Date: 20040623
Docket: T-535-03
Citation: 2004 FC 882
Ottawa, Ontario, the 23rd day of June 2004
Present: The Honourable Mr. Justice François Lemieux
BETWEEN:
STEVE GIRARD
Applicant
and
ATTORNEY GENERAL OF CANADA
Respondent
REASONS FOR ORDER AND ORDER
[1] This is an application for judicial review of a decision by the Employment Insurance Commission (the Commission) dated March 10, 2003, denying a write-off of the overpayment of $7,236 in employment insurance benefits received by the applicant, pursuant to section 56 of the Employment Insurance Regulations (the Regulations).
[2] Section 56 of the Regulations states:
| 56. (1) A penalty owing under section 38, 39 or 65.1 of the Act or an amount payable under section 43, 45, 46, 46.1 or 65 of the Act, may be written off by the Commission if (a) the total of the penalties and amounts owing by the debtor does not exceed $5, a benefit period is not currently running in respect of the debtor; (b) the debtor is deceased; (c) the debtor is a discharged bankrupt; (d) the debtor is an undischarged bankrupt in respect of whom the final dividend has been paid and the trustee has been discharged; (e) the overpayment does not arise from an error made by the debtor or as a result of a false or misleading declaration or representation made by the debtor, whether the debtor knew it to be false or misleading or not, but arises from (I) a retrospective decision or ruling made under Part IV of the Act, or (ii) a retrospective decision made under Part I or IV of the Act in relation to benefits paid under section 25 of the Act; or (f) the Commission considers that, having regard to all the circumstances, (I) the penalty or amount, or the interest accrued on it, is uncollectable, or (ii) the repayment of the penalty or amount would result in undue hardship to the debtor. |
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56. (1) La Commission peut défalquer une pénalité payable en application des articles 38, 39 ou 65.1 de la Loi ou une somme due aux termes des articles 43, 45, 46, 46.1 ou 65 de la Loi si, selon le cas : a) le total des pénalités et des sommes dues par le débiteur ne dépasse pas 5 $ et aucune période de prestations n'est en cours pour celui-ci; b) le débiteur est décédé; c) le débiteur est un failli libéré; d) le débiteur est un failli non libéré à l'égard duquel le dernier dividende a été payé et le syndic a été libéré; e) le versement excédentaire ne résulte pas d'une erreur du débiteur ni d'une déclaration fausse ou trompeuse de celui-ci, qu'il ait ou non su que la déclaration était fausse ou trompeuse, mais découle : (i) soit d'une décision rétrospective rendue en vertu de la partie IV de la Loi, (ii) soit d'une décision rétrospective rendue en vertu des parties I ou IV de la Loi à l'égard des prestations versées selon l'article 25 de la Loi; f) elle estime, compte tenu des circonstances : (i) soit que la pénalité ou la somme est irrécouvrable, (ii) soit que le remboursement de la pénalité ou de la somme imposerait au débiteur un préjudice abusif. |
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| 56(2) (2) The portion of an amount owing under section 47 or 65 of the Act in respect of benefits received more than 12 months before the Commission notifies the debtor of the overpayment may be written off by the Commission if (a) the overpayment does not arise from an error made by the debtor or as a result of a false or misleading declaration or representation made by the debtor, whether the debtor knew it to be false or misleading or not; and (b) the overpayment arises as a result of (I) a delay or error made by the Commission in processing a claim for benefits, (ii) retrospective control procedures or a retrospective review initiated by the Commission, (iii) an error made on the record of employment by the employer, (iv) an incorrect calculation by the employer of the debtor's insurable earnings or hours of insurable employment, or (v) an error in insuring the employment or other activity of the debtor. SOR/2002-236, s. 2. |
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56(2) (2) La Commission peut défalquer la partie de toute somme due aux termes des articles 47 ou 65 de la Loi qui se rapporte à des prestations reçues plus de 12 mois avant qu'elle avise le débiteur du versement excédentaire, si les conditions suivantes sont réunies : a) le versement excédentaire ne résulte pas d'une erreur du débiteur ni d'une déclaration fausse ou trompeuse de celui-ci, qu'il ait ou non su que la déclaration était fausse ou trompeuse; b) le versement excédentaire est attribuable à l'un des facteurs suivants : (i) un retard ou une erreur de la part de la Commission dans le traitement d'une demande de prestations, (ii) des mesures de contrôle rétrospectives ou un examen rétrospectif entrepris par la Commission, (iii) une erreur dans le relevé d'emploi établi par l'employeur, (iv) une erreur dans le calcul, par l'employeur, de la rémunération assurable ou du nombre d'heures d'emploi assurable du débiteur,(v) le fait d'avoir assuré par erreur l'emploi ou une autre activité du débiteur. DORS/2002-236, art. 2. |
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[3] On December 14, 2000, the applicant applied for employment insurance benefits, stating that he had stopped working as an ambulance technician at Maison Marc Leclerc (the employer) on November 25, 2000. He also stated in his application that he had worked 80 hours during his last week of work and that his gross earnings for that week were $1,618.51.
[4] A benefit period was established for him effective November 26, 2000, and employment insurance benefits were paid to him.
[5] The applicant worked as an ambulance technician for 80 hours over a seven-day period and was then on leave for a seven-day period, which in his affidavit filed in support of his application for judicial review Mr. Girard describes not as a period of leave but rather a recovery period, as indicated in an article of the collective agreement in effect.
[6] Following the reconsideration on October 1, 2001, the Commission decided that the applicant was not entitled to benefit payments as of November 26, 2000, on the basis that he had received his usual salary during his period of leave.
[7] It was that decision by the Commission which led to the $7,236 overpayment of benefits. Mr. Girard appealed to the Board of Referees, which dismissed the applicant's appeal on July 11, 2002, but strongly recommended that the Commission consider the possibility of writing off the overpayment completely.
[8] The Board of Referees noted that when the applicant went to Employment Insurance he had explained to an officer of the Commission the situation of ambulance technicians and his situation in particular. This officer told him that he was entitled to benefits. The Board of Referees wrote, unanimously:
The information received resulted in an overpayment, which put the claimant in a financially unstable position.
A Whereas the claimant always acted in good faith.
A Whereas he always reported his hours worked.
A Whereas Employment Insurance goes back several months (resulting in a sizeable repayment).
A Whereas the debt caused the claimant considerable harm.
A Whereas the Board of Referees did not change the Commission's decision on the claimant's unemployment status.
The Board of Referees reaches the same conclusion as CUB 52575 concerning the objective of the Employment Insurance program.
Consequently, the Board of Referees unanimously disallows the claimant's appeal and strongly recommends that the Commission reconsider the possibility of writing off the overpayment completely.
[9] On February 13, 2003, Mr. Girard asked the Commission to write-off the overpayment. A few days earlier, he had filled out the Commission's form entitled "[TRANSLATION] Assessment of the Debtor's Financial Situation".
[10] He assessed his gross monthly revenue to be $1,795 with a question mark next to the words "employment insurance" which he added to the form. He wrote $3,338.04 as the total of his monthly expenses.
[11] On March 10, 2003, Doris Morissette, collection officer at Human Resources Development Canada, refused the requested write-off. He relied on the notion of "privation injustifiable" ["undue hardship"]. He states:
[TRANSLATION]
"PRIVATION" ["hardship"]: "Privation injustifiable" means that the claimant's financial situation does not allow him to repay any part of the debt, however limited, without depriving himself of the necessities of life, such as food, clothing, accommodation, medical care and utilities (such as water, electricity and heat) and being unable to meet the repayment conditions of short- and long-term loans for such items as a car, house, furniture or household appliances.
The main factors that led us to take this position are:
1. You receive employment insurance benefits. Therefore, the debt cannot be rescinded.
2. Further, you are employed.
3. You are gradually managing to repay most of your creditors.
Under the circumstances our Minister HRDC can only offer you staggered payments over a longer period in the amount of $100 per month beginning on March 30, 2003, by postdated cheques. . . .
[12] At paragraph 17 of his affidavit supporting his application for judicial review, Mr. Girard writes (applicant's record, page 011):
[TRANSLATION]
17. - On March 10, 2003, the Commission refused to write off my overpayment, not taking into account my immediate financial situation and restricting the notion of "privation injustifiable" to the risk of imminent indigence . . .
[13] Mr. Morissette filed an affidavit in support of the respondent's position. He describes the basis of his decision at paragraph 7 of his affidavit (applicant's record, page 63):
[TRANSLATION]
7- In order to make my decision, I reviewed the applicant's record, including the form Assessment of Debtor's Financial Situation. . . . The following facts emerge from the applicant's record.
• He was receiving employment insurance benefits when the file was under review;
• He also had employment income because he was working on call;
• He was then working part-time and was supposed to get a permanent position in 2003 or 2004;
• The applicant was paying all of his other creditors on a regular basis;
• The overpayment of benefits involved in the Board of Referee's decision was in the amount of $7,236 and will be prescribed as of August 10, 2008.
8- In order to make my decision, I also considered HRDC guidelines for assessing the merits of a write-off application, including . . .
9- After reviewing the applicant's record, I determined that the reimbursement of the overpayment would not cause him "préjudice abusif" ["undue hardship"] and that the amount was not uncollectable.
[14] The applicant raises the following grounds in support of his application for judicial review.
[15] First, Mr. Girard always acted in good faith and the overpayment resulted from receiving the wrong information. These two facts dictated the Board of Referee's recommendation that the Commission write off the overpayment, a recommendation that the Commission disregarded because it was relying only on the applicant's financial situation.
[16] Second, in its decision as well as in the guidelines on which it relied, the Commission likened "préjudice abusif" to the notion of "privation injustifiable", the result of which was that the Commission did not take into account his immediate financial situation.
[17] According to the respondent, the Commission did not err.
[18] He submits that subsection 56(1) of the Regulations confers to the Commission a discretion to write off but makes it subject to a condition precedent whose existence is determined objectively in each of its paragraphs, (a) through (f).
[19] In this case, according to the respondent, it is not only if the applicant establishes the existence of "préjudice abusif" that the Commission is open to exercise its discretionary power.
[20] He concludes in this regulatory context that the applicant's good faith, the reason for the overpayment and the Board of Referee's recommendation are relevant factors for the exercise of the Commission's discretionary power but are not relevant factors for the presence of "préjudice abusif", a notion of fact which can be objectively observed.
[21] The respondent relies on Côté v. Canada (Human Resources Development), [2001] CFPI 924, to support his proposition that the notion of "privation injustifiable" is as broad as that of "préjudice abusif".
[22] I agree with the respondent's submissions for the following reasons, essentially based on my decision in Allard v. Canada (Attorney General), [2001] CFPI 789.
Conclusions
[23] The standard of review on the merits of the Commission exercising its discretionary power to write off is the standard of reasonableness simpliciter but the Commission's decision regarding whether a "préjudice abusif" exists is a question of fact reviewable in accordance with the provisions of paragraph 18.1(4)(d) of the Federal Court Act whose fundamental elements reflect the standard of patent unreasonableness (see Allard, supra, paragraphs 36 to 47 and the decision of the Federal Court of Appeal in Canada (Attorney General) v. Dunham, [1997] 1 F.C. 462).
[24] The structure of section 56 of the Regulations provides a basis for the Commission to exercise its discretionary power to write off only if the existence of the condition precedent, in this case "préjudice abusif", has been established (Allard, supra, paragraphs 30 to 32).
[25] During the hearing, the applicant abandoned his submission that the Commission's decision regarding the existence of the condition precedent, the "préjudice abusif", was patently unreasonable.
[26] The factors which the Commission failed to consider, namely the applicant's good faith, the reasons for the overpayment and the Board of Referee's recommendation, are not relevant to the stage of assessing the existence of the condition precedent.
[27] The notion of "privation injustifiable" is analogous to the notion of "préjudice abusif". That is the finding of Tremblay-Lamer J. in Côté,supra. She writes the following at paragraphs 7 to 11 of her decision:
¶ 7 The applicant submits, first, that the Commission misinterpreted subparagraph 56(1)(f)(ii) of the Regulations, which provides that the Commission may write off a sum that is owing if "the repayment of the penalty or amount would result in undue hardship to the debtor", in requiring that he establish that the repayment of the debt would result in more than undue hardship to him.
¶ 8 According to the applicant, the fact that Parliament chose to change the words "privation injustifiable" to the words "préjudice abusif" clearly indicates that it wanted to alleviate the implications of that subparagraph. He submits therefore that a debtor need not prove that he will be led to undergo serious privations in order to be able to benefit from the write-off of a sum that is owing.
¶ 9 The respondent, for its part, argues that the change by Parliament from the words "privation injustifiable" used in subparagraph 60(1)(f)(ii) of the Unemployment Insurance Regulations to the words "préjudice abusif" in subparagraph 56(2)(f)(ii) of the Regulations was intended only to reformulate the law and not to reform it. I share that opinion.
¶ 10 As mentioned by the respondent, paragraph 44(f) of the Interpretation Act provides:
44. Where an enactment, in this section called the "former enactment", is repealed and another enactment, in this section called the "new enactment", is substituted therefor,
. . .
f) except to the extent that the provisions of the new enactment are not in substance the same as those of the former enactment, the new enactment shall not be held to operate as new law, but shall be construed and have effect as a consolidation and as declaratory of the law as contained in the former enactment; . . .
* * *
44. En cas d'abrogation et de remplacement, les règles suivantes s'appliquent:
. . .
f) sauf dans la mesure ou les deux textes diffèrent au fond, le nouveau texte n'est pas réputé de droit nouveau, sa teneur étant censé constituer une refonte et une clarification des règles de droit du texte antérieur; [...].
¶ 11 I do not think the new language of subparagraph 56(1)(f)(ii) of the Regulations differs as to substance from the previous text of subparagraph 60(1)(f)(ii) of the Unemployment Insurance Regulations, in view of the fact that the words "undue hardship" used in the English version have remained the same since 1971. I conclude, therefore, that the Commission correctly interpreted subparagraph 56(1)(f)(ii) of the Regulations.
ORDER
For all of these reasons, this application for judicial review is dismissed but, under the circumstances, without costs.
"François Lemieux"
Judge
Certified true translation
Kelley A. Harvey, BA, BCL, LLB
FEDERAL COURT
SOLICITORS OF RECORD
DOCKET: T-535-03
STYLE OF CAUSE:
PLACE OF HEARING: Montréal, Quebec
DATE OF HEARING: May 25, 2004
REASONS: The Honourable Mr. Justice Lemieux
DATE OF REASONS: June 23, 2004
APPEARANCES:
Gilbert Nadon FOR THE APPLICANT
Paul Deschênes FOR THE RESPONDENT
SOLICITORS OF RECORD:
Ouellet, Nadon & Associés Avocats FOR THE APPLICANT
Montréal, Quebec
Morris Rosenberg FOR THE RESPONDENT
Deputy Attorney General of Canada
Montréal, Quebec