences, either has or will take legal action to seize the bail money before it can be returned to those who provided it to them. Although Mr. Ruby asserts that the mink farm and presumably any other creditors of the appellants do not have a valid claim to the bail money, he seeks the order so that his clients can avoid the additional legal expenses that may be involved in resisting any such claims. [17] Because I am not prepared to make the order, I do not find it necessary to decide if this court has the jurisdiction to do so. However, I have a serious concern whether a sentencing court, or this court when hearing a sentencing appeal, is the appropriate forum for making orders directing to whom bail money should be paid. Presumably, someone who deposits bail money with a court would not seek an order of this kind unless there were competing claims to the money. [18] When there are competing claims, the criminal court is unlikely to have all of the potentially interested parties before it, nor is there a recognized mechanism for bringing those parties to that forum. The rules of practice and procedure in the criminal court are not designed to resolve disputes between competing claimants. There are no provisions for pleadings, discoveries, production of documents, etc. Moreover, criminal courts could become involved in time-consuming inquiries as to the true ownership of the funds used to post bail. Although the present case is said to be unusual because of the order originally sought by the Crown, if this court were to make the order now requested, it may be difficult for criminal courts to decline to consider such orders if requested. [19] When there are competing claims served on the court holding bail money the best course will generally be to resolve those claims by way of an inter-pleader order under Rule 43 of the Rules of Civil Procedure. This was the procedure followed in a case that was recently before this court. In Ontario (Attorney General) v. Petit,3 the accused had been released on $50,000 cash bail. Two creditors of the accused, the Minister of National Revenue and an insurance company with a compensation order, filed writs of seizure with the court where the bail money was being held. After his conviction and sentencing, the accused wrote to the Crown Law Office asking for his bail money back. As a result of the competing claims, the Attorney General brought an application for, and was granted, an order by which the bail money was paid by way of inter-pleader into the Ontario Court (General Division). The issue of the validity of the competing claims was determined at a separate hearing after the affected parties had a full opportunity to develop a proper record and to be heard. Although the accused in that case consented to the interpleader order, there is no reason why this procedure should not be followed in cases where the person who deposits the bail money is not consenting. [20] In any event, I am not prepared to make the order sought because we have no information about whether there are creditors of the appellant who have taken proceedings to seize the bail money. [21] The appellants argue that it does not matter that there may be competing claims because those claims are bound to fail. The bail money, they say, belongs and has always belonged to those who provided it to them. It was provided solely for the purpose of being deposited as bail on the understanding that it would be returned to them after the appellants’ trial. The bail money, they contend, is immune from the claims of any other creditors. [22] This is an interesting argument. The effect of the argument is that those who provide money solely for the purposes of bail to a third party have a superior claim to all creditors of that third party for the return of the money; this is in absence of any security agreement in favour of the persons who provided the money. There appears to be some limited support for this argument in Morris v. Kline4 although, in Morris, it is worth noting that both the individual who supplied the bail money and the individual who sought to seize it were part of the proceedings. [23] However, whether or not this argument is one that will eventually prevail, in my view, is not the question. Assuming that there are creditors asserting claims to the bail money they have a right to be heard and to oppose the order that would eliminate their claims. They have a right to inquire into and challenge the factual basis upon which the order is sought. The creditors, other than possibly the mink farm, have not had notice of this appeal.5 The Latin maxim audi alteram partem is one of the fundamental components of natural justice and provides that individuals who are party to a controversy be given sufficient notice of a hearing and an opportunity to be heard: T.W.U. v. C.R.T.C.6 [24] I recognize that the appellants and perhaps their relatives and friend may be required to incur additional legal expense in persuading another court of the correctness of their argument. This difficulty would only arise if there are in fact competing claims to the money. This prospect, however, does not justify an order preempting the opportunity of those who also claim an interest in the bail money to be heard. A court hearing the proceeding in which the issue is eventually decided will have the authority to make the appropriate cost order. [25] The appellants also argue that the delay in returning the bail money that has resulted from the forfeiture orders and this appeal provides an additional reason for making the order they now request. They say that if the forfeiture orders had not been made, there would have been no opportunity for the creditors to bring proceedings to attempt to seize the bail money. The suggestion of prejudice in this regard is speculative. In any event, if the alleged unfairness to the appellants arising from the delay constitutes a reason for denying an otherwise valid claim by the appellants’ creditors to the bail money, that issue should be addressed in a proceeding in which the competing claims are considered. The court hearing those claims will have the same authority as this court to make the appropriate order and will have the advantage of being in possession of all of the relevant facts. [26] Finally, the appellants argue that if this court does not grant the order requested we will be establishing a precedent that may jeopardize the rights of accused persons to secure bail. They argue that friends and relatives of accused persons will be reluctant to provide money for bail if there is a risk that the money will be exposed to the creditors of the accused. This, it is argued, may make it difficult for an accused to obtain a pre- trial release and may have implications under the Charter. This concern, it seems to me, is largely unfounded. Persons who are prepared to provide bail for an accused and are concerned about avoiding the accused’s creditors can either make the appropriate security arrangements in order that they have a first claim to the bail money or have the accused propose to the justice that they be named as sureties and that they deposit the security directly with the court rather than providing it to the accused. It is difficult to envision circumstances in which a justice would reasonably refuse a proposal of this nature. [27] For the above reasons, I would dismiss the request for the order directing the bail money be paid to the appellants’ relatives and friend. Costs and Interest [28] The appellants seek an order that the costs of this appeal be paid by the Crown on a solicitor and client basis. This request is based solely on the argument that the forfeiture order constituted a violation of the appellants’ rights under ss. 7 and 11(e) of the Charter and that an award for costs for the expense of rectifying that breach is an appropriate remedy under s. 24(1) of the Charter. [29] The appellants argue that the right to “reasonable” bail must include a guarantee that if one posts bail funds and complies with the conditions of the bail order, the money will be returned. The forfeiture order, they say, violated this guarantee. [30] I do not find it necessary to decide whether ss. 7 and 11(e) of the Charter include the right asserted by the appellants nor whether their rights have been violated. In my view, this is not a case in which an order for costs against the Crown is appropriate. I note that the appellants were released from custody pending their trial. There is no suggestion that the anticipation of the forfeiture order created difficulties for the appellants in arranging their pre-trial release. The forfeiture order was stayed pending this appeal and will now be quashed. Although the Crown mistakenly sought and obtained an order to which it was not entitled, there has been no reprehensible conduct on the part of the Crown, no affront to the authority of the court, nor any interference with the administration of justice. I would, therefore, deny the order for costs. [31] Finally, the appellants ask this court to make an order directing the Crown to pay interest at the rate prescribed in the Courts of Justice Act on the bail money for the period from the date of the forfeiture order, February 22, 1999, until the date the money is released by the court. Interest is not ordinarily paid on money deposited as bail. For the same reasons that I would deny the order for costs, I also deny the appellants’ request for the payment of interest. Disposition [32] I would allow the appeal and quash the order of Desotti J. directing that the money deposited as security for the appellants’ recognizances be forfeited. I would dismiss the appellants’ requests for the three additional orders. Released: January 12, 2000 LASKIN J.A. (dissenting): [33] I have read the reasons of my colleague O’Connor J.A. I agree that no costs should be ordered against the Crown and I agree that no interest should be paid on the bail money. I disagree with my colleague, however, on the main issue, whether this court should order that the bail money be repaid to the individuals who provided it so that the appellants could obtain their release from custody pending trial. In my view, this court has the jurisdiction to order that the bail money be returned to these individuals and it should exercise that jurisdiction in this unusual case. [34] The Crown on appeal acknowledges that the trial judge had no jurisdiction to order the forfeiture of the bail money to satisfy the restitution order. Once the forfeiture order is set aside, the question is what is to be done with the money. Although the individuals who provided the bail money for the appellants were not sureties and are not parties to this appeal, this court has jurisdiction to make an order returning the money to them. [35] Mr. Ruby, counsel for the appellants, submits that this jurisdiction resides either in the combined operation of s.683(3) of the Criminal Code7 and s.134(1)(c) of the Courts of Justice Act8 or under the principle of ex debito justitiae, that is in accordance with the requirements of justice. I prefer to rely on the ex debito justitiae principle. Although s.683(3) provides, broadly, that: “A court of appeal may exercise, in relation to proceedings in the court, any powers not mentioned in subsection (1) that may be exercised by the court on appeals in civil matters.…”, this subsection should be read in its context. It likely allows the court to exercise powers incidental to those matters set out in s.683. This, however, is a sentence appeal, governed by s.687 of the Criminal Code, which in contrast to s.686(8), does not by its express terms give the court authority to make “any order, in addition, that justice requires.” On the other hand, this court does have authority to order a remedy to which a person is rightfully entitled, ex debito justitiae. See R. v. Jacobs (1971), 2 C.C.C. (2d) 26 (S.C.C.). The Crown on appeal fairly concedes as much. [36] Moreover, I think that the order sought by the appellants should be made. The agreed statement of facts shows that the bail money did not belong to either appellant. Instead, the money belonged to the appellants’ family and friends. For convenience, I reproduce the relevant paragraphs of the agreed statement: 4. After a bail hearing in March and April 1997, the Appellants (along with the other three accused) were released on several conditions, one of which was a requirement that $10,000 be deposited with the court on behalf of each of them. Those funds were provided by friends and family members on the Appellants’ behalf with the understanding that at the conclusion of the trial, subject to an application for estreat of bail, the money would be returned to each of them. The Appellants complied with all terms of their interim release. 6. The issue of ownership of the bail funds was raised at the sentencing hearing in response to the Respondent’s request that those funds be forfeited to Eberts Fur Farms Inc. The Appellants’ evidence, given by the Appellant, Dodson, at the hearing, was that the funds deposited on their behalf were not their own, and had been provided on their behalf by others. 7. In fact, on behalf of the Appellant, Ruby, $7800 was deposited by her friend, Jan Cejka, and $2200 was deposited by her daughter and son-in-law, Miriam and Jim Corcoran. On behalf of the Appellant, Dodson, $10,000 was deposited by her brother and sister-in-law, Richard and Denise Doral. The funds were deposited by Cejka, the Corcorans and the Dorals on the Appellants’ assurance to each of them that they would fully comply with all of the conditions of their bail and attend court as required, and on the understanding that the bail funds would be returned to Cejka, the Corcorans and the Dorals once the criminal proceedings were completed. [37] Miriam and Jim Corcoran, Jan Cejka, and Richard and Denise Doral provided the appellants’ bail money for one purpose and on one condition. The purpose was to secure the appellants’ release from custody. The condition was that the money would be returned to these individuals at the end of the criminal proceedings, provided the appellants satisfied the terms of their bail, which they did. Why then should the bail money not be returned to its rightful owners? [38] I acknowledge that the money was deposited with the court under s.515(2)(e) of the Criminal Code and that ordinarily bail money deposited under this paragraph would be returned to the accused. But this is not an ordinary case. The question of who should receive the bail money arises before us only because the Crown requested and the trial judge made an order that the court had no jurisdiction to make. I have little doubt that but for this order, the bail money would have been received by the appellants after the criminal proceedings ended and would have been returned to their family and friends. I think that in the interests of justice the court should effect the same result. [39] My colleague declines to make the order requested by Mr. Ruby because of his concern that the mink farm, Eberts Fur Farms Inc. (the beneficiary of the restitution order) or other possible creditors of the appellants may be prejudiced by being denied an opportunity to assert a claim to the money. I do not share this concern. In oral argument, counsel acknowledged that the mink farm was given notice of this appeal and of the Crown’s position that the trial judge had no jurisdiction to order the forfeiture of the bail money in partial satisfaction of the restitution order. Knowing of the appeal and of the Crown’s position, the mink farm apparently chose not to participate in these proceedings or to claim the money. The suggestion that there may be other creditors of the appellants with a claim to the bail money is speculative, and indeed, entirely unsupported by the record. There was no evidence before the trial judge and no indication by the Crown either at trial or on appeal that any person, other than the mink farm, was making any claim to the bail money. Thus, I am not persuaded that repaying the bail money to those individuals who provided it raises any natural justice concern. [40] Moreover, I doubt that Eberts Fur Farms could legitimately lay claim to this money, which by agreement of the Crown did not belong to the appellants. I draw comfort from Morris v. Kline (1922), 68 D.L.R. 222, a decision of the Quebec Superior Court, cited in Houlden and Morawetz, Bankruptcy and Insolvency Law of Canada, 3rd ed., (1993) vol. 2, s. J-13. In that case, an insolvent debtor, who was arrested for defrauding his creditors, borrowed money which he then deposited with the court as bail to obtain his release from custody. His trustee seized the money to satisfy his creditors. Panneton J. held that the seizure was invalid because the money never belonged to the debtor, the accused. He wrote at p.223: the money which the cheque represents never was the property of the insolvent, and as the trustee is invested under a voluntary assignment only with the property of the assignor at the date of the assignment, it would [be] a grave injustice to make the creditors benefit of money which never belonged to their debtor. There was no ground for the seizure made and the action and seizure are dismissed with costs. [41] The present case parallels Morris v. Kline, though no one suggested that the appellants are insolvent. The bail money, however, does not belong to them, and should be exempt from potential garnishment at the hands of their creditors. [42] O’Connor J.A. relies on this court’s recent decision in Ontario (Attorney General) v. Petit9 for the proposition that the best way to resolve competing claims to bail money is by an interpleader order and a subsequent hearing to determine priority. But Petit was a different case. In Petit, the bail money belonged to the accused. He had raised it mainly by selling one of his expensive cars. In the face of competing claims by two of his creditors, interpleader proceedings were appropriate. Indeed, the accused consented to the interpleader order. In the case before us, the bail money does not belong to the appellants and no competing claims have been asserted. [43] Further, refusing to make the order sought raises a larger concern. The bail provisions of the Criminal Code are intended to ensure that accused will be released pending trial if it is safe to do so and it is likely that they will appear for their trial. To further this objective, the amount required for bail should not be set beyond the means of accused or their sureties. Gary Trotter – in his valuable text, The Law of Bail in Canada – calls this a “constitutional imperative”,10 no doubt in reference to s.11(e) of the Canadian Charter of Rights and Freedoms and the Supreme Court of Canada’s judgment in R. v. Pearson (1992), 17 C.R. (4th) 1. In practice, as Mr. Trotter recognizes and as the present case demonstrates, accused persons who are incarcerated will have difficulty raising money for bail without the assistance of family and friends.11 Yet, putting bail money provided by family and friends at risk from claims by an accused’s creditors creates an impediment to bail. I do not find persuasive the suggestion that family and friends can avoid this risk by becoming sureties. They may not want the responsibilities of a surety or they may be unacceptable to the court. Nor do I think that their entitlement to bail money that they have provided should turn on whether they have made appropriate security arrangements. [44] Thus, the larger concern is that refusing the order sought seems inconsistent with the underlying objective of the bail provisions of the Code. This concern is an added reason for making the order requested in this case. How this concern affects the ordinary situation when conditions of bail have been satisfied and the money deposited by an accused is to be returned by the trial court, I leave for a case when it arises directly. [45] I would grant leave to appeal sentence and I would allow the sentence appeal by setting aside the forfeiture order and ordering the release of the bail funds being held by the Ontario Court in Chatham as follows: Funds being held on behalf of the appellant, Hilma Ruby, be released: to Miriam and Jim Corcoran: $ 2,200 to Jan Cejka: $ 7,800 Funds being held on behalf of the appellant, Patricia Dodson, be released: to Edward and Denise Doral: $10,000. Signed: “John Laskin J.A.” _______________________________ 1 Gary Trotter, The Law of Bail in Canada, 2nd Ed. (Carswell, 1999), at p. 246. 2 Trotter, The Law of Bail in Canada, supra, p. 283. 3 (1999), 43 O.R. (3d) 645. 4 (1922), 68 D.L.R. 222 (Que. S.C.). 5 The mink farm was provided with a notice of appeal but not notice of the date of the hearing of the argument. 6 [1995] 2 S.C.R. 781. 7 R.S.C. 1985, c. C-46. 8 R.S.O. 1990, c. C.43. 9 (1999), 43 O.R. (3d) 645 (C.A.). 10 Trotter, The Law of Bail in Canada, 2nd ed. (1999), at p. 252. 11 supra, at pp. 248-49.