Date: 20000713
Dockets: 96-1638-UI, 96-1741-UI, 96-1742-UI, 96-1767-UI, 96-1905-UI, 96-2100-UI, 96-2314-UI, 96-2315-UI, 96-2316-UI, 96-2398-UI, 97-1206-UI, 97-1673-UI, 97-1674-UI, 97-510-UI, 97-552-UI, 97-578-UI, 97-579-UI, 97-626-UI, 97-706-UI, 96-1655-UI, 96-1718-UI, 96-2097-UI, 96-2096-UI, 96-2099-UI, 96-2101-UI, 96-2102-UI, 96-2124-UI, 96-2126-UI, 96-2167-UI, 96-2190-UI, 96-2216-UI, 96-2236-UI, 96-2252-UI, 96-2257-UI, 96-2304-UI, 96-2437-UI, 96-2442-UI, 96-2483-UI, 97-119-UI, 97-1204-UI, 97-1465-UI, 97-191-UI, 97-2065-UI, 97-212-UI, 97-213-UI, 97-331-UI, 97-5-UI, 97-520-UI, 97-522-UI, 97-551-UI, 97-670-UI, 97-703-UI, 97-704-UI, 97-993-UI
BETWEEN:
DONNA LEWIS - 96-1638(UI), ELIZA CLEMENTS - 96-1741(UI), ALLAN MCINNIS - 96-1742(UI), PAUL WAITE - 96-1767(UI), JANET W. ARSENAULT - 96-1905(UI), LLOYD LEWIS - 96-2100(UI), KEITH LEWIS - 96-2314(UI), LOMAN MACLEAN - 96-2315(UI), JOHN ARSENAULT - 96-2316(UI), MYLES SMITH - 96-2398(UI), DALE RAFFERTY - 97-1206(UI), WAYNE MILLIGAN - 97-1673(UI), MAUREEN COSTAIN - 97-1674(UI), SANDRA RAFFERTY - 97-510 (UI), PIUS BULGER - 97-552 (UI), ELIZABETH LEWIS - 97-578 (UI), PAUL SHARPE - 97-579 (UI), CARL LEWIS - 97-626 (UI), ELMER LEWIS - 97-706 (UI), CLAUDETTE GALLANT - 96-1655(UI), RODNEY C. MILLIGAN - 96-1718(UI), ALLAN COUGHLIN - 96-2097(UI), NELSON CAMPBELL - 96-2096(UI), MYRA HARVEY - 96-2099(UI), PAULA RAYNER - 96-2101(UI), TERRY SMITH - 96-2102(UI), KEVIN ROBINSON - 96-2124(UI), ROY PARKS - 96-2126(UI), DARREN GAMBLE - 96-2167(UI), CINDY BULGER - 96-2190(UI), SALLY DOUCETTE - 96-2216(UI), RICHARD B. KENNEDY - 96-2236(UI), DALE SIDDALL - 96-2252(UI), VIRGINIA L. KENNEDY - 96-2257(UI), DARRYL MACINTYRE - 96-2304(UI), LORETTA ROSS - 96-2437(UI), ARTHUR C. COUGHLIN - 96-2442(UI), PHILIP BULGER - 96-2483(UI), IVAN LEARD - 97-119 (UI), IVAN BAGLOLE - 97-1204(UI), CHARLES WAGNER - 97-1465(UI), CLARENCE A. BULGER - 97-191 (UI), JUDY WALFIELD - 97-2065(UI), JAMES MACDONALD - 97-212 (UI), LOWELL HUDSON - 97-213(UI), ANGUS A. MCKAY - 97-331 (UI), JUDY A. COUGHLIN - 97-5 (UI), JOHN RAYNER - 97-520 (UI), BERNICE RAYNER - 97-522 (UI), SHAWN PERRY - 97-551 (UI), ROBERT M. ARSENAULT - 97-670 (UI), LINUS BULGER - 97-703 (UI), REBY BULGER - 97-704 (UI), ROGER PALMER - 97-993 (UI),
Appellants,
and
THE MINISTER OF NATIONAL REVENUE,
Respondent.
Reasons for Judgment
A- Unemployment Insurance Act extracts
B- Fishermen's Regulations extracts
C- Fish inspection Act and Regulations extracts
D- Tax Court of Canada Act extracts
A- The facts disclosed by the documentary evidence
B- The witnesses of the Department of Fisheries and Oceans (DFO)
E- The Rulings Officer, Gary Robbins.
B- Quality Management Program (QMP)
C- The common investigation of HRDC and the Rulings Officer
E- The assumptions of the Minister
F- Requirement of Appellants to keep records
VII- Final general conclusions
VIII-Decisions as to individual Appellants
Cuddihy, D.J.T.C.C.
[1] These appeals were heard on common evidence, in Summerside, Prince Edward Island, on January 18 to 22 and 25 to 29, 1999, March 1 to 5 and 9 to 12, 1999, April 6 to 9 and 12 to 16, 1999 November 29 to December 3, 1999, December 6 to 9, 1999 and April 4 and 5, 2000.
I- The appeals
[2] These are appeals from 54 decisions by the Minister of National Revenue (the "Minister") in the years 1996 and 1997, where he determined the insurability and/or the insurable weeks and/or the insurable earnings and of the Appellants (the "Fisherpersons") with Blake Sharbell, Dale Sharbell, partners, Sharbells Fish Mart (the "Payor"), during the years 1992 and/or 1993, pursuant to paragraph 61(3)(a) of the Unemployment Insurance Act (the "Act") and within the meaning of sections 75, 78, 79 and 80 of the Unemployment Insurance Fishermen's Regulations (the "Regulations").
II- The facts in general
[3] In rendering his decisions the Minister relied on the facts and reasons alleged and outlined in the Replies to the Notices of Appeal which are in the Court records and form part of this judgment as if recited at length herein.
[4] In 1992 and 1993 for all the periods of earnings under review it was alleged that Sharbell's Fish Mart (the "Payor") was involved in the purchasing of sea products from fishers in general and the Appellants in particular. The Payor was also involved in the buying and/or selling of fish products in general with other buyers within and/or outside the province of Prince Edward Island and over the counter sales to the public.
[5] The Payor operated in the Portage area of Prince Edward Island.
[6] The Payor paid for purchases from the fishers in cash. The Payor would issue to the fisherpersons pre-numbered, Department of Fisheries and Oceans Canada, purchase slips ("DFO Slips"). These DFO slips were contained in books provided to the Payor by the Department of Fisheries and Oceans (Exhibit R-13). The Payor was required to fill out such a DFO slip for the purchases of fish. The Payor was also required to remit to the Department of Fisheries and Oceans copies of these slips at a designated time period each year.
[7] The Minister alleged that the DFO slips issued by the Payor were not accurate. The Payor was allegedly required by the Department of Fisheries and Oceans Canada to maintain accurate Quality Management Program records or scribblers (the"QMP") of all purchased products of the sea.
[8] Human Resources Development Canada ("HRDC") and the Minister, after conducting an investigation as will be referred to later in this decision, concluded that the QMP records, known and referred to by the Respondent as "daily delivery records" or "scribblers" maintained by the Payor, recorded the purchases made by the Payor from the fisherpersons in general and the Appellants in particular and were to be relied upon to determine the insurability of the Appellants, their insured weeks and their insurable earnings (Exhibits R-1, R-2).
[9] The Respondent decided that certain Appellants did not fish and allowed no earnings for certain periods. The Respondent also decided that certain Appellants were insured persons and allocated earnings to them although they were not in possession of a DFO slip or a record of employment (ROE).
[10] The Appellants denied the allegation that the Payor was required by the Department of Fisheries and Oceans Canada to maintain accurate "QMP" scribblers of all purchases of sea products. They denied that the QMP records maintained by the Payor were accurate. They also denied the allegation that their "DFO slips" were not accurate. They maintained that their DFO slips were the only official documents they would receive when selling their fish. In addition certain Appellants have claimed not to have fished or delivered to the Payor in 1992 and/or 1993.
III- The Law
[11] The following extensive citations are necessary for easy reference and to the benefit in particular to those 30 Appellants who were not represented by counsel.
A- Unemployment Insurance Act extracts
PART III
COLLECTION OF PREMIUMS
INTERPRETATION
Definitions - :
52. In this Part,
"documents" includes money, securities and any of the following, whether computerized or not: books, records, letters, telegrams, vouchers, invoices, accounts and statements (financial or otherwise);
PAYMENT OF PREMIUMS
Records and books
58.(1) Every employer paying remuneration to a person employed by him in insurable employment shall keep records and books of account at his place of business or residence in Canada, or at such other place as may be designated by the Minister, in such form and containing such information, including the Social Insurance Number of each insured person, as will enable any premiums payable under this Act or any premiums or other amounts that should have been deducted or paid to be determined.
(2) Where an employer described in subsection (1) has failed to keep adequate records and books of account, the Minister may require him to keep such records and books of account as he may specify, and the employer shall thereafter keep records and books of account as so required.
(3) Every employer required by this section to keep records and books of account shall retain those records and books of account and every account and voucher necessary to verify the information contained therein until the expiration of six years from the end of the year in respect of which those records and books of account are kept or until written permission for their prior disposal is given by the Minister.
(4) Every employer who is required by this section to keep records and books of account shall, where that employer or an employee thereof is subject to the determination of a question by, or has made an appeal to, the Minister under section 61, retain every record, book of account, account and voucher necessary for dealing with the determination or the appeal until the determination is made or the appeal is disposed of and any further appeal in respect thereof is disposed of or the time for filing any such further appeal has expired.
Inspections
59.(1) An authorized person may, at any reasonable time, for any purpose relating to the administration or enforcement of this Act, inspect, audit or examine any document that relates or may relate to the information that is or should be contained in the records or books of account or to the amount of any premium payable under this Act and, for those purposes, the authorized person may
...
(4) Notwithstanding any other provision of this Act, the Minister may, subject to subsection (5), for any purpose relating to the administration or enforcement of this Part, by notice served personally or by registered or certified mail, require that any person provide, within such reasonable time as is stipulated in the notice,
(a) any information or additional information, including any information return or supplementary return; or
(b) any document.
(5) The Minister shall not impose on any person, in this section referred to as a "third party", a requirement under subsection (4) to provide information or any document relating to one or more unnamed persons unless the Minister first obtains the authorization of a judge under subsection (6).
...
Determination of questions
...
61.(3) Where there arises in relation to a claim for benefit under this Act any question concerning
(a) whether a person is or was employed in insurable employment,
(b) whether a person is the employer of an insured person,
(c) the length of a person's insurable employment, or
(d) the amount of a person's insurable earnings from employment,
an application to the Minister for determination of the question may be made by the Commission at any time and by that person or the employer or purported employer of that person within ninety days after being notified of the decision of the Commission.
(4) Where a question or appeal referred to in subsection (1), (2) or (3) is to be determined by the Minister, the Minister shall notify the employer or purported employer and any person who may be affected by the application and, in the case of an application under subsection (3), the Commission of his intention to determine the question or appeal and shall afford the employer, purported employer, Commission and any person who may be affected by the application, or any of them, as the circumstances require, an opportunity to furnish information and to make representations to protect their interests.
(5) An application for the determination of a question or an appeal for reconsideration of an assessment by the Minister shall be addressed to the Chief of Appeals in a District Office of the Department of National Revenue, Taxation and delivered or mailed to that office.
...
(9) Where the Minister is required to notify a person who may be or is affected by a determination under this section, he may cause that person to be notified, in such manner as he deems adequate, of his intention to make the determination or of that determination, as the case may be.
...
OBJECTION AND REVIEW
...
Effect of decision
71.(1) The Minister and the Tax Court of Canada have authority to decide any question of fact or law necessary to be decided in determining any question or reconsidering any assessment required to be determined or reconsidered under section 61 or 70 and to decide whether a person may be or is affected thereby, and, except as provided in this Act, the decision of the Minister, or the decision of the Tax Court of Canada, as the case may be, is final and binding for all purposes of this Act.
...
Part IV
ADMINISTRATIVE PROVISIONS
Enforcement
...
94.(10) An authorized person may, at any reasonable time, for any purpose relating to the administration or enforcement of this Act other than Part III, inspect or examine any document that relates or may relate to the information that is or should be contained in the records or books of account or to the amount of any benefit payable under this Act and, for those purposes, the authorized person may
...
(13) Notwithstanding any other provision of this Act, the Commission may, subject to subsection (14), for any purpose relating to the administration or enforcement of this Act, other than Part III, by notice served personally or by registered or certified mail, require that any person provide, within such reasonable time as is stipulated in the notice,
(a) any information or additional information, including any information return or supplementary return; or
(b) any document.
(14) The Commission shall not impose on any person, in this section referred to as a "third party", a requirement under subsection (13) to provide information or any document relating to one or more unnamed persons unless it first obtains the authorization of a judge under subsection (15).
...
(19) Where any document is inspected, examined or provided in accordance with subsection (10) or (13), the person by whom it is inspected or examined or to whom it is provided or any officer of the Commission may make, or cause to be made, one or more copies thereof and any document purporting to be certified by the Commission or an authorized person to be a copy made pursuant to this subsection is evidence of the nature and content of the original document and has the same probative force as the original document would have if it were proven in the ordinary way.
(20) No person shall hinder, molest or interfere with any person doing anything that he is authorized to do by or pursuant to this section or prevent or attempt to prevent any person from doing any such thing and, notwithstanding any other Act or law, every person shall, unless he is unable to do so, do everything he is required to do by or pursuant to this section.
...
B- Fishermen's Regulations extracts
PART V
FISHERMEN'S REGULATIONS
Interpretation
74.(1) In this Part,
"buyer" means a person who buys a catch for the purpose of reselling it either in the form in which it was caught or after processing, and not for the purpose of using it as food, feed or bait; (acheteur)
"catch" means any natural product or by-product of the sea or of any other body of water caught or taken by a crew and includes fresh catch, cured catch, Irish moss, kelp and whales but does not include fish scales, and
(a) where only a portion of catch is delivered to a buyer, means the portion delivered, and
(b) where more than one catch or portion thereof is delivered to a buyer at one time, means the catches or portions thereof so delivered; (pêche)
"crew" means any group of fishermen who generally engage in making a catch together or who have actually engaged in making a catch together, and in the case of a single fisherman, "crew" or "member of a crew" as the case may be, means that single fisherman; (équipe)
...
"employer" means a person designated as the employer of a fisherman pursuant to section 76; (employeur)
"fisherman" means a self-employed person engaged in fishing and includes a person engaged, other than under a contract of service or for his own or some other person's sport,
(a) in making a catch,
...
"fresh catch" means a catch that is not a cured catch; (pêche fraîche)
"gear" means any specialized equipment, other than hand tools or clothing, used by a crew exclusively in making a catch. (attirail de pêche)
...
Coverage and Application of Act and Regulations to Fishermen
75. Any person who is a fisherman shall be included as an insured person and, subject to this Part, the Act and any regulations made under the Act apply to that person with such modifications as the circumstances require.
Determination of the Employer of a Fisherman
76. (1) For all purposes of the Act and any regulation made thereunder, the employer of a fisherman shall be the person determined as such in accordance with this section.
(2) Where a catch is delivered in Canada to a buyer or to a buyer's agent by a member of the crew that made the catch and, in a declaration made pursuant to section 82, the members of that crew are declared to share in the returns from the sale of the catch, the buyer shall be regarded as the employer of all fishermen who are members of that crew and who share in such returns.
...
(5) Where it is established to the satisfaction of an officer of the Department of National Revenue, Taxation, that any person required to make a declaration under subsection 82(1) failed to make the declaration or made it falsely, that person shall be deemed to be the employer of all fishermen other than himself who are members of the crew.
(6) Where a person is the employer of the crew by reason only of subsection (5),
(a) section 77 does not apply to him; and
(b) notwithstanding subsection 53(4) of the Act, the person is not entitled to deduct, in any manner from a payment of remuneration to any insured person, premiums paid or payable in respect of the members of the crew.
Records to be Kept by the Employers
77.(1) The records referred to in section 58 of the Act shall contain, for the purposes of this Part,
(a) all particulars required for determining
(i) whether premiums are payable by the employer,
(ii) the earnings of fishermen and the proper allocation and recording thereof, and
(iii) the time of payment of premiums by the employer, and
(b) all particulars that are required to be declared under subsection 82(1).
(2) Every employer shall keep and maintain all books, records, accounts and documents in respect of any fisherman of whom he is the employer separately from those he keeps and maintains in respect of other insured persons.
Determination of Earnings
78.(1) The determination of the earnings of a fisherman shall be made only as provided in this section.
(2) The earnings of a fisherman shall, subject to subsection (4), be the amount paid or payable to him in respect of a catch, after deducting the value of any portion of the catch not caught by the crew of which he is a member, and in accordance with the share arrangement as declared pursuant to section 82.
...
(4) The earnings of a fisherman who is a member of the crew and
(a) is the owner or lessee of the boat or gear used by the crew in making the catch, or
(b) employs other persons who are engaged in making the catch under a contract of service
shall for any week be deemed to be the greater of
(c) the amount obtained by deducting from the gross returns of the catch made by the crew the aggregate of the amounts paid or payable to other members of the crew, the wages paid or payable to persons employed under a contract of service who were engaged in making the catch and twenty-five per cent of the gross returns, and
(d) 20 per cent of the maximum weekly insurable earnings.
Allocation of Earnings
79.(1) The earnings of a fisherman shall be allocated only to weeks as determined pursuant to this section.
(2) Subject to subsection (3) to (5), the earnings of a fisherman from a fresh catch shall be allocated to the week in which delivery of the catch is made.
(3) Where the employer of a fisherman is a buyer of a fresh catch, other than of squid, Irish moss or kelp, and has personal knowledge that
(a) the catch was made on a fishing trip that lasted more than 7 consecutive days,
(b) the person, who regularly each week collects the catches from the crew of which the fisherman is a member, took delivery of a catch in the week next following the week in which he would normally have taken such delivery, or
(c) a particular delivery of lobsters represents more than a week's catch,
he shall with respect to that catch, if that allocation will not result in the earnings of the fisherman in respect of that catch being less than 20 per cent of the maximum weekly insurable earnings, allocate the earnings of the fisherman equally to the week in which delivery is made and the week immediately preceding that week.
(4) Where a fresh catch, other than of squid, Irish moss or kelp, is delivered to a buyer who is the employer of a fisherman who is a member of the crew that made the catch and the employer keeps records sufficient to enable an officer of the Department of National Revenue, Taxation, to determine the period during which the fisherman was engaged in making the catch, the employer shall allocate the earnings in respect of that catch equally among such a number of consecutive weeks that fall either completely or partly during that period as will result in that fisherman's earnings being not less than 20 per cent of the maximum weekly insurable earnings for each of those weeks, the last of those weeks being the week in which delivery is made.
(5) Notwithstanding subsections (3) and (4), where a buyer who is the employer of a fisherman settles his accounts with that fisherman at intervals of more than 7 days and any such settlement is in respect of fresh catches that were delivered over a period of more than 7 days, the aggregate of the earnings for each of the weeks that fall completely or partly in that period in which the earnings of that fisherman are equal to or greater than 20 per cent of the maximum weekly insurable earnings may be allocated by the employer equally among those weeks.
...
(15) Every week to which earnings have been allocated under this section in respect of a fisherman shall be regarded as a week of employment notwithstanding that the fisherman did not work in that week.
Inadequate Records, Computation of Premiums at Five Per Cent
80. (1) Where an officer of the Department of National Revenue, Taxation, is of the opinion that the books, records, accounts and documents of an employer of fishermen are not, in respect of some of the fishermen of whom he is the employer, adequate for the purpose of enabling the officer to determine with reasonable facility the amount of insurable earnings in respect of any period, the premiums payable and the dates on which they were payable or when the premiums were paid by that employer, the officer shall,
(a) in respect of any fisherman for whom such books, records, accounts and documents are in his opinion adequate, determine his insurable earnings and the premiums payable according to the Act and the provisions of these Regulations, other than this section; and
(b) in respect of any fisherman for whom such books, records, accounts and documents are in his opinion inadequate, estimate the insurable earnings in the manner described in subsection (2) and determine the premiums payable to be five per cent of the earnings so estimated.
(2) For the purpose of making the determination described in paragraph (1)(b), the officer referred to in subsection (1) may, in respect of any fisherman referred to in that paragraph, estimate
(a) the period during which any catches of that fisherman were made;
(b) the nature and quantity of any cured catch made during the period referred to in paragraph (a);
(c) the number of fishermen involved in any catch; and
(d) the earnings of each fisherman for each week in the period referred to in paragraph (a).
(3) The aggregate earnings of all fishermen for a period estimated pursuant to subsection (2) shall not exceed the gross returns of all the catches during the period.
(4) An officer of the Department of National Revenue, Taxation, in computing or estimating pursuant to subsections (1) and (2) the total earnings from which the premiums are determined shall exclude therefrom the deduction referred to in paragraph 78(4)(c) if such a deduction is required by that paragraph and any earnings that he is satisfied have been paid or become payable to any fisherman who is not insured or in respect of whom the books, records, accounts and documents are adequate.
(5) Notwithstanding subsections (1) and (2), an officer of the Department of National Revenue, Taxation, may, on the first inspection of the books, records, accounts and documents of an employer who
(a) has not previously been sent a request to keep adequate books, records, accounts and documents,
(b) agrees to keep adequate books, records, accounts and documents,
(c) agrees to make immediate payment of any premiums that the officer, on the basis of oral information or a written declaration, determines are owing, and
(d) has, in the officer's opinion, acted in good faith,
establish in respect of any period the earnings paid or payable to a fisherman employed by the employer during the period on the basis of oral information or a written declaration and determine the insurable earnings and the premiums payable by the employer for the period by applying the provisions of the Act and any regulations made thereunder to the earnings so established.
Declaration to the Buyer
82. (1) The person who delivers a catch in the manner specified in subsection 76(2) shall, at the time of delivery, declare to the buyer or agent the following particulars:
(a) that he is a member of the crew that made the catch;
(b) the names, addresses and social insurance numbers of all fishermen who are members of the crew who share in the returns of the catch and the share arrangement including bonuses or other extra monies;
(c) the portion of the delivered catch, if any, that was not caught by the crew;
...
(e) the names, addresses and social insurance numbers of all persons, if any, employed under a contract of service and the amount of their wages or other remuneration that has been or will be paid in respect of the catch that is being delivered; and
(f) the names of those members of the crew to whom paragraph (2)(a) of the Act applies.
(2) Any person who makes a declaration required by subsection (1) and
(a) knowingly makes a false statement in respect of any particular listed in that subsection;
(b) knowing the correct information in respect of a particular listed in that subsection, fails to declare it, or
(c) where his benefit or premium payments are affected as a result of such declaration, knows the declaration was not made as required and does not immediately inform the Department of National Revenue, Taxation, or the Commission accordingly
shall be regarded as
(d) a person described in section 73 of the Act, and
(e) a person to whom section 63 of the Act does not apply in respect of premiums paid pursuant to the information set out in that declaration.
C- Fish inspection Act and Regulations extracts
1978 CRC ch. 802
FISH INSPECTION ACT
Fish Inspection Regulations
REGULATIONS RESPECTING THE INSPECTION OF PROCESSED FISH AND PROCESSING ESTABLISHMENTS
Short Title
1. These Regulations may be cited as the Fish Inspection Regulations.
Interpretation
2. In these Regulations,
...
"export" means ship from Canada to any other country or from any province to any other province; (exporter)
...
"processing" includes cleaning, filleting, icing, packing, canning, freezing, smoking, salting, cooking, pickling, drying or preparing fish for market in any other manner; (traitement)
...
Registration
SOR/89-375 25 July, 1989
FISH INSPECTION ACT
Fish Inspection Regulations, amendment
P.C. 1989-1405 24 July, 1989
SCHEDULE
1. Subsection 26(1) of the Fish Inspection Regulations is amended by deleting the word "and" at the end of paragraph (d) thereof, by adding the word "and" at the end of paragraph (e) thereof and by adding thereto the following paragraph:
(f) in the case of bivalve molluscs in the shell, the date of processing and the location from which the bivalve molluscs were harvested. "
2. Part I of Schedule II to the said Regulations is amended by adding thereto, immediately after section 14 thereof, the following section:
"14.1 (1) Every owner or operator of an establishment shall keep a record of each delivery of bivalve molluscs, except scallops, to the establishment and the record shall include
(a) the common name of the bivalve molluscs;
(b) the quantity by weight of the bivalve molluscs;
(c) the location from which the bivalve molluscs were harvested;
(d) the date the bivalve molluscs were harvested;
(e) the name and address of the person who harvested the bivalve molluscs;
(f) the date the bivalve molluscs were received by the establishment;
(g) the manner in which and the date the bivalve molluscs were processed in the establishment; and
(h) the name and address of the person to whom and the date the bivalve molluscs were shipped from the establishment.
(2) The record required pursuant to subsection (1) shall be kept
(a) in the case of fresh bivalve molluscs, for a period of one year; or
(b) in the case of frozen bivalve molluscs, for a period of two years. "
Fish Inspection Regulations, amendment SOR/92-75 23 January, 1992 (amended December 17/97 SOR/98-2)
His Excellency the Governor General in Council, on the recommendation of the Minister of Fisheries and Oceans, pursuant to section 3 of the Fish Inspection Act, is pleased hereby to amend the Fish Inspection Regulations, C.R.C., c. 802, in accordance with the schedule hereto, effective February 1, 1992.
SCHEDULE
1.(1) The definition "processing" in section 2 of the Fish Inspection Regulations is revoked.
(2) Section 2 of the said Regulations is further amended by adding thereto, in alphabetical order, the following definitions:
"quality management program" means a program, including procedures, inspections and records, by which the operator of an establishment verifies and documents that the processing of fish in that establishment complies with these Regulations; (programme de gestion de la qualité) (underlining by the undersigned)
"serious contamination" means any condition or deficiency that results, or is likely to result, in an unacceptable risk to the consumer or in tainted, decomposed or unwholesome fish; (contamination grave)"
2. All that portion of subsection 14(3) of the French version of the said Regulations preceding paragraph (a) thereof is revoked and the following substituted therefor:
...
3. Sections 15 to 17[1][2] of the said Regulations are revoked and the following substituted therefor:
"15. (1) The Minister may issue a registration certificate in respect of an establishment where
(a) the establishment meets the requirements set out in Schedule I;
(b) a quality management program has been developed for use in the establishment; and
(c) the establishment's quality management program meets the requirements set out in Schedule VI.
(2) Any operator of an establishment in respect of which a registration certificate has been issued and in which fish is processed for export shall
(a) comply with the requirements set out in Schedules I and II;
(b) implement and comply with the establishment's quality management program;
(c) ensure that the establishment's quality management program meets the requirements set out in Schedule VI;
(d) keep, and make available for inspection by an inspector for a period of not less than three years, detailed records of the inspections and evaluations conducted, or any actions taken, within the establishment pursuant to its quality management program; and
(e) keep up to date and make available to an inspector on request the information and documentation referred to in Schedule VI.
16. A registration certificate is not assignable and expires on the date of expiration indicated in the certificate.
17. The Minister may cancel the registration certificate issued in respect of an establishment where
(a) the establishment has serious contamination;
(b) the establishment is not in compliance with a requirement set out in Schedule I or II;
(c) the establishment's quality management program is not being complied with;
(d) the establishment's quality management program does not meet the requirements set out in Schedule VI;
(e) any information or documentation referred to in Schedule VI is falsified; or
(f) the records referred to in paragraph 15(2)(d) are falsified."
4. The said Regulations are further amended by adding thereto, immediately after section 24 thereof, the following section:
"24.1 Every person who exports fish from an establishment shall keep a record of the name and address of the person to whom, and the date on which, the fish is shipped from the establishment."
5. The said Regulations are further amended by adding thereto, after Schedule V thereof, the following schedule:
"SCHEDULE VI
(repealed April 15, 1999 SOR/99-169)
(Sections 15 and 17)
REQUIREMENTS RESPECTING QUALITY
MANAGEMENT PROGRAMS
1. The quality management program of an establishment shall include the keeping of the following information and documentation;
(a) the name and title of the person responsible for the quality management program at that establishment;
(b) for each applicable control point set out in item 2,
...
(c) in respect of ingredients added to fish during processing,
...
(d) in respect of the packaging materials that are used to package fish,
...
(e) in respect of labels used on packaged fish, a description of the approval process in the establishment with respect to labels;
(f) in respect of all compounds used in the cleaning, sanitizing, lubricating and maintenance of equipment and plant facilities and in pest control,
...
(g) in respect of fish shipped from the establishment, a description of the system used to trace fish to their first destination; and
(h) in respect of retort operations, a description of the training of the persons who supervise those operations.
2. For the purposes of this Schedule, a control point is any one of the following stages in the processing of fish at which the operator of an establishment determines compliance with these Regulations:
(a) the inspection of fish arriving at the establishment for processing;
(b) the inspection of ingredients prior to their addition to fish;
(c) the inspection of fish packaging material prior to its use;
(d) the inspection of labels prior to their application onto packaged fish;
(e) the inspection of cleaning agents, sanitizers, lubricants and pesticides prior to use in the establishment;
(f) the inspection of the construction and maintenance of production facilities and processing equipment;
(g) the inspection of the fish canning process;
(h) the inspection of the retort operations;
(i) the inspection of the cold storage of fish;
(j) the inspection of any other process or operation in the establishment; and
(k) the inspection of fish prior to shipment from the establishment."
D- Tax Court of Canada Act extracts
18.29 (1) The provisions of section 18.14, subsections 18.15(1) and (2), paragraph 18.15(3)(a), subsections 18.15(3.1) to (3.3) and (4), paragraph 18.18(1)(a), section 18.19, subsection 18.22(3) and sections 18.23 and 18.24 apply, with such modifications as the circumstances require, in respect of appeals arising under
...
(b) Parts IV and VII of the Employment Insurance Act;
...
18.15 (4) Notwithstanding the provisions of the Act out of which an appeal arises, the Court, in hearing an appeal referred to in section 18, is not bound by any legal or technical rules of evidence in conducting a hearing for the purposes of that Act, and all appeals referred to in section 18 shall be dealt with by the Court as informally and expeditiously as the circumstances and considerations of fairness permit.
[...]
IV- The burden of proof
[12] The Appellants had the burden of proving their cases. Each appeal however must be decided on the facts particularly established and on its own merits. This subject matter will be discussed in parts VI and VII of this decision.
[13] The Federal Court of Appeal in Attorney General of Canada and Jencan Limited [3] has outlined the principles which must guide the Tax Court when dealing with appeals from discretionary ministerial determinations as follows:
"The decision of this Court in Tignish, supra, requires that the Tax Court undertake a two-stage inquiry when hearing an appeal from a determination by the Minister under subparagraph 3(2)(c)(ii). At the first stage, the Tax Court must confine the analysis to a determination of the legality of the Minister's decision. If, and only if, the Tax Court finds that one of the grounds for interference are established can it then consider the merits of the Minister's decision. As will be more fully developed below, it is by restricting the threshold inquiry that the Minister is granted judicial deference by the Tax Court when his discretionary determinations under subparagraph 3(2)(c)(ii) are reviewed on appeal. Desjardins J.A., speaking for this Court in Tignish, supra, described the Tax Court's circumscribed jurisdiction at the first stage of the inquiry as follows:
Subsection 71(1) of the Act provides that the Tax Court has authority to decide questions of fact and law. The applicant, who is the party appealing the determination of the Minister, has the burden of proving its case and is entitled to bring new evidence to contradict the facts relied on by the Minister. The respondent submits, however, that since the present determination is a discretionary one, the jurisdiction of the Tax Court is strictly circumscribed. The Minister is the only one who can satisfy himself, having regard to all the circumstances of the employment, including the remuneration paid, the terms and conditions and importance of the work performed, that the applicant and its employee are to be deemed to deal with each other at arm's length. Under the authority of Minister of National Revenue v. Wrights' Canadian Ropes Ltd., contends the respondent, unless the Minister has not had regard to all the circumstances of the employment (as required by subparagraph 3(2)(c)(ii) of the Act), has considered irrelevant factors, or has acted in contravention of some principle of law, the court may not interfere. Moreover, the court is entitled to examine the facts which are shown by evidence to have been before the Minister when he reached his conclusion so as to determine if these facts are proven. But if there is sufficient material to support the Minister's conclusion, the court is not at liberty to overrule it merely because it would have come to a different conclusion. If, however, those facts are, in the opinion of the court, insufficient in law to support the conclusion arrived at by the Minister, his determination cannot stand and the court is justified in intervening.
In my view, the respondent's position is correct in law...[4]
In Ferme Émile Richard v. M.N.R., this Court confirmed its position. In obiter dictum, Décary J.A. stated the following:
As this court recently noted in Tignish Auto Parts Inc. v. Minister of National Revenue, July 25, 1994, A-555-93, F.C.A., ... an appeal to the Tax Court of Canada in a case involving the application of s.3(2)(c)(ii) is not an appeal in the strict sense of the word and more closely resembles an application for judicial review. In other words, the court does not have to consider whether the Minister's decision was correct: what it must consider is whether the Minister's decision resulted from the proper exercise of his discretionary authority. It is only where the court concludes that the Minister made an improper use of his discretion that the discussion before it is transformed into an appeal de novo and the court is empowered to decide whether, taking all the circumstances into account, such a contract of employment would have been concluded between the employer and employee if they had been dealing at arm's length.[5]
Section 70 provides a statutory right of appeal to the Tax Court from any determination made by the Minister under section 61, including a determination made under subparagraph 3(2)(c)(ii). The jurisdiction of the Tax Court to review a determination by the Minister under subparagraph 3(2)(c)(ii) is circumscribed because Parliament, by the language of this provision, clearly intended to confer upon the Minister a discretionary power to make these determinations. The words "if the Minister of National Revenue is satisfied" contained in subparagraph 3(2)(c)(ii) confer upon the Minister the authority to exercise an administrative discretion to make the type of decision contemplated by the subparagraph. Because it is a decision made pursuant to a discretionary power, as opposed to a quasi-judicial decision, it follows that the Tax Court must show judicial deference to the Minister's determination when he exercises that power. Thus, when Décary J.A. stated in Ferme Émile, supra, that such an appeal to the Tax Court "more closely resembles an application for judicial review", he merely intended, in my respectful view, to emphasize that judicial deference must be accorded to a determination by the Minister under this provision unless and until the Tax Court finds that the Minister has exercised his discretion in a manner contrary to law.
If the Minister's power to deem "related persons" to be at arm's length for the purposes of the UI Act is discretionary, why, one might ask, does the right of appeal to the Tax Court under section 70 apply to subparagraph 3(2)(c)(ii) at all? The answer is that even discretionary powers are subject to review to ensure that they are exercised in a judicial manner or, in other words, in a manner consistent with the law. It is a necessary incident of the rule of law that all powers granted by Parliament are of an inherently limited nature. In D.R. Fraser and Co. Ltd. v. Minister of National Revenue, Lord Macmillan summarized the legal principles which ought to govern such review. He stated:
The criteria by which the exercise of a statutory discretion must be judged have been defined in many authoritative cases, and it is well settled that if the discretion has been exercised bona fide, uninfluenced by irrelevant considerations and not arbitrarily or illegally, no court is entitled to interfere even if the court, had the discretion been theirs, might have exercised it otherwise.[6]
Lord Macmillan's comments were quoted with approval by Abbott J. of the Supreme Court in Boulis v. Minister of Manpower and Immigration.[7] See also Friends of the Oldman River Society v. Canada (Minister of Transport)[8] and Canada v. Purcell.[9]
Thus, by limiting the first stage of the Tax Court's inquiry to a review of the legality of ministerial determinations under subparagraph 3(2)(c)(ii), this Court has merely applied accepted judicial principles in order to strike the proper balance between the claimant's statutory right to have a determination by the Minister reviewed and the need for judicial deference in recognition of the fact that Parliament has entrusted a discretionary authority under this provision to the Minister.
On the basis of the foregoing, the Deputy Tax Court Judge was justified in interfering with the Minister's determination under subparagraph 3(2)(c)(ii) only if it was established that the Minister exercised his discretion in a manner that was contrary to law. And, as I already said, there are specific grounds for interference implied by the requirement to exercise a discretion judicially. The Tax Court is justified in interfering with the Minister's determination under subparagraph 3(2)(c)(ii) - by proceeding to review the merits of the Minister's determination - where it is established that the Minister: (i) acted in bad faith or for an improper purpose or motive; (ii) failed to take into account all of the relevant circumstances, as expressly required by paragraph 3(2)(c)(ii); or (iii) took into account an irrelevant factor."
[14] The Tax Court in dealing with an appeal under section 80 of the Regulations must undertake a two-stage inquiry.
[15] The Tax Court is justified in interfering with the Minister's determination only if it is established that the Minister exercised his discretion in a manner that was contrary to law. The Tax Court is justified in interfering with the Minister's determination under section 80 of the Regulations by proceeding to review the merits of the determination where it is established that the Minister (i) acted in bad faith or for an improper purpose or motive; (ii) failed to take into account all of the relevant circumstances as expressly required by subsections 80(1) to 80 (5); or (iii) took into account an irrelevant factor.
[16] In other words, what the Court must consider is whether the Minister's decision resulted from the proper exercise of his discretionary authority when he formed his opinion.
[17] It is only where the Court concludes that the Minister made an improper use of his discretion that the Court is empowered to decide whether, taking all the circumstances into account, the Minister erred in his decision to determine the insurable earnings of the Appellants as he did.
V- The evidence
A- The facts disclosed by the documentary evidence
[18] For the comprehension of events which took place and which led to these appeals, I thought it imperative and necessary to outline them, in chronological order, from the available documentation filed by both parties.
[19] On January 19, 1994, HRDC, acting through one of its authorized officers (Joe Pierce), by notice served personally on Edward Sharbell of Sharbells Fish Mart (the "Payor") in Portage, P.E.I. under subsection 94(13) of the Act, required the Payor to provide information for a purpose relating to the administration or enforcement of the Act.
[20] This requirement to provide information by notice (Exhibit (photocopy) R-69) was filed in the Court record on April 15, 1999. The Payor was required to provide, as set out in the request; invoices, weight slips, payroll records, cancelled cheques, bank statements, cash journal, delivery slips and journals for the period of January 1, 1992 to December 31, 1993.
[21] The notice specified that the Payor was given a deadline to provide the information, that is by 4:30 p.m. January 26, 1994. It may be noted that the failure by anyone to comply with this requirement (Exhibit R-69) is a criminal offence under section 20 and subsection 105(1) of the Act.
[22] On December 15, 1994, a document was prepared by N. Small of the accountant office of the Payor, explaining the accounting process of the Payor, as follows (Exhibit B-19, tab. 31):
Sharbell's Fish Mart
Work Summary
Weekly we would receive an envelope containing
DFO Slips and declarations.
Slip containing sales for the week.
Bills for money out - Bills, etc.
List of employees and hours worked.
I would then take the DFO Slips and enter amounts and calculate UIC eligibility amount for week and deduction to take.
The bills would be entered in the journal as well as the sales.
The payroll was entered in payroll book.
At the end of each month the deductions were calculated alone with deductions from fisherpersons and remitted on the 15th of the following month.
The GST was recorded in journal and the quarterly remittances prepared for Dale's signature.
The journal was balanced.
As fishermen finished their seasons the ROE's were prepared.
[23] On January 18, 1995, Lew Stevenson of HRDC certified copies of the QMP scribblers for 1992 and 1993 (Exhibits R-1 and R-2), as it appears from the certification stamp in most of these documents.
[24] On February 20, 1995, a notice to report was signed by Lew Stevenson of HRDC addressed to one of the Appellants, Clarence A. Bulger. Attached to this notice of report was an unsigned document emanating from the office of the Respondent. This Appellant was advised to report to Lew Stevenson of HRDC on March 8, 1995 at Summerside, P.E.I. The order to report and the unsigned document attached to it (Exhibit R-55-1) read as follows:
Employment and Immigration Canada
Notice to report
PLEASE READ ATTACHED
Social Insurance Number
111-370-250
Clarence A. Bulger
RR 1 Box 8000
Portage, PEI Charlottetown, PEI
COB 1WO CIA 8KI
You are directed to report for an interview with Lew Stevenson
At/ Date
Canada Employment Centre Wednesday
8 March 1995
Address Time
243 Harbour Dr., Summerside 12:30 PM
This interview is to obtain information required
by the Commission to determine your entitlement
to unemployment insurance benefits.
Not reporting may result in a denial or suspension
of benefit.
IMPORTANT
If you are unable to report for any reason (for example
you have started working) please telephone 1-800-563-2342
if you are unable to telephone, return this form immediately
showing your reason(s) on the reverse side why you cannot
report. If you are working, give the date of your return to
work and the name and address of your employer.
NOTE
When you report, please bring this notice with you and at least two items of identification such as you social insurance number card, driver's licence, birth certificate, etc.
lm for: L. Stevenson 20-2-95
For manager - Date
INS 3307 (12-92) B
Pursuant to Subsection 41(6) of the Unemployment Insurance Act.
[25] The undated document which was attached to this Appellant's notice to report is as follows:
Revenue Canada Revenu Canada
Customs, Excise and Taxation Accise, Douanes et Impôt
Revenue Canada has been requested to assist Human Resources Development in their investigation of Records of Employment issued by Sharbells Fish Mart. Revenue Canada officers will be available to meet with you at the interview.
Please bring to the interview the following information for the year(s) 1993, 1994, 199 :
1) Copy of personal tax returns for each year, including financial statements.
2) Detailed statement of income, re fish sales, from each fish buyer, recorded on a daily basis for each year.
3) The dates and the amounts that you were paid for the product for each year.
4) Copies of species licenses for each year.
5) Payroll records and Records of Employment issued for any workers you engaged in each of the years.
6) Any other information or documentation you may have to support your insurable earnings from Sharbells Fish Mart. i.e. invoices, receipts etc.
Facs: (902) 368-0248 Télécopieur: (902) 368-0248
94 Euston Street 94 rue Euston
Charlottetown Charlottetown
Prince Edward Island (Île-du-Prince-Édouard)
C1A 8L3 C1A 8L3
[26] The fisherpersons, and the Appellants in particular, were requested to report to HRDC according to the provision set out in subsection 46(1) of the Act. The purpose of the notice to report was to furnish information required by HRDC to determine each Appellant's entitlement to unemployment insurance benefits for the years outlined in the notice. Accompanying the notice to report was a document which the Appellants were asked to read. In this document HRDC indicated that it had requested the assistance of Revenue Canada in the investigation of the records of employment issued to them by the Payor. The Appellants were also made aware that Revenue Canada officers would be available to meet with them at the meeting. They were also requested to bring with them among other information, any documentation to support their insurable earnings. No other Appellants filed such notices to report but no evidence showed that they did not receive same.
[27] On February 28, 1995, the QMP scribblers (Exhibits R-1 and R-2) which appear to only deal with shellfish as opposed to other fish products were received by the Respondent, as one may see by the Revenue Canada Taxation, Charlottetown stamp, which appears clearly enough in Exhibit R-1 on pages 18, 31, 64 and 86 and in Exhibit R-2 on pages l, 6, 27, 44, 61, 79, 98, 125, 143, 164, 185 and 234. This stamp does not appear in Exhibit R-1 at pages 1 or 50 nor in Exhibit R-2 at pages 218 and 245. These scribblers were filed in the Court record on January 18, 1999.
[28] On March 15, 1995, Martin Smith a fisherperson, but also an employee of the Payor who participated in the making of the QMP scribblers, was interviewed by Lew Stevenson of HRDC [In attendance at this interview is Gary Robbins the designated Rulings Officer of the Respondent]. The statement of Martin Smith was filed in the Court records twice (Exhibits A-4 and R-28-10).
[29] On August 1, 1995, Joe Pierce and Lew Stevenson of HRDC interviewed Adrian Doucette one of the Inspection Officers of the Department of Fisheries and Oceans (Exhibit A-6, pp. 13 to 21) who carried out inspections at the Payor's fish mart in 1992-1993. The investigators of HRDC relate to Adrian Doucette what their investigation is showing :
...Mr. Doucette was informed that based on records of employment issued to individual fisherpersons, Sharbel's Fish Mart would have to be receiving and shipping bar clams, clams, quahogs, oysters & eels in amounts greatly in excess of daily delivery amounts as indicated on their records kept for Quality Management Program requirements. We informed Mr. Doucette the only explanation we could see for this was that Sharbel's Fish Mart were not recording the correct amounts of daily product delivered. Mr. Doucette stated that if he discovered a plant was not properly identifying or fraudulently completing Quality Management Program records, he would probably recommend their Registration be suspended. Mr. Doucette stated that he dealt with Dale Sharbell when he went to the plant in 1992/93 to do inspections. ...
[30] On September 6, 1995, (Exhibit R-64, tab. 4, p.1), Gary Robbins, the designated Rulings Officer of the Respondent is assigned six "test files". In his diary on that day which is the first entry for the Sharbell's Project we may read as follows:
"Was assigned 6 "test files", covering 1992 and 1993. Out of these six there were three admissions from the fishermen that the ROE's were false, there were two statements from fishermen that their ROE's were correct and one statement from a fisherman indicating that he wasn't sure if his ROE was correct or not."
[31] On September 12, 1995, Gary Robbins meets with Joe Pierce an investigator of HRDC to determine what records of the Payor are in the possession of HRDC (Exhibit R-64, tab. 4, p. 1).
[32] On September 20, 1995, Gary Robbins meets with Adrian Doucette a Department of Fisheries and Oceans Inspector, who gave a statement to HRDC on August 1, 1995, which may be found in Exhibit A-1, tab.35. Gary Robbins made extensive notes in his diary (Exhibit R-64, tab. 4, pp. 2-4) as follows:
"Met with Adrian Doucette at STC to resume discussion. Began by confirming with him the copy of his statement give to HRD, dated Aug. 1, 1995.
He advised that the main purpose of the QMP was to increase the amount of quality monitoring of all fish species. Prior to the QMP starting, the processing plants had been required to meet DFO regulations. The main difference after QMP was that there was more onus on the plants to monitor their own compliance with the regulations. In addition to making sure that the quality of fish being processed was at an acceptable standard the QMP also provided a method of tracing contaminated product back to the area that it was fished and locating any other fish that was caught at the same time. By being able to track all fish it would be possible to have a "silent recall" in the event that contaminated product was discovered in the marketplace. This recall would allow DFO to locate all the contaminated product without widespread public alarm. Even before QMP became mandatory, around March 1992, records were kept for years by plants that served basically the same purpose. The QMP added consistency and enforceability to the process. The program required plants to keep records on all species that were brought into the plant indicating what area the fish came from, when it was purchased, how inspected, and where and when it was shipped. There was no requirement under the QMP for the plant to document the name of the actual fisherman. The form that the records were in could vary from plant to plant as long as they contained the required information and were approved by DFO. Under QMP requirements plants were to keep records for all species regardless of where the product was sold, whether it was over-the-counter or out of the country. Part of Mr. Doucette's job involved inspecting plants to ensure that each plant in his area kept the required records. All plants were inspected with different frequencies depending on what sort of rating they had for their QMP compliance. Sharbells would have been inspected anywhere from every two weeks to every two months. An inspection consisted of reviewing the QMP records to ensure that Incoming Fish = Final Product. (less a small amount that may be lost during processing). In Sharbells' case this meant matching the amounts recorded in the scribblers (Incoming Fish) to the amounts on the shipping records (Final Product). Mr. Doucette advised that Sharbells kept their records in a filing cabinet in the office in the fish mart. He stated that he usually dealt with Dale Sharbell when doing an inspection but he was not sure who had actually recorded the information in the scribblers, or even if it was all done by just one person. In addition to balancing product received to product shipped an inspection could consist of what is referred to as a recall test. This involved Mr. Doucette picking any a portion of any product in the plant inventory and requiring the plants owner or representative to identify that product by lot number and to use their QMP records to show Doucette what area the product had been fished from. If the plant was unable to do this they would get "Fail" for their QMP rating.
I asked Mr. Doucette if, during his inspections of Sharbells, he ever considered that the amount of product sold by each fisherman/day as indicated on their QMP scribblers seemed to be low, based on his industry knowledge of what would be a normal days catch for a particular species. He stated that his inspection duties didn't require him to note such inconsistencies even if he did happen to see something. He said if he saw a fisherman in the scribblers with low sales he would probably just think they had a poor day fishing.
Mr. Doucette could not provide any reason why, in his opinion, a plant would go to such lengths to purposefully understate their actual purchases and sales on their QMP records. He did say that if, for some reason, a plant did want to record only a portion of its purchases and sales on its QMP records that his inspection process would not pick that fact up. He said that when he does an inspection of a plants QMP records he is assuming that the total amount of product that the plant handles is recorded on those records. As long as the product that is listed on the plants QMP records can be tracked as required then that is usually all he can be concerned about. However if it can be shown that a plant kept only partial QMP records or fraudulent QMP records then that plant could lose its QMP registration which would mean it would be shut down. Therefore while it may not be clear what a plant could gain by falsifying its QMP records it is clear what it stands to lose by doing so.
Mr. Doucette further stated that no part of his inspection involved matching a plants purchases as recorded on its QMP records to that recorded on its DFO slips. He said that DFO slips were not part of the required record keeping for QMP purposes. He also stated that, in some peoples opinion, the information contained on DFO slips is not accurate in all cases.
I questioned him on his previous comment that QMP records were required to be kept for all species that were "brought into the plant". He explained that this referred to any product that was purchased and stored. If a plant bought an amount of any species from a fisherman and took it in to be stored then the plant was required to do a sample quality inspection of the product and record all required information in their QMP records. I asked him if it was possible that a plant could purchase product from fishermen and not actually bring it in for storage but instead sell it directly, as is, to another plant. He stated that while anything was possible, he was not aware of that type of activity happening. If it did take place it would be the responsibility of the second receiving plant to record the necessary information on their QMP records.
Interview was concluded with Mr. Doucette providing me examples of some of the QMP forms that plants could use in their record keeping as well as the QMP Plant Management Handbook used by plants to help them put their initial QMP Plant together. He also showed me the Sharbells QMP Plan, date July 30, 1990, that they submitted for DFO approval. The plant was prepared with DFO assistance and was based on requirements in the Plant Management Handbook. It basically detailed what procedures Sharbells would follow and what records they would keep as far as the QMP. Mr. Doucette stated that he would prefer not to release it since it was an original DFO document. I examined the documents in the plan and advised Doucette that if for some reason I wanted to see it again I would request it. He agreed."
[33] On September 21, 1995, Gary Robbins advises Dale Sharbell of the Payor, that HRDC has forwarded to Revenue Canada records of employment of the Payor for rulings (Exhibit R-64, tab. 4, p. 4). The diary states as follows:
"Called Dale Sharbell at his new location in Summerside, 888-2800. Advised him that HRD has sent ROE's for rulings and requested meeting with him to discuss. He stated that HRD was mistaken when they came across QMP records and thought they were total purchases. He said that QMP was just for contaminated product and if the product was "from good water then there was no QMP". He claimed that info from DFO slips went into journal, which in turn was used to make up the ROE's and T4's, and that was the correct information. He advised that his sister did the books in 1992 until she died, then Doane Raymond took over. Sharbell wanted to delay our meeting until Oct. 3, which is when Byron Murray from Doane Raymond is back from vacation. I told him that his accountant wouldn't be necessary at our first meeting but he insisted that he wanted him there. Tentatively set meeting for Oct.3 at 10:00 AM at Doane Raymond office in Summerside. Sharbell is to set it up with accountants secretary.
Sharbell called back later while I was out at left message that meeting is confirmed."
[34] On September 27, 1995, Gary Robbins speaks with Adrian Doucette (Exhibit R-64, tab. 4, pp. 4 and 5). The diary shows as follows:
"Adrian Doucette returned call. Questioned him again on whether Sharbells would have been required to keep QMP records for all species purchased, regardless if they were fished in contaminated waters or not. He confirmed that they would have had to keep QMP records for anything brought into plant. He went on to explain about a possible procedure that Sharbells may have been operating under during the "spring contaminated season", which goes from May 1 to Aug. 15. He said Sharbells may have been operating under a summer marketing permit or an agreement with DFO which would allow him to purchase contaminated product from fisherman. Doucette stated that Sharbell may even have been operating without any permit or agreement. If he was operating under DFO regulations he would purchase contaminated product but not bring it into his plant. He may possibly grade it for the fisherman near the plant, on the wharf, or wherever. He would then sell it to a registered plant which could purchase and take in contaminated product. The receiving plant would be the one required to keep the QMP records for the product. Sharbell, if he was operating under such a permit, would be required to keep records of where and when product was fished. He would have to supply this info to the registered plant in order for it to be able to keep proper QMP records. Doucette will check his records to determine if Sharbells operated in this manner during 1992 and 1993 and will call back to advise."
[35] On September 28, 1995, Gary Robbins speaks with Adrian Doucette (Exhibit R-64, tab. 4, p. 5). The diary shows as follows:
"Adrian Doucette called back to advise that Sharbells were not involved in 1992 or 1993 in the spring contaminated oyster season under either a permit or a memorandum of understanding. I asked if it was possible that Sharbells had been involved in purchasing contaminated product even without DFO authorization. Doucette stated that to the best of his recollection Sharbells chose not to be involved in that fishery. Instead they wanted only to be in the fall public fishery. Advised Doucette that the '92 and '93 oyster scribblers show some purchases as early as June (Art Smith was the main fisherman). Doucette's response was that there was much confusion and many mistakes made by the plants during the first two years of the QMP and, depending on when he got to a particular plant for an inspection, it could be a few months before problems were identified. He confirmed again that Sharbells were required to have kept QMP records on all species brought into the plant regardless of where or when they were fished. Doucette also mentioned that the purchase of smelts, which takes place over the winter months, make up a large part of Sharbell's business. (The QMP records obtained by HRD contain no record of smelt purchases since they deal only with the periods May 5 to Oct. 30, 1993, and April 19 to Nov. 12, 1992)"
[36] On October 3, 1995, Gary Robbins, the Rulings Officer, meets with Dale Sharbell and Byron Murray, the accountant of the Payor, from the firm of Doane Raymond at Summerside, Prince Edward Island (Exhibit R-64, tab. 4, pp. 5 to 8). The diary states as follows:
"Met with Dale Sharbell and Byron Murray at Doane Raymond Summerside office. Advised Dale that ruling requests were received from HRD along with the QMP scribblers that indicated lower weekly earnings than stated on ROE's.
Dale claimed that the information in the QMP scribblers was not correct. He stated that the information on the DFO slips, on which the ROE's where based, was the accurate information. He stated that DFO started the QMP in 1992 and records were required for all species that were brought into the plant for processing. One purpose of it was to be able to trace back contaminated product to the location where it was fished. He confirmed that DFO gave each plant a rating based on the quality of its QMP record keeping and these ratings determined the frequency of plant inspections. Dale stated that his opinion of the QMP process was that it was more unnecessary paperwork being forced on him for no reason. He stated that he knew the fishermen that he bought from and he had no reason to suspect the quality of the fish that they sold him. This being the case, he did not put much effort into maintaining his QMP records as DFO wished. His 1992 records, for example, do not record the lot numbers that product was shipped out under. As a result the plant received a "C" rating in 1992. He stated that in order to get a better rating in 1993, and to cut down on the "hassle" from DFO, he kept the type of records that DFO wanted to see. They were, however, not an accurate record of his total purchases and sales. He said that the procedure that he used was to take some of his sales or shipping records and, working backwards, break down those amounts to allocate them to individual fishermen in the QMP scribblers. He stated that the names of fishermen that he put in the QMP scribblers had no bearing on who actually sold him the fish. He said sometimes he used names of fishermen who weren't even selling to him at the time. It didn't make any difference whose name the product was under as long as it could be tracked back from his shipping records. By doing this the shipping records that he used would balance with the amounts in the scribblers. He said that this was the type of records DFO wanted to see and as result the plant got an "A" rating in 1993 which, in turn, cut down on DFO inspections. He stated that there was no schedule followed in completing the QMP records. It was done whenever they had time or if a DFO inspection was expected. He said either himself or Martin Smith would complete the records.
I asked him why, if the scribblers were not correct, they contained details such as the SIN's of fishermen, spouse names and SIN recorded on the same page, and comments about "stamps". He had no explanation other than to say maybe Martin Smith did it. I asked him why he would go to all the trouble of keeping false QMP records, and risk the penalties that go with being caught, when he could have easily kept proper records by basing them on the information from his DFO slips, which he claims are correct. His response was that it was easier to make up the information since he didn't always have the DFO slips available when he went to update the scribblers because they had already been sent to accountants. I asked if he could the explain statements from some fishermen who said their ROE is completely false since they never sold any product to Sharbells. His reply was that he has no way of knowing who actually fished the fish that he buys. If someone brings him fish and says it was caught by someone else then how is he to know otherwise. I asked how he explained statements from fishermen who said that their ROE was not accurate, that the number of weeks or the amount of earnings were inflated to suit their purposes. He had no explanation as to why someone would say that. He claimed again that the scribblers were not correct, that all purchases made by the plant were accurately recorded on DFO slips and these were forwarded to Doane Raymond where the ROE's were prepared.
Dale also stated that he did purchase a large amount of oysters during the 1992 and 1993 spring contaminated season. This product would be graded at his plant and the DFO slips were filled out and given to the fishermen. The product was then re-sold to another buyer, i.e. PEI Aqua, who had the necessary leases required to store the oysters. He stated that for these purchases he was not required to fill out any QMP records.
Byron Murray confirmed that information from DFO slips was recorded in a journal with each fisherman having a separate page listing each DFO slip number, date issued, and the dollar amount. He then called in his employee, Nancy, who actually recorded the information to advise what they still had. Nancy stated that some of the journals had been returned to Sharbells but she would still have her copies of the sheets. Also, some of the information has been put on computer and can be printed off. I advised Byron that I would like the DFO information for 1993 calendar year as well as the 1992 and 1993 financial statements. He confirmed that the partnership has its year-end February 28 therefore the Feb. '93 and Feb. '94 financial statements would correspond to those years. Both Byron and Dale stated that January and February were slow times at the plant with the only activity being a "few smelts". I also asked Dale to provide the 1993 shipping records which, according to him, should be "fairly close" to the DFO slip totals. He said that he would locate any shipping records that he still had but that most of the records are still with HRD. He gave me his OK to get his records directly from HRD."
[37] From October 3 to October 23, 1995, the Payor's records in the possession of HRDC are forwarded to the Respondent.
[38] On October 24, 1995, Gary Robbins' diary shows as follows:
"Received records from payors accountant consisting of 1993 and 1994 payroll records (which were not requested) and sheets for individual fishermen detailing dates and amounts of DFO slips. Not all sheets indicate what species each DFO slip was for. There were no financial statements included in the package."
[39] On October 26, 1995, the Respondent is advised by HRDC that the investigators "have prepared additional packages that show how purchases, as stated in the scribblers, track through and match the customs receipts and other shipping records" of the Payor (Exhibit R-64, tab. 4, p. 8).
[40] On November 28, 1995, the Rulings Officer has "completed a review of information provided by HRDC" as well as an analysis of the Payor's original sales receipts books and accountant's ledger sheets for all DFO slips issued by the Payor for 1993 only. The total sales figure that resulted from this break down is approximately $93,000.00 less than the sales figure reported on the Payor's tax return for that period. The product purchases, according to the 1993 QMP scribblers, appear to match with the QMP inspection and shipping records kept by the Payor, which in turn appears to match with the sales figures (both amounts and times). His diary states as follows:
"Completed review of information provided by HRD as well as analysis of payors original sales receipt books and accountants ledger sheets for all DFO slips issued by payor. (all info is for 1993). In the master file is a breakdown of sales on a weekly basis for each species contained in the payors records. The total sales figure that resulted from this breakdown is approx. $93K less than the sales figure reported on the payor's tax return for that period. The product purchased according to the 1993 scribblers appears to match with the QMP inspection and shipping records kept by the payor, which in turn appears to match with the sales figures (both amounts and times).
The payors contention that the DFO slips are the accurate record of purchases was dealt with by an analysis of the accountants' ledger sheets. These sheets list each fisherman's name and the information for each DFO slip they were issued i.e. date, slip number, gross amount, insurable amount. In a small number of cases the sheets also indicated the particular species of fish that the DFO slip was for. It could be determined that there were periods where the total dollar amount of DFO slips issued far exceeded the sales amount for the same period. For example in October 1993, according to the few DFO slips that were identifiable, the payor purchased at least $16239.00 of quahaugs yet his sales for the same period were only $2070.00. During the same month there were at least $65341.00 of oyster purchases according to the DFO slips, yet only $20659.00 in oyster sales. In both cases there were no sales records for after this period to account for the differences, even if the payor would store the product that long before shipping it. These examples demonstrated that the payors' DFO slips are not an accurate record of purchases and could not be used as sole supporting documentation for the Records of Employment." (Exhibit R-64, tab. 4, p. 9)
[41] On November 29, 1995, the Rulings Officer diary states as follows:
"Discussed with Reviewer re difference between sales total on payors' financial statement and the total that I was able to arrive at using all sales invoices provided to date. Agreed that, due to the size of the discrepancy, it needs to be dealt with before we can go ahead and make ruling decisions based on the scribblers. Before that can be done we must attempt to determine what species the additional sales are for and for what time period they fall into. If payor has documentation that proves additional sales which fall in the same period of time that the scribblers cover and for the same species, but are not included in the scribblers, then that would cast enough doubt on the accuracy of the scribblers to prevent them from being accepted.
Met with team leader and Assistant Director re status of project. Agreed that will request additional information from payor. If nothing is provided by payor, within 15 days, to refute the scribblers then we will proceed to complete rulings using scribblers as the basis of any adjustments to the ROE's." (Exhibit R-64, tab. 4, p. 9)
[42] Garry Robbins decided that "additional information will be requested from the Payor and if nothing is provided within 15 days to refute the QMP scribblers, the Respondent will proceed to complete rulings using the QMP scribblers as the basis of any adjustments to the ROE's of the fisherpersons" (Exhibit R-64, tab. 4, p. 9).
[43] On November 30, 1995, the Payor is contacted and requested to produce his financial statements for years ending February 28, 1992 and 1993, the accountant's working papers for these financial statements and weekly break down of sales and purchases for each species in 1992 and 1993 (Exhibit R-64, tab. 4, p. 10).
[44] On December 5, 1995, the Rulings Officer obtains from P.E. Aqua Farms all invoices for 1992, 1993 and 1994 detailing their purchases from the Payor (Exhibit R-64, tab. 4, p. 10), and notes in his diary the following:
"Called Prince Edward Aqua Farms, 886-2220, and spoke to manager Lawrence Cole. Asked him for statement of account detailing oysters purchased from Sharbells over 1992 and 1993. He advised that no statement exists. They paid Sharbells from the invoices they received. He said they have files with all invoices for '92 and '93 that I can pick up to copy if needed. Told him I will be out today for records.
Went to PE. Aqua Farms, met with Laurence Cole, and picked up all invoices for '92, '93, and ‘94 detailing their purchases from Sharbells. Confirmed that no product moved between the two parties other than on the dates and for the amounts listed on the invoices."
[45] On December 6, 1995, the Rulings Officer notes in his diary the following:
"Compared invoices from PE. Aqua Farms to the tracking packages from HRD for 1993 oysters and confirmed no major discrepancies between product purchased according to '93 oyster scribblers and product shipped to PE. Aqua. Returned records to PE. Aqua." (Exhibit R-64, tab. 4, p. 10)
[46] On December 8, 1995, the Rulings Officer notes in his diary the following:
"Was invited by HRDC to attend meeting at HRD Summerside. Also present were Lew Stevenson, Joe Pierce, Dale Sharbell, Byron Murray, and Bernard McCabe (lawyer). Lew advised Dale that the purpose of the meeting was to get his response to a number of questions. He advised Dale that his answers and his cooperation would determine what direction the investigation would take. Lew advised Dale of the possible options that exist for HRD i.e. handling the employer penalty internally or turning the records over to RCMP for criminal prosecution. Before Dale was asked any questions Lew provided them with an overview of the investigation, a summary of the records that were uncovered, and a summary of the interviews, which have resulted in approx. twenty signed admissions of false ROE's.
Byron Murray then indicated that his firm did not conduct an audit of Sharbell's records and therefore would not be able to detect the major discrepancies between actual purchases and the amounts of the DFO slips being issued that HRD was alleging. He stated that as long as the figures showed a reasonable profit margin they would have no reason to suspect anything was wrong. When Lew indicated that the differences between sales and DFO slip totals, for certain periods, were plainly obvious even to someone with no accounting background Murray said that he would have to speak with his employees who actually performed the work before commenting any further.
At this point Bernard McCabe stated that Dale had not made him aware of the magnitude of the investigation re number of files, high dollar amounts involved, and the possibility of criminal prosecution. He wanted time to review the questions that HRD had prepared, and to consult with his client. Lew and Joe told him that hey would not provide him with questions but he could have as much time as needed to speak to his client. The next meeting was set for Dec. 18, 10 am, at HRD S'side." (Underlining by the undersigned)
(Exhibit R-64, tab. 4)
[47] On December 11, 1995, Judy A. Coughlin is interviewed by Joe Pierce and Lew Stevenson of HRDC (Exhibit R-41, p. 38).
[48] On December 14, 1995, the Respondent receives approximately 50 requests for insurability rulings from HRDC on a form which is numbered INS 2216. One of these forms dated December 14, 1995, was filed by the Appellant Janet W. Arsenault (Exhibit A-6, p. 8). The reason for requesting the ruling is as follows:
"Daily delivery records (QMP) kept by Sharbells Fish Mart do not match amounts listed on records of employment issued to fisherpersons. Shipping records do not match with records of employment issued to fisherpersons."
[49] No supporting documents accompanied the request which is initialled B.C. for L.S., which initials stand for Lew Stevenson, Officer of the HRDC.
[50] HRDC asked the following questions: Was the employment of Janet W. Arsenault insurable for the period or periods from 13/6/92 to 29/8/92? Are her earnings of $4,833.00 insurable?
[51] On December 15, 1995, Allan Coughlin, one of the Appellants is interviewed by Lew Stevenson and Joe Pierce of HRDC (Exhibit R-31, p. 24).
[52] On December 18, 1995, the Rulings Officer, Gary Robbins notes the following in his diary:
"Dec. 18- Met at HRD, Summerside, with Joe Pierce, Lew Stevenson, Dale Sharbell, Byron Murray, and Bernard McCabe.
Byron Murray wanted to respond to Lew's comments at last meeting re the obvious differences between sales invoices and DFO slips. Murray advised that he interpreted the remarks to mean that his firm was either incompetent or involved in fraudulent practices. Lew told him he did not mean to imply either. Murray advised that he spoke to his accounting clerk, Nancy, who dealt with Sharbells' account. He provided us with a brief summary, prepared by Nancy, of what the process was that she followed to prepare the ROE's and what information was supplied to her by Dale Sharbell. The summary indicated that Dale would provide Nancy with an envelope weekly containing DFO slips, Declarations, a slip containing sales for the week, any bills, and a list of employees and their hours worked. Nancy would enter the bills and sales in the respective journals. The information from the DFO slips was entered in insurable amounts and deductions calculated. At the end of the season she should prepare the ROE's based on this information. Byron Murray then advised that his firm never received copies of any sales invoices, therefore he would not have been able to compare them to the DFO slips. He stated that the Sales and Purchases figures for the financial statements were taken from the DFO slips and the weekly sales figures Dale gave them.
Lew then answered Bernard McCabe's questions re the scribblers, other QMP records, DFO slips, and ROE's and how they do and do not match to each other. McCabe then stated that, in order to properly advise his client, he would need to review the scribblers and sales invoices. Lew questioned how that would help him but McCabe insisted. He said that shortly after he sees the records that Dale will be prepared to make a statement. Arrangements were then made to provide McCabe with copies of the records. Due to prior commitments on both sides the next meeting will not be able to be held until the first week of January. Lew advised Dale and McCabe that he is not prepared to meet with them again unless Dale is prepared to make a truthful statement re the accuracy of the scribblers. Arrangements were made that if Dale was to make such a statement that McCabe would contact HRD to set a meeting for Jan. 3. If no such statement was going to be made then no meeting would be held. Lew advised them that he will be in touch with Commercial Crime in the meantime in order to get things started for prosecution proceedings in the event that no admission will be forthcoming.
The meeting was then concluded with none of the previously requested financial information being provided by Dale Sharbell or Byron Murray."
(Underlining by the undersigned)
[53] On this day, December 18, 1995, Lew Stevenson of HRDC advises Dale Sharbell and his attorney that he is going to begin prosecution proceedings with Commercial Crime of the RCMP, as was indicated at the December 8, 1995 meeting, in the event that no admission from Dale Sharbell would be forthcoming.
[54] On December 18, 1995, the Rulings Officer, in a telephone conversation with Barb Chandler of HRDC, requests additional 2216's as he will be sending out questionnaire letters in order to begin his rulings when he returns to the office after Christmas"
[55] On December 20, 1995, another telephone conversation takes place between the Rulings Officer and Barb Chandler of HRDC and the following is recorded in the diary (Exhibit R-64, tab.4, p.12):
"Dec. 20- Called Barb Chandler re 2216's. None ready to go yet. She will have some prepared and ready for me to pick up at noon tomorrow so that questionnaire letters can go out this week.
The plan is to rule on ROE's in a consistent manner for both 1992 and 1993 using the scribbler records as the basis of any adjustments. The scribbler records will be used for those periods where the purchases in scribblers track through and match with sales from invoices. There are some weeks, mainly in 1992, where there are more sales than there are purchases recorded in scribblers. For these periods it is obvious that not all purchases are recorded in the scribblers and therefore the benefit of the doubt will be given to any fishermen who have weeks on their ROE's that fit into these periods. This being the case no adjustments will be made to any weeks on a ROE where the scribbler information does not match with the sales information. The payor has been given an opportunity to provide information regarding any additional sales, over and above the invoices we already have, and he has failed to do so."
(Underlining by the undersigned)
[56] These notes indicate that the Rulings Officer is, for a second time, requesting that HRDC sends him requests for rulings.
[57] On December 21, 1995, the diary indicates :
"Dec. 21 - Received additional 2216's yesterday from HRD. Questionnaire letters have now been sent on all 2216's received from HRD, including the original test cases. The total number of 2216's received to date is 107."
[58] On January 2, 1996, a confirmation of a meeting with the Payor for January 3, 1996, is made :
"Jan.2 - Called Lew Stevenson re status of meeting with Dale Sharbell. Lew stated that he was in touch with Bernard McCabe's office and confirmed that meeting is on for tomorrow.
Asked Lew for remaining comparison packages for 1992 speared eels and bar clams. He advised that they are still working on them and will forward as soon as possible."
[59] On January 3, 1996, a meeting is held at the offices of HRDC in Summerside. The diary (Exhibit R-64, tab. 4, p. 13) states as follows:
"Jan.3 - Went to meeting at HRD, Summerside, with Lew Stevenson and Joe Pierce. Bernard McCabe, payor's lawyer, was the only one to show up. He said he knew that Dale wasn't going to be there but had expected Byron Murray to show up. MacCabe gave Lew and Joe a letter stating that the scribblers are inaccurate and incomplete. The letter stated that the scribblers were falsified records made up for the purpose of satisfying DFO's record keeping requirements. The letter went on to say that an analysis of the scribblers could not be completed due to missing information. It indicated that the sheets of paper with the sales figures that Dale sent in to Doane Raymond on a weekly basis are now missing from the records which were returned to Doane Raymond by HRD. It went on to say that, if HRD would provide their questions for Dale in writing, a written reply to them would then be provided.
Both Joe and Lew stated that all records, except for the scribblers, were returned and that, to the best of their recollection, there were no weekly sales sheets provided to them. (Note: Byron Murray stated in our previous meeting that Nancy would enter all info from the sheets Dales sent in into a sales ledger. Therefore even if the actual sheets are not available they should still have the sales ledger with which to conduct their analysis.
Jan. 3- Received an additional package from HRD comparing 1992 eel purchases as listed in the scribblers to the amounts sold according to the sales invoices. The amount of sales exceeds the amount of scribbler purchases by such a large amount that for this species the scribblers cannot be used to make any adjustments to the ROE's.
The final information package needed is for 1992 bar clams and Lew stated it will be ready this week."
(Underlining by the undersigned)
[60] On January 4, 1996, the Rulings Officer advised Barb Chandler of HRDC that he will be proceeding with rulings based on the QMP scribblers, for those periods where the scribblers match sales information. They also discussed the meeting of January 3 mentioned above and it was agreed that final comparison packages would be forwarded to him from HRDC during that week.
[61] On January 5, 1996, the Rulings Officer receives a comparison package from HRDC for 1992 bar clams. The package is unable to show that the purchase amounts from the QMP scribblers (Exhibits R-1 and R-2) match the Payor's sales information for any periods in 1992. The diary (Exhibit R-64, tab. 4, p. 14) shows as follows:
"Jan. 5 - Listed below is a breakdown for 1992 and 1993 showing, for each species listed in the scribblers, which periods that the purchase information in the scribblers match with the information on the sales invoices.
1993
|
Species |
Scribbler purchases match with sales invoices |
Sales invoices exceed scribbler purchases |
|
Oysters |
w/e June 19 - Nov. 27 |
|
|
Quahaugs |
w/e July 3 - Oct. 16 |
|
|
Soft shell clams |
w/e May 8 - Sept. 18 |
|
|
Speared eels |
w/e Apr. 24 - July 3 |
|
|
Netted eels |
w/e Aug. 21 - Oct. 30 |
|
|
Bar clams |
w/e May 8 - June 19 |
w/e June 26 - July 3 |
1992
|
Soft shell clams |
w/e June 6 - July 25 |
w/e Aug. 1 - Sept. 19 |
|
Oysters |
w/e July 18 - Oct. 31 |
w/e Nov. 7 - Dec. 5 |
|
Eels |
w/e Apr. 9 - Oct. 30 |
|
|
Bar clams |
w/e Apr. 25 - Sept. 26 |
Rulings will be completed using the scribblers as the accurate record of fish purchases. For those periods where the sales information indicates that the scribblers are incomplete, the benefit of the doubt will be given to the fishermen, and no adjustments will be made.
For any 2216's received for which no ROE was issued the amounts will be ruled as insurable, unless there is documentation showing that the fisherman refused the earnings as insurable at the time of sale. The rational for this approach is that there are records, such as DFO slips and Doanne Raymond tally sheets, that show it was the payors' practice to record any such refused earnings. Therefore if no records exist to show that sales listed in the scribblers were refused as insurable earnings they will be ruled as insurable." (underlining by the undersigned)
[62] Also, on January 5, 1996, the ruling in the case of Janet W. Arsenault is mailed to her (Exhibit A-6, p. 9) [and rulings decisions were continually sent out to fisherpersons up until the end of March or April 1996 as is indicated in the ruling letters contained in Respondent's Exhibit books pertaining to individual Appellants (Exhibits R-3 to R-7 and R-28 to R-63 inclusively)].
[63] On January 10 and 11, 1996, the investigator of HRDC discusses the first ruling of the Respondent and, as a result, amended rulings were sent out. In particular in the case of Janet W. Arsenault an amended ruling was mailed to her on January 12, 1996 (Exhibit A-6, p.5).
[64] On January 11, 1996, the Appellant Rebby Bulger is advised by HRDC that a request was made to the Respondent to determine her earnings (Exhibit R-63-2).
[65] On January 29, 1996, a second Rulings Officer is assigned to assist Gary Robbins.
[66] On January 31, 1996, we see the last entry of the Rulings Officer in the diary (Exhibit R-64, tab. 4, p. 15) as follows:
"Jan. 31 - Discussed with a fellow rulings officer the fact that, in cases where there are no sales listed for a person in the scribblers, we are ruling them as an insured person pursuant to S 75 of the UIR's with zero insurable earnings. It was his opinion that this was not the proper section to be quoting and he suggested I call Lloyd MacKay in H.O. for clarification.
I called Lloyd and discussed the above mentioned situation. It was his opinion that it was proper to quote S 75 in these situations. He did however suggest that I check with Appeals to ensure that whatever approach we are taking is consistent with that taken by them on the Carr's files.
I then discussed this with the rulings officer who did the Carr's files and confirmed that this was the procedure used on those files (re using S 75 to rule someone as an insured person who has no insurable earnings). It was also brought to my attention that in those files the total amount of insurable earnings was quoted under S 3 of the UICPR's. I then checked with two Appeals officers who worked on the Carr's files and was informed that they also used S 75 to rule in someone with no insurable earnings. Instead of using S 3 of the UICPR's to determine the insurable earnings they quoted S 78(4) of the UIR's.
Therefore we will continue to quote S 75 UIR's as it as previously been used. We will however in future use S 78(4) UIR's to determine total insurable earnings instead of S 78(2) as was previously used. (underlining by the undersigned)
[67] On February 6, 1996, Dale Siddall is interviewed by the investigators of HRDC (Exhibit R-54, p. 51). Paul Waite is interviewed by Lew Stevenson and Joe Pierce of HRDC (Exhibit R-15).
[68] On February 14, 1996, Joe Pierce of HRDC forwards a memorandum to the Rulings Officer, Gary Robbins, in the case of Wayne Milligan. He states:
"The bar clams for 1993 have been accounted for and are accurate with the exception of 913 lbs received and shipped on the 3rd of July 1993. This person does not appear on the Daily Delivery Records for 1993. Where do the 2 insured weeks come from?"
[69] On February 22, 1996, the Rulings Officer, Gary Robbins advises Joe Pierce of HRDC as follows (Exhibit B-9, tab. 6):
"Why these 2 weeks and not all 9 on the ROE?
Joe, the 93 QMP bar clam scribbler is not a complete record for the week ending June 26 & July 3, therefore no change to any ROE for that period. The other 7 weeks were ruled out because they were for soft shell clams."
[70] On February 29, 1996, Lynn Loftus, one of the Appeals Officer of the Respondent is assigned nine or ten files of fisherpersons who are appealing the rulings. She outlines briefly in her diary (Exhibit R-64, tab. 12) the sequence of events at her level. She testified at the hearing. She met with Walter MacDonald, the Chief of Appeals and Gary Robbins the Principal Rulings Officer.
[71] On March 1, 1996, Lynn Loftus the Appeals Officer began her interviews with the fisherpersons.
[72] On March 6, 1996, Bernard McCabe, the lawyer of Dale Sharbell, requests a delay in preparing the Payor's questionnaire. He also advises the Respondent of the position of his client as to the DFO slips and other records. The diary of Lynn Loftus (Exhibit R-64, tab. 12, p. 2) reads as follows:
"March 6/96: Bernard McCabe called. He is Dale Sharbell's lawyer. He stated they may have some difficulty in completing the questionnaire without contacting his accountant. It is the busy time of year for accountants and they may not get the questionnaire back to me within 10 days as requested. I advised lawyer that Walter MacDonald, Chief of Appeals, and I would like to meet with Mr. Sharbell and go over the whole matter in person. Bernard agreed it would be a good idea. I stated I did not have a phone number where I could reach Mr. Sharbell and he stated it was for a good reason and he wasn't going to be able to provide it. I advised him to contact client and try to set up a meeting so we could proceed. He agreed.
Mr. McCabe then said that he wanted to go on record with what Mr. Sharbell wanted us to know. The DFO slips were the only accurate records of purchases. He stated they were made up at the time of the sale by the fisherman. The other records were completed only to satisfy Fisheries officials and meant nothing at all as far as the purchases of fish went. I advised Mr. McCabe that I would have to discuss the matter with Mr. Sharbell and that we needed some concrete proof that something in the records could be relied upon as there were many, many discrepancies in the various reports and statements made by everyone. He agreed and said he would contact Mr. Sharbell and see if we can set up a meeting.
[73] March 7, 1996, one of the Appellants, Donna Lewis, contacted Lynn Loftus. The situation is best described by the notes in her diary (Exhibit R-64, tab. 12, p. 2):
"March 7/96: Donna Lewis (an Appellant) called on behalf of a group of fishermen. She is acting as a spokesperson for several people in her area. Ms. Lewis stated there was confusion as to when they are supposed to file their appeals as the form states it is after they receive notification by HRDC and someone said it was the notification by RCT. I advised her this is a transition period and she could advise (her husband among others) fishermen she was representing to file the appeal when they received the letter from RCT but they would not be penalized if the waited until they got the HRDC letter and filed within 90 days of the date of that letter. Ms. Lewis stated several of the fishermen had been advised by Summerside HRDC that the letters from HRDC may not go out until mid to late April and the 90 day appeal period would be elapsed for RCT letters from some. Ms. Lewis stated they (fishermen) had met last evening in Ellerslie regarding the appeals."
[74] On March 15, 1996, the completed questionnaire of Dale Sharbell is received by the Respondent (Exhibit R-8, tab. 3, pp. 8 to 11).
[75] On March 26, 1996, a meeting is held in Summerside with Dale Sharbell, his lawyer Bernard McCabe, Lynn Loftus, the Appeals Officer and Walter MacDonald the Chief of Appeals. The diary (Exhibit R-64, tab. 12, pp. 4, 5 & 6) speaks for itself as follows:
"March 26/96: To Summerside to meet with Dale Sharbell and Bernard McCabe, lawyer, me and Chief of Appeals. (Walter MacDonald)
Discussed the situation with the QMP. Mr. McCabe stated that the payor has been saying over and over again that the QMP records are contrived and cannot be accepted as accurate. He also stated that the accurate records are the DFO slips. The questions were responded to by both the payor and the lawyer.
Question: When did you prepare and give the DFO slips to fisherman? Did you prepare one for the week, no matter how many sales; or did you prepare one for each sale?
A: It would depend on what they wanted. Mostly I would just do one for the week. If they wanted one every time, I gave it to them. In 1993, they had to sign a declaration every time they sold to me. It was just as easy to do the DFO slip then.
Question: What records do you have of daily fish purchases and sales?
A: The DFO slips are an accurate record of fish purchases. They were taken to Doanes every week Nancy Small would make a tape of them. These records went to the UI office and when they came back, they didn't have the tapes on them any more.
The amounts shown in the books and on the income tax returns accurately reflect the purchases and will be found to agree with the DFO slips.
Question: How do you explain names found in the QMP scribbler when people claim they did not fish?
A: The records were created to agree with the shipping records. The payor stated that he would take the shipping records and would know how much fish went out and needed to be recorded in the QMP records. He would then take the lists made available to anyone from DFO showing who licensed fishermen were for each species. He would chose a name from the list and record sales to that particular fisherman if he knew that they might fish a certain area. It didn't matter whether they sold to him or not as long as he recorded the area and the amount of fish purchased.
Question: Did you purchase fish from fishermen who did not want DFO slips?
A: No. If they didn't want a stamp, it was written on the slip.
Question: Did you give DFO slips in other people's names or make them up to agree with purchases?
A: No. The DFO slips are truthful.
Question: Were there any sales not included in QMP?
A: Yes. The fish used as bait is not in the scribbler; sales made over the counter; contaminated fish; fish sent to other plants for processing in PEI (French River Cannery, for example); fish they processed themselves.
QMP records had to reflect the actual shipping records for fish sent to U.S. or Europe; shipped to other provinces; and smelts they processed themselves.
Question: When did you actually record the entries in the scribbler?
A: The scribblers were updated sometimes on the same day; sometimes a week or so later or a couple of weeks later. ...whenever I knew the fisheries officer was coming. I took the shipping records and worked backward. I sometimes made them up when I was shipping. I never made them up when I was buying.
Question: Did anyone ever do a volume analysis...fish in pounds in to fish in pounds out?
A: I don't know."
Question: What records do you have of the number of pounds you bought and sold?
A: The DFO slips would have the actual amount of fish bought. The amount of pounds would be on the weekly sales records and they might be available. Will check with the accountant.
Question: How many copies are there of DFO slips?
A: 4, I think. One for the fisherman; one for me that I took to the accountant; and two for the fisheries--one federal and one provincial.
Through further discussion with the Chief of Appeals, the payor agreed to provide us with any records we may require to do the volume analysis. The lawyer suggested we might get the accountant to do this. However, we decided we would try to get the DFO slips from Fisheries if they are available and do our tape. The payor or his accountant could do a tape of the purchases as shown in the records, and we could follow through after that. There should be little or no discrepancies noted (spoilage; etc.) and the amount of the species purchased per DFO slips should agree with the amounts of species recorded at accountant's office. This is lend credibility to the DFO slips or will prove they are not correct.
Problem: If the payor had the DFO slips and had just purchased product from fishermen, what was the reason he would have to create names for the QMP?
Question: Did you ever buy product from people who didn't have a license to fish a particular species?
A: I don't think so.
Question: Well why not use the right names?
A: Sometimes the DFO slips would already be at the accountant's and I wouldn't have them, so I would write in someone's name from the licence list that I knew had fished in the same area as the lot number was and put them down.
PLAN:
CONTACT DFO AND ASK
IF WE CAN SEE THE DFO SLIPS FOR 1992-93.
ARE THESE SLIPS IN SPECIES ORDER?
HOW OFTEN DFO SLIPS ARE COLLECTED OR SENT TO DFO?
IF THE PAYOR RECORDED DIFFERENT NAMES ON DFO SLIPS
AND QMP RECORDS, WHAT WOULD BE THE CONSEQUENCE?
WHAT WAS THE METHOD OF INSPECTION?
WOULD IT BE POSSIBLE TO MAKE UP THE QMP FROM SHIPPING RECORDS?
LAWYER TO CONTACT BYRON MURRAY, ACCOUNTANT AND SET UP MEETING FOR WALTER AND ME."
[76] On March 29, 1996, Lynn Loftus requests information from the Department of Fisheries and Oceans. She speaks with Don Love of the Inspection Branch and Shane MacIsaac of the Statistics Branch. She informs them that she wishes to carry out a volume analysis from the statistics kept by the Department of Fisheries and Oceans.
[77] On April 4, 1996, Lynn Loftus is advised by the Statistics Branch in Moncton that the easiest way of releasing the information is to obtain a written authorization from Dale Sharbell, which she did.
[78] On April 11, 1996, Lynn Loftus is informed by the Department of Fisheries and Oceans that the statistical information is available (Exhibit R-64, tabs. 1 & 2). She is also informed that the information will show the purchases made directly from fisherpersons but will not reflect any purchases made from other buyers. Lynn Loftus notes in her diary from that day the following:
"Purchases from other buyers is considered a secondary purchase and would not be shown on any purchase material for DFO as they only want to know what is fished, not how many times it is passed from buyer to buyer. The sales records will show amounts in pounds sold as reported by the buyer. For example, she has record of 35,000 pounds of shell clams sold. If the buyer (Sharbell) purchased from another buyer to fill an order, the purchase would not be reflected, but the sale would be. She didn't know if Sharbells were in the habit of doing this as they are not one of the larger dealers. She just wanted to alert us to the practise in case the buyer was doing this. Information will be mailed to my attention today."
[79] On May 6, 1996, Lynn Loftus prepares her analysis of the statistical information by species for the 1992 and 1993 years. She states in her diary (Exhibit R-64, tab. 12, p. 8):
"May 6/96: Received computer information from DFO. Prepared analysis of information by species for 1992 and for 1993. This information should be an accurate reporting of what Sharbells purchased from fishers (does not include from other buyers). This information should accurately reflect and agree with the amounts the workers sold and will show whether or not the scribblers are accurate, or if, in fact, they are export amounts only."
[80] On May 7, 1996, Lynn Loftus is conducting the volume analysis and she concludes that nothing agrees with anything. The excerpt from her diary states:
"May 7/96: Still working on the volume analysis. So far, nothing agrees with anything. The annual sales report (in pounds) does not agree with the purchases, and if fact, frequently exceeds the purchases. Will have to contact Dale to see if he was buying from other plants or what information he used to prepare the annual report. Called Bernard McCabe to see if he would contact Dale and tell him we require further information. Bernard set up appointment for me to come to his office and he would ensure Dale was there. Appt. set for May 21/96 at 9 a.m. In the meantime will continue with volume analysis and will select one species as a sample."
[81] On May 21, 1996, Lynn Loftus conducts an interview with Dale Sharbell at the office of Bernard McCabe. She noted in her diary (Exhibit R-64, tab. 12, p. 8) the following, as result of the meeting:
"QUESTIONS AND ANSWERS FROM INTERVIEW WITH DALE SHARBELL AT BERNARD MCCABE'S OFFICE MAY 21/96
l. DO YOU HAVE RECORDS OF LOCAL SALES AND IF SO ARE THEY BROKEN DOWN INTO SPECIES; MONTH, YEAR, ETC. AND IN POUNDS?
A: The accountant should have all that. The sale were recorded all week and on Saturday night, the tape from the calculator and the expenses and DFO slips and everything were put in an envelope and sent to the accountants.
2. WHAT IS THE NORMAL SPOILAGE/DAMAGE RATE PER POUND FOR EACH OF THE FOLLOWING SPECIES...
soft shell clam? roughly 10%
bar clams? depends on how fast they move--about 5% (+/-)
quahaugs? very small--don't lose their juice, have a hard shell
eels? netted--2% Speared--5% (dirtier)
oysters? not sure--live a long time and don't damage easily
smelts? loss of 30% on dressed eels.
3. IF THIS LOSS RECORDED ANYWHERE?
A: Not really recorded. It is just expected as normal loss of product when you are dealing in fresh.
4. THE ANNUAL REPORT OF SALES OF SPECIFIED PRODUCT PROCESSORS, PACKERS, HANDLERS,---DFO 1993 RAISES QUESTIONS-- WHAT DOCUMENTS WERE USED TO CREATE THIS REPORT?
A: Sales records. It is for export sales too.
WHY WAS THE REPORT PREPARED IN 1995 FOR 1993?
A: I must have forgotten to do it.
MOST OF THE FIGURES END IN OO. WAS THIS A ROUNDED OFF FIGURE AND HOW DID YOU CALCULATE IT?
A: It's kind of like an estimate. It is to the nearest 100 or 1000.
5A. QUAHAUGS WERE PURCHASED BY THE POUND. RECORDS INDICATE THEY WERE SOLD BY NUMBER. WHY WAS THIS DONE AND HOW IS IT DONE?
A: When they're sold, they are done up in bushel bags. There are 400 small in a bag; 225 medium in a bag; and around 100 large in a bag. A bushel is roughly 60 pounds. It is done this way as it is standard practice now that every one has the machine that grades and counts.
5b. CLAMS WERE EXPORTED AND ALSO SOLD .LOCALLY. RECORDS INDICATE SALES OF $4875 TO FRENCH RIVER CANNERY, FOR EXAMPLE. WOULD THE PURCHASE FOR SALE OF THESE CLAMS BE SHOWN IN THE QMP SCRIBBLERS?
A: Shouldn't be. Some bar clams didn't go through if they were sold locally.
5c. ARE SALES TO COCAGNE AND SUMNER INCLUDED IN PURCHASES IN QMP SCRIBBLERS?
A: If they went off the Island they were, but if not, then they weren't.
6. BAR CLAM PURCHASES FOR PRODUCT FISHED OUT OF PROVINCE:--ARE THESE PRODUCTS RECORDED IN THE QMP SCRIBBLERS, WERE THOSE PRODUCTS SOLD OFF ISLAND?
A: I don't think anything was bought off-Island.
7. DID YOU PURCHASE PRODUCT FOR OTHER BUYERS OR PLANTS? IF SO, WHAT SPECIES AND VOLUMES? WHAT WAS DONE WITH THESE PRODUCTS?
A: It happened when we were short. I bought some from Gary Wilson. If I needed extra to fill an order, I could get it from another buyer. I wouldn't be able to say how much now, but that is why I'd do it.
8. EXPLAIN THE DISCREPANCY BETWEEN QMP SCRIBBLERS AND THE ANNUAL REPORT OF CLAMS. THERE IS A DIFFERENCE OF OVER 20,000 POUNDS (10 TONS).
A: Invoices from South Shore Trading were used to prepare annual report on eels, for example, because they bought about 98% of the eels.
Sold a lot of clams locally. If people knew the tides were good, they would come get fresh clams and I sold to Jollimore at L & C Fishery and some others. I would say the DFO slips and the annual report should be pretty close if everything was on it for export and the other. The annual report showed only EXPORTS for the clams. Local sold not recorded on the annual sales report, nor in the QMP scribblers.
OTHER INFORMATION PROVIDED AT INTERVIEW:--
Bernard McCabe and Dale Sharbell both addressed the fact that the accountant, Byron Murray, and Nancy Small were very upset with HRDC when the records for the payor were returned as the tapes which showed the actual sales in each week/month were missing when the records when returned. The DFO slips and tapes were placed in an envelope each weekend and sent to the accountant's office. The totals were verified by Nancy Small and this was the basis of the payor's annual financial statement of income. They have not been provided with an explanation to date on the whereabouts of the tapes.
Bernard McCabe prepared a short analysis of a small sampling of names listed in the QMP scribblers. In this sampling (oysters) it was revealed that the QMP did not., in fact, present a true picture of who would be considered to be insurable. The first example was JIM GETSON. Mr. Getson is a dealer. He purchased oysters from fishermen at the shore. He sold the oysters to Dale Sharbell. When Dale Sharbell received oysters from Mr. Getson, it was recorded as fish purchased from Mr. Getson from a specific area. However, Mr. Getson did not receive a DFO slip as he had not fish the product himself. Mr. Getson would have issued a DFO slip to the people he purchased the oysters from. The reason Mr. Getson was not involved in the QMP was that he did not have an export license and was not required to participate. Mr. McCabe produced a copy of the QMP page from the records showing Mr. Getson making eight deliveries. His point was that the scribblers would not necessarily agree with the DFO records as there are exceptional circumstances. Mr. Getson should not have had a "stamp" for those eight deliveries as he is not a fisherman. He would be responsible, however, in the event of contamination for the delivery as he was the one who brought the product to the payor. The other effect of this is that all of a sudden Mr. Getson now has been given insurable weeks by RCT rulings based on the QMP and he is not eligible for it.
Mr. McCabe stated that a lot of the DFO slips they looked at did not identify species. He asked how those records were matched to QMP. I did not have this information. Mr. McCabe telephoned Byron Murray at Doane Raymond to request that any additional information regarding weekly sales from Sharbells be provided to me. If there are any additional records showing what the fish plant sold locally and these figures combined with the export figures total the purchases Sharbells reported on DFO slips, then the QMP would be shown as incorrect. Mr. Murray was with a client and Mr. McCabe left a message for him to call. Mr. McCabe indicated he would have Mr. Murray forward any additional information to me." (underlining by the undersigned)
[82] On May 30, 1996, since no additional information as to the weekly sales or local sales was forwarded to Lynn Loftus by the Payor, counsel for the Payor or the Payor's accountant, she assumed that there was nothing further. She then called Lew Stevenson of HRDC. Her diary (Exhibit R-64, tab. 12, p. 10) describes the gist of the conversation:
"May 30/96: No additional information received, therefore, to assume there is nothing further. I have not heard from Mr. Sharbell; Mr. McCabe; or Mr. Murray.
Called Lew Stevenson of HRDC. He is a major fraud investigator and handled this case. I asked Mr. Stevenson what prompted the investigation and how it was handled by them. I also asked if there were reasons why he felt the investigation was conducted on all fishers selling to Sharbells. Mr. Stevenson indicated he had done a sampling of several fish plants to see if the DFO slips and sales of product matched as suspicion had been raised after some fishers had indicated the DFO slips were inflated by some buyers. The result is an on-going investigation into all shellfish buyers on PEI. Mr. Stevenson advised me of the basic history of the investigation. When asked if he had reason to believe the DFO slips were falsified in the fist place, he responded that some of the fishers he interviewed told him that the DFO slips and ROEs were false. He further stated one lady-fisher told him that she needed two more weeks to qualify for benefits and, although Dale Sharbell "grumbled" and "was cranky", he accommodated her. I asked what benefit it was to the client to tell him this. He stated she was at a disadvantage to tell him the truth, but felt she had to. The disadvantage to her and to others in her situation was that they may have to repay benefits and then may have to have 20 weeks in a year to re-qualify for benefits as opposed to 10 or 12." (underlining by the undersigned)
[83] On the same day, May 30, 1996, Lynn Loftus prepared a 6-page report to the Head Office (Exhibit R-64, tab. 13) for direction. The last paragraphs reads as follows:
"The above are just a sampling of the files. There are no two alike, although there is common information in each of the files.
Through discussion with the Chief of Appeals, Walter MacDonald, and review of the material at hand, it looks like there is nothing additional to refute the rulings officer's decision. As it stands, we will be using the available information to review each case for any variations based on additional information should any of the Appellants have proof the ruling was incorrect. This may result in small variations in weeks-ending or amounts. However, the common information indicates the QMP scribbler information on purchases by the buyer is closest to the figures for sales of product by the buyer. The figures found on the DFO slips are so far out of line with purchases and sales, that they are not reliable. There has been no information regarding unreported sales provided by the buyer or his accountant, although ample time has been allowed, so the purchases have been accepted as shown on the QMP records. The Department of Justice have expressed an opinion that with proper handling of the case the QMP records could be introduced and used in court.
Before any recommendations are made and determinations issued, we are requesting that you review our progress to date. I have enclosed a copy of what we call The Master File; the body of the CPT 110 and the diary of events, I have also included the four files mentioned above. I believe they should be relatively clear, but then I've become so familiar with the files that I may be "missing the forest for the trees". If you should need clarification on anything, or if you wish to discuss the files, please call me at (902) 628-4231. We will continue to do interviews on the remaining files but will hold any determination letters until we hear from you." (underlining by the undersigned)
[84] On June 3, 1996, Lynn Loftus forwards her report (Exhibit R-64, tab. 13), her diary (Exhibit R-64, tab. 12), a generic CPT 110 (Exhibit R-64, tab. 11) and the files of four fisherpersons (Kerry Arsenault, Brenton Boylan, Eliza Clements and Claudette Gallant) to the Head Office.
[85] On June 7, 1996, Patricia Griffin begins her duties in the appeals process and is assigned files.
[86] On June 17, 1996, in reviewing a file it was discovered that a formula was used by the Rulings Officer to determine insurable weeks and earnings. A copy of the formula was given to Lynn Loftus. Her diary describes the following:
"Apparently, in weeks where the QMP scribbler records could be reasonably balanced with the sales invoices of the payor, then the QMP records were accepted as being an accurate record of purchases. In cases where the QMP scribbler records did not match the sales invoices, the QMP records were not considered to be an accurate record. In the situation where QMP and Sales invoices matched, the rulings officers calculated the insurable weeks-ending and insurable earnings based on the QMP records. In situations where the QMP and the Sales Invoices did not match, the workers were given the benefit of doubt and the DFO slips were accepted, as there was nothing to disprove their accuracy for those periods."
[87] As a result of this discovery a flow chart, formula chart and a memo were prepared for the Head Office.
[88] On June 18, 1996, the Director of CPP/UI Appeals Division sends his comments and recommendations (Exhibit R-68) to the Chief of Appeals in Charlottetown. Two of his comments read as follows:
« • As mentioned in the Digest of the Case Law, the Fishermen's Regulations extend the protection of unemployment insurance to a class of self-employed persons who would normally not participate in the plan. Therefore, they must be interpreted narrowly. We are in agreement with the process used in your investigation. We believe that there is sufficient information in the file to demonstrate to a TCC Judge that the records presented by the employer were inadequate. The CPT-110 Summary should indicate that the Department was fully justified in making estimations and had acted in accordance with section 80 of the Fishing Reg.
• The decision made in each case is highly related to the credibility of the situation alleged by the affected parties. The Appeals Officer who had worked on the file is normally the best person for judging the credibility of a particular case. Therefore, we are of the opinion that a reference to a jurisprudence is not necessary and that HQ does not have to comment on the issue of each case separately as each one is judgement called."
[89] On June 19, 1996, the Appeals Division prepared a formula for calculating insurable weeks (Exhibit R-64, tab. 14).
[90] On June 20, 1996, Lynn Loftus indicates in her diary what she understood of the comments made in the report from the Head Office (Exhibit R-68), as follows:
June 20/96: Received the file back from HO. Copy of letter and recommendation in file.
Basically, the HO opinion was that there is sufficient information in the file to accept the QMP scribblers where there is evidence they are in agreement with the sales and to proceed with files. Also stated that credibility is a judgement question that must be addressed in each case, etc. No jurisprudence offered.
[91] On June 21, 1996, the Principal Appeals Officer, Lynn Loftus, meets with Gary Robbins, the Rulings Officer, to discuss how his calculations were done for species of fish listed in the Payor's QMP scribblers (Exhibits R-1 and R-2). Her diary (Exhibit R-64, pp. 11 & 12) summarizes the discussion as follows:
June 21/96: Discussion with Gary Robbins re: how calculation was done for species listed in pounds only in scribblers. Gary stated that they took the amounts shown as the price per pound in the same week on DFO slips and used that as the price paid. When I asked if this didn't contradict the lack of credibility of the DFO slips, the rulings officer stated it was not too likely that the price was inflated as it was that the number of pounds on the DFO slips was inflated. The prices paid to different fishers varied in the same weeks with the same species. Some fishers were paid more than others on a regular basis. Therefore, the only formula they could use in rulings to determine the earnings according to the QMP scribblers was to use the price per pound shown of the DFO slips for the fisher around the same time period.
[92] On June 24, 1996, the CPT 110 report, which deals with the common information as to the appeals related to the Sharbell Fish Mart inquiry, is terminated (Exhibit R-64, tab. 11).
[93] On July 5, 1996, Justina Doucette, a Primary Product Inspector with the Department of Fisheries and Oceans is interviewed by Lew Stevenson of HRDC (Exhibit A-1, tab. 36). She was asked and answered four questions which read as follows:
Question # 1: Mrs. Doucette, in 1993, what was your position with the Dept. of Fisheries and Oceans?
Answer: I was a primary product inspector.
Question # 2: Mrs. Doucette, during 1993, did you carry out Quality Monitoring Inspection of Sharbell's Fish Mart in Portage, Prince Edward Island?
Answer: Yes.
Question # 3: Mrs. Doucette, did Sharbells' Fish Mart keep track of individual deliveries made by fisherpersons?
Answer: Yes.
Question # 4: Mrs. Doucette, were the exercise books I now show you used by Sharbell's Fish Mart to record daily deliveries from individual fisherpersons in 1993? If not, what did the company use to maintain the required delivery records?
Answer: I know Sharbell Fish Mart kept all the required records because I don't remember having any problems and I must have checked these records but I just don't remember what records I checked and if it was this (...) exercise books I reviewed.
[94] On July 8, 1996, Gary Robbins, the Rulings Officer prepares a summary of his reasons for HRDC. It reads as follows:
SHARBELL RULINGS PROJECT
SUMMARY FOR HRD
As part of their agreement with Dept. of Fisheries & Oceans the employer maintained several sets of Quality Management Program (QMP) records regarding product purchased from fishermen. These records included the Daily Delivery Records (scribblers), Raw Product Inspection Reports, and Shipment Record Reports. The employer was required to maintain these records starting in the spring of 1992. The above-noted records were obtained from the employer covering 1992 and 1993 for the following species; soft shell clams, bar clams, quahaugs (1993 only), oysters and eels. The employer also dealt in several other species, such as flounder, gaspereaux, mackerel, scallops, and lobster. These species however were not subject to QMP record keeping requirements.
A review of the QMP records that were obtained from the employer indicated that they matched, for the most part, with the information in the sales records that were obtained from the employer. There were several periods however where the information showed sales in excess of purchases. For these periods it is clear that the QMP scribbler records are not a complete record of purchases from fishermen. These incomplete periods are mainly in 1992 which is when the employer first started the QMP record keeping process.
The approach taken with the Rulings is to the give the fisherman insurable earnings for the amounts and dates indicated in the QMP scribblers. The exception is for when a fisherman has sales in his name in the scribbler during one of the above-mentioned incomplete periods. In those cases, since the scribbler for that period cannot be shown to be complete; the benefit of the doubt is given to the fisherman and no change is made to the ROE. This approach allows us to use the QMP records as the basis for making rulings only for those periods where the records can be shown to be accurate.
Another issue dealt with was the approach taken in situations where a fisherman is listed in the QMP scribblers as having made sales but for amounts that were below the minimum insurable amounts for that particular year. In these cases the fisherman would be given the minimum amount if the information indicated that he was the owner or leasee of the boat used in making the catch or if there was any specialized gear used. If there was record that the fisherman had refused the delivery as insurable earnings then that would be accepted and none would be given.
Rulings Officer: Gary Robbins
Date: July 8, 1996 (underlining by the undersigned).
[95] On or about one week prior to July 19, 1996, Lynn Loftus sends by fax to the Department of Justice "the basic Head Office report" (Exhibit R-64, tab. 13).
[96] On July 19, 1996, letter sent to Senior Counsel Justice.
[97] On July 25 and July 26, 1996, determination prepared by Lynn Loftus in the case of Janet W. Arsenault (Exhibits R-3-1 and R-3-2).
[98] On July 26, 1996, final discussion with the Department of Justice. The Respondent begins to issue letters to the Appellants and notifications of determinations made by the Respondent are being sent to Appellants.
[99] On August 19, 1996, one of the Appellants, Donna Lewis, voices her concern to the Principal Appeals Officer, Lynn Loftus. The diary (Exhibit R-64, tab. 12, pp.12 & 13) indicates the following:
August 19, 1996: Received a telephone call from Donna Lewis (an Appellant). She was concerned that her file did not contain a copy of the interview with Martin Smith (who worked for Sharbell) as she felt it formed a significant part of the investigation. I advised her I had not interviewed Mr. Smith as he had only been a worker in the plant and that ultimately Dale Sharbell was the payor and was the person responsible for issuing DFOs; ROEs and the QMP records. She stated there was an interview with Lew Stevenson and Smith and others and that the interview revealed important information. Donna Lewis' file has been completed and the notification was issued. I advised her to check with Lew Stevenson regarding the interview because it did not form a part of our file.
[100] On August 27, 1996, the Appellant Donna Lewis, calls for the second time. Lynn Loftus is advised by Lew Stevenson of HRDC that he is in possession of his report on the investigation and would fax it to the offices of the Respondent with a copy of the history of attempts at interviews with Dale Sharbell and a copy of the interview with Martin Smith. Lynn Loftus summarizes the report of Lew Stevenson in her diary (Exhibit R-64, tab. 12, p. 13) as follows:
August 27/96: Donna Lewis called. She was talking with Lew Stevenson who advised her that the report on the interview with Martin Smith was copied and sent with the files to RCT and that we would have copies in our records. I checked the Master File and then with Rulings Officer, Gary Robbins. Rulings do not have a copy of the Martin Smith interview. Called Lew Stevenson and advised him we had never received a copy of the Martin Smith interview report. He appeared to find it hard to believe we would not have it. Asked him to FAX a copy of it to me. Mr. Stevenson also stated he had his report of the investigation and would FAX it as well along with a copy of the history of attempts at interviews with Dale Sharbell.
Received copies; reviewed; copied for the Appeals Officers and the Master File. Interview with Martin Smith does not add any new information, but shows that Mr. Smith was directed by Dale Sharbell on when and how to complete his duties. The report indicates that the QMP records were completed in a hap hazard manner. The report on the investigation from Lew Stevenson and Joe Pierce explains how they arrived at a decision on the QMP records being accurate as many people indicated DFO/ROEs were falsified and the DFO amounts exceeded the sale of product much of the time.
[101] In October of 1996, the diary of Lynn Loftus indicates that she received a response from Headquarters regarding insurable weeks etc...
[102] On October 3, 1996, HRDC represented by the Regional Investigation and Control Officer forwards to the Payor an Employee penalty letter under subsection 33(2) of the Act (Exhibit R-19). This letter states in the first paragraph in particular following:
As a result of our investigation, it is our opinion that you have knowingly made false or misleading statements by completing the following list of Records of Employment showing earnings and or insured weeks which did not represent a true and accurate account of the employees work and/or earnings. (underlining by undersigned)
[103] This letter lists 98 names of individuals, including some Appellants, their social insurance numbers, the serial number of the records of employment and the dates of the signing of the records of employment. All the dates on the records of employment are for 1993 except one which is for 1994.
[104] On October 10, 1996, HRDC, through its insurance agents send out to Appellants Donna Lewis, Janet W. Arsenault and Lloyd Lewis in particular, penalty letters (Exhibit R-3-7) based on section 33 of the Act. The first paragraph of these three letters are worded in an identical form as follows:
We have reviewed your unemployment Insurance claim dated October 31, 1993 and have determined that you gave 16 false or misleading statement(s). Contrary to what you told us, we have learned that you submitted a Record of Employment from Sharbell's Fish Mart that you knew to be falsified. In conjunction with this false Record of Employment, we consider each reporting card that you submitted to be a false statement as well. (underlining by undersigned)
Other Appellants received similar notices and these will be referred to later in the analysis of the evidence for individual Appellants (if necessary). In these letters they are told that if they are not satisfied with the decision they may appeal to the Board of Referees within 30 days of the receipt of the letter.
[105] On June 9, 10 and 11, 1997, the lawyers for the Department of Justice meet with the officers who worked on the files of the Appellants.
[106] The final determinations were sent out by the Respondent through the Office of the Chief of Appeals in Charlottetown in the latter part of 1996 and early 1997. The last determination in these appeals was sent out on September 2, 1997 in the case of Judy Walfield (Exhibit R-56, p. 6).
B- The witnesses of the Department of Fisheries and Oceans (DFO)
1. Eric Joseph Bernard
[107] Mr. Eric Joseph Bernard, a Fishery Officer, gave to the Court very helpful and general information as to the fishing industry in Prince Edward Island. He spoke of the different species of fish, how, when and where they are captured; the licence required if necessary, how the fish are conserved and the type of equipment or gear required to fish. The Court thanks him.
2. Adrian Bernard Doucette
[108] This witness was heard on January 19, 1999.
[109] In 1992 and 1993, he worked as a fisheries inspection's Officer with the Department of Fisheries and Oceans. He was responsible for inspections at the Payor's fish mart in 1992 and 1993. He did the inspection on fresh smelts but not on molluscs. He did not have much to do with the shellfish industry.
[110] He stated that he was familiar with the quality management program (QMP) at the Payor's fish mart. It was part of his job description. He described the QMP as a plan that the processors have in place in the plants to ensure that fish and fish products are processed in a safe manner for health purposes. During his inspections he dealt with Dale Sharbell of the Payor. He also dealt with Martin Smith.
[111] When asked whether he was responsible for ensuring that the QMP scribbler was done properly and whether it was a proper record he said: "It was a new plan, in a voluntary stage in 1991, and in 1992 and 1993, they were just barely getting off the block. We were trying to get them into the system and if there were discrepancies and there was quite a deal of discrepancies in any plant, not only the plant we are speaking about. We would deal with that as a deficiency and work with them to make sure that they did what they were supposed to do on their records. So it wasn't unusual to find discrepancies in the records in those days". In 1993, the plants were a bit more experienced and DFO was having less problems getting this program off the ground.
[112] He explained that there were two records of incoming fish. He presumed the Payor was using DFO slips and the scribblers which he saw at the Payor's plant. He stated that "the name of the harvester was required to be marked in the QMP scribblers", also, they should contain the fisherman's name, the date, the year, the species, the quantity and the harvesting area.
[113] It is the fish plants' responsibility to know the Rules and Regulations of the Fish Inspection Act. If the inspector finds a problem the plant must be informed and must rectify it. The quality control is the responsibility of the fish plant. The inspections were random and the Payor would not be advised in advance of the date or time of inspection.
[114] He also said that over the counter sales were required to be recorded in QMP records, so that everything sold or shipped from the Payor's premises could be accounted for.
[115] He was not aware if the QMP program listed over the counter sales. He said that the Payor kept accurate records for all shellfish purchases each day from each fisher in 1992 and 1993. He also said that if the Payor did not record fish sold over the counter, his records would not be accurate.
[116] He remembers that the Payor was issued a warning to keep proper QMP records but could not remember the details. This witness had nothing to do with DFO sales slips and was more involved in the winter operations of the Payor's plant than the summer and fall operation.
[117] He stated that the program is checked when an inspection is carried out. In the case of this Payor a QMP inspection was carried out once in 1992 and 1993, and there was nothing wrong with the records. However, this inspection was for a single 24-hour period. There was no reason to monitor items going in or going out of the Payor's plant quality control records.
[118] He also said that the Payor is responsible for the product that came into the plant. If the product is shipped, the name and address of the shipper and other information must be on the box. If the product is sold to another buyer within the province there would be no shipping record on them. There would be no shipping record on over the counter sales, although he did say that the Payor had to be accountable for all incoming and outgoing shellfish. This stipulation is in the contract that is signed between the fish plant and the Department of Fisheries and Oceans.
[119] In re-examination he said that the warnings that might have been given to the Payor were not with regards to records that had been kept regarding shellfish.
[120] The type of records identified as QMP scribblers were not maintained at his office. He was not responsible for carrying out an audit. He also said that the fish plants had to keep records of where the product was coming from. The type of records to maintain was left up to fish plants as long as the information was acceptable to the Department of Fisheries and Oceans. In this case the Payor used "scribblers". Photocopies of the Payor's scribblers for the years 1992 and 1993 were filed and may be found in Exhibits R-1 and R-2.
3. Justina Doucette
[121] This witness was heard on January 19, 1999.
[122] This witness was a fishery products inspector. Her supervisor was Don Love. She was responsible for inspections of the QMP scribblers at the Payor's establishment in 1992 and 1993.
[123] She dealt with Martin Smith and Dale Sharbell of the Payor. She inspected the scribblers. They contained information as to incoming fish, the date it was fished, the amount that came in, the harvest area and the name of the fisherperson.
[124] When a QMP inspection took place, she would check the Payor's QMP records. She had to be able to have the harvester's name. The inspection was at random, she did not check all the records. There were also other different records that were verified such as sanitation, final product, shipping and raw inspection reports.
[125] The Payor passed the QMP reporting requirement for 1992, 1993 and the rating was satisfactory. There was never a total reconciliation of the Payor's records.
[126] It would be possible for products to enter the plant, to be sold over the counter without being entered in the QMP scribblers.
[127] It would also be possible for products to enter the plant and be sent out to other buyers.
[128] It would not be possible for the Payor to ship products out of the province or out of the country without being recorded. She carried out a few inspections in 1992 and 1993.
[129] In cross-examination, this witness admitted that her inspections were not to determine whether the numbers added up properly.
[130] She was not there to determine how much fish was brought in.
[131] Her duties were not to conduct an actual audit of the books.
[132] Her main duty was to see that the Payor was maintaining records which could allow, in case of contamination, to get back to the source of contamination. She could not remember checking a record of over the counter sales.
[133] She was not there to do an audit or check on accounting procedures or bookkeeping practices. She also said that DFO slips were used for statistic purposes.
4. DFO admission
[134] It was admitted that if a representative from DFO was heard as a witness, this person would say what is outlined in Exhibit R-70 as follows:
Department of Fisheries & Oceans (DFO)
Admitted Facts
- DFO Slip Books are numbered sequentially and contain 4 copies of each slip
- one for the fisherperson
- one for the buyer
- 2 to be sent to DFO
- Completed DFO slips are received and/or picked up by DFO on a sporadic basis
- DFO does not track DFO Slip Books
- no record is maintained of the specific books given to a particular buyer
- Purpose of the DFO Slips is to gather statistics
- specifically: statistics on the amount of fish (of a given species) fished in a given area during a period of time
- It is the responsibility of the Buyer to accurately report, on the DFO Slips, what they are purchasing from fisherpersons
- DFO does not audit nor verify the information contained in a DFO slip
C- The witnesses of the Payor
1. Martin Smith
[135] This witness was heard on January 19, 1999.
[136] This witness worked for the Payor in 1992 and 1993. He was responsible for the QMP for the Payor in 1993. He said that the Payor maintained and was required to keep proper QMP records. He identified the QMP scribblers (Exhibits R-1 and R-2).
[137] He was required to enter the date, the quantity fished, the name of the product, the day it was fished and the area the product came from by lot number. He was required at a later date to enter the fishermen's names. The lot numbers were determined mostly in a 24-hour period.
[138] The information he wrote in the QMP scribblers was received from Dale Sharbell. He explained that Dale Sharbell had a notebook in which he noted all the deliveries of fish to the Payor's plant. From this notebook he was given the days of fishing, the quantity fished and the area number where the product was fished.
[139] He stated that these recordings were not made at the time of delivery but were made whenever they had time to sit down and do it. This information was not verified with the DFO slips either. He also said that the names on the pages in the scribblers did not correspond to the fish deliveries
[140] When a fisherman came in to deliver his fish, he was given a slip of paper of any kind with the quantity and the product written on it. From there the fisherman would go to the store to get paid.
[141] No record was kept of sales which were made over the counter.
[142] DFO inspectors were not strict in the inspection of the QMP records.
[143] He also stated that he prepared DFO slips. He said that they were accurate.
[144] He could not however explain why no entries were made in the scribblers for Donna Lewis. He had no explanation for there being more entries in the scribblers for Lloyd Lewis than what he claimed to have fished in 1993.
[145] He said that it was possible that entries in the QMP scribblers for people with the same family name could have been entered under one name. He said that he never entered one spouse's deliveries under the other spouse's name.
[146] He also said that entries for deliveries were put under the names of people or fishermen that did not deliver fish.
[147] The witness in explaining page 4 of Exhibit A-1, tab. 34, stated that these entries were not delivered by the person whose name is at the top of the page.
[148] Being examined by the Court, the witness said that the Court cannot rely on the scribblers but on the DFO slips that were given to the fishermen. However, the witness also said that DFO slips were not issued at each delivery but either when requested or at the end of the week. He also said that on a regular basis fishermen could deliver fish to the Payor's plant, receive a slip of paper, get paid and receive no DFO slip for the delivery. All fishermen did not request DFO slips at every sale. He could not remember the name of any fisherman, who was present at this hearing in January of 1999, whom requested a DFO slip for every sale.
[149] In cross-examination, the witness said that it was in 1992 that the QMP program started. The records in the scribblers were not done on a daily basis, a couple of weeks could pass before they were recorded. He stated that there were names in the scribblers and quantities assigned to them that should not be there. He also said that there were names that should have been recorded and quantities assigned to them that are not in the scribblers. The purpose of the scribblers was to satisfy the Department of Fisheries and Oceans.
[150] The DFO slips, contained in books, were the most important item in the Payor's plant (Exhibit R-13). There could be as many as one-half dozen books on the go or in use in the fish building and in the store.
[151] He was questioned in relation to fishermen's declarations. He said that Stan McCallum from Revenue Canada attended the Payor's premises every spring. The Payor was told that it would be preferable to have written declarations from fishermen. In 1992, they gave verbal declarations and in 1993 they began using written ones. These declarations were not filled out every time a fisherman came to the Payor to sell his fish. These declarations were filled out at the same time or prior to the DFO slips being filled out. He was not sure.
[152] The DFO slips were made up when the fisherperson requested them and they were mostly made out in their presence. These slips were made out at the end of the week for the fish delivered during the week. The fisherman would bring in his slips of paper to be totalled up or it was made up at the time of delivery if they made only one delivery during that week. Martin Smith stated that the DFO slips were made up by himself from delivery information he was aware of. He also made up DFO slips from information that was passed on to him from Dale Sharbell and DFO slips were also made up by Dale Sharbell personally.
[153] He remembered Eliza Clements who delivered clams. He did not remember Allan McInnis selling anything to him in 1993.
[154] He did not fill out DFO slips for Keith Lewis (Exhibit B-4, tab. 3).
[155] He also stated that the word "stamp" on the DFO slip meant that the fisherman paid his unemployment insurance premiums and wanted a stamp. He is the brother of Myles Smith.
[156] He was not able to explain why Dale Rafferty's name was in the scribblers and why no DFO slip or record of employment were made out for this person in 1992.
[157] He did not fill out any of the declarations or DFO slips in the case of Wayne Milligan (Exhibit B-9, tab. 3).
[158] In the case of Maureen Costain (Exhibit B-10, tab. 5), he filled out two declarations on July 21 and 31, 1993 and one DFO slip dated July 31, 1993.
[159] In the case of Sandra Rafferty (Exhibit B-11, tab. 3), he identified certain DFO slips that he filled out. The declaration of the fisherman was signed by Dale Rafferty although the DFO slips were made out to Sandra Rafferty. The explanation provided was that Dale Rafferty might have dropped off the product. Martin Smith added that Stan McCallum of Revenue Canada had "told us that it is possible for people to sign their declarations for them". He stated he did not make out the DFO slips in the name of Sandra Rafferty in 1992.
[160] In the case of Pius Bulger (Exhibit R-4, tab. 3) the witness was asked if there was an obligation on Mr. Bulger in 1993, according to the instructions received from Revenue Canada, for him to take a stamp. He said that there was a time when "you had a choice whether you wanted to pay your UI onto it or take a stamp or not take a stamp". The indication "stamp" on the bottom of the DFO slip would indicate that the DFO slip would be considered for a stamp or insurable earnings. The DFO slips in the name of Pius Bulger have no indication of a "stamp" on them.
[161] In the case of Betty Lewis (Exhibit B-13, tab. 3), he said that the DFO slip dated July 16, 1993 appeared familiar to him and that he did not sign any DFO slips for this person in 1992. He remembers Betty Lewis selling there.
[162] In the case of Paul Sharpe (Exhibit B-14, tab. 3), the witness explained that the written declaration was signed on May 25, 1993 it being when they started to require written declarations before the document was sent to be printed.
[163] In the case of Carl Lewis (Exhibit B-15, tab. 7), he did not fill out the DFO slips for the year 1993.
[164] In the case of Elmer Lewis (Exhibit B-16, tab. 4), he did not fill out any of the DFO slips for this person although he does remember him selling products to the Payor.
[165] The product that came right off the scales and was sold either at the store or out of the fish mart itself did not appear in the scribblers. He also said that some of the product was moved out to other buyers in 1992 and 1993 and there were no records in the scribblers.
[166] In cross-examination by Mr. Prevost, counsel for the Respondent, the witness stated that he worked for the Payor in 1992 and 1993. In 1992 "he fished also on the side to fill my stamp". He also sold his fish to the Payor. He did not think that his deliveries were entered into the scribblers.
[167] He was shown Exhibit R-1, tab. 3, page. 28: this page of the scribblers is under his name. The only writing that was not his was that entered for May 21, 1992. He could not remember whether the other dates on the page corresponded to the dates he had fished. He stated that the dates were not accurate ones. He also admitted that the amounts of fish he wrote in were correct. The reason for doing this was that he was told by Adrian Doucette that it was of no importance because it was only for QMP records.
[168] He was then directed to an entry made by himself on May 16 (Exhibit R-1, tab. 3, p. 48), recording the delivery of 70 pounds of eels caught at Mill River. Although his name appears on the page in the scribblers he said that he did not deliver fish to the Payor on that day. He did not know who delivered the fish. Then when asked how he knew the fish came from Mill River, he replied that he would have to take the fisherman's word for it. He was then asked how he could know the fisherman's name if he was making the entry under his own name. To this, he replied that Dale Sharbell would instruct him to do so, knowing that it was not his fishing. Then he was asked "and you just did that because Dale told you to?" He replied "Yes, because we had the understanding that these are not ROE records. They're QMP records".
[169] He then admitted that he was told by Dale Sharbell to do this so that Mr. Sharbell could continue buying fish. He said that the information he wrote in the scribblers was given to him by Dale Sharbell who had it recorded on a pad in his shirt pocket.
[170] He admitted that there was a problem with recording the entries in the QMP records in that fashion. He said that these entries in the Payor's books were not correct to his knowledge.
[171] He admitted that when he made an entry in the scribblers he did not know why it was made. He was asked to explain page 23 in Exhibit R-1, tab. 2. He admitted, he had no idea what the page meant.
[172] He was then directed to Exhibit R-2, tab. 7 at page 105. He admitted that this page was his handwriting but did not know what it represented.
[173] Then his attention was drawn to page 106 in Exhibit R-2, tab. 7. He could not remember why Kevin Penworden and Myles Smith (his brother) were on the same page. He did admit that they sometimes delivered fish at the same time and that it could be the reason their names were on the same page in the scribbler.
[174] Later the attention of the witness was directed to several pages in Exhibit R-2, to which the witness replied that he could not remember or did not know. He was asked how it was that so many details were actually recorded and he replied that the QMP records were not done every day and that "if the entries were records of employment, they would be more accurate but they're not ROE's, they're QMP's".
[175] The witness was then asked that if the QMP's are inaccurate and the DFO's are accurate, why was he not using the information from the DFO's to make the entries in the QMP scribblers. To this he replied he did not know but added that "if the DFO slip was made out at the end of the week and that person made three sales, how would you know which days was his three sales?" After the Court suggested to the witness that he could have written all the dates of delivery on the DFO slips at the end of the week, he did not know why it was not done in that fashion.
[176] He reaffirmed on being questioned by the Court, that he would give out a DFO slip if it was requested, if it was not, none was given. He admitted that deliveries were made by fishermen who never got a DFO because they did not request it "because they didn't have to take a stamp at that time". The only reason the fishermen requested DFO slips was in order to get a stamp for unemployment insurance purposes.
[177] Then he was asked if a fisherman made deliveries earlier in the week, how would he know what was delivered when they request a DFO slip at the end of the week? He replied that Dale Sharbell would have that written on his pad and "there were a lot people that he (Dale Sharbell) trusted with their slips of paper when they got paid and they would bring them in".
[178] He also said that the pads that were used by Dale Sharbell to prepare the DFO's were sometimes the same pads used to make the entries for the QMP scribblers. That Dale Sharbell was the person who gave the authorization to write up the DFO slips.
[179] He was then referred to Exhibit R-6, tab. 22 at page 14. This document was a declaration of Sandra Rafferty, which was signed by Dale Rafferty. In fact, the declaration was signed by Dale Rafferty, but he was not the fisherperson. He replied, that Stan McCallum of Revenue Canada had said that this could be done. He could not recall any other person having his or her fish delivered by someone else. It happened on three occasions for the Rafferty's.
[180] He also admitted that the fishermen's declarations were not always filled out when the fisherman was present and also admitted that the general procedure for making up fishing declarations and DFO slips was to make it when the fisherman was in the plant and could give the information. He did not know whether the prices or the quantity of fish were accurate in the QMP scribblers.
[181] He was then asked what the practice was at the Payor's establishment with regard to unemployment insurance deductions? He said that if a fisherperson was 100% insurable there would be no deductions on the DFO slip and if the fisherperson used a boat or equipment while fishing he would deduct 25% and be 75% insurable.
[182] The DFO slips would show either "no 25% or deduct 25%". If a person came in to the plant and declared that he was using a boat, 25% would be deducted from his insurable earnings.
[183] The Payor would deduct the unemployment insurance premium from the total amounts on the DFO slip at the end of the week. He admitted, however, that none of the DFO slips that he had seen in Court so far would show any deductions of unemployment insurance premiums. He said that this information was kept with the bookkeeper.
[184] He was asked where the unemployment insurance entries or records were being made. He replied that he did not know and he never saw if they were entered in any books. He did not know how records were kept for the deliveries made by fishermen who did not want a DFO slip.
[185] He was asked that if a fisherman brought in 100 pounds of clams and did not request a DFO slip where would it be recorded? He replied that "it would be recorded in the QMP's if it was brought in to the plant".
[186] He also said that if he paid a fisherman and no DFO slip was made up he would advise Dale Sharbell that he bought a certain quantity of fish without recording it but Dale Sharbell would record it.
[187] This witness then explained, when examined by the Court, that he sold fish to the Payor. Whatever fish he sold during a week were his earnings for that week and his unemployment insurance premiums were collected weekly.
[188] The witness also said that in 1992 and 1993, the fishermen did not always get a DFO slip when they delivered fish. They would "get a DFO slip if they asked for it and if they didn't ask for one, they were not given any".
2. Dale Sharbell
[189] This witness was heard on January 20, 21 and 25, 1999.
[190] This witness was a partner in Sharbell's Fish Mart in 1992 and 1993.
[191] He stated there was an agreement between Sharbell's Fish Mart and the Department of Fisheries and Oceans with respect to a quality management program (QMP). The Payor was required to keep accurate records under that agreement.
[192] He said that the QMP figures were accurate for the shipping out of province. The amounts were fairly accurate but the names in the QMP scribblers were not. He said that the amount of fish shipped off the Island was accurate. The names in the scribblers or the quantities of fish per person were not accurate because the scribblers were filled out after the fact. He did not make the entries in the scribblers on a daily basis but weekly or whenever he had time. He made out DFO slips and they were sent to the office. He did not have the DFO slips at his disposal when he made his entries in the scribblers but he kept track of the fish that came in to the plant with notebooks he kept on him. He listed the quantities under the names in the QMP scribblers from his shipping records. He chose at random what name in the scribblers would have a certain quantity of fish under it. He had about 15 scribblers in 1992 and 1993. He had a different scribbler for each type of fish.
[193] He said that at first, he guessed that the names of the fishermen were not supposed to be in the scribblers. In 1992, he made the entries in the scribblers and they were made by Martin Smith in 1993. The information for the 1993 scribblers was given to Martin Smith by himself from the note pads and shipping records. Sometimes he would mark just the amount of fish on a piece of paper and give the paper to Martin Smith and this quantity would be split under different names in the scribblers. The area where the fish came from had to be indicated. He said that when the fish was weighed he made entries in his notebook until he would meet with Martin Smith a day or so later.
[194] He prepared DFO slips when the fish came in or at the end of the week. If he did not prepare a DFO slip when a fisherman delivered fish, he would mark it down in several note pads he had. He noted if it was paid or not and kept track of the deliveries. Sometimes he would give slips of paper to the fishermen to bring back at the end of the day or end of the week. On these slips of paper he would indicate the weight, the amount of fish and the price. At the end of the week, when the fisherperson who mostly always returned, a DFO slip would be prepared. He would have several DFO books on the go at one time.
[195] He never used the information from the DFO slips which were given to the fisherpersons for their fish deliveries, to make or complete the entries in the QMP scribblers (Exhibits R-1 and R-2).
[196] The DFO slips were used to make up the records of employment of the fisherpersons. The DFO slips were sent to his office for that purpose. The witness identified the DFO slips and records of employment of Donna Lewis, Janet W. Arsenault and Lloyd Lewis (Exhibit A-1, tabs.1-3, 5, 7, 16, 20, 25, 26, 28 and 29). He said that the information on these records of employment were accurate as this information came from the DFO slips of the fisherpersons. Some of the records of employment were made up by his sister Marilyn Enman and others were made up at the accounting office of Doane Raymond.
[197] He was shown page 20 of Exhibit A-1, tab. 33, which is also found in Exhibit R-1, tab. 5, p. 83. This page of the QMP scribblers is in the name of Donna Lewis. He was asked to explain why the amounts listed on this page of the QMP scribbler are hundreds of pounds higher than what the Appellant Donna Lewis claimed to have fished as recorded on her DFO slips in 1992? (Exhibit A-1, tab. 3). He said that the entries in the QMP scribblers were put under any name. He said that he had told HRDC that the names in the scribblers were not accurate records. He was asked whether the entries in the QMP scribblers were accurate and he replied that he was not sure and that any amount of product was entered under any name.
[198] He was also shown the QMP scribbler for Janet W. Arsenault (Exhibit A-1, tab. 33, p. 8) also found in Exhibit R-1, tab. 5, p. 71. He was asked in this case why the amounts listed in the scribblers were lower than the amount the Appellant Janet W. Arsenault claimed to have fished according to her DFO slips and her records of employment (Exhibit A-1, tabs. 25 and 28). He replied that he was not sure because any amount of product was put in the scribblers under any names and the QMP books are not accurate.
[199] He was shown the Payor's financial statement for the year ending on February 28, 1993 (Exhibit R-8, tab. 1, p. 30). He said that purchases included all the DFO slips for fish bought from fisherpersons and any other fish bought from other companies. He was also asked whether he always issued a DFO slip for a purchase. His answer was: "mostly always as far as I can remember". He said that over the counter sales were carried out at the delivery building and at the store and that he gave out a DFO slip for deliveries that was used for over the counter sales. He also stated that the over the counter sales were incorporated in the sales at the Payor's fish mart but that some sales went through the store, which was a different part of the Payor's business.
[200] The witness was cross-examined by Mr. Shaw who acted on behalf of several Appellants. He explained that he started working at the family store when he was twelve years of age after completing grade 7.
[201] He began in the fish industry in the early 1980's on a modest scale. In 1988, his business expanded.
[202] He started using DFO slips in 1986. He always paid in cash.
[203] He would meet at the beginning of each fishing season with Stan McCallum of Revenue Canada who would visit in the spring. During these visits, he would be informed by Stan McCallum of any changes that might have been be made for the fishing season.
[204] The witness used the DFO slips as his official receipts. He kept on him a notebook in which he recorded all that came in to his plant. He used this notebook to keep track of his purchases. This notebook would contain all his purchases if a DFO slip was not made out at the time. If a DFO slip was made out at the time of delivery he would not make an entry in this notebook.
[205] The DFO slip was an official receipt for him and the fisherperson. His bookkeeping for purchases was made up of DFO slips and his notebook.
[206] The total purchases would get to his accountant once or twice a week. He would take all the DFO slips, bills and expenses to the accountant and the purchases were then recorded in a journal.
[207] In 1992, if a fisherperson did not have to take a stamp, he would make out a DFO slip and it would be marked "no stamp". He did not take his notebook to the accountant.
[208] He was then referred to the statement he gave to the Respondent on May 13, 1996 (Exhibit B-17, tab. 2), where he advised that the DFO slips were a complete record of his purchases and that the QMP scribblers were inaccurate and incomplete. He said that he did not attempt to lead the Respondent astray and that the QMP scribblers were made up to agree with the inspection slips and the shipping records.
[209] A list of sales for 1993 was recorded and sent to the accountant firm of Doane Raymond. These lists of sales were also sent to HRDC and were not returned to him.
[210] In short he says the QMP records cannot correspond to any record of employment or DFO slip. The QMP records were made up to match the export papers which did not show sales inside the province and which were not reflected in the QMP scribblers.
[211] The witness was then shown exhibits pertaining particularly to the Appellants represented by Mr. Shaw.
[212] For Eliza Clements, he was shown Exhibit B-1, tabs. l and 5. He stated that in this case this Appellant was issued a valid record of employment.
[213] For Allan McInnis (Exhibit B-2), he said that if no record of employment was made out, it was that he did not sell any fish. He stated that this Appellant had probably sold fish to the Payor in previous years. He did not know why this Appellant's name was in the QMP scribblers for 1993.
[214] For Paul Waite, he was shown Exhibits B-3, tabs. 1 and 6, and R-7, tab. 19, p. 16. He remembered Paul Waite. He had no ROE for 1992 but had one for 1993, establishing one week of earnings.
[215] For Keith Lewis, he was shown Exhibit B-4, tabs. 1 to 3. The DFO slips correspond to this Appellant's record of employment.
[216] For Loman MacLean, he was shown Exhibit R-6, tab. 10, p. 22. He said that the DFO in this case was valid.
[217] In the exhibit for John Arsenault, he was shown Exhibits B-6, tabs. 1 and 3 and R-4, tab. 1. He said that the ROE was accurate. He also said that when the word "stamp" is on the DFO, this indicates that the fisherperson paid his unemployment insurance premiums.
[218] For Myles Smith, he was shown Exhibits B-7, tab. 1 and R-7, tab. 17, p. 22. The only week in dispute in this case was October 17, 1992. He identified a DFO slip which he wrote out on October 16, 1992. This DFO slip No. E306372 is in the amount of $960.00. The ROE for this person for the week ending October 17, 1992 is in the amount of $710.00 (Exhibit B-7, tab. 1). He stated that the ROE was correct.
[219] The witness was shown, in the case of Dale Rafferty, Exhibits B-8, tab. 3 and R-6, tab. 13, p. 9. There were no DFO slips made out to this person in 1992.
[220] Exhibit B-9 (also R-6, tab. 12) relating to Wayne Milligan was shown to the witness. He confirmed the record of employment, the fisherperson's deductions and the DFO slip for this person. He explained that the indication "no 25%" on the DFO slip was information for the accountant not to deduct the amount because the fisherperson did not use a boat to make his catch. In the case of a fisherperson who used a boat to make his catch, 25% would be deducted for expenses.
[221] Exhibit B-10, tab. 1 (also R-4, tab. 4) pertaining to Maureen Costain was shown to the witness. He said he was satisfied that the DFO's and the ROE's of this person were correct.
[222] Exhibit B-11, tab. 1 (also R-6, tab. 14) pertaining to Sandra Rafferty was shown to the witness. He confirmed the ROE's and DFO's were correct. In 1993, on three occasions the fisherpersons declarations were signed by Dale Rafferty, the Appellant's husband. The witness said that the was "pretty sure" that Stan McCallum would have told him "that if a husband came in with oysters he could sign it for his wife". He said that the DFO slips were accurate for 1992.
[223] Exhibit B-12, tab. 9, p. 2 pertaining to Pius Bulger was shown to the witness. This exhibit shows $462.50 of gross earnings for this Appellant in 1992, but there was no ROE from the Payor or DFO slips for this Appellant in 1992. The witness explained that if fisherpersons did not want a delivery to be considered as insurable earnings in 1992 he nonetheless recorded that sale by issuing a T4 slip to the fisherperson.
[224] If a person did not want a stamp the buyer was not required to make out an ROE depending on the value of the fish sold but he would make out a DFO slip. In this case the witness could not confirm that a DFO slip would have been made out to this Appellant in 1992.
[225] The witness was shown Exhibit B-13, tab. 1, pertaining to Elizabeth Lewis, in particular to her 1992 period of employment (under review, the 1993 period having been dropped). The witness stated that the DFO's and the ROE's of this person are accurate and correct.
[226] The witness was shown Exhibits B-14, tab. 1, tab. 3 and R-6, tab. 15, pertaining to the appeal of Paul Sharpe. The attention of the witness was drawn to a DFO slip No. B36099, dated October 2, 1993, (Exhibit R-6, tab. 5, p. 11), which is marked "no stamp". The witness said that this DFO slip would be an earning for the fisherperson but could not say why this Appellant did not want a "stamp". He did not know why these earnings would not be reflected on the record of employment for this person. He said that he would have to check with his bookkeeper but that the earnings would be on the T4 slip of the fisherperson.
[227] He defined a "stamp" as being a week of earnings for unemployment insurance purposes. The fisherperson in this case was requesting that the amount of his delivery not be considered insurable earnings for that week.
[228] It was the fisherperson who would indicate to the Payor when to deduct unemployment insurance premiums and when not to.
[229] He was not sure whether, in 1992 or 1993, he was supposed to deduct unemployment insurance premiums on every delivery.
[230] In being examined by the Court, he did admit that the ROE of this Appellant was incorrect because this person actually delivered fish on October 2, 1993, while the last day of delivery indicated on the record of employment is May 28, 1993.
[231] The witness was shown Exhibit B-15, pertaining to Carl Lewis. He said that he filled out the DFO slips dated September 19, 1992, October 2, 9 and 16, 1993. Although there was no DFO slip for July 17, 1993, he said that it would have been submitted to the accountant or he would not have been able to prepare the record of employment.
[232] He was shown Exhibit B-16, relating to Elmer Lewis. He identified two DFO slips dated July 8, 1993 bearing Nos. 331501 and 331502 made out separately to Elmer and Elizabeth Lewis (No DFO slip for July 17, 1993).
[233] He said that there was, at the time, a maximum and a minimum insurable week. If the amount of a delivery was less than the minimum insurable week, "there was no stamp" and no unemployment insurance premiums were deducted. He also said that if at the time of delivery no declaration was made, he would use a DFO slip and "you had to have it stamped".
[234] In cross-examination by the Respondent, the witness could not locate the originals of the daily delivery records (scribblers). He did bring to the Court three journals for 1992 (Exhibit R-20).
[235] He first stated that the scribblers were not his, that he never had a social insurance number in any of his scribblers. He had scribblers like the ones in the Court record in his fish building and it was either himself or Martin Smith who actually wrote in the scribblers. He told Martin Smith to fill in the names to cover the amount of fish "we shipped". The scribblers were kept for QMP purposes. He directed Martin Smith to put names in the scribblers because he would have been told by Justina Doucette of the Department of Fisheries and Oceans to do so.
[236] The scribblers were mostly kept in order to determine "the amount of fish that was shipped off island" and as long as he knew the area the fish come from, it satisfied the requirement for QMP purposes.
[237] The information entered into the QMP scribblers was taken from note pads that he no longer has. The only permanent record of the dates of delivery for each fisherperson would be the dates on which the DFO slips were made out. The fisherpersons were paid and DFO slips were made out at the time of delivery or later on in the week after several deliveries.
[238] The fisherpersons were not always paid at time of delivery. If they were paid, he would make a note of this in his notebook or give the fisherperson a slip of paper marked "paid", for the fisherpersons to bring back at the end of the week when the DFO slip was made up.
[239] He would not have, however, a permanent record of money going out to fisherpersons. Since most people came in every week, he could check his note pad and the slips of paper he gave to fisherpersons to make up the DFO slips in the proper amount.
[240] He had two separate note pads: in one he kept information pertaining to what he owed fisherpersons and in the other he entered the information required for QMP purposes.
[241] What he wrote in the QMP scribblers was "mostly what was shipped off the Island" and anything that was processed in the plant.
[242] The information in the scribblers should balance with the export papers.
[243] He admitted to have falsified the records but that there would be no difficulty in tracing the product back to the area it was fished. Most of the purchases that were shipped off the Island were in the QMP records but they are not under the right name.
[244] He had a pretty good idea of what he was buying and where it was going. What stayed on the Island was everything that was sold in the fish mart: lobsters, clams oysters and mussels, etc.
[245] Over the counter sales could reach a figure of more or less $2,000.00 a day. When asked where his break down for sales over the counter would be, he answered that these sales were put through the fish mart and some through the store.
[246] He provided all the sales information to the Respondent. He did not keep a cash disbursement journal. He maintained that the DFO slips would indicate the days and the amounts of money paid to individual fisherpersons.
[247] He could not remember what day he paid the fisherpersons. He admitted having no record, on a daily basis, of what came in to his plant. He also admitted giving receipts in the name of Sharbell's Irving.
[248] If he owed money to a fisherperson he could give a receipt containing a date, his signature and any money paid or owed. Unemployment insurance premiums should have been taken off the fisherperson's earnings at the office on the 15th of the month. He usually deducted unemployment insurance premiums from the fisherperson and the accountant remitted to Revenue Canada the total share, including that of the employer.
[249] If the DFO slip indicated "stamp paid" this meant that the fisherperson's share of premiums was paid. He would normally receive the fisherperson's unemployment insurance premiums when the DFO slip was made up.
[250] The DFO slips were not always marked "stamp paid". He said that his accountant would check with him for unemployment insurance deductions of fisherpersons or whether the DFO slip was marked "stamp paid" or not or does not indicate anything.
[251] If the amount of the DFO slip was over the amount of insurable earnings the fisherperson received a stamp. His sister Marilyn Enman was his bookkeeper in 1992. Doane Raymond was the accounting firm for the Payor in 1993.
[252] Once again cross-examined as to the accuracy of the scribblers, he said that the scribblers contained anything that was shipped out of province and not going to other processors. The fish that did not leave the Island could be 10 percent or some days 50 percent of what he purchased but he could not remember.
[253] HRDC took his QMP scribblers in 1994 but he did not know when he got them back.
[254] He had no reconciliation, no way of verifying that everything that came in to his plant was covered by a DFO slip. He was not 100% sure.
[255] Every week, he provided his accountant with the DFO slips, all the Payor's bills, the employee's records, everything from the business.
[256] If there were purchases that were not recorded in DFO's, the accountant would never have accounted for those transactions.
[257] The records of employment were prepared, from the DFO slips, by the accountant. If something was not marked on the DFO slip, the accountant's secretary would usually check with the witness. The witness could not tell with any certainty the dates on which the fish were delivered.
[258] In 1992, he was asked how the information, that someone would be using a boat was relayed to him? He answered that "if they were using a boat they usually all wanted to claim expenses" and he would likely take off the boat share.
[259] His attention was drawn to Exhibit R-7, tab.18, p. 9 and asked whether the fisherperson used a boat. He replied that he could not really be sure but a deduction was likely taken off. He then was shown Charles Wagner's ROE (Exhibit R-7, tab. 18, p. 8) with his insurable earnings in the amount of $710.00 each week. This was the maximum weekly amount of insurable earnings for fisherpersons. In this case, the witness could not say whether the use of a boat was indicated or not.
[260] The attention of the witness was drawn to Exhibit R-6, tab. 13, which is a page of the QMP scribblers. He replied that this page probably represented oysters that were being shipped off the Island (He thinks he started writing in the QMP scribblers in 1992). He said he was not sure what the entries mean. He did not know where he got the names in the scribblers and did not even know why they were marked in the scribblers. He did not know why the entries were done as they were; as far as he knows they were all marked "paid" once the DFO slips were made out.
[261]False names were put in the book because "we were just starting our QMP records and we didn't think it important at the time".
[262] Being examined by the Court at the end of the day, the witness revealed that he kept on him two separate little note pads. One was for DFO purposes and another for QMP records. For the QMP records he got the "figures or information off" his shipping papers and cross border papers.
[263] He said that one note pad was for QMP records and the other one for DFO slips that were not yet made out.
[264] In the QMP note pad he would have marked down the amount and type of fish, the date and the area the fish came from.
[265] The note pad for DFO slips would have the fisherperson's name, the date, the quantity of fish and the price. He would make up the DFO slips for fisherperson using his note pad. When a DFO slip was made up at the time of purchase, he made no notes in his note pad. When he used the note pad it was to make up DFO slips that covered deliveries made during the week. He would have given the fisherperson a slip of paper and would tell him to come back at the end of the week.
[266] He did not always make notes in his note pad. It would depend on the fisherperson. He trusted some more than others. He could rely on the fact that the person would return with the proper slip.
[267] If he advanced money to people, he would write that in his note pad.
[268] There was nothing about sales in his note pads. The sales books accurately reflect the sales going out. He had a sales book and if he sold something to a company or an individual he would make out an invoice.
[269] In the fish mart, sales invoices were not written up all the time. If someone came in and bought a small quantity of fish, this would be reflected in the sales of the store. When fish was taken from the fish mart and put in the store to be sold it was reflected in the fish mart sales.
[270] When fish left the fish mart to the store it was not tracked because it was marked in the fish mart sales, but if someone bought an item of fish and had an order of groceries, that sale would go through the convenience store.
[271] He said that to prepare the QMP scribblers, he used his note pad or his shipping records. The DFO slips have to be right and the ROE's were made out of them. The ROE's were made up at the accountant's office. You cannot use the delivery dates on the ROE's because they are dated at the end of the week.
[272] He admitted that Dale Rafferty delivered fish for his wife Sandra Rafferty. At times Dale Sharbell's sister, Marilyn Enman, delivered DFO slips.
[273] His attention was drawn to the T4 F for the year 1992 for Puis Bulger where gross earnings of $462.00 were indicated but no unemployment deductions made. The witness said that a DFO slip would be made up for that amount. The accountant did all the accounting. Some people paid their premiums at the end of the season for the whole year, while the Payor had remitted them the 15th of each month. Some paid their premiums every delivery, others paid their premiums every week (He identified a book of records of employment (Exhibit R-13)). He provided the fisherpersons with a slip of some sort. Fisherpersons would settle up with him every week.
[274] The cross-examination of the witness continued on January 25, 1999. He stated that he had five or six DFO books, either in the fish mart or at his sister's place. There could have been books with individual names on them. He had close to 100 fisherpersons selling to him and he did not have a book for each person. The little slips of paper given to fishermen by those employees that weighed the fish were in different forms. There was no record of actual purchases coming in on a daily basis.
[275] He was asked to look at Exhibit R-4, tab. 4, p. 23 and stated that the documents did not look like his but that sometimes it was just a small piece of paper. It is possible that some of these papers would not be brought back for a DFO slip.
[276] He was shown nine receipts of Sharbell Irving's which were filed as Exhibit R-16. He explained that slips like these could be given out if they had no note pads available. He was then shown Exhibit R-2, tab. 11, p. 194. While he was being questioned he repeated why certain numbers matched when comparing Exhibit R-16 to Exhibit R-2. He said that most of them are not "true records".
[277] He admitted providing cash advances to fishermen at times. He was then suggested a series of names and questioned as to whether he had any dealings with these individuals in 1992 or 1993 and was asked to produce a series of records of employment as Exhibit R-17.
[278] He never issued a DFO slip to someone unless he purchased fish from them. He did not know whether a Mr. Fitzgerald would have been provided with a record of employment for five weeks, having worked more than five weeks.
[279] He reiterated that most of the QMP records are incorrect.
[280] He said he did not remember giving DFO slips or records of employment "to anybody that didn't fish". He said he always recorded the name of the fisherman. He did not always record whether 25% should be taken off the DFO slip.
[281] He could not explain, when shown Exhibit R-18, why some DFO slips are consecutively numbered but dated on different days.
[282] The date marked on the DFO slip was the day when it was made out. DFO slips were not made up at the time of delivery but when they were requested. He also said that some fishermen probably received their DFO slips from his sister who did the book work and who ran the office.
[283] He said that if there was no DFO slip, or ROE or declaration for a fisherman it would indicate that, he did not sell any fish to his plant.
[284] A declaration was made out for every delivery in 1993.
[285] He could not really say what his over the counter sales were. Mothers day would be a big day, regular days could be anywhere from $2,000.00 more or less. These sales would not be significant when comparing them to his total sales figures.
[286] His sales to Aqua Farms could be included in the QMP scribblers but he was not sure whether only the off the island sales were included in the QMP records (p. 47).
[287] He said he had a "pretty good idea when DFO inspectors were coming" to his plant by talking to other plants.
[288] He could not recall having received Exhibit R-19 which was a letter from HRDC dated October 3, 1996.
[289] He said that Exhibit R-8, tab. 1 and tab. 2 would have been provided by his accountant.
[290] He was further cross-examined with the questionnaire he answered for the Respondent. He said the DFO slips would be a record of cash paid out for any fish that he purchased but not what was paid out on a daily basis.
[291] He said that the DFO slips were prepared at the time of delivery if a fisherperson made only one delivery in the week. If more than one delivery was made, the DFO slip would be prepared at the end of the week for all the deliveries made during the week.
[292] He produced the payroll books for the 1992 year which were made up by his deceased sister (Exhibit R-20). He explained that these books were used for listing the DFO slips and the ROE's for the fishermen.
[293] His attention was drawn to certain inscriptions made by his sister throughout the exhibit and could not confirm any meaning to them as suggested to him.
[294] He produced Exhibit R-21, which consists of a raw product inspection report, shipping record report and sales slips for exports and within province sales, which are used for his business. He said there should be a report for all the product going through his establishment. He said that if he was too busy he did not always prepare a shipping record report.
[295] He identified a sales slip that would show how he recorded his out going sales.
[296] No sales slips were made out for over the counter sales. He identified a sales slip for fish being sold off the island (Exhibit R-21, p. 5).
[297] He said he provided all his records to HRDC.
[298] He produced the annual report for sales of specified products for Sharbell's Fish Mart for 1993, dated January 17, 1995 (Exhibit R-22). He said these sales were estimates and were not accurate. He also said that, in 1992, he did not always record what the fishermen would tell to him when they delivered their fish and that the DFO slip was an official receipt for the fisherman.
3. Byron Murray
[299] It was admitted that if he were heard as a witness, he could confirm what was written in Exhibits B-17, tab. 3 and R-8, tab. 5, by N. Small, an employee of the accounting firm of Doane Raymond who did the accounting work of the Payor for the 1993 year.
[300] The ROE's of the fishers were issued by the Payor at the end of the fishing season and were based on the DFO slips. The accounting procedure for 1992 was carried out by Marylyn Enman, the deceased sister of Dale Sharbell. The accounting procedure for 1993, which was admitted into evidence prepared by N. Small for HRDC on December 15, 1994, can be found in part A - The facts disclosed by the documentary evidence.
[301] Pages of the 1993 payroll book for unemployment insurance purposes can be found in the Exhibit book relative to each Appellant in Exhibits R-28 to R-63 and in Exhibit R-8, tab. 4, pp. 1 to 20.
[302] The evidence established that the 1992 year pay records for unemployment insurance purposes were kept by the late Marilyn Enman, the sister of Dale Sharbell they were filed in the Court record (Exhibit R-20). Some of the pages of these records can be found in certain exhibits pertaining to some of the Appellants who are appealing the 1992 year.
4. Jason Gerard Bulger
[303] This person testified on January 20, 1999.
[304] He was an employee of the Payor.
[305] He worked for the Payor during the spring and summer of 1992 and 1993.
[306] He worked as a labourer. He pumped gas, weighed fish, packed fish, loaded and unloaded trucks and cleaned the fish building.
[307] His hours of work were from 8:00 a.m. to 8:00 p.m. and sometimes later, seven days a week.
[308] He worked with Martin Smith and Dale Sharbell.
[309] Martin Smith worked with him in the fish building.
[310] Dale Sharbell would be, most of the time, in the office part of the store and sometimes out in the fish building.
[311] The fish was weighed in the fish building.
[312] The fisher was present when the fish was unloaded and weighed by him.
[313] When he weighed the fish, he would "write it down on a slip of paper and the fisherperson's would take it to Dale Sharbell and get paid".
[314] He never paid a fisherperson.
[315] He tagged fish for shipping.
[316] When he would get a break from the fisherpersons delivering fish he would box fish, tag it and sometimes even in the same day load the truck.
[317] He would go into the store for something to eat when there was a break in the fish building and he would at times pump gas.
[318] On a nice day, there could be 50 to 100 fisherpersons delivering fish at the Payor's premises.
[319] He worked with Martin Smith and would weigh at least half of the daily deliveries.
[320] There would be line-ups of people delivering fish.
[321] He would issue to each fisherperson a separate slip of paper representing the fish that was weighed individually. He would indicate on the slips, the weight and the species of fish. If the fish had to be graded like oysters or quahaugs it was not in pounds.
[322] He guessed that a DFO slip for him represented what the fisherperson had sold.
[323] He said it was more or less a stamp.
[324] He never filled out a DFO slip.
[325] Martin Smith and Dale Sharbell would be the persons to fill out the DFO slips.
[326] He said that DFO slips were given to fisherpersons mostly in the store by Dale Sharbell.
[327] He could not say for sure when fisherpersons got paid.
[328] He said they were usually paid at delivery but he could not say whether that applied to everyone.
[329] He did not know whether DFO slips were issued at the time of payment.
[330] He knew what the QMP program was about but he never made any entries in the QMP scribblers.
[331] He never saw much of the work concerning QMP scribblers take place because he was usually out in the building, weighing, packing, loading and unloading fish.
[332] He knew most of the fisherpersons.
[333] He knew Donna Lewis and she delivered fish in 1992. He remembered her dropping off her clams. She would not always be alone. She would sometimes be with her husband or her children.
[334] She also delivered fish in 1993.
[335] He knew Janet W. Arsenault and she delivered fish to the Payor in 1992 and 1993.
[336] In cross-examination, he said that the slip of paper that he gave to fisherpersons had the weight, the type of fish and sometimes the name of the person delivering.
[337] If Dale Sharbell knew the person, the name need not be on the slip of paper.
[338] He would not write the price of fish because it was Dale Sharbell who was running the business and would know the price.
[339] He remembered Elmer Lewis but he did not know whether he delivered fish in both 1992 and 1993 years.
[340] He did not know Iris Lewis.
[341] He knew Keith Lewis and, as far as he could remember, he was at the plant both years, in 1992 and 1993.
[342] He remembered Loman MacLean and, as far as he knew, this person would have delivered fish.
[343] He said Keith Lewis delivered fish.
[344] Myles Smith delivered fish in 1992 and 1993.
[345] He was not sure whether Paul Waite was delivering fish in 1992 and 1993. He was not sure of the years but he knew Paul Waite had sold fish to the Payor.
[346] He knew Dale Rafferty whom was sometimes with his wife Sandra Rafferty.
[347] If husband and wife arrived together and they said there was two different amounts they would receive two slips.
[348] If there was only one amount, he would give one slip.
[349] If husband and wife did not ask for a separate slip they did not receive separate slips.
[350] He remembered John Arsenault delivering fish but was not sure if he delivered in 1992 and 1993.
[351] He recalled that there were fisherpersons who were steady customers delivering in both years like Janet W. Arsenault, Donna Lewis, Keith Lewis.
[352] He remembered Allan McInnis delivering fish but was not sure in what years.
D- The Appellants
[353] Fifty four Appellants were heard.
[354] The Appellants all testified to the effect that they had no participation in the making of the QMP scribblers.
[355] The Appellants who delivered their fish for unemployment insurance purposes, received DFO slips for their deliveries which they considered as their official receipts.
[356] These Appellants received their ROE's from the Payor at the end of the fishing season and filed for unemployment insurance benefits accordingly.
[357] Other Appellants who did not deliver to the Payor in 1992 and/or 1993 did not receive DFO's or ROE's.
[358] The evidence of each Appellant however, is summarized in the concluding analysis of these Reasons for Judgment pertaining to each Appellant in particular.
E- The Rulings Officer, Gary Robbins.
[359] On or about the month of March 1995, he was assigned by his superiors, along with a co-worker, Roweena MacKinnon, to attend interviews of fisherpersons who had sold fish products to the Payor in 1992 and 1993.
[360] These interviews were conducted by two investigators of HRDC: Lew Stevenson and Joe Pierce.
[361] He attended and took part in about 100 interviews at the offices of HRDC for about one month.
[362] The purpose for attending the interviews was to hear first hand what was being said. He understood that the files of the fisherpersons would eventually be submitted to his office for ruling decisions.
[363] During the interviews, he made notes and took possession of documentation presented to the investigators by the fisherpersons. The majority of fisherpersons claimed that their DFO slips and records of employments issued to them by the Payor for the 1992 or 1993 years were correct and they had no knowledge of the existence of the Payor's QMP records.
[364] Some fisherpersons admitted that their DFO slips and records of employment issued by the Payor were false, none of them were Appellants.
[365] One person admitted not having fished or sold to the Payor. Another admitted to having sold over a longer period of time than what was indicated on his record of employment issued by the Payor. This person also agreed that a portion of the QMP records related to some of his deliveries.
[366] One other person was issued a record of employment in 1992 for 10 weeks of fishing oysters and was not recorded in the Payor's QMP records (p. 42 and foll. of the transcript of March 10, 1999).
[367] Approximately ten persons made these types of admissions.
[368] On or about the end of March or in April of 1995, Gary Robbins was instructed to discontinue attending interviews with HRDC investigators.
[369] He guessed that this involvement in the interviews was halted because maybe the appearance of an independent investigation was being compromised (pp. 17, 18 of the transcript of March 11, 1999).
[370] On or about September 6, 1995, he began his own investigation. He received from HRDC six files for which rulings decisions were requested of him.
[371] He contacted Adrian Doucette, a Fisheries Inspections Officer, who advised him about the QMP program for fish plants.
[372] He met with the accountant Byron Murray and Dale Sharbell of the Payor.
[373] He was told by Dale Sharbell that the QMP records were falsified and told how it was achieved to satisfy the requirements of DFO. He also stated the accurate records were the DFO slips he issued to the fisherpersons which were used by his accountant to make up the records of employment.
[374] He did not believe Dale Sharbell and his falsification of QMP records because the Payor's plant could be closed down and the QMP records appeared to convey too many details to be false.
[375] In order to carry out his analysis, he compared the purchases of the Payor according to the DFO slips issued by the Payor (Exhibit R-64, tabs. 1 and 2), the entries made by the Payor in the QMP scribblers (Exhibits R-1 and R-2) and the sales records of the Payor for out going fish. He also had in his possession individual ledger record sheets for fisherpersons made up by the Payor's accountant. The ledger sheet for each individual fisherperson listed the name, social insurance number, numbered DFO slips, earnings, deductions and calculations of net pay of the individual.
[376] He compared the Payor's tax returns and income statements to the Payor's sales that he obtained from the source documents he had in his possession.
[377] The comparison showed some $93,000.00 more sales reported in the Payor's income tax return than the total of sales in the Payor's invoice books.
[378] He did not know for what species of fish these extra sales would cover as Dale Sharbell did not provide any further documentation as requested.
[379] The results of his analysis are compiled in Exhibit R-64, tab. 7, pp. 1 to 8.
[380] These results concerned only the species of fish which were listed in the Payor's QMP records such as eels, oysters, bar clams, soft shell clams and quahaugs.
[381] The Payor's business also dealt with other species such as lobsters, flounder, mussels and smelts etc., which he said were not governed by the QMP program.
[382] He explained that he was attempting to determine which records were more accurate between the DFO slips issued to the fisherpersons and what was recorded by the buyer in the QMP records.
[383] His rulings concerned only those fisherpersons who had sold a species of fish that was reported in the QMP records. No ruling decisions would change the earnings of fisherpersons who sold a species of fish not required to be included in the QMP program.
[384] He concluded that the QMP records were reliable to establish the earnings for periods when the purchases listed in them closely matched the Payor's sales invoices for the same periods (Exhibit R-64, tab. 6, pp. 1 and 2).
[385] He concluded that the QMP records were not reliable for periods when the Payor's sales invoices exceeded the purchases described in the QMP records for those periods.
[386] He prepared a "QMP Reliability" chart (Exhibit R-64, tab. 6) indicating years, weeks and species. This chart showed the QMP records as being reliable to establish earnings for the years and periods indicated by a dark shaded area. The QMP records were determined unreliable to establish earnings in areas marked with an "X".
[387] He then ruled that a fisherman's DFO slip would not qualify for earnings if the date of landing was within the dates when the QMP scribblers were reliable. The DFO slip, however, was accepted if the landing was determined to be within periods when the QMP records were not reliable.
[388] Mr. Robbins described his options as follows:
"Q. Okay. Now, in terms of the rulings that were made with these Appellants, can you tell me what the options you had in making the rulings were?
A. Well, there was -- the two options that I worked on were determining which set of records to base the determination -- to calculate the earnings and allocate the earnings, to decide on whether the QMP or the DFO were the more accurate. Without being able to select one of them, then there was nothing to -- on which to base the earnings.
Q. Okay. What about records from individual Appellants, was anything provided by individuals?
A. Yes. They had their DFO slips, their Records of Employment. At the ruling stage, I believe that was mostly what we received was copies of their tax returns that showed expenses. I think that was the -- you know, the normal documents that they provided.
Q. Okay. And then just getting back to -- and any documents that they provided, were they taken into consideration?
A. Yes, they were taken into consideration. I mean, we asked for anything that they had, and we took whatever they provided, and it was incorporated into the file, and noted that that's what they did provide.
Q. And in the end result, each individual person was ruled on, individually, based on what they provided and on the analysis that was conducted, is that true?
A. Yes.
Q. Okay. So, in the end, with the two options that you had, you were looking at the DFO slips, and you were looking at the QMP scribblers. We have, contained at page 6, and we've referred to this a few times, that's the chart and then the graphical representation of the results that you ---
HIS HONOUR
Just a minute, what was it you said, "With the two options" -- what was his two options?
MS. GILLIS
Two options, QMP scribblers and the DFO slips.
HIS HONOUR
Okay. Go ahead, ma'am.
BY MS. GILLIS
Q. Of those two options that you were looking at in terms of determining what was reliable, the chart contained at Tab 6, does that accurately reflect the conclusions that you came to, based on all the analysis that you conducted?
A. Yes.
Q. Okay. So this formed the basis of the rulings that you and Ms. Evelyn Younker compiled for these Appellants?
A. Yes. This is a summary of the periods that we determined what records were accurate, and when they weren't. And we applied each individual case to this.
Q. Okay. Now, Mr. Robbins, I understand that the only other option that you had to those two, that is going with the DFO slips or going with the QMP scribblers, would have been to not give these people anything.
A. That would be a third option that we avoided.
Q. Okay. So that's not something that you did.
A. Right.
Q. You didn't take away everything from these people.
A. That is correct.
Q. Okay. Now, why was it -- you said that you avoided it. Why was it that you avoided that option?
A. Well, the DFO records that -- in cases where an individual claimed the DFO records were correct, we made changes to those amounts when it fit into these periods where the QMP records were shown to be more accurate. And when the records -- when the DFO records fell in the periods where the QMP records could not be shown to be the more accurate, then they were allowed to keep what was originally on their ROEs.
Q. Okay. So it would be fair to say that you didn't want to take away everything from these people.
A. No. And it's not like I went into this wanting to take weeks away. I had to come up with a way of allocating earnings and determining earnings, in a consistent manner, and this was the way that it was decided to do it.
Q. Okay. "
(pp. 162 to 166 of the transcript of March 10, 1999)
[389] He sent out questionnaires to the fisherpersons. He did not interview any fisherpersons after he began his own investigation.
[390] He was cross-examined by the lawyers and the unrepresented Appellants.
[391] He said he made his rulings without considering the statement of Martin Smith.
[392] He was told by Adrian Doucette that there was confusion and many mistakes made at fish plants in the first two years of the QMP program.
[393] He said he did not find records of the Payor concerning contaminated resale of product.
[394] He examined records of P.E.I. Aqua Farms, who bought product from the Payor. The records of P.E.I. Aqua Farms matched those of the Payor.
[395] He said that he would not have been surprised to see pressure put on Dale Sharbell by the community to produce records, if they existed, as a result of the rulings being carried out on the fisherpersons.
[396] Many fisherpersons had told the Rulings Officer that they would be contacting Dale Sharbell about his records.
[397] He agreed that the fisherpersons were not responsible for the record keeping of the Payor.
[398] He said he factored into his analysis whatever records the Payor had. He did not know whether they included contaminated oysters. He could not have factored in missing records.
[399] He had no background or training in statistics.
[400] He did not factor into his analysis over the counter sales. He did not know what numbers could be allocated for that. He understood that over the counter sales would be small amounts.
[401] He was not provided with information concerning sales of fish in the Payor's store.
[402] He did not consider the sales from the Payor's store in his analysis because he had no idea what the sales would amount to and there was no record to verify them. Dale Sharbell had told him that it was not a large amount.
[403] He did not verify records of other fish buyers who would have sold product to the Payor such as Cocagne, Summer or Carr's.
[404] He did not factor, into his statistics, fish sold to the Payor from other buyers to fill some of the Payor's orders because those quantities of fish would not have to be recorded in the Payor's QMP records.
[405] He wanted to know what was fished by the fisherpersons, whether the ROE's were correct and if the fishermen were paid.
[406] He said he did not have the fisherpersons' actual DFO slips when he made his rulings. He assumed that if a person had an ROE they would have DFO slips to support each of the entries therein (p. 75 of the transcript of March 11, 1999).
[407] He admitted that he had some doubts about the QMP records. He did not believe that all the QMP records were accurate but a portion of them was more accurate than the DFO records he had (p. 97 of the transcript of March 11, 1999).
[408] He said the problem with the file of Claudette Gallant was that her DFO slips were not considered as accurate as the QMP records. This was the reason he established her earnings using the dates and amounts listed in the QMP records. The QMP records were another set of records which disputed her DFO slips.
[409] In re-examination, he said he took his own notes at the interviews he attended with HRDC investigators.
[410] He came up with his own conclusions in relation to what he had heard at these interviews.
[411] He conducted a further investigation by sending out questionnaires and speaking to third parties during the ruling stage.
[412] He attended the interview of Martin Smith with HRDC investigators.
[413] He did not think that there was anything significant about what Martin Smith had to say in relation to his duties as an employee of the Payor.
[414] He explained, in producing Exhibit R-21, what he considered as species packages that had been prepared by the investigators of HRDC.
[415] These species packages were made up of raw inspection reports, shipment record reports, the Payor's sales, the sales slips and custom's clearance reports.
[416] He was not aware of what was sold in the convenient store. He assumed that the Payor sold more than clams.
[417] He proceeded without records of over the counter sales because he did not think that these sales were of much significance.
[418] He did not know how many inspections were carried out by Adrian Doucette or Justina Doucette, the two DFO inspectors, who would have carried out QMP inspections at the Payor's premises in 1992 and 1993.
[419] He compared the QMP shipping report to the sales invoices to show what was inspected and shipped. It matched with what was actually shipped by the Payor.
[420] He said the shipping record report compared favourably and corresponded to the amount of sales. This comparison did not however take into consideration over the counter sales.
[421] However, he did see in, a few instances, on some inspection reports a note which would have indicated "no shipping record for this lot sold over the counter".
[422] In further cross-examination, he said that the method he used to ensure the accuracy of the QMP records was to compare the QMP records and the DFO records to a third set of records which were the sales records.
[423] He said there was no percentage of error determined. When the QMP records corresponded to the sales records, he considered the QMP records to be accurate for those periods.
[424] When the QMP records did not match the sales records of the Payor, he used the DFO slips of the fisherpersons to determine their insurable earnings.
[425] He was referred to an undated report from HRDC (Exhibit R-64, tab. 3) that suggested that 10% of fisherpersons interviewed would have admitted to having received false records of employment from the Payor.
[426] He said that the document from HRDC (Exhibit R-64, tab. 3) was prepared after Revenue Canada was involved in making rulings. He was aware that a small percentage of fisherpersons did make admissions of the kind described but he did not know whether the percentage was 10%.
[427] He admitted that the Payor had declared in his income tax return for 1993 a sum of $93,029.42 for which no sales records were produced nor found. During the period of March 1, 1993 to February 26, 1994, the Payor showed total sales in the amount of $1,035,161.00.
[428] It was suggested to him that there would be a discrepancy of approximately 10% of missing invoices.
[429] He was asked whether the discrepancy could have affected his final conclusions as to the accuracy of the QMP records for that year.
[430] He said that if the percentage of missing sales involved the sale of maquerel, caspereau, flounder, lobsters or other species that were not covered by the QMP records, it would have no effect on his analysis. However, if the percentage of error was for the species and periods reported in the QMP records, it would have an effect on his conclusions (p. 178 of the transcript of March 11, 1999).
[431] He said he had no way of knowing for what species or what periods this discrepancy would be attributed but if a 10% inaccuracy would be attributed to the species and periods he was dealing with, it could seriously affect the validity of the QMP records. This was the reason why he went to the effort of trying to obtain from Dale Sharbell any and all sales information he had in his possession.
[432] He was then asked how if such a discrepancy existed he could make sure that it would not have a negative effect on the accuracy of the individual fisherpersons when ruling on his insurable earnings.
[433] He explained that the fisherpersons could maintain a set of records of their own that would correspond to the information in the Payor's records rather than rely on someone else's record keeping such as the Payor's.
[434] He believed that none of the fisherpersons had access to the QMP scribblers.
[435] He said that fisherpersons who claimed not to have sold to the Payor, while the QMP scribblers revealed their names, were ruled upon in the same way as those who had records of employment with the Payor and were given insurable weeks.
[436] He explained what he thought a fisherperson could have had to support their DFO slips on page 188 of the transcript of March 11, 1999:
"I think that if you had a situation where someone who had a record, you know, a daily record of what they fished and where they fished and the amount they caught, the amount they sold and you compare that to what is on their DFO slips you know that would be an example of a pretty believable set of records that would support the DFO records and I think at the appeal stage people did come forward with some information like that at appeals and it was accepted."
[437] He also said if a person's name was in the QMP scribblers and he had no proof that person was somewhere else or doing something else during the periods when deliveries were shown in the QMP records under his name, he probably would have been ruled with insurable earnings (pp. 188, 189 of the transcript of March 11, 1999).
[438] He said that a fisherperson had to explain his presence or his absence from Sharbell's fish plant if the name of that person was in the QMP records.
[439] He said that if the Payor was actually creating a false set of records for DFO to keep the inspectors off his back he could have created records with much less detail.
[440] He said that the details of the QMP records "lended" more credibility to them.
[441] He admitted that he never came up a with a degree of accuracy plus or minus in his analysis.
[442] At pages 206 and 207 of the transcript of March 11, 1999, he replied in re-examination to the following questions:
"Q. And again, I just want to qualify; and that is what's shown in that chart?
A. Yes.
Q. Okay. Now, if a fisherperson had maintained and shown to you his own independent detailed records -- and say this is Mr. Shawn Perry, who also fished for other people -- we had shown you his own independent detailed records showing that he fished and sold somewhere else other than Sharbell's, would you have considered that?
A. And he didn't sell to Sharbell's, is that the one that ---
Q. He's claiming he didn't sell to Sharbell's in this instance. And I'm saying , if he had independent records of his own ---
A. It definitely would have been considered. That information would have been taken into consideration in doing the ruling.
Q. And if his records indicated he fished "X" on this day, sold to another buyer and everything reconciled out, would he have been ruled against or ruled with insurable earnings for Sharbell's?
A. He may have been ruled insurable earnings but chances are he wouldn't be here today after the appeals process.
Q. Okay. SO, what you're saying by that is there's a lot of people who were given consideration based on their own independent facts that aren't here today ---
A. Yes.
Q. --- because either they were believed ---
A. Or provided some sort of explanation or - you know, basically explanations or - I saw, in some cases, receipts that showed that they were fishing when their DFO slips said they were fishing, so appeals gave the benefit of the doubt to them.
Q. Okay, So, each person's ruling was independently looked at?
A. Yes. "
[443] In re-cross-examination he was again asked what records would be acceptable for a fisherperson to prove his insurable earnings at the ruling stage. His reply was as follows on page 217 of the transcript of March 11, 1999:
" MR. ROBBINS, CROSS-EXAM. BY MS. RUSSELL
Q. Well, could you tell me, Mr. Robbins, what exactly - what records would be acceptable to prove insurable earnings at the rulings stage?
A. Well, the example that I used was someone who had kept a record of what they fished and when they fished it and who it was sold to and if they sold it to a buyer who issued a Record of Employment and the dates and the amounts and the earnings matched up with what their personal records indicated, then that would be a good record to support their ROE and their DFO slips.
Q. And if records of delivery dates were remitted, then that person's earnings were accepted. Is that what you're telling me?
A. I don't recall anybody ever providing records like that. I'm saying that would be an example of something that would be considered.
Q. Okay.
A. The only thing - at the ruling stage, the only thing that I can recall being submitted is the DFO slips. You know, there may have been one or two other people who had something. I'm not saying nobody provided anything, but the majority of them, that's what they submitted as proof of their sales."
[444] He said that he could not recall any fisherperson providing records of the kind he had just explained. He could only recall fisherpersons submitting DFO slips as proof of their sales, the majority being in that situation.
[445] He did not work out an average mark up on every species of the Payor's sales for the seasons under review.
[446] He explained what was meant when he concluded that one set of records more closely matched another set of records. There was no formula; if a difference exceeded a certain level then it was going to be accepted or not. If there was a trend over a few months of one set of records being closer than another set of records, he would accept the closer set.
[447] He said that if a fisherperson had a record of employment from the Payor with DFO slips for the sales but that person's name was not in the QMP records, no insurable earnings were given to that person if the sales were within the periods of QMP reliability for that species. If the sales were in the periods of unreliable QMP records, the fisherpersons were given their insurable earnings in accordance with the sales reported on the DFO slips submitted.
[448] He was referred to Exhibit R-64, tab. 7, p. 2 which indicates "1992 oysters'. He said that he did not know how the Department of Fisheries and Oceans converted the quantity of pecks into pounds. He did not know how many pounds there were in one peck.
[449] He said he was not able to obtain all the DFO books (Exhibit R-13) which were available to the Payor in 1992 and 1993. He could not find out for instance how many or what numbered books were not used by the Payor. The DFO slips from the accountant were not compared to the copies in the Payor's DFO books.
[450] He said the DFO slips would be the only documents the fisherman would receive from the buyer to show his or her deliveries.
[451] The fact that the fisherperson kept his DFO slips for a period of two to three years was not sufficient as a proof of sales.
[452] He stated that when he saw the word "stamp" on a DFO slip, this was an indication that the fisherperson wanted the sale to be included in his insurable earnings. When the DFO slip indicated "no stamp" it was an indication that the fisherperson had refused the sale as insurable earnings and no premiums would be deducted for unemployment insurance purposes.
[453] He said that for earnings to be insurable a declaration had to be completed. If no declaration was completed those earnings would not be insurable.
[454] He said that he was not sure of all the details a fisherman's declaration to the buyer should contain.
[455] He said that the practice between the fishpersons and the buyers is that fisherpersons are able to refuse earnings as insurable earnings.
[456] He said, however, that if one is to consider the DFO slip as a declaration made to a buyer, the amount of the sale would be insurable earnings and cannot be refused by the fisherperson.
[457] An Appellant, Rodney C. Milligan referred the Rulings Officer to Exhibit R-30, p. 13 which shows a name at the top and other inscriptions below.
[458] He explained the contents of the page which contained no social insurance number, no address, no telephone number.
[459] He said the Appellant was identified by name and it could be any other person with the same name. He also said that he did not know whether this Appellant had sold to the Payor the year before which could have led him to be the person described in the QMP record.
[460] He said that the appeals to Revenue Canada were the process to follow if fisherpersons wished to have any changes made to the ruling decisions.
F- The Appeals Officer
1. Lynn Loftus
[461] This witness was heard for the first time at the hearing on March 12, 1999.
[462] She was also heard on several other occasions throughout these hearings.
[463] She was the principal Appeals Officer who worked on what she identified as Sharbell's Fishmart Project.
[464] She prepared what she identified as a CPT 110 report. This report contained common information which was applied to the appeals of all the Appellants in particular. This report is found in Exhibit R-64, tab. 11, pp. 1 to 15.
[465] She kept a diary (Exhibit R-64, tab. 12) concerning her activities which covers the period from February 29, 1996 to June 11, 1997.
[466] She filed a report which she sent to her Head Office in Ottawa (Exhibit R-64, tab. 13).
[467] She filed a formula for calculating insurable earnings of the fisherpersons which was made up on June 19, 1996 (Exhibit R-64, tab. 14).
[468] She filed what was described as a volume analysis which she prepared for determining which set of the Payor's records she decided the Appeals Division of the Respondent would use in establishing the insurable earnings of the fisherpersons in general and the Appellants in particular (Exhibit R-64, tab. 15).
[469] On or about the end of February 1996, she was instructed by Walter MacDonald, the Chief of Appeals of the Respondent, that several appeals were being filed at their offices.
[470] The appeals were made by fisherpersons who had sold to one buyer in particular, Sharbell Fish Mart. A total of 110 to 120 appeals were filed.
[471] She was assigned four other officers to assist her in making the determinations. These officers were Rosemarie Ford, Patricia Griffin, Don MacLain and Elizabeth White.
[472] These officers were assigned their respective files.
[473] She was requested by the Chief of Appeals, because of the numerous appeals being filed, to make a review and determine what approach should be taken by the department of appeals.
[474] She said that she did a basic original review and met with the other four officers to discuss what the fisherpersons were up to at a certain point.
[475] She met with the other officers every week or so, at the beginning, to discuss what each officer was finding.
[476] Each officer was independently responsible for contacting the Appellants to gather information and make their own recommendations.
[477] She explained the preparation of her CPT 110 report. This report outlines the parties contacted, the methods used in gathering the facts, the findings of facts common to all the files, the maximum and minimum insurable earnings for the 1992 and 1993 years, the basis of the rulings, the basis of the Appeals Officer's recommendations and a final summary (see Exhibit R-64, tab. 11).
[478] She enquired as to what the QMP program was supposed to accomplish and how the Payor had applied it.
[479] She said she reviewed the statements of Dale Sharbell and Martin Smith and what was found in the Payor's records (p. 78 of the transcript of March 12, 1999).
[480] She spoke with the Rulings Officer, Gary Robbins, as to what took place at his level of the decision process.
[481] After the discussion she wondered what was going on. What was said "didn't make any sense" to her.
[482] She then had a discussion with the Chief of Appeals, Mr. Walter MacDonald.
[483] They both decided that a volume analysis would be carried out as opposed to a dollar analysis that had been done by the Rulings Officer.
[484] The reason was the fact that she was dealing with different species of fish, different prices per pound and the mark up was different.
[485] She said that she had to simplify the analysis to make it easier to analyze pounds, pecks and other units of measure.
[486] She attempted to contact the partners of the Payor, Dale and Blake Sharbell, but the telephone was disconnected.
[487] She prepared and sent to both partners a questionnaire.
[488] Within the next few days she was contacted by the lawyer of Dale Sharbell, Mr. Bernard McCabe of Summerside.
[489] She was informed that Dale Sharbell was the main person that looked after the fish mart of the Payor.
[490] She was told by Mr. McCabe that her questionnaire would be completed and he requested a meeting with her.
[491] The questionnaire she received from the Payor raised further questions.
[492] She and Walter MacDonald went to Summerside and met with Mr. McCabe and Dale Sharbell.
[493] She questioned Dale Sharbell in order to clarify certain responses in his questionnaire. She requested that he provide all his records of purchases and sales.
[494] It was suggested to her by Mr. McCabe to contact the Payor's accountant.
[495] She said she asked on a number of occasions for more information.
[496] She said she was basically told that she had all the documentation concerning the purchases and sales invoices.
[497] She said she had what the Rulings Officer had. She thought that maybe there would be more documentation.
[498] She contacted DFO and obtained a printout of the DFO slips of the Payor for 1992 and 1993 years (Exhibit R-64, tabs. 1 and 2).
[499] She explained that these yearly printouts indicated on a monthly basis the quantities and species of fish landed for a particular area. The information was obtained from the DFO slips of the Payor.
[500] She prepared a summary of pounds purchased by species from the printouts.
[501] She then made a summary of the species as listed in the Payor's QMP records.
[502] She compared both results as she described in Exhibit R-64, tab. 15, which is entitled "Sharbells' Fish Mart Comparison Purchases to Sales 1993". She said that the purchases represented the sales from the fisherpersons to the Payor and also those of the Payor to its customers.
[503] She was trying to make the DFO slips match or closely match the Payor's sales in allowing such things as spoilage or breakage.
[504] She said that when she had finished her analysis neither the totals of the DFO slips in the printouts nor the totals of the QMP records matched any of the totals in the sales of the Payor.
[505] Her conclusion from her analysis left her with the opinion that the Payor's records were inadequate.
[506] She said that the DFO slips and the QMP records were not adequate and she was not too sure about the Payor's sales.
[507] She said "there was something radically wrong with the DFO's, the QMP's and everything".
[508] She explained to the Court the analysis of quantities and dollar figures shown in the separate columns found in Exhibit R-64, tab. 15, p. 2).
[509] She concluded from this report that the Payor must have been in a great loss position to have purchased for instance $66,320.00 worth of clams and only sold $45,000.00 worth in 1993.
[510] She then reviewed the Payor's income tax return and realized that the partners of the Payor showed a profit.
[511] She concluded that the purchases recorded from the DFO slips in the printouts were excessively higher than the sales. The purchases according, to the QMP records, although higher than the sales were not as excessive as the DFO purchases.
[512] After reading her conclusions it was decided by the Department that it was necessary to contact the Appellants.
[513] The reason was to attempt to obtain more records and information from the Appellants in order to determine their insurable earnings.
[514] The determination would be based on whatever information the Appellants had since section 80 of the Act required her to make a determination of the insurable earnings of the Appellants by estimating their earnings if the Payor's records were inadequate.
[515] She and the other Appeals Officers prepared a generic questionnaire.
[516] This questionnaire could be tailored to each individual Appellant to obtain the desired information.
[517] She said that additional information was obtained in a good many cases and was considered on an individual basis.
[518] She gave as example the case of the Appellant, Claudette Gallant.
[519] In the case of this Appellant she allowed two weeks of insurable earnings for December 1993 because information was provided that the Appellant was hospitalized after her deliveries to the Payor in October and had not received, until December, her DFO slips and the payment for her catches.
[520] She also said that some fisherpersons showed a calendar or slips from Sharbell Irving with dates, pounds or units delivered, in the handwriting of Dale Sharbell. These records were considered and accepted.
[521] She said that any credible records that the Appellants had were accepted.
[522] She said she was not satisfied that the information she obtained from Dale Sharbell was everything he had.
[523] She said that what she was required to do was to find out what records most closely matched the Payor's sales. Was it the QMP or the DFO records?
[524] She determined that her study agreed with the reliability chart (Exhibit R-64, tab. 6) made up by the Rulings Officer (p. 110 of the transcript of March 12, 1999) and that she would estimate insurable earnings and weeks based upon it.
[525] She was not satisfied that the QMP records were 100% accurate.
[526] She chose to accept the QMP records as accurate and utilize them for the periods where the purchases therein more closely matched the Payor's sales.
[527] She said that the DFO slips could not be used in the above periods because a number of fisherpersons (not Appellants) had admitted that their DFO slips were not accurate (p. 111 of the transcript of March 12, 1999).
[528] On March 12, 1999, when re-examined, she described the options she had as follows (p. 112 of the transcript of March 12, 1999):
"Q. --- appeals? Now, Ms. Loftus, can you tell us what were your options for these Appellants? What could you possibly do for them?
A. Well, actually one of the options was to make nothing insurable, no weeks, no earnings, because the records weren't reliable enough. But we didn't want to do that, not with that number of people, for sure. So what we did was do the best that we could to make -- give them as many weeks or as many dollars as we could. And the options were to follow this chart and to interview or to obtain additional information from them, find out which area they fell into, and estimate the earnings and the weeks. In other words, we gave benefit of doubt to everyone.
Q. That would be for the periods where the QMP scribblers were not ---
A. Where the QMP scribblers didn't match, then we just accepted the DFO slips because there was nothing to refute them and --- "
[529] And further on March 12, 1999, she explained what she did in certain situations:
"Q. Now, the question was put to Mr. Robbins yesterday regarding somebody who claims they didn't fish and sell to Sharbell's is found in the QMP records and given weeks. The question was put, what could they possibly provide to refute that. Can you tell me -- can you provide an answer to that question?
A. Actually, that boiled down to common sense. What we looked at in a situation like that was, if somebody was drawing benefits from UI, for example, or if they were receiving Social Assistance payments or something along those lines, and they said, "Well, no, I don't -- didn't sell any fish at that time," and yet their name appears in the records, there would be a benefit to them not to have their name in the records. So their credibility then came into question. Or if you had somebody who was working at another job and perhaps didn't want the income to show up on their income tax. There were all kinds of reasons. If there was somebody who was not working and didn't have any source of income and their name didn't appear in the -- or they didn't have any DFO but their name appeared in the QMP record, then the question was asked of them, "What was your source of income at this time? What were you living on?" And if they had no visible means of support, then that also led to a question of credibility.
Q. Okay. Were those people dealt with on an individual basis?
A. Yes, they were.
Q. Did anybody provide records in those instances that satisfied you that they could not have fished and sold to Sharbell's?
A. Yes.
Q. So there were instances where records were provided ---
A. Yes.
Q. --- to refute that.
A. And those people aren't here today. "
[530] On April 6, 1999 she again discussed her options and how she made her decision as follows (pp. 100-101 of the transcript):
"Q. Regarding QMP records, you were asked -- specifically people were not considered if there were -- sorry, you were asked about QMP scribblers and questioned regarding lobsters and flounders, and apparently QMP scribblers did not exist for those.
A. That's right.
Q. If QMP scribblers had not existed for anything, what would have happened with these Appellants?
A. Probably the existing records would have been left stand.
Q. Okay. What was the option -- I understand that obviously you didn't go with DFO slips. Why didn't you go with DFO slips?
A. Because there was doubt cast upon them. There was people who had admitted that they had been issued falsely. They weren't agreeing with the records that they should have agreed with. There were many reasons why the DFO weren't considered.
Q. Okay. So you ---
A. Sorry, they were considered where the QMP records did not agree. The DFO slips were ---
HIS HONOUR
She said this many times.
MS. LOFTUS
Yes.
MS. GILLIS
Yes.
HIS HONOUR
This has been, you know, said many times.
BY MS. GILLIS
Q. If DFO slips weren't used and QMP scribblers weren't used, what was the other option?
A. We could have denied everything."
[531] She said that the only option she had for the Appellants was to make nothing insurable and give them no earnings because the records were not reliable.
[532] She said she did not want to do that because of the number of people involved.
[533] She said that the Department attempted to give the Appellants as many weeks and as many dollars as it could.
[534] The option was to interview the Appellants, obtain additional information from them, determine, according to the chart (Exhibit R-64, tab. 14), during what period the DFO slips fell into and estimate their insurable earnings and weeks.
[535] She said that when the QMP records did not match sales in certain periods, she accepted the DFO slips of the Appellants because there was nothing to refute them (p. 113 of the transcript of March 12, 1999).
[536] She said that when she finalized the volume analysis and after having spoken to nine or ten Appellants, she reached the conclusion that none of the records matched, that she was going to have to estimate earnings, and then prepared a report to Headquarters for direction (Exhibit R-64, tab. 13) on May 30, 1996.
[537] She was instructed by Headquarters that the Fishermen's Regulations, extended to a class of self-employed persons who would normally not participate in the plan and had to be interpreted narrowly.
[538] Each case must be considered individually as credibility is highly related to the decisions (Exhibit R-64, tab. 11, p. 14).
[539] The Appeals Officers, she said, gave the benefit of the doubt to everyone of the Appellants.
[540] She said that the facts surrounding the situation of a particular Appellant would boil down to common sense.
[541] She said that she would look to see if the Appellant was drawing unemployment insurance benefits or receiving social assistance. She said if such an Appellant claimed he had not sold any fish to the Payor and his name appeared in the QMP records, it would have been a benefit to him not to have had his name in the QMP scribblers because the credibility of such an Appellant would be questioned.
[542] She said in a situation where if someone was working at another job and did not want other income to show up on his income tax could be another situation questioned.
[543] She said that if someone was not working and had no DFO slip but that person's name appeared in the QMP scribblers, the sources of his or her income would be questioned.
[544] She said that if such a person had no visible means of support it would also lead to a question of credibility.
[545] She said certain persons whom were not in Court, provided records to demonstrate that they had not fished and sold to the Payor.
[546] She identified the payroll pages for 1993 (Exhibit R-8, tab. 4) which was prepared by the accountant of the Payor.
[547] This payroll listed the Appellant's name, DFO number and weeks of employment. She said that these pages were used for cross-referencing purposes.
[548] She said that she did not have the actual DFO slips of the Appellants. She had photocopies and have reviewed those.
[549] She did not have the payroll books of the Payor for 1992 year and did not review them (pp. 125 to 127 of the transcript of March 12, 1999) since they were not provided to her.
[550] She had what was contained in the individual files, which was a single page of the ledger sheet, each in the name of the Appellants.
[551] She reviewed the Payor's tax returns to see whether there was a breakdown of sales between the general store and the Fish Mart.
[552] She said that in 1992 there was a breakdown and in 1993 all the sources of income of the business were under one financial statement.
[553] In cross-examination, she said that her understanding of the QMP requirements was the information she received from the Rulings Officer.
[554] She said she read the booklet which was later filed in the Court record on April 8, 1999 (Exhibit R-67).
[555] Her understanding of the legal requirements of the QMP program was that fish plants should keep records in case of a recall of product; the product sold, if learned to be contaminated, could be traced back to the area it was fished.
[556] She said that the Payor was unable to provide her with any information on what local sales would be. Dale Sharbell would have told her that he could have daily sales from zero to $2,000,00.
[557] She admitted that Dale Sharbell had told her that the amounts shown in his books and on the income tax returns accurately reflect the Payor's purchases and would be found to agree with the purchases recorded on the DFO slips.
[558] She said that the income tax returns did not agree with the DFO slips because she did not have in her possession all the DFO slips for the other species of fish, which were not covered by the QMP records, but would have been included in the income tax return.
[559] She said that the only DFO slips that were in possession of the Appeals Officers were only those included in the individual files of the Appellants. She had no original DFO slips or any other information other than what was contained in the individual files which were photocopies made by HRDC.
[560] She made her calculations from computerized records and admitted that she did not have the components from which the printout was derived.
[561] She said that her inquiry led her to understand that the original DFO slips were picked up from the buyers, that a quick audit of such was done in Charlottetown and then they were sent to Moncton.
[562] These printouts from Moncton played a role in her decision-making process. They were the foundation from which she began to do her volume analysis. She could not say whether they were properly tabulated (p. 29 of the transcript of April 6, 1999).
[563] She spoke to Lew Stevenson and Gary Robbins. She could not recall discussing with Gary Robbins that he had trouble reconciling his records with Sharbell's income tax returns. She admitted that she got to a point that it did not matter what she looked at, she was having trouble getting anything to match. She agreed that local sales were not recorded in the QMP scribblers.
[564] She was asked if anyone decided to take all the DFO slips for the month of September from the fishermen and add them up. She replied that she did not have the DFO slips from the fishermen and all she would have had were the photocopies of the DFO slips of those who had made appeals.
[565] She was asked whether she received breakdowns from the accountant regarding T4 slips and records of employment that were issued. She replied that she received the payroll books. She had the pay records for shellfish but she did not see pay records for other species.
[566] She took the payroll for an individual and matched the DFO slips that were in this individual's file. This would tell her what the particular person had DFO slips issued for and what unemployment insurance premiums payable would have been deducted.
[567] She admitted that she never saw the Payor's tapes for daily purchases.
[568] Dale Sharbell had told her that the DFO slips were an accurate record of fish purchases. The DFO slips were taken to the accountant's office every week and Nancy Small would make a tape of them. Dale Sharbell had also told her that these records went to the office of HRDC and when they returned they did not have the tapes on them (see diary R-64, tab. 12, p. 4, entry for March 26, 1996).
[569] She did not know whether HRDC made copies of the Payor's tapes for daily purchases.
[570] She was asked if such tapes would have confirmed what Dale Sharbell had said whether these tapes would not have made a difference in her investigation? She replied that the tapes would not have identified the species. It would have just showed what he purchased and he was purchasing more than what was being looked at because he was purchasing other species that were not shellfish. The tapes would not have reflected accurately what shellfish had been purchased. The tapes would have reflected all purchases. She did admit that the tapes could have substantiated what Dale Sharbell was saying (p. 45 of the transcript of April 6, 1999)
[571] It was suggested to her that the only reason Revenue Canada did not investigate other species of fish besides shellfish and eels was that there were no QMP scribblers for those species. She replied that she did not know that.
[572] The witness had said that when she was making her decisions any credible or reliable records that fisherpersons were accepted.
[573] She was asked how a fisherman could prove that he did not fish? She gave an example where one person whose name was in the QMP scribbler proved that he did not fish because he was hospitalized.
[574] She was then asked if that situation did not trigger a warning bell in her head? She replied that the records were not reliable and agreed that it would be unfair if a fisherperson's name was put in the QMP scribbler in that fashion while he had not fished.
[575] She also agreed that a situation similar to the one just described would have financial implications.
[576] She was then asked if a person reached the appeal stage and proved that he could not have fished because he was in the hospital whether she did not find the process flawed that an individual would reach such a point? She agreed.
[577] She said this type of a situation was discussed at one of the meetings with Mr. MacDonald and the other Appeals Officers.
[578] She admitted that she had spoken to Lew Stevenson. She was asked whether Lew Stevenson ever faxed her his report of the investigation. She replied that she recalled reading a report but was not sure whether she read the report from Gary Robbin's records or if it was from what Lew Stevenson had sent.
[579] She recalled reading it but she did not recall what her source of information was or where it came from. She said it was a typed report. She did not remember who the report was submitted to. She thought it was produced in Court at the previous hearing date.
[580] At the suggestion of counsel for the Respondent, she said the report of HRDC was in Exhibit R-64, tab. 3. She did not know when this undated report was made or sent or for whom it was prepared.
[581] Lynn Loftus was further cross-examined. This testimony can be found in the evidence of the following individual Appellants: Donna Lewis, Janet W. Arsenault, Eliza Clements, Allan McInnis, Carl Lewis, John Arsenault, Elmer Lewis, Elizabeth Lewis, Claudette Gallant, Robert M. Arsenault, Darryl MacIntyre, Lowell Hudson and Roger Palmer.
VI- The Analysis
[582] This hearing involved fifty-four Appellants and lasted for more than forty days.
[583] The hearings took place in January, March, April, November and December of 1999 and ended on April 6, 2000. The hearings were postponed from April to November 1999 in order to allow the Appellants to return to their fishing activities.
[584] The hearing involved 54 Appellants, 27 of whom were self-represented, 3 were represented by agents and 24 represented by counsel.
[585] The parties filed many documents which I accepted in evidence as allowed in this type of hearing.
[586] I felt obligated at one stage of the hearing to request from the lawyers representing Appellants to act as amicus curiae (a friend of the Court) to assist the unrepresented Appellants in solving issues which the Court considered important (transcript April 12 to 16, 1999).
[587] The Court also asked one of the Appeals Officers, Rosemarie Ford, to look at receipts filed by one Appellant who gave evidence but never returned to the hearing to terminate his cross-examination (p. 151 of the transcript of April 19, 1999).
[588] The Court also felt it necessary to put many questions to the witnesses in order to clarify issues.
[589] Also of concern was the fact that the hearing began in 1999 and the periods under review were the years 1992 and 1993.
[590] The investigation, as the evidence showed, began in early 1994.
[591] The interviews of the fisherpersons by HRDC and the Respondent began in early 1995.
[592] The Rulings Officer began rulings in late 1995, early 1996.
[593] The Appeals Division began issuing decisions in the summer of 1996 until 1997.
[594] The length of this hearing was a strain on all those involved.
[595] This Court was not conducting a public inquiry as we understand that term, but held a public hearing of close to sixty witnesses and is duly bound to identify and attempt to solve the concerns raised by all parties to these proceedings.
[596] To rely simply on the facts and reasons alleged as outlined by the Minister in the Replies to the Notices of Appeal would not permit to comprehend to any degree how or for what reasons the decisions and/or the decisions of the Minister were arrived at.
[597] It is necessary to look at what took place prior and during the Minister's decisions in order to know the basis for the Minister's decisions which are the subject of all these appeals.
[598] The appeals before this Court, as will be dealt with later, stem from rulings and decisions arrived at by the Minister in 1996 and 1997 as a direct consequence of a common investigation carried out by HRDC and the Rulings Division of Revenue Canada in 1995 and 1996, of records of employment issued by the Payor, the entitlement of the Appellants to unemployment insurance benefits and the insurable earnings of the Appellants
A- Fishing Regulations
[599] In 1992 and 1993, these Regulations were known as the Fishermen's Regulations.
[600] Section 75 of the Regulations specifies that any person who is a fisherman shall be included as an insured person and be subject to the Act and these Regulations.
[601] During the periods under review all the Appellants did not derive their total income from selling fish to buyers, but most of them did.
[602] Each Appellant's case will be dealt with separately in the concluding analysis dealing with each individual Appellant.
[603] However, when a fisherman, as defined in section 74, sells his or her catch, according to the Regulations the buyer becomes the employer of the fisherperson for the purposes of unemployment insurance benefits.
[604] We are dealing with an insurance plan. Every fisherperson may be covered by the plan but is not automatically insured.
[605] Fisherpersons catch their species of fish, deliver it to a buyer.
[606] The fisherperson and the buyer negotiate the sale of the catch.
[607] The buyer agrees to buy and pay the fisherperson the market price of the catch. This market price changes regularly.
[608] Once the deal is made, in order to be eligible for unemployment insurance benefits and for the buyer to become the fisherperson's employer, the Regulations provide for obligations on the fisherpersons and the buyer.
[609] The Regulations also outline the duties of the Minister.
1- The obligations of the fisherperson
[610] In order to be eligible for unemployment insurance benefits, the fisherperson must sell to a buyer in accordance with section 76 of the Regulations.
[611] The fisherperson must deliver his catch to the buyer and in a declaration made in accordance to section 82 of the Regulations declare to share in the returns from the sale of the catch. In other words he must register with the buyer that he is selling fish in order to participate in the insurance plan.
[612] When these conditions of delivering and declaring to share in the return from the sale of the catch are met, the buyer shall be regarded as the employer of the fisherperson.
[613] What shall the fisherperson declare?
[614] At the time of delivery the fisherperson must declare to the buyer the particulars outlined in subsection 82(1). If the fisherperson does not declare the information he cannot be insurable (The Queen and Larry Nuttall, F.C.A. A-731-96).
[615] In these appeals, the Appellants had to declare or state to the Payor that they made the catch, in addition to giving their names, addresses and social insurance numbers in order to be registered for insurance purposes.
[616] Subsection 82(2) provides that making false statements knowingly on a declaration or failing to provide information, if known, is an offence under section 73 of the Act.
[617] No evidence was shown that any of the Appellants knowingly made false statements at the time of delivery and registration for the insurance plan
[618] The declaration to be made is to be understood to mean a verbal declaration, identifying the fisherperson and registering him or her for the insurance plan.
[619] In fact, what Parliament provided was a practical market-place mechanism to allow fisherpersons to promise to sell, deliver, and give the necessary details of himself or herself to the buyer who accepts the delivery and is entrusted with the obligation of record keeping for the express purpose of registering fisherpersons who are participating in the unemployment insurance plan.
[620] The evidence showed that written declarations were made up in 1993 at the suggestion of Stan McCallum of Revenue Canada to the buyers. It was a suggestion made in the Revenue Canada Taxation handbook filed by Dale Sharbell (Exhibit B-18, p. 8) which pointed out that the fisherperson's declarations need not be in writing.
2- The obligations of the buyer
[621] Section 77 of the Regulations provides what particulars the records, referred to in section 58 of the Act, shall contain for the purposes of the Fishermen's Regulations.
[622] Section 58 of the Act must be read together with section 77 of the Fishermen's Regulations.
[623] Subsection 58(1) indicates that the Payor shall keep records and books of account at his place of business or residence in Canada in such form and containing such information, including the social insurance number of each insured person as will enable, any premiums payable under this Act or any premiums or other amounts that should have been deducted or paid, to be determined.
[624] Subsection 58(2) provides that if the Payor fails to keep adequate records and books of account the Minister may require him to keep records and books of account as the Minister may specify.
[625] If the employer or Payor or buyer of fish is so advised, he shall thereafter keep records and books of account as required by the Minister.
[626] No evidence was provided to indicate that the Payor was advised to keep records or books under subsection 58(2) of the Act. It follows therefore that prior to the investigation the Payor's books were prima facie relied upon by the Minister and by the insured fisherpersons for the insurance plan.
[627] Subsection 58(3) of the Act requires that the buyer retain records and books of account and every account and voucher necessary to verify the information contained therein until the expiration of 6 years unless permission for prior disposal is given by the Minister. The evidence showed that the Payor had his pay records and accounts available during the investigation.
[628] Subsection 58(4) of the Act provides that where the employer or employee is subject to the determination of a question under section 61 the records shall be retained until the appeals process is terminated.
[629] Therefore the buyer or the Payor in these appeals was required under subsections 77(1) and 77(2) of the Regulations to keep records that contained all particulars required for determining whether premiums were payable by the Payor, the earnings of fisherperson's and the proper allocation thereof and the time of payment of premiums by the employer and all the particulars required under subsection 82(1).
[630] The additional particulars required under subsection 82(1) were records showing the names, addresses and social insurance numbers of fisherpersons and their sales of catch or catches to the Payor which are to allow the buyer to establish earnings for unemployment insurance purposes.
[631] Subsection 77(2) provides the additional obligation on the Payor to keep and maintain all books, records, accounts and documents in respect of any fisherman separate from other insured persons.
[632] The employer is obligated to keep two sets of records and books of account: one for fishpersons and another for other employees. In fact, the Payor must keep two separate payrolls; one for fisherpersons and one for other employees.
[633] With those books that the employer is obliged to keep he then accomplishes the second obligation of determining the earnings of a fisherperson that shall only be carried out as provided in section 78 of the Regulations.
[634] The earnings of a fisherperson, in accordance with subsection 78(2), shall, subject to subsection 4, be the amount paid or payable to him or her in respect of a catch in accordance with the statement or declaration or share arrangement made at the time of delivery.
[635] In summary, the situation described by the evidence, as existing in the industry was a promise of sale made by fisherpersons to the Payor in many cases before the fishing season or during the season or at the time of delivery.
[636] The acceptance of delivery and actual possession by the Payor of the fish is equivalent to a sale under the law. It is for example defined in section 1710 of the Civil code of the Province of Quebec which reads as follows:
"[1710cc] The promise of sale with delivery and actual possession is equivalent to sale."
[637] When this sale is accompanied by the declaration of subsection 82(1) of the Regulations, the Payor is obligated to record keeping.
[638] The record keeping begins by reducing to writing the details of the completed sale and the registering of the fisherperson for insurance purposes as revealed by the DFO slip receipt given to the fisherperson".
[639] Subsection 78(2) indicates that the amount of money given in exchange for a sale is either paid at the time of delivery or payable at a future date. When the earnings are determined, subsection 78(4) must be applied to allow for the use of a boat or gear in arriving at the amount of weekly insurable earnings.
[640] In fact, the use of a boat or gear was not a requirement in the verbal declaration specified in subsection 82(1) at the time of delivery of the catch.
[641] It therefore follows that the necessary deductions or paperwork could be made at the time of delivery or at a later date when the bookkeeper does the books. This seems to be what Parliament intended. It would appear impractical, cumbersome and almost impossible to require a buyer to do all his calculations and bookwork at each delivery in the traffic of fisherpersons in the fish building, as described by Jason Bulger when working for the Payor in 1992 and 1993.
[642] This brings us to the next obligation of the buyer which is to allocate the fisherperson's earnings according to section 79 of the Regulations.
[643] Subsection 79(1) specifies that the earnings of a fisherperson shall be allocated only to weeks as determined by this section.
[644] Subsection 79(2) provides that the earnings of a fisherperson from a fresh catch shall be allocated to the week in which the delivery of the catch is made.
[645] All the Appellants that sold fish to the Payor delivered fresh catches in the years under review.
[646] The other important obligation of the buyer of fish was to pay the premiums as set out in Part III of the Act.
[647] It is on behalf of the employee that the employer is required to deduct and remit the sums payable as the employee's premiums.
[648] This rule also applies to buyers of fish, under the Regulations, who are considered employers for the purpose of the insurance plan.
[649] The evidence as to how and when the fisherpersons paid their premiums to the buyer, varied in several cases. However, one must conclude that no premiums were owed to the Minister by the employer for any of the Appellants.
[650] Dale Sharbell of the Payor testified as to the procedure followed by him. He filed on January 20, 1999 a Revenue Canada Taxation booklet entitled "Fishermen and Unemployment Insurance" (Exhibit B-18). He did not do the actual bookwork.
[651] The records to be kept by the Payor for the purpose of unemployment insurance were kept in 1992 by Marilyn Enman (Exhibit R-20), the deceased sister of Dale Sharbell and in 1993 by the accounting office of the Payor. Byron Murray was the accountant.
[652] These persons also prepared the ROE's of the Appellants for the years 1992 and 1993.
[653] The pages of the Payor's 1993 payroll books are to be found in Exhibit R-8, tab. 4, pp. 1 to 20 and in Exhibits R-28 to R-63 concerning individual Appellants. No original complete payroll book of the Payor was filed for the 1993 year showing all fisherpersons.
3- The obligations of the Minister of National Revenue
[654] Section 3 and Part III (Collection of premiums) of the UI Act are the responsibility of the Respondent.
[655] It is under that part that we find sections 58 and 59 of the Act which deal with books and records that employers must keep for the purposes of the Act. These sections must be read together with section 77 of the Regulations for the purpose of these appeals.
[656] In the Fishermen's Regulations the Minister is mentioned or referred to in subsection 76(5), paragraph 78(3)(b), subsection 79(4), section 80 and subsection 82(2).
[657] The Respondent and his officers, under this unemployment insurance plan, had the authority under subsection 58(2) and section 59 to require Payors or employers to keep adequate records and books of account if they have failed to do so. Subsection 59(1) also provided for any purpose relating to the administration or enforcement of the Act that the Respondent, inspect, audit or examine any document that relates or may relate to the information that is or should be contained in the records or books of account or to the amount of any premium payable under the Act.
[658] Section 59 provides to the Respondent the authority to enter premises where any records or books of account are or should be kept.
[659] This section requires the owner of the premises to give assistance to the authorized officer and answer questions etc.
[660] The officer may, when authorized by a warrant authorized by a judge, enter premises to carry out the duties in relation to the records and books of account.
[661] Subsection 59(4) stipulates also that the Minister may, subject to subsection 59(5) for any purpose relating to the administration or enforcement of Part III by notice served personally or by registered or certified mail, require that any person provide, within such reasonable time as is stipulated in the notice, any information or additional information including any information return or supplementary return or any document.
[662] Subsection 59(5) however stipulates that the Minister shall not impose on any person, in this section referred to as a "third party", a requirement under subsection 59(4) to provide information or any document relating to one or more unnamed persons unless the Minister first obtains the authorization of a judge under subsection 59(6).
[663] As can be seen Parliament entrusted the Minister and his officers with all the necessary authority to inspect, audit and examine the records and books of account or any document that relates or may relate to the information that is or should be contained in the records or books of the Payor or the amount of premiums payable under the Act. Parliament also provided the necessary authority to oblige any person to provided documents.
[664] The reason for this is that Parliament made the Respondent somewhat like the insurance company, responsible for collecting the premiums and determining what is to be insured and inspecting, auditing, examining and obtaining the records.
[665] When we examine then the Fishermen's Regulations they show in section 80 what the obligations of the Respondent are when those aforementioned books, records, accounts and documents are not adequate for some of the fisherpersons and adequate for others.
[666] What is the purpose of subsection 80(1)?
[667] This subsection provides that if the officer of taxation is of the opinion that the books, records, accounts and documents of a Payor are not, in respect of some of the fisherpersons, adequate for the purpose of enabling the officer to determine with reasonable facility the amount of insurable earnings in respect of any period, the premiums payable and the dates on which they were payable or when the premiums were paid, he shall do two operations or types of work.
[668] Firstly, under paragraph 80(1)(a), in respect of any fisherman for whom the books, records, accounts and documents are in the Officer's opinion adequate, determine the insurable earnings and the premiums payable according to the Fishermen's Regulations.
[669] Secondly, under paragraph 80(1)(b) in respect of any fisherperson for whom the books, records, accounts and documents are, in the Officer's opinion inadequate, estimate the insurable earnings in the manner described in subsection 80(2) and determine the premiums payable to be five percent of the earnings estimated.
[670] When the Officer estimates the insurable earnings under paragraph 80(1)(b) for the purpose of making this determination he may estimate, as outlined in subsection 80(2), the period when the catches were made, the number of fishermen involved in any catch and the earnings of each fisherman for each week in the period during which the catches were made.
[671] Subsection 80(3) stipulates that the aggregate or collective earnings of all the fishermen for the period estimated, shall not exceed the gross returns of all the catches during the period. These would be the fisherpersons for whom the book records, accounts and documents are not adequate. Their earnings for that estimated period shall not exceed the gross returns of all the catches.
[672] Subsection 80(4) stipulates that when the Officer of taxation is computing or estimating insurable earnings and premiums payable, pursuant to subsections 80(1) or 80(2), the total earnings from which the premiums are determined shall exclude therefrom the deduction referred to in paragraph 79(4)(c) (boat share or gear rental) if such a deduction is required by that paragraph, and also exclude any earnings that he is satisfied have been paid or become payable to any fisherman who is not insured or in respect of whom the books are adequate.
[673] Subsection 80(5) also provides what an officer of taxation may do on the first inspection of the books, records, accounts and documents of an employer with respect to establishing earnings.
[674] The evidence showed that this investigation was to the knowledge of the Appeals Officer the first inspection of the Payor's books under this insurance plan for fisherpersons.
[675] Therefore when we analyze and attempt to grasp the real meaning and significance of the Act and all these Regulations referred to above, several questions come to mind which must be answered by the Court.
[676] What books, records, accounts and documents is the legislation referring to?
[677] In section 52, the word "documents" is defined as including money, securities and any of the following, whether computerized or not: books, records, letters, telegrams, vouchers, invoices, accounts and statements (financial or otherwise).
[678] In subsection 58(1) the legislator uses the term "records and books of account in such form and containing such information including the social insurance number of each insured person as will enable any premiums payable, or any premiums, or other amounts that should have been deducted or paid to be determined".
[679] In subsection 58(3) we see the following phrase: "keep records and books of account shall retain those records and books of account and every account and voucher".
[680] In section 59, we see the phrase "inspect, audit or examine any document that relates or may relate to the information that is, or should be contained in the records or books of account".
[681] Above section 77 of the Regulations we see the heading "Records to be kept by employers".
[682] In subsection 77(1) the legislator has imperatively indicated "the records referred to in section 58 of the Act shall contain..."
[683] In subsection 79(4) which deals with the allocation of earnings the legislator uses the phrase "keeps records sufficient to enable an officer..."
[684] In subsection 80 we see the phrase "books, records, accounts and documents of an employer of fishermen are not in respect of some of the fishermen of whom he is the employer, adequate for the purpose".
[685] The reasonable conclusion in interpreting the various sections is that the legislator required, for this insurance plan, records to be kept by the employers that contained; the names of fisherpersons, their social insurance numbers, a recording that they caught fish, the earnings of fishermen and the proper allocation and recording thereof, whether premiums were payable by the employer, and the time of payment of premiums by the employer.
[686] These prescriptions are what section 77 of the Regulations and 58 of the Act require Payors to keep for this insurance plan.
[687] Therefore when the legislator enacted the Act and these Regulations he described what kind of record keeping was required and what records, books, accounts and documents the Officer of taxation should be looking for and looking at when he or she decides to use section 80 of the Regulations.
[688] Section 80: A reading of this section makes one think that the legislator did not contemplate that the Payor's books, records, accounts and documents were going to be inadequate for all the fisherpersons as suggested by the Appeals Officer in these appeals (Transcript of March 12, 1999, pp. 113 line 22 to page 114 line 3) but did provide in subsection 80(5) what a taxation Officer may do on the first inspection of the Payor's records such as in the case of this Payor.
[689] The legislator made a clear distinction between the books being inadequate for some fisherpersons and adequate for others.
[690] At the very beginning of subsection 80(1), he also explains what opinion the officer should make.
[691] The Officer of taxation must be of the opinion that the books, records, accounts and documents of the Payor are not in respect of some of the fishermen of whom the Payor is the employer adequate for the purpose of enabling the officer to determine with reasonable facility the amount of insurable earnings in respect of any period, the premiums payable and the dates on which they were payable or when the premiums were paid by the Payor.
[692] Where the records are adequate he computes the earnings according to the Regulations. Where the books are inadequate he must estimate earnings in the case of these fisherpersons by following the procedure outlined in subsections 80(2) to 80(4).
[693] Notwithstanding subsection 80(1) or subsection 80(2) he may on the first inspection of the Payor's books proceed to estimate the earnings in conformity with subsection 80(5).
[694] In these appeals, as will be demonstrated, the Respondent, through his officers, determined and allocated the Appellants' insurable earnings by relying on part of the Payor's pay records and part of other records of the Payor called "QMP scribblers" (Exhibits R-1 and R-2). Did the Minister estimate the earnings as prescribed by the legislator?
4- Records kept by the Payor
[695] The records kept by the Payor which were the subject of these appeals and which were used in part by the Respondent at the ruling and appeals stages were of two categories.
a) The first category
[696] The first category was the books and records of the Payor kept under section 77 of the Regulations, more commonly called the payroll records.
[697] The payroll records were made up as described in the admission of the evidence of Byron Murray the accountant for the year 1993 and in Exhibit R-20 for the year 1992.
[698] In particular these payroll ledgers or books, in addition to identifying the Appellants, identified the pre-numbered DFO slips which had been issued by the Payor to the Appellants for their deliveries of fish.
[699] The Payor remitted to the bookkeeper every week all the necessary paperwork including the buyer's copies of the DFO slips he had issued to each fishermen, for the purpose of permitting the making up of the Appellants' records of employment (ROE's) at the end of the season.
[700] The DFO slips were prepared as described by Dale Sharbell, Martin Smith and all the Appellants who were questioned on this subject.
[701] In general when a person delivered fish and wished to be registered by the buyer according to the unemployment insurance plan, he or she would go to the fish building of the Payor's establishment.
[702] The fish would be weighed, as was described by Jason Bulger who worked almost exclusively in the fish building with Martin Smith. The fisherperson was remitted a piece of paper with the weight and species of fish indicated. If the name of the person was not known to Dale Sharbell, it was also written on the said slip.
[703] The next step was for the fisherperson to proceed to the office and receive a DFO slip as a receipt for the delivery.
[704] The DFO slip was made up either by Dale Sharbell or Martin Smith. It did happen that Blake Sharbell would make up the odd DFO slip.
[705] In 1992, at times Marilyn Enman, the bookkeeper of the Payor, would make up a DFO slip for fisherpersons.
[706] If a fisherperson was making one delivery in a week the DFO slip was generally made up at that time.
[707] The DFO slip would be made up generally on the last day of the week which coincided with the last of the deliveries for one week for fisherpersons who delivered more than once a week.
[708] The fisherpersons were paid in cash for their deliveries mostly on the day they would receive their DFO slips.
[709] The premiums for unemployment insurance purposes were generally remitted at the time of payment.
[710] The Payor however made the necessary remittances for all insured persons.
[711] Copies of the DFO slips remitted to the fisherpersons would be sent to the bookkeeper once a week with all the other paperwork (see admission re: Byron Murray).
[712] The bookkeeping work of Marilyn Enman or Byron Murray was not disputed by the Respondent.
[713] What was disputed was the manner of issuing the DFO slips, basically the procedure followed by the Payor and the possibility of wrongdoing on the part of the buyers and fisherpersons in general and the Payor and the Appellants in particular.
[714] Suspicions were created by admissions of some fisherpersons of false DFO slips and falsified ROEs.
[715] These suspicions led to the common investigation of HRDC and the Respondent which is discussed at length later and confirmed by the letters of HRDC sent to the Payor and the fisherpersons in October of 1996.
[716] However, at the hearing the procedure followed as to the issuing of the DFO slips, how they were marked "stamp" or "no stamp", how they were accepted or refused as earnings, how the refusal of earnings was accepted practice for unemployment insurance, was spoken to by many witnesses.
[717] The Respondent was concerned with the problem of "banking fish", "selling fish in another person's name", "under the table sales", the opportunity for abuse in general as outlined in the submission.
[718] The Respondent was also concerned that a majority of the Appellants had the exact number of weeks required to qualify for unemployment insurance benefits. This, in the mind of the Respondent and the lawyers advising him while not conclusive of any wrongdoing, raised suspicion in these appeals. What was the suspicion raised? Was it to the advantage or disadvantage of any Appellant who had the necessary ten weeks?
[719] The practice which was described must be analyzed in the context of what was being done in the industry at the time and what appeared to be accepted practice by buyers, fisherpersons and the Respondent's representatives.
[720] What the Respondent is actually pleading is that he was not satisfied with what he was hearing about what fisherpersons and buyers were doing in the industry in P.E.I. in the years under review, as it relates to unemployment insurance.
[721] This hearing certainly permitted the Respondent to gather valuable information first hand about what was happening.
[722] When reading the Respondent's written submissions it confirmed that the Respondent was continuing the investigation at this hearing and outlined the concerns he had especially with Dale Sharbell, the issuing by him of the DFO slips, his use of cash payments, etc.
[723] All the suspicions however led to the use by the Respondent of part of the second category of records which this Court will now discuss.
b) The second category of records
[724] The second category of records was the Quality Management Records ("QMP").
[725] The making or recordings in these scribblers was not made or verified by the Payor's bookkeeper in 1992 or the accountant in 1993.
[726] How these QMP scribblers were kept was described at length by Dale Sharbell of the Payor and Martin Smith an employee of the Payor.
[727] The Minister in both, the Rulings and Appeals Divisions of his department, concluded that the QMP scribblers kept under the Fish Inspection Regulations were reliable records to determine and allocate earnings of fishpersons in general, and the Appellants in particular under the Fishermen's Regulations.
[728] How this came about was the result of a common inquiry of HRDC and the Respondent which will be dealt with but first, what was the Quality Management Program or QMP?
[729] The quality management program scribblers (QMP) (Exhibits R-1 and R-2), were another set of records, kept by the Payor under the Fish Inspection Regulations. This program included procedures, inspections and records by which the operator of an establishment, such as the Payor, verifies and documents that the processing of fish in the fish plant complies with the Fish Inspection Regulations.
[730] These records, according to the evidence, did not contain all the information required by section 58 of the Act or section 77 of the Regulations and were not the type of records contemplated by Parliament for the insurance plan.
B- Quality Management Program (QMP)
[731] The QMP and the records or documents kept by the Payor thereunder was of paramount importance to this hearing because of the almost exclusive reliance placed by the Minister on the record keeping of the Payor under this program in establishing the Appellants' earnings, the value of their earnings, their weeks of employment, the accuracy or inaccuracy of their DFO slips and the resulting records of employment issued to them by the Payor.
[732] What was the QMP and its origin?
[733] On July 24, 1989, paragraph 26(1)(f) was added to the Fish Inspection Regulations and section 14.1 was added to Part I of Schedule II [10].
[734] These amendments stipulated that the owner or operator had to keep a record of each delivery, of bivalve molluscs except scallops, to the establishment.
[735] The 1989 Regulations provided that the record had to include the common name of the molluscs, the quantity by weight, the location from which they were harvested, the date of harvest, the name and address of the person who harvested the molluscs, the date they were received by the establishment, the manner in which and the date they were processed and the name and address of the person to whom they were shipped and the date.
[736] On January 23, 1992,[11] the definition of "processing" in section 2 of the Fish Inspection Regulations was revoked and the definition of "quality management program" was added to the Fish Inspection Regulations as follows:
"quality management program" means a program, including procedures, inspections and records, by which the operator of an establishment verifies and documents that the processing of fish in that establishment complies with these Regulations; (programme de gestion de la qualité)."
[737] On December 17, 1997 the definition of "quality management program" was replaced by the following:
"quality management program" means a fish inspection and control system, that includes procedures, inspections and records, for the purpose of verifying and documenting the processing of fish and the safety and quality of fish processed in, exported from or imported into Canada; (programme de gestions de la qualité)." (SOR/98-2)
[738] Subsection 15(1) stipulated under what conditions the Minister of Fisheries and Oceans may issue a registration certificate.
[739] Subsection 15(2) stipulated that any operator of an establishment, in respect of which a registration certificate has been issued and in which fish is processed for export, was obligated to implement and comply with the establishment's quality management program. He, among other requirements, was also obligated to keep and make available for inspection detailed records of the inspections and evaluations conducted or actions taken within the establishment pursuant to its quality management program. The operator had to comply with certain requirements and in particular those set out in Schedule VI (this Schedule was repealed by SOR/99-169 on April 15, 1999 at the time this hearing was in progress).
[740] This last schedule outlines the requirements respecting "quality management program" and in particular what information and documentation was required to be kept by the operator of an establishment.
[741] One of the requirements was to be able to identify the name and title of the person responsible for the quality management program at the establishment. In 1992, it was Dale Sharbell and in 1993 Martin Smith was responsible for the keeping of the QMP scribblers under the direction of Dale Sharbell.
[742] Another requirement in respect of fish shipped from the establishment was a description of the system used to trace fish to their first destination.
[743] The schedule also outlines that the operator of an establishment determines compliance with the Regulations at different stages in the processing of fish.
[744] Section 24.1 of the Regulations stated that every person who exports fish from an establishment shall keep a record of the name and address of the person to whom and the date on which, the fish is shipped from the establishment.
[745] Paragraphs 17(a) to (f) of the Regulations outline the reasons why the Minister may cancel the registration certificate issued to an operator of an establishment.
[746] No evidence showed that the Payor's registration certificate had been cancelled in relation to QMP.
[747] On January 23, 1992, when the Fish Inspection Regulations amendment was published we find the regulatory impact analysis statement[12] which of course is not part of the Regulations but gives some insight in understanding the reasons and necessity of the amended Regulations and best summarizes what is to take place in the industry after February 1, 1992. This impact analysis statement reads in part as follows:
"REGULATORY IMPACT
ANALYSIS STATEMENT
(This statement is not part of the Regulations.)
Description
The following amendments establish a Quality Management Program that will help ensure that the products of fish processing plants are safe and wholesome and produced in a manner that complies with the requirements of the Fish Inspection Regulations. Under the regulations, a plant must have a registration certificate if it is producing fish for export to another province or country. To get such a certificate, the amendments require that a Quality Management Program be established by the processing establishment. The program will specify the systematic procedures in place within the establishment that will ensure that the particular processes, practices and methods are adequate to ensure that the products meet minimum regulatory requirements for the production of a safe, wholesome food product.
The amendments will have the industry accept more responsibility for its products. This will allow the Department to direct its inspection resources to problem areas as opposed to using them to conduct compulsory inspections on plants with good histories of compliance. At the same time, the development of quality management programs should lead to more prompt identification and resolution of real and potential problems before their effects are felt in the marketplace. The program will help ensure that products produced in registered establishments meet at least the minimum regulatory requirements. This will help increase consumer confidence in Canadian fish products, both within Canada and in export markets.
Various problems that have arisen with consumer products (i.e., shellfish toxins, Listeria) have resulted in increased demands for assurances of product safety and quality being made by consumers and other buyers of Canadian fish products as well as by some industry members themselves. Increased demands for inspection certificates and increased monitoring resulting from various concerns or problems have divided and overburdened the Department's inspection efforts. This has made it difficult to increase assurance of product safety and quality. These amendments will address these issues.
...
As of February 1, 1992 establishments are expected to operate in accordance with an approved Quality Management Program in order to export their products outside of the province in which they are produced. Establishments which do not meet this requirement may continue to operate but will be able to sell their products only within the province. Federal registration certificates issued for fish plants will have an expiry date. Fish plants that have demonstrated a high level of compliance with regulatory requirements will receive registration certificates valid for two to three years; and those that have had a low level of compliance will receive registration certificates with a shorter period of validity.
...
Consultation
...
The Department of Fisheries and Oceans has contacted all federally registered fish processing plants and their associations across Canada via a written notice introducing the Quality Management Program initiative. The notice was followed up by over 200 industry sector meetings and then individual meetings with each fish plant in which an inspector explained the program in detail. Virtually all of the federally registered fish processing establishments had received a detailed explanation of the program as of January 1991. This industry consultation has resulted in more than 900 registered establishments presenting their written programs to the Department for review and this number continues to climb as more establishments complete their written programs.
... (underlining by the undersigned)
[748] The QMP was a new processing procedure for establishments who were exporting fish product out of province.
[749] As the evidence showed, establishments were having difficulties implementing the program especially in the first years, that is 1992 and 1993.
[750] Basically, however, the establishment to whom a registration certificate was issued and in which fish was processed for export was obligated to keep detailed records of the inspections and evaluations conducted pursuant to QMP.
[751] The requirements respecting this program are numerous.
[752] Establishments had to include all the information outlined in schedule VI, one of which was a description of the system used to trace fish to their first destination, in respect of fish shipped from the establishment.
[753] The registration certificate may be cancelled for the reasons outlined in paragraph 17 of the Fish Inspection Regulations.
[754] Therefore QMP was for exporting fish and if an establishment did not meet the requirements it could still operate but would only be able to sell products locally.
[755] This Regulation and its requirements was not pleaded as such by the parties although it was the main topic in the whole decision making process by HRDC, by rulings, by appeals and by the lawyers of the Respondent who evidently made no reference to this particular legislation.
[756] The Court did not feel that a satisfactory study was made by HRDC or the Respondent of the QMP before embarking on a ruling and appeal process, especially when the authors of the documents (Exhibits R-1 and R-2) had said that they were falsified or not properly made up in some way or other.
[757] As a result of all these Regulations, what QMP records did the Payor keep and how did he keep them?
1. The QMP records of the Payor
[758] The only QMP records filed in the Court record were Exhibits R-1 and R-2.
[759] The Regulations however indicate that in 1989 the Payor had to keep detailed records of bivalve molluscs.
[760] In 1992, the Regulations through the QMP program required many more procedures, inspections and records for not only bivalve molluscs but all species of fish destined for export.
[761] No evidence was shown to indicate what type of records and in what condition they were kept by the Payor for bivalve molluscs from 1989 until the QMP took effect in 1992.
[762] As of 1992 no evidence showed what records were kept for all species of fish entering the Payor's establishment for export. The QMP scribblers (Exhibits R-1 and R-2) deal only with eels, bar clams, quahaugs, oysters and soft shell clams. However, the Payor also bought and exported flounder, herring, mackerel, smelts and lobsters (Exhibit R-22). Dale Sharbell said that he kept scribblers for each type of fish.
[763] The Respondent filed, at the request of the Court, the plant management Handbook for the QMP (QMP handbook) (Exhibit R-67).
[764] This document was printed in 1988, which would indicate that preparations were in the making to implement the QMP before it became Law on February 1, 1992.
[765] This document was part of the Minister's study of the Payor's records. It was not revealed to what extent it was taken into account. The Appeals Officer relied on what the Rulings Officer told her as to the requirement of QMP.
[766] It did appear strange to the Court when reading the Fish Inspection Regulations, the amended Regulations and the QMP handbook that the only records kept by the Payor would be the two books represented by Exhibits R-1 and R-2 (QMP scribblers).
[767] Of course, the Court, it could be said, is not conducting a hearing into the fish inspection aspect of the Payor's establishment. The Court agrees, but the principal allegation of the Minister was the existence of the QMP scribblers and the accuracy of the recordings therein of purchases made by the Payor from the fisherpersons. Therefore one would expect the Court to deal at some length with this subject.
[768] At the hearing, the two inspectors of DFO who had attended the Payor's premises stated that their duties did not involve the conduct of audits.
[769] Justina Doucette stated her inspections were not to determine how much fish was brought into the plant or whether the numbers added up.
[770] She said her main duty was to see that the Payor was maintaining records which could allow, in case of contamination, to get back to the source of the contamination. She also carried out different kinds of inspection, including sanitation.
[771] Curiously when she was interviewed by HRDC on July 5, 1996, (Exhibit A-1, tab. 36) and presumably shown the QMP scribblers of the Payor for 1993, she said:
"I know Sharbells Fish Mart kept all the required records because I don't remember having any problems and I must have checked these records but I just don't remember what records I checked and if it was these exercise books I reviewed. "
[772] It would be difficult to remember three years later what records were checked but was she keeping track of individual deliveries for export only? No evidence in the QMP scribblers (Exhibits R-1 and R-2) would show that someone from DFO would have verified them by a stamp or other markings.
[773] Adrian Doucette was interviewed by HRDC on August 1, 1995, (Exhibit A-6, pp. 13 to 23). On September 20, 1995 he was also interviewed by the Rulings Officer who was in possession of the statement he had given to HRDC on August 1, 1995.
[774] He said that the QMP program required plants to keep records for all species that were brought into the plant.
[775] There was no requirement to record the actual name of the fisherperson.
[776] He matched the amounts recorded in the QMP scribblers to the amounts in the shipping records.
[777] He was not sure who actually did the recordings or if it was done by one person.
[778] His inspection duties did not require him to note the inconsistencies even if he did happen to see something.
[779] He stated that if a plant recorded only a portion of its purchases and sales in the QMP records his inspection process would not "pick that fact up".
[780] He showed the Rulings Officer Sharbell's QMP plan dated July 30, 1990, that was submitted for approval to DFO.
[781] The plan detailed what procedures the Payor would follow and what records the Payor would keep for QMP purposes.
[782] This plan dated July 30, 1990 was not released because it was an original DFO document.
[783] He stated that the Payor was required to sign an agreement with DFO, identifying how records were to be kept in order to meet the requirements of the QMP program.
[784] No evidence showed what the terms of this agreement were as to the record keeping obligations of the Payor. In other words, were there other requirements? What records were to be kept for the other species of fish which do not appear in Exhibits R-1 and R-2? The Court does not know.
[785] No evidence showed if a new requirement or plan was submitted after the coming into force of the QMP program on February 1, 1992.
[786] No evidence showed that the Appeals Officer would have seen this QMP plan of July 30, 1990 or any other plan for that matter.
[787] The evidence did show the existence of another document entitled the Canadian Shellfish Sanitation Program Manual of Operations (Exhibit A-1, tab. 10). This document is for the use of field inspectors of DFO. No reference was made to this manual by anyone of the two DFO inspectors heard and never referred to by the officers of the Minister as to record keeping for QMP purposes. The definition of "Canadian Shellfish Sanitation Program Manual" was added to the Fish Inspection Regulations on April 15, 1999 (SOR/99-69).
[788] Basically the record keeping under the QMP program, according to the evidence, was left to a greater extent to the operator of the processing establishment and his staff as a result of the 1992 legislative amendments to the Fish Inspection Regulations.
[789] DFO was responsible for inspections, evaluations and verification of the accuracy of records. In fact, the Payor was to keep records of the inspections and the evaluations conducted or actions taken pursuant to the QMP. He was also required, in respect of fish shipped from his establishment, to have a description of a system used to trace fish to their first destination. This was presumably the QMP scribblers.
[790] No particular report was submitted to show what were the detailed records of the DFO inspections and evaluations conducted at the Payor's premises in order to ascertain of some independent and verifiable monitoring of the entries made in the Payor's QMP scribblers.
[791] The Payor from what was heard had, before 1992, his own method of record keeping which was in the form of "scribblers", hence the use of the term "QMP scribblers". This method was used prior to the coming into force of the QMP program. You could best describe it as home made. After 1992, it is not clear what was really required.
2. The QMP record keeping by the Payor
[792] How Dale Sharbell of the Payor kept his records for QMP purposes was described by Dale Sharbell and one of his employees, Martin Smith.
[793] On March 15, 1995, HRDC and the Rulings Officer are told by Martin Smith, the person required under the QMP to keep these records for 1993, how they were kept (Exhibits A-4 and R-28-10).
[794] Dale Sharbell explained to the Rulings Officer on September 21, 1995, that HRDC was mistaken when concluding that the QMP records were his total purchases. He also told Gary Robbins that QMP was just for contaminated product.
[795] On October 3, 1995, Dale Sharbell advises the Rulings Officer that the information in the scribblers is not correct. The QMP was unnecessary paperwork being forced on him for no reason and he explained how he kept the records.
[796] Dale Sharbell, also through the help of his lawyer as will be discussed later, as a result of threats being made to him by Lew Stevenson on December 8 and 18, 1995, officially advised on January 3, 1996, HRDC and the Rulings Officer that the QMP scribblers were falsified.
[797] The Court did not hear whether this admission on January 3, 1996 by Dale Sharbell led to the loss of his registration certificate but, according to the QMP, falsification of records was one of the reasons why the Minister could cancel a registration certificate.
[798] Therefore, one must assume that this decision, made by Dale Sharbell in consultation with his attorney Mr. McCabe, was a serious admission for him to continue doing business.
[799] Dale Sharbell then again, through his attorney Mr. McCabe on March 6, 1996, advises Lynn Loftus of the Appeals Division that the QMP scribblers were made up to satisfy DFO officials and had no meaning as to purchases.
[800] On March 26, 1996, Dale Sharbell in his statement to Lynn Loftus reiterates how he made up the QMP scribbler from the shipping records.
[801] On May 21, 1996, another interview is held by the Appeals Officer, Lynn Loftus, where more information is provided. Bernard McCabe pointed out as an example that the name of Jim Getson was in the QMP scribbler but should not have been since he was a buyer. Mr. McCabe pointed out the inaccuracies of the QMP scribblers (Exhibit R-64, tab. 12, p. 10).
[802] At the hearing some three years later Dale Sharbell explained how he went about making up the QMP scribblers.
[803] His evidence was corroborated by Martin Smith.
[804] When listening to Dale Sharbell and reading the Regulations, it would appear that this record keeping process of establishments was a massive project of paperwork and with the limited number of employees and the busy delivering of fish, it was plausible that the recordings in the scribblers were not done up on a daily basis.
[805] In fact, Jason Bulger who was most of the time in the fish building knew very little about the QMP. He was not present according to the evidence when the entries were made and he worked from 8:00 a.m. to 8:00 p.m., 7 days a week.
[806] One may then infer that the entries made by Martin Smith were not made up in the fish building when he was weighing fish with his helper Jason Bulger. It must have been made elsewhere or at another time.
[807] Dale Sharbell was a very busy man who kept track of his fish on two note pads he had in his shirt pocket, one for QMP, one for DFO slips.
[808] He knew most of the fisherpersons and he trusted them.
[809] When fish was weighed each fisherperson was given a slip of paper which recorded the quantity of fish and the species.
[810] If the fisherperson was unknown to Dale Sharbell, according to the evidence of Jason Bulger, the name of the person was to be added to the weight slip.
[811] From the fish building the fishpersons went to the office to receive a DFO slip for the delivery.
[812] If more than one delivery was made during the week, the fisherperson returned with his or her slips in order to obtain his or her DFO slips or receipts for the sales.
[813] The QMP scribblers were made up after the DFO slips had gone to the accountant and Martin Smith under the direction of Dale Sharbell made up the entries in the QMP scribblers later at varying intervals, days and weeks later.
[814] When listening to the evidence of Jason Bulger, he could unload a truck and ship the fish the same day. When was that shipment recorded? We do not know but the chances are it was not on that same day and maybe not recorded at all.
[815] The Court heard that fish purchased from other buyers to fill an order was not recorded in the QMP scribblers.
[816] It was also revealed that local sales of product were not recorded (Exhibit R-63, tab. 12, p. 69) in the QMP scribblers or in the annual sales report (Exhibit R-22).
[817] Without the necessity of reciting at length all the testimony of these three witnesses, it appeared convincing and I have accepted that evidence that the QMP scribblers were not made up on a daily basis, and did not record all the species of fish delivered by the fisherpersons according to the DFO slips.
[818] The evidence of Dale Sharbell and Martin Smith as to the making of the QMP recordings cannot be disregarded.
[819] The evidence of Dale Sharbell was consistent to what he had said on numerous occasions, under various circumstances.
[820] It appeared obvious, that this man, not in good health, who testified for close to three days and subjected to lengthy cross-examination, did not attempt to mislead the Court. The Court believed his explanation.
[821] In examining his evidence which was corroborated by Martin Smith, one must be mindful of the size of the Payor's operation, the number of employees working at the plant and the traffic, if I may use that term, of fisherpersons going and coming as described by Jason Bulger.
[822] The fact that Dale Sharbell knew if not all but most of the fisherpersons he was dealing with and the paper work involved in all the inspection documents required by QMP, it would not be a surprise to proceed as he did.
[823] Dale Sharbell could be best described as a self-made business man dealing in the fish industry.
[824] The environment in which he worked must not be ignored.
[825] He was dealing with working people in an area where fishing is the main source of income and registering the fishpersons selling to him for unemployment insurance purposes was a duty he carried out for several years before this enquiry began.
[826] He explained in his own way how he operated.
[827] How he went about keeping track of what he bought and sold, was a preoccupation for him.
[828] He kept two notes pads on him, one he used for the QMP and the second note pad was for recordings of what fisherpersons sold to him and what he owed to them.
[829] When examining the Fish Inspection Regulations and the evidence of Dale Sharbell it showed that he would record in the QMP what was exported out of province, which was what was required.
[830] The Regulations do not specifically mention local sales within the province or in the community and they were not recorded from what it appears.
[831] It would then follow that a buyer such as Dale Sharbell would not record what the Regulations did not require.
[832] Of course the Court was not made aware of the agreement between the Payor and the DFO department as to what actually was required as record keeping for QMP purposes.
[833] So when Lew Stevenson met with Adrian Doucette, one of the DFO inspectors of the Payor's plant, on August 1, 1995, he advised him that his investigation was showing "that based on records of employment issued to individual fisherpersons, Sharbell's Fish Mart would have to be receiving and shipping bar clams, clams, quahaug, oysters and eels in amounts greatly in excess of daily delivery amounts as indicated on their records kept for quality management program requirements". This was what Dale Sharbell said he was doing, i.e. recording in the QMP what was exported.
[834] Obviously then if local sales of oysters or clams or lobsters or others species were not required to be recorded in the QMP recordings, they would be ignored. The QMP records would clearly be incomplete and Dale Sharbell would only be recording what was requested from him for QMP purposes which was exported fish. This is what the Appeals Officer was looking for on May 6, 1996 when she was questioning whether the QMP was for export only (Exhibit R-64, tab. 12, p. 8).
[835] Further the DFO inspector Adrian Doucette, when interviewed by the Rulings Officer, on September 20, 1995, said that he would not pick up any inconsistencies. He assumed that the total amount of product was recorded in the QMP scribblers (Exhibit R-64, tab. 4, p. 3).
[836] Now clearly if the Payor was not recording purchases that he was not required under the QMP and not recording purchases for local sales would it then not be very difficult to compare the DFO purchase slips issued by the Payor to the recordings in the QMP scribblers and rely on the scribblers for accounting purposes to establish insurable earnings?
[837] The cumulative effect of all that was said and done in relation to the keeping and the recording of entries in the QMP scribblers, lead to one single inevitable conclusion that the QMP records or scribblers were not pay records, did not contain what was required under subsection 58(1) of the Act or section 77 of the Regulations and too incomplete for the Court to accept that such documents were used as a tool to determine a worker's earnings.
[838] These scribblers however were relied upon by the Minister's Officers as reliable records of account to determine the earnings of the Appellants.
[839] The reliability of these scribblers was decided at first by Gary Robbins, the Rulings Officer and later by Lynn Loftus, the Appeals Officer.
[840] The Minister through his Officers, however, concluded that only certain portions of information recorded in the QMP scribblers of the Payor for 1992 and 1993 were accurate and sufficiently reliable to apply and determine the value of the earnings of the Appellants.
[841] In concluding on the one hand, that the QMP scribblers were reliable for certain periods in the 1992 and 1993 years, the Minister as a result concluded that the DFO slips received by the Appellants from the Payor during the same periods were not accurate and established the fisherpersons' earnings according to the QMP scribblers and not what was indicated on the Appellants' DFO slips.
[842] The Minister also concluded that certain Appellants, whose names were contained in the QMP scribblers, should be awarded insurable earnings even though they had no DFO slips for any sales and had no ROE's or claimed not to have fished or sold to the Payor.
[843] In one instance the Court did see what request was made by HRDC to the Rulings Officer when no ROE existed (Exhibit B-3, tab. 2).
[844] According to the Regulations if there is no DFO, no ROE, and no declaration the person is not insured.
[845] The Minister also concluded that some Appellants did not fish even though they were in possession of DFO slips and ROE's.
[846] In concluding on the other hand that the QMP scribblers could not be relied upon for certain other periods in the 1992 and 1993 years, the Minister accepted the DFO slips received by the Appellants as representing the sales they had made although suspicion and doubt had been cast upon them.
[847] What led to the decision to rely on the "QMP scribblers" as a record to establish the earnings of the Appellants was a questionable common investigation of HRDC and the Respondent which must be dealt with.
C- The common investigation of HRDC and the Rulings Officer
[848] HRDC began its inquiry on or about the 19th of January 1994. The Payor was thus required under section 94(13) of the Act to provide invoices, weight slips, payroll records, cancelled cheques, bank statements, cash journal, delivery slips, journals on or before January 26, 1994 at 4:30 p.m. (Exhibit R-69). Failure to comply is a criminal offence under section 20 and subsection 105(1) of the Act.
[849] No exhaustive list of what documents were turned over to HRDC was provided to the Court. No one from HRDC testified as to what type of study was made of this documentation except as to what may have been revealed by certain documents or reports filed by some of the witnesses and the Rulings Officer in particular.
[850] The HRDC investigation report filed (Exhibit R-64, tab. 3) bears no date and according to the evidence would have been prepared in late 1995 or in 1996. It would appear that this report must have been prepared after July 5, 1996, because Lew Stevenson of HRDC interviewed Justina Doucette on that day (Exhibit A-1, tab. 36) and one would think that a report of an investigation of this magnitude would not be prepared until all the important prospective witnesses were interviewed.
[851] The Rulings Officer seemed to concede that the report of HRDC (Exhibit R-64, tab. 3) would have been prepared in late 1995 but that it could have been prepared after July 8, 1996.This was the day the Rulings Officer prepared his report for HRDC as to the results of his rulings (Exhibit R-64, tab. 5). He said that there was no report from HRDC and he was not informed one way or the other when the HRDC investigation was finished (p. 119 of the transcript of April 8, 1999).
[852] On August 27, 1996, Lew Stevenson advised Lynn Loftus that he was sending her his report. Did she receive it? What was it about? We may never know.
[853] What is known is that an undated report was filed in the Court record (Exhibit R-64, tab. 3) which must be viewed with some caution as to when it was made up when looking at the evidence as a whole.
[854] On February 28, 1995, the QMP scribblers (Exhibits R-1 and R-2) were provided to the Minister. Most of the documents bear the stamp of Revenue Canada Taxation. These QMP scribblers were filed in the Court record on January 18, 1999.
[855] This Court was not informed as to what took place at this time or for what purpose or reasons the QMP scribblers of the Payor were turned over to the Respondent. These scribblers had been in the possession of HRDC for close to one year. It is not known if other QMP scribblers for other species of fish were kept by the Payor. Dale Sharbell said he kept scribblers for all types of fish.
[856] On or about February 20, 1995, HRDC in conjunction with the Respondent decided to conduct a joint investigation. The evidence did not reveal clearly how this came about or what preceded this decision.
[857] From the evidence however, two documents which were attached together and filed by Clarence A. Bulger (Exhibit R-55-1) would have been sent to the fisherpersons in general and to the Appellants in particular. These documents shed some information as to the part played by HRDC and the Respondent.
[858] The first document was prepared by HRDC. It is a direction to the Appellants to report for an interview. The interview is destined to obtain information required by HRDC to determine the Appellants' entitlement to unemployment insurance benefits pursuant to subsection 46(1) of the Act.
[859] The second document which was unsigned emanated from the office of the Respondent at 94 Euston Street, Charlottetown, P.E.I. Fax: 902-368-0248.
[860] In this document, Clarence A. Bulger is advised that HRDC had requested Revenue Canada to assist it in the investigation of records of employment issued by Sharbell's Fish Mart.
[861] He was also informed that Revenue Canada officers would be available to meet with him at the interview.
[862] He was also informed to bring specific information to the interview.
[863] The information requested from him was for the 1993 and 1994 years.
[864] He was requested to bring: 1) a copy of personal tax returns for each year including financial statements; 2) detailed statement of income, re: fish sales, from each fish buyer, recorded on a daily basis for each year; 3) the dates and the amounts that he was paid for the product for each year; 4) copies of species licenses for each year; 5) payroll records and records of employment issued for any workers they engaged in each of the years and; 6) any other information or documentation they may have to support their insurable earnings from Sharbell's Fish Mart, i.e. invoices, receipts, etc.
[865] One must assume that all the Appellants received a similar notice and no evidence indicated a contrary view.
[866] These documents (Exhibit R-55-1) were never referred to by the Minister throughout the hearing. However the indication to the Appellants is that they are asked to provide information as to their claims for benefits which were made either after their 1992 or 1993 fishing season, to meet with Revenue Canada officers and to bring the necessary documentation to support their insurable earnings from the Payor for those years and also information about other workers they may have employed.
[867] In the case of Clarence A. Bulger we must note that HRDC and the Respondent were requesting information and documentation as to his claim and earnings for the 1993 and 1994 years. The Court did not see the notices to report for other Appellants as to what years they referred to.
[868] All the Appellants attended interviews which began during the months of February or March of 1995. Gary Robbins and Roweena MacKinnon from Revenue Canada attended these interviews for about one month in 1995. Fisherpersons were still being interviewed on February 6, 1996 as may be seen in the statements of Dale Siddall (Exhibit R-54, p. 51) and Paul Waite (Exhibit R-15) after the Rulings Officer had issued his first rulings.
[869] The purpose of the interviews as stated by Gary Robbins was for him to attend the HRDC interviews with the expectation that the files would eventually be sent to his office as ruling requests from HRDC (p. 41 of the transcript of March 10, 1999). He took his own notes and photocopied documentation provided by fisherpersons. He knew that HRDC were interviewing fisherpersons who had sold to the Payor.
[870] From the documents sent to the Appellants it appears clear that the real purpose of the interviews was threefold.
[871] First, HRDC was ordering the Appellants to report under what was first perceived to be subsection 41(6) of the Act to establish their claims for benefits for 1992, 1993 or 1994 some two to three years after they had been filed.
[872] This subsection provides that for the purposes of sections 39 and 40 the Commission may require a claimant or group or class of claimants to attend at a suitable time and place in order to make a claim for benefit in person or to provide information required under subsection 41(5).
[873] This last subsection provides that for the purposes of sections 39 and 40 the HRDC may at any time in respect of any claim for benefit, require a claimant to supply additional information.
[874] Sections 39 and 40 of the Act deal with the establishment by a claimant of the initial claim for benefit and the proof required to be entitled to any benefit. These sections also provide that HRDC shall decide whether or not a claimant is qualified, or whether or not a benefit is payable and notify the claimant of its decision.
[875] In other words this order to report looked as if HRDC was requesting the fisherpersons in general and the Appellants in particular to furnish information to establish theirs claims to benefits.
[876] But when analyzing the two documents together (Exhibit R-55-1) where the Appellants are told that the Respondent has been added to the investigation team with HRDC and the request for information has expanded, it appears clear that this combined action is not necessarily in pursuit of the establishment of the fisherpersons claims to benefits but rather a full-fledge investigation into the records of employment issued by Sharbell Fish Mart.
[877] HRDC and the Respondent are now acting in concert to investigate the fishpersons as a direct result of the order of HRDC sent to the Payor in 1994 (Exhibit R-69) to furnish documents and the order sent by HRDC to fisherpersons to report (Exhibit R-55-1).
[878] The second purpose of the interview was to supply HRDC and the Minister with the information and documentation which is outlined above, in the investigation of records of employment issued by Sharbell Fish but also payroll records and ROE's of other workers they may have employed.
[879] Thirdly the Appellants were requested to supply documentation they might have, to support their insurable earnings from Sharbell's Fish Mart.
[880] The interviews, held as a result of the joint inquiry, without the necessity of citing each one individually, dealt generally with the confrontation of the Appellants with the entries in the QMP scribblers that Appellants knew nothing about.
[881] The joint inquiry was in effect to find out whether Dale Sharbell and fisherpersons had falsified records of employment. In fact, HRDC and the Respondent were gathering evidence to determine whether Dale Sharbell and/or others including the Appellants had committed offences contrary to the Act. In addition, the Respondent was requiring receipts and invoices from the fisherpersons to support their insurable earnings with the Payor for the 1992, 1993 and/or 1994 years.
[882] What was the result of the interviews? What information was gathered by HRDC and the Respondent? What documentation was provided by the Appellants at the interviews? What was remitted by the Appellants to the Respondent to support their insurable earnings, as was requested, by the Respondent? What records did they provide as to other workers or payroll records?
[883] The evidence did not show what exact documentation was gathered by HRDC or the Respondent at these interviews. No witnesses from HRDC were heard. We do not know what was furnished to HRDC or to Gary Robbins and Roweena MacKinnon from the Appellants to support their insurable earnings or the other requests made of them.
[884] The evidence of Gary Robbins did not indicate what documents were given to him or photocopied by him during the interviews he attended, by Appellants to support their insurable earnings. Roweena MacKinnon did not testify. The evidence showed however that she did not attend many interviews.
[885] None of the statements of the Appellants indicate that Gary Robbins or Roweena MacKinnon were present at the interviews. No lists of documents are filed with these statements. We do not know the names of the fisherpersons interviewed in the presence of Rulings Officers or how many of them were Appellants.
[886] What was the result of these interviews as a result of the order to report?
[887] For the Appellants, they are advised on October 10, 1996 by HRDC that they submitted a record of employment from Sharbell's Fish Mart that they knew was falsified and had given false statements in establishing their claims (Exhibit R-3-7).
[888] On October 3, 1996, (Exhibit R-19), HRDC advises Dale Sharbell of the Payor that as a result of their investigation they are of the opinion that he knowingly made false or misleading statements by completing ROE's showing earnings or insured weeks which did not represent a true and accurate account of the employees' work and/or earnings. Some of the Appellants' names are listed in the letter .
[889] No evidence throughout the hearing established that any of the Appellants had falsified or participated in falsifying their records of employment at any time.
[890] However according to Gary Robbins, he would have witnessed admissions by some fisherpersons, none of them Appellants, of the existence of false ROE's.
[891] This situation of admissions by others, not the Appellants, was the basis of suspicion, for the duration of the common investigation, of every person who sold any shellfish to the Payor in 1992 or 1993 or previous years.
[892] It was also the basis of suspicion of every fisherperson whose name was recorded in the Payor's QMP scribblers (Exhibits R-1 and R-2).
[893] The evidence of things that took place during some of these interviews would indicate that the main concern of HRDC and the Respondent was not the Appellants but Dale Sharbell and anyone who was to admit to having participated in falsifying records of employment.
[894] If a fisherman made an admission according to Gary Robbins, "they were not before this Court".
[895] Under what circumstances the admissions were made or what prompted fisherpersons to make admissions, is not known.
[896] However, what the evidence did show, was that if they did not admit to some wrongdoing they were not entirely believed either.
[897] Why? Because of the existence of the QMP scribblers.
[898] The evidence in one instance that of Charles Wagner (Exhibit R-53), showed that at the interview, he was told that the documents he brought with him were not worth the paper they were written on. This Appellant did not sign his statement, left the interview, kept his documents and filed them four years later in the Court record, on March 4, 1999.
[899] Another Appellant, Judy Walfield, (Exhibit R-56) attended her interview and brought all her documentation which was not looked at by the investigators.
[900] What was the real purpose of the joint investigation and subsequent interviews if they were not looking at the documentation the Appellants were bringing? What was HRDC and the Minister looking for?
[901] The only conclusion at this interview stage is that HRDC and Revenue Canada were looking for confirmation of the suspicions they both had that Dale Sharbell and some fisherpersons had participated in some way in falsifying records of employment.
[902] The presence of Gary Robbins and Roweena MacKinnon at the interviews is to listen to what is going to be said since the decision of HRDC and the Respondent was that these fisherpersons would eventually be ruled upon.
[903] Gary Robbins is present during close to, if not more than, 100 interviews. He was directed to withdraw from the interviews.
[904] He did not say exactly who told him to stop attending interviews or what was communicated to him as a reason for withdrawing. He did say that it could be to protect the appearance of impartiality.
[905] But what actually happened was a continuous investigation that suffered a brief interruption from March to September 6, 1995, when Gary Robbins continues his investigation along with the two investigators Lew Stevenson and Joe Pierce as shown by the entries in the diary (Exhibit R-64, tab. 4).
[906] Unfortunately the diary of Gary Robbins in the Court record only begins on September 6, 1995. What actually took place before that, we know from events described in the documentation and what was said at the hearing close to four years later. This diary ends on January 31, 1996.
[907] One could wonder what took place because it was at the request of HRDC that Revenue Canada Officers assisted in the investigation. What was said to HRDC when the Respondent removed his Rulings Officer from the investigation? What decision was taken by the Respondent as to his own investigation of the insurable earnings of the fisherpersons who had been told to bring with them documentation to prove their insurable earnings? (Exhibit R-55-1) Was the documentation remitted to Gary Robbins after the interviews were concluded?
[908] When Gary Robbins ceased to attend the interviews, he nonetheless had access to the QMP scribblers, the documentation which was remitted to him by the fisherpersons, which he photocopied, his personal notes, the admissions by some fisherpersons at the interviews in his presence of false ROE's or other documents.
[909] This was an indication that the Minister must have decided something as to the investigation of insurable earnings of fisherpersons, at that stage. What took place at this juncture was not too clear.
[910] The date of September 6, 1995, marks the day when the Rulings Officer receives six "test files". The diary does not say who assigned the files to him, the Court was not told who these files belong to, but subsequent entries in the diary would show that the 6 test files were sent to him by HRDC before they had completed their inquiry.
[911] What actually took place however was a resumption by Gary Robbins of his part in the common investigation, on September 6, 1995.
[912] What is of particular importance on September 6, 1995, is that the Rulings Officer underlines that out of the six test files he was assigned, three of the fishermen admitted that there ROE's were false, two fishermen said there ROE's were correct and one fisherman said that he was not sure whether his record of employment was correct or not. Were they fisherpersons he had already met at the interviews? It is not known who these fishermen were. None of them were Appellants.
[913] The fact however that some fishermen admitted that their records of employment were falsified had the effect of casting a doubt on every person who sold fish to the Payor and/or in particular whose name was in the QMP scribblers, whether that person sold or not to the Payor. It was not said whether these persons having admitted receiving false ROE's had sold eels, shellfish or other species to the Payor.
[914] The work of HRDC and the Respondent after that, according to the evidence, was to make all efforts to obtain more information about the "QMP scribblers".
[915] The Rulings Officer took the DFO information from the ledger sheets of the Payor's accountant. He obtained the sales information from the sales records of the Payor. He took all the sales invoices for all the species sold by the Payor to arrive at the Payor's total sales.
[916] He then compared the total sales to the sales figure that was on the February 1994 tax return for the 1993 year.
[917] This comparison showed that the Payor declared sales of $93,000.00 more in his 1993 year tax return than the total sales invoice books that had been provided by the Payor (pp. 139 to 144 of the transcript of March 10, 1999).
[918] The Rulings Officer had no explanation or no idea as to what species those sales represented. He said that these sales may have been for one or several of the species that "were not even dealing with in the QMP part of the project". He did not know what information was used by the accountant to make up the income tax return (pp. 134 to 137 of the transcript of March 10, 1999).
[919] On November 29, 1995, when he realized the size of the discrepancy between the Payor's sales and the 1994 income tax return, he knew that he could not base his ruling decisions on the QMP scribblers.
[920] He realized that it would be necessary to know what species these additional sales represented and when they would have been purchased.
[921] He was looking for purchases made by the Payor which would not have been recorded in the QMP scribblers.
[922] Also on November 29, 1995, he decided that if the Payor did not provide further information to him within 15 days to refute the entries in the QMP scribblers, they would be used as the accurate records of the Payor to establish the insurable earnings of the fisherpersons.
[923] In order to obtain further information, he contacted Dale Sharbell on November 30, 1995, by telephone and confirmed his request by letter.
[924] It was decided by the Respondent that if nothing was to be provided by the Payor within 15 days, to refute the QMP scribblers, that rulings on the fisherpersons would proceed using the QMP scribblers as the basis of any adjustments to the records of employment, issued by the Payor, of the fishermen who sold the species of fish reported in the QMP scribblers.
[925] At this stage none of the Appellants is aware of what is about to happen in the coming months and they have no information as to their claims or insurable earnings as a result of their interviews with HRDC and the Respondent.
[926] On December 8, 1995, HRDC duly represented by Lew Stevenson and Joe Pierce, the Respondent represented by Gary Robbins, Dale Sharbell the Payor, Byron Murray the Payor's accountant and Bernard McCabe the Payor's lawyer attend a meeting (Exhibit R-64, tab. 4).
[927] The purpose of this meeting is to advise Dale Sharbell that his cooperation would determine what direction the investigation is going to take.
[928] Lew Stevenson of HRDC informs those present of the results of the interviews of the fisherpersons.
[929] He gives an overview of the investigation and a summary of the records that were uncovered which all resulted in approximately 20 signed admissions from fisherpersons of false records of employment.
[930] HRDC, in the presence of Revenue Canada Officer, Gary Robbins advises Dale Sharbell of the options that exist for HRDC.
[931] Dale Sharbell is advised that the employer penalty could be handled internally or that the records be turned over to the RCMP for criminal prosecution.
[932] Time is requested by the Payor's lawyer and another meeting is scheduled for December 18, 1995.
[933] On December 14, 1995, after the 15-day deadline given to Dale Sharbell by Garry Robbins on November 29, 1995, the Rulings Officer receives approximately 50 requests from HRDC to rule on fisherpersons.
[934] The same day 50 letters are sent out by Gary Robbins, with questionnaires. These letters request the assistance of the Appellants in determining their insurable earnings from the Payor in 1992 and 1993. They are also told that HRDC has requested an insurability ruling on their earnings from the Payor. Curiously the Rulings Officer is requesting the exact same information as that requested in the notices sent to the fisherpersons in early 1995 (see Exhibit R-55-1).
[935] One could wonder why letters and questionnaires would be sent out to fisherpersons without having the benefit of knowing what Dale Sharbell is going to do without the discrepancy discovered on November 29, 1995 as to the excess of the Payor's revenue over recorded sales, not yet being resolved. The effort is clear: Dale Sharbell must refute the QMP scribblers and more documentation is required by HRDC and the Respondent.
[936]On December 18, 1995, a second meeting between the same representatives as at the December 8 meeting, takes place at the office of HRDC in Summerside.
[937] What is HRDC and the Respondent looking for?
[938] The Payor and his lawyer are advised that no new meeting will be held unless Dale Sharbell is prepared to make a truthful statement as to the accuracy of the QMP scribblers. It is agreed that if Dale Sharbell was to make a truthful statement his lawyer, Mr. McCabe, would contact HRDC to set a meeting for January 3, 1996.
[939] Lew Stevenson of HRDC is also advised that in the meantime he would be in touch with Commercial Crime in order to begin prosecution proceedings in the event that no admission be made.
[940] The purpose is clear; if Dale Sharbell does not give a statement that would satisfy HRDC and the Respondent, criminal proceedings will be commenced.
[941] On December 18, 1995, the Rulings Officer is now in the process of requesting from HRDC as many additional requests for rulings as possible. The Law requires that rulings be requested by HRDC not the reverse.
[942] On December 20, 1995, a description of the Rulings Officer's plan is as follows:
"The plan is to rule on ROE's in a consistent manner for both 1992 and 1993 using the scribbler records as the basis of any adjustments. The scribbler records will be used for those periods where the purchases in scribblers track through and match with sales from invoices. There are some weeks, mainly in 1992, where there are more sales than there are purchases recorded in scribblers. For these periods it is obvious that not all purchases are recorded in the scribblers and therefore the benefit of the doubt will be given to any fishermen who have weeks on their ROE's that fit into these periods. This being the case no adjustments will be made to any weeks on a ROE where the scribbler information does not match with the sales information. The payor has been given an opportunity to provide information regarding any additional sales, over and above the invoices we already have, and he has failed to do so." (Underlining by the undersigned)
[943] It is therefore decided, on December 20, 1995, that the QMP scribblers are reliable and 107 fisherpersons have been sent questionnaires including the "test files" of September 5, 1995, yet the Rulings Officer has not yet resolved the problem he encountered on November 29, 1995.
[944] Dale Sharbell had not yet submitted to the threat of Lew Stevenson of December 8 and 18, 1995 as to the giving of a statement and the HRDC investigation is not over.
[945] On January 2, 1996, the Rulings Officer is in touch with HRDC which is still working on what was termed "comparison packages for 1992 speared eels and bar clams". This was briefly explained but no one from HRDC was heard to really clarify what actual results were tabulated by that department.
[946] On January 3, 1996, the Rulings Officer attends a third meeting with the representative of HRDC and the Payor's lawyer, Bernard McCabe, as a result of the earlier request made by Lew Stevenson to Dale Sharbell.
[947] HRDC and the Respondent are officially advised by the Payor's lawyer, Bernard McCabe, that the QMP scribblers were falsified records made up for the purpose of satisfying the Department of Fisheries and Oceans requirements.
[948] They were also advised by Bernard McCabe that an analysis of the QMP scribblers could not be completed due to missing information which presumably was at HRDC. What was missing were the sales tapes of the Payor which were remitted weekly to the accountant.
[949] What must be underlined here is that undated notes of these meetings of December 8 and 18, 1995 and January 3, 1996 were filed by HRDC (Exhibit R-64, tab. 3, p. 4) and Gary Robbin's diary(Exhibit R-64, tab. 4, pp. 10, 11 and 13).
[950] Curiously HRDC investigators report that Dale Sharbell at the December 18, 1995 meeting just sat at the office and did not say anything and did not respond to any questions and a meeting was set for January 3, 1996 if Dale Sharbell was prepared to answer questions. There is no mention in this HRDC report of the options of HRDC or threats of criminal prosecution possibilities, or the request by HRDC of a truthful statement.
[951] Although the Rulings Officer did not consider the HRDC report (Exhibit R-64, tab. 3, pp. 1 to 3) he affirmed, in answers to questions put to him by counsel for the Respondent, that the undated summary of meetings prepared by HRDC officials held at the office of HRDC with Dale Sharbell and himself (Exhibit R-64, tab. 3, p. 4) in December 1995 and January 1996 accurately reflected what took place (pp. 160 and 162 of the transcript of Mach 10, 1999). This was a contradiction to what is revealed in his own diary for December 8 and 18, 1995 (Exhibit R-64, tab.4, p.10 to 12) which he was not referred to and did not retract.
[952] If the questions put to Mr. Robbins by counsel for the respondent as to the subject matter of the meetings of December 8 and 18, 1995 was to confirm the undated notes of Lew Stevenson and Joe Pierce, this Court did not accept it. Notes written by others cannot be confirmed by a third party who did not participate in making them.
[953] When one reads Gary Robbins' notes from his diary in relations to these same meetings one can readily understand why Dale Sharbell sat there and said nothing and had no answers to give at the time. He was represented by his lawyer and being threatened with criminal prosecution might have had the same effect on any person in Dale Sharbell's situation.
[954] The report of Garry Robbins in his diary coupled with the attitude of Dale Sharbell and the request of a delay by Mr. McCabe is more in keeping with what actually took place than an undated report made by persons who were not heard and subjected to cross-examination.
[955] He is told that HRDC is of the opinion that he knowingly made false or misleading statements in issuing in 1993 and 1994 records of employment to 98 fisherpersons. Some of the names of the Appellants are listed in the letters mentioned above. No mention is made of the 1992 ROE's. Why? The Act may supply an answer but the Court was never told. No evidence was heard before this Court to demonstrate that an investigation of HRDC was able to conclude that Dale Sharbell knowingly made false statements in issuing ROE's.
[956] What happened to the fisherpersons in general and the Appellants in particular? The ruling process of the Respondent proceeded as scheduled and HRDC had not yet completed its investigation.
[957] What was the real purpose of the rulings at this time? Gary Robbins in his testimony stated that he would not be surprised if by the ruling decisions pressure was put on Dale Sharbell by the community to provide more books and records if they existed (p. 44 of the transcript of March 11, 1999). What pressure was he talking about? What was HRDC and the Minister looking for? What were they doing?
[958] The summary of events as already previously stated is as follows:
[959] HRDC is aware of the QMP scribblers since 1994.
[960] HRDC and the Respondent were aware of the existence of the QMP scribblers going back to at least January 1995.
[961] They had ordered the fisherpersons to report in order to collect information about the Payor, to establish their claims for benefits for 1992, 1993 or 1994, to supply documentation to establish their insurable earnings (Exhibit R-55-1) and investigate the falsification of the ROE's of the Payor.
[962] Gary Robbins is the person chosen to represent the Minister and assist HRDC in its investigation (Exhibit R-55-1).
[963] Gary Robbins is pulled out of the interviews as he explained, but he returns to what he said was his own investigation in September 1995. The evidence shows that he may have interrupted his sitting in on the interviews but it is clear from the diary that he was attending all the meetings with HRDC investigators and with them were looking for more information, books and records from the Payor.
[964] On December 8, 1995, Gary Robbins is in the same room with the HRDC investigators, Dale Sharbell, Bryan Murray, the Payor's accountant and the Payor's lawyer, Bernard McCabe. What is taking place?
[965] HRDC investigators in the presence of the Minister's representative, Gary Robbins is offering a deal to Dale Sharbell which is to handle the employer's penalty internally or turn the records over to the RCMP for criminal prosecution (Exhibit R-64, tab. 4, p. 10); a coercive method to put it lightly. What penalty are they talking about? Has the investigation revealed what the penalty was? It was not said.
[966] While waiting for Dale Sharbell to decide in consultation with his attorney, Gary Robbins, the Rulings Officer, sends out questionnaires and covering letters to fisherpersons.
[967] All these letters are sent out between December 14 and December 20, 1995, after the meeting of December 8, 1995 and before the January 3, 1996 meeting.
[968] It is on January 3, 1996, that the Payor through his attorney advises HRDC and the Minister that the QMP scribblers are falsified.
[969] Why all the meetings and threats of prosecution? The evident conclusion of HRDC and Gary Robbins is that they are not satisfied with the QMP scribblers and the $93,000.00 discrepancy in the income tax statement of the Payor is not resolved and probably other matters that were not revealed.
[970] They are also convinced that false ROE's have been made up because of the admission of certain fisherpersons. They have threatened Dale Sharbell who has consistently said that the QMP scribblers were falsified and made up.
[971] What this conduct of HRDC and the Respondent looks like is that they decided to rule on the fisherpersons to put pressure on Dale Sharbell. This is what Gary Robbins appears to be implying when he said that he would not be surprised that pressure be put on Dale Sharbell as a result of the rulings. One must not overlook the fact that the Minister is looking for more documentation but did not seek a search warrant to attempt to find any from the Payor.
[972] The Rulings Officer's diary for the month of December 1995 and January 1996 reveal that the common inquiry of HRDC and the Rulings Officer has reached the point where Dale Sharbell of the Payor is confronted with the results of the investigation.
[973] The HRDC investigator, Lew Stevenson, outlined to Dale Sharbell the options he had. He suggested that the employer penalty be handled internally or he could turn the records over to the RCMP for criminal prosecution.
[974] Byron Murray indicated to those present that his accounting firm did not conduct an audit of the Payor's records and could not detect major discrepancies between actual purchases and the amounts of the DFO slips, as alleged by HRDC.
[975] The accountant provided a summary of the process followed to prepare the ROE's of fisherpersons. He informed that his office never received copies of any sale invoices and would not have been able to compare them to the DFO slips issued to the fisherpersons.
[976] He advised that the sales and purchases figures for the financial statements were taken from the DFO slips and the weekly sales figures given to his office by the Payor.
[977] On December 18, 1995, Byron Murray provided to HRDC investigators and the Rulings Officer a brief summary of what process was followed at his office in preparing the ROE's.
[978] Lew Stevenson admitted that in his remarks at the meeting of December 8, 1995, he did not mean to imply any fraudulent practices on behalf of the offices of Byron Murray, when discussing the differences between the sales books and the DFO slips of the Payor. This would then normally leave the Payor as the person to have any other documentation and not the accountant.
[979] Lew Stevenson of HRDC, requested from Dale Sharbell a truthful statement as to the accuracy of the QMP scribblers and if no admission was to be made the matter would be referred to the commercial crime section of the RCMP for prosecution proceedings.
[980] This evidence appeared to be the culmination of the common investigation of HRDC and the Rulings Officer into the actions of persons contrary to the Act, which began in early 1995 (Exhibit R-55-1).
[981] The threat that is made here by Lew Stevenson is not taken lightly as we can see from the request from Bernard McCabe the Payor's lawyer (Exhibit R-64, tab. 4, p. 11).
[982] A third meeting is scheduled for January 3, 1996, where Bernard McCabe officially advises HRDC and the Respondent that the QMP scribblers were inaccurate, incomplete and falsified records (Exhibit R-64, tab.4, p.13).
[983] This information of falsified or incomplete QMP records was known to both HRDC and the Respondent in the statement of Martin Smith which was given to Lew Stevenson in the presence of the Rulings Officer on March 15, 1995 (Exhibit R-28-10).
[984] The only conclusion then is that HRDC and the Respondent are attempting to threaten Dale Sharbell at the end of 1995 to make some admission or face criminal prosecution. The letter of Bernard McCabe was a confirmation of what HRDC and the Respondent already knew. This letter was not shown to the Court.
[985] This last effort of HRDC and the Rulings Officer did not result in criminal prosecution either. Why? The Court was never told.
[986] What one can deduct however from such conduct is that HRDC and the Respondent had no probable grounds to believe that Dale Sharbell or any Appellants had committed an offence contrary to the Act. No evidence showed that any fisherperson who allegedly admitted some wrongdoing was ever prosecuted.
[987] HRDC and the Rulings Officer had not resolved the discrepancy between the Payor's sales reported in the tax return and the Payor's sales books before ruling decisions were made.
[988] In fact, Gary Robbins never compared the amounts shown on the Payor's DFO slips with what was shown on the Payor's income tax return (p.145 of the transcript of March 10, 1999).
[989] Both HRDC and Gary Robbins were aware that the financial statements were made up by the accountant with the DFO slips issued to the fisherpersons and were then officially advised that the QMP scribblers are falsified on January 3, 1996.
[990] Did the threat of criminal prosecution result in the admission of Dale Sharbell on January 3, 1996? What can be said is that the threat produced the letter of Bernard McCabe which confirmed what Dale Sharbell had told Gary Robbins in the fall of 1995 and what Martin Smith had also said on March 15, 1995.
[991] What also can be said is that Dale Sharbell, the principal target of the investigation, would likely be less than cooperative with HRDC and the Rulings Officer.
[992] What would a citizen do under such circumstances? It is difficult to say. But to consult a lawyer and get advice and relay to HRDC and the Respondent the statement, requested at the December 18 meeting, was the result.
[993] But while HRDC and Gary Robbins, after conducting the meetings of December 8 and 18, 1995, are awaiting the results of the Dale Sharbell's reaction and consulting with lawyer Bernard McCabe, what is happening to the fisherpersons?
[994] On December 14, 1995, the Rulings Officer receives 50 requests for rulings from Lew Stevenson and has already prepared questionnaires for the fisherpersons.
[995] The Rulings Officer also takes the initiative to request from HRDC as many additional requests for rulings as possible because he wishes to be in a position to send to the fisherpersons his ruling decisions after Christmas.
[996] The Law does not provide for the Rulings Officer to request ruling decisions be sent to him; the Law provides the exact opposite.
[997] On December 20, 1995, Gary Robbins had elaborated the plan for his rulings and describes how he will rule on the fisherpersons' records of employment in a consistent manner for both 1992 and 1993 using the QMP scribblers as "the basis of any adjustments"; the main reason being that the Payor had been given an opportunity to provide information regarding any additional sales and failed to do so (Exhibit R-64, tab. 4, p. 12).
[998] What is the reason of HRDC for requesting the rulings?
[999] One example, amongst others, is found in the case of the Appellant Janet W. Arsenault (Exhibit A-6, p. 5) as follows:
"Daily delivery records kept by Sharbells Fish Mart do not match amounts listed on Records of Employment issued to Fisherpersons. Shipping records do not match with Records of Employment issued to Fisherpersons."
[1000] We must infer that the daily delivery records were the QMP scribblers.
[1001] No evidence was shown to the Court as to whether the shipping records matched or not with the ROE's of any of the Appellants.
[1002] But why request rulings in December 1995 before Dale Sharbell and his lawyer Bernard McCabe present themselves to the January 3, 1996, meeting at HRDC as a result of the threat of criminal prosecution made by Lew Stevenson?
[1003] We must not lose sight of the fact that HRDC and Revenue Canada are looking for more information, more records or something that will satisfy them.
[1004] The investigation of the QMP scribblers is not over. In fact, Lew Stevenson interviewed Justina Doucette only on July 5, 1996 (Exhibit A-1, tab. 36) long after the Rulings Officer had issued his decisions, and while the appeal process was underway.
[1005] The Rulings Officer also said that he would not have been surprised to see pressure put on Dale Sharbell, by the community of fisherpersons, to produce records, if they existed, as a result of the rulings as many fisherpersons had told him that they were going to contact the Payor (pp. 45-46 of the transcript of March 11, 1999).
[1006] The conduct of HRDC and the Respondent leads to conclude that the requests for rulings of the fisherpersons was another step in the common investigation.
[1007] The implication was that by ruling on the fisherpersons they might succeed in getting Dale Sharbell to solve the problems they had encountered.
[1008] No one except Bernard McCabe questioned the validity of the QMP scribblers. In fact, what Dale Sharbell admitted on January 3, 1996, was not believed by HRDC or the Rulings Officer or later the Appeals Division of the Respondent.
[1009] The Rulings Officer proceeded as scheduled. There was no evidence of even a short recess of a couple of days or a week to assess the statement of Dale Sharbell which was the "truthful statement" asked for by Lew Stevenson on December 18, 1995.
[1010] This statement given after consultations with Bernard McCabe was corroborated by Martin Smith's statement of March 15, 1995.
[1011] Even if the Rulings Officer and HRDC were convinced that the statement was not truthful, for whatever reason, would not one, at least, give a thought that the statement might be true and make Dale Sharbell suffer the consequences of his admission allow HRDC to continue its investigation and inquire into other illegal activities in relation to the allegations of falsified records of employment before continuing any further.
[1012] After all Parliament in the Act, entrusted HRDC with all the investigative powers to ensure that the legislation was being respected and enforced.
[1013] One must look at subsections 94(10) to 94(20) which outlines provisions dealing with the powers of HRDC officials as to the inspection and examination of documents that relate or may relate to information that is or should be contained in the records or books of account or the amount of any benefits payable under the Act.
[1014] Why did HRDC not proceed on its own to carry out a full investigation because, as Lew Stevenson is alleged to have stated to Lynn Loftus the Appeals Officer, he was investigating all fish buyers in P.E.I.
[1015] Why did HRDC not prepare a proper report to the Respondent as to the results of its inspection and examination of the QMP scribblers in relation to what was contained in the pay records or in relation to any amount of benefits payable under the Act? That is what the Act stipulates.
[1016] One of the reasons could be that they had not finished their alleged investigation till October 3, 1996 (Exhibit R-19).
[1017] Obviously, they had no report to submit because it was a common investigation.
[1018] That is probably what may explain the reason for the undated report in Exhibit R-64, tab. 3 and the evidence of Gary Robbins that no report was submitted to him by HRDC.
[1019] Then why, if HRDC did not do the investigation, did the Respondent not carry out a full independent inspection, audit and examination of the Payor's records and accounts as stipulated by section 59 and obtain the services of an independent accountant to help Gary Robbins in understanding the mathematics.
[1020] It is surprising in an investigation of this nature to hear from a Rulings Officer that he could not convert pounds to pecks or pecks to pounds.
[1021] Also surprising is the Appeals Officer report (Exhibit R-64, tab.15, p. 1) where she was unable to do a comparison of quahaug volumes of purchases and sales because the DFO statistic report was in pounds and the QMP scribbler entries were in units.
[1022] The report also states that she was unable to do a comparison of oyster volumes of purchases and sales as the DFO statistics report was in pounds and the QMP records were in pecks.
[1023] Could DFO not give her a hand and convert all the statistics back as they were originally? If they had obtained the original DFO slips from the DFO statistic department, such a difficulty would not have been encountered.
[1024] This is all very difficult to comprehend especially when one considers that the Respondent is about to rule on some 294 fisherpersons who have no idea as to what is in store for them after the January 3, 1996 meeting of HRDC with the Respondent and the Payor's lawyer.
[1025] The Rulings Officer stated in his diary of December 21, 1995 that he had received as of that date 107 ruling requests from HRDC. It was never made clear when the number of 107 went up to 294. Was he ruling on fisherpersons who had only sold to the Payor or was he ruling on fisherpersons who sold to other payors? When were the ruling requests sent to him for the additional 187 fisherpersons after December 21, 1995?
[1026] The Rulings Officer proceeded to send out the ruling decisions based on the QMP scribblers according to the results of his analysis (Exhibit R-64, tab. 7). He also used the QMP reliability chart he had prepared (Exhibit R-64, tab. 66, pp. 1 and 2).
[1027] This undated chart shows that the QMP scribblers are reliable for certain periods and not reliable for other periods.
[1028] The evidence showed that for the periods where the QMP scribblers were not reliable he accepted the DFO slips of the fisherpersons in establishing their earnings.
[1029] One may think that to define calculations as reliable you would base your opinion on something sound and consistent.
[1030] The rulings calculations no matter which way they lean could not be qualified as reliable by the very meek admission of the Rulings Officer himself.
[1031] As of January 3, 1996, he rendered his rulings relying only on the questionnaires he had sent out to the fisherpersons and the notes referred to earlier at the interview stage of March or April 1995.
[1032] He, in essence, decided how he would rule before even hearing from the Appellants for the second time and he had not heard them all the first time.
[1033] The Rulings Officer did not believe Dale Sharbell because if he (Dale Sharbell) was actually creating a false set of records for DFO he could have created records with much less detail. What relation did this have with the fisherpersons conduct in general and the Appellants in particular? Does the amount of detail really matter if a document is falsified?
[1034] The problem would not be so much the details contained in the records but the fact that the Payor had said they were falsified which statement was corroborated by another person, Martin Smith. The effect this could have on the earnings of individual fisherpersons such as the Appellants, who had nothing to do with the QMP scribblers, would also be a difficulty to overcome.
[1035] From the facts outlined above, the Respondent, represented by the Rulings Officer and HRDC, conducted this common investigation having decided in advance that the fisherpersons would be ruled upon.
[1036] In fact on February 14, 1996, Joe Pierce, one of the investigators of HRDC, is still reporting to the Rulings Officer and also questioning the ruling decisions in the case of the Appellant Wayne Milligan (Exhibit B-9, tab. 6).
[1037] Finally, to say that rulings proceeded because the buyer did not supply more records to prove extra sales is a poor excuse for not using the powers under the Law to satisfy oneself that there were no more records available. The Court did not accept this explanation.
[1038] The Rulings Officer stated that the fisherpersons should have kept records in the fashion he described instead of relying on the Payor (pp. 188, 189, 206, 207 and 217 of the transcript of March 11, 1999). How would they know that? The investigation changed courses; the shift in the investigation now was transferred to the fisherpersons records.
[1039] The common investigation of HRDC and the Respondent to the extent and in the manner it was carried out was contrary to what the Law elaborated.
[1040] HRDC and the Respondent are dutifully bound to act at arm's length. A careful reading of the Act demonstrates that Parliament gave the power to HRDC to administer and enforce the provisions of the Act.
[1041] The Respondent's duties are clearly established in section 3 and Part III of the Act.
[1042] It is with this background information in mind that we must now look to the Appeals Division of the Respondent to examine if the correct decision was made.
[1043] The Appellants appealed these ruling decisions.
D- The appeals decisions
[1044] Lynn Loftus, the principal Appeals Officer, was given by the Respondent the responsibility of conducting the investigation of the Rulings Officer's decisions concerning the Appellants and was to suggest to the Chief of Appeals what position should be adopted.
[1045] Her work concerned only those fisherpersons who had appealed to her office, that is 120 who had sold the species of fish covered by the QMP scribblers (Exhibits R-1 and R-2) out of some 294 fishpersons who had received rulings decisions.
[1046] She reviewed all the information from the master file of the Rulings Office which included boxes of records. What the master file contained or looked like was not shown to the Court.
[1047] We do not know how many fisherpersons are represented by the DFO slips computer printouts sent to Mrs. Loftus. We know that she did not ask for or receive the original DFO slips. The printouts were all in pound figures and were not converted to the proper measures for her analysis.
[1048] The diary of Lynn Loftus (Exhibit R-64, pp. 1 to 13), which I have partly included in this decision, gives an overview of what she did.
[1049] She was not the only person involved in making the decision to uphold the ruling decisions of the Respondent which, according to the evidence, was decided after May 30, 1996, when she wrote to Head Office for direction (Exhibit R-64, tab. 13, pp. 1 to 6).
[1050] In her memorandum (Exhibit R-64, tab. 13, pp. 1 to 6), she concludes as follows:
"The above are just a sampling of the files. There are no two alike, although there is common information in each of the files.
Through discussion with the Chief of Appeals, Walter MacDonald, and review of the material at hand, it looks like there is nothing additional to refute the rulings officer's decision. As it stands, we will be using the available information to review each case for any variations based on additional information should any of the Appellants have proof the ruling was incorrect. This may result in small variations in weeks-ending or amounts. However, the common information indicates the QMP scribbler information on purchases by the buyer is closest to the figures for sales of product by the buyer. The figures found on the DFO slips are so far out of line with purchases and sales, that they are not reliable. There has been no information regarding unreported sales provided by the buyer or his accountant, although ample time has been allowed, so the purchases have been accepted as shown on the QMP records. The Department of Justice have expressed an opinion that with proper handling of the case the QMP records could be introduced and used in court.
Before any recommendations are made and determinations issued, we are requesting that you review our progress to date. I have enclosed a copy of what we call The Master File; the body of the CPT 110 and the diary of events, I have also included the four files mentioned above. I believe they should be relatively clear, but then I've become so familiar with the files that I may be "missing the forest for the trees". If you should need clarification on anything, or if you wish to discuss the files, please call me at (902) 628-4231. We will continue to do interviews on the remaining files but will hold any determination letters until we hear from you." (underlining by the undersigned)
[1051] So because the entries of purchases in the QMP scribblers are the closest to the figures for sales of product sold by the Payor, the use of the QMP scribblers is accepted. The purchases of the Payor will be those shown in the QMP scribblers (Exhibits R-1 and R-2).
[1052] She also concludes that the figures found on the DFO slips are so far out of line with purchases and sales that the DFO slips are not reliable and not accepted.
[1053] She also concludes that since there is no information about unreported sales, she accepted the QMP records. No search warrant was requested to ensure that no further records were available.
[1054] She also relied on the fact that Justice had expressed the opinion that with proper handling of the case the QMP records could be introduced and used in Court. What was meant by the term "proper handling" was never explained to the Court.
[1055] The focus, if I may use the term, was the use of the QMP scribblers as a record to determine the insurable earnings of the fisherpersons in general and the Appellants in particular.
[1056] The Appeals Officer said that the payroll books of the Payor for 1992 and 1993 were made up from the information on the DFO slips issued to the Appellants by the Payor.
[1057] Since doubt had been cast on the DFO slips, she was not going to use the payroll books because the DFO slips were inaccurate. What determined the doubt about the DFO slips was that "there was people who had admitted that they had been issued falsely" (pp. 97 to 110 of the transcript of April 6, 1999). Also somebody had questions about Sharbell inflating somebody's DFO slips (p. 203 of the transcript of April 12, 1999).
[1058] This statement or words to that effect were repeated on several occasions throughout the examination, cross-examination and re-examination of Lynn Loftus.
[1059] No evidence was shown to conclude that inflated or false DFO slips or ROE's had been issued to any of the Appellants.
[1060] The Appeals Officer then questiond Dale Sharbell.
[1061] She was advised that the QMP scribblers were not the proper books to rely on.
[1062] She did not meet with Martin Smith who was the person responsible at the Payor's establishment in 1993 for QMP records (p. 209 of the transcript of March 12, 1999) although in direct examination she maintained that she had (p. 78 of the transcript of March 12, 1999).
[1063] It was only after the appeals process had began that she found out from Donna Lewis, one of the Appellants, that Martin Smith had given a statement which would have corroborated Dale Sharbell's assertion that the QMP scribblers were not reliable.
[1064] She did not interview Jason Bulger who was the other person who worked at weighing fish with Martin Smith and issued the slip of paper to the fisherpersons with the weight of fish, the species and, when necessary, the names of fisherpersons if Dale Sharbell did not know them.
[1065] Obviously, she was not able to convey in her report to Head Office or to the Department of Justice that the falsification of the QMP records was corroborated by the employee, who under the Fish Inspection Regulations, was responsible for the recordings in the QMP scribblers in 1993 and the same person who helped Dale Sharbell in 1992.
[1066] One must not overlook the fact that the Rulings Officer ignored the statement of Martin Smith and also did not meet with Jason Bulger. The evidence of these two witnesses was very important in relation to the QMP and the process adopted by the Payor in weighing fish and dealing with the Appellants on a daily basis.
[1067] HRDC had not provided a copy of Martin Smith's statement to the Appeals Officer. Martin Smith was not relied upon and was not an Appellant in these hearings.
[1068] In fact, HRDC did not submit a report either to the Rulings Officer or to the Appeals Officer.
[1069] Curiously in her report to Head Office, she refers to an investigation by HRDC in late 1994, where Lew Stevenson would have borrowed business records of the Payor for 1992 and 1993 and compared purchases of fish to sales.
[1070] She goes on to say that the monthly sales were substantially lower than the DFO slips issued to fisherpersons for purchases which in turn were used to prepare records of earnings and T4 slips for fishers.
[1071] No conclusion of total T4 slips was made to compare to the total of DFO slips issued by the Payor or compared to the Payor's tax returns for 1992 or 1993.
[1072] But what report of this investigation was given to the Appeals Officer? What were the borrowed records? Were they the QMP scribblers? This was far from clear.
[1073] The HRDC report filed by the Respondent as referred to earlier is undated (Exhibit R-64, tab. 3), was not considered by the Rulings Officer (p. 161 of the transcript of March 10, 1999) and was not made up till after the ruling decisions. If we consider that Lew Stevenson interviewed Justina Doucette of DFO only on July 5, 1996, it would or should follow that he would not have made up a report before he finished his investigation.
[1074] It is not known whether Lynn Loftus was provided with the original diaries of Gary Robbins which would have probably made up the Court Exhibit (Exhibit R-64, tab. 4). No original diaries were shown to the Court.
[1075] The Appeals Officer called Lew Stevenson on May 30, 1996, the day she made up her report to Head Office (Exhibit R-64, tab. 12, p. 10).
[1076] It is during this telephone conversation that she is advised what prompted the investigation of all fish buyers in P.E.I.
[1077] He informed her that he had done a sampling of several fish plants to see if DFO slips (purchases) and sales of product matched as suspicion had been raised after some fishers had indicated the DFO slips (purchases) were inflated by some buyers which resulted in an on-going investigation into all shellfish buyers on P.E.I.
[1078] He also told her, that some fisherpersons he had interviewed had said that their DFO slips and ROE's were false.
[1079] Further, the Appeals Officer also sent to Head Office, her CPT 110 report (Exhibit R-64, tab. 11), and an opinion from the Department of Justice in Halifax which would have indicated that with proper handling of the case the QMP records could be introduced and used in Court (Exhibit R-64, tab.13, p.3). What was meant by this was never explained.
[1080] A reply to her report to Head Office was sent to her superior, Walter MacDonald, the Chief of Appeals (Exhibit R-68).
[1081] The Chief of Appeals is told that there is sufficient information in the file to demonstrate to a judge that the records presented by the employer were inadequate and that the Department is justified in making estimations and that the CPT 110 summary should indicate that the Respondent had acted in accordance with section 80 of the Regulations.
[1082] This is the first occasion we see in evidence a reference to estimating earnings under section 80.
[1083] Nothing in that report suggests what actual records they are referring to.
[1084] The Chief of Appeals is also told that fisherpersons are self-employed persons who would not normally participate in the insurance plan and that the Regulations should be interpreted narrowly.
[1085] The Chief of Appeals is also informed that the decision in each case is highly related to the credibility of the situation alleged by the parties and the Appeals Officer who worked on the file is normally the best person for judging the credibility of a particular case which is in effect a judgment call.
[1086] The possibility of falsification of records by the buyer is not considered and no reference is made to the QMP or the record keeping thereunder.
[1087] Did the Chief of Appeals, who ultimately was the person responsible for the decision to proceed along with the Appeals Officers, evaluate the probable falsification of records as it could affect each individual fisherperson in general or the Appellants in particular in analyzing the credibility of the situation and making the judgment call referred to by Head Office? What was discussed as to the QMP regulations and record keeping which began in 1992?
[1088] What complete instructions were given as to estimating earnings as a result of adequate or inadequate records and section 80 of the Regulations as suggested in June of 1996 by Head Office.
[1089] The Chief of Appeals was not heard to convey to the Court how he would have directed the opinion-making process since it was said that it was under his direction that Lynn Loftus made her decision which was adopted and followed by the other Appeals Officers, Rosemarie Ford, Patricia Griffin, Elizabeth Whyte and Don MacLean
[1090] It was also under the direction of Walter MacDonald that all the Appeals Officers made their decisions and submitted their reports for review. As it will be shown in the case of Kevin Robinson, the Appeals Officer changed her decision at the request of the Chief of Appeals.
[1091] Basically then after all the reporting, interviews, consulting, meetings, obtaining opinions from Justice and deliberating, it was decided to uphold the Rulings Officer's basic decision that the QMP scribblers (Exhibits R-1 and R-2) were reliable and that the fisherpersons in general and the Appellants in particular would be called upon to furnish additional information and prove their cases depending on the situation of each Appellant which is discussed at length in the concluding analysis of each individual Appellant (Exhibit R-64, tab. 13, pp. 1 to 6).
[1092] The Appeals Officer's method of deciding was the same method applied by the Rulings Officer. Whatever opinion the Rulings Officer came to the Appeals Officer followed except for some minor variations.
[1093] The DFO slips of the Appellants were not relied upon by the Appeals Officers for the periods outlined in what was termed a reliability chart.
[1094] None of the Appeals Officers, except Lynn Loftus, had carried out on their own a study of the QMP scribblers.
[1095] No Appeals Officers appeared to have discussed among themselves what the purpose of the QMP scribblers was. No study was made of the Regulations as adopted in 1992.
[1096] In the submissions of the Respondent the Court was not provided with any reference to the Fish Inspection Regulations dealing specifically with the QMP and what it meant and what direct relation it should have as to what was required by Law in these records.
[1097] It would appear that the Appeals Officers relied upon the reliability chart (Exhibit R-64, Tab. 6), of the QMP scribblers without questions asked although when they testified it appeared from their answers and demeanour that they were not too happy with what they were confronted with when the files of fisherpersons crossed their desks.
[1098] One officer even described her situation as having her hands tied. It was apparent that they did not allow earnings even though they were convinced that the person was truthful, honest and was in possession of the DFO slip receipts for fishing.
[1099] Unfortunately the opinion of the Appeals Division was not founded on very solid premises.
[1100] What was the opinion of the Minister based upon?
[1101] The Rulings Officer did not refer to section 80 in his letters to the Appellants. He established the earnings according to section 79.
[1102] It appeared that the decision to say they were proceeding under section 80 of the Fishermen's Regulations came later.
[1103] In fact, the Appeals Officer's study was to decide which set of records she was going to use or what set of records was more credible.
[1104] Her choice was between the DFO slips and the QMP scribblers and not that the records to be kept for unemployment insurance purposes were accurate or inaccurate.
[1105] Both sets of documents were, according to the Respondent, used to record purchases of the Payor from the fisherpersons.
[1106] Lynn Loftus even said that the QMP looked as if it had a dual purpose (p. 119 of the transcript of April 12, 1999). She seemed to be convinced that Dale Sharbell was using the QMP records as a daily delivery record and ultimately decided that these records were more accurate than the DFO slips when she compared them to the Payor's sales.
[1107] She was also convinced that since she was told by Gary Robbins and Lew Stevenson that DFO slips had been inflated or that false ROE's had been submitted, the DFO slips were doubtful and she did not rely on them.
[1108] Because the DFO slips were what was used by the Payor to make up the ROE's, the Appeals Officer saw no need really to rely on the Payor's pay records for 1992 or 1993.
[1109] In fact she did not even have in her possession for her study the Payor's payroll book for 1992 but only had parts of the 1993 payroll book.
[1110] The only part of the 1993 payroll book she had was for those fisherpersons who had appealed and had sold the species of fish shown in the only scribblers filed in Court (Exhibits R-1 and R-2).
[1111] The delivery by other fisherpersons of other species was not looked at because she said no QMP scribblers or records for those species were required but what the QMP actually required was records for all species that were to be exported which meant not only the species mentioned in the scribblers she was reviewing.
[1112] Now if DFO slips were inflated or if false ROE's were issued, how could one know what species we are dealing with or investigating?
[1113] The suggested reasoning of the Respondent was that only fisherpersons, dealing with eels and bivalve molluscs, had inflated DFO's or false ROE's, because those species of fish were the only ones represented in the QMP scribblers (Exhibits R-1 and R-2).
[1114] Therefore is the Court to conclude that no fisherperson who sold other species of fish to the Payor was suspected?
[1115] Because some people, not appellants, made statements of inflated DFO slips or false ROE's, in what way could this affect the individual and particular delivery of fish of the Appellants?
[1116] Would it not be necessary in some way to connect the individual Appellant to the falsified ROE's or inflated DFO's in order to test the value and weight of the Rulings Officer's decision as to each Appellant's sales that made up his or her insurable earnings.
[1117] The only evidence Lynn Loftus had that DFO slips were inflated by any Appellants, was what she was told by Gary Robbins and Lew Stevenson, which was contradictory hearsay evidence in relation to anyone of the Appellants before the Court.
[1118] Lynn Loftus even questioned Gary Robbins about his use of the price of fish showing on the DFO slips. He replied: "that chances were the price would not be inflated but the quantity would be", seemed to satisfy the Appeals Officer. Would such a position be satisfactory or reliable?
[1119] If someone is inflating the DFO slips on what evidence was Gary Robbins basing his assumption that it only had to do with the weight and not the price? We will never know.
[1120] Looking at the results of the studies made by Garry Robbins and Lynn Loftus, would the figures be accurate enough to be relied upon in order to set a worker's earnings?
[1121] No percentage of accuracy was determined. No approximate reasonable accuracy was even discussed.
[1122] The Appeals Officer knew that the Payor's purchases as reported in his income tax return for the 1993 year, was higher than what he reported in sales. Would it not be necessary to first add up the original DFO slips issued to fisherpersons dealing in all species to see what the total purchases were, in analyzing the income tax return?
[1123] She admitted that the Court record contained only part of the financial documentation of the Payor.
[1124] The suggestion that the Appeals Officer did not look at all the financial documentation of the Payor was especially admitted by Lynn Loftus when she was cross-examined by counsel for the Appellant Claudette Gallant.
[1125] No DFO slips would be issued by the Payor to other buyers who would deliver fish to the Payor. How many other buyers sold fish to the Payor? The Court does not know.
[1126] Lynn Loftus, as did the Rulings Officer, was content and satisfied that Dale Sharbell had no more documentation to supply to the Respondent.
[1127] They both use the same terminology that the Payor had ample time to forward more documentation. Why were they looking for more documentation from the Payor and at the same time doing nothing, which the Act allows them to do, to get whatever is required? Did they not know or were they not advised of the power under the Act which would allow them to be sure that there were no more books and records.
[1128] Were they satisfied that the Payor had no more books? It looks that way.
[1129] Would it not be logical to conclude that if the Respondent really thought that Dale Sharbell was retaining certain documentation, that he would or should have proceeded to obtain same, by legal means, according to what is set out in the Act?
[1130] Nothing was done to obtain further documentation, books or records. Why? No real answer was given. The position of the Respondent here is difficult to comprehend and accept.
[1131] In fact, Lynn Loftus said that Dale Sharbell was very cooperative.
[1132] The fact that Dale Sharbell came to the hearings with the pay records of 1992 (Exhibit R-20) does not mean that the Minister did not have them or was not able to look at it. It goes to show that the Minister could have obtained them.
[1133] The evidence showed that the Minister did have at least copies of this 1992 payroll in some of the Appellants' files.
[1134] As an example see the file of Allan Coughlin (Exhibit R-31, p. 15) and compare it with Exhibit R-20 volume 3, p. 105.
[1135] The evidence as a whole demonstrated that the Payor and his accountant furnished all the documents available for unemployment insurance purposes.
[1136] The QMP scribblers (Exhibits R-1 and R-2) were never supplied to the bookkeepers by the Payor in either the 1992 or 1993 years and were (pp. 134 to 137 of the transcript of March 10, 1999) not part of the record keeping for unemployment insurance purposes of any of the Appellants or for any other fisherpersons registered by the Payor for the insurance plan.
[1137] Had the QMP scribblers not existed what would have happened?
[1138] The answer to the above question was given by Lynn Loftus when she said that probably the existing records would have been left stand (p. 100 of the transcript of April 6, 1999).
[1139] But if she did not use the DFO slips or the QMP scribblers what was her other option?
[1140] She replied that she could have denied everything (p. 101 of the transcript of April 6, 1999).
[1141] She has explained on March 12, 1999 (p. 112 and foll of the transcript of March 12, 1999) that one of her options was to make nothing insurable because, according to her, the records were not reliable enough, but she did not want to do that because of the number of people involved.
[1142] But why would the number of people involved have anything to do with the reliability, or exactness, or value of the QMP scribblers?
[1143] Is the Court to understand that if it had only been a few people she would have acted differently and the opinion of the Respondent would have been different?
[1144] If you are certain of the path you are following, why would the number of people be a concern or the result of your decision be a concern?
[1145] If the number of people was a concern, would not the falsification of the records that she was about to use in these appeals also be a concern especially because of the number of people it might affect?
[1146] The Court had a lot of sympathy for all the Appeals Officers who were faced with a situation beyond their personal control.
[1147] In the view of the Court, they were ill-advised and left to themselves in a blitz to get the determinations out as quickly as possible.
[1148] The guideline rules were set in advance before the Appellants were not even heard or sent their questionnaires.
[1149] The reliability chart of Gary Robbins (Exhibit R-64, tab. 6) was paramount and was the course to follow.
[1150] If an Appellant produced or showed a DFO slip for his or her deliveries for a date which had been determined as reliable (QMP reliability Chart, Exhibit R-64, tab. 6) it was not accepted unless the Appellant could prove the Rulings Officer's decision to be incorrect which in fact meant that he or she would have to prove the QMP scribblers were incorrect.
[1151] Would one not wonder how someone could prove a document to be incorrect if that person had not participated in some way in making the document?
[1152] None of the Appellants took any part in making up or recording anything in the QMP scribblers.
[1153] If an Appellant produced or showed DFO slips for deliveries made on dates which had been determined unreliable by the said chart, they were accepted "because there was nothing to refute them" (Lynn Loftus, p. 113 of the transcript of March 12, 1999).
[1154] Was the Respondent accepting the DFO slips of the Appellants because the Appeals Officer could not refute them? This reasoning was difficult to comprehend or even to accept.
[1155] If some persons whose names were not in the QMP scribblers but had in their possession DFO slips and ROE's they were not considered to have insurable earnings.
[1156] If the name of persons listed in the QMP scribblers claimed not to have fished had no DFO slips or ROE's, they were investigated as to whether they were receiving unemployment insurance benefits or whether they were on social assistance. If that were the case, it would be a benefit to them not to have their names in the QMP scribblers because their credibility came into question (Lynn Loftus, p. 115 and foll. of the transcript of March 12, 1999).
[1157] A person who was working at another job, or a person not working and without any source of income, or a person with no visible means of support was also investigated and his/her credibility questioned (Lynn Loftus, pp. 115-116 of the transcript of March 12, 1999).
[1158] Curiously, Lynn Loftus did convey to the Court that there were instances where fisherpersons satisfied her that they could not have fished and sold to Sharbell. Those persons, she said, were not in Court at the appeal stage.
[1159] She gave one example where a person was hospitalized, but no names were given.
[1160] The cross-examination of the Appeals Officers, especially by counsel for the Appellants as to how someone could prove that he or she had not fished, was thoroughly canvassed and the replies could not be particularly accepted as reasonable in the circumstances described in these appeals.
[1161] It appeared quite evident that the Appeals Officers were not only attempting to establish earnings but the trend of thought or mindset was an investigative process far beyond the insurable earnings and the collection of premiums.
[1162] It conclusively showed that the investigative process was continuing where HRDC and Rulings left off.
[1163] The Respondent appeared to take some comfort in the fact that some fisherpersons did not appeal the ruling decisions or appeal to this Court.
[1164] Surely no serious conclusion can be inferred, from such conduct, without knowing what real reasons influenced their decisions, but the Appellants may question whether this whole episode was not directed, with a purpose to rule on them, in order to subject them to the appeal process in order to continue the common investigation and obtain more information about the Payor and how he managed his record keeping.
[1165] The appeal process went far beyond insurable earnings and collection of premiums when one considers that names in a scribbler alone could result in insurable earnings being awarded to individuals who did not appear in the bookkeepers' records.
[1166] How could the Minister determine that the Payor's records kept by the bookkeeper in 1992 or the accountant in 1993 for earnings and premiums be adequate or not adequate for individuals who were not listed in those records and prima facie were not insured under the Fishermen's Regulations. If some persons such as a Mr. Getson was not an insured person how could the Minister estimate earnings of insured fisherpersons?
[1167] Could persons not sell fish to the Payor without taking part in the insurance plan?
[1168] Did the Appeals Officers estimate the earnings?
[1169] If one reads the evidence of the Rulings Officer and Appeals Officer we can see that the decision was first to decide what options were open to them.
[1170] They chose to use both sets of records discussed above in the following manner.
[1171] They used the entries made in the QMP records according to the reliability chart as explained. This was not an estimate, it was the actual entries.
[1172] In accepting to use the QMP records or scribblers in that fashion they automatically ignored or set aside any DFO slip in possession of an Appellant, which fell in the alleged reliable periods of the QMP. This was not an estimate.
[1173] They accepted the DFO slips or receipts that the Appellants had in their possession for the periods that the Respondent decided that the QMP records were not reliable. This was not an estimate.
[1174] They did not consider the DFO slips in the possession of Appellants if such persons did not have their names in the QMP scribblers. This was not an estimate.
[1175] They used the QMP scribblers of the Payor to create insurable Appellants whose names were in the QMP scribblers and had no ROE or DFO slips. In fact, here they were adding persons to the Payor's records as insured persons. This was not an estimate. Did Mr. Getson, a fish buyer who sold to the Payor, become an insured person?
[1176] Did the Appeals Officer estimate the period during which the catches of each Appellant was made according to paragraph 80(2)(a)? They determined the period according to the QMP entries or the DFO slip; this was not an estimate.
[1177] Did the Appeals Officer estimate the number of fisherpersons involved in any catch and the earnings of each fisherperson for each week in accordance with paragraphs 80(2)(c) and (d)? Whichever period they accepted was not estimated but decided according to the entries in the QMP scribblers or the DFO slip.
[1178] They decided that the DFO slips were inaccurate for certain periods because of the existence of the entries in the QMP scribblers for those periods. This was not an estimate.
[1179] They said or decided nothing with regards to premiums which is the other side of the same coin as earnings when dealing with the insurance plan. The premiums of the employer were not estimated.
[1180] The fact that this is done by another department is of no help to the Court in deciding what the real opinion was based upon.
[1181] No evidence showed whether they had determined the aggregate earnings of all fisherpersons that should not exceed the gross returns of all the catches in compliance with subsection 80(3) of the Regulations.
[1182] Does subsection 80(4) of the Regulations not stipulate that the Officer of Taxation in computing and estimating the total earnings from which the premiums are determined, shall exclude earnings of any fisherman who is not insured or any fisherman in respect of whom the records are adequate? Would this not indicate that the Minister would have to determine those who were not insured and those for whom the records were adequate in carrying out his compilations and in estimating the earnings and premiums?
[1183] Also, the evidence did not show, though it was the first inspection of the Payor's books and pay records, whether the Minister contemplated the method suggested by subsection 80(5) of the Regulations.
[1184] The word "estimate" was certainly used at the hearing by Lynn Loftus, the principal Appeals Officer, but the Court must not simply rely on words but on what was actually done and on the work performed by the Appeals Officers.
[1185] The Court was not convinced that estimates were made in the case of any Appellant and this is particularly noticeable in the letters of decisions sent to the Appellants by the Respondent where there is only a reference to section 80 of the Regulations.
[1186] When the information in these letters is then compared with the information in the penalty letters received from HRDC as a direct result of the Respondent's decisions, one may now understand that the purpose of the investigation was that the Appellants had allegedly given false statements when submitting their claims for unemployment insurance benefits.
[1187] The Respondent objected to the production of these penalty letters. It is true that the penalty may not be relevant per se to the decision but the alleged misconduct contained in these letters is because these Appellants had been told that they committed a crime, to which they disagreed. When analyzing all the evidence we now see that HRDC and the Respondent's objective was the investigation of falsified records which started by the orders to report (Exhibit R-55-1) in March 1995 and ended in the Tax Court on April 5, 2000.
[1188] The cumulative effect of all the evidence and pleadings of the parties convincingly show that the QMP scribblers were not intended to be a pay record for the purpose of recording the necessary information for insured persons under the Fishermen's Regulations.
[1189] The QMP scribblers of the Payor were intended for quality control of the fish processed by the Payor. The evidence did not show under what arrangement with DFO, the Payor kept the recordings. No evidence showed why the Minister concluded that the QMP scribblers were kept only for eels and bivalve molluscs and why the investigation only applied to fisherpersons who dealt with the above species.
[1190] If doubt was cast on the DFO slips because some fisherpersons admitted inflated amounts or false ROE's, what evidence did the Respondent have that this wrongdoing only concerned fisherpersons who sold eels or bivalve molluscs? Why would it not affect generally fisherpersons dealing with other species?
[1191] The Respondent's position was that other species were not required for QMP purposes. Where did he obtain that information in the Fishing Regulations? Is the Minister's position that since QMP recordings are not required for other species there would be no inflated DFO slips or false ROE's for those species?
[1192] So the decision of the Minister was since no QMP records existed for fisherpersons who sell flounder, mackerel, herring, smelts and lobsters, the Payor's records are adequate (no changes made to ROE's) and because the QMP records existed for bar clams, soft shell clams, quahaugs, eels and oysters these Payor's records are inadequate (Rulings made).
[1193] The evidence with respect to the QMP scribblers would show they were not destined for the registering of fisherpersons with payors for the purposes of the unemployment insurance plan.
[1194] QMP was for fish inspection and for exported fish. The QMP scribblers even under perfect recording habits could not contain then all deliveries of fish to a buyer because all the fish was not exported according to the evidence, unless the Court was not told about other arrangements made with the buyer and DFO, which the Respondent may have been aware of but was not conveyed to the Court.
[1195] Therefore if we do not know if all the deliveries of fish for all species were recorded in the scribblers, would it not be difficult to compare the entries in the QMP scribblers filed in the Court record with the DFO slips given to the fisherpersons in general and the Appellants in particular, for the fish they delivered?
[1196] Then if one adds to that the doubtful quality of the recordings as the accepted evidence showed, how could, under such circumstances, the QMP scribbler entries be reliable and serve to show that the DFO slips issued to the Appellants by the buyer were not accurate?
[1197] The QMP scribblers (Exhibits R-1 and R-2), as they are, cannot be considered as reliable documents for any valuable purpose in order to determine insurable earnings of the Appellants for unemployment insurance benefits and should have been set aside by the Rulings Officer and the Appeals Officer in these cases.
[1198] The Rulings Officer and the Appeals Officer should have acted in these cases as if the QMP scribblers had not existed.
[1199] The conclusion should have been as suggested by Lynn Loftus that if QMP records had not existed probably no changes would have been made to the existing records. The Respondent should have considered the QMP records of no value for the purpose of determining earnings and premiums, considered them as an investigative tool to carry out a proper inspection, audit and examination of the Payor's records and books of account as provided in section 59 of the Act and directed his energies towards the real responsible persons, and not proceed on the type of expedition that these hearings have demonstrated.
[1200] The appeal decisions, however, led to the Minister's assumptions in the Replies to the Notices of Appeal.
E- The assumptions of the Minister
[1201] The principal assumptions relied upon by the Respondent, in determining the insurable earnings and weeks of the Appellants, as outlined in the Replies to the Notices of Appeals which form the basis of the Minister's decisions are in part as follows:
l- The Payor, in order to maintain its licence, was required by the Department of Fisheries and Oceans (DFO) to maintain accurate Quality Management Program records (QMP scribblers) of all purchased products of the sea.
2- The QMP scribblers maintained by the Payor recorded the purchases made by the Payor from fisherpersons.
3- The Department of Fisheries and Oceans slips (DFO slips) issued to fisherpersons by the Payor for the purchases were not accurate.
4- The records of employment (ROE's) issued by the Payor to the fisherpersons were based on the DFO slips.
5- The Payor, paid for the purchases from the fisherpersons in cash.
[1202] The other allegations particular to each Appellant will be dealt with in the analysis of the individual fisherperson who has appealed.
The first allegation
[1203] The first allegation of the Respondent was "The Payor in order to maintain its licence, was required by the Department of Fisheries and Oceans (DFO) to maintain accurate Quality Management Program records (QMP scribblers) of all purchased products of the sea".
[1204] The evidence did not show what type of registration certificate was issued to the Payor when the Fish Inspection Regulations came into force on January 23, 1992.
[1205] The evidence however would indicate that the Payor would probably be in possession of some type of registration certificate as an operator of an establishment which met the requirements of QMP, in accordance with section 15 of the 1992 amendments.
[1206] Under this section the operator of an establishment in which fish is processed for export shall comply with several requirements as outlined in the Regulations.
[1207] The records to be kept by the Payor under the program were specified in paragraphs 15(2)(c) and 15(2)(d) of the Regulations.
[1208] The Payor was to keep and make available for inspection by an inspector for a period of not less than three years detailed records of the inspections and evaluations conducted or any actions taken, within the establishment, pursuant to its quality management program and keep up to date and make available to an inspector on request the information and documentation referred to in schedule VI.
[1209] Schedule VI outlines the requirements respecting QMP's (repealed on April 15, 1999, SOR/99-169).
[1210] The first section of this schedule outlines from paragraphs 1(a) to 1(h) what the QMP of an establishment shall keep as information and documentation.
[1211] Paragraph 1(a) stipulates that the name and title of the person responsible for the quality management program at that establishment bedetermined.
[1212] Paragraph 1(g) of Schedule VI stipulates that the establishment shall keep in respect of fish shipped from the establishment, a description of the system used to trace fish to their first destination.
[1213] Section 24.1 was added to the Regulations. This section stipulates that every person that exports fish from an establishment shall keep a record of the name and address of the person to whom and the date on which the fish is shipped from the establishment.
[1214] The evidence did not show if records existed for this specific information.
[1215] Section 17 of the Regulations indicates that the Minister may cancel the registration certificate issued in respect of an establishment where the establishment has serious contamination, is not in compliance with a requirement set out in Schedules I or II, the quality management program is not being complied with or does not meet the requirements set out in Schedule VI, any information or documentation referred to in Schedule VI is falsified or the records referred to in paragraph 15(2)(d) are falsified.
[1216] No evidence showed that the Minister of DFO would have cancelled the Payor's registration certificate or licence.
[1217] The QMP therefore provides for the keeping of detailed records of the inspections and evaluations conducted or actions taken within the establishment pursuant to its QMP.
[1218] No evidence was shown as to the existence of these records required under paragraph 15(2)(d).
[1219] As to the records required under paragraph 1(g) of Schedule VI in respect of fish shipped from the establishment, the description of the system used to trace fish to their first destination would appear to be what was filed in the Court records (Exhibits R-1 and R-2).
[1220] These records were the only evidence of a system to trace back certain species of fish: eels, soft shell clams, bar clams, quahaugs and oysters. No evidence was shown that a system was in place to trace back other species of fish which the Payor exported and shipped such as: flounder, herring, mackerel, smelts and lobsters (Exhibit R-22).
[1221] Section 24.1 of the Regulations does provide that for exporting fish from an establishment a person was obligated to keep a record of the name and address of the person to whom and the date on which the fish is shipped from the establishment.
[1222] This would therefore include every species of fish exported and shipped by the Payor.
[1223] Therefore it would follow that the Payor should have had a method in place to trace back every species of fish which was processed for export, unless DFO in the agreement entered into with the Payor on July 30, 1990 provided otherwise.
[1224] This document which was shown to the Rulings Officer was not seen by the Appeals Officer and not shown to the Court.
[1225] Adrian Doucette showed the agreement to Gary Robbins on September 20, 1995, and preferred not to release it because it was an original document.
[1226] This agreement detailed what procedures the Payor should follow and what records should be kept as far as QMP was concerned (Exhibit R-64, tab. 4, p. 4).
[1227] Could there be something in this agreement that did not require records for certain species?
[1228] Could there be something in this agreement that pertained to local sales within the province?
[1229] Gary Robbins and Lynn Loftus contradicted this first allegation of the Respondent. They maintained that QMP scribblers were not required for other species of fish other than those shown in Exhibits R-1 and R-2.
[1230] This evidence seemed also to be contrary to what Adrian Doucette had said to the Rulings Officer on September 20, 1995.
[1231] No reference is made in the QMP regulations in relation to fish that is not exported or shipped.
[1232] Fish purchased and sold locally was not recorded in the QMP which, according to the Regulations, was not required.
[1233] Therefore it was for all species of fish processed for export that the QMP was required.
[1234] The Payor, therefore from the reading of these Regulations, was required under the Law to maintain a description of the systems used to trace back all species of fish to their first destination in respect of all species of fish shipped from his establishment processed for export.
[1235] Did DFO agree to a different arrangement with the Payor? We do not know and probably never will.
[1236] The keeping of these QMP records and the records themselves were major allegations of fact relied upon by the Minister whom also invoked that if the Payor did not keep such records he could not maintain the registration certificate for processing or be out of business.
[1237] The fact that the Payor could lose his licence was a major element in the decision of Gary Robbins when he concluded that the QMP scribblers were accurate recordings of fisherpersons' deliveries.
[1238] No evidence showed that the Payor's registration certificate was revoked in 1992 or 1993.
[1239] What happened to this certificate when the Payor admitted, through his lawyer, to the falsification of the QMP records on January 3, 1996? The Court does not know. Did the Minister know?
[1240] When analyzing the evidence as a whole, the Minister's evidence and position before the Court was contrary to his own allegation.
[1241] The whole argument of the Respondent concerning the QMP records (Exhibits R-1 and R-2) is that they were accurate because the Payor had to maintain accurate QMP records (QMP scribblers) of all purchased products of the sea or face the possibility of loosing his licence.
[1242] According to the evidence, the Payor did not maintain QMP scribblers of all purchased products of the sea.
[1243] Since he did not maintain QMP scribblers for all species for export as required by Law (there was no evidence to the contrary) and no provision for local purchases and sales was provided in the Regulations (there is no evidence to the contrary) it follows that the Payor could not thus maintain total accurate records of fish purchased from all the fisherpersons he was dealing with.
[1244] This would appear to confirm the position of the Payor that he prepared his QMP entries from his shipping records because it was for the exporting of fish processed that QMP was required. What was purchased locally would then not appear in QMP. All this could possibly explain why the Rulings Officer said that the sales matched the Payor's shipping records.
[1245] This is one of the possible reasons why the Rulings Officer could not find the $93,000.00 discrepancy between the Payor's sales records and the Payor's purchases shown in the tax return discussed earlier.
[1246] It was surprising that the Respondent in the submissions made no single reference to these 1992 amendments, and the new definition of QMP and the record keeping requirements of the Payor which started this whole investigation and formed the basis of the Respondent's decisions.
[1247] This appeared very strange that no argument would emanate from the Minister who was using these records for a specific basis and purpose of determining insurable earnings.
[1248] This first allegation is thus refuted by the evidence.
The second allegation
[1249] This leads to the second allegation of the Minister which follows from the first where he states: "The QMP scribblers maintained by the Payor recorded the purchases made by the Payor from fisherpersons".
[1250] This is a very general allegation. The Respondent here, did not allege that the Payor recorded all the purchases. Why? Because as the evidence showed the Payor did not record all the purchases made. This was known to the Minister before he drafted his allegations. He knew or should have known that the Payor did not record all purchases because he did not record at least the purchases of flounder, herring, mackerel, smelts and lobsters.
[1251] The evidence also revealed that purchases for local sales were not recorded in the QMP scribblers.
[1252] The Court also notes that the Minister did not allege here that the Payor had recorded all the purchases made by the Appellants in particular.
[1253] He limited his allegation to fisherpersons generally. The evidence disclosed however that the Payor did record purchases made from fisherpersons but they were not done on a daily basis and according to the evidence accepted by the Court these recordings were falsified, incomplete and made under names of fishpersons who were not those who had actually sold to the Payor in certain instances.
[1254] This second allegation was refuted in analyzing the whole of the evidence.
The third allegation
[1255] The third main allegation of the Respondent was: "The Department of Fisheries and Oceans slips (DFO slips) issued to fish persons by the Payor for the purchases were not accurate".
[1256] Here again the Minister makes no reference to the Appellants in particular.
[1257] The Respondent based his decision as to the inaccuracy of the DFO slips mainly on the suspicion that some fishpersons had alleged inflated DFO slips.
[1258] Here, the Respondent did not allege inflated DFO slips, which was what he was suspecting.
[1259] No evidence showed that any of the Appellants had received inflated DFO slips which would have led to their inaccuracy.
[1260] This allegation was refuted as will be shown in the concluding analysis of each individual Appellant.
The fourth allegation
[1261] The fourth principal allegation was that the ROE's issued by the Payor to the fisherpersons were based on the DFO slips.
[1262] This general allegation was admitted as it is drafted and this is how the bookkeeper prepared the ROE's at the end of the fishing season in the case of those Appellants who received an ROE.
[1263] The Rulings and Appeals Officers never checked the DFO slips with the ROEs. They took for granted that a comparison of these two documents would show to be the same.
The fifth allegation
[1264] The fifth principal allegation was that the Payor paid for purchases in cash.
[1265] This allegation was admitted by the Appellants.
[1266] The Respondent would have preferred that the Payor pay by cheque in order to have a paper trail.
[1267] Nothing prevents a person from dealing in cash.
[1268] The Appellants explained how they were paid.
[1269] Generally speaking it appeared that the Appellants would have no choice and under such circumstances, if one needs to live, a payment of any sort would most likely be accepted.
[1270] This aspect again was the concern of the buyer and the Minister who no doubt has accepted this practice, from what was heard for years.
[1271] If a paper trail is required than some changes would have to be made to the legislation by Parliament.
[1272] Because the Appellants were paid in cash does not necessarily mean that the DFO slips they received were inflated or that their ROE's were incorrect.
F- Requirement of Appellants to keep records
[1273] The Minister did not allege that the Appellants were required under the Unemployment Insurance Act to keep detailed records of their sales with the buyer.
[1274] The Respondent, through the Appeals Officer, Lynn Loftus, seemed however to imply that fisherpersons because they are self-employed individuals, would have to keep these official records, DFO slips, for at least six years (p. 72 of the transcript of April 12, 1999).
[1275] The only reference to record keeping in the Fishermen's Regulations concerns the records to be kept by the employer.
[1276] The combination of section 77 of the Regulations and 58 of the Act clearly establish what records are to be kept by the employer. The reference to a period of six years by Lynn Loftus is an obligation of the employer well described in subsection 58(3) of the Act.
[1277] It may well be that for income tax purposes a self-employed person would be required to keep certain records of different sorts under the Income Tax Act.
[1278] Here, however, Parliament has made a specific provision in the Act for registering self-employed fisherpersons for unemployment insurance purposes.
[1279] May I take a moment to discuss two matters in relation to the Minister's position as to DFO slips and records to be kept by fisherpersons.
a) Is a DFO slip an official receipt?
[1280] First the Appeals Officer, Lynn Loftus, categorized the DFO slip as an official document (p. 72 of the transcript of April 12, 1999).
[1281] The Minister in the course of the hearing filed an admission prepared by DFO in relation to DFO slips (Exhibit R-70).
[1282] In this document DFO explains the purpose of the DFO slips specifically for gathering statistics of the amount of fish of a given species fished in a given area during a period of time.
[1283] DFO does not track DFO slip books, no record is maintained of the specific books given to a particular buyer.
[1284] DFO says that it is the responsibility of the buyer to accurately report on the DFO slips what they are purchasing from the fisherpersons.
[1285] DFO does not audit nor verify the information contained in the DFO slip.
[1286] Another document filed by the Respondent during the cross-examination of the Payor (Exhibit R-13) (p. 107 and foll. of the transcript of January 21, 1999) indicated what DFO required of the buyers and on the front page of this document we read as follows:
"Fisheries and Oceans
NOTICE TO BUYERS
All information asked for on the sales slip must be completed at the time the fish are delivered.
PLACE FISH LANDED Refers to common name of wharf, harbour, or community nearest to actual place landed.
CFV NUMBER For all purchases, the Commercial Fishing Vessel (CFV) number of the boat must be reported.
QUANTITY AND UNIT As some purchases will be measured in metric units while others will be in pounds, it is essential that the unit of measure be specified on the purchase slip.
UNLESS OTHER ARRANGEMENTS HAVE BEEN MADE IN WRITING FOR PICKUP BY LOCAL FISHERY OFFICERS, ALL COMPANIES ARE REQUIRED TO FORWARD SALES SLIPS ON A WEEKLY BASIS TO:
Dept. of Fisheries & Oceans
Statistics & EDP Division
P.O. BOX 5030
Moncton, N.B.
EIC 9B6
FAILURE TO COMPLETE OR FORWARD THESE SLIPS COULD RESULT IN PROSECUTION UNDER SECTION 48 OF THE FISHERIES ACT."
[1287] The Payor indicated that these books were picked up weekly or monthly by DFO.
[1288] From these documents one is led to understand that failure to complete and forward the DFO slip by the buyer of fish could result in prosecution and at the same time DFO testifies in the admission (Exhibit R-70) that the basic purpose of the DFO slip was to gather statistics. DFO in its admission did not say that the DFO slip was not an official receipt for fishpersons' deliveries of fish.
[1289] The Appellants, most of whom are experienced fisherpersons, testified that the DFO slips are and have been their only official receipts for fish sold and has been that way ever since they were fishing.
[1290] The pre-numbered books (Exhibit R-13) are sent back to Moncton and the admission states that no audit or verification is made of the information contained in a DFO slip and more importantly, DFO does not track DFO slip books and no record is maintained of the specific books given to a particular buyer.
[1291] How could a buyer ever be prosecuted if one did not know what numbered books he had or has something taken place that has wiped out the possibility of prosecution?
[1292] Curiously the Minister did not make a single argument of this issue.
[1293] The Court would think that if an offence was created by the failure of a buyer to adhere to the making and sending of DFO slips and is advised of this possibility, it must have been for a very serious purpose, one of which would be to prevent the Payor and any other persons dealing with him from cheating.
[1294] Would not one think that one way of monitoring, inspecting and auditing the Payor's books by the Respondent would be to make certain that each DFO book and slips were accounted for whether used or unused?
[1295] Did Lynn Loftus not immediately decide to go to Moncton to get the printouts (Exhibit R-64, tabs. 1 and 2). Was this not considered important information for the Minister?
[1296] If kept only for statistics one can maybe imagine why the Payor in this case had several books on the go at a time with little order in the sequence of numbers in many cases and would tend to show that DFO was not a very serious business. Any business that goes to the trouble of printing sequentially numbered documents is doing so for an effective accounting business purpose .
[1297] To read the admission (Exhibit 70) about the purpose of DFO slips was unbelievable and to blame the fisherpersons because some of their DFO slips were sequentially numbered on different days is not the fault of the fisherperson but those who have allowed the situation to reach such inefficiency and lack of rigour.
[1298] If DFO considers statistics more important than making sure that buyers are adhering to the proper completion of DFO slips, the Appellants still considered the DFO slip as an important document not for statistics but for their sales and so did the bookkeeper of the Payor for the unemployment insurance plan and the issuance of T4 slips to the Appellants for income tax purposes.
[1299] Also, the Respondent, when verifying this Payor's payroll books and records of account, could see for both years 1992 and 1993 that beside each fisherperson's name is the numbered DFO slip indicating the sales of the fisherpersons. Why would that information be there?
[1300] Could one not conclude that it was because it was a method used to indicate deliveries of fish by those fisherpersons who were registered with the buyer for the unemployment insurance plan and formed part of the books and records of account kept by the buyer as required by sections 77 of the Regulations and 58 of the Act.
[1301] What did it really represent? From what was said at the hearing it would be the record of the declaration made by the fisherpersons under subsection 82(1) of the Regulations which would seal the deal of sale between the buyer and the fisherpersons and make him or her eligible to be registered by the buyer for unemployment insurance benefits if he or she qualified in all other respects.
[1302] One must not forget that the DFO slip book was supplied to the buyers by DFO.
[1303] It was not a book that the Payor was allowed to order on his own from any other printer.
[1304] It was an official document delivered by DFO to every buyer of fish and the evidence showed it to be, even to this day, the official receipt by HRDC and the Respondent of anyone selling fish; it was not only for persons who sell their catches with the purpose of being insured in case unemployment should occur.
[1305] This was one of the necessary documents remitted to the bookkeeper to be used in the records pertaining to each fisherman for the purposes of the unemployment insurance plan
[1306] What seems to have happened over the years and been accepted by the Respondent is once the fisherperson has reached the required number of weeks for insurance purposes his other sales are shown on the Payor's T4 slips as earnings which the self-employed fisherperson reports in his income tax return.
[1307] The practice has also been for fisherpersons and buyers to decide whether a particular sale would be applied or not for unemployment insurance purposes.
[1308] This practice resulted in the expression used in the industry of "stamp" and "no stamp".
[1309] The Respondent has accepted this practice and as stated by Gary Robbins, a fisherperson could refuse a sale for unemployment insurance purposes.
[1310] One cannot conclude from such practice that the fisherperson is cheating. What it does mean is that the practice accepted by everyone over the years seems to have been to allow for fisherpersons to obtain their maximum number of weeks of earnings with the best sales in order to obtain the best possible benefits.
[1311] If this practice is unacceptable to the Minister, then the Regulations should be changed accordingly. Should there be any ambiguity in the interpretation of the Regulations, it must favour the individual.
[1312] What the Respondent was concerned about, as we see this investigation unfold, was the possibility of persons cheating the insurance plan. That was evidenced by a good part of the submissions of the Respondent and his witnesses.
[1313] But one must first, maybe, question the application on a day-to-day basis of the making and verification of the documents (DFO books and slips) that form the basis of what is insured for fisherpersons, as well as the inspection of the records of employers to ascertain that the record keeping is adequate for the purpose it was originally meant to be.
b) Requirement to maintain records
[1314] The second matter the Court wished to deal with was the Respondent's argument that since he did not accept the DFO slips of the Appellants, he required of them that they provide records of their own, over and above the receipts they had for their sales for insurable earnings.
[1315] The Respondent cited passages in the cases of Smith[13] Stanley[14] and Bernard[15] where Judge Margeson of this Court indicated that when the issue of insurable employment is raised by the Minister, there is a duty of every fisherperson to keep records of landings and the value of their catches.
[1316] In the context of the evidence before Judge Margeson, I do not interpret his remarks as meaning what the Rulings Officer and the Appeals Officer required of the Appellants in these appeals.
[1317] They required an almost identical "believable" set of records over and above the receipts they had and placed the burden of proof on the Appellants to show that the QMP scribbler entries, which the Payor claimed to have falsified, were incorrect. When the fisherpersons did supply receipts they were not accepted in several instances.
[1318] They required also from certain Appellants who claimed not to have fished or sold to the Payor, an alibi for them to prove they had not fished.
[1319] These appeals are governed by a very different set of facts, circumstances and employer record keeping, than what was encountered by my distinguished colleague Judge Margeson who did not say that fisherpersons were required, under sections 77 of the Regulations and 58 of the Act to keep books and records of account for earnings and premiums in relation to the unemployment insurance plan.
[1320] It is accepted that for income tax purposes, self-employed persons would have to provide expenses receipts and proof of their earnings from whatever source.
[1321] One must not forget that the verbal promise to sell accompanied by the delivery to and actual possession of the fish by the buyer is equivalent to a sale.
[1322] The DFO slip is the only official written or documentary evidence that confirms the fulfilment of the conditions of the verbal contract of sale or sales between the buyer and the fisherperson when the latter delivers his or her catch or catches.
[1323] This slip is the document used by the bookkeeper and the accountant of the Payor for record keeping. It may also be considered as the fisherperson's declaration required by subsection 82(1) of the Regulations for the insurance to take effect and for premiums to be paid and recorded.
[1324] It follows that failure to make the proper declaration with the required information carries, among other consequences, that of not being insured.
[1325] Therefore, the DFO slip or receipt is a valid authentic or official receipt of sale or sales which cannot be discarded or ignored without at least weighing what the buyer and the fisherperson had to say as to its making and its contents.
[1326] For the Minister to attempt to project, through the DFO admission (Exhibit R-70), that the DFO slip was only kept for statistical purposes was ignoring the legal definitions of what constitutes a sale or a promise of sale, the requirements of the Regulations and what had been for years accepted as the necessary documentation for fisherpersons.
[1327] However, the evidence showed that when someone, despite being in possession of DFO receipts, did present a diary and other documentation as an alternative, as required by the Respondent, it was not accepted as revealed in particular by the Appellant Myles Smith. This type of inconsistent approach was unbelievable and further reinforced the general mindset of the Respondent that he was in no possible way going to overrule the ruling decisions.
[1328] That was the end result to be reached by the Respondent, from what the Court heard.
[1329] It is too easy for the Minister, after so many years, to take the position he adopted especially when he knew that the fisherpersons were not the first responsible persons for bookkeeping according to the Regulations.
VII- Final general conclusions
[1330] The common investigation of HRDC and the Respondent as described by the evidence was not in keeping with the purpose or intention of the Act.
[1331] The decision to submit the fisherpersons to a common investigation and especially to order them to report and furnish information which could well concern third unnamed parties without the proper judicial authorization was contrary to Law.
[1332] The evidence showed that this order to report and the contents of the two-page document (Exhibit R-55-1) was not strictly an order to obtain information under subsection 46(1) for the fisherpersons to establish their claims for benefits. That was the appearance of what it might be, but it was clearly a common investigation of possible and probable criminal activity, the focus being the investigation of inflated DFO slips, the falsification of ROE's and the payor's record keeping. This investigation was more in line with subsection 94(13) and section 59 of the Act.
[1333] The fact that the Rulings Officer had withdrawn from the HRDC investigation to give the appearance of impartiality was unacceptable. To say that he withdrew was one thing but what actually occurred was another. The investigation was reactivated in September 1995 and continued until the beginning of 1996.
[1334] The evidence showed that the Rulings Officer knew before any fishperson was interviewed in February or March of 1995 that the files of fisherpersons would eventually be forwarded by HRDC to the Respondent for ruling decisions. This was the reason he attended the interviews long before any investigation of fisherpersons.
[1335] The evidence showed that the Rulings Officer and HRDC nonetheless carried out a common investigation until such a point in December of 1995 when it was attempted to make a deal with Dale Sharbell to submit him to paying a penalty or provide a truthful statement or face criminal prosecution, knowing full well that their investigation was not yet completed and no evidence showed that there was any penalty owing by anyone at this juncture.
[1336] The evidence showed that the investigation may have ended up by questioning the insurable earnings of fisherpersons but the purpose of the investigation by hearing and seeing all the witnesses and the documentation, was to uncover criminal activities such as inflated DFO slips, falsification of ROE's, or questionable accounting practices on the part of the Payor and the seeking from the Payor other documentation for unreported sales.
[1337] The evidence showed that the QMP scribblers was the investigative tool used by HRDC and the Respondent as the basis of the whole investigation and the Minister's decisions.
[1338] As a result of the interviews certain fisherpersons would allegedly have admitted some wrongdoing. None of these persons were identified or testified on that issue.
[1339] The evidence showed that once the Respondent and HRDC heard of inflated DFO and false ROE's and could not reconciliate the entries in the QMP scribblers with the DFO slips issued by the Payor and the Payor's sales and his income tax returns and before Dale Sharbell submitted to the threat of criminal prosecution on January 3, 1996, HRDC and the Rulings Division, in concert with each other, proceeded to rule on the fisherpersons in general without having resolved the difficulties encountered with the Payor's accounting in general and the QMP scribblers in particular. HRDC had not either advised the fisherpersons of the status of their claims for benefits for 1992 and 1993 because the common investigation was not terminated.
[1340] The actions of the Respondent in December of 1995 show to what extent and in what haste HRDC and the Rulings Division, moved to rule on the fisherpersons in general and the Appellants in particular. It reached the point that it was the Rulings Officer who was requesting the rulings documents (2216's) because he wanted to start his rulings after Christmas. By December 21, 1995, 107 letters were sent out to fisherpersons.
[1341] No thorough and meaningful investigation was carried out by HRDC as to the allegation of criminal activities related to inflated DFO slips or falsified ROE's. The threat of criminal prosecution of the Payor never materialized according to what the evidence showed.
[1342] No thorough study was made of the Fish Inspections Regulations and especially the new legislation in relation to QMP requirement of 1992 pertaining to record keeping. This matter was never pleaded by the Respondent either in the Replies to the Notices of Appeal or in the submissions made by counsel for the Respondent.
[1343] The Appeals Division failed to recognize the effect of a joint inquiry by HRDC and the Rulings Division.
[1344] The Appeals Division concentrated its efforts as did the Rulings Division on the QMP scribblers with the mind-set that all fisherpersons were party to some sort of scheme with the Payor.
[1345] The evidence showed that the Appeals Division failed to interview key witnesses, failed to look at all the Payor's pay records and concentrated its efforts by confirming the Rulings Officers' position as to the QMP scribblers before hearing any of the Appellants. It did not take the necessary time to conduct a thorough inspection, audit and examination of the Payor's pay records.
[1346] The Appeals Officer admitted that the position she took was as outlined in her Report to Head Office on May 30, 1996 (Exhibit R-64, Tab. 13, p. 6).
[1347] Since no further information regarding unreported sales was provided by the Payor, the purchases or deliveries described in the QMP scribblers were accepted by the Appeals Officer.
[1348] The evidence showed that the Appeals Division had decided in advance before interviewing any of the Appellants that the QMP scribblers were reliable for certain predetermined periods, knowing of the possibility that the QMP scribblers might not be correct, as stated by Dale Sharbell and corroborated by Martin Smith who was not interviewed by the Appeals Officer and who was the responsible person under the Law for the QMP entries in 1993 and the assistant to Dale Sharbell for 1992.
[1349] The evidence showed, even by the Respondent's own standards, that the QMP scribblers were not reliable, as no standard of accuracy was established. The reliability of the scribblers and the study of the Payor's books was not carried out according to any standards of professional accounting.
[1350] The evidence established that the opinion of the Minister in relation to section 80 of the Regulations was not particularly pleaded in the Replies to the Notices of Appeal although a reference is made to the numbered section 80. The first time this is mentioned is in the evidence at the hearing.
[1351] The opinion of the Minister was that the QMP scribblers of the Payor were reliable although these records were not maintained for the purpose of the unemployment insurance plan and never formed part of the Payor's records for unemployment insurance purposes and never sent to the bookkeeper or the accountant for record keeping of fisherpersons' sales in general and the Appellants' sales in particular.
[1352] The opinion of the Minister was made up by several influences, one of which emanating from the Department of Justice, that the QMP scribblers could be used in Court with proper handling of the case. No evidence or argument was provided by the Respondent as to the legal foundation of the opinion arrived at by the Minister and forwarded to the Respondent's headquarters on May 30, 1996.
[1353] The Appeals Division did not allow the several Appeals Officers to make their decisions on an individual basis. They had no objective choice but to follow the pre-determined opinion of the Respondent as to the value and weight to be given to the QMP scribblers when interviewing the Appellants and looking at their documentation. They did not estimate the earnings of the Appellants under section 80, they simply followed the reliability chart as prepared by the Rulings Officer and confirmed by Lynn Loftus of the Appeals Division.
[1354] The mindset of the Appeals Division even reached the hearing stage where it was first decided that only two Appeals Officers were to be heard. When one Appellant Kevin Robinson took the liberty of requesting the attendance of the Appeals Officer who had decided his case and was not present at the hearing, the Court was under the obligation of insisting that other Appeals Officers be made available. The Court, at this juncture, was told by counsel for the Respondent that it did not respect the wisdom of the latter, as if the Court was subjected to the dictates of the Respondent
[1355] No evidence whatsoever showed that any of Appellants had participated in or obtained inflated DFO slips or false ROE's or participated in manipulating the record keeping of the Payor.
[1356] No evidence showed that the bookkeeper in 1992 or the accountant Byron Murray in 1993 did not keep proper records as required under section 77 of the Regulations.
[1357] None of the Appellants who have testified to the best of their ability some six to seven years after the events, have been contradicted to any extent which could allow the Court to disbelieve any one of them.
[1358] The Respondent in the submissions has put forward many arguments as to alleged practices of illegal activity in relation to persons in receipt of unemployment insurance benefits and the over all record keeping practices of the Payor. No concrete evidence was shown to justify such submissions which were not pleaded particularly in the Respondent's Replies to the Notices of Appeal. These submissions, however, confirm what the whole purpose of HRDC and the Respondent's investigation was long before the lawyers were consulted.
[1359] To submit the Appellants to interviews, rulings, appeals and to the Tax Court in the particular circumstances of these appeals is not, in the respectful view of the Court, what Parliament intended.
[1360] A close reading of Parts III and IV of the Act allows for exceptional and effective powers both for HRDC and the Respondent to carry out their respective and separate duties in investigating those individuals who are clearly suspected of particular wrongdoing but not a combined umbrella investigation covering all fisherpersons who sold a certain species of fish to the Payor.
[1361] Clearly, Parliament did not intend to submit claimants and Payors to five of six years of anguish in solving issues of the nature heard before the Court when the Act and the Regulations provide for specific actions which should be explored fully at the first opportunity and directed towards the real responsible persons.
[1362] This Court cannot ignore what it hears and does not operate in a vacuum and, as it represents all the citizens, must underline the true spirit, intent and the meaning of the legislation to best ensure the attainment of its objects.
[1363] The submissions of counsel Allan Shaw, Regena Russell, Kathleen Craig and John Rhynes, of agents Catherine Sparks, Leroy Gamble and Jean Coughlin and of all the self-represented Appellants must be adopted by this Court.
[1364] However, the submissions of counsel for the Respondent Lynn Gillis and Marcel Prevost, who worked under very difficult circumstances, cannot be accepted.
[1365] This Court must conclude that the discretion exercised as pleaded in the Respondent's submissions was not carried out in accordance with what would be expected in applying the Act and the Regulations.
[1366] This Court, under such conditions, must also conclude that the main allegations of the Minister have been demolished and no other proven allegations could justify the Minister's decisions. The Court must intervene and decide each Appellant's case on an individual basis according to the accepted evidence as the circumstances and the consideration of fairness permit.
[1367] The appeals will be allowed and the decisions of the Minister are vacated in accordance with the analysis, these reasons and the final conclusions reached in the respective appeals of the Appellants.
VIII- Decisions as to individual Appellants
1. Donna Lewis
[1368] The Appellant, Donna Lewis, through counsel, in appeal No. 96-1638(UI), as to paragraph 8, admitted the allegations in subparagraphs a) to c), e), h) to j) and m). The allegations in subparagraphs d), f), g), k), l), o) and p) were denied and disproven by the evidence.
[1369] This witness was the first of Appellants to be heard in this case.
[1370] What she had to say as to how she delivered her fish, how she was paid, what took place at the Payor's premises could apply generally to most of the Appellants. Her evidence took close to two hours. For the comprehension of this witness's evidence, it is necessary to refer to Exhibits A-1, tabs. 1 to 15 (inclusively), 33, 34 and 37 to 40 (inclusively), A-2, A-5, R-1, tab. 5, p. 83, R-3, tab. 2, R-3-1-A, R-3-1-B, R-3-4 and R-3-7.
[1371] This person, mother of three and wife of Lloyd Lewis has been fishing for the last twelve years. She belongs to a family that has been fishing for several generations.
[1372] In 1992 and 1993, she fished soft shell clams and oysters in the Mill River area on the western part of Prince Edward Island (P.E.I.). She and her family fished from leased areas. The leases have been in the family under different names. In 1992 and 1993 the leases were in the names of Keith Lewis (father-in-law) and Lloyd Lewis (husband). The leasing department of the Federal Department of Fisheries and Oceans oversees these operations.
[1373] She delivered fish to the Payor in 1992 and 1993 on the dates which are shown on DFO slips. On July 17, 24, 31, August 8, 15, 21, 28 and September 3 of 1992. On June 19, 26 and August 6, 1993 (Exhibits A-1, tabs. 3 and 7).
[1374] When she delivered her fish she dealt with Jason Bulger and Dale Sharbell who was always present. Jason Bulger helped unload the product from the back of her truck at the first outbuilding beside the Payor's store, where the scales were situated.
[1375] Either Jason Bulger or Dale Sharbell weighed the fish product which she delivered in commercial white ice cream containers which had been purchased from an Esso station in Coleman, P.E.I.
[1376] Her average delivery was 313 pounds of fish. Her average weekly goal was to fill the ice cream containers since she knew the value of each container based on the price per pound.
[1377] After the fish product was weighed she was given an adding machine tape which indicated the number of pounds and the price per pound. This tape was given to her by either Jason Bulger or Dale Sharbell.
[1378] If the delivery was at the end of the week and it was the last delivery or if there was only one delivery that week, she would then proceed to the store to get paid.
[1379] If there was more than one delivery a week the adding machine tape would be kept by her till the last delivery of the week, when she was paid by Dale Sharbell, who prepared at the same time the DFO slip for all the deliveries made during the week. She considered the DFO slips as her receipts.
[1380] When asked why she was paid in cash she replied that "we were never offered any other option".
[1381] In 1992 and 1993, she also delivered fish to another Payor, Burleigh Brothers.
[1382] Her record of employment with the Payor in 1992 shows insurable earnings of $2,050.00 for a total of 8 weeks of insurable employment (Exhibit A-1, tab. 1). Her record of employment with the Payor for 1993, shows insurable earnings of $938.00 for a total of 3 weeks of insurable employment (Exhibit A-1, tab. 5).
[1383] The Payor's QMP records (scribblers) were shown to the witness. The page in the scribbler (Exhibit R-1, tab. 5, p. 83) entitled Donna Lewis would indicate deliveries of fish to the Payor in 1992 on 28 occasions between July 9 and September 4. No pages in the scribblers indicate any deliveries to the Payor by Donna Lewis in 1993 (Exhibit R-3).
[1384] However, the Appellant did show to the Court three DFO slips which would account for at least three deliveries of fish to the Payor in 1993 (Exhibit A-1, tab. 7). In 1992 as shown previously, the Appellant received 8 DFO slips from the Payor (Exhibit A-1, tab. 3). The witness affirmed that the only deliveries she made to the Payor in 1992 and 1993 were those described in her DFO slips (Exhibit A-1, tab. 3 and tab. 7). She produced a 1993 calendar that she kept at her home (Exhibit A-3). This calendar indicates deliveries of clams to the Payor on the 15, 16, 19 and 26 of June and 4 and 6 of August, 1993. It also shows deliveries of oysters which took place with another Payor on September 17 and 24, October 1, 8, 15, 22 and 29 of 1993.
[1385] This evidence of Donna Lewis would show that in 1993, she would have received a DFO slip on Friday, June 19, 1993, which included her three deliveries for the week, another DFO slip for a delivery on Friday, June 26, 1993 and a third DFO slip for a delivery on August 6, 1993.
[1386] In relation to fisherpersons' declarations she stated that she understood that it was "as simple as stating whose fish it is that you are delivering and what the species is and where it came from". The first time that she heard of actually having to make a written declaration was in 1993. When asked, what are you declaring? she replied: "You're declaring that you are the fisher who fished the product, delivered the product, how it was harvested or where it came from, and the equipment used in the harvest". She made verbal declarations since she began fishing in 1987 and began written declarations in 1993. These declarations were made either weekly, daily or on a seasonal basis depending on the buyer.
[1387] On March 13, 1995, the Appellant attended an interview with representatives of the Respondent and was informed that because her name did not appear in the Payor's scribblers for 1993, she was subsequently not granted any insurable weeks. She was told by Gary Robbins that the scribblers (Exhibits R-1 and R-2) were part of a Quality Management Program (QMP) carried out under the Fish Inspection Act.
[1388] As a result of the investigation, the Appellant made intensive inquiries, exchanged correspondence and obtained several documents which may be found in the Court record (Exhibit A-1, tabs. 9, 10, 11, 12, 13, 14, 15). All these documents were accepted as part of the efforts carried out by the witness in order for her to know what took place, what records were to be kept and ultimately what were the reasons for her being denied insurable weeks of employment as indicated to her in the Respondent's two rulings of August 2, 1996 (Exhibit R-3, tab. 2, pp. 1 and 18).
[1389] In cross-examination, the witness said that in 1992 and 1993, she did not sell to the Payor anything other that soft-shell clams. She used a boat to get to the area she fished. Her husband had clam leases and oyster leases. The clam leases were experimental and all the clams she sold to the Payor were taken off the leases and she did not fish on public grounds in 1992 or 1993.
[1390] She supplied her 1992 calendar to HRDC, but she did not supply it to the Rulings Officer of Revenue Canada.
[1391] She could not remember the number of deliveries she made to the Payor in 1992 or 1993. The deliveries were usually made once a week but when problems with poaching occurred, either in 1992 or 1993, the deliveries were made when the fishing was done and the quantity delivered justified the drive to the market.
[1392] The witness was questioned as to how it came about that she received the same amount of money on each delivery even when the price changed. She had previously stated that she had a goal to attain a certain quantity of fish. She said that it would have to be coincidence but that she could have delivered more than 313 pounds in a week.
[1393] She never received pocket change at the time of deliveries. The amounts were always rounded off. The Appellant admitted that 25% of her earnings were properly deducted by the Respondent from the total amount showing on her DFO slips for 1992.
[1394] She was paid when Dale Sharbell was present whether she delivered during or at the end of the week. The DFO slips show the week, the fish that was counted and the money paid.
[1395] She was interviewed by Revenue Canada at her home. She met with Lynn Loftus on March 13, 1996. She tape recorded the interview, the transcription of which was filed on March 12, 1999 (Exhibit A-5) during the cross-examination of Lynn Loftus, the Appeals Officer. This Exhibit was accepted into evidence and no facts were put forward to show that it should be excluded. Both parties to the conversation were aware that it was being recorded. At the hearing, Lynn Loftus had an opportunity to review the Exhibit and nothing before the Court could exclude this evidence from forming part of this judgment as if recited at length herein.
[1396] The Appeals Officer, Lynn Loftus, was heard on March 12, 1999.
[1397] In re-direct examination she said that she had no knowledge of the calendar which was filed by the Appellant (Exhibit A-2). She did not recall the Appellant saying anything about a calendar. She recalled the interview she had with the Appellant. She met at the Appellant's home. She found the Appellant aggressive and very intimidating. The Appellant had a lot of records, envelopes but was not able "to provide anything that showed proof that she had fished on particular days". The Appellant "was insisting that she had fished when her DFO slips had said that she had fished". The Appellant contacted the Appeals Officer many times.
[1398] Lynn Loftus was cross-examined. She mentioned that she interviewed Donna Lewis on March 13, 1996 and said that the Appellant was assertive, aggressive and passionate.
[1399] She remembered that the Appellant referred to a Clam Relay Report at her interview. The Appellant provided several pieces of documentation.
[1400] The Appeals Officer admitted that the position she took in May of 1996 when she produced her report was that outlined on page 6 of Exhibit R-64, tab. 13, where she writes:
"There has been no information regarding unreported sales provided by the buyer or his accountant, although ample time has been allowed. So the purchases have been accepted as shown on the QMP records."
[1401] This position was taken because time had run out. Dale Sharbell had ample time to provide additional unreported sales and even if they did exist she had not received them. She said that the QMP scribblers were used as Gospel at the rulings stage but not by her.
[1402] She stated that certain sales were not included in the QMP scribblers by the Payor. These would be fish used as bait, sales made over the counter, contaminated fish, fish sent to other plants for processing in P.E.I. such as French River Cannery and fish the buyers processed themselves. The QMP scribblers had to reflect the actual shipping records.
[1403] She said that it was her understanding at the time that the DFO records she received from the Department of Fisheries and Oceans in Moncton included over the counter sales of the Payor.
[1404] She said that she was told by Gilbert Nolan from DFO that purchases from other buyers is considered a secondary purchases and would not be shown on any purchase material for the Department of Fisheries and Oceans.
[1405] She said that sales by Sharbell's to French River Cannery a local buyer would not appear in the QMP scribblers according to Dale Sharbell.
[1406] The chart or formula that had been used by the Rulings Officer was used as a guideline when she did not have any additional records (p. 203 of transcript of March 12, 1999). She accepted to use the price of product indicated on the DFO slips as suggested to her by the Rulings Officer. Even if the DFO slip was not a credible piece of paper, according to Gary Robbins, it was not too likely that the price was inflated because according to him it was the quantities on the DFO that were inflated (p. 204 of transcript of March 12, 1999).
[1407] She admitted that she had not seen the statement of Martin Smith until after the determinations were made in the files of Janet W. Arsenault (July 30, 1996) and Donna Lewis (August 2, 1996). She did not feel it important. The statement of Martin Smith was faxed to her later by Lew Stevenson of the Commission. She knew that Martin Smith was a worker in the plant but also sold fish to the Payor. She was not aware that Martin Smith had something to do with the Quality Management Program. She thought Dale Sharbell was completing the records until she saw the statement of Martin Smith.
[1408] After she was made aware that Martin Smith had made a statement, she wanted to find out how heavily involved he was with the situation of the QMP scribblers. She had many questions for him. She actually looked for him and never found him. She did not interview Jason Bulger who also worked at the Payor's premises.
[1409] She said that she did not go to other buyers that were selling to Sharbell to find out what quantities of fish they were selling to the Payor. Two names of buyers had been given to her by Dale Sharbell. She did not check those other buyers because she wanted the information to come from the Payor. She wanted his records in order to be able to determine what his sales were.
[1410] In being questioned by the Court, she admitted not checking with any buyer to ascertain what amount of product they had sold to the Payor to build up his stock. She agreed that it would have been important to do so.
[1411] Lynn Loftus, the Appeals Officer was cross-examined in a subsequent occasion on April 16, 1999 by Mrs. Russell the lawyer for this Appellant.
[1412] She was questioned about a passage in her CPT 110 report of the Appellant for 1992 which was as follows at pages 112 and 113:
"Q. Okay, We're still at the CPT110, but it's for the 1992 year at the summary. It's the second last page, I believe or the third last page. The second paragraph of the summary, the second line states:
The records did not balance or agree when the DFO slips were compared to the payer's sales invoices, with the figures on the DFO slips being inflated. Some of the fishers interviewed in the case admitted that the DFO slips were inflated.
Why did you feel it necessary to refer to some of the fishers interviewed in this case admitting that the DFO slips were inflated? What has that got to do with your determination for Donna Lewis for that year?
A. That's part of the big picture. Some of the fishers admitted that the DFO slips were inflated, in other words, that their accuracy was called into question.
Q. But were Donna Lewis' DFO slips inflated when you were saying she fished 3,000 more pounds than she ought to have?
A. Not necessarily. I'm not referring to Donna Lewis on that sentence. I'm referring to what happened as a part of the whole in the case.
Q. So because some of the fishers interviewed in the case admitted that the DFO slips were inflated, was that going to lead you to believe something or was that -- what was that supposed to do to your investigation?
A. It led me to believe that the records were in question, that they weren't ---
Q. The records for those fishers who admitted?
A. No, for Mr. Dale Sharbell, the Fish Mart.
Q. What about Mr. Sharbell?
A. The Fish Mart records were in question.
Q. Did Donna Lewis ever admit that the DFO slips were inflated?
A. No.
Q. Did Janet W. Arsenault?
A. No. "
(pp. 112 and 113 of the transcript of April 16, 1999)
[1413] She said that the Appeals Officers did not have the 1992 ledger sheets of the Payor but that some of the files had copies of ledger sheets, but the actual 1992 ledger books she did not have. She had copies of the 1993 ledger books from the master file of Gary Robbins. She did not know whether she had a complete photocopy of the Payor's 1993 ledger. She assumed she had received a complete photocopy of the 1993 ledger. When she was then asked what she meant by "assume" and asked whether she had them or not she replied that she had photocopies of the ledger sheets. She did not know whether Gary Robbins got them himself or whether they came from HRDC. She admitted that she had never physically seen the original 1992 or 1993 payroll books.
[1414] The stamp of Lew Stevenson was not on every document she received.
[1415]She was then referred to Exhibit R-64, tab. 15, p. 1, where she indicated in her report that she was unable to do a comparison of oysters volumes of purchases and sales as the DFO statistic report she received from Moncton was in pounds and the QMP records were in pecks.
[1416] After lengthy cross-examination, she admitted that, despite all of the documentation the Appellant Donna Lewis provided to her, she did not believe this Appellant.
[1417] The Court requested from Lynn Loftus to inform the Court on her understanding of section 80 of the Fishermen's Regulations. She said that she considered the QMP records as being records for the purpose of establishing the earnings of the fishermen.
[1418] The Court referred the witness to the page of the QMP records under the name of Donna Lewis (Exhibit R-3, tab. 2, p. 17) and was questioned as follows:
"Q. Just a minute till I finish my question. Can you determine the insurable earnings of Donna Lewis there, the premiums payable by the employer, the dates on which they were payable, and when - or when the premiums were paid by that employer from that book?
A. Yes.
Q. How do you go about it?
A. On July the 9th, Donna Lewis delivered 27 pounds of clams at eighty cents per pound. So we've got the date, the delivery date. We've got the number of pounds and the price per pound, which will give you an amount.
Q. Do you have her premiums payable there?
A. No, but that would have to be determined.
Q. Do you have the date on which they are payable?
A. They would be payable on the 15th of the following month.
Q. We have the date there, though, in that book? No?
A. No.
Q. Do you have the date when the premiums were paid by the employer?
A. Not on that book, no. "
(p. 144 of the transcript of April 16, 1999)
[1419] The Appeals Officer did not say whether she would have advised Head Office of the statement of Martin Smith which corroborated what Dale Sharbell had stated as to the way the QMP scribblers were not prepared daily or accurately.
[1420] The Appeals Officer did not estimate the Appellant's earnings according to section 80 of the Regulations. She simply decided what the earnings were according to what was written in the QMP scribblers.
[1421] The Appellant's evidence was truthful acceptable and uncontradicted and nothing showed that she would have participated in any way in falsifying either her DFO slips or records of employment in order to be eligible for unemployment insurance benefits and the QMP scribbler could not be relied upon for her deliveries to the Payor in 1992 or 1993.
[1422] No evidence showed that the Appellant gave false statements in applying for unemployment insurance benefits.
[1423] The arguments and submissions of Counsel Regena Kaye Russell must be accepted and followed by this Court as if recited at length herein in this appeal in particular and the appeals in general.
[1424] The Appellant has established by a preponderance of evidence that her insurable earnings are those described in her records of employment issued for 1992 and 1993 by the bookkeeper or accountant according to the records kept under section 77 of the Regulations.
[1425] This appeal must be allowed.
2. Lloyd Lewis
[1426] The Appellant, Lloyd Lewis, through counsel, in appeal No. 96-2100(UI), as to paragraph 10, admitted the allegations in subparagraphs a) to c), e) and h) to k). The allegations in subparagraphs d), f), g) and l) were denied and disproven by the evidence.
[1427] This witness is the spouse of Donna Lewis. For the comprehension of his evidence we must refer to Exhibits A-1, tab.16 to 23, 34, 37, 38, 41 and 43, R-3, tab. 3, R-3-1-c, R-3-6, R-3-7. He stated that his record of employment for 1993 was accurate. He made one delivery to the Payor in 1993. The entries in the Payor's scribblers did not mean anything to him. He never made the deliveries outlined in the Payor's scribblers. He explained his activities. The only receipt he had for his delivery to the Payor was his DFO slip. He did not record what monies he took home. He did not make enough money to make deposits at the bank. He received no cash advances from the Payor. The Payor's books were no concern of this witness.
[1428] The Appeals Officer, Rosemarie Ford, was heard in this appeal on April 16, 1999.
[1429] She said that she had called Lew Stevenson of HRDC to see if the Appellant was drawing unemployment insurance benefits in June of 1993. The reason was to find out if the Appellant had any income in June of 1993. If the Appellant was not drawing benefits or not fishing according to his ROE she was wondering what he was living on. She was informed by HRDC that the Appellant was not drawing benefits in June. The Appeals Officer gave him one week where he had actually stated that he had fished and delivered his product. She gave him four extra weeks because the QMP scribblers were considered reliable during that time period and she believed he had fished and possibly sold for cash.
[1430] She said that her understanding of the QMP program was that the name of the fisherperson was not required.
[1431] She had no additional information in the file of the Appellant except what she received from the Rulings Officer.
[1432] She did not recall seeing the 1992 payroll ledger sheets in any files. The first time she saw payroll books for 1992 was when Dale Sharbell brought them to Court at this hearing.
[1433] She was asked to file Exhibits A-6 and A-7. She recognized the stamp which is shown on the Exhibits. She did not believe there was a stamp on every document she received. She agreed that the 1992 payroll ledger sheets were available to Revenue Canada in the investigation for the files of Donna Lewis and Janet W. Arsenault at least.
[1434] She did not know what a crop rotation involved and did not ask questions to the Appellant about it. She did say that fishers had work to do on their leases or be busy during certain periods of the year on their leases. She did not interview Martin Smith or Jason Bulger. She said that a few fishermen had told her that Jason Bulger would have been in the fish plant when they delivered their fish.
[1435] She said that she had requested a record of employment of a fisherman and received unexpectedly the statement of Martin Smith in August or September of 1996 after she had started making determinations in the appeals (p. 70 of the transcript of April 16, 1999).
[1436] She did not recall having access to the report of Lynn Loftus which may be found in Exhibit R-64, tab. 15, p. 1. She did say however that there would be another report that was prepared by Lynn Loftus that she did have access to (p. 72 of the transcript of April 16, 1999).
[1437] She did not prepare anything in Exhibit R-64. Counsel for the Respondent then indicated that she might want to turn to Exhibit R-64, tab. 11, p. 11. The witness was then asked to look at Exhibit R-64, tab. 11, p. 11 and compare oysters poundage of 122,554 with the information provided in Exhibit R-64, tab. 15, p. 1. She was asked whether she was given any information throughout the course of her investigation concerning the accuracy of the quantities of oysters. She replied that she was given information gathered by Lynn Loftus and the Rulings Division
[1438] She said that she was aware that Lynn Loftus was unable to do a comparison of oysters volumes of purchases and sales as the DFO statistics report was in "pounds" and the QMP records were in "pecks". She did not know where the 122,554 figure came from. She did not know why pounds were listed if no comparison was possible to be made. She did not know because she did not prepare any of the documents in Exhibit R-64. She did not look at DFO statistics.
[1439] The Appeals Officer did not estimate the Appellant's earnings in accordance with section 80 of the Regulations.
[1440] This Appellant was not contradicted. His evidence was truthful and nothing was shown that he would have participated in anyway in falsifying either his DFO slip or record of employment or giving false statements in order to be eligible for unemployment insurance benefits and the QMP scribbler could not be relied upon for his delivery in 1993.
[1441] The Appellant has established by a preponderance of evidence that his insurable earnings are those described in his ROE issued for 1993 by the accountant according to the records kept under section 77 of the Regulations.
[1442] This appeal must be allowed.
3. Janet W. Arsenault
[1443] The Appellant, Janet W. Arsenault, through counsel, in appeal No. 96-1905(UI), as to paragraph 5, admitted the allegations in subparagraphs a) to c), e) and h) to l). The allegations in subparagraphs d), f) and g) and paragraphs 7 and 8 were denied and disproven by the evidence.
[1444] For the comprehension of this witness's evidence we must refer to Exhibits A-1, tabs. 24, 34 and A-6, R-3, tab. 1, R-3-1, R-3-2, R-3-5, R-3-7.
[1445] This person testified on the 21st of January 1999. She harvested shellfish in 1992 and 1993 and sold to the Payor. She delivered Iris Moss to another Payor.
[1446] She identified her DFO slips which she received at the end of the week at the time of delivery from the Payor. She had her catch weighed by Jason Bulger. Martin Smith and Dale Sharbell were also there.
[1447] She fished all week as long as the weather permitted her to dig for clams. She was told by Revenue Canada that she had not fished certain weeks.
[1448] She lost five weeks of insurable earnings in 1993 and the amount of her insurable earnings was reduced for 1992. She was told that she had not fished the quantity of fish that was indicated on her DFO slips.
[1449] Basically her DFO slips did not match the entries in the Payor's QMP scribbler (Exhibit A-1, tabs. 30 and 31). She had never seen the scribblers until her interview on June 8, 1995.
[1450] She stated that the Payor's scribblers are inaccurate because she delivered only once a week.
[1451] In cross-examination, she stated she required ten weeks of work in each of the 1992 and 1993 years to qualify for unemployment insurance benefits.
[1452] She can control the number of weeks she works depending on whether she could obtain the services of a babysitter.
[1453] She could not remember whether she could have worked more than 10 weeks in 1992 or 1993.
[1454] She knew her DFO slips were accurate because she sold her fish and was present when the DFO slips were made out. She did not keep the small pieces of paper she was given at the scales.
[1455] She explained the process of fishing and delivering her fish. She did not know how many crates of clams would fit into the truck she used to go to the Payor. She also said that she used buckets at times. Apart from her ROE's and DFO slips she filed a letter and a copy of a calendar for July, August and September 1993 (Exhibit A-3). This document indicated the days where she fished in 1993. She explained the notations she made on her calendar. When she returned home with her DFO slip she would mark it on the calendar. She could not find any similar documents for 1992.
[1456] She paid her unemployment insurance premiums but she kept no personal record of what she had paid. She was paid in cash by the Payor. She never saw a little ledger book at the Payor's premises. Her DFO slips were her receipts.
[1457] She was asked where she got money to live when she stopped working? She explained that it was set aside and she made sure she paid her bills and could carry herself through, but that was not the reason she stopped working.
[1458] On March 12, 1999, the Respondent filed the reports of Lynn Loftus, the Appeals Officer, for the 1992 and 1993 years respectively for Janet W. Arsenault (Exhibits R-3-1 and R-3-2), Donna Lewis (Exhibits R-31-a and R-31-b) and Lloyd Lewis (Exhibit R-3-1-c).
[1459] The reports called "CPT 110's" were filed by consent as if recited at length at the hearing in so far as each report was applicable.
[1460] Counsel for the Appellant Janet W. Arsenault, stated that only the 1993 year was in dispute. The Respondent however wished to file the reports for both the 1992 and 1993 years since both years were appealed. After some discussions (pp. 174 and 175 of the transcript of March 12, 1999) Mrs. Russell informed the Court that the 1992 year was not questioned and both parties agreed to forget the 1992 year in the case of Janet W. Arsenault.
[1461] The Appeals Officer, Lynn Loftus, was heard on March 12, 1999.
[1462] In direct-examination, she said that she did not visit with this Appellant and relied on the information in the unemployment insurance application and the response to the questionnaire. Janet W. Arsenault did not provide her with any additional information.
[1463] In cross-examination, she admitted that for the year 1992, verbal declarations to the buyers by fishers were accepted by the Appeals Officer.
[1464] She could not recall whether she received a copy of a calendar from the Appellant showing the dates her fish was delivered in 1993. She said if there had been one, she would have put it in the file.
[1465] The Appeals Officer, Lynn Loftus was also cross-examined on April 16, 1999 by Mrs. Russell who also acted for two other Appellants, Donna Lewis and Lloyd Lewis. What was said generally in those last two cases would be applicable in the case of this Appellant.
[1466] This Appellant was not contradicted, her evidence was truthful and nothing was shown that she would have participated in any manner in falsifying her ROE or DFO slip or giving false statements in order to be eligible for unemployment insurance benefits and the QMP scribblers could not be relied upon for her sales to the Payor in 1992 or 1993.
[1467] The Appellant has established by a preponderance of evidence that her insurable earnings are those described in her records of employment issued for 1992 and 1993 by the bookkeeper or accountant according to the records kept under section 77 of the Regulations.
[1468] This appeal must be allowed.
4. Eliza Clements
[1469] The Appellant, Eliza Clements, through counsel, in appeal No. 96-1741(UI), as to paragraph 6, admitted the allegations in subparagraphs a) to c), e) and j). The allegations in subparagraphs d), f) to i) and k) were denied and disproven by the evidence.
[1470] For the comprehension of the evidence of this witness, we must refer to Exhibits B-1, B-1-1 to B-1-3 and R-4, tab. 3.
[1471] This witness was heard on January 22, 1999. She is sixty nine years of age. She was interviewed by HRDC on March 28, 1995. She identified her signature on fisherperson's declarations (Exhibit B-1, tab.5). She does not drive a car. When she delivered her catch to the Payor in 1993, she was driven by her daughters. She would pay her daughters by buying gas for them. She produced her gas receipts (Exhibit B-1, tab. 5) to the Appeals Officer.
[1472] In cross-examination, she said that her daughters would drive her to the Payor's plant where she sold her clams. She paid for their gas on those occasions. In 1993, she also worked at Polar's factory for six weeks. She could not recall how many times she delivered clams in 1993. She fished more than once a week. She delivered her clams every day she fished. She was paid in cash. She also sold moss to Acadian Seaplants. She described how she fished and delivered her product.
[1473] The daughter of the Appellant, Sally Doucette, was heard. She confirmed seeing her mother sign a declaration at the Payor's premises, and also confirmed driving her mother to the Payor and having gasoline put in her car.
[1474] She was cross-examined. She could not remember how many buckets of clams she could fish in a day. She fished clams for one week. She also worked at Polar Fisheries and at picking moss. She kept her mother's DFO slips, her gasoline bills and every paper she would receive. She did not keep the slips of paper that her mother was given at the Payor's scales when the fish was weighed. She did not keep track of the days she or her mother worked.
[1475] The Appeals Officer, Lynn Loftus, was heard in this appeal on April 6, 1999 (p. 75 of the transcript). She was referred to her report to Head Office dated May 30, 1996 (Exhibit R-64, tab. 13, p. 5).
[1476] The interview of this Appellant was conducted by mail.
[1477] The Appeals Officer never spoke to Martin Smith. The Appellant's fisherman's declarations and DFO slips were all prepared by Martin Smith (Exhibit B-1, tab. 5).
[1478] The attention of the witness was drawn to the second paragraph of the summary of her report (Exhibit B-1, tab. 6, p. 6).
[1479] She was asked whether the product delivered by this Appellant was too much product to be transported or that she was unable to lift the product. She replied there was a question about what the Appellant's abilities were because she was receiving Canada Pension benefits and it was not survivor benefits. The Appellant had also left blank the last part of the questionnaire dealing with additional comments. She admitted when questioned by the Court that she had no evidence that this Appellant was disabled.
[1480] She admitted that the Appellant's name was not in the QMP scribbler and that was the reason for her being in appeal. The fact that the Appellant provided receipts that she bought gas when she sold to the Payor was not enough evidence that she had fished.
[1481] She was then asked if she had contacted either Martin Smith or the Appellant to obtain more information. She was asked to read part of what Martin Smith had told the Court about Eliza Clements when she delivered her catches to the Payor. She replied that she did not know if she would have received more information about the Appellant if she had contacted Martin Smith but that she probably would have had more information as well if she had talked to Mrs. Clements (the Appellant).
[1482] The Appellant's counsel suggested to the Appeals Officer that this Appellant could not have done much more to refute the position taken by the Respondent. The Appeals Officer suggested that she could have if there had been other records or had the Appellant provided other records such as a journal showing what her income was, what her expenses were. If she had provided a detailed diary some consideration would have been given to it.
[1483] In re-direct examination, she said that she relied on the printouts (Exhibit R-64, tabs. 1 and 2) because the date from the printouts was from the DFO slips which were collected from the Payor and that Sharbell was not able to provide a copy of all the DFO slips.
[1484] She also said that she did not look at the payroll records for 1992 and 1993 as a whole and she did not have the 1992 payroll records. She did not know what the sales tapes indicated. She specified that Dale Sharbell had told her that at the end of the week, an envelope was sent to the accountant with the tapes showing the purchases and sales. She had no idea what the tapes were made up from. She was not sure whether she could have reconstructed them from the information that was provided to her. When asked whether the tapes would have helped her? She replied, that she would have given them some consideration. Both, Dale Sharbell and the accountant had told her that the tapes were not returned.
[1485] She was also asked by counsel for the Respondent if the QMP scribblers had not existed for anything what would have happened to these Appellants? She replied that probably the existing records would have been let stand (as was done for fishers who had species not covered for QMP). She said that she did not rely on the DFO slips "because there was doubt cast upon them. There was people who had admitted that they had been issued falsely. They weren't agreeing with the records that they should have agreed with. There were many reasons why the DFO weren't considered. They were considered where the QMP records did not agree." She also said that if DFO slips and QMP scribbler were not used, the other option was that "we could have denied everything".
[1486] When questioned by the Court she admitted that she did not have the pay records of the Payor for 1992. She took for granted that the Payor had given to her all his books. She found Dale Sharbell to be very cooperative, but she admitted that he had not given her all his books.
[1487] She admitted that nothing was done to carry out a search of the Payor's premises and obtain whatever documents might be missing. She said that the payroll books for 1993 were in each Appellant's individual file.
[1488] The Court asked her when she saw the records for 1993 whether that did not make her think about the 1992 pay records? She said that the information in the pay records was prepared from the DFO slips and the doubt had already been cast on the DFO slips.
[1489] She had already decided that the DFO slips were inaccurate as the payroll records were made up with the DFO slips, they were not considered to be accurate and she was not going to rely on them (p. 109 of the transcript of April 6, 1999).
[1490] She acknowledged that the Appellants had no control over the payroll books and had no input on them. She also said that the only way the Appellants would know that the payroll books were being made up properly was when they would receive their T4 slip or their ROE, and if the records were incorrect, they would have to go back and have them corrected. (pp. 108 to 110 of the transcript of April 6, 1999)
[1491] Eliza Clements was not contradicted and no evidence indicated that she would have participated in falsifying her record of employment or her DFO slips or participated in making false statements in relation to any claim for unemployment insurance benefits. This Appellant was a truthful witness. The QMP scribblers could not be relied upon for any purpose in this appeal.
[1492] The Appellant has established by a preponderance of evidence that her insurable earnings are those described in her record of employment issued for 1993 by the accountant according to the records kept under section 77 of the Regulations.
[1493] This appeal must be allowed.
5. Allan McInnis
[1494] The Appellant Allan McInnis, through counsel, in appeal No. 96-1742(UI), as to paragraph 6, admitted the allegations in subparagraphs a) to c), h), i) and k). The allegations in subparagraphs d) to g), j) and l) were denied and disproven by the evidence.
[1495] For the comprehension of this witness's evidence, we must refer to Exhibits B-2, B-2-1, B-2-2 and R-6, tab. 11.
[1496] In 1993, he worked for Sidney Gavin as a fisherman in the snow crab industry.
[1497] He was interviewed by HRDC on July 4, 1995. He explained to the Court the heated discussion he had with Joe Pierce an investigator of HRDC. He explained to the officer that he fished and sold eels to the Payor in 1992 and reported those sales on his unemployment insurance cards. This, the officer confirmed with the Appellant.
[1498] In 1993, he did not sell eels to the Payor. He was shown a copy of the QMP scribblers that reported deliveries to the Payor under his name. He told the investigator that there is more than one person by the name of Allan McInnis. He pointed out to the officer that usually when you sell fish you usually have to give to the buyer your social insurance number. These was no indication of that kind on the page of the QMP scribblers under his name. He was refused a copy of the QMP scribblers at this interview.
[1499] He received a letter on December 18, 1995 (Exhibit B-2, tab. 4) with a questionnaire from the Rulings Officer of Revenue Canada. He gave the same answers he had previously given to HRDC.
[1500] He fished eels privately in the spring of 1993, in May or June. He makes a sort of pickled fish product. He fished eels in the evening and at night, contrary to what was assumed by the Appeals Officer in her report that the Appellant obtained through the Privacy Act. He also noted that, as the Appeals Officer required, it would be difficult for him to provide records in 1996, that he did not sell to the Payor in 1993.
[1501] In cross-examination, he said that he fished in 1993 for Sidney Gavin, between May 10 to July 17, 1993. In the spring, he also fished on his own.
[1502] After terminating his employment for Sidney Gavin in July 1993, he applied for unemployment insurance benefits. He worked on his oyster lease, around home and took care of his mother's property. He did not fish eels after July of 1993. He sold eels privately to individuals and not to fish buyers and that is the reason he received no DFO slip for those private sales.
[1503] He explained that if you sold fish to a buyer he would prepare a DFO slip even for small amounts. He agreed with what he said in his statement (Exhibit B-2, tab. 3). When he sold eels in 1993, he was not drawing unemployment insurance benefits.
[1504] The sales would have taken place in May or June.
[1505] He explained how people live in his area and how he freezes certain species of fish for the winter season. He did not sell eels privately throughout the year, but, what he sold he reported on his income tax return. He did not know what amount of money he made selling eels in 1993. He also said that he may have sold a few flounders and blackbacks in 1993.
[1506] He was asked whether he reported a gross fishing income in 1993 of $5,730.00. He replied that he must have reported that amount but that he has an accountant that prepares his income tax return. A printout of his income tax return for 1993 was filed (Exhibit R-14).
[1507] He knew basically how much product he had sold and he imagined that he kept a record of his expenses in order to inform his accountant to prepare his income tax return. He did not classify his fishing as a business . He said that he recorded the amount of money he took from individuals and the total amount he gave to his accountant for Revenue Canada. He explained what a rebate was in the lobster industry but received no rebates from the Payor.
[1508] The Appeals Officer, Lynn Loftus, was heard in this appeal on April 6, 1999. She prepared her report on August 27, 1996.
[1509] The witness was referred to the summary of her report and the questionnaire of the Appellant. The Appeals Officer noted in her report that this Appellant had denied selling eels to the Payor in 1993. She was asked if she checked the answers given by the Appellant in his questionnaire to verify whether they were true, since the Appellant had said that he had sold to the Payor in 1992 and although he fished eels in 1993, he had not sold any to the Payor in that year. The Appeals Officer could not recall whether she had or not. In any event the 1992 year was not under appeal. She could not recall whether she saw any statement signed by the Appellant.
[1510] She admitted that in her report she made reference to the Appellant fishing lobsters. Under cross-examination she admitted that there was no basis for that conclusion. She admitted that she incorrectly indicated in her notes that this Appellant had stated in his interview with HRDC that he did not fish eels in 1993.
[1511] She was referred to the QMP scribbler page in the name of Allan McInnis (Exhibit R-6, tab. 11, p. 9). She said that in examining the page, there is no address, no phone number, no social insurance number. She admitted that if that page was the only document shown to her, she would ask for more information.
[1512] She admitted that after she received the questionnaire from the Appellant she had doubts as to the Appellant's fishing for 1993. She said that she attempted to contact him on several occasions but could not reach him. She did not send out another questionnaire to obtain further information to clear up the doubts she had. She also said that she was under a lot of pressure from fishermen and others to send out the determinations. She did say that she was given no time limit to decide her cases and that there was nothing to prevent her from sending out another questionnaire. She also said that she had problems reaching by phone other Appellants she dealt with.
[1513] In being questioned by the Court, she said that no premiums were taken from this Appellant. She also said that she would have checked the computer to see whether the premiums for 1992 and 1993 were paid by the Payor but she did not think she had recorded it anywhere. She said that when she determines that the Payor's books are not accurate the calculation of premiums is done by another section in her department. She admitted that she did no check the payroll books for 1993 to see the earnings given to the worker and the unemployment insurance premiums that were supposed to be paid. She said that the payroll book for 1993 was not in Court. What was in Court were pages of a pay record for each individual Appellant.
[1514] She also said that she did not look at the payroll book to start her investigation (Exhibit R-8, tab. 4, pp. 1 to 20).
[1515] She did not start her investigation with the Payor's payroll record because when she looked at the whole thing first, she was looking at each individual file. She was looking at the individuals rather than at the buyer. She was not looking at section 80 when she started. She was asked that since she was allocating earnings or doing the appeals of ruling decisions of each individual Appellant why would she not start by looking at the payroll book? She replied that she did not do that because the payroll book had doubt cast on it because it was prepared from the DFO's.
[1516] She also said that there was no real regard to the payroll book, it was used as just another review process. She said that there were things found in the payroll book but did not specify further. Having doubt cast on the 1993 payroll book was probably the reason why she did not try to obtain the 1992 payroll book.
[1517] The Appellant was truthful and nothing in his evidence could lead to conclude that he sold any fish product to the Payor in 1993. This Appellant was not contradicted and nothing was shown that he would have participated in any way in falsifying records of any kind. The QMP scribbler could not be relied upon for any purpose in this case.
[1518] This Appellant having no sales with the payor in 1993 did not receive a DFO slip or an ROE and could not be registered by the Payor in the insurance plan under such conditions.
[1519] If he had made sales as the Respondent suggests, he would not be an insured person under the Regulations for 1993.
[1520] The Appeals Officer did not properly apply section 80 because the Appellant was not an insured person, having made no declaration to the buyer and was not recorded in the records kept by the Payor's accountant under section 77 of the Regulations.
[1521] This case is a demonstration of the effects of the common investigation of HRDC and the Respondent.
[1522] What the Appeals Officer was doing here in essence was creating an insured person for 1993 because the Appellant had sold to the Payor in 1992.
[1523] This case was an example for the proposition that these appeals were a part of the investigation process which began with the common investigation of HRDC and the Respondent in early 1995.
[1524] The appeal will be allowed.
6. Carl Lewis
[1525] This Appellant testified on January 22, 1999. The Appellant, Carl Lewis, through counsel, in appeal No. 97-626(UI), as to paragraph 7, admitted the allegations in subparagraphs a) to c), e), h) to j) and m). The allegation in subparagraph l) was admitted with further explanations to be given at the hearing. The allegations in subparagraphs d), f), g), k), n) and o) were denied and disproven by the evidence.
[1526] The Exhibits relating to this Appellant are B-15, B-15-1, B-15-2, B-15-3 and R-5, tab. 6.
[1527] He explained how he delivered his catches to the Payor. When his catch was weighed, he received a slip of paper, then entered the store and got paid.
[1528] In 1993, he delivered clams and eels to the Payor and oysters to another buyer, Leslie Hardy. He was sick in the spring of both, the 1992 and 1993 years.
[1529] In 1992, he sold clams, soft shell clams and eels, to the Payor. He was interviewed by Lew Stevenson of HRDC on March 14, 1995. He advised the investigator that his DFO slips and records of employment were correct. He netted eels at night and on Sundays. He received no advances from the Payor.
[1530] For the 1992 year, the Minister disallowed the single week of September 19, 1992 for a delivery of oysters. The Appellant had a DFO slip for that week No. E377424, (Exhibit B-15, tab. 7, p. 26). He could not recall the actual delivery because of the time lapse since 1992.
[1531] He explained how he netted eels and kept his clams. He would make one delivery per week of eels and of clams. In 1992, he never signed a fisherman's declaration. In 1993, he signed a fisherman's declaration for soft shell clams (Exhibit B-15-1), but he believed, that for eels, he did not have to sign a declaration. He would receive his DFO slip at the end of the week. He did not know for what reason his DFO slips and those of his mother Betty Lewis were consecutively numbered. He had no participation in the making of the DFO slips. He provided all his DFO slips to the Respondent and declared all the monies described therein in his income tax returns of 1992 and 1993. Throughout his 15-16 years as a fisherman he only received DFO slips that he treated as official receipts.
[1532] In cross-examination, he reiterated how he could work for Wilkies' and fish at the same time in 1992. In 1993, he dug clams one week in July, fished oysters and eels by himself. He fished more oysters in 1993 than eels. In 1992, he fished a lot of shellfish and also worked at Wilkie Farms. When he delivered his catches sometimes his brother, mother, wife or his children could be with him. On one occasion he was with Allan McInnis.
[1533] His mother could have delivered at the same time as he did. He never delivered anyone else's fish.
[1534] He would receive a DFO slip at every delivery because he delivered mostly once a week. He was referred to the last page of Exhibit B-15, tab. 7, p. 29, where three DFO slips dated October 2, October 9 and October 16, 1993 are consecutively numbered B362115, B362116 and B362117 respectively.
[1535] He could not explain why three DFO slips would be consecutively numbered on three different dates. He stated that he could not recall ever receiving more than one DFO slip at a time. He said "I can't say I did or I didn't". He could not recall, it being quite a few years ago.
[1536] He could have been present when his mother received her DFO slips at the time of delivery, but could not recall whether his mother had received more than one DFO slip at a time.
[1537] He said that he could not have been fishing in July and August, because he was sick. He said he believed, he needed 10 weeks to qualify for benefits in 1993, which was when he worked for the Payor and Hardy's. He did not know how many weeks he needed in 1992.
[1538] He said he could have delivered fish with his father Elmer Lewis. He did not recall how many times he would have delivered fish with his parents. He had no idea why DFO slips consecutively numbered would be delivered to his mother on the same dates as his.
[1539] The Appeals Officer, Lynn Loftus, was heard in this appeal on April 7, 1999.
[1540] She stated that the QMP scribblers were inaccurate for most of the time period in which this Appellant sold to the Payor in 1992. The Appellant was disqualified for the week ending September 19, 1992, because his name was not in the QMP scribblers. The Appellant was disqualified for the 1993 year because of the Respondent's decision as to the reliability of the QMP scribblers.
[1541] The Appeals Officer also said that flags were raised because certain DFO slips delivered to the Appellant and his mother were consecutively numbered. This question was put to the Appellant in the questionnaire which was sent to him by the Appeals Officer. The Appellant responded that the DFO slips were filled out by Sharbell and he took them as they were handed to him. Lynn Loftus admitted that the buyer had control over the DFO books.
[1542] She was asked what the Appellant could have provided to change her mind. She replied that she was not sure what could have been provided. She said that perhaps if Mrs. Lewis had provided her with a journal showing deliveries or calendar or something along those lines. The decision in the end was which records were more closely accurate.
[1543] This Appellant was truthful. He was not contradicted. Nothing could lead to conclude that he would have participated in any way in falsifying his DFO slip or record of employment or giving false information for any of his periods of employment in order to be eligible for unemployment insurance benefits. He had nothing to do with the books of the Payor. No evidence showed that he would have received more than one DFO slip at a time and the QMP records of the Payor could not be relied upon to establish this person's earnings.
[1544] The Appellant has established by a preponderance of evidence that his insurable earnings are those described in his records of employment issued for 1992 and 1993 by the bookkeeper or the accountant according to the records kept under section 77 of the Regulations.
[1545] This appeal will be allowed.
7. Paul Waite
[1546] The Appellant, Paul Waite, through counsel, in appeal No. 96-1767(UI), as to paragraph 6, admitted the allegations in subparagraphs a) to c), e), i), k) and l). The allegations in subparagraphs h) and j), were admitted, in part, for the 1993 year only with further explanations to be given at the hearing. The allegations in subparagraphs d), f), g), m) and n) were denied and disproven by the evidence.
[1547] This witness testified on January 22, 1999. The particular Exhibits for this witness are: B-3, B-3-1 to B-3-3 and R-7, tab. 19.
[1548] He explained that he fished lobster in 1992 and 1993 for Barry McNeill, (Exhibit R-7, tab. 19, pp. 17 and 18). He made one delivery of oysters to the Payor in 1993 in order to comply with the oyster lease agreement he had with the Government. "It was more or less to show that I was working the lease." He produced annual reports for the 1992 and 1993 years (Exhibit B-3, tab. 7).
[1549] He had one interview with Lew Stevenson. He was shown a page of a QMP scribbler with his name on it. He told the investigator that he did not fish oysters in 1992 and that he had sold to the Payor one shipment of oysters in 1993. He filed a copy of a report card (Exhibit B-3, tab. 6), showing to the Unemployment Office, his sale of oysters to the Payor in 1993, which corresponds to a DFO slip produced by the Respondent on page 20 of Exhibit R-7, tab. 19. This was the first time he had sold to the Payor. He did not know Dale or Blake Sharbell personally.
[1550] In 1992, he received no ROE from the Payor because he sold no oysters. He had expenses for that year for work carried out on his lease.
[1551] During the interview with Lew Stevenson, he tried to tell him that he did not fish oysters in 1992, because his brother-in-law drowned on September 6, 1992, (Exhibit B-3-1) and his wife had difficulty coping with that difficulty and did not want him on the water.
[1552] In 1993, he made no other deliveries
[1553] In cross-examination, he explained how he worked his oyster lease. He did not keep a diary of the work he did on the lease. He was questioned about the reports he filed (Exhibit B-3, tab. 7). He could not remember why his ROE from the Payor was issued in 1994 for a delivery of oysters in 1993. His DFO slip would have been made out the same day he delivered his oysters which was the same day they were graded. As to the oysters harvested on his leases, the quantities would only be estimated. He did not record the dates he harvested his oysters and he did not keep records of the oysters he took to the Payor; the only record he kept was his DFO slip.
[1554] As to the interview with Lew Stevenson, the investigator, the witness stated that he proceeded to explain why he had not fished oysters in 1992, but that the investigator did not want to listen to any explanations and that he was demanding and very insulting.
[1555] He was shown a second statement that was taken by Joe Pierce on the 6th of February 1996 (Exhibit R-15). He believed that his first interview with Mr. Stevenson was in October of 1995 but he was not sure. He was not shown the QMP scribbler as described in Exhibit R-7, tab. 19, p. 9. He was briefly shown the cover of a scribbler and it was put away. He did not sign his statement because the explanation he had given at the interview, which lasted a long time, were not included in the statement. He did not recall speaking to Rosie Ford of Revenue Canada. He remembers receiving a questionnaire.
[1556] In cross-examination, the Appellant stated that the sale he made to the Payor was not required for unemployment insurance benefits for 1993, since his claim was already established and he did not need a record of employment at the time.
[1557] The Appeals Officer, Rosemarie Ford, was heard in this appeal on April 8, 1999.
[1558] The officer said that the Appellant was given earnings in 1992 because of the reliability of the QMP scribbler. There was no ROE and no DFO slip in his name. She stated in her report that it was believed fishermen sold their catch for cash when they were on unemployment insurance benefits or sell the catch in someone else's name who needs the stamp. The Appellant had already acquired his 10 insurable weeks which would requalify him for unemployment insurance benefits so he would not need anymore sales. She admitted that the only evidence she had of that was the QMP scribbler showing that the Appellant had fished.
[1559] In 1993, the officer admitted that the total amount in the QMP scribbler was $888.00. The Appellant's DFO slip was $904.00. The Appellant reported $904.00 on his unemployment insurance card. She was then asked if this evidence showed the actions of someone who was trying to avoid the system? She replied that she did not do that to mean that she did not look at the facts in that way.
[1560] The Appeals Officer also said that if counsel's name had been written in the QMP scribblers by Sharbell or Martin Smith, he would be an Appellant (p. 225 of the transcript of April 8, 1999).
[1561] This Appellant was truthful and not contradicted. The QMP scribblers were not reliable and could not be relied upon to establish in any way this person's earnings.
[1562] Nothing in the evidence suggested that this Appellant did what the Appeals Officer assumed fishermen were doing when she stated in her report, (Exhibit B-3-2) on page 4, the following: "It is believed that fishermen sell their catch for cash when they are on U.I. benefits and/or sell the catch in someone else's name who needs the stamp. Worker had already acquired his 10 insurable weeks which would requalify him for U.I. benefits so, he would not need anymore".
[1563] This evidence did not show that this Appellant was associated with any illegal practice which the Appeals Officer suspected to be prevailing in the fishing industry. No evidence showed that this Appellant would have participated in falsifying a record of employment or making false statements in respect to any claim in order to obtain unemployment insurance benefits.
[1564] The Appellant has established by the preponderance of evidence that he had no insurable earnings with the payor for the 1992 year and had insurable earnings in 1993 in accordance with those described on his ROE issued for 1993 by the accountant according to the records kept under section 77 of the Regulations. This appeal will be allowed.
8. Loman MacLean
[1565] The Appellant, Loman MacLean, through counsel, in appeal No. 96-315(UI), as to paragraph 6, admitted the allegations in subparagraphs a) to c), e), h), i) and k) to m). The allegation in subparagraph j) was admitted with further explanations to be given at the hearing. The allegations in subparagraphs d), f), g) and n) were denied. The allegation in paragraph 7 was admitted and disproven by the evidence.
[1566] This Appellant was heard on January 22, 1999. The Exhibits relating to this worker in particular are B-5, B-5-1, B-5-2, B-5-3, B-5-4 and R-6, tab. 10.
[1567] This witness confirmed that in 1993 he made one delivery of eels to the Payor. He also signed a written "Fisherperson's Declaration", (Exhibit R-6, tab. 10, p. 22). He was shown pages 24 to 27 of the Exhibit R-6, tab. 10. It appeared that his name and surname were misspelled. He knew nothing about the QMP scribblers.
[1568] He was asked in particular about the date of September 16, 1993, where his name appears on p. 27 of Exhibit R-6, tab. 10. He said that on that date he could not have been fishing oysters and delivering to the Payor since he was lobster fishing as an employee of his father-in-law, Oliver MacDonald. When lobster fishing he would leave at five in the morning and return at sometimes seven o'clock in the evening and that it would have been impossible to fish oysters at the same time in Cascumpec, a considerable distance (25 miles) from West Point, P.E.I.
[1569] In cross-examination, he said that he went out lobster fishing pretty much every day. He would leave at five in the morning and return between six and eight o'clock in the evening.
[1570] In 1993, there was no season for speared eels and he did make one delivery to the Payor on June 19, 1993, before he began lobsters fishing with Oliver MacDonald, on July 27, 1993. He received a DFO slip for the delivery. He stated he could not fish lobsters and spear eels on the same day because one must have time to sleep.
[1571] It was suggested to the Appellant that he was unemployed in April, May and June and could have speared eels in those months. The Appellant replied that 1993 was the year he started in the spring to build an addition on his house. He either built it or finished it since he began in one season and finished the extension the following season.
[1572] He was then referred to page 25 of Exhibit R-6, tab. 10 and admitted that the number next to his name at the top of the page was his social insurance number.
[1573] The Appeals Officer, Patricia Griffin was heard on November 29 1999. She said that the reliability of the QMP scribblers was determinative in the case of this Appellant. The Appeals Officer gave him 11 more weeks of insurable earnings for 1993.
[1574] The Appeals Officer said that in order for the Appellant to refute all the sales in the scribblers he would have had to provide some documentation or a calendar that could have made the QMP scribblers look wrong. She was asked how would he prove he did not fish? She said that if he fished and kept a calendar of some sort and "it looked OK, it could be believable". She did admit that she was aware that the QMP scribblers were not accurate but she never asked why they were not accurate. She relied on what the master file enunciated. She also said she was given no instructions to interpret the Regulations narrowly.
[1575] The evidence of this witness was truthful and not contradicted. No evidence showed that the Appellant would have given false information or participated in falsifying records of any kind in a claim for benefits.
[1576] The Appellant has established by a preponderance of evidence that his insurable earnings are those described in his record of employment issued for 1993 by the accountant according to the records kept under section 77 of the Regulations.
[1577] This appeal must be allowed.
9. Keith Lewis
[1578] The Appellant, Keith Lewis, through counsel, in appeal No. 96-2314(UI), as to paragraph 5, admitted the allegations in subparagraphs a) to c), e) and h) to k). The allegations in subparagraphs d), f), g) and l) were denied and disproven by the evidence.
[1579] This Appellant was heard on January 25, 1999. The Exhibits relating to this witness may be found in B-4, B-4-1, B-4-2, B-4-3 and R-5, tab. 9. He has been fishing for about 50 years.
[1580] He stated that he delivered clams to the Payor in 1992 and he received DFO slips that correspond to the weeks reflected on his record of employment from the Payor for that year.
[1581] He filed a statement he gave to the investigator Joe Pierce on May 24, 1995, (Exhibit B-4-1). He explained the atmosphere at the interview. He stated that Joe Pierce was writing the statement but that Lew Stevenson was asking the questions. The witness said that he was called a liar at the interview because "his name wasn't in the Payor's QMP scribblers" and this would indicate that he had no sales with the Payor. He explained certain affirmations in his statement which were not recorded as he had stated them. He on account of that did not sign his statement.
[1582] He described his fishing activities and how he delivered his fish. He would receive a DFO slip that covered the total deliveries for the week. He sold no oysters to the Payor in 1992. What he sold were clams for the five weeks represented by his DFO slips (Exhibit B-4, tab.3).
[1583] He said that the questionnaire, Exhibit B-4, tab. 4, was completed at an interview he had with Gary Robbins, the Rulings Officer. He then met with Patricia Griffin of Revenue Canada and gave her the same information.
[1584] The Appeals Officer in her report, (Exhibit B-4, tab.7, p.22) gave credit to the Appellant for oyster sales which he never sold to the Payor in 1992. He had no knowledge of the QMP scribblers. He also explained how his wife at times filled out his oyster lease reports, (Exhibit R-5, tab. 9, p. 21).
[1585] He was cross-examined. He described his relationship with other Appellants with the family name Lewis. He explained that in 1992, he owned a shellfish lease for oysters, clams and mussels. He estimated the quantity of shellfish harvested from his lease and he explained that what was taken off his lease was done not only by him but by other members of his family.
[1586] All he had for records of his sales to a buyer would be his DFO slips. He also sold to Roger Burleigh and P.E.I. Aqua farms and he has his DFO slips for those sales.
[1587] He reiterated that he sold no oysters to the Payor. He only sold clams
[1588] He was questioned as to how he received exactly the same amount of dollars for each of three deliveries of clams even if there was a price change from .80 ¢ to .90 ¢ a pound. He did not know since he did not do the book work but he was sure that the amounts on the DFO slips were what he received.
[1589] He repeated that he made deliveries during the week and when he delivered more clams at the end of the week he was paid and given a DFO slip by the buyer. He explained that he did not know how the buyer arrived at the total amount on his DFO slips and suggested that the buyer might make certain deductions such as his deductions for unemployment insurance stamps.
[1590] Then he was asked by counsel for the Respondent whether he meant unemployment insurance premiums or did he mean the price he would have to pay to receive a DFO slip from Mr. Sharbell. The suggestion here was that the Appellant would have bought a DFO slip from the Payor in order to obtain benefits. The Appellant denied ever buying a DFO slip from the Payor or anyone else. He reaffirmed that what was marked on his DFO slip was what he received and if it was not, he would have pointed it out to the buyer. He had no reason to believe that the buyer was cheating him on the weight of his clams.
[1591] He was also asked if he knew whether anyone was paying the Payor for a stamp. His answer was that he had no knowledge of that.
[1592] He said he used a boat for fishing but not necessarily every time he was digging clams. He did not actually use the boat for fishing, sometimes he would take a ride with Lloyd Lewis across the water to get to the fishing area or transport the clams with the boat. He would dig his own clams.
[1593] In 1992, he did not believe he signed a written declaration but he declared the area where he fished. He received payment in mid week for the clams he delivered. At the end of the week when he delivered more clams, he would be paid and also received his DFO slip for the week's delivery. He did not have a mechanical harvester in 1992. He sold oysters to Burleigh Brothers instead of Sharbell's because they were paying more.
[1594] He stated that his unemployment insurance premiums were deducted at the end of the week, when he was paid.
[1595] The Appeals Officer, Patricia Griffin, was heard in this appeal on November 29, 1999.
[1596] She said that she had no input nor was she involved in the analysis that was carried out by Lynn Loftus. She did not have any input in the decision to use the QMP scribblers. In fact, she based her decision on the analysis done by other officers.
[1597] She began her duties in the appeal process concerning Sharbell's Fish Mart on June 7, 1996 when files were assigned to her.
[1598] She was cross-examined by Allan Shaw, counsel for the Appellant. She said she met in person with the Appellant. The Appellant told her he did not sell any fish to the Payor. He said that he might have been with his son when he delivered his fish. The Appellant told her that he sold to other buyers. He also told her that he thought he had sold clams to the Payor in 1992.
[1599] The Appeals Officer said that the Appellant was very straightforward in his answers. She admitted that the Appellant preferred to speak with someone rather than to answer questionnaires.
[1600] She admitted that the Appellant's DFO slips matched his ROE and that he did have maximum earnings. She did not realize that there was no commercial season for fishing oysters in July or August.
[1601] She believed the Appellant fished but she had made him aware that his name was in the QMP scribblers for oysters.
[1602] She was asked what more could the Appellant have done to show that he had not sold oysters to the Payor. She did not know but she said "may be if he hadn't sold oyster at all to anyone".
[1603] She was asked how she knew that the QMP scribbler was accurate. She answered "I went with what had already been done, the master file". She admitted that it was the basis of her decision. She never checked with Dale Sharbell. She was also asked if the sales of the Payor exceeded the purchases listed in the QMP scribbler where would that extra fish sold come from? She replied that "it didn't come to my mind".
[1604] The four weeks of earnings that were allowed the Appellant were four of the five weeks he had in his ROE. The Respondent disallowed the week of July 25. He had the ten weeks required prior to the decision and the loss of the week made him ineligible to benefits for that year.
[1605] She admitted that the whole decision was based upon the QMP scribblers.
[1606] This Appellant was not contradicted and gave a truthful account of what went on some seven years ago. Nothing in the evidence could demonstrate that this Appellant would have participated in the falsifying of DFO slips or his record of employment in order to obtain unemployment insurance benefits. The suggestion made by counsel in questioning this Appellant as to the possibility that he or others might have bought a DFO slip had no foundation whatsoever. It only reflected the mindset of the Respondent in dealing with these Appellants. Nothing in the evidence could suggest even remotely that he ever bought a DFO slip. The Minister's assumption was not based on any evidence.
[1607] The Appellant has established by a preponderance of evidence that his insurable earnings are those described in his record of employment issued for 1992 by the bookkeeper according to the records kept under section 77 of the Regulations.
[1608] This appeal must be granted.
10. John Arsenault
[1609] The Appellant, John Arsenault, through counsel, in appeal No. 96-2316(UI), as to paragraph 6 admitted the allegations in subparagraphs a) to c), e) and h) to m). The allegations in subparagraphs d), f), g), n) and o) were denied and disproven by the evidence.
[1610] This witness testified on January 25, 1999. The Exhibits that relate to this Appellant are B-6, B-6-1 to B-6-4 and R-4, tab .1.
[1611] He had eight deliveries with the Payor in 1993 and two weeks of insurable earnings with Genu Products Canada Ltd.
[1612] In 1993, he delivered eels to the Payor plus one sale of soft shell clams and one sale of quahaugs.
[1613] He filed a copy of the interview he had with Lew Stevenson, dated March 1, 1995. He said the interview was "wild" and that Lew Stevenson did not accept what he was saying. He was called a liar. He signed his statement but he could not read it. He said he did not have much education. He said he signed only one of the two pages. He was shown a copy of a questionnaire which he obtained through the Privacy Act (Exhibit B-6, tab.5). He said that he likely got somebody to fill it out for him because he was unable to do so. He did not sign the questionnaire. He does not do interviews over the telephone. He had no idea how the questionnaire was filled out.
[1614] He was shown another questionnaire (Exhibit B-6, tab. 8). He had someone fill out this document. He never fished with this brother-in-law, Marvin Clements. The first time he heard about the QMP scribblers of the Payor was at the first interview he had. He never owed or borrowed money from the Payor.
[1615] When he went to the interview, he took with him what he was asked and had all his papers in an envelope and allowed the investigator to photocopy them. He produced receipts (Exhibit B-6-2) and stated that the dates of the receipts correspond to some of the DFO slips.
[1616] He was shown Exhibit R-4, tab. 1, p. 42. He said that he never fished with Marvin Clements. He fished alone.
[1617] The Appellant was cross-examined. He stated where and how he fished eels. He delivered during the week and was paid. At the end of the week he would get his DFO slip. He also said that he would made his declaration to the buyer at the end of the week for the entire week.
[1618] In 1993, he fished soft shell clams for the first time. He did not know the areas. He made one big delivery of clams and one of "quahaugs" to the Payor.
[1619] He was questioned about the inscription on the copies of the QMP scribblers reproduced in Exhibit R-4, tab. 1, pp. 13, 40 and 41. He had no clue what the inscriptions meant. He was never given a DFO slip for an amount of fish he did not deliver.
[1620] He was questioned as to why two DFO slips for deliveries made in two separate weeks would both be in the amount of $600.00. He did not know although it was noted that the price changed and the quantities were different.
[1621] He said he did not purchase gas at every delivery. He repeated that he and Marvin Clements never fished together. He stated that Marvin Clements fishes mostly Irish Moss; and to his knowledge did not fish eels but fished clams. He could not say whether Marvin Clements fished quahaugs and he never delivered fish with him.
[1622] The Appeals Officer, Lynn Loftus, was heard in this particular appeal on April 6, 1999.
[1623] She agreed that this Appellant was consistent with what was in the questionnaires he sent in.
[1624] The Appeals Officer took the position that this Appellant was sharing his fishing with Marvin Clements because their names appeared on the same page of the QMP records.
[1625] The Appeals Officer did not indicate in her report having contacted Marvin Clements. She felt that the onus was on the Appellant to refute the QMP scribbler and that the Appellant had the opportunity to have Marvin Clements contact her. She allocated what was in the QMP scribbler to the Appellant at a rate of fifty percent because she concluded that they both shared their catches.
[1626] She said in re-examination, that when she found this inscription on a page of the QMP scribbler (Exhibit R-4, tab. 1, p. 41) there was some doubt cast on what the Appellant had told her about not fishing with Marvin Clements.
[1627] In examining the QMP scribbler, there is only one page where the name John Arsenault appears with a social insurance number, all the other pages do not. Further, pages 38 and 39 (Exhibit R-4, tab. 1) make it difficult to find the name of the Appellant.
[1628] This witness was not contradicted and gave a truthful account of what took place some six or seven years past. No evidence could show that this person would have falsified in any way a DFO slip or a record of employment in order to qualify for benefits.
[1629] The only year in issue was 1993, but from all appearances in 1992, he would have fished, delivered, been paid and was issued with DFO slips in the same manner as 1993.
[1630] The only reason he appears to have been assessed differently in 1993 was the existence of the QMP scribblers which cannot be relied upon to determine this Appellant's earnings for 1993. The Appeals Officer's interpretation of what took place was not acceptable.
[1631] The Appellant has esetablished by a preponderance of evidence that his insurable earnings are those described in his records of employment issued for 1992 and 1993 by the bookkeeper or accountant according to the records kept under section 77 of the Regulations.
[1632] The Respondent further admitted that the 1992 period in question was not a matter subject to the appeal filed herein.
[1633] This appeal must be allowed.
11. Dale Rafferty
[1634] The Appellant, Dale Rafferty, through counsel, in appeal No. 97-1206(UI), as to paragraph 6 admitted the allegations in subparagraphs a) to c), e) and k). The allegation in subparagraph j) was admitted with further explanations to be given at the hearing. The allegations in subparagraphs d), f) to i) and l) were denied and disproven by the evidence.
[1635] This witness testified on January 25, 1999. The Exhibits that are of interest in the analysis of this Appellant's evidence are B-8, B-8-1 to B-8-3 and R-6.
[1636] In 1992, he fished lobster with Roger Milar in the spring. He also fished oysters with Burleigh Brothers. He was interviewed on December 7, 1995. He told the investigator that he was licensed to fish oysters is the spring and in the fall, quahaugs, eels and mussels. He also owns an oysters lease in Foxley River. He denied having fished oysters from his lease to sell to Burleigh Brothers as was written in his statement (Exhibit B-8, tab. 2). He said he fished those oysters in the Biological Station in Grand River and Baddeck. He said that he delivered some oysters to the Payor and sold them for his children and he never sold oysters to the Payor for himself.
[1637] He said to the investigator that he fished and sold to Leslie Hardy in 1993. He stated that the investigator, Lew Stevenson, was not really polite.
[1638] He was shown Exhibit B-8, tab. 3 and R-6, tab. 13, p. 9. The witness stated that he had never seen the QMP scribblers before.
[1639] He was contacted by phone on February 20, 1997 and he was referred to the questionnaire that is found on page 11 of R-6, tab. 13. He said he took oysters down to the Payor for his wife and for his children and personally never sold any oysters to the Payor in 1992. He also said that he signed Fisherperson's Declarations when he delivered oysters for his wife Sandra Rafferty (Exhibit B-11, tab. 3) in 1993 on three occasions.
[1640] In cross-examination, he admitted having delivered oysters in 1992 and 1993 to the Payor for his wife. He did not deliver all the oysters for Sandra Rafferty in 1992 and 1993, because his wife delivered some herself. He did not know which deliveries she made. He would help his wife with the deliveries because she may have been tired. He also said that his wife was a part-time hair dresser in 1992 and 1993.
[1641] He worked ten weeks for Roger Millar and nine weeks for Burleigh Brothers. He was averaging his earnings in 1992 the maximum insurable earnings of $710.00 per week. He reiterated that he sold to Burleigh Brothers the oysters that he fished at the Biological Station at Grand River and Baddeck. He had close to the maximum insurable earnings and weeks he needed to qualify for benefits in 1992.
[1642] He was then asked why he did not receive a record of employment for the oysters he delivered to the Payor in 1992. To this, he replied that they were not his oysters. He also explained how his children fished oyster from his lease in 1992.
[1643] He did not know whether he filed in full for unemployment insurance benefits in July of 1992. He said that he had a septic tank truck business in 1992 from which he made $3,200.00 as business income.
[1644] He did not know where the DFO slips for Sandra Rafferty which are found in Exhibit R-6, tab. 14 at p. 25, were signed. He believed that he did receive a DFO slip for his wife in 1992 or 1993 but he did not know. He delivered oysters at times with his wife, but could not specify dates or occasions and had difficulty remembering that far back.
[1645] He and his wife Sandra Rafferty were both eligible for unemployment insurance benefits in 1992 and 1993.
[1646] Elizabeth White, the Appeals Officer in this case, was heard on December 2, 1999. She became an Appeals Officer in 1994. Her involvement in the Sharbell enquiry began in the spring of 1996.
[1647] She reviewed the information contained in the master file and sent out questionnaires to the Appellants she dealt with. She had no involvement in the analysis of DFO slips or the QMP scribblers. Her decisions would have been consistent with what was in the master file.
[1648] In cross-examination, she said that she worked on the files in this case from the spring to the fall of 1996. She had not worked before with a master file. She did however work with a group of files before where a form of consistency was required. She said that in these cases it was necessary to be consistent to a point. She said that assessing credibility was a "subjective thing".
[1649] She mentioned that "what we retained from the master file was "information on the process used to determine earnings for the individual". She could not be specific, because she had not read the master file since she saw it in 1996. She said that the master file was a variable amongst others.
[1650] She never spoke to Dale Rafferty because he was not responding to her enquiries.
[1651] She was asked to explain what was meant by the comment contained in her report where she stated: (Exhibit B-8, tab. 5, p. 12)
"In those case where soft-shell clams or oysters were delivered during the periods shown above as having QMP and sales invoices agree, then the QMP records are accepted as accurate and the insurable weeks and earnings are based on the QMP records unless proven otherwise by the fisher."
[1652] She explained that when the QMP scribbler was considered reliable the fishermen's earnings were based on them "unless there is documentation provided (by the Appellant) to the contrary". The standard "would be beyond any reasonable not 100%". In fact, she relied on the master file. If the QMP scribbler was reliable she accepted that position and the onus then shifted to the Appellant to show that the QMP scribbler was incorrect.
[1653] In the case of Dale Rafferty, he had the onus to prove that he did not fish. She was asked how Dale Rafferty could prove he did not fish. Her reply was that she did not know. She could not recall if anyone had succeeded in proving they had not fished.
[1654] She admitted that Dale Rafferty had told her that he had not sold oysters to Sharbell on the dates shown in the QMP scribbler. She made her decision and deemed the QMP scribblers to be correct and it would have been redundant to check the validity of the QMP records.
[1655] She admitted that there was no DFO slip, no ROE. She had a statement from the Appellant stating that he did not fish. She also admitted that there were not a lot of information or factors to weigh.
[1656] She admitted that the person who would most likely know if the Appellant had sold fish was Dale Sharbell. She did not contact anyone to specifically ask that question. She believed that Dale Sharbell was not responding any longer to enquiries of the Respondent.
[1657] In the summary of her report she indicated that the QMP scribbler was reliable. She allocated minimum weeks to the Appellant because the Appellant had indicated he fished with a boat so he would be eligible for the minimum week. It was suggested to her that she did not believe the Appellant. She replied, that she would not put it that way, but added "the information I had, there wasn't enough to shift the balance. I didn't disbelieve him and there was no documentation to back up what he was saying and documentation would have helped".
[1658] This appellant was not contradicted. It appeared that some of his wife's deliveries were made by him. This would not be unusual especially if there were children at home; if Sandra Rafferty, his wife was fishing oyster during the day and he could look after the children, when she returned, it could be understood that he would deliver the oysters for her.
[1659] The delivery of the fish in the name of his wife would not make the appellant a party to a promise of sale or a sale especially if the DFO slip was later made out to his wife. The preponderence of the accepted evidence would show that the parties to the sale were the wife and the Payor.
[1660] This was probably why Stan McCallum of Revenue Canada would have favourably advised the buyer that a husband could deliver for his wife.
[1661] The evidence did not show that this Appellant would have fished and sold oysters to the Payor in 1992 and the QMP scribblers are not reliable to give them any input as to deliveries of fish to the Payor. No evidence showed that he would have participated in falsifying records of employment or other documents or made false statements in any claim for unemployment insurance benefits.
[1662] This appeal will be allowed.
12. Sandra Rafferty
[1663] The Appellant, Sandra Rafferty, through counsel, in appeal No. 97-510(UI) as to paragraph 6, admitted the allegations in subparagraphs a) to c), e), j) and k). The allegations in subparagraphs d), f) to i) and l) were denied and disproven by the evidence.
[1664] This Appellant testified on January 25 and 26 of 1999. The Exhibits of interest to this Appellant in the review of her evidence are B-11, B-11-1 to B-11-4 and R-6, tab. 4.
[1665] She sold oysters to the Payor in 1992 and 1993. She recognized the handwriting of Dale Sharbell on some DFO slips and the handwriting of Marilyn Enman on others. She explained that she would deliver her oysters to the Payor and the next day she would pick up her money and her DFO slips. She did not get her money immediately because at Sharbell's they were busy grading oysters with too many fishermen ahead of her waiting.
[1666] She was shown the fishermen's declarations signed by her husband in 1993. She did not remember signing herself this type of document in 1993. In 1992, she picked her oysters off her husband's lease and in 1993 she used a dory to fish them.
[1667] She was interviewed by Lew Stevenson and thought he was "pretty ignorant". She knew nothing about the QMP scribblers.
[1668] She was referred to the questionnaire that she obtained under the Privacy Act. She was not certain of some answers she gave. In 1992, she would have been paid and received her DFO slips from Marilyn Enman. In 1993, she would have picked up her DFO slips at times at the store. She received her DFO slips at the end of the week. Normally she would leave her oysters to be graded with her name and the number of boxes. She did not remember filling out a declaration for 1993.
[1669] She received, as receipts, her DFO slips and considered them as official. She explained that she had provided receipts and a joint bank account showing deposits. She was read part of the Appeals Officers report (Exhibit B-11, tab. 5, p. 36 and following). Then she was asked whether she could give more details in relation to her fishing in the 1992 and 1993 years. She explained what she did in 1992 and spoke of her children's ages.
[1670] In cross-examination, she stated that she never picked up more than one DFO slip at a time. She generally left her oysters to be graded and did not wait around. She did not know how many deliveries her husband made for her. Her husband was glad to get out of the house and deliver the oysters and she would take over watching the kids. She also went to deliver with her husband. He would probably have made more of her deliveries. She picked up her money and DFO slip at Marilyn Enman's place because it was closer to her home. There was the odd occasion when her husband might have picked up her money and DFO slip. She had no records to show when her husband picked up her DFO slip as opposed to when she picked it up.
[1671] It was then suggested to her that her arrangement to pick up her DFO slip and get paid did not occur in any other case the Minister came across, so that there must have been an arrangement between her husband, herself and the buyer. She replied that the only arrangement was what she had explained.
[1672] When she delivered her oysters, she would write her name on a piece of paper and leave it with her oysters and she presumed that Dale Sharbell graded the oysters and passed the information on to Marilyn Enman who prepared the money and the DFO slip.
[1673] She is not related to Gerald Wagner and he is not a friend or an acquaintance of hers. She made no written fishermen's declarations in 1992 or 1993.
[1674] She then was questioned about her husband's lease and when and what work was done on it. Her husband did most of the work on the oyster lease. The fishing was left for her to carry out.
[1675] She said that she operated a hairdressing business out of her home in 1992 and 1993. She said that what she claimed on her income tax return is what she made. In 1992, she declared $762.00 and $1,200.00 in 1993.
[1676] While she fished, her husband was not working elsewhere and his responsibility was to look after the children and he did not fish oysters.
[1677] She could not remember what she was paid in a given week. She supposed that she paid her unemployment insurance premiums but she did not see the paperwork for that. She presumed that Unemployment Insurance deductions were made when she received her DFO slip. She said that what was deducted off her pay must be on her T4 slips. The only records she had were her DFO slips and her records of employment. As to what was paid as unemployment insurance premiums, she replied that Marilyn Enman was the bookkeeper and when the T4 slips are received the unemployment insurance deductions are identified.
[1678] She was shown two records of employment (Exhibit R-6, tab. 14, pp. 19 and 20) and had no idea whether one or both were filed when she applied for unemployment insurance benefits in 1993. She did not know why there were two or why one was signed by Blake Sharbell. She was questioned as to why Marilyn Enman did not sign the Appellant's ROE as dozens were signed by her in 1992. The witness said that she did not think that Marilyn Enman was living in 1993 and she did not know who did the bookkeeping for the Payor after that.
[1679] She then explained what was involved in fishing oysters from the fishing stage to the delivery stage. She filed Exhibit R-23 which was a summary prepared by the Respondent of her 1992 and 1993 DFO slips.
[1680] In 1993, she would have picked up her DFO slips at Sharbell's. It was her husband Dale who would have picked them up most of the time. She was shown the DFO slips in R-6, tab. 14, pp. 25 to 28 and she did not know who wrote them out. She could not recall picking up DFO slips. She never saw someone write up a DFO slip because she left her oysters for grading and when she returned everything was ready. She could not say why some of the DFO slips were consecutively numbered.
[1681] In 1992, she did not use a boat but in 1993, she did. She explained how she fished oysters out of a dory. She had ten insurable weeks both in 1992 and 1993. She and her husband both qualified for benefits in 1992 and 1993. She said she had no records with her this day to prove that her DFO slips were accurate. The only records she had were her DFO slips.
[1682] She lives 12 to 13 miles from the Payor. Her oysters were graded. If there is only one price on the DFO slip that would indicate that they was one grade of oysters.
[1683] In re-examination, she indicated that she received the documents, (Exhibit B-11, tab. 5) under the Privacy Act.
[1684] She was questioned by the Court in relation to her records of employment from the Payor for 1992 and 1993 in relation to her T4F forms issued by the Payor.
[1685] The Appeals Officer, Elizabeth Whyte, was heard on December 2, 1999. She spoke to the Appellant over the telephone. This Appellant had the same onus as her husband. When the QMP scribbler was reliable according to the Respondent the Appellant had to prove otherwise.
[1686] The Appeals Officer stated that because the Appellant's husband had signed her declarations, that she had children and no day care, that she was unfamiliar with the buying process, that her husband owned the lease and was on unemployment insurance benefits on a labour stamp, she would not have fished
[1687] She also said that the husband could not look after the children while the Appellant fished because he would have had to be available for work and "you cannot be looking after children if you are actively seeking employment".
[1688] The Appeals Officer did not ask the Appellant what hours she fished off the lease. She considered all the receipts that were provided by the Appellant. The Appeals Officer admitted that the Appellant had told her that the children aged 8, 10 and 12 years fished with her. She admitted that she never went back to the Appellant to discuss concerns she had about the decision she had to render.
[1689] The name of the Appellant was not in the QMP scribbler in 1992 but was in 1993. The Appellant was not considered to be in insurable employment in 1992 and 1993.
[1690] The Appeals Officer said that she did not overturn the QMP, where Mr. Macdonald, the Chief of Appeals, said they were correct. When there was evidence the Appellant fished, she would allow the minimum week.
[1691] The Appeals Officer said further that the Appellant had to prove that she had fished and her husband Dale Rafferty had to prove "he hadn't fished".
[1692] The evidence of the Appellant was not contradicted. The evidence of the Appellant and her husband cannot be put aside for any valid reason. They have established to the satisfaction of the Court that this Appellant actually fished in both years of 1992 and 1993.
[1693] The time lapse between the hearing in 1999 and the fishing periods of 1992 and 1993 would make it impossible for any person to actually remember all the details of their fishing if they had no DFO slips.
[1694] The Appellant relied in part on the records that were to be kept by the buyer as this was what was relied upon by the Respondent in accepting over the years records of employment that were made up from the DFO slips. She also relied on her DFO slip.
[1695] The fact that the husband delivered her fish did not alter the fact that she actually did the fishing. The presence of children in the family and the mother fishing could explain the husband accepting to deliver the catch at the end of the day. What actually happened was reflected in the written declaration. There was no cheating if the term may be used.
[1696] The fact that she left her oysters to be graded with her name on the boxes and returned later to obtain her DFO slip could not lead to conclude that she did not fish or that the quantity was wrong or the DFO was false or the sales between her and the buyer did not take place as the Court explained in the case of her husband.
[1697] It could mean that she trusted the buyer to pay her what he owed. It would not be unusual that a situation of that sort occur, especially if she had to return home for other reasons.
[1698] The fact that both the Appellant and her husband qualified for unemployment insurance benefits in both 1992 and 1993 years could not lead to conclude that the Appellant did not fish or that there was something amiss in that sort of situation. It could mean however that the fishing periods being as they are and the financial situation being what it is, both spouses had to work as much as possible to keep the household running.
[1699] No evidence showed that this Appellant participated in falsifying records of employment or other documents or making false statements in relation to any claims for unemployment insurance benefits.
[1700] The Appellant has established by a preponderance of evidence that her insurable earnings are those described in her records of employment issued for 1992 and 1993 by the bookkeeper or accountant according to the records kept under section 77 of the Regulations.
[1701] This appeal must be allowed.
13. Pius Bulger
[1702] The Appellant, Pius Bulger, through counsel, in appeal No. 97-552(UI), as to paragraph 5, admitted the allegations in subparagraphs a) to c), e) and h) to l). The allegations in subparagraphs d), f), g), m) and n) were denied and disproven by the evidence.
[1703] This Appellant was heard on January 26, 1999. The exhibits of particular reference for this person are B-12, B-12-1 to B-12-3 and R-6, tab. 2.
[1704] In 1992, he fished lobster and had seven weeks of employment with Elliot's Fishery and three weeks with Leslie Hardy.
[1705] In 1993, he had a record of employment for one week with the Payor.
[1706] He was interviewed by Lew Stevenson and Joe Pierce on November 28, 1995. He was questioned in relation to specific dates and what he did in those periods of fishing in 1992 and 1993. He could not remember anything since it was too long ago.
[1707] He spoke of his interview with the investigators and stated they were not too friendly. He did not have any of his records with him at the interview. He did not know anything about the QMP scribblers.
[1708] He referred to his income tax return and his T4F for 1992 (Exhibit B-12, tab. 9) which showed that in 1992, he sold something to the Payor in the amount of $462.00. He did not feel that he needed that for unemployment insurance purposes, so he filed it as income.
[1709] In 1993, he received three DFO slips from the Payor (Exhibits B-12, tab. 8 and B-12-1). They are dated August 15, September 10 and October 28, 1993. For the first two sales, each in the amount of $205.00 he was informed by Stan McCallum of Revenue Canada, that he did not have to take a stamp for those sales in 1992. In 1992, he reported the earnings of $462.50 from the Payor (Exhibit B-12, tab. 9, p. 32) and in 1993 he reported the total earnings from the Payor of $655.20, (Exhibit B-12, tab. 9, p. 40). The only record he has for 1992 is his T4 and for 1993 the DFO slips and his T4. The only record he would receive for a sale of fish was a DFO slip.
[1710] In cross-examination he said that in 1992, he did not receive a DFO slip for his sale of fish. He was not sure whether he sold to the Payor in 1992 but when he received his T4F, he realized that he must have sold something to the Payor and did not get a DFO slip for it. He did not keep any records of what he sold to the Payor in 1992 or in 1993, he trusted the buyer to do whatever was right.
[1711] He was shown a record of employment from Leslie Hardy and son. He sold oysters to Leslie Hardy and he worked for Nelligan's Fisheries Ltd. (Exhibit R-4, tab. 2, pp. 8 and 9). In 1992, with these two employers he had ten weeks of insurable earnings.
[1712] He was shown his record of employment for the Payor in 1993. He said that it was an accurate document because it reflects one week of insurable earnings for the week of October 28, 1993. He was shown his three DFO slips for 1993 and only the one dated September 10, 1993 was marked no "stamp". He did not know why the two DFO slips in Exhibit R-4, tab. 2, p. 21, were numbered consecutively although they were issued one month apart. He did not know what the Payor was doing when he was issuing his DFO slips.
[1713] The Appellant was not aware that the minimum insurable earnings for a week was $149.00. He was asked that, since he could indicate to the buyer that he wished to take a stamp or not, if it was not indicated on the DFO slip where else could it be marked. The witness had no idea except to say that you could tell it the buyer. He was mostly present when the DFO slips were filled out.
[1714] He did not know if there was a reason for not requesting a stamp on a sale of $205.00 but he knew he would be paying income tax on the amount.
[1715] He kept eels in crates and he saved them until he was finished fishing, and then, he would sell them. If he needed an extra stamp, he would use the eels.
[1716] It was suggested to him that the reason he would not require a stamp for his $205.00 sales of clams in September was to maximise his week of insurable earnings for the week ending on October 30, 1993. He replied that it was not deliberate and that he was winding down his fishing season and since he had the eels stored he wanted to sell them before the end or the season. If he did not take a stamp for September 10, 1993, it was because he thought he did not have to take one.
[1717] He said he fished clams in Foxley River in 1993. For his deliveries of clams to this Payor on August 15, and September 10, 1993, he could not say if it represented one or more deliveries for these weeks. The only documents he kept as records were his DFO slips.
[1718] In answer to questions from the Court, the Appellant explained that when a fisherperson would indicate to a buyer that for a particular sale of fish he requested "no stamp", that would indicate that the fisherperson did not want the amount of the sale to be applied or calculated as an earning for unemployment insurance purposes.
[1719] The Court then put several question to the witness. He did not know whether the Payor would have made a correct statement in a record of employment if he records one sale of fish instead of three as was done in this case. He thought that he did not have to take a stamp if he did not want one.
[1720] He said "the only thing I can say is that I didn't think that I had to take a stamp for everything I sold and that's why that ROE is like that". The record of employment from the Payor for 1993 (Exhibit B-12, tab. 1, p. 3) does indicate that the first day of fishing was August 15, and the last October 28, 1993. It shows one delivery on October 28.
[1721] The Appellant had no idea if his unemployment insurance benefits would have been affected if the three deliveries had been recorded on his record of employment. He did not know if his payments would have been increased or decreased. He admitted that there must be a reason for requesting that sales not be calculated as insurable earnings but he did not know what the reason was.
[1722] The Appeals Officer, Patricica Griffin, was heard on November 19, 1999
[1723] She did not participate in preparing the validity or the volume analysis of the QMP scribblers of the Payor.
[1724] She upheld the rulings for the 1992 year because the QMP records matched with the sales invoices for the oysters at Sharbell's for the period of July to October 1992. There was no DFO and no ROE for 1992. In 1992, declarations were verbal, they were not in writing.
[1725] The Appellant did have for 1992 a T4 from the Payor in the amount of $462.50. The Appeals Officer said that the Payor had said that if the fisherman did not want a stamp it would be written on the DFO slip. The Appeals Officer admitted that the Appellant was very clear in his questionnaire (Exhibit B-12, tab. 6) especially in his last two questions. He had stated that he had no record of sales to the Payor in 1992 but did have a T4F slip. He also declared these earnings on his income tax return for 1992.
[1726] In 1993, the Appeals Officer said that the Appellant had been given four weeks of insurable earnings at the minimum of $149.00 because the QMP scribbler was reliable (Exhibit B-12, tab. 8, pp. 28 and 29). Counsel for the Appellant suggested to the Appeals Officer that the total sales of the QMP would represent $207.00 and the Appellant paid taxes according to the Payor's T4F (Exhibit B-12, tab. 9, p. 40) on $655.20. This would then suggest that the Appellant was paying taxes on more money than what appeared in the QMP scribbler.
[1727] The Appeals Officer maintained that she relied on the QMP scribbler and that in 1992 she had no documents not even a DFO slip, and in 1993, the Appellant would have provided two DFO slips and the one that was marked "no stamp" was not on his record of employment.
[1728] The evidence of the Payor's books and records for 1992 (Exhibit R-20, vol. 1, p. 2) which were not reviewed by the Appeals Officers show Pius Bulger (SIN 100-166-719) with two weeks of income on January 4 and 11 of 1992 for a total of $462.50. Next to one of the weeks is the expression "no stamp". It was not shown whether that would apply to the two weeks of earnings or to one. The person who made up these 1992 pay records is now deceased.
[1729] The Appeals Officer said that for 1992 and 1993 she made her decision according to the QMP scribblers. In 1992, she said she had no records although they existed (Exhibit R-20) and in 1993 the Appellant had three DFO slips and the Payor's records (Exhibit B-12, p.31) showing one week of insurable earnings of $250.00.
[1730] In this case the QMP scribbler was deemed accurate by appeals for oysters from July to October of 1992 and the Appellant's name was shown in the QMP scribbler of the Payor for oysters. In the Payor's records (Exhibit R-20) which were not looked at by the Respondent the Appellant's earnings are for two weeks in January.
[1731] The evidence of this witness was truthful.
[1732] It appeared to the Court that there was a practice to the knowledge of the Respondent for fishermen to request that certain sales not be applied as insurable earnings.
[1733] The evidence showed in this case that the Appellant would have notified the Payor as reflected in the Payors books of records (Exhibit B-12, tab. 8, p. 31), that his two sales of August 15 and September 10, 1993 were not required for "a stamp". He did however declare those sales of fish on his income tax return for the 1993 year, (Exhibit B-12, tab. 6, p. 40).
[1734] The Appellant also declared his sales to the Payor on his 1992 income tax return. In 1992, he had no insurable earnings and no record of employment was issued. The Payor's books and records for 1992 (Exhibit R-20) indicate on page two, two sales for the Appellant on January 4 and 11, in the amount of $212.50 and $250.00 respectively for a total of $462.50. The entry for January 4, 1992 indicates "no stamp" next to it. Did this apply to both sales or not? The evidence did not show that.
[1735] The Minister did not examine the pay records for 1992. The QMP scribblers produced in R-4, tab. 2, p. 11 and 24, make no indication of deliveries in January of 1992. What was the Appellant selling to the buyer in January for a total of $462.50? The Appellant, in January of 1992, appears to have been receiving unemployment insurance benefits as is shown on his application for benefits (Exhibit R-4, tab. 2, p. 7). Did he report these sales on his claimant's report card? One must assume he did. This evidence would indicate that the entries for sales in the QMP scribblers were lacking this information.
[1736] The only acceptable conclusion in this Appellant's case is that he declared to the Respondent his earnings and what he declared as insurable earnings is what was accepted by the Respondent.
[1737] No evidence showed that he would have participated in any way in falsifying his DFO slips or his records of employment or did not declare to the Respondent in some way his actual earnings and the Respondent should have been paying more attention to the Payor's books and records of account before relying only on the inaccurate QMP records.
[1738] The Appellant has established by a preponderance of evidence that he had no insurable earnings with the Payor for the 1992 year.
[1739] The Appellant has established by a preponderance of evidence that his insurable earnings are those described in his record of employment issued for 1993 by the accountant according to the records kept under section 77 of the Regulations.
[1740] This appeal must be allowed.
14. Elmer Lewis
[1741] The Appellant, Elmer Lewis, through counsel, in appeal No. 97-706(UI), as to paragraph 7, admitted the allegations in subparagraphs a) to c), e), h) and j). The allegations in subparagraphs d), f), g), i) and k) were denied but disproven by the evidence.
[1742] This witness was heard on January 26, 1999. The Exhibits which relate to this Appellant are B-16, B-16-1 to B-16-3, R-4, tab. 5 and T-20, p. 89. He was interviewed on March 2, 1995 by Lew Stevenson.
[1743] In 1993, he had a clam harvester and a licence to operate it, (Exhibit B-16, tab. 10).
[1744] He stated that he had a record of two sales with the Payor in 1993, but that one of these, he did not think was his but belonged to his wife Elizabeth because they used to deliver together.
[1745] He believed there was a mistake somewhere but did not notice it until it was too late. His wife did not notice it either.
[1746] He delivered clams to the Payor on July 9, 1993 as shown on the fisherperson's declaration, (Exhibit B-16, tab. 4). He explained how he harvested his clams, how they were delivered in ship to shore boxes and that he would be paid more because there was no sand in them. He said that he fished in a restricted area. When he delivered his clams that day in July of 1993, he thinks his wife also delivered a similar amount but it is a long time ago.
[1747] In 1993, he had nine weeks of insurable earnings with Leslie Hardy. He sold oysters and his stamps were averaged. He was paid in cash by the Payor. When he was paid would he usually receive a DFO slip.
[1748] He said he would keep the clams in the water 2 to 4 days.
[1749] In cross-examination, he identified his record of employment with the Payor (Exhibit R-4, tab. 5, p. 16). He was shown that two deliveries were indicated on July 10 and 17, 1993. He said that one of these was incorrect and belongs to his wife. He admitted he drew unemployment on it but did not realize it till after the fact.
[1750] He was asked to look at two DFO slips in the respective amounts of $750.00 (Exhibits R-4, tab. 5, p. 19 and R-5, tab. 7, p. 23). The former is in his name and the latter is in his wife's name. He did not share his catch with his wife or his son. He explained how it would be that his catch and that of his wife would be exactly the same amount. They could be exactly for the same weight given a pound or two.
[1751] He explained that he had been fishing for fifty years and a few cents one way or the other does not matter to him. He admitted that there was no indication on his DFO slip where the delivery was fished and that there was a note on the slip "no 25%". He said that 25% should have been taken off because he used a mechanical harvester. He said he had no education and was not very sharp at noticing those things.
[1752] He said that his wife used a mechanical harvester. He was shown his wife's DFO slips, (Exhibit R-5, tab. 7, p. 23). He said sometimes she did not use the mechanical harvester, she would dig by hand and she went on her own. On her DFO slip it is also marked "no 25%". He replied that she could have dug them by hand.
[1753] In 1993, he believes he made one delivery to the Payor. He kept only his DFO slips as records when he delivered to the Payor and that is all he ever kept for years of fishing.
[1754] He realized there was a mistake with respect to the delivery dates on his record of employment when he met with Lew Stevenson and it was pointed out to him. He started looking over his papers. He wanted to go back for another interview, but the investigator never got back to him to set a date.
[1755] The Appellant stated he was pretty upset at Lew Stevenson who had called him a liar. He signed his statement because he was told he had to sign it. He told the investigator he could not read what he wrote down. He said he should never have signed it. He was shown his questionnaire (Exhibit R-4, tab. 5, p. 23) and said he signed this document but had help to fill it out. He could not have done it on his own. He explained some answers in the questionnaire. He did not know if the maximum insurable earnings for 1993 were $745.00 weekly. He explained how when fishing oysters he piled them up and gathered them to make sure he had a full week of earnings and stated that all fishermen do that.
[1756] His arrangement with Leslie Hardy & Sons was different than with the Payor.
[1757] Here, we have an Appellant, whose name did not show up in the QMP scribbler for 1993.
[1758] The Appeals Officer, Lynn Loftus, was heard on April 9, 1999. She stated that although the worker used specialized gear in making the catch, there is no evidence to show the worker made any delivery or was paid for a catch by the Payor
[1759] She also said that doubt was cast upon the DFO slips of the Payor. She also stated that there is an element of scepticism on the DFO slip issued for July 9, 1993 as the information recorded therein shows the DFO slip to be in sequence with one belonging to his spouse and each of the slips were issued for an exact same amount of 750 pounds of clams. It is highly unlikely that both the worker and his spouse would deliver an exact amount of 750 pounds with no variance whatsoever.
[1760] The amounts delivered were explained by Mr. Lewis and he never said that their was no variance whatsoever. He said that there could be even number of dollars on two DFO slips delivered on the same day but in his own way he explained the give and take of the cents and pounds between buyers and fishermen when delivering.
[1761] The evidence was that the amounts were rounded out to the dollar and there could be a difference of a pound or so. It would work in favour of a buyer on one occasion and of the fishermen on the other. This was not a consistent occurrence demonstrating wrongdoing or the inflation of DFO slips. It was a common practice of give and take in the market-place.
[1762] Furthermore, the Appeals Officer concluded that the Appellant used specialized gear in making the catch and she believed he fished and delivered to Sharbell's but disallowed the DFO slip. That certainly appears to be contradictory.
[1763] The only logical conclusion would be that the Appellant made the deliveries as the Court has accepted as the only acceptable conclusion in this case and the Court has been given no facts to disbelieve this man.
[1764] This Appellant was truthful and his evidence was not contradicted.
[1765] The explanation in my view as to how a mistake could occur when a husband and wife are delivering together, is conceivable.
[1766] If we examine the documents, the Appellant should have signed one declaration (Exhibit B-16, tab. 4, p. 11) on July 9, which is the same day the DFO slip No. 0331502 was made out. In the pay records of the Payor for the Appellant (Exhibit B-16, tab. 4, p. 10) it reveals two DFO numbers: D3331502 and D331501. The DFO No. D331501 which is found in Exhibit R-5, tab. 7, p. 23, is made out to his wife with her social insurance number.
[1767] However when examining closely the two names, one may realize that at first glance the surnames written on the two slips "Elmer" and "Elizabeth" could look alike and be put under one name by the accountant which seems to be what happened here.
[1768] This was confirmed by the Appeals Officer at page 6 of B-16-1, where she noted that it was evident that the DFO slip of the worker's spouse, was recorded in error to the worker's summary sheet. In fact the Appellant did actually receive a T4F for 1993 with gross earnings of $1,500.00 from the Payor.
[1769] Nothing demonstrated that the Appellant or his wife would have participated in falsifying either the DFO slip or the record of employment or made false statements in relation to any claim for unemployment insurance purposes.
[1770] The Appellant has established by a preponderance of evidence that his insurable earnings are those described in his record of employment issued for 1993 by the accountant according to the records kept under section 77 of the Regulations.
[1771] This appeal must be allowed.
15. Maureen Costain
[1772] The Appellant, Maureen Costain, through counsel, in appeal No. 97-1674(UI), as to paragraph 4 admitted the allegations in subparagraphs a) to c), e), h), i) and k). The allegations in subparagraphs d), f), g), j) and l) were denied and disproven by the evidence.
[1773] This Appellant testified on January 26, 1999. The exhibits relating to her case in particular are B-10, B-10-1, B-10-2 and R-4, tab. 4.
[1774] This Appellant worked for Westech Agriculture Limited (Westeck), as a labourer from July 12 to August 7, 1993 (Exhibit B-10, tab. 1). She also worked for Owen Costain from August 9 to August 28, 1993 (Exhibit B-10, tab. 1, p. 2). She also dug clams and sold them to the Payor from July 17 to August 7, 1993.
[1775] She was asked how she could be working at Westech and dig clams at the same time. She explained that when she worked for Westech, she would start at 6:00 am and would probably finish around 1:30 or 2:00 o'clock in the afternoon. It is after that time that she would go to dig clams till whatever time she could. It was in July and a good way to cool off. She would deliver her clams daily, she would receive a weigh slip that she kept till the end of the week at which time she was paid in cash. She signed a declaration and was given a DFO slip.
[1776] She attended an interview with investigators Joe Pierce and Charlene Kelly on June 22, 1995. She told them what she told the Court: she had a fishing licence, a clam licence and a commercial fishing licence. She told the investigators the same thing she had told the Rulings Officer in his questionnaire.
[1777] The day she went to her interview was the first time she heard of QMP scribblers and she was told that her name did not appear in the scribblers. She was surprised. She would deliver 150 to 160 pounds a week. She delivered each day and was paid at the end of the week and received her DFO slip at the same time. She never took any money during the week. She just took the weight slips she showed the Court what these slips looked like, (Exhibit R-4, tab. 4, p. 23). These slips did not belong to her but were similar to what she would receive when she delivered her catch. She kept her weight slips at home and would count them up before she went to get paid at the end of the week. Then she threw them away. She received her DFO slips and said that there was never a discrepancy in the weights. She identified her declarations and her DFO slips (Exhibit B-10, tab. 5).
[1778] In cross-examination, she was asked to explain how she dug clams.
[1779] She explained how she obtained the weight slips that are found in Exhibit R-4, tab.4, p.23. She kept her "weight slips" till the end of the week and she made sure she was given the proper amount of money for what she delivered and would throw the slips away.
[1780] She fished quahaugs for only one week because it was heavy lifting.
[1781] She was asked why on a DFO slip dated July 16, 1993, there was no indication as to where the fish was landed. She said that as far as she could remember the information was not given each time and that it did not seem like a big issue to her.
[1782] She explained why she did not continue fishing with her husband.
[1783] She explained how she had a total of ten weeks of insurable earnings and that she would work extra to earn extra cash and top up her earnings for certain weeks. She did all her deliveries by herself.
[1784] She explained that she signed her declaration on the same day she received her DFO slip.
[1785] She did not know whether she received a copy of the fisherperson's declaration but that she kept her DFO papers. She never really checked the dates on her DFO slips as long as they matched her records of employment. She did not know why her DFO slips were so closely numbered. She did not imagine that the Payor had a book in her name because she was not a full-time salesman. She said she delivered to the Payor in 1992, and she had no problem with her 1992 claim. She had no idea whether her name was in the QMP scribbler in 1992. She said that her DFO slips are accurate because she trusted Dale Sharbell that he was doing the right thing.
[1786] She kept her weight slips till the end of the week and took her DFO slips home.
[1787] She had no records of the days she fished or the dates of delivery, she never thought of keeping them and had not done so previously. All that mattered was that she was bringing home dollars.
[1788] She admitted that now it appeared reasonable to keep records of what she sold and that the hearing will probably be a lesson well learned for everybody.
[1789] She did not know how she recorded her fishing income in 1993, but she would have declared all her income under T4 earnings. The only expenses she would have had was gasoline.
[1790] She explained how she relied on unemployment insurance and that now she works at another job and she does not expect to rely on seasonal benefits anymore. She was not allowed any earnings by Revenue Canada because her name was not in the Payor's QMP scribbler for 1993.
[1791] The Appeals Officer, Elizabeth White, was heard as a witness on December 2, 1999. The Officer admitted that she applied the master file in the cases of Dale and Sandra Rafferty and Wayne Milligan.
[1792] She was then asked what she did in the case of this Appellant? The Officer allocated no weeks or earnings to the Appellant based on the credibility of the QMP scribblers (Exhibit B-10, tab. 7, p. 29) although she had the DFO slips and declarations of this Appellant (Exhibit B-10, tab. 5). No evidence showed that the Appeals Officer would have contacted either Dale Sharbell or Martin Smith in relation to this Appellant's fishing.
[1793] This Appellant relied on her DFO slips as would be expected according to the evidence. She was truthful and her evidence was not contradicted.
[1794] No evidence was shown that she participated in anyway in falsifying her DFO slips or her record of employment. She had nothing to do with the records of the Payor. Her evidence is to the effect that she honestly believed that the only documents she needed to keep were her DFO slips.
[1795] In this case there are, in addition, fisherpersons' declarations which confirm her deliveries. The fact that she kept no other records but her DFO slips is not evidence that she did not fish or make the deliveries.
[1796] This person fished and delivered her catches in order to top up her earnings for certain weeks of employment she had with another payor. It appears that in this area certain people made their earnings from fishing only. Others worked as labourers or did other duties and combined that type of work with fishing. The fishing part of their earnings were as self-employed fisherpersons. This situation does not mean that they did not fish and deliver to the Payor.
[1797] The Appellant has established by a preponderance of evidence that her insurable earnings are those described in her record of employment issued for 1993 by the accountant according to the records kept under section 77 of the Regulations.
[1798] This appeal must be allowed.
16. Wayne Milligan
[1799] The Appellant, Wayne Milligan, through counsel, in appeal No. 97-1673(UI), as to paragraph 4, admitted the allegations in subparagraphs a) to c), e) and h) to k). The allegations in subparagraphs d), f), g) and l) were denied and disproven by the evidence.
[1800] This Appellant testified on January 26, 1999. The exhibits of interest to this witness in particular may be found in B-9, B-9-1, B-9-2 and R-6, tab. 12.
[1801] This Appellant had a licence to fish eels clams and quahaughs. He fished in Hardy's Channel and Linkletter.
[1802] In 1993, he also worked with the Department of Transport as a labourer. He worked at that job from 7:00 a.m. to 3:45 p.m., Monday to Friday. He fished clams in the evenings, on Saturdays and holidays and he made his deliveries to the Payor. He delivered mostly once a week and received his DFO slip.
[1803] He was questioned by his lawyer as to the interview that took place with the investigators on June 20, 1995. He was shown the DFO slips and the fisherperson's declarations (Exhibit B-9, tab. 3). He identified the Exhibits. He explained that he fished after work with a plunger. His DFO slips were made out when he delivered his catch and he was paid at the same time. When he dug his clams, he would off load them in wooden crates. The sales were made in order to boost his benefits. It allowed him to make some extra money. The DFO slips he received corresponded to what he sold. He fished in 1992 and that year was not the subject of an appeal.
[1804] He was cross-examined. He said that he filled out the declaration in Exhibit B-9, tab. 3. Two of the eight fisherperson's declarations are not signed by the buyer. Even though they were not signed by Dale Sharbell, he must have been present because the witness was paid. He said that if he had not been paid he would not have left the premises.
[1805] He fished alone. He explained that he fished the same weeks he worked for the Department of Transport, because if he left the fishing too late in the fall the weather could have been bad and cooler.
[1806] The buyer would know whether to take off the boat share or not because the witness presumed that he gave that information to the buyer
[1807] He delivered his catch in plastic fish pans. His unemployment insurance deductions were taken off when he was paid. He did not keep a record of what was taken off for unemployment insurance deductions.
[1808] He identified his income tax return for 1993. He had gross earnings of $3,429.75 and net earnings of $494.27. He said he required ten insurable weeks in order to be eligible for unemployment insurance benefits. He said he did not keep any other records but his DFO slips. He did not record anywhere the dates that he fished or the earnings he made on a daily basis. He was shown a DFO slip (Exhibit B-9, tab. 3, p. 7), where no indication is made as to where the fish was landed. He said that he presumed he told Dale Sharbell; it being six years ago, he could not remember all those details. He said that Foxley River or Hardy's Channel where he fished is really in fact all the same place.
[1809] An inter-office memo indicates that the investigator Joe Pierce on February 14, 1996, questioned the Rulings Officer's decision as to why the Appellant was given two weeks of insurable employment. The answer of the Appeals Officer is dated February 22, 1996.
[1810] The Appeals Officer, Elizabeth White, was heard on December 1, 1999. She was asked what she made of a two-way office memo in the file of this Appellant (Exhibit B-9, tab. 6). The memo was issued on February 14, 1996 by Joe Pierce of HRDC to Gary Robbins of Revenue Canada. HRDC was inquiring about two insurable weeks given to the Appellant by the Respondent although the name of the Appellant did not appear in the daily delivery records (QMP) of the Payor for 1993. Gary Robbins replied on February 22, 1996, indicating why the Appellant was ruled upon as he was.
[1811] The Appeals Officer stated that such a memo is not a frequent occurrence.
[1812] She was asked whether the statement of the Appellant (Exhibit B-9, tab. 5) was in her file at the appeals stage. She said she had read it. She did not have the two last pages numbered 37 and 38 in Exhibit B-9, tab. 5.
[1813] The Appellant's statement was not in the Appeals Officer's file the day of the hearing.
[1814] She said that the Rulings Officer's report was in the Respondent's file. The Rulings Officer would not have made reference in his report of the Appellant's interview. The Rulings Officer made reference to the Appellant's questionnaire and the QMP scribblers.
[1815] The Appeals Officer said that the Appellant returned her a questionnaire in which he would have stated not having signed a declaration. When she was shown Exhibit B-9, tab. 3, she admitted that all the fishermen's declarations are signed. The declarations are signed and bear the same dates as those on the DFO slips in the possession of the Appellant. Then the Appeals Officer admitted that she never looked at what was said at the interview of the Appellant (Exhibit B-9, tab. 5).
[1816] The Appeals Officer admitted she did not call the Appellant to ask any clarification of questions she may have had. She did not contact Dale Sharbell or any of his employees to find out whether they would have bought product from the Appellant. She relied on the information in the master file. She said that as Appeals Officers they had a policy whereby if the QMP scribbler was correct the onus shifted to the Appellant. She stated that she always tried to pay attention to the individual and not use the master file blindly, but she never overruled the master file when it proved to be correct.
[1817] At times if a person's name was not in the QMP scribbler and it had been proven that that person had fished she would give a minimum week, but not in accordance with the amount of fish recorded on the DFO slip. In the case of the Appellant she said it was not whether she believed him or not, "variables didn't swing on his side". The use of the master file was relied upon as one of the variables. If she disagreed with the QMP scribbler she awarded a minimum week.
[1818] From seeing and hearing this Appellant, he gave a truthful account of what he did. He was not contradicted. He relied on his DFO slips as his receipts for fishing. No evidence indicated that he would have participated in falsifying his DFO slips or his record of employment or would have made false statements to the Respondent in order to qualify for benefits.
[1819] The Appellant has established by a preponderance of evidence that his insurable earnings are those described in his record of employment issued for 1993 by the accountant according to the records kept under section 77 of the Regulations.
[1820] This appeal must be granted.
17. Paul Sharpe
[1821] The Appellant, Paul Sharpe, through counsel, in appeal No. 97-579(UI), as to paragraph 6, admitted the allegations in subparagraphs a) to c), e) and i) to k). The allegation in subparagraph h) was admitted with further explanations to be given at the hearing. The allegations in subparagraphs d), f), g) and l) were denied and disproven by the evidence.
[1822] This witness was heard on January 27, 1999. The exhibits that relate to this Appellant in particular are B-14, B-14-1 to B-14-3 and R-6, tab. 15.
[1823] This Appellant worked as a fisherman's helper for West Shore Fisheries from August to October of 1993. He sold eels to the Payor. Two DFO slips were filed (Exhibit R-6, tab. 15, pp. 10 and 11). The DFO slip No. E327854 shows a delivery on May 28 1993. The DFO slip No. B352099 shows a delivery on October 2, 1993. This last DFO slip has an indication "no stamp". The Appellant explained that he thought that before he could be eligible for a stamp he would have to have $150.00 worth of fish.
[1824] In the year 1992, his delivery was accepted and he is only appealing the 1993 year.
[1825] He filled out a questionnaire in which he only declared the delivery he made in May of 1993. He said that the October delivery slipped his mind. He said he received a DFO slip for his deliveries and signed a declaration.
[1826] His lawyer questioned him about the Appeals Officers' report and some of the facts contained in the summary. He explained that the expenses he incurred in buying a dory and his gas receipts were required because of work he had to accomplish on the fishing leases that his father had left him. These fishing leases had been neglected by his father who was not in good health. The leases were, however, not transferred into his name until 1994. He did buy, in 1993, eight leases buoys and lease markers (Exhibit R-6, tab. 15, p. 20). He also bought a dory and tongs in the last part of June 1993.
[1827] He stated he knew nothing about the QMP scribblers and that his two DFO slips for May 28 and October 2, 1993, were accurate. The only documents he received or kept are DFO slips from the buyer.
[1828] In cross-examination, it was suggested to him that since the DFO slip of October 2, 1993, was not reflected on his record of employment, this last document would be inaccurate. He said that he did not think a delivery was put on the record of employment if the DFO slip indicated "no stamp".
[1829] He was shown the fisherperson's declaration (Exhibit R-6, tab. 15, p. 9) dated May 25, 1993 and then asked where the DFO slip was for that date. He explained that there must have been a mistake on the declaration since he delivered on May 28, 1993. He is positive that he did not make a delivery on one day and go back three days later to get his DFO slip.
[1830] He said his father left him his fishing leases in 1992 or 1993. He did not have them all transferred in his name because he could not afford it at the time. He explained his gas receipts and the necessity for consuming gas. He said that he saved all his receipts and gave them to his accountant.
[1831] The Court put several questions to the witness in relation to his employment and his earnings. The witness reiterated that a delivery of $128.00 would not be considered for his record of employment but would be included as earnings in his T4 slip for income tax purposes. He said that it was the buyer that decided whether a delivery would be considered as insurable earnings for a fisherperson. He also said that he would have to have a delivery of a minimum of $149.00 to get a stamp or a week of insurable earnings.
[1832] The Appeals Officer, Rosemarie Ford, was heard in this appeal on April 8, 1999.
[1833] The Appeals Officer had concluded that it was not reasonable to believe that the Appellant would fish for only one week during the fishing season and then do nothing else as there was no evidence of him having other work or income.
[1834] She wanted to know from the Appellant what he was doing because his name was in the QMP scribbler.
[1835] It was suggested to the Appeals Officer that since the Appellant had bought a boat and tongs it could be that he was interested in the oysters industry and if he was working on his lease he would need gas to run an outboard motor. She replied that she did not think much about it but agreed that he would require gas to work on his lease.
[1836] Her second assumption was that it is known that fishermen do and can sell their catch for cash if they do not require or want any insurable week.
[1837] She assumed that if he was claiming expenses for gas he was fishing. She said that apparently if the Appellant had been working on a lease, he could have claimed fishing expenses. She was not told that he was working on a lease and she thought that fishermen could only claim expenses at the time they were receiving income. The Appellant provided all his expense sheets.
[1838] When she reviewed the receipts, she noted several for gas in June of 1993. If he was not fishing he would not need gas for his truck or boat and according to the QMP scribbler he would have made deliveries every week. She did not know he was working on his lease.
[1839] The Appeals Officer admitted that she contacted the Appellant once when she sent out the questionnaire. She did not contact the Appellant to verify her assumptions but in the questionnaire the Appellant did not say he was working on his lease.
[1840] In re-direct examination, she was asked what it would take to change a ruling decision that was made when the appeal came to her? She replied that she required some kind of information that would show that the fisherperson was working somewhere else or fishing somewhere else or that it was impossible for the fishermen to be selling to Sharbell's at that time. She also said that no information of that nature was provided by the Appellant in this case.
[1841] This Appellant gave a truthful account of what he did. He was not contradicted.
[1842] The explanation given as to his purchases and expenses were acceptable. The Appeals Officer relied only on the answers in the questionnaire and assumed the Appellant was fishing for cash which was disproved by the Appellant in his explanation.
[1843] Nothing in the evidence would permit to conclude that this Appellant would have participated in falsifying his DFO slips or his record of employment or would have made false statements in order to be eligible for benefits. He knew nothing of the QMP scribblers and took no part in their making.
[1844] The Appellant has established by a preponderance of evidence that his insurable earnings are those described in his record of employment issued for 1993 by the accountant according to the records kept under section 77 of the Regulations.
[1845] This appeal must be allowed.
18. Myles Smith
[1846] The Appellant, Myles Smith, through counsel, in appeal No. 96-2398(UI), as to paragraph 6, admitted the allegations in subparagraphs a) to c), e) and h) to l). The allegations in subparagraphs d), f), g), m) and o) were denied and disproven by the evidence.
[1847] This witness was heard on January 27 and 28, 1999. The exhibits that are of interest to this Appellant, in particular, are B-7, B-7-1 to B-7-25, R-7. This witness showed to the Court a series of diaries (Exhibit R-26), for the years 1992, 1993, 1995 and 1996, which were given back to the witness on consent at the hearing.
[1848] This Appellant has been fishing since 1985 and fishes all types of shellfish.
[1849] He delivered his product to buyers in 1992 and 1993. In 1992, he delivered to the Payor from May to October. In 1993, he delivered to the Payor from about May until September and to French River Cannery from July till the end of August.
[1850] He first heard of this investigation when he attended an interview. He was asked to bring all receipts pertaining to this enquiry for 1992 and 1993. He met with Mr. Stevenson and another gentleman he could not identify. He was shown for a moment a page in a QMP scribbler which had his name and the name of Kevin Penwarden on it. He could not explain why it was made out that way. He had never seen the QMP scribblers before the interview. He submitted all his papers, his fishing records and his income tax papers which were photocopied.
[1851] He was shown the DFO slips in his name, Exhibit R-7, tab. 17) and the identified them. He never saw the QMP records when he sold to the Payor. He did not know why his name and that of Kevin Penwarden were on the same page of a QMP scribbler at the Payor's premises. After the interview with Mr. Stevenson, he asked Martin Smith (his brother), who could not tell him either. He spoke to Dale Sharbell who told him that the QMP's did not mean anything, that they were just for DFO purposes.
[1852] He explained how he fished eels and stated that he had two boats. He filed exhibits showing the boat (one with which he fished eels and the other one with which he fished oysters) (Exhibits B-7-1 to B-7-5).
[1853] He was further examined on January 28, 1999. He stated he had four insurable weeks in 1993 with the Payor. He identified the DFO slips in his name and he explained that there was no declaration for his delivery of May 22, 1993, because the declarations were verbal at the time.
[1854] He provided a weekly diary to Revenue Canada (Exhibit B-7, tab. 5, pp. 28 to 118). He explained that he kept a log of what he did. He also had an expense book (Exhibit R-7, tab. 17). In going through the diary the witness explains it would be possible to see what took place, where he fished, the days he fished and/or delivered his catch. He provided to Revenue Canada the diary and expense sheet and he was never asked any questions about them.
[1855] He explained how he fished and delivered his catch. When he had enough fish for a sale he took it to the Payor, was given a slip of paper at the scales, he then proceeded to the store and would be paid. The unemployment insurance deductions were taken off.
[1856] In 1992, he would make a verbal declaration regarding his catch. In 1993, he signed a written declaration. The DFO slips were made out and given to him
[1857] Before he delivered his catch he would weigh it on an old set of scales he had at his home. He wanted to make sure that he would have enough fish for a maximum stamp or a maximum insurable week.
[1858] He never delivered someone else's catch and no one delivered his. He kept records of his fishing to maximise it. He filed a letter he sent to his member of Parliament (Exhibit B-7-6), on June 11, 1993. At the time the Appellant was using a snorkel when picking bar clams and he had heard that the government was contemplating removing the licensing for this type of fishing.
[1859] He explained how snorkel fishing was carried out by filing a series of photographs (Exhibits B-7-5 to B-7-22), which show the area where he fished and the equipment used.
[1860] He was shown the Appeals Officer's report (Exhibit B-7, tab. 7). He understood from the ruling that the QMP scribblers are at times accurate and at other times they are not and he could not say where the Minister obtained his numbers.
[1861] In 1992, the Minister took away one week of insurable earnings which disqualified him for that year. In 1993, he did not sell any bar clams to the Payor, but he was awarded sales by the Minister. The Minister did not accept the diary and he was never asked any questions about the diaries. He received a questionnaire from the Appeals Officer, Patricia Griffin, which he answered. He photocopied his diary and sent it to Revenue Canada along with his expense sheet.
[1862] He said that he fished in the same area as Kevin Penwarden. There was nothing to prevent him for fishing in that area. He explained that he and Kevin Penwarden delivered their catches together on many occasions. They would help each other weighing their catches at the Appellant's place. They would load up their trucks and often met at the Payor's place around the same time.
[1863] He was shown the pages of the QMP scribbler (Exhibit R-7, tab. 17, pp. 23, 25, 39 and 44). He said that he provided his log books which matched his expense sheet and this sheet matches his income tax records. He does not know what else he can do. At the time of his sales all he was given were his DFO slips and, to this day, that is all he received from his buyers and he said that he had not heard that he was required to "assess in our own records". He said he fished in his own boat and he never shared a catch with another person and no one helped him pay his expenses.
[1864] He was cross-examined as to the dates on the DFO slips and the dates on his records of employment. The witness said that the dates on the DFO's are the dates he delivered his catches to the Payor.
[1865] He was asked several questions regarding his deliveries compared to the deliveries made by Kevin Penwarden. He said that they fished the same area and delivered together but he never shared his catch.
[1866] He knew his brother, Martin Smith, worked at the Payor's place. He did not know at the time that his brother worked on the Payor's QMP scribblers. He was under the impression that his brother worked at the scales and pumping gas.
[1867] He was then shown a series of documents, his records of employment, DFO slips, fisherperson's declarations. He identified his brother's writing on some of the documents.
[1868] The Respondent had the witness file three DFO slips made out in the name of Kevin Penwarden (Exhibit R-24). The witness was asked several questions as to the dates and quantities of fish shown on these DFO slips compared to the dates and quantities of fish on the DFO slips made out to him. He was cross-examined with the answers he gave in the questionnaire (Exhibit R-7, tab. 17, p. 49). When asked about certain answers dealing with what he sold the Payor, he said that his diary would show what he sold the Payor. Several questions were then put to the witness as to the existence of his diaries. He was asked to bring in for the next day his diaries for 1990 to 1994. He stated that he made recordings in his diaries when he was home after fishing.
[1869] He was questioned at length with regard to his fishing, his deliveries, how he kept the fish before delivery, at what distance he lived in relation to several places including the Payor's premises. He was shown a couple of DFO slips (Exhibit R-7, tab. 17, p. 9), and said that there was no indication on the slips that a boat was used in making that catches. He said that unemployment insurance premiums would be deducted when he received his DFO slip.
[1870] It was suggested to the witness that his diaries for 1992 and 1993 match what is recorded on his DFO slips, because he would have made his diary at a later date so that it would correspond to what was on his record of employment. In answer to this question, he said that the Minister's allegation was wrong.
[1871] The Respondent filed the Appeals Officer's report as Exhibit R-25 dated October 21, 1996. It was pointed out that some of the printing on this document could not be easily read. The Appellant read part of the Appeals Officer's report which made reference to the fact that Kevin Penwarden did not appeal the ruling made by Revenue Canada. The Appellant stated that Kevin Penwarden had a penalty of $1,200.00 and as his wife was diagnosed with a sickness, it would cost more to fight the appeal.
[1872] In answer to questions put by the Court, the Appellant said that his understanding of a minimum stamp was that a fisherman had to make a minimum of $149.00 of sales in order to obtain one insurable week for unemployment insurance purposes. However, even if the amount of the sales for a week was less than $149.00, they would be considered as earnings for the fisherman.
[1873] He was cross-examined further on January 29, 1999, when he brought to the Court his diaries for 1992 1993, 1995, 1997 and 1998.
[1874] The Appeals Officer, Patricia Griffin, was heard on November 29, 1999.
[1875] She said that for the 1992 year, she confirmed every week on the Payor's record of employment except one because the Payor's QMP scribblers were "not reliable for that point and time".
[1876] She admitted that the Appellant may as well not have put in his diary to the Respondent because she did not rely on his diaries. When she saw the QMP scribblers, she noted that the Appellant's name was on the same page as that of another fisherman, Kevin Penwarden. She concluded that they fished and sold together and were splitting the catches. She also concluded that there were so many coincidences that the QMP scribblers had to be correct.
[1877] She never called Martin Smith who had prepared the scribblers and she never talked to Kevin Penwarden or Dale Sharbell or the Appellant about the question she was having. She was not sure whether she had checked the Appellant's diaries to see what he had done during the week of fishing that she disallowed. She admitted that she had never asked the Appellant if he had fished with Kevin Penwarden but should have done so.
[1878] She could not recall on what basis she had overruled the Rulings Officer, in other appeals.
[1879] For the 1993 year, she did not accept the Appellant's diary or the ROE because "I went with what the QMP stated, I went with somebody else's recommendation whether they were reliable or not". She admitted that the Appellant probably did not know what she was trying to get at or to find out.
[1880] The conclusion reached by the Appeals Officer was that the Appellant and Kevin Penwarden fished together and she did not ask any questions to verify her conclusions.
[1881] She also admitted that she did not do a reconciliation of all the Appellant's DFO slips, diaries and expenses for 1992 and 1993. In fact, she admitted not having considered the Appellant's submissions. There was no attempt to clarify any of the questions raised as a result of her looking at the Appellant's file. She did not call Kevin Penwarden because he never appealed the rulings decision and she was not concerned about his case.
[1882] In re-examination, her attention was drawn to the DFO slips, which were numerically numbered in consecutive order at Exhibit R-7, tab.17, pp. 9 to 23. She said that she was trying to find out whether the Appellant and Kevin Penwarden were fishing together. She did not believe the declaration of the Appellant where he stated he had fished alone. She said that there were too many coincidences to have DFO's like those she saw. She did not give much weight to the Appellant' diaries. She stated that the Appellant had provided the diaries at the appeal stage and wondered why they were not provided before.
[1883] This Appellant gave a full and honest account of what he did. He was not contradicted. Nothing in the evidence showed that he would have participated in sharing his catch with Kevin Penwarden. It is accepted that they both fished in the same area, they helped each other out and delivered several times together. This situation would certainly not be unusual. In fact, the snorkel fishing they were both carrying out would appear to be risky work especially if carried out for long hours and for two fishermen to work together in the same area would be more secure than fishing alone.
[1884] The Respondent's conclusion that the diaries were a recent fabrication was supported by no evidence.
[1885] The case of this Appellant was an unequivocal demonstration of how the Appeals Officers proceeded not to accept any explanation from the Appellant which would deviate from the predetermined conclusion arrived at as to the reliability of the QMP scribblers, prior to interviewing any Appellants.
[1886] No evidence showed that this Appellant would have participated in falsifying a DFO slip or a record or employment or made false statements in order to be eligible for unemployment insurance benefits.
[1887] The Appellant has established by a preponderance of evidence that his insurable earnings are those described in his record of employment issued for 1992 and 1993 by the bookkeeper or accountant according to the records kept under section 77 of the Regulations.
[1888] This appeal must be allowed.
19. Elizabeth Lewis
[1889] The Appellant, Elizabeth Lewis, through counsel, in appeal No. 97-578(UI), as to paragraph 6 admitted the allegations in subparagraphs a) to c), e), h) and j) to l). The allegation in subparagraph i) was admitted with further explanations to be given at the hearing. The allegations in subparagraphs d), f), g), m) and n) were denied and disproven by the evidence.
[1890] This witness testified on March 1, 1999. The exhibits that are of particular interest to this Appellant are found in B-13, B-13-1 to B-13-3 and R-5, tab. 7.
[1891] The direct examination of this witness began with the filing of an affidavit (Exhibit B-13-1).
[1892] In 1992, she fished clams and sold them to the Payor. She received a record of employment with eight weeks of insurable earnings. The Minister disallowed the weeks of July 18 and 25, because her name did not appear in the QMP scribbler.
[1893] In cross-examination, she stated that she fished clams in 1992, that she fished clams and eels in 1992 and 1993 and that she fished alone.
[1894] She did use a mechanical harvester in 1992. She explained its use.
[1895] She could not recall what declaration she made or what was done in relation to the deduction of 25% for the use of a boat or specialized equipment. She did not always use a mechanical harvester when she fished clams. She sometimes dug them by hand. She made her own deliveries and made no deliveries for others. She made her deliveries two or three times a week. She would get paid most times when she made her deliveries, if not she was paid at the end of the week. She never sent anybody else to pick up her money. She did not pick up DFO slips for someone else.
[1896] The unemployment insurance deductions were taken off at the end of the week. She did not have a record of that. She received her DFO slip at the end of the week. In 1992, she made verbal declarations and they could have been made at the end of the week.
[1897] She dropped her appeal for 1993 because it seemed all right. She could not recall if in 1993 she was given two extra weeks. She could not answer as to what the Minister did to her claim for 1993, because she did not have all her papers in front of her, but does recall that there was an error on one of her DFO slips. A list of DFO slips was produced by the Respondent (Exhibit R-27).
[1898] She picked up her DFO slips at the end of each week she sold fish and most of them were written out by Dale Sharbell. She could not recall whether Martin Smith wrote out any. She did not know why the serial numbers on the DFO slips for July 18 and 24 were consecutive. She said that she did not know what books the Payor used and had no idea why the DFO slips would be consecutive.
[1899] She did admit that she received a DFO slip that was mistakenly put on her husband's record of employment while it should have been reflected on hers. As a consequence she said her record of employment would not reflect all she fished in 1993. She was willing to accept what the Payor gave her for that year. She did not fish with her husband Elmer and did not share a catch with him. She might have delivered on the same day as her husband but she delivered her own fish. She knew what fish was hers from the way the pans were placed in the truck.
[1900] She knows that Elmer Lewis fished in 1992 and 1993 and sold to the Payor. She could not recall why she did not start fishing sooner. She sold oysters to Leslie Hardy & Sons Ltd. She required ten weeks and she had her ten weeks. She could not recall why she did not fish beyond the required time.
[1901] She said that to prove her claim, she has her DFO slips.
[1902] She was asked if she had received other slips. She replied that when she sold her clams, she would be given a piece of paper with the amount of fish which she would take into the store and get paid or she brought it back at the end of the week. She did not keep the paper slip for a second week, because she did not think they were any good once she received her DFO slip. She did not keep a record of the days she fished. She and her husband had no other sources of income in 1992 and 1993, other than fishing income and unemployment insurance benefits.
[1903] The Appeals Officer, Lynn Loftus, was heard in this appeal on April 7 and 9, 1999.
[1904] The Appellant provided to the Appeals Officer eight DFO slips. Six of the slips were accepted and two were not. The two slips of July 18 and 24, 1992 were disallowed because the Appellant's name did not appear in the QMP scribbler as the Respondent had decided that the QMP scribblers were reliable for those weeks.
[1905] The Appeals Officer was asked how could the Appellant prove that she had fished. The Officer replied that the Appellant could have produced books and records of any kind, a diary, a journal, a calendar, something indicating dates, deposits at a bank on the dates she was making sales.
[1906] Then she was asked what she would want to find in a diary? She replied she would have wanted dates of delivery, amounts of pounds that were fished, the price that was paid, something along those lines (pp. 164, 165 of transcript of April 7, 1999).
[1907] Counsel for the Appellant then said to the Appeals Officer that the situation in the case of this Appellant was that she provided eight DFO slips, six of them were good and two of them are not. The officer replied that she did not say that the two were not any good but were not insurable but that they were still a "record of fish, that was ... They're a statistical page that's showing that there's fish being delivered" (p. 166 of transcript of April 7, 1999).
[1908] The Appeals Officer repeated that the Appellant should have been keeping all her expenses and that it would be reasonable that she would have kept a record of all her income as well. Since the doubt had been cast on the DFO slips for the weeks that were disallowed and the Appellant having no other records, she was not allowed insurable weeks.
[1909] In re-examination the Appeals Officer stated that the Fisherman's Regulations were to be interpreted narrowly on advice from the Respondent's Headquarters in the summer of 1996. She was asked whether there was anything else other than the Fisherman's Regulations that was going to be interpreted narrowly? Her answer was "what we were looking at, at their evidence at what they could produce, the records, the documentation". She also said that the evidence that was being provided from the fishers should have been interpreted narrowly (pp. 167 to 169 of transcript of April 9, 1999).
[1910] The Appeals Officer said that "what she required was anything at all that might be looked at and given some credibility something that we could give some credence to, something that would show how much was delivered or what date it was delivered on" (p. 136 of transcript of April 9, 1999). In fact, the end result was that the fisherman and his DFO slips were not enough.
[1911] Two witnesses testified on behalf of the Appellant.
[1912] Joseph Wendell Costain a retired fisheries officer was heard. He identified a mechanical harvester licence for Elmer Lewis. He never saw Betty Lewis operate a mechanical harvester. He saw Betty Lewis clam digging. In 1992, he bought clams from her.
[1913] In cross-examination, he stated he never issued a licence to Betty or Elizabeth Lewis. He did not know what exact dates she fished in 1992. He would not know how much she was paid for delivering fish to the Payor or when she received DFO slips from the Payor.
[1914] Susan Kinch saw Elizabeth Lewis at Sharbell's fish Mart in July of 1992, with a load of clams in a truck. Five hundred pounds of these clams were transferred from the truck of Elizabeth Lewis to the truck of the witness.
[1915] This Appellant gave a truthful account of what she could remember. She was not contradicted. No evidence showed that she would have participated in any way in falsifying her DFO slips or her record of employment or giving false statements in relation to any claim for unemployment insurance benefits. The Appeals Officer obviously required this person to make absolute proof of fishing and keeping of records which parliament never expected from fishermen as dealt with earlier in this Judgment.
[1916] The Appellant has established by a preponderance of evidence that her insurable earnings are those described in her record of employment issued for 1992 by the bookkeeper according to the records kept under section 77 of the Regulations. This was the only year, which remained under review.
[1917] This appeal must be allowed.
20. Claudette Gallant
[1918] This Appellant testified on March 1, 1999. The Appellant, Claudette Gallant, through counsel, in appeal No. 96-1566(UI), as to paragraph 8 of the Reply to the Notice of Appeal, admitted the allegations in subparagraphs a) to c), e) and h) to k). The allegations in subparagraphs d), f), g) and l) were denied and disproven by the evidence.
[1919] Exhibits R-28 and R-28-1 to R-28-10 were filed in the Court record.
[1920] The Appellant, in 1993 lived in St-Raphaël (P.E.I.). She is a fisherperson and has been fishing since 1989. She fished alone. He last year of fishing was 1995. She fished quahaugs most of the time. She also fished bar clams. She fished at West-River, Cherry Valley, Enmore, St-Nicholas and a location called "pig grounds". These areas can be found on a map which was filed (Exhibit R-28-6).
[1921] During the 1993 year, she sold her fish to the Payor. She also sold to Joe Caissie at Egmont Bay Seafoods. She never saw or discussed scribblers with anyone at Sharbell's Fish Mart. From her home in St-Raphaël to West-River near Charlottetown, the distance would be approximately a one-hour drive, from St-Raphaël to Summerside it would be about 13 miles and from her home to the Payor's establishment in West Portage (P.E.I.), it would be a half-hour drive.
[1922] She fished according to the tides book she had at home. She fished the best tide which was low tide. She never fished during high tide. She fished every day, morning, afternoon and at night after dark. She would fish until she had enough for the week. If she found good fishing in one area, she would stay, if not she went to another location. After fishing, she would stop at her home, count and divide her catch. She marked it in a book. If she had enough she would deliver, if not she kept her catch for a couple of days at her home in her cool basement. The small quahaugs were more valuable. She did not make a trip to deliver every day to the Payor, because it was too far from her home and she was concerned with the cost of fuel.
[1923] She also sold to Egmont Bay Seafoods and filed all her DFO slips for 1992 (Exhibit R-28-1). These slips, which she identified, indicate deliveries made from September 20 to December 17. When she delivered to Egmont Bay Seafoods, she was given a DFO slip at every delivery. The area fished in these DFO slips was mostly St-Nicholas, a few miles from her home and her home is six or seven miles away from Egmont Bay Seafoods.
[1924] The Appellant was shown a page from a QMP scribblers (Exhibit R-28, p. 21). This page indicates that on September 20, 1993, she would have been paid $18.90 by the Payor for a delivery of quahaugs. On that same day, a delivery slip was issued to the Appellant for a delivery of quahaughs at Egmont Bay Seafoods (Exhibit R28-1). The Appellant said that she did not deliver to the Payor during the same week she delivered to Egmont Bay Seafoods, because she would "not drive that far for eighteen dollars".
[1925] The Appellant was shown two DFO slips dated December 10 and 17, 1993 (Exhibit R-28-1). These two DFO slips were issued to the Appellant for deliveries that were actually made in September or October of 1993. She could not remember whether she made one or two deliveries at that time.
[1926] The Appellant filed a letter (Exhibit R-28-2) which indicated that she was admitted to the hospital on October 8, 1993. She did not fish or deliver any fish after that day.
[1927] After her stay in hospital, she would have contacted the employment office. From information obtained she contacted the Payor who issued two DFO slips and paid her in December, for deliveries she had made to the Payor prior to her hospitalization on October 8, 1993.
[1928] She stated that as far as she knew, these DFO slips were accepted and allowed by the Respondent as weeks of fishing (these dates of December were not in the scribbler and they were accepted). She said that when making her dealings with the Payor, she had to sign her name for some of the papers.
[1929] She was shown Exhibit R-28, pp. 14 and 15. These pages are documents entitled "Fisherperson's Declarations", dated December 10 and December 17, 1993 which she identified as being her signature. She could not recall who filled out the documents. She stated that for the Payor she signed a fishermen's declaration once a week. When she delivered to Egmont Bay Seafoods, she also signed a fishermen's declaration once a week.
[1930] She was not sure whether she ever made daily deliveries to the Payor. From what she remembers she delivered to the Payor every couple of days.
[1931] She was shown a DFO slip dated July 17, 1993 (Exhibit R-28-1). She explained that she was paid the amount of money indicated and that it was in accordance with what she delivered to the Payor because she kept her own records at home.
[1932] She said that after she fished, she would divide her quahaugs into small, medium and large and mark it in a note-book.
[1933] This is how she described what she did, "I would mark down just the letter "S" and then the medium and the large, then the amount what the dealer pays. And then I'd count how much I had and figure out roughly about how much I would get" (p. 103 of the transcript of March 1, 1999). She used a calculator to do her figuring. After the year was done she would throw her notebook away. To her knowledge her DFO slips were right. She never received a DFO slip if she did not make a delivery. There is no inscription in the QMP scribbler (Exhibit R-28, p. 21) for July 17, 1993. In order to get $545.22 in a DFO slip, she would have to fish all week every day.
[1934] She was shown a DFO slip dated August 28, 1993 (Exhibit R-28-1). It was pointed out to her that in the QMP scribbler (Exhibit R-28, p. 21) she would have made three deliveries to the Payor but no delivery on Saturday, August 28, 1993. She maintained that when she received her DFO slip, she made a delivery.
[1935] It was also pointed out to her that the QMP scribbler (Exhibit R-28, p. 21) shows that she would have made a delivery of $70.68 on July 3, 1993. She had no DFO slip for that day and she added that she did not make a single delivery of that amount at the end of the week.
[1936] It was also pointed out to the Appellant that according to the QMP scribbler (Exhibit R-28, p. 21), between July 4 and July 9, 1993, she would have fished 10,438 quahaughs. The Appellant stated that she could not fish that amount in a week. In a week, she would average about 500 worth of quahaughs. Some weeks it could be higher, other weeks it could be lower. The Appellant filed a photocopy of a home-made calendar (Exhibit R-28-3). This document was made by Mrs. Craig, counsel for the Appellant to help the Court with a comparison of the deliveries made according to the QMP scribbler and the DFO slips. (Exhibit R-28, p. 21 as compared to Exhibit R-28-1).
[1937] She stated that her DFO slips are accurate. She was paid in cash by the Payor. In the case of other buyers she was sometimes paid by cheque and she was not sure as to whether she was paid in cash by other buyers. She also said every time she made a delivery the fish was in crates or five-gallon buckets. She would normally receive her DFO slip at the time of delivery which was usually at the end of the week. She kept her DFO slips in her filing cabinet and has kept them for other years as far back as 1989. She keeps these documents "because they involve doing my stamps for fishing".
[1938] Counsel for the Appellant filed a photocopy of a chart showing a comparison of quantities between QMP scribblers (Exhibit R-28, p. 21) and DFO slips (Exhibit R-28-1) (Counsel's suggestion is that the QMP scribblers for 1993 would show that the Appellant would have delivered 23,999 quahaugs but that her DFO slips reflect 35,454 quahaugs delivered. The Appellant would have DFO slips for more deliveries than the Payor's QMP scribblers reflect).
[1939] The Appellant's attention was directed to Exhibit R-28, p.37, which is a statement she gave to Joe Pierce, one of the investigators of HRDC. In this document it is stated : "In 1994, she was paid by cheque as well as in 1993, she was paid by cheque". The Appellant denied being paid by cheque. She also denied signing a piece of paper when she would have received a cheque. All she remembers of the interview she had with Joe Pierce "is being in there and then I left and I blacked out. I don't remember nothing of it".
[1940] In cross-examination, she stated that she fished every single week, from start to the time she finished, from July 10 through to September or October. She also made deliveries every week. She was not sure whether there would be a week that she would have made no delivery. She also said that there was never a week that she could recall not having fished. She added that every week she fished, she made a delivery. She admitted having signed declarations and obtaining DFO slips in 1993 that were made in December. She did not actually fish in December. She dropped fish off sometime towards the end of September or October, picked up her DFO slips in December. When she returned in December, Dale Sharbell would have told her that he had records of her deliveries marked in a book. She also said that she gets paid when she picks up her DFO slip. She also said that she did not deliver fish on December 10 or December 17, 1993, but that she received both DFO slips at the same time in December. She also stated that she "got exactly what's marked on my paper". Her unemployment insurance premiums would be taken off at the same time. She had no record of what she paid back to the Payor for the premiums.
[1941] In relation to fishermen's declarations (Exhibit R-28, p. 14), she said that she would sign such a document usually at the end of the week. It was suggested to her that the Respondent only had in its possession the two fishermen's declarations for December of 1993, but the witness said that she signed such documents for all of the other weeks in 1993.
[1942] She was asked why she would have sold during one week to Egmont Bay Seafood instead of going to the Payor. She said that it was closer to go to Egmont Bay Seafood.
[1943] The Appellant's attention was directed to the DFO slips which were given to her by Egmont Bay Seafood (Exhibit R-28-1). She delivered fish from the 20th to the 25th of September 1993 and she received a DFO slip each day she delivered her product. In the case of Dale Sharbell of the Payor, she was given some papers every time she saw him. The white papers which she did not throw away, were received once a week. In the case of Joe Caissie of Egmont Bay Seafood, she received her important papers every day, "because she delivered to him more often".
[1944] She reiterated that at the end of the day, she would count up the number of quahaugs she had fished and mark it in a book. She did not keep those books. She also stated that the December 10 and December 17 delivery dates were accepted by the employment office. She admitted that these dates were not the days she made her deliveries because she did not get paid when she made the deliveries, but was paid in December. She did not ask Dale Sharbell to put down the actual dates of delivery instead of the December dates because she was told by the employment office "to put them on the dates that I went out picked up my papers and my pay for them".
[1945] She did not exchange gas for quahaugs at the Payor's premises. She was shown page 21 of Exhibit 28 and said she had no knowledge of the document. She did not know what a notebook scribbler looked like. She also said she never had a bad week that she could not get enough fish.
[1946] The Appeals Officer, Lynn Loftus, was heard in this appeal on the 12, 13 and 15 of April, 1999. She filed her report (Exhibit R-28, p.41).
[1947] The appeal was for the 1993 year. The Appellant was interviewed at her counsel's office. The Appeals Officer found the Appellant credible, knowledgeable about fishing and was aware that she was illiterate. She allowed the Appellant 9 weeks of insurable earnings with lower dollar amounts.
[1948] In cross-examination, she admitted that the summary reports from DFO in Moncton would not assist her in knowing who fished what.
[1949] She accepted the DFO slips of the Payor for December of 1993 because they were odd amounts. She believed the Appellant was in the hospital and went to the buyer in December at the suggestion of an employee of the unemployment office, but the Appeals Officer did not accept other deliveries for the amounts recorded in the other DFO slips because of the reliability of the QMP scribblers. She said that the Appellant had no other records, journals or bookkeeping records, except her DFO slips.
[1950] She admitted that the only documents she had to question the ROE's were the QMP scribblers.
[1951] She was asked if the Appellant's DFO slips are correct, would it mean that the QMP scribblers would have to be inaccurate? Her answer was that she was not a hundred percent sure of the QMP records or the DFO records. She could not say with any certainty that either of them were accurate, that all the DFO slips were in question. Everybody that sold to Sharbell's resulted in their DFO slips being questioned. When she started her volume analysis, she was attempting to show the credibility of the DFO slips.
[1952] She did not believe that the QMP scribblers or the DFO slips were accurate. She said that during her investigation the tax returns of the Appellant for 1990 to 1992 or 1994 and 1995 were never looked at. She admitted that even if the Appellant did not receive a DFO slip for a sale of fish, she would have to report the income on her tax return. She agreed that the fishermen had no access to the QMP scribbler. She said that the places fished on the Appellant's DFO slips agreed with the places fished which were marked in the QMP scribbler. She did not doubt that the Appellant fished.
[1953] The Appeals Officer when examining the QMP scribbler saw certain writings such as "paid" and dollar amounts. Her reasoning was that such inscriptions would not have anything to do with contamination. The Appeals Officer said that she was concerned about what the fishermen sold, the dollar amount of the delivery, the date of delivery and whether the person delivered the products and was paid.
[1954] She said that she was not involved in the investigation process and did not sit in on meetings with the Appellants and the investigators.
[1955] The focus of the appeals was to determine the insurability, the earnings of the fishermen and the dates. She was concerned that the Payor was selling product for cash. If the Payor had paid by cheque the Appellant would have had a paper trail, and it would have been easier for the fishermen to prove that they had been paid.
[1956] She was asked then what difference it made if paid by cheque or cash in terms of the accuracy of what is on the DFO slips. She replied that a cheque was a very real proof of payment and that doubts had been cast on the DFO slips because: "some of them (fishermen) said that they were falsely prepared, that they had requested them and so on without ever fishing or that they had wrong amounts" (p. 69 of the transcript of April 12, 1999). She was then asked where those people were and she replied that "they were not here today".
[1957] The Appeals Officer said that there was nothing wrong with the Appellant receiving cash for her sales as long as she reported all her income but that other records should have been kept by her. It was then suggested to her that the Appellant did keep other records such as her DFO slips. The Officer replied "as has been said many times a calendar, a journal, a diary, a scribbler. The QMP's were scribblers, so there was no reason why a fisherman couldn't keep a scribbler with the dates that they fished and the amounts that they received on those dates and what their ... how far they had to travel, what their gas expenses would be" (p.71 of the transcript of April 12, 1999). It was then suggested to her that some fishermen may have done some house cleaning and thrown a lot of things away. She replied that the items she indicated would be official records and "they're supposed to be kept for at least six years for self-employed individuals". She said "DFO slips were obviously considered by fishermen to be their official records when in fact, they're really a statistical record" (p. 72 of the transcript of April 12, 1999). She indicated that for a fisherman to keep a calendar page as a diary would do and part of being a self-employed individual "was to make an entry into a book which only takes seconds".
[1958] She said that sometimes, the QMP agreed with the sales records of the Payor and sometimes the DFO slips agreed with the sales records of the Payor.
[1959] Another thing the Appeals Officer was trying to establish was the amount of local sales and if Dale Sharbell would have the cash necessary to pay out the fishermen (p. 79 of the transcript of April 12, 1999).
[1960] She relied on the QMP because they were as official as the DFO slips and according to Dale Sharbell, he was keeping those both sets of records for the Department of Fisheries and Oceans.
[1961] The Appeals Officer when she interviewed the Appellant at her lawyer's office on March 13, 1996, did not discuss the contents of the QMP scribblers because she was on a fact finding mission and had not yet had a problem with any of the Payor's records.
[1962] She said that what Dale Sharbell had said about the preparation of DFO slips was not in accordance with what many fishermen said.
[1963] In the case of this Appellant, she delivered some product in October and was paid in December when DFO slips were prepared. The Appeals Officer agreed that the Appellant delivered her product in October but that the sale did not take place until she was paid in December and that she would have no insurable earnings until she was paid by the buyer. She said that the Payor would not issue a DFO slip for something he had not paid for (pp. 104-105 of the transcript of April 12, 1999).
[1964] The Appeals Officer maintained that "there was doubt cast on the accuracy of those DFO slips. Just as there's doubt on the QMP, there's doubt on all the records. So, we had to do the very best we could with the volume analysis in order to come up with which was more accurate at each time and then base our estimates on that" (p. 105 of the transcript of April 12, 1999).
[1965] She said that she had no doubt about the fact that Claudette Gallant delivered the fish which is described on her DFO slips. She did not doubt that Claudette Gallant got paid the amount that is on her DFO slips but what she did not know was whether the amounts on the FDO slips were accurate (pp. 105, 106 of the transcript of April 12, 1999).
[1966] The Appeals Officer said that she was trying to find out which set of records were the more credible and she was generally looking at what Dale Sharbell did with the product after he received it, which included what was sold in the store, what he shipped to another buyer or shipped off the Island.
[1967] It was then suggested to her that the focus of the inquiry became Dale Sharbell, his records, his sales and record keeping as opposed to the individual fishermen. To this, the Appeals Officer did not agree and added that it formed a part of the appeal process and that each appeal was judged on its own merits and her department had to look at both, the buyer and the fishermen to get a complete picture. She did not find invoices for everything. She did not know why the QMP records included such terms as "paid", "stamp" and "dollar amounts". For the Appeals Officer the QMP looked almost like "this one set of records was being used for a dual purpose recording purchases and for the purposes of recall in case of contamination" (p. 119 of the transcript of April 12, 1999).
[1968] She said that fishermen did not agree with the accuracy of the QMP scribblers and that was the reason they were in Court.
[1969] The Appeals Officer was also cross-examined as to her examination of the income tax return of the Payor for 1992 and 1993 (Exhibit R-8, tabs. 1 and 2).
[1970] The Appeals Officer for this part of her review, relied on the master file which she received from the Rulings Officer.
[1971] The Appeals Officer agreed that the Court record contained only part of the financial documentation of the Payor and it would be necessary to see the documentation for the store also to be able to reconcile the financial statements for the business with the income tax returns.
[1972] The Appeals Officer admitted that she never compared the individual DFO slips with the summaries she received from Moncton.
[1973] She did not realize that Gary Robbins did not look at the DFO slips because he had assumed that they would have been the same as the ROE's. The DFO slips she would have looked at in the appeal process would have been contained in the ruling which would have been received from HRDC.
[1974] She repeated she believed that Claudette Gallant fished, but she could not say whether the amounts and the dates fished are accurate or inaccurate (p. 178 of the transcript of the April 12, 1999).
[1975] She admitted that she only found a certain amount of written documentation to support the sales of the Payor. The Payor's income tax return showed more sales than the sales documentation. She was then asked whether it might be the sales records that were incomplete rather than the DFO slips? She replied that it could be but that Dale Sharbell had said on three or five occasions that he had given all his records to the Respondent. She also admitted that she could not tell from the Payor's sales records what he bought (pp. 185 to 187 of the transcript of April 12, 1999).
[1976] She said that as a starting point, she was trying to reconcile the Payor's purchases on his income tax return to see if she was dealing with a few or many thousands of dollars. She had only part of his records relating to sales. There was a big gap between his purchases and his sales. She finally said that "if we knew exactly what he (Sharbell) did with his product, we'd probably have accurate records and nobody would be here (in Court)" (p. 189 of the transcript of April 12, 1999).
[1977] She said that she knew the Payor was selling to other buyers but she did not know what he was selling.
[1978] She also explained how it could benefit people to have their DFO slips inflated. "I'm not saying necessarily Claudette (Gallant) did, but I'm saying that this is what some of the people did, they had them inflated and paid the...filed on their income tax, showed the inflated income on their income tax, had the expenses to offset it and then benefitted by having higher unemployment insurance benefits paid. That's one of the things that happened that cast doubt on this in the first place" (p. 194 of the transcript of April 12, 1999).
[1979] The income tax returns of this Appellant for the years 1989 to 1993 were filed in the Court record (Exhibit R-28-8). The Appeals Officer was asked if these returns suggested inflated income when in 1993 the year under review her income was lower that other years? The Appeals Officer said that she was not suggesting that the Appellant was inflating her income but that some of the fishermen were and doubt had been cast on the records of the buyer and this resulted in doing the analysis of the records. She then said that all this enquiry started with HRDC because somebody had questions about Sharbell inflating DFO slips (p. 203 of the transcript of April 12, 1999).
[1980] She found no general or specific motive for this Appellant to under report her income. The fact that the sales were in cash was not a problem. The reason the Appellant was in Court was because she sold to the Payor who was under investigation. She also agreed that the reason for denying the amounts revealed on the Appellant's DFO slips was the QMP records. She said that she did not use the word accurate but used the terms "were more reliable", "more closely matched", "more closely reliable". The Appeals Officer also said that if the purchases, shown on the DFO slips that Dale Sharbell had sent or were picked up by the Department of Fisheries and Oceans, agreed with his sales records, less an amount for spoilage, then the DFO slips would have been proven correct. She did the volume analysis and Gary Robbins did the sales amounts. She could not account for the profit and the income that was reported by the Payor. She said that Dale Sharbell never used the QMP scribblers in calculating insurable weeks or insurable earnings. She said that the Payor had told her that she had all the records and "if the Payor is saying that, then that's it". She said that there were more sales than there were records.
[1981] The Appeals Officer was cross-examined on April 13, 1999. Her understanding was that during the HRDC interviews, the DFO slips would be copied to the statement of the person being interviewed. She was not sure whether she had a complete copy of what documentation came from HRDC. What is provided to her by HRDC is normally what is provided to the Rulings Officer. She does not go directly to HRDC unless she has a question or needs clarification. She did not have HRDC files pertaining to Claudette Gallant to physically look at them.
[1982] She said that there were many cases where people had provided additional information where the chart (Exhibit R-64, tab. 6, p. 1) was ignored. "When we had unusual circumstances or if there was somebody that had additional records that proved one way or the other that something happened, then that chart was ignored. So, no, it wasn't arbitrary. It was a guideline (the chart)".
[1983] She said that purchases from other buyers would not be included in the DFO printouts from Moncton but would be included in the QMP records if the Payor was shipping the product and was listing fish from another buyer in the QMP. She did not have the names of other buyers.
[1984] She said that the Investigation Officer had reason to question the records of earnings prepared by an employer which means all records of earnings and of all the records of any fisherperson who sold to the Payor. She did not know what the investigator's reason was and she "didn't want to know" (p. 102 of the transcript of April 13, 1999). She said that she did not fell it necessary to pressure HRDC to find out more as to why this project of 294 fisherpersons was coming on her desk.
[1985] In her memorandum she stated, Lew Stevenson had borrowed business records for 1992 and 1993 and compared purchases to fish sales. She was not aware what records Lew Stevenson obtained and no list was provided to her of what he looked at (p. 117 of the transcript of April 13, 1999). She said that she saw the same records that the Rulings Officer saw but she did not know whether these were all the records that the investigators of HRDC saw (p. 119 of the transcript of April 13, 1999). She made the assumption that Gary Robbins had the records that were sent by Lew Stevenson of HRDC. She said that Martin Smith statement was provided to her by Lew Stevenson. She also said that there could be other information in the possession of Lew Stevenson that was never provided to her. She was not sure what the investigator Lew Stevenson of HRDC was looking for, but her understanding was that somewhere along the line there was "a report of ROE's being issued falsely" (p. 126 of the transcript of April 13, 1999). The DFO slip was an entry in the payroll records for the purposes of preparing the ROE's and the T4F's and for remitting the deductions to Revenue Canada.
[1986] She stated that the issue of accuracy or reliability did not arise from the QMP scribblers but from the DFO slips because somewhere between 10 and 20 people admitted they had false DFO's; so she said if the fishermen had false DFO's that is where the doubt was cast on the reliability of the records not the QMP records. The suspicion was that the records of earnings had been prepared falsely (p. 131 of the transcript of April 13, 1999). Those who had admitted that they had false ROE would not be at the hearing (p. 141 of the transcript of April 13, 1999).
[1987] She did not know whether the assumption of Lew Stevenson to the effect that the ROE's were falsely prepared, was based on the QMP scribbler. She was then referred to R-64, tab. 13, p. 2.
[1988] The Appeals Officer agreed that when she asked her department for the 1992 and 1993 tax returns, it would have been more helpful to the Court proceedings to have had the 1993 and 1994 tax returns and the financial statements for the 1992 and 1993 business years. She did receive the financial statement for the store for the 1993 year. She did admit that it was possible that she did not see the sales and the purchases for the fishmart for the 1993 year. It did not come to her attention that she needed to look at the 1994 income tax return and the 1993 financial statements to do her work for the Payor's 1993 year of business. She said it was an oversight on her part. After lengthy cross-examination, she admitted that she did not do an analysis of the income tax of the Payor and she did not know what was in the records provided to Lew Stevenson of HRDC that might have shed more light on the Payor's reported income in his tax returns (p. 209 of the transcript of April 13, 1999).
[1989] The reliability of the QMP scribblers was what determined the insurable earnings of this Appellant except for the two weeks in December of 1993. These two weeks were allowed because Dale Sharbell had confirmed her story. The Appeals Officer wondered however how the Payor would know what to pay her two months after the delivery if they did not have some records of the delivery (Exhibit R-64, tab. 13, p. 6).
[1990] The cross-examination of Lynn Loftus, the Appeals Officer, continued on April 15, 1999.
[1991] She was referred to a passage of her memorandum to Head Office dated May 30, 1996 (Exhibit R-64, tab. 13, p. 3) where we read as follows:
"An opinion was sought from the Department of Justice in Halifax and we have enclosed a copy of their report which indicates that with proper handling of the case the QMP records could be introduced and used in court".
[1992] She replied that she had sought an opinion not just about the QMP scribblers but because there was a concern about all the records. She was asked what her concern was and why she was looking for an opinion about the QMP records? She replied that it was the reliability of the QMP and the DFO records: "I still don't have the opinion that they're totally reliable" (pp. 14 and 15 of transcript of April 15, 1999).
[1993] Then, she was asked what her concerns were that made her ask an opinion from the Justice Department? Her answer was as follows:
"Right. Well, the concerns were that where sometimes the QMP agreed with the shipping records, where sometimes the DFO agreed with the shipping records, it left us with a dilemma of which records are more reliable. And should we look at the records as being more reliable at some periods with one set of records; more reliable at another set of ...or another period of time with a different set of records? It was very very confusing. So we were trying to establish something that would tell us which set of records could be more closely relied upon."
(p. 15 of the transcript of April 15, 1999)
[1994] She said that the 1994 year of fishing of the Appellant was not looked at because it did not form part of the appeal.
[1995] She said that if she had any question on income tax, that was complicated, she would go to Walter MacDonald, her immediate superior.
[1996] She was asked if she was qualified to do a volume analysis of the Payor's business? Her reply was that it was also under the direction of Mr. MacDonald and that it was not something that she did on her own. She did the volume analysis and showed it to Mr. MacDonald but nobody else but her, actually did it. She said that she was not a forensic accountant.
[1997] In re-examination, she was asked to look at the DFO slip of the Appellant to see whether unemployment insurance premiums were being recorded? She indicated that in some instances there were indications.
[1998] She was asked if the DFO slips have sufficient information on them to find out exactly what dates the fishermen were fishing and what amounts they received? Her answer is as follows:
"Oh. No, because a lot of people claimed that they received a DFO slip at the end of the week and that they had made multiple deliveries in the week. So that would be a situation where you don't know exactly when the fish was delivered or paid for. You just know that, at the end of that week, that that was the amount that was supposed to have been paid." (p. 49 of the transcript of April 15, 1999)
[1999] She also said that local sales could include over the counter sales. In the sales that were used in the analysis, she did not know if she had all the local sales but that according to Dale Sharbell, he had provided everything. She did have invoices that showed local sales. She also said that over the counter sales would be what was sold over the counter in the grocery store or convenience store part of the Payor's establishment and not the fish mart portion.
[2000] She also said that the Appellant could have obtained her file through access to information immediately after she finished her report because informal requests are acted upon immediately.
[2001] She was also asked what weight she placed on the income tax returns of Sharbell. In response, she replied that all she was basically looking for was to see whether there were large amounts of purchases, large amounts of sales, looking for a phone number of Sharbell, if there was a partnership, etc... .
[2002] Counsel for the Respondent put to her the following question; which was answered.
"Now, We've seen that you've reviewed a lot of DFO slips in the cases of each individual. Speaking of Ms. Gallant, if you had the supporting documents for the DFO slips, that being the actual delivery slips or slips that she received showing weight, would that be more reliable for Ms. Gallant?
A. Yes."
(p. 54 of the transcript of April 15, 1999)
[2003] She was also referred to R -64, tab. 10 at the bottom of page 7, where the $93,000.00 represents sales of the Payor.
[2004] She was shown her diary for June 17, 1996 (Exhibit R-64, tab. 12, p. 11) and said that she did not think any Appeals Officers were assigned any files at that time.
[2005] She also filed a document from HRDC which was a "requirement" to the Payor to produce records (Exhibit R-69).
[2006] She also explained why no further request for records of the Payor were made by her office. She said that all the records were supposed to have been provided to HRDC and on numerous occasions Dale Sharbell and his lawyer had indicated to her that she had everything. Counsel for the Payor instructed the accountant to provide anything further that may have been required and she received no calls from the accountant.
[2007] She also explained why she did not normally go back to HRDC for information and how the request for rulings began and in what manner the information came to her.
[2008] She also said that the motives of Mr. Stevenson would have had no bearing on her decision-making process.
[2009] She was also questioned by the counsel for the Respondent as to what she understood from the directions she received from headquarters (Exhibit R68). She explained that the Head Office's opinion was in the 2nd paragraph of her CPT 100 report (Exhibit R-64, tab. 11, p. 14) which she read to the Court (pp. 67 to 70 of the transcript of April 15, 1999).
[2010] She also said that she looked at the statements of the Appellants.
[2011] She also said that she had sought an opinion from the Justice Department before May 30th, 1996 (p. 73 of the transcript of April 15, 1999).
[2012] On being questioned by the Court, she said that to her knowledge, it was the first inspection made by Revenue Canada of the books, records accounts and documents of the Payor. She did not know whether Dale Sharbell or Sharbell's Fishmart had ever been sent a request to keep adequate books from 1990 to 1995.
[2013] She was asked whether Sharbell's Fishmart owed any premiums to Revenue Canada for the years 1992 or 1993 relating to any fishermen? She said that the Payor was remitting his premiums on a monthly basis and that she did not do the calculations for premiums. She did not find out during her investigation of the Appellants whether the Payor owed any premiums to Revenue Canada for the 1992, 1993 years relating to anyone of the fishermen.
[2014] This Appellant, who in 1993 could barely read or write, was a truthful witness. She had no knowledge of the Payor's QMP scribblers. She did receive DFO slips for all the deliveries she made to the Payor. She was not paid, nor given DFO slips on each delivery. She was given a DFO slip at the end of the week. Actually the evidence established that this Appellant delivered fish in late September or early October of 1993 and was not paid or given a DFO slip or asked to sign a Fisherman's declaration till sometime in December. The reason for this was that the Appellant was hospitalized on October 8, 1993. It was only after her stay in hospital that she obtained her DFO slips and her pay from the Payor. She went to the Payor at the suggestion of the employment office.
[2015] No evidence established that this Appellant would have obtained DFO slips for deliveries that she did not make or that she did not fish for what is represented in her DFO slips. No evidence showed that she would have participated in falsifying her ROE or making other false statements in relation to any claim for unemployment insurance benefits.
[2016] The Appellant has established by a preponderance of evidence that her insurable earnings are those described in her record of employment issued for 1993 by the accountant according to the records kept under section 77 of the Regulations.
[2017] This appeal must be allowed.
21. Darren Gamble
[2018] The Appellant, through his representative, in appeal No. 96-2167(UI), as to paragraph 7 of the Reply, admitted the allegations in subparagraphs a) to c), e) and h) to k). The allegations in subparagraphs d), f), g), l) and m) were denied and disproven by the evidence.
[2019] The Appellant was represented by his father, Leroy W. Gamble, who testified at the hearing on behalf of his son. This Appellant was not heard.
[2020] For the comprehension of this appeal one must refer to Exhibits R-29 to R-29-4.
[2021] Leroy W. Gamble said that he helped his son deliver eels on two occasions to the Payor. The Appellant would have signed declarations and received DFO slips.
[2022] During the course of the investigation, Leroy W. Gamble would have met Patricia Griffin of the Respondent. He gave to the Respondent, at his request, a series of receipts and as a result the Respondent would have reinstated the Appellant's ten weeks of benefits but at a reduced rate. He had in fact provided receipts for his son's expenses. What he was contesting was the decision concerning the first three weeks of the Appellant's deliveries. His son had DFO slips from the Payor which should allow the Appellant to be allocated the maximum of insurable earnings of $745.00 for those weeks of August 27, September 3 and 11 of 1993.
[2023] In cross-examination, it was indicated to him that the Respondent was looking for records that indicated the amount of fish that his son fished and delivered to the Payor during the three weeks of August 27 and September 3 and 11 of 1993. Leroy W. Gamble stated, that the only evidence were the DFO records, the record of employment and the declarations (Exhibit R-29, pp. 12 to 31).
[2024] The Appeals Officer, Patricia Griffin, was heard on November 30, 1999. She was cross-examined by Leroy W. Gamble, the father of the Appellant, who dealt with the Appeals Officer during the appeal process. She stated that what she was looking for was a paper trail from the Appellant so that he could prove to her that he had fished the quantity of fish he claimed to have delivered.
[2025] The Appeals Officer admitted that she determined that the Appellant fished but she questioned his earnings for eels he had sold to the Payor. The ultimate decision was that since the name of the Appellant did not appear in the QMP scribblers and she deemed the QMP scribbler to be accurate, she allocated to the Appellant three weeks of insurable earnings at the minimum of $149.00. In fact, she admitted that the receipts that were provided to her convinced her that the Appellant had fished but did not convince her that he had fished the amount of fish recorded on his DFO slips for the weeks of August 28, September 3 and 11, 1993.
[2026] She admitted that she adopted the analysis that was made up by Lynn Loftus. She began working on these appeals in June of 1996. She answered to Walter MacDonald, the Chief of Appeals.
[2027] She was asked if the Appeals Officer met to discuss what was going on in these appeals. She replied that they must have met but not on a rotation basis. She stated that Lynn Loftus had said that the QMP scribblers were accurate. She also admitted that the QMP scribblers were not accurate to 100%; she did not know how accurate they would be.
[2028] She was shown Exhibit R-64, tab. 7, p. 4. She admitted that she never compared the figures outlined in the exhibit and was not familiar with them. In fact, she admitted that the directions given to her were that if the QMP scribbler was deemed reliable she allocated earnings according to the QMP scribbler and if the QMP scribbler was not reliable she allocated earnings according to the DFO slips.
[2029] The evidence put forward in this appeal showed that the Appeals Officer did not know the accuracy of the QMP records. She was not in a position to determine the insurable earnings of this Appellant. In fact, she admitted that she was convinced that he fished and delivered to the Payor. She gave this Appellant the benefit of the doubt and allocated minimum earnings to him because his name was not in the QMP scribbler. The Appellant or his representative could wonder, why? If she believed he fished and sold to the Payor according to what she was told and if his name was not in the QMP scribbler, would that not be an indication that the QMP scribbler was not accurate?
[2030] The direction given by the Appeals Division to the Appeals Officers did not leave much discretion to the officer faced with a situation such as described here.
[2031] The evidence of the Appeals Officer in this case contradicted the position of the Minister in his submissions where he maintained that estimates were carried out under section 80 of the Regulations.
[2032] The evidence of Leroy W. Gamble and his documentation must be accepted as the only valuable evidence in this appeal. No evidence was shown to demonstrate that this Appellant would have participated in falsifying records of employment or any other documents or giving false statements in relation to any claim for unemployment insurance benefits.
[2033] The Appellant has established by a preponderance of evidence that his insurable earnings are those described in his record of employment issued for 1993 by the accountant according to the records kept under section 77 of the Regulations.
[2034] This appeal must be allowed.
22. Rodney C. Milligan
[2035] The Appellant, Rodney C. Milligan, in appeal No. 96-1718(UI), as to paragraph 5 of the Reply, admitted the allegations in subparagraphs a), b), h), i) and k). The allegations in subparagraphs d), e) and f) were ignored. The allegations in subparagraphs c), g), j) and l) were denied and disproven by the evidence.
[2036] For the comprehension of this appeal, Exhibit R-30 and R-30-1 were filed in the Court record.
[2037] This Appellant heard on March 11, 1999, stated that he did not sell any fish to the Payor and did not receive a record of employment from the Payor in 1992. He maintained that the Payor did not record purchases of his in QMP records. The Appellant denied having two insurable weeks with the Payor between September 19 to October 16, 1992 because he did not deliver any fish to the Payor in 1992 and therefore had no earnings.
[2038] The Appellant was cross-examined with his record of employment for 1992, with a payor called Garry William. He was questioned as to his oyster fishing. He stated that in 1992, it was the first year that he sold oysters.
[2039] He said that the only records he kept for his deliveries were his DFO slips. He was asked whether he kept any records at home other than the DFO slips. He replied that the only document he received was a DFO slip.
[2040] He was shown Exhibit R-30 at pages 13 to 16. He was told that these pages were the Payor's QMP records. He saw these pages approximately a week before his appearance at the hearing.
[2041] He was also cross-examined with a questionnaire filled out by him and sent to the Rulings Officer, Gary Robbins (Exhibit R-30, p. 17). He stated that he fished on the public ground. He repeated that in 1992, he made no deliveries to the Payor for himself or for anyone else.
[2042] The Appeals Officer, Don MacLean, was not available at the hearing but Rosemarie Ford was called as a witness on November 30, 1999. The Appellant had no questions to put to Rosemarie Ford.
[2043] This Appellant was truthful, was not contradicted and his evidence must be accepted. No evidence was shown to demonstrate that this Appellant would have participated in falsifying records of employment or other documents or made false statements in relation to a claim for unemployment insurance benefits.
[2044] The Appeals Officer Don MacLean was not heard to explain his decision. However, the evidence showed that he was in the same position as the other Appeals Officers, Rosemarie Ford, Elizabeth Whyte and Patricia Griffin. He took no part in the decision to determine the reliability of the QMP records. He would have followed the reliability chart referred to earlier.
[2045] This Appellant was determined to be an insured person although his name did not appear in the records to be kept by the employer under section 77 of the Regulations for 1993.
[2046] As the Court stated earlier, even if he had made a sale to the buyer, since there was no declaration he was not to be considered as an insured person.
[2047] The Appellant has established by a preponderance of evidence that he had no insurable earnings with the Payor for the 1992 taxation year.
[2048] This appeal must be allowed.
23. Allan Coughlin
[2049] This Appellant was heard on March 1, 1999. The Appellant, Allan Coughlin, in appeal No. 96-2097(UI), as to paragraph 6 of the Reply, admitted the allegations in subparagraphs a), b), i) and j). The allegation in subparagraph f) was admitted with further explanations to be given at the hearing. The allegation in subparagraph d) was ignored. The allegations in subparagraphs c), e), g), h) and k) were denied and disproven by the evidence.
[2050] Exhibits R-31, R-31-1 to R-31-4 were filed in the Court record.
[2051] The Appellant stated that in 1993, he did not fish eels but fished quahaugs. He did not deliver any catches to the Payor in 1993 and received no DFO slips from the Payor. Consequently the Payor did not issue a record of employment to the Appellant.
[2052] This Appellant filed Exhibits R-31-1 to R-31-4. This documentation was received by the Appellant the day before he was heard in these procedures. The Appellant fished 36 days (Exhibit R-31-2). He participated in what is called "The Contaminated Quahaug Relay Program for 1993" (Exhibit R-31-4). A report for every week of fishing was prepared by the coordinator of the Quahaug Relay Project (Exhibit R-31-1). The Appellant delivered the catches he made to one buyer, Hardy's, (Exhibit R-31-2).
[2053] The Appellant explained that he had to deliver every day because the quahaugs were contaminated. He could not find all the copies of the deliveries he made but filed in the record those he could (Exhibit R-31-3). He could not obtain the DFO slips for the 36 days he fished at the "Contaminated Quahaug Relay Program for 1993".
[2054] In cross-examination, the Appellant first stated that he is not too good at papers because he cannot read or write.
[2055] He was shown Exhibit 31-3. He said that he received these receipts from Leslie Hardy for the delivery of quahaugs. He explained that he fished and also hauled the quahaugs for the buyer Leslie Hardy. He received a fax from Transport Canada (Exhibit R-31-2), indicating that he worked for 36 days and delivered 119 bags of quahaugs to Leslie Hardy. The Contaminated Relay Program was over on September 11, 1993.
[2056] He also said that prior to July 26, 1993, he would fish oysters from mid-May but would not have a record for them because "I just bedded them", (p. 264 of the transcript of March 1, 1999). He sold oysters to Leslie Hardy in 1993. He said that he did not sell any fish at all to Sharbell in 1993, (p. 264 of the transcript of March 1, 1999) and he did not deliver any fish to the Payor for someone else in 1993.
[2057] He was cross-examined as to his records of employment received from Milligan's Fisheries Ltd. (Exhibit R-31, p.11) and Leslie Hardy (Exhibit R-31, p. 12).
[2058] He was asked whether he kept any records of when he made deliveries or what type of fish he was fishing in 1993. He said "I usually kept records but not ... like after so long, I wasn't keeping them". He did not keep records when he fished oysters, he did not keep a diary and he did not keep the DFO slips since he was working on a government program: "I thought for sure they'd have them. They didn't have them either".
[2059] He was shown a page of the Payor's QMP scribbler (Exhibit R-31, pp. 13 and 14). He said that he first saw this document at an interview he had with Lew Stevenson. It was the first time he was made aware of such documents.
[2060] He was also questioned about a statement he gave to the investigators Lew Stevenson and Joe Pierce. He did not sign his statement because the investigators did not write what he said and he could not read the statement.
[2061] In 1993, the Appellant did not fish any eels and he did not deliver eels for anyone. He did sell eels in 1992 to the Payor.
[2062] The Appeals Officer, Betty Ford, was heard on November 29, 1999. She allocated six weeks of insurable earnings to the Appellant based on the reliability of the QMP scribblers of the Payor (Exhibit R-31, p. 34). The Appellant asked her how did she know by looking at the name in the QMP scribbler (Exhibit R-31, p. 13) that it was he who had delivered the fish. The QMP scribbler indicates no social insurance number and no address. Her reply was that he had fished. She also admitted that she did not know what the Appellant could have provided to her to prove that he had not made any deliveries to the Payor in 1993. She was shown Exhibits R-31-1 to R-31-4. She said that she did not have these documents when she made her decision.
[2063] This Appellant was not contradicted and was truthful. No evidence showed that this Appellant would have participated in any way in the falsification of records of employment or any other documents. His evidence demonstrated that the Appeals Officer was mistaken, in not giving weight to his version of the situation, which was what he had said to the investigators of the HRDC in his statement of December 15, 1995, when he reported.
[2064] The Appellant has established by a preponderance of evidence that he had no insurable earnings with the Payor for the 1993 year.
[2065] This appeal must be allowed.
24. Paula Rayner
[2066] This Appellant was heard on March 2, 1999. The Appellant, Paula Rayner, in appeal No. 96-2101(UI), as to paragraph 5 of the Reply, admitted the allegations in subparagraphs a) to c), e), h) and k). The allegations contained in subparagraph i) were admitted as amended (in that she did not use a boat in catching "quahaugs", but used a boat for catching oysters). The allegations in subparagraphs d), f), g), j) and l) were denied and disproven by the evidence.
[2067] Exhibit R-32 to R-32-4 were filed in the Court record.
[2068] The work period of this Appellant under appeal is from July 28 to September 9, 1993. The Appellant used a boat to fish oysters but not for fishing quahaugs. The Appellant said that she delivered quahaugs to the Payor in 1993 and she filed photocopies of her three original DFO slips (Exhibit R-32-1) which she had in her possession.
[2069] In cross-examination she said that in 1993, she only sold quahaugs to the Payor. She never sold clams to the Payor in 1993. She never used a boat to fish quahaugs but she may have used a boat to travel from one area to another. She also sold fish to Kennie MacWilliams and Leslie Hardy & Sons Ltd.. She explained how she fished, how her husband would help her with her deliveries and how she kept her fish separate from her husband's fish since they at times fished together.
[2070] She explained that she was paid in cash after the Payor deducted the premiums for unemployment insurance. She also said that she delivered once or twice a week but was not sure. She may not have fished every day and could have taken a week off. She could not recall why she did not continue to fish throughout the season. She was paid by Dale Sharbell. Her deliveries would have been accepted by Martin Smith. The DFO slips that she received from the several buyers she dealt with are the only receipts she had to prove her claim. She fished oysters with her husband Darryl MacIntyre.
[2071] The Appeals Officer, Patricia Griffin, was cross-examined by the Appellant on November 11, 1999.
[2072] The Appellant pointed out to the Appeals Officer that a fisherperson does not sign a DFO slip and does not receive a copy of the declaration that is signed at the Payor's premises.
[2073] The Appeals Officer stated that she obtained from the Appellant's interview with HRDC that she had fished oysters in Enmore.
[2074] The Appellant said to the Appeals Officer that she had made a mistake at the interview. The Appeals Officer stated that she only made a note of the HRDC interview and that the Appellant answered all the questions.
[2075] The Appellant put several other questions to the Appeals Officer in relation to whether she had fished alone or not. The answers given would show that the Appellant fished alone.
[2076] Since the Appellant had no other records besides her DFO slips and her name was not in the QMP scribbler which, for the period, was considered reliable, she was given no earnings.
[2077] The DFO slips from other buyers were accepted but not those of the Payor.
[2078] This Appellant was not contradicted and gave a truthful account of what she did. No evidence showed that this Appellant participated in falsifying ROE or DFO slips or participated in making false statements in any application for unemployment insurance benefits.
[2079] The Appellant has established by a preponderance of evidence that her insurable earnings are those described in her record of employment issued for 1993 by the accountant according to the records kept under section 77 of the Regulations.
[2080] This appeal must be allowed.
25. Shawn Perry
[2081] This Appellant was heard on March 2, 1999. The Appellant, Shawn Perry, through counsel, in appeal No. 97-551(UI), as to paragraph 5 of the Reply, admitted the allegations in subparagraphs a) to c), e) and k). The allegations in subparagraphs d), f) to j) and l) were denied and disproven by the evidence.
[2082] Exhibits R-33 and R-33-1 were filed in the Court record.
[2083] The Appellant worked as a fisherman's helper, fishing lobsters in 1993. He did not sell any fish product to any purchasers in 1993. He sold no fish to the Payor. He received no DFO slips or record of employment from the Payor in 1993. He was shown Exhibit R-33 at page 12, which is a photocopy of the QMP scribbler of the Payor. He stated that he had no knowledge of the contents of that document. He said that there are other Shawn Perry's in his area of the province, who are in the fishing industry.
[2084] He received his record of employment from Tignish Fisheries CO-OP Assn. Ltd. (Exhibit R-33, p. 11). He said that this document reflects what he earned in 1993 from his employer. He sold no eels in 1993.
[2085] The Appeals Officer, Don MacLean, was not available for the hearing of this Appellant and another Appeals Officer, Rosemarie Ford, was called upon by the Respondent to represent him.
[2086] She was cross-examined by Mr. Rhynes, counsel for two Appellants, Shawn Perry and Linus Bulger on April 15, 1999 (p. 207 of the transcript of April 15, 1999).
[2087] She stated that in deciding appeals certain guidelines are set out in the Regulations and the Act that she had to follow.
[2088] She said that the fishermen, in order to oppose the QMP scribblers, would have to show the Appeals Officer some other record or receipts or something along those lines.
[2089] Then, she was asked that if a person did not fish such as in the case of Shawn Perry what would she have done?
[2090] Certain questions were put to Lynn Loftus in this file which was done by Don MacLean, another Appeals Officer, and she stated that she could only speak to what she did on files that she had worked on (p. 176 of the transcript of April 15, 1999).
[2091] The following questions and answers of the witness, indicated what the Appellants were required to show to this Appeals Officer, in order to oppose the findings of the QMP scribbler:
"Q. Okay. I'd ask you just to concentrate on Shawn Perry for a moment. You heard Mr. Robbins and Ms. Loftus point out that they used the QMP scribblers for the months or weeks that they were more accurate, and the way to oppose that would be to come in with your own records.
A. Yes.
Q. And it seems that those records would have to be some type of independent materials that you had compiled. They could be identical to your DFO slips in many cases, but you had to have something physical to show the officer, or it seemed that you were going to be found in accordance with the scribblers. Is that -- you agree with that?
A. I believe that's the way I completed them, yes. If they could show me, you know, something - receipts or something along that line, then ---
Q. Now, what happens to an individual in the case of Shawn Perry who didn't fish, didn't have anything physical to show the Appeals Officer? What could that person have done to prove his - the accuracy of his - what he's telling you? In other words, to refute the finding of the Rulings Officer.
(pp. 217 and 218 of the transcript of April 15, 1999)
...
A. It would be hard for him to show that he didn't fish, but you know, sometimes it's possible to show something. Maybe he was off island or ---
Q. Yes.
A. You know, you say he was drawing Unemployment Insurance, so I guess he wasn't working for anyone else. If he had had, you know, something like that or someone that knew that he was doing something else at the time or - I know it would be hard --- "
(pp. 219 and 220 of the transcript of April 15, 1999)
[2092] Don MacLean, the Appeals Officer, in his report of December 9, 1996 (Exhibit R-33, pp. 21 and 22) concluded his summary as follows:
"(VI) SUMMARY
The worker is adamant that he did not sell to Sharbells in 1993. He stated that he last sold to them in 1988/89. The worker had fishing income in 1990 from the sale of moss and for the past ten years has been fishing lobster as a crew member.
The worker's name appears in the QMP and he has no explanation as to why. The amounts are of small dollar value and the rulings officer allocated 2 minimum weeks based on the needs for a boat for eels spearing. The worker was drawing UI benefits during the period in question.
Since the QMP have been determined to be accurate for the period in question, our position is that the worker was fishing during the period under review. There is no reason to give benefit of doubt in this case.
..."
[2093] The Appeals Officer concluded that the Appellant was fishing as he had no explanation as to why his name was in the QMP scribbler. The QMP scribbler was an accurate record, and the Appellant was receiving unemployment insurance benefits.
[2094] No thought appears to have been given to the fact that the Appellant had no participation in the making of the QMP scribblers. No weight was given to the position of Dale Sharbell as to the making of the records as corroborated by Martin Smith. No weight was given to the initial explanation of the Appellant when he was first questioned about the matter on June 6, 1996, when interviewed by Joe Pierce of HRDC (Exhibit R-33, p.18).
[2095] How could the Appellant explain the appearance of his name in the QMP scribbler unless he had some type of knowledgeable participation in the making of the record?
[2096] Why would the allegation that he was drawing unemployment insurance benefits, be one of the factors that led the Appeals Officer to determine that he was fishing and sold to the Payor?
[2097] The evidence of this Appellant was truthful and was not contradicted. No evidence showed that he would have delivered any product to the Payor in 1993. The fact that his name was in the Payor's QMP scribbler as was described by the Payor cannot be accepted as evidence that this Appellant would have made a delivery to the Payor in 1993.
[2098] No evidence showed that he would have participated in falsifying any documents or records kept by the Payor, or made false statements in relation to his fishing activities in 1993 or any other years for that matter.
[2099] The arguments of counsel John R. Rhynes must be accepted as if recited at length in this appeal in particular and the appeals in general.
[2100] This appeal must be allowed.
26. Robert M. Arsenault
[2101] This Appellant was heard on March 2, 1999. The Appellant, Robert M. Arsenault, through counsel, in appeal No. 97-670(UI), as to paragraph 7 of the Reply, admitted the allegations in subparagraphs a) to c), e), h) to k) and m). The allegations in subparagraphs d), f), g), l) and n) were denied and disproven by the evidence.
[2102] Exhibits R-34 and R-34-1 were filed in the Court record.
[2103] In 1992 and 1993, this Appellant fished lobsters, mackerel, irish moss, eels and oysters. He sold eels, oysters and mackerel to the Payor. When he had enough eels fished to allow a good size insurable week, he would deliver. When he delivered his fish he received a small piece of paper at the fishmart. He then proceeded to the store where Dale Sharbell would prepare a DFO slip, deduct unemployment insurance premiums from the gross amount and he was given the balance in cash. When he delivered his eels, he would know what the weight and price of his catch would be. He was satisfied that the DFO slips were accurate. He identified his records of employment and said he received DFO slips for each sale (Exhibits R-34, pp. 14 to 28 and pp. 36 to 39). These documents also concern other buyers besides the Payor.
[2104] He was shown a page from the Payor's QMP scribbler (Exhibit R-36, p. 24). He could not identify this document. He said that he was not at the Payor's premises on the dates indicated on the document. He first saw this document in 1995 or 1996 during an interview with Lew Stevenson of HRDC. He maintained that the DFO slips were the more accurate documents. The Appellant said that in 1992 and 1993, he had no personal system at home for recording his sales.
[2105] The Appellant was cross-examined as to his fishing of eels and his deliveries to the Payor in 1992. The Appellant made few deliveries of eels in 1992. He stated that he did not make deliveries on a weekly basis if he did not have a sufficient number to deliver. He delivered fish and moss to five different buyers in 1992 which gave him 10 weeks of fishing which was sufficient for him to qualify for benefits. He admitted that he would arrange to obtain his 10 weeks. He admitted always using a boat to make his catches of eels which he sold to the Payor in 1992 and 1993. He also admitted that when comparing the record of employment for 1992 (Exhibit R-34, p. 14) with two DFO slips for the delivery dates of August 14 and July 10, 1992 (Exhibits R-34, p.20 and 21), the Payor did not deduct the 25% for the use of a boat.
[2106] The Appellant also admitted that he made one delivery of mackerel to the Payor in 1993 but did not have with him the original DFO slips He said that he would keep his DFO slips for about a year. He kept no personal record or other records other than the DFO slips. He also said he trusted Dale Sharbell for the accuracy of the DFO slips. He knew how many eels he had and the price he was being paid. He maintained that it was not his business to make out the DFO slip. He trusted the buyer. His main concern was the quantity delivered and the price to ensure that he received the money that was owed to him. He denied making purchases at the Payor's premises and paying with eel deliveries. He was questioned as to why he would incur a loss in 1992 and 1993 from fishing He replied "that's the way it goes ... fishing is good today, gone tomorrow ...". He incurred a loss in 1993 because he had purchased lobster gear and expended a lot of money to start this operation.
[2107] In re-examination, he said that the deductions for using a boat while fishing was usually done by the Payor and he did not know why such a deduction was not made.
[2108] He also stated that he had an interview with Lew Stevenson and Gary Robbins in 1995 or 1996. He explained he gave them full disclosure. He mentioned that Lew Stevenson would have called him a liar. He mentioned to counsel for the Respondent that Gary Robbins of the Respondent left the room to photocopy some papers he had brought with him. When asked for how long Gary Robbins had been absent he replied: "I'm not sure, ma'am. He was ... this is the first time I ever had something like this done to me and I was plenty nervous".
[2109] Lynn Loftus, the Appeals Officer, testified in this case on April 15, 1999. She stated that she was the Appeals Officer in the case of Robert M. Arsenault (p. 132 of the transcript of April 15, 1999).
[2110] She stated at the outset that she had made an error in her determination for the week of June 12th 1993, because the Appellant had mackerel sales that she did not consider when issuing her recommendation, so the deliveries of the Appellant should have totalled $365.06 rather than $149.00 which was a minimum week. She said that the mackerel sales should have been included in the Payor's fishing deliveries and that she had addressed that in her report. She pointed out that the DFO slip was in Exhibit R-34, p. 43.
[2111] This page is not very legible and would appear to have two entries on it. It looks as if the delivery of mackerel would have been made with a delivery of eels as the document show only two declarations for delivery of eels (See Exhibit R-34, pp. 40 and 41).
[2112] The ruling decisions (Exhibit R-34, pp. 9 and 31) dated February 21, 1996, indicated to the Appellant that the Respondent had received from HRDC a request regarding the insurability of his earnings from June 6 to October 17, 1992 and from May 22 to June 19, 1993. The records of employment concerning the years 1992 and 1993 are found in the record (Exhibit R-34, pp. 14 and 36).
[2113] The Rulings Officer in the 1992 ruling decision (Exhibit R-34, p. 9) allowed four weeks of earnings, in June and August but makes no specific mention of what happened to the week of October 17, 1992.
[2114] The Appeals Officer, in her report, took the position that the week in October for 1992 was not covered in the Appellant's request for determination (see Exhibit R-34, p. 63). The Court was not shown the Appellant's request for determination, however, it would appear that when the Appellant appealed these two decisions of February 21, 1996, he was appealing what had been decided as to what was contained in his ROE's and the October week in 1992. If it was ignored by the Rulings Officer, it would then form part of the appeal of the Appellant. This same problem arose in the case of Kevin Robinson, to which I will refer later.
[2115] I took the position in the case of Kevin Robinson, that what was appealed was the ruling decision which in essence did not uphold the Appellant's record of employment for the earnings and weeks therein described. Therefore, the Appeals Officer's duty is to determine whether the Rulings Officer's decision to modify the earnings as described in the record of employment was correct. That would require the Appeals Officer to review all the weeks in the records of employment and not only rely on dates marked on a form for appeal purposes.
[2116] It is the ruling decision as a whole that is appealed and that must be addressed.
[2117] In this case, the Appeals Officer did not address the October 1992 earnings and should have done so especially in this case, where so many people were involved and many of them unrepresented.
[2118] The Appellant in this case was truthful in his evidence and was not contradicted. No evidence was shown that he would have participated in the falsifying of records of employment or any other documents, or making false statements in relation to any claim for unemployment insurance purposes.
[2119] The arguments and submissions of counsel J. Allan Shaw must be accepted as if recited at length in this appeal in particular and the appeals in general.
[2120] The Appellant has established by a preponderance of evidence that his insurable earnings are those described in his records of employment issued for 1992 and 1993 by the bookkeeper or accountant according to the records kept under section 77 of the Regulations.
[2121] This appeal must be allowed.
27. Sally Doucette
[2122] This Appellant was heard on March 2, 1999. The Appellant, Sally Doucette, through counsel, in appeal No. 96-2216(UI), as to paragraph 7 of the Reply, admitted the allegations in subparagraphs a) to c), e), h), i) and k). The allegations in subparagraphs d), f), g), j) and l) were denied and disproven by the evidence.
[2123] Exhibits R-35 and R-35-1 to R-35-3 were filed in the Court record.
[2124] The work period under review in this case is for the 1993 year.
[2125] This Appellant worked at a fish plant called Polar Fisheries. She also fished clams for one week and irish moss for five weeks.
[2126] She took her clams to the Payor and met with Martin Smith. She fished clams that year because she was off work and needed the money. She explained how she fished her clams. She received her DFO slip from the Payor (Exhibit R-35, p. 18) and compared it to her record of employment she received from the Payor (Exhibit R-35, p. 13). She said that she could have made three or four deliveries. She sold her clams every day she fished. She was shown the Payor's QMP scribbler (Exhibit R-35, p. 19). The only inscription on that page was alledgedly to be part of her deliveries to the Payor in that year. She saw this document for the first time at the interview she had with Joe Pierce of HRDC. She said that the DFO slip was the most accurate document to determine her fishing.
[2127] She was cross-examined. She maintained that she sold soft shell clams during one week and went back to working on irish moss. She had no other record of her deliveries but the DFO slip and her record of employment whit this Payor.
[2128] She also delivered her mother's product as well. Her mother is Eliza Clements, one other of the Appellants in these cases. She was asked to explain how she fished with her mother and how she delivered with her mother to the Payor. She also explained how she kept both quantities separate. She explained how she had not much experience in fishing clams. She could not be sure how many pounds she delivered on each delivery date.
[2129] She was paid every day she delivered. She had no records of what she received except her DFO slips.
[2130] She was shown her unemployment application form (Exhibit R-35, p. 10) which she identified.
[2131] She was not aware that declarations were required at the time of delivery of fish to a buyer. She also admitted that she now knew that DFO slips were required at the time of delivery of fish. She said that another buyer, Acadia Seaplants provided a DFO slip at delivery but that she did not sign a declaration with that buyer in 1993.
[2132] She also said that she would ensure the accuracy of her DFO slip. She would add up the small pieces of paper she was given at each delivery and made sure that the number of pounds was correct. She did admit that she was checking the quantity of fish delivered and the price paid.
[2133] She filed her "Statement of Fishing Income" from the Payor for 1993 (Exhibit R-35-1).
[2134] Lynn Loftus, an Appeals Officer who did not make the determination in this case was cross-examined by Mr. Rhynes on April 15, 1993 (pp. 135 to 198 of the transcript) as to the formula that was used by the Appeals Officer and what was required of fishermen. She said that she did not know what the percentage of accuracy was for the QMP scribblers. She said that the formula was used for estimates of the fishermen's earnings but that other factors were considered and speaking of the formula she said the following:
"But it was the last thing that was looked at. When all the facts had been gathered and all the information had been looked at, that was the last thing that was looked at to determine where those earnings fit in. If there were circumstances that said this doesn't apply, this is a different situation, this is something -- somebody has produced records here that show that they fished this amount on this day or that they were out of town or out of province or in hospital or whatever, the formula was set aside in those cases. If there was nothing produced, then the formula was used." (pp. 188 and 189 of the transcript of April 15, 1999)
[2135] The Appeals Officer in the case of this Appellant was Patricia Griffin, who was heard on November 29, 1999. She did not meet with this Appellant in person. She admitted that she did not locate the ruling file in this case but that she obtained the information she needed from HRDC.
[2136] She decided that the Appellant had no insurable earnings with the Payor. She accepted however the Appellant's records with other buyers at face value. She disregarded the ROE from the Payor and the Appellant's DFO slip because of the reliability of the QMP scribblers. She was asked what else could the Appellant have done to prove her earnings besides her ROE and DFO slip. She replied that the Appellant would have needed "some kind of record calendar or diary of the small pieces of paper which were given to her at the fish plant". She admitted that the QMP scribblers were not 100% accurate "but it was the best evidence available". She did not know how accurate the QMP scribblers were because she did not participate in the decision-making process when the Respondent decided to rely on the Payor's QMP scribblers. She also admitted that she did not check with Dale Sharbell or the Payor's accountant and that it would have been better to do so.
[2137] In re-examination, she stated that if the Appellant had kept the original slips or pieces of paper, she would probably have changed her mind. The individual had to show evidence that contradicted the QMP scribblers. She admitted that there were problems with the QMP scribblers. She dealt with each case individually and if there was no other evidence besides the DFO slip and the ROE's the Appellant's she dealt with would be "not insurable"
[2138] The arguments and submissions of counsel John R. Rhynes must be accepted and adopted by this Court as if recited at length in this appeal in particular and in the appeals in general.
[2139] The evidence of this Appellant was not contradicted. This Appellant was a truthful witness. No evidence showed that this person would have participated in falsifying her record of employment of for that matter any other document in relation to her unemployment insurance claim.
[2140] The Appellant has established by a preponderance of evidence that her insurable earnings are those described in her record of employment issued for 1993 by the accountant according to the records kept under section 77 of the Regulations.
[2141] This appeal must be allowed.
28. Linus Bulger
[2142] This Appellant was heard on March 2, 1999. The Appellant, Linus Bulger, through counsel, in appeal No: 97-703(UI), as to paragraph 5 of the Reply, admitted the allegations in subparagraphs a) to c), e), h) to k) and m). The allegations in subparagraphs d), f), g), l) and n) were denied and disproven by the evidence.
[2143] Exhibits R-36 and R-36-1 to 36-3 were filed in the Court record.
[2144] The Appellant had been fishing for close to 40 years. His main activity is fishing clams and oysters.
[2145] He delivered his fish every day he fished and was paid at the end of the week. When he delivered his fish he would receive a small yellow slip of paper indicating the weight of the fish and maybe the price. He saved the small pieces of paper until such time as he received his DFO slip from the buyer. The DFO's would balance with the papers he had in his possession. These were the only documents the Appellant would receive from the Payor.
[2146] In 1992, he also sold oysters mostly to Leslie Hardy, another buyer. He was shown his record of employment for 1992 (Exhibit R-36, p. 12). He believed that it was accurate and that he must have examined it when he received it. He also identified his DFO slips.
[2147] He said that he never saw the QMP scribbler of the Payor. He was asked to look at pages 14 to 20, which represent the Appellant's DFO slips received from the Payor in 1992 and page 21, which represents the Payor's QMP record. He stated that upon examination of the QMP scribbler, it would not be accurate.
[2148] He also said that he fished clams with his wife. He used a mechanical harvester. His wife sometimes used the harvester but most of the time it was he, who operated it. He would divide the catch between him and his wife. He would instruct the buyer to give him 60% and 40% for the wife.
[2149] The cross-examination of this witness revealed that the Appellant would fish with his wife maybe three hours a day. He explained the use of the mechanical harvester which he alone had permission to operate. When he delivered his clams he would receive a piece of paper on which was indicated how the delivery was split to show 60% of the catch for him and 40% of the catch for his wife. He delivered every day. At the end of the week he or his wife would go to the Payor to obtain the necessary DFO slips and get paid.
[2150] The Appellant said that he always received his DFO slips from Dale Sharbell. He said that Dale Sharbell made them up. He also said that some of the handwriting could be that of Marilyn Enman, the sister of Dale Sharbell, whom was not at the fish mart when he delivered his fish in 1992 or 1993.
[2151] The Appellant was questioned as to the number of pounds showing on the DFO slips which appear to be similar for several weeks when compared. The Appellant said that it would not be unusual to get roughly the same or similar amounts every day.
[2152] He was shown fisherman's declarations which indicated that he was a lone-fisherman. He said he fished with his wife and as a rule they did not take turns at operating the mechanical harvester.
[2153] The Appellant was shown his record of employment for 1992 and 1993 (Exhibit R-36, pp. 12 and 32) and admitted that when compared to his DFO slips from the Payor, the 25% for the use of a harvester did not appear to be properly deducted. He admitted to several mistakes as to dates of delivery indicated on his records of employment as compared to dates on his DFO slips which he received from the Payor.
[2154] The Appeals Officer, Elizabeth Whyte was heard on December 2, 1999. She said that in her decisions accuracy was more important than consistency. She was not an accountant. She explained her qualifications.
[2155] She said she had made a decision in this appeal which differed from the Appellant's ROE's. She visited with the Appellant who provided her with a lot of information which she found was very credible and helpful. The Appellant told her that his fishing was his sole source of income.
[2156] She admitted under cross-examination that she believed the Appellant was telling the truth. She was then asked if she believed the Appellant why did she not suspect the QMP scribblers. Her answer was no. Even if she believed the Appellant, she had no way of determining the amount of fish delivered, although she had all the Appellant's DFO slips. Then she said that if he had the slips that were given at the weighing of the fish to show the poundage, it could apparently have been accepted.
[2157] She admitted that the Appellant had his ROE, his DFO slips, but that her hands were tied because the Appellant could not provide anything else.
[2158] The Appeals Officer did not know what degree of accuracy was in the QMP scribblers. Then she said: "the QMP was the most reliable source; we had to go with that; there may have been some discrepancies; obviously there was a discrepancy; they fished; they operated the machine; they had sales with Burleigh Brothers in early years; I had to go with something". She made her determination "on the merits and the credibility of the Appellant but didn't go all the way". She did not speak to Dale Sharbell.
[2159] She also said that to be convinced the Appellant would have had to provide "some form of documentary evidence created at the time". She believed the Appellant, went against the QMP scribblers and since she could not estimate the earnings she gave the Appellant the minimum earnings.
[2160] After sustained questioning by Mr. Rhynes, counsel for the Appellant, she was asked if something could be true and false at the same time. She replied that it would depend on the situation.
[2161] This Appellant gave a truthful account of what took place. The Respondent requested the impossible from the Appellant to prove the QMP scribblers incorrect. The Appeals Officer believed the Appellant when he said he had fished, yet she appears to have disbelieved him when the time came to determine the quantity of fish he had delivered to the Payor. She had not conducted her own evaluation of the validity or accuracy of the QMP scribbler, she relied on what was decided by others. Her hands were tied. The problem was that the Appeals Officer could not render an independent decision. She arbitrarily decided this appeal and gave no valid reason for disbelieving the Appellant as to what was indicated on his DFO slips.
[2162] The able arguments and submissions of counsel John R. Rhynes must be accepted and adopted by this Court as if recited at length in this appeal in particular and in the appeals in general.
[2163] The method adopted in this case showed that no estimate of the Appellant's earnings was even attempted under section 80 of the Regulations.
[2164] No evidence was shown to indicate that the Appellant would have participated in any way in falsifying an ROE or any other document or making false or misleading statements at any time in relation to any claim for unemployment insurance benefits.
[2165] The Appellant has established by a preponderance of evidence that his insurable earnings are those described in his records of employment issued for 1992 and 1993 by the bookkeeper or accountant according to the records kept under section 77 of the Regulations.
[2166] This appeal must be allowed.
29. Myra Harvey
[2167] This Appellant was heard on March 2, 1999. The Appellant, Myra Harvey, in appeal No. 96-2099(UI), as to paragraph 5 of the Reply, admitted the allegations in subparagraphs a) to c), e), h), j) and l). The allegation in subparagraph f) was ignored. The allegation in subparagraph i) was admitted with further explanations to be given at the hearing. The allegations in subparagraphs d), g), k) and m) were denied and disproven by the evidence.
[2168] Exhibit R-37 was filed in the Court record.
[2169] The Appellant explained the use of her boat as follows:
"At the time sir, when I used the boat for fishing oysters I stayed in the boat. I had to be in the boat at all times. And for picking quahaugs I just used a boat to get to where I wanted to pick and to take me back to my vehicle".
(p. 214 of the transcript of March 2, 1999)
[2170] She delivered her catch and was paid in cash.
[2171] She denied the accuracy of the QMP records of the Payor. In 1993, she sold during a period of six weeks to the Payor. The Respondent gave her ten weeks of fishing. Her DFO records and declarations are found in Exhibit R-37, pp. 15 to 25.
[2172] She was cross-examined. She said that she made one delivery to the Payor in a given week in 1993. She would deliver her quahaugs to the Payor to be graded. She would leave them there and go back to the Payor later to pick up her DFO slip and declaration. She had a rough idea of how many quahaugs she dropped off. She could not say whether she went back for her DFO slip the same day, she could not remember. No percentage of 25% was taken or deducted from her DFO slips because she did not use a boat to pick her quahaugs. She did not know what the 25% meant.
[2173] She said that her husband also fished quahaugs. He did not fish in the same area and she did not make her deliveries at the same time. She did not deliver any fish for her husband and he did not deliver fish for her.
[2174] In 1993, she required 10 weeks to be eligible for benefits. She had six weeks with the Payor, three weeks with Garry Wilson and one week with Burleigh Brothers. Once she had her 10 weeks she stopped fishing. She kept no other records of her days of fishing or what she fished and she never had any problems with her fishing.
[2175] The Appellant was represented by Virginia L. Kennedy, another Appellant, who cross-examined the Appeals Officer at the hearing of November 30, 1999.
[2176] The difficulty in this case was that the Appeals Officer who actually prepared this appeal, Don MacLean, was not present and could not be made available at the hearing. Lynn Loftus, the main Appeals Officer, was offered by the respondent to be heard.
[2177] It was pointed out by the Appellant that the Appeals Officer indicated in his report on page 4 (Exhibit R-37, p. 39) that she had fished in partnership with her spouse as stated in a questionnaire that she had filled out. The questionnaire (Exhibit R-37-2) indicates that she always fished by herself.
[2178] Lynn Loftus could not give any more details than those in the report of Mr. MacLean (Exhibit R-37, pp. 37 to 42).
[2179] This Appellant was truthful and was not contradicted. No evidence showed that she participated in falsifying records of employment or other documents or making false statements in relation to a claim for unemployment insurance benefits.
[2180] The Appellant has established by a preponderance of evidence that her insurable earnings are those described in her record of employment issued for 1993 by the accountant according to the records kept under section 77 of the Regulations.
[2181] This appeal must be allowed.
30. Terry Smith
[2182] This Appellant was heard on March 2, 1999. The Appellant, Terry Smith, in appeal No. 96-2102(UI), as to paragraph 5 of the Reply, admitted the allegations in subparagraphs a), b), i) and j). The allegation in subparagraph f) was admitted with further explanations to be given at the hearing. The allegations in subparagraphs c) to e), g), h) and k) were denied and disproven by the evidence.
[2183] Exhibit R-38 was filed in the Court record.
[2184] The Appellant did not fish eels at all in 1993. He fished quahaugs and sold to Leslie Hardy. He did not deliver to the Payor in 1993. He denied that the Payor's QMP records included any purchases made from him.
[2185] The Appellant was cross-examined. He delivered oysters and quahaugs to Leslie Hardy. He admitted that he required 10 weeks to qualify for benefits. He kept no records of the dates he fished, of where he fished in 1993 and for the deliveries he made to Leslie Hardy.
[2186] He was shown a page from the Payor's QMP scribbler (Exhibit R-38, p. 13). He first saw this document at the interview he had with Lew Stevenson. He never sold to the Payor in 1993 and he is positive about it. He sold eels to the Payor in 1992. He also said that no one delivered fish for him to the Payor in 1993.
[2187] The Appeals Officer, Rosie Ford, was heard on November 29, 1999. She stated there was no record of employment or DFO slips from the Payor for the Appellant in 1993. She was shown a page of the Payor's QMP scribblers (Exhibit R-38, p. 13) where two names appear, Terry Smith and Lorne Noye. She was asked who these deliveries belonged to. She did not know where Hog Island and Enmore were situated. She said that she had spoken to Lorne Noye over the telephone. Lorne Noye advised the Appeals Officer that he had never sold to Sharbell and did not know Terry Smith.
[2188] The Appeals Officer allocated earnings to this Appellant based only on the reliability of the QMP scribblers.
[2189] This Appellant gave truthful and acceptable evidence. His evidence was not contradicted. No evidence showed that this Appellant would have participated in the falsification of records of employment or any other documents in relation to any unemployment insurance claim.
[2190] This was another case where no estimate of earnings was carried out under section 80 of the Regulations.
[2191] The Respondent created here an insured person who clearly could not be insured. The Appellant was not recorded in the 1993 records to be kept by the employer in accordance with section 77 of the Regulations.
[2192] The Appellant has established on a balance of probabilities that he had no insurable earnings with the Payor in 1993.
[2193] This appeal must be allowed.
31. Kevin Robinson
[2194] This Appellant was heard on March 2, 1999. The Appellant, Kevin Robinson, in appeal No. 96-2124(UI), as to paragraph 4 of the Reply, admitted the allegations in subparagraphs a), b), g) and h). The allegations in subparagraphs c), e) and f) were ignored. The allegations in subparagraphs d), i) and j) were denied and disproven by the evidence.
[2195] Exhibits R-39, R-39-1 to R-39-3 were filed in the Court record.
[2196] The only earnings this Appellant had from the Payor was one delivery of oysters to the Payor (Exhibit R-39, p.20). He had nine other weeks and a record of employment from Milligan Fisheries Ltd. (Exhibit R-39, p. 13).
[2197] He was cross-examined as to his tax return for 1993 (Exhibit R-39, p. 21). The Appellant explained his expenses. He said he had a good accountant. His income and expenses are not the same every year. He denied having fished and delivered eels to the Payor.
[2198] The Appellant received a letter from HRDC dated February 20, 1996 (Exhibit R-39, p.6). The first paragraph of this letter indicates that HRDC requested a ruling from the Respondent regarding the insurability of the Appellant's earnings with the Payor for October 23, 1993 and how the Appellant is an insured person from May 9 to May 29, 1993. The letter goes on to explain how the Appellant's earnings were allocated to these weeks in May of 1993. There is no mention of the Appellant's earnings for October 23, 1993. On March 2, 1996, he filed an application for determination of a question regarding insurable employment (Exhibit R-39-1). In this document he identified the date of decision of HRDC as February 20, 1996. He also indicated the dates from October 18 to October 23, 1993 under the heading "period for which the determination be made".
[2199] The Respondent, as a result, made a decision dated September 25, 1996 (Exhibit R-39, p. 5). In this document, the Respondent indicates that for the period of October 18 to October 23 of 1993, the Appellant had no insurable earning. There is no mention of the insurable weeks allocated in May by the Rulings Officer.
[2200] At the hearing counsel for the Respondent asked the Appellant why he had not appealed the allocation of earnings for three weeks in May, as decided by the Rulings Officer and outlined in the letter sent to him from HRDC on February 20, 1996 (Exhibit R-39, p. 6). The Appellant was of the view that when he appealed the ruling dated February 20, 1996 (Exhibit R-39-1), he was appealing the three insurable weeks in May and the week of fishing in October.
[2201] The Appellant admitted that in addition to the delivery of oysters he made to the Payor in 1993, he also delivered oyster to Burleigh Brothers. He could not recall when he fished those oysters. He did not receive a stamp for that delivery because he had the ten stamps that were required. He also said that if you did not request a stamp your did not receive it. In other words a sale was made by the Appellant to this buyer which was not considered for unemployment insurance purposes. The Appellant, however, received a statement of fishing income from the buyer (Exhibit R-39, p. 23). He said that in May of 1993 he did not deliver any eels to the Payor for someone else. He did not keep any other records but his DFO slip. When he sold to the Payor, he was paid in cash and received his DFO slip at the same time.
[2202] The Appeals Officer, Patricia Griffin, was heard on November 30, 1999.
[2203] She was asked if she was aware that the QMP scribblers were made up once every ten days or two weeks. Her understanding was that the Department of Fisheries and Oceans reviewed the QMP scribblers when they were done.
[2204] She was shown the Appellant's T4 supplementary for 1993 received from two buyers, Burleigh Brothers Seafood and Sharbell's Fish Mart (Exhibit R-39, p. 23 and 24). She argued that no unemployment insurance premiums were deducted for the earnings from Burleigh Brothers Seafood and some were deducted from the earnings from the Payor.
[2205] The Appellant questioned why the deliveries in the QMP scribbler (Exhibit R-39, p. 15) were not included in his T4 slip from the Payor in 1993?
[2206] The Appeals Officer said that the DFO slip dated October 23, 1993 (Exhibit R-39, p. 14) was not allowed because it did not show up in the QMP scribbler.
[2207] The Appeals Officer admitted that she originally took for granted that the Appellant was appealing the total 1993 year which included the insurable weeks that were awarded to him by the Rulings Officer in May and not only the October week as suggested by counsel for the Respondent at the hearing in March 1999. The Appeals Officer admitted that she had prepared her report on the basis of the position taken by the Appellant at the hearing. Her original report, however, was amended by the Chief of Appeals and done over to deal with the one week of October 23, 1993.
[2208] This evidence and the exhibits would support the position of the Appellant that he was appealing on March 25, 1996 (Exhibit R-39-1), the decision dated February 20, 1996 (Exhibit R-39, p. 6). In this last document, HRDC requested a ruling on the insurability of the Appellant's earnings for the week of October 23, 1993. In the same letter, the Appellant is told that the Respondent had allocated earnings in May. They do not specify what they did with his earnings for October. Because the Appellant in his application to appeal to the Respondent (Exhibit R-39-1), specified that he was appealing the decision of February 20, 1996, but defined the period on the form, from October 18, 1993 to October 23, 1993, the Minister took the view that the Appellant had not appealed the Rulings Officer's decision to allocate the Appellant's earnings in May. The Appellant said that he never sold any fish to the Payor in May of 1993 but delivered in October 1993.
[2209] The evidence showed that this Appellant appealed the Rulings decision, which in essence did not uphold the Appellant's record of employment for the earnings and the week of October 23, 1993, therein described (Exhibit R-39, p.12). Therefore, the Appeals Officer's duty was to determine whether the Rulings Officer's decision to modify the earnings as described in the record of employment was correct. That would require the Appeals Officer to review the week in the records of employment and what had been decided by the Rulings Officer who allocated the Appellant's earnings in May. The Appeals Officer, Patricia Griffin, was correct in her approach as to what the gist of the appeal was, and the Chief of Appeals should not have made her amend her report and limit the appeal to what he considered the desire of the Appellant.
[2210] This approach however, by the Minister is indicative of how careful one should be when dealing with unrepresented Appellants. This Appellant had only one week of earnings from the Payor in October of 1993. When he received the ruling decision, his earnings were allocated for the month of May. He sent in a form (Exhibit R-39-1) to appeal the decision.
[2211] Because he did not put the word "May" on the form, the Chief of Appeals incorrectly decided that he had not appealed the Rulings Officer's decision of February 20, 1996 allocating earnings in May, and ordered the Appeals Officer Patricia Griffin to amend her report.
[2212] Curiously, this unrepresented Appellant was the person who requested that the Appeals Officer who had decided his appeal be heard to which counsel for the Respondent so streneously objected, as may be seen in the transcripts of the hearings in April of 1999.
[2213] May I add that it was at this juncture that the Court requested that each lawyer acting for certain Appellants act as amicus curiae, to help the Court in advising unrepresented Appellants. The Court also insisted that the Respondent ensure the presence of the necessary Appeals Officers for the November scheduled hearings.
[2214] Further had the Appeals Officer, Patricia Griffin, not been heard the Appellant and the Court would have never been aware of what took place since nowhere in her final report is there any mention of her original position.
[2215] The submissions of the Respondent which refer timidly to initial confusion as for which weeks Mr. Robinson had appealed and that the Minister had no objection to opening up the period under review, do not cure the situation revealed in this appeal. There was no confusion in the mind of Paricia Griffin, the Appeals Officer, who testified she made the initial decision and was requested by the Chief of Appeals to change it.
[2216] The Chief of Appeals was present and sat in on all the hearings at the specific request of counsel for the Respondent. He could have testified and explained his reasons for taking the position he took in this appeal. He could also have explained how he may have directed the other Appeals Officers in their decisions in particular and in addition as to what directives were given as to the use of the QMP scribblers.
[2217] This Appellant had cause for apprehension which appears to have initiated his and other requests to have present the Appeals Officers who had actually made the decisions in their files instead of relying on the initial suggestion of counsel for the Respondent who was of the view that only Lynn Loftus and Rosemarie Ford would be sufficient for cross-examination purposes.
[2218] This Court never comprehended the insistent reluctance of the Respondent to accept the Court's suggestion to have certain Appeals Officer available for the hearing in November 1999 especially for the unrepresented Appellants such as this Appellant Kevin Robinson.
[2219] One must realize that the appeal in the Tax Court of Canada deals with the particular decision of the individual Appeals Officers who made the decision.
[2220] The Respondent should provide the presence of Appeals Officers at every appeal hearing unless the Appellant, fully advised of his or her rights, renounces to having such presence.
[2221] If this had been done in these appeals the Court would have saved precious time in April 1999 and counsel for the Respondent would not have placed themselves in the uncomfortable position they initially chose to adopt at the hearing.
[2222] Fortunately, they changed their initial position and accepted to make possible the presence of certain Appeals Officers. The Court then considered the matter closed.
[2223] This restricted approach of the Chief of Appeals as pleaded by counsel for the Respondent would effectively have resulted in the Appellant not being before the Court for the allocation of earnings in May stemming from his earnings in October, as described in his 1993 record of employment.
[2224] The Appeals Officer did not appear to review the pay record of the Payor for 1993 in dealing with this appeal. The only payroll record found in the exhibits for this Appellant is for the year 1992 (Exhibit R-39, p. 16). This page is identical to the original page 140, found in Exhibit R-20, volume 3, which was filed at the hearing by Dale Sharbell on January 25, 1999.
[2225] The evidence given by the Appellant must be accepted. He was a truthful witness. No evidence showed that he participated in falsifying records of employment or other documents or making false statements in relation to any claims for unemployment insurance benefits.
[2226] The insurable earnings of this Appellant for 1993 are those described in his ROE issued by the accountant according to the records kept under section 77 of the Regulations.
[2227] This appeal must be allowed.
32. Roy Parks
[2228] This Appellant was heard on March 3, 1999. The Appellant,Roy Parks, though his agent, in appeal No. 96-2126(UI), as to paragraph 4 of the Reply, admitted the allegations in subparagraphs a) to c), e), h), j) and k). The allegations in subparagraphs d), f), g), i) and l) were denied and disproven by the evidence.
[2229] Exhibits R-40 and R-40-1 to R-40-7 were filed in the Court record.
[2230] The period in question in this appeal is from August 27 to October 29, 1993.
[2231] The Appellant used a boat to make his catches but was not the owner.
[2232] During the period in question, the Appellant had 11 weeks of fishing: four weeks of eel fishing and seven weeks of flounder fishing and the record of employment was incorrectly completed. It should reflect 11 weeks instead of 10. The extra week of fishing was August 20 as may be seen on the DFO slip (Exhibit R-40, p. 13). He admitted that the record of employment (Exhibit R-40, p. 11) was in that respect incorrect but he did not know it until the interview he had during the investigation. His position is that he should have insurable earnings for 11 weeks at the maximum of $745.00.
[2233] In cross-examination, he admitted that in box 8 of his record of employment (Exhibit R-40, p. 11) the first day of fishing should be August 20, 1993 instead of the 27.
[2234] The Appellant fished eels and flounder in 1993. He delivered flounder roughly 3 times a week. He was given a slip of paper with the weight marked on it. He would then come in at the end of the week with his slips of paper. At that time he would be paid and receive his DFO slip. He filled out his fishermen's declaration when he received his DFO slip at the end of the week.
[2235] The eels would be delivered once a week. He would receive a DFO slip, fill out a declaration and be paid at that time. He did not record the amounts indicated on the slip of paper and the DFO slip would give him his total poundage.
[2236] He was cross-examined as to QMP scribbler (Exhibit R-40, p. 28). He saw this document for the first time at an interview with the investigators of HRDC in 1995 or 1996. He said that he did not believe he sold any eels to the Payor after the 17th of September.
[2237] The Appellant filed three DFO slips (Exhibit R-40-1) which were not in the Respondent's main Exhibit (Exhibit R-40) and that correspond to three weeks of fishing indicated on his record of employment: October 15, 22 and 29, 1993 (Exhibit R-40, p. 11). These documents were not in the Appeals Officer's report. This witness also said, being questioned further by the Court, that the DFO slip always showed the gross earnings. When he got paid the unemployment premiums would be deducted by the buyer before he was remitted his money.
[2238] The Appeals Officer, Patricia Griffin, was heard briefly and was cross-examined by Catherine Parks, on November 30, 1999. She said that she learned from the master file that there was no QMP requirement for flounder sold to fish plants. She was not aware as suggested to her by the Appellant that there was no QMP's requirement for eels.
[2239] When examining the pay records of the Payor for 1993 (Exhibit R-40, p. 29) no entry was made by the accountant for DFO slip No: D333385, dated August 20, 1993 (Exhibit R-40, p. 13) and no indication of that sale was made on the record of employment (Exhibit R-40, p. 11). This was of no fault or making of the Appellant as he explained to the Appeals Officer and noted by her in the summary of her report (Exhibit R-40, p. 43). As for the rest, the Payor's records are complete and all the Appellant's sales are accounted for.
[2240] The Appellant filed a document dated November 1, 1999 (Exhibit R-40-5) which was sent to him by Mr. Don Love, the Regional Supervisor for Fish Inspection of the Department of Fisheries and Oceans. The document deals with the QMP program which is the subject of much concern in this appeal.
[2241] The Appellant was represented by his wife. He filed as if recited at length herein a letter dated November 4, 1996 (Exhibit R-40-2) which is a reply to the letter he received from HRDC on October 10, 1996 (Exhibit R40-4).
[2242] This Appellant was a truthful witness. He was not contradicted. No evidence showed that he participated in any way in falsifying any records of employment or any other documents or making false statements in relation to any claim for unemployment insurance benefits.
[2243] The Appellant has established on a balance of probabilities that his insurable earnings for 1993 are those contained in his ROE prepared by the accountant according to the records kept by the Payor under section 77 of the Regulations.
[2244] This appeal must be allowed.
33. Judy A. Coughlin
[2245] This Appellant was heard on March 3, 1999. The Appellant, Judy A. Coughlin, in appeal No. 97-5(UI), as to paragraph 4 of the Reply, admitted the allegations in subparagraphs a) to c), e), k) and l). The allegation in subparagraph f) was ignored. The allegations in subparagraphs d), g) to j) and m) were denied. The allegations in paragraphs 5 and 6 of the Reply were admitted and disproven by the evidence.
[2246] Exhibits R-41 and 41-1 were filed in the Court record.
[2247] The Appellant fished bar clams in 1992 and eels in 1993. She used a boat in 1993 but not in 1992. She delivered to the Payor in 1992 and 1993. In 1992, the Payor issued a record of employment for three insurable weeks (Exhibit R-41, p. 11). In 1993, the Payor issued a record of employment to the Appellant reporting one insurable week.
[2248] In 1993, she fished eels and used a boat. The DFO slip No: D331432 found on page 15 of Exhibit R-40 would appear to correspond to the Payor's ledger for this Appellant on page 28 of the same Exhibit R-40. The Appellant admitted that this DFO slip corresponded to one delivery of eels to the Payor. She admitted having no other documents but her DFO slips. She was also asked question with regard to her employment with other Payors, Westech Agriculture Ltd. and Burleigh Brothers. She fished in order to "boost her stamps or maximize her insurable earnings".
[2249] The Appeals Officer in this case was Rosemarie Ford. She was not examined or cross-examined by any of the parties. On November 30, 1999, the Court was advised that the Appellant would have no questions to ask Rosemarie Ford.
[2250] The evidence of the Appellant was truthful and not contradicted. No evidence showed that she would have participated in falsifying ROE's or made false statements in relation to any claim for the purpose of obtaining unemployment insurance benefits.
[2251] This Appellant has established on a balance of probabilities that her insurable earnings are those contained in her ROE's for 1992 and 1993 as prepared by the bookkeeper or accountant according to the records kept by the Payor under section 77 of the Regulations.
[2252] This appeal must be allowed.
34. Cindy Bulger
[2253] This Appellant was heard on March 3, 1999. The Appellant, Cindy Bulger, in appeal No. 96-2190(UI), as to paragraph 6 of the Reply, admitted the allegations in subparagraphs a) to c), e), h), j), k), m) and n). The allegation in subparagraph f) was ignored. The allegations in subparagraphs d), g), i), l), o) and p) were denied and disproven by the evidence.
[2254] Exhibits R-42, R-42-1 and R-42-2 were filed in the Court record.
[2255] The periods in question in this appeal are August 8 to October 10, 1992 and the week of July 30, 1993, when delivering fish to the Payor.
[2256] She stated that the documentation she had to show that she delivered to the Payor were her DFO slips (Exhibit R-42, pp. 14 to 20 and p. 31).
[2257] She met with the Appeals Officer, Elizabeth Whyte, and gave her a copy of a receipt she had found (Exhibit R-42-1).
[2258] In cross-examination, she was asked why some amounts delivered for certain weeks were the same? She said that when she delivered she would have a rough idea of how much money she would be receiving.
[2259] In 1992 and 1993, she would deliver her oysters at the end of the week. She would receive a DFO slip and be paid on the day she delivered her oysters.
[2260] She delivered clams more than once a week even though her DFO slip would indicate the quantity for the entire week.
[2261] She did not keep a record of when she fished and did not keep a personal record of how much fish she delivered to the Payor. She was able to find one slip of paper for one delivery. She gave a copy of the slip to Elizabeth White, the Appeals Officer (Exhibit R-42-1).
[2262] She also said that if she lost the piece of paper she was given by the buyer, Dale Sharbell would have it recorded "in his shirt pocket on a pad paper".
[2263] She said she used a boat for transportation only and not for fishing.
[2264] At the request of the Court, the witness explained that when she brought her oysters to Burleigh Brothers, another Payor, she would leave her oysters at the plant, her name would be written on the top of the boxes and at the end of the week she would attend this Payor's premises to pick up her DFO slip.
[2265] She said that her insurable week was for $610.00. The Respondent allowed her the week for 1993 but at the minimum amount of $149.00. The Appellant stated that in a conversation she had with the Appeal's Officer, Elizabeth White, she was informed that the reason for allowing her a minimum week of insurable earnings for 1993, was that her name did not appear in the Payor's QMP scribbler. The Appeals Officer however believed that she had fished but did not allow the amount indicated in the DFO slip.
[2266] For the 1992 year, the Appellant was told that certain weeks of her earnings were allowed according to the amounts in the DFO slips. Other weeks were allowed for the minimum amount of insurable earnings because the QMP scribbler was not accurate. The Appellant then wondered if they believed her for some weeks why not for the others?
[2267] The Appellant was heard again on March 4, 1999. She filed a receipt from the Payor (Exhibit R-42-1) dated July 27, 1993. There was no indication on the receipt what it was for. She said it represented a receipt for 175 pounds of clams. This could be part of her deliveries for which she received a DFO slip at the end of the week of July 30, 1993, as shown on her declaration (Exhibit R-42, p. 30).
[2268] The Appeals Officer, Elizabeth Whyte, was heard on December 2, 1999.
[2269] The Appellant pointed out to the Appeals Officer that her name was not in the QMP scribbler for both 1992 and 1993 years. The Appeals Officer stated that she relied on the QMP as the most reliable records for certain periods as she had said in previous appeals.
[2270] In fact, for the 1992 year, the Appeals Officer confirmed her seven weeks of fishing, but reduced to a minimum the weeks of August 22, September 26 and October 8, 1992. She admitted that there was evidence to establish that the Appellant delivered the catches, but did not accept the amount of the deliveries because of the reliability of the QMP scribbler (See Exhibit R-42, p. 60).
[2271] For 1993, the Appeals Officer, concluded that the benefit of the doubt was given to the Appellant to the effect that she delivered the catch on July 31, 1993, but did not allow the DFO slips as to the amount of the delivery.
[2272] This Appellant was not contradicted, she was a truthful witness. Nothing in the evidence showed that this person would have participated in falsifying a record of employment or any other document, as giving false statements in relation to any claim for unemployment insurance purposes.
[2273] The Appellant has proven on a balance of probabilities that her insurable earnings are those represented on her ROE's for 1992 and 1993 as prepared by the bookkeeper and the accountant in accordance with the records kept by the Payor under section 77 of the Regulations.
[2274] This appeal must be allowed.
35. Richard B. Kennedy
[2275] This Appellant was heard on March 3, 1999. The Appellant, Richard B. Kennedy, in appeal No. 96-2236(UI), as to paragraph 8 of the Reply and amended Reply, admitted the allegations in subparagraphs a) to c), e), h) to l) and s). The allegations in subparagraphs o) and p) were admitted with explanations to be given at the hearing. The allegations in subparagraphs f) and g) were ignored. The allegations in subparagraphs d), m), n), q), r), t) and paragraph 10 were denied and disproven by the evidence.
[2276] Exhibits R-43, R-43-1, R-44 and R-44-1 were filed in the Court record.
[2277] The Appellant advised the Court in agreement with the Respondent that the appeal should also deal with the 1993 pay period of the Appellant. The Respondent filed amendments to the Respondent's Reply to the Notice of Appeal to reflect the 1993 work period. The Appellant stated that he did not make any deliveries to the Payor in 1993 and that documentation he had to substantiate his deliveries to the Payor for the week ending on October 10, 1992 were his DFO slips. At a meeting with Rosemarie Ford, the Appeals Officer in early September of 1996, he submitted in addition a series of receipts for gas, oyster gloves and truck parts to show that he did fish.
[2278] He was cross-examined as to the entries made on his record of employment for 1992 and the DFO slips which were delivered to him by the Payor. It appeared that the last day of delivery to the Payor in 1992, would have been October 8 (Exhibit R-43, p. 15). The record of employment issued by the Payor indicates the date of last purchase as being the October 10, 1992 (Exhibit R-43, p. 11).
[2279] He was also cross-examined as to his fishing and deliveries to other buyers. He said that he did not fish with his wife, that he did not split his catch with her and did not deliver any fish to the Payor for her. His wife did not deliver any fish for him to the Payor. He never made a delivery for which he did not receive a DFO slip. This witness had a question to put to Rosemarie Ford, Appeals Officer, (CPT 110, 1993, R-43, p. 55).
[2280] The Appeals Officer, Rosemarie Ford, was heard on November 29, 1999. She admitted having told the Appellant that she would do her best to have his October 10, 1992 week re-installed if he provided receipts to her. She admitted that he faxed receipts to her and that she allowed a partial week and not the maximum amount which was reported on the Appellant's DFO slip. The reason she did this was that she accepted that he had fished, but the Appellant's delivery was not recorded in the QMP scribblers and she could not confirm the amount of his delivery. She did however allow four other weeks because the QMP scribblers were not reliable and she gave the benefit of the doubt to the Appellant for those weeks in 1992.
[2281] In 1993, the Appellant was allocated weeks of earnings because his name did appear in the QMP scribblers. The Appellant however received no DFO slips or ROE from the Payor in 1993. He was accorded earnings based on the reliability of the QMP scribbler.
[2282] The Appeals Officer was questioned as to the statement contained in her report which is stated in Exhibit R-43, p. 55, as follows:
"It is believed fisher persons sell their catch for cash if they don't need the sale of the delivery to make an insurable week or sell the catch in someone else's name who does."
[2283] She was asked what she relied upon to make that statement and she replied, that it was hearsay.
[2284] Nothing in this Appellant's evidence would show that he should not be believed. He was not contradicted and gave a truthful account of what took place. No evidence showed that this Appellant would have participated in falsifying records of employment or other documents or made false statements in relation to any claim for unemployment insurance benefits.
[2285] It has been proven on a balance of probabilities that the insurable earnings of the Appellant for 1992 are those described in his ROE as recorded by the bookkeeper in accordance with the records kept under section 77 of the Regulations.
[2286] The Appellant has proven on the balance of probabilities that he did not sell to the Payor in 1993 as no DFO slips were issued to him and no ROE was issued to him by the Payor's accountant. He had no insurable earnings for that year.
[2287] This appeal must be allowed.
36. Virginia L. Kennedy
[2288] This Appellant was heard on March 3, 1999. The Appellant, Virginia L. Kennedy, in appeal No. 96-2257(UI), as to paragraph 8 of the Reply, admitted the allegations in subparagraphs a) to c), e), h) and j). The allegations in subparagraphs f) and g) were ignored. The allegations in subparagraphs d), i) and k) were denied and disproven by the evidence.
[2289] Exhibits R-45, R-45-1 to R-45-4 were filed in the Court record.
[2290] The period under review for this Appellant was from August 22 to September 25, 1993 with regards to her insurable earnings of three weeks with the Payor.
[2291] The various records of employment of this Appellant may be found in Exhibit R-45, at pages 11 to 14. The records of employment for fishing were based on the DFO slips given to the Appellant by the various buyers.
[2292] The Appellant during the 1993 year also worked as a labourer.
[2293] The Appellant had no knowledge prior to the enquiry on this matter of the existence of the QMP records of the Payor.
[2294] The Appellant stated that she fished in the afternoons and evenings after her day of work at St-Andrews Day Care, where she worked from September 13 to October 8, 1993 (Exhibit R-45, p. 13). She delivered her fish to the Payor. She received her DFO slips from the Payor on August 28, September 18 and September 25, 1993. She explained, in cross-examination, how she fished and delivered her catches and what she was doing at other times.
[2295] She also explained how she arranged to have a babysitter at home for the children. It was either her husband or the grandparents or other relative that helped out. She was not able to afford to pay for a babysitter.
[2296] She also explained why she did only deal with one fish buyer. She delivered quahaugs to the Payor. She would know how many she picked because she counted them. The Appellant was paid in cash and the buyer would withhold the unemployment insurance premiums. She did not keep any other records of her days of fishing or her days of delivery except the DFO slips. She delivered her own product. She did not deliver for anybody and nobody delivered for her.
[2297] The witness also filed a two-page document dated February 1995 from Revenue Canada with reference to Fisherperson's Declarations (Exhibit R-45-3). She also filed a blank Fisherman's Declaration Form (Exhibit R-45-2).
[2298] She explained to the Court what her understanding was of a Fisherman's Declaration, in 1993, when she fished.
[2299] She maintained that she delivered her fish to the Payor, she signed her declaration, received her DFO slip for her deliveries, was paid and should be insurable for the weeks and the amounts indicated in her record of employment with the Payor (Exhibit R-45, p.11).
[2300] The Appeals Officer, Rosemarie Ford, was heard on November 30, 1999. The Appellant was sent a letter on December 21, 1995 and there was no reply by February 26, 1996. The Appeals Officer confirmed that there is no note in the file on February 29, 1996 indicating that the Appellant would have contacted a Mrs. Younker.
[2301] The Rulings Officer decided that the Appellant had no earnings with the Payor because her name did not appear in the QMP scribbler.
[2302] The Appeals Officer said that she looked at all the documentation she received. The Appeals Officer confirmed the Rulings Officer's decision.
[2303] The evidence of this Appellant was not contradicted, was truthful and must be accepted. No evidence showed that this Appellant would have participated in falsifying records of employment or other documents or made false statements in relation to any claim for unemployment insurance benefits.
[2304] She has demonstrated on a balance of probabilities that her insurable earnings for 1993 are those described in her ROE as prepared by the Payor's accountant in accordance with section 77 of the Regulations.
[2305] This appeal must be allowed.
37. Darryl MacIntyre
[2306] This Appellant was heard on March 3, 1999. The Appellant, Darryl MacIntyre, in appeal No. 96-2304(UI), as to paragraph 5 of the Reply, admitted the allegations in subparagraphs a) to c), e) and k). The allegations in subparagraphs h) to j) were admitted with further explanations to be given at the hearing. The allegation in subparagraph f) was ignored. The allegations in subparagraphs d), g) and l) were denied and disproven by the evidence.
[2307] Exhibits R-46 and R-46-1 were filed in the Court record.
[2308] The record of employment for this Appellant with the Payor (Exhibit R-46, p.12) indicates three weeks of fishing from July 22 to September 9, 1993.
[2309] The Minister determined that the Appellant had insurable earnings for 11 weeks as outlined in the Appeals Officer's report (Exhibit R-46, p. 41). The main reason being that the QMP records were reliable.
[2310] The Appellant said that he did not fish eels in 1993. He used a boat in making his catches of oysters but did not use a boat for fishing quahaugs.
[2311] He delivered quahaugs to the Payor in 1993. He sold to the Payor on three occasions in 1993 represented by the three DFO slips and declarations, found on pages 15 to 20 of Exhibit R-46.
[2312] In cross-examination, he said that each DFO slip represents one delivery. He left his quahaugs at the Payor's premises and waited till they were graded. The quahaugs would have been fished over a period of time.
[2313] His wife, Paula Rayner, also fished and is one of the Appellants. They did not deliver together. He did deliver her fish but she was with him.
[2314] He did not record but he counted his quahaugs before he delivered them to the Payor. He also compared his DFO slip to his count. He did not keep any other documentation except the DFO slip. After his 10 weeks of fishing, he stopped fishing because he did not feel it necessary to continue fishing any longer.
[2315] The Appeals Office, Lynn Loftus, was heard in this appeal on November 29, 1999.
[2316] The Appellant referred the Appeals Officer to Exhibit R-64, tab. 15, p.1).
[2317] It was pointed out to the Appeals Officer that the DFO statistics reported purchases of quahaugs of 110,639 pounds and the QMP scribblers total was 828,149 units. The Appellant who fishes quahaugs submitted to the Appeals Officer that if you convert the units into pounds by averaging the weight of small, medium and large, that the DFO purchases would be closer to the sales than what was reported in the Payor's QMP scribblers. The Appeals Officer agreed with the Appellant that in his calculations the DFO purchases were closer to the sales than the QMP scribbler purchases. The Appeals Officer also pointed out that she did not average the weight. In fact, the Appeals Officer in her CPT 110, common information, (Exhibit R-64, tab.11, p. 12) stated that it was not possible to do a comparison because quahaugs and oysters were not purchased in pounds but in pecks. The sales, however, were recorded in pounds.
[2318] The Appeals Officer admitted that she was not sure what was right and what she did was the lesser of two evils. What she meant by this was that in choosing the QMP scribblers, it was a lesser evil than going by the DFO slips. She admitted that if she had known that the DFO slips figures were closer to the sales figures, she would have changed her mind.
[2319] The Appeals Officer, Lynn Loftus, was questioned again by the Appellant on December 1, 1999. She stated that when she did her volume analysis she decided that the QMP scribblers were not accurate and she "adopted Robbin's formula".
[2320] She explained the document she prepared (Exhibit R-64, tab. 15, p. 1). She referred to the 32,000 pounds of eels which were the sales indicated on the Payor's annual export out of province report dated January 17, 1995 (Exhibit R-22, p. 2). The Appellant asked her whether the purchases of 52,256 pounds indicated on the DFO slip purchases were closer to the sales exported than the 60,284 pounds of eels purchased indicated in the QMP scribblers. She said that the DFO purchases would be closer.
[2321] She said that she did not use the chart on page 2 of tab. 6 in Exhibit R-64.
[2322] This Appellant referred the Appeals Officer to the 828,149 quahaugs reported in her analysis (Exhibit R-64, tab. 15, p. 1). He indicated to her that, according to his calculations, 828,149 units of quahaugs (indicated on QMP purchases), if they were all small quahaugs would amount to 138,025 pounds. She admitted that in such a case the DFO purchases of 110,639 would be closer to the sales than the purchases indicated in the QMP scribblers.
[2323] The cross-examination of Lynn Loftus, the Appeals Officer, by the Appellant demonstrated that the Respondent's comparisons of the purchases of eels and quahaugs with sales was not as accurate as one would wish. No explanation was given as to how the Payor made up his annual report for exports (Exhibit R-22) for 1993 on January 27, 1995. This Appellant had the main Appeals Officer admit that the DFO slip purchases of the buyer could be closer to the sales which contradicted the Respondent's conclusions as to the reliability of the QMP scribblers.
[2324] This Appellant was truthful and was not contradicted. No evidence showed that this Appellant would have participated in any way in falsifying records of employment or for that matter any other document in relation to any claim for unemployment insurance benefits.
[2325] The insurable earnings of this Appellant are those contained in the ROE for 1993 issued to the Appellant by the Payor's accountant according to the records kept by the Payor in accordance with section 77 of the Regulations.
[2326] This appeal must be allowed.
38. Loretta Ross
[2327] This Appellant was heard on March 3, 1999. The Appellant, Loretta Ross, in appeal No. 96-2437(UI), as to paragraph 6 of the Reply, admitted the allegations in subparagraphs a) to c), e), h) and j). The allegations in subparagraphs d), f), g), i) and k) were denied and disproven by the evidence.
[2328] Exhibits R-47 and R-47-1 were filed in the Court record.
[2329] The record of employment for this Appellant with the Payor (Exhibit R-47, p.11) indicates two weeks of fishing from October 3 to October 10, 1992.
[2330] The Minister determined that the Appellant had no insurable earnings with the Payor as outlined in the Appeals Officer report (Exhibit R-47, p.29). The main reason being that the Appellant's name was not recorded in the QMP records of the Payor and during the period under review the QMP records were accurate since they agreed with the sales invoices of the Payor from July 18 to October 31, 1992.
[2331] The Appellant said in answer that she did make deliveries of oysters to the Payor in 1992. She received a record of employment for two insurable weeks.
[2332] She was cross-examined and stated that she was formerly Loretta Bulger. She did not think she was related to any of the Appellants in this case.
[2333] Her weeks of fishing were called "dual weeks" because she was using those earnings to top up weeks of earnings she had with another Payor. It was a second job for her.
[2334] She worked as a labourer and also sold fish to Fisherman's Pride Inc. (Exhibit R-47, pp. 12 and 13). She sold oysters and clams to this Payor. She sold oysters to Sharbell. She did not fish with anybody else and did deliver with her husband, Tim Ross. He did not make deliveries for her and never sold fish to the Payor either in 1992 or other years.
[2335] She was shown her DFO slip of October 3, 1992 (Exhibit R-47, pp. 14). This DFO slip was made out by Marilyn Enman who was at the store when the delivery was made.
[2336] The DFO slip for October 10, 1992 (Exhibit R-47, p.14) was picked up by the Appellant at the house of Marilyn Enman in the middle of the following week, when she attended to get her record of employment.
[2337] She was shown pages 16 to 18 of Exhibit R-47 which are copies of calendars for the months of August to October of 1992. These documents show the hours she worked and the amounts. These calendars were probably drawn up from her records of employment. She said that both DFO slips for 1992 were made up by Marilyn Enman. She was paid by Dale Sharbell and unemployment insurance premiums were deducted from the amounts she received.
[2338] She fished her oysters, that she sold to the Payor at Conway Narrows, taken from an area which was leased by her husband in partnership with his brother. She is the only one who fished oysters from the lease in 1992.
[2339] This witness was not contradicted and the dates and amounts of her DFO slips match with the Payor's pay records (Exhibit R-47, pp. 14 and 15).
[2340] The Appeals Officer, Rosie Ford, who was heard in other appeals on November 30, 1999, was the person who made the determination in the case of this Appellant. The Appellant had no questions to put to the Appeals Officer.
[2341] This Appellant was a truthful witness and was not contradicted. No evidence showed that she would have participated in falsifying records of employment or other documents or given false statements in relation to any claim for unemployment insurance benefits.
[2342] The evidence on a balance of probabilities demonstrated that the Appellant's insurable earnings are those described in her ROE as prepared by the bookkeeper for the 1992 year.
[2343] This appeal must be allowed.
39. Nelson Campbell
[2344] This Appellant was heard on March 4, 1999. The Appellant, Nelson Campbell, in appeal No. 96-2096(UI), as to paragraph 6 of the Reply, admitted the allegations in subparagraphs a), b), f), i) and j). The allegation in subparagraph d) was ignored. The allegations in subparagraphs c), e), g), h) and k) were denied and disproven by the evidence.
[2345] Exhibits R-48, R-48-1 and R-48-2 were filed in the Court record.
[2346] The Appellant was a self-employed fisherman in 1992. He fished in the spring of 1992. He fished oysters from May 1 to probably the middle of July.
[2347] The Appellant stated that he did not deliver any catch to the Payor in 1992. No DFO slips or record of employment were issued to him by the Payor for 1992. He did deliver oysters in 1992 to another Payor, Burleigh Brothers, (Exhibit R-48, p. 10).
[2348] In cross-examination, he said that he had a licence to fish oysters in both the fall and the spring. In 1992, he also fished quahaugs in the late part of July or beginning of August. In September of 1992, he said he was not working and was not drawing unemployment benefits because when he was fishing in August the water was bothering him and he was advised to take six weeks off. This condition would have been the result of an accident he had suffered in 1991.
[2349] The Appellant filed seventeen receipts for his account with Burleigh Brothers (Exhibit R-48-1). The Appellant's oysters were picked up at the shore by Burleigh Brothers. He received his DFO slips but was not sure whether he received them at the end of the week or at each pick-up or delivery. The Appellant filed a photocopy of his fishing income and expenses statement date April 28, 1993 (Exhibit R-48-2). He received social assistance payments in the fall of 1992.
[2350] He did not keep a record of the days he actually fished. He kept his DFO, T4 slips and expenses for fishing. He is the brother of Barry Campbell and did not fish with him in 1992. He never delivered his brother's fish. He had no idea whether his brother sold to Sharbell's Fish Mart.
[2351] The Appellant submitted a handwritten note on December 2, 1999 indicating that he had no questions for Patricia Griffin, the Appeals Officer in his appeal.
[2352] Patricia Griffin had testified in other appeals previously. She had not participated in the decision-making process as to the reliability of the Payor's QMP records. She followed what had already been decided by Lynn Loftus and the Chief of Appeals.
[2353] The Appeals Officer allocated earnings to this Appellant based solely on the QMP scribbler pages (Exhibit R-48, pp. 11 to 13).
[2354] There was no record of employment and no DFO slips for any deliveries. This was yet another case where the person had to prove that he did not fish as required by the Appeals Division during their investigation.
[2355] The Appellant was not one of the individuals subject to the content of the letter sent to the Payor on October 3, 1996 (Exhibit R-19) filed by the Respondent on January 25, 1999.
[2356] This Appellant had not been contradicted, his evidence must be accepted. No evidence showed that he should be disbelieved.
[2357] The submissions of this Appellant (Exhibit S-24) are adopted by this Court as if recited at length herein.
[2358] This Appellant has proven on a balance of probabilities that he had no insurable earnings with the Payor in 1992.
[2359] This appeal must be allowed.
40. Arthur C. Coughlin
[2360] This Appellant was heard on March 4, 1999. The Appellant, Arthur C. Coughlin, in appeal No. 96-2442(UI), as to paragraph 6 of the Reply, admitted the allegations in subparagraphs a) to c), e) and h) to l). The allegations in subparagraphs f) and g) were ignored. The allegations in subparagraphs d), m) and n) were denied and disproven by the evidence.
[2361] Exhibits R-49, R-49-1 to R-49-4 were filed in the Court record.
[2362] The records of employment of the Appellant for 1992, with the Payor, indicate four weeks of fishing (Exhibit R-49, pp. 11 and 12).
[2363] The records of employment of the Appellant with the Payor, for 1993, indicate seven weeks of fishing (Exhibit R-49, p. 33).
[2364] The Minister determined that in 1992, the Appellant had one insurable week with the Payor, the week of September 19, 1992 (Exhibit R-49, p. 73). He also decided that in 1993, the Appellant had insurable earnings for 11 weeks (Exhibit R-49, p. 79). Both decisions were based on the credibility of the QMP records.
[2365] The Appellant has been fishing for 35 years. He did not know that the Payor kept a QMP scribbler, he found out about it in September 1996. The eels described on page 15 of the scribbler (Exhibit R-49, p. 15) are not all his because they are all in one area for seven weeks. To fish eels you have to move around. He was shown his DFO slip for his delivery of oysters on September 18, 1992 (Exhibit R-49, p. 14) and said that the DFO slip is what he delivered to the Payor. The DFO slip is in the amount of $972.00. The deduction of 25% was taken off and the Appellant had an insurable week at the maximum of $710.00.
[2366] In 1993, he sold seven weeks to the Payor and received 7 DFO slips (Exhibit R-49, pp. 50 to 53). Copies of those DFO slips were presented to the Investigating Officer.
[2367] He had no reason to believe that the Payor was not keeping proper records (the Minister says that he only earned $2,200.00 in 1993 yet in January of 1994, he bought a new truck).
[2368] The Appellant presented bank deposits at his interview with the Investigating Officers. He filed in the Court record a photocopy of documents from the Consolidated Credit Union Ltd. (Exhibit R-46-1).
[2369] When the investigation began, the Appellant did not think he would have any problems because he had all his DFO slips and separation papers.
[2370] The Appellant filed documentation showing the student loans his daughter obtained in explaining the cost of sending his daughter to university (Exhibit R-49-3).
[2371] In cross-examination, he said that he delivered his oysters daily, or once, or twice a week. When he delivered to the Payor, it would have been twice or three times a week. He did not receive a DFO slip each time he delivered. He was not aware that it was required. He did not keep a personal record of his deliveries or the days he actually fished. He was paid in cash at the time of delivery. The Payor must have kept track of what he was paid. He paid his unemployment insurance premiums at the end of the week. He used a boat when he fished oysters and eels. The 25% deduction for the use of the boat was not taken off; this deduction takes place only for the record of employment.
[2372] He stated that in August of 1992, he was probably working on his cottage. He fished only one week in September 1992.
[2373] He filed copies of the DFO slips he received from the Payor in 1993 (Exhibit R-49-4). He did not fish with anybody else. No one delivered his fish for him and he made no deliveries for anybody else. He did not sell any fish in 1992 or 1993 for which he did not receive a DFO slip. In re-examination, he said that he delivered oysters one, or twice, or may be three times a week and was paid at the end of the week. When he delivered eels daily, he was paid daily. He picked up his DFO's for both eels and oysters and paid his unemployment stamps at the end of the week. In 1998, he worked 12 weeks and he required 12 weeks for employment insurance purposes.
[2374] The Appeals Officer, Rosemarie Ford, was heard in this appeal on November 30, 1999. She explained what information she had when she reviewed the file. Lynn Loftus, another Appeals Officer, completed the diary. She did not interview the Appellant in person. She based her decision on the questionnaire that was filled out and the other documentation.
[2375] The determination was made on October 10, 1996. Other documents would have been sent to the Appeals Officer after the decision but it was too late (Exhibit R-49, pp. 54 to 57). It appeared that once the determination was made, it could not be changed, even if the Appellant would have forwarded additional documentation.
[2376] The Appeals Officer did not check on the Appellant's sales in 1994, because that year was not under appeal.
[2377] In the summary of the Appeals Officer's report, dated October 11, 1996 (Exhibit R-49, p. 73), she indicated the following:
"The worker was issued two separate fishing ROE's (6 weeks apart) from Sharbells - one was for 3 weeks and the other was for 1 week. The second ROE issued from Sharbells was the last ROE worker received and it was for 1 week only which he needed to requalify for UI benefits."
It is believed fishermen can and do buy UI stamps needed to qualify them to draw UI benefits. According to the QMP scribbler worker did have a couple of deliveries during the period in question but it wasn't near enough to give him a maximum insurable week which shows on his second ROE."
[2378] In her report for 1993 dated October 10, 1996, (Exhibit R-49, p. 78), she states in her summary:
"The worker fished oysters and eels and used a boat to do so.
The ROE from Sharbells has worker making 7 deliveries from week ending June 17 to October 22/93, where the QMP has him making 24 deliveries from May 10 to October 14/93.
Worker's UI was finished on May 15, 1993 according to his UI Application.
It is believed fishermen sell their catch for cash if they are drawing UI Benefits and if they don't need the catch for a stamp."
[2379] The implication in this case is that the Appeals Officer suspected this Appellant of selling his catch for cash, while on unemployment insurance benefits and/or buying a stamp needed to qualify him for unemployment insurance benefits.
[2380] No evidence, was shown to support such an inference.
[2381] This Appellant was not contradicted and gave truthful evidence. Nothing was shown to demonstrate that the Appellant would have participated in the falsification of records of employment or other documents or given false statements in relation to any claim for unemployment insurance benefits or selling catches for cash.
[2382] The submissions by Jean Coughlin on behalf of the Appellant (Exhibit S-10) have been reviewed and adopted by the Court and the Court concludes that this Appellant has proven on a balance of probabilities that his insurable earnings are those reported on his ROE's for 1992 and 1993 as prepared by the bookkeeper and the accountant of the Payor respectively, in accordance with the records kept by the Payor under section 77 of theRegulations.
[2383] This appeal must be allowed.
41. Philip Bulger
[2384] This Appellant was heard on March 4, 1999. The Appellant, Philip Bulger, in appeal No. 96-2483(UI), as to paragraph 4 of the Reply, admitted the allegations in subparagraphs a) to c), e), j) and k). The Appellant admitted the allegation in subparagraph h) with further explanations to be given at the hearing. The allegations in subparagraphs d), f), g) i) and l) were denied and his proven by the the evidence.
[2385] Exhibits R-50 and R-50-1 were filed in the Court record.
[2386] The record of employment of the Appellant with the Payor for 1992 indicates 3 weeks of fishing (Exhibit R-50, p. 15).
[2387] The Minister determined that the Appellant had 7 insurable weeks with the Payor based on the accuracy of the QMP scribblers of the Payor (Exhibit R-50, p. 48).
[2388] The Appellant was involved in 1992 with the fishing of oysters only. He did not use a boat in making his catch. He used a boat to get to and from his place of fishing and for transporting his catch. The three DFO slips issued to the Appellant are on pages 18 to 20 of Exhibit R-50.
[2389] The Appellant was cross-examined. He explained having delivered oysters to two other buyers. He admitted that the two DFO slips when compared to the record of employment do not exactly reflect the same dates of delivery. The DFO slips may represent two or three deliveries. The Appellant agreed that he would have delivered oysters two or three times a week. At the end of the week he would receive his DFO slip and be paid at the same time. He explained how he delivered his oysters. He would leave them for grading at the Payor's premises. They were identified with his name. On his next delivery he would get a paper indicating the result of his previous delivery. He kept no records of what he was dropping off. He had an oyster lease and would have documentation as to the oysters he put on his lease in 1992. He did not have them at the hearing. The lease reports would only show estimates of how much oysters he took off his lease. The oysters he sold to different Payors in 1992 did not all come off his lease. Those delivered to the Payor Sharbell were taken off his lease.
[2390] He did not deliver fish for anyone else to the Payor and no one delivered fish to the Payor for him. He is the uncle of Jason Bulger who worked for the Payor. He is the husband of Cindy Bulger. He did not fish with his wife. They fished some days in similar areas. His wife could have picked oysters from his lease in August, September, October of 1992.
[2391] The Appeals Officer, Elizabeth White, testified in the cases of other Appellants on December 2, 1999. The Appellant had no questions to put to her.
[2392] The report of the Appeals Officer dated October 18, 1996 (Exhibit R-50, p. 48) indicated how she allocated the Appellant's earnings, according to the reliability of the QMP records or scribblers unless proven otherwise, by the Appellant:
"... In those cases where soft-shell clams or oysters were delivered during the periods shown above as having QMP and sales invoices agree, then the QMP records are accepted as accurate and the insurable weeks and earning are based on the QMP records, unless proven otherwise by the fisher..."
[2393] This Appellant was not contradicted. No reference was made or question asked of him concerning the QMP scribblers of the Payor. No evidence showed that he participated in falsifying records of employment or other documents or made false statements in relation to any claim for unemployment insurance benefits.
[2394] This case illustrates once more how the Appeals Officer did not estimate the insurable earnings of this Appellant in conformity with section 80 of the Regulations as already explained earlier in this judgement.
[2395] The submissions of this Appellant (Exhibit S-25) were reviewed and adopted by this Court.
[2396] The Court is satisfied that the evidence of this Appellant has proven on a balance of probabilities that his insurable earnings for 1992 are those reported in his ROE as issued by the bookkeeper of the Payor according to the records kept under section 77 of the Regulations.
[2397] This appeal must be allowed.
42. Ivan Leard
[2398] This Appellant was heard on March 4, 1999. The Appellant, Ivan Leard, in appeal No. 97-119(UI), as to paragraph 5 of the Reply, admitted the allegations in subparagraphs a) to c), e), h) and j). The allegations in subparagraphs i) and k) were admitted with further explanations to be given at the hearing. The allegations in subparagraphs d), f), g) and l) were denied and disproven by the evidence.
[2399] Exhibits R-51, R-51-2 and R-52-1 to R-51-4 were filed in the Court record.
[2400] The record of employment of the Appellant issued by the Payor indicates six weeks of deliveries of fish. The four weeks in May and June are not under review. The two weeks of September 9 and October 9, 1993 were not allowed. Instead the Appellant was allowed four weeks of minimum earnings from September 4 to October 2, 1993 because of the credibility of the Payor's QMP records.
[2401] The Appellant used a boat to catch eels and oysters and part of the time for perch. The boat was used only to transport the quahaugs.
[2402] In 1993, he said that according to what he knows he had six DFO slips. He had only five DFO slips at the hearing. One of the six was in question because he had no record of it. The Appellant referred to his record of employment stating "that would be where my DFO slips are". The record of employment (Exhibit R-51, p. 11) indicates six insurable weeks with the Payor. The Appellant then said that he only had five DFO slips, that he could not find the other one and that apparently nobody knew where it was.
[2403] The Appellant referred to another record of employment he had with Kennie MacWilliams Seafoods Ltd. (Exhibit R-51, p. 12). He had a sale of oysters on June 12, 1993 and he did not know why there was no record for the delivery date of June 12, 1993 on the record of employment of the Payor. He did not know why it was there. He would not say that he could have delivered on the same day June 12, 1993 to the Payor and to Kenny MacWilliam Seafoods Ltd., because he had no record of it. This was not brought to his attention during the investigation (pp. 109-110 of the transcript) and he did not know when it came up.
[2404] The only records he keeps are his DFO slips and declarations and when he received his record of employment for 1993, he never noticed at the time that one DFO slip was missing. It was probably 1996 before he realized it. After three years, he figured it was too late to do anything about it but was quite sure it was on his income tax. The indication on his income tax return for 1993, indicates income from the Payor of $6,250.40 (Exhibit R-51, p. 33). He sold eels and perch.
[2405] The Appellant wanted re-instated the two insurable earnings he made on September 9 and October 9, 1993 (Exhibit R-51, pp. 20 and 22). The Minister ruled that the Appellant be given insurable earnings for four weeks between September 4 to October 2, 1993 at the minimum amount of $149.00 based on the credibility of the QMP records instead of the two weeks of September 9 and October 9, 1993 as shown on his DFO slips (Exhibit R-51, pp. 20 and 22).
[2406] The Appellant knew nothing about the QMP scribblers. He was at an interview with Lew Stevenson. He gave a statement which was read to him. When he got home he realized that the statement contained an inaccuracy. He met with Lew Stevenson a couple of days later to make a change to the statement which was refused.
[2407] The Appellant was cross-examined. He explained how he delivered the fish indicated in his DFO slip of September 9, 1993 (Exhibit R-51, p. 20). It was one delivery. He filled out a declaration at the same time. He also explained his delivery of eels represented by his DFO slip of October 9, 1993 (Exhibit R-51, p. 22). The DFO slip and the declaration for that delivery would have been made up on the same day.
[2408] The Appellant also said that the DFO slip and the record of employment were the only records he ever had for selling fish in 35 years. He never marked down the dates or places he fished because he does not do any bookkeeping and he does not do his own income tax. His T4F income from the Payor shows $6,250.40 (Exhibit R-51, p.33). The total of his five DFO slips is $4,900.40. He did not deliver fish to the Payor for anyone else and no one else delivered fish to the Payor for him.
[2409] This Appellant was very upset about the attitude of the Investigating Officer, Lew Stevenson. He could simply not accept that his two weeks of fishing be disallowed.
[2410] The evidence shows however that the income from the Payor according to his income tax return was $6,250.40. The total of his DFO slips from the Payor is $4,900.40. This could indicate that deliveries would have been made and no DFO slips were issued because they were not requested or the DFO slip was lost.
[2411] It appeared that it was the practice that once the fishermen had their required weeks of delivery they either stopped fishing or if they continued they would not request a DFO slip but would report the income from these deliveries on their income tax return.
[2412] In this case for instance the Appellant sold to another buyer Kennie MacWilliam. The total sum of the DFO slips given to the Appellant from the buyer was $4,466.55 and is the same amount as reported in his income tax return for 1993 (Exhibit R-51, p. 33 and R-51-2). The only conclusion, is that he delivered more fish to the Payor than can be accounted for in the DFO slips that were issued. The DFO slips totalled $4,900.40, the T4 income indicates $6,250.40; the difference being $1,350.00. Even if one was to add the deliveries mentioned in the QMP scribbler (Exhibit R-51, p. 23) which represent 29 pounds of eels at $1.60 a pound, for a total of $46.40 it is impossible to make up the difference. It is also impossible to even consider that this Appellant would have delivered only $46.40 worth of fish to the Payor in 1993 but the amount of $1,350.00 could be an extra delivery to the Payor for which the DFO slip was lost, but could account for the 6th week reported in the Appellant's record of employment at the maximum insurable earnings of $745.00.
[2413] Furthermore, the pay record for the Appellant in Exhibit R-51, p. 24, is not for the 1993 year but is a copy of the 1992 payroll page, which may be found in Exhibit R-20-1, p. 29. There is no other pay record of the Payor in the Exhibits for the Appellant.
[2414] As for the deduction of unemployment insurance premiums, the Payor would take it from the amount of the DFO slip and give the balance of the money to the Appellant. He paid approximately $21.00, depending on the amount of the DFO slip.
[2415] The Appeals Officer, Betty Ford, was heard in this appeal on November 30, 1999.
[2416] The Appeals Officer admitted that she did not accept the Appellant's receipts to overturn the ruling decision.
[2417] She accepted that the Appellant fished. She relied on the QMP scribblers because it was accurate. The two deliveries of the Appellant indicated on the DFO slips for September 9 and October 9, 1993 were not in the QMP scribblers.
[2418] She agreed with the Appellant when he says that he is no longer responsible for fish once it is sold to the buyer.
[2419] The Appeals Officer was asked if she ever gave anybody the benefit of the doubt. She explained that when the QMP scribblers were not accurate, the DFO slips were accepted. She also said that her superior approves every file.
[2420] The Appellant indicated to the witness a passage in her report (Exhibit R-51, p. 44) stating: "the worker appeared to be very reliable and forthright".
[2421] The officer also admitted that it would not be reasonable to believe that the Appellant would travel 20 kilometres to deliver to the Payor two pounds of eels as indicated in the QMP scribbler (Exhibit R-51, p.23).
[2422] This Appellant was truthful and was not contradicted. Nothing in the evidence could show that the Appellant gave false or misleading statements or that he participated in falsifying his record of employment or any other document in relation to any claim for unemployment insurance benefits.
[2423] In any event, the two weeks of fishing of September 9 and October 9, 1993 must be allowed in view of the accepted available evidence.
[2424] This Appellant has proven to the satisfaction of the Court on a balance of probabilities that his insurable earnings for 1993 with the Payor are those indicated on his ROE as prepared by the accountant according to the records kept by the Payor under section 77 of the Regulations.
[2425] This appeal must be allowed.
43. Ivan Baglole
[2426] This Appellant was heard on March 4, 1999. The Appellant, Ivan Baglole, in appeal No. 97-1204(UI), as to paragraph 7 of the Reply, admitted the allegations in subparagraphs a) to c), e), h), i) and k). The allegation in subparagraph j) was admitted with further explanations to be given at the hearing. The allegations in subparagraphs d), f), g) and l) were denied and disproven by the evidence.
[2427] Exhibits R-52 and R-55-1 were filed in the Court record.
[2428] The records of employment of the Appellant indicate that he had one week of fishing with the Payor and 9 weeks with Maddix Seafood Connection Ltd. in 1993 (Exhibit R-52, pp. 14 and 15).
[2429] The only insurable earnings in dispute are with the Payor for the week of September 24, 1993.
[2430] The Minister determined that the Appellant had four weeks of insurable earnings with the Payor instead of one. The decision was based on the credibility of the QMP records of the Payor and on the benefit of the doubt accorded to the Appellant (Exhibit R-52, p. 41).
[2431] The Appellant fished lobsters, flounder and eels in 1993. He used a boat in making his catches.
[2432] The Appellant pointed out that the QMP scribbler page in his exhibits' book (Exhibit R-52, p. 18) shows 3 pounds of eels on September 17, 1993. The Appellant says that he would not drive 20 to 30 miles to deliver $3.60 worth of eels. He did not know a thing about the QMP scribblers.
[2433] The Appellant turned to page 38 of Exhibit R-52. Under the heading "Department of Fisheries and Oceans delivery slips state" the price of eels and flounder should be $0.50 and not $1.00 a pound". The Appellant said that if they relied on the QMP scribbler he was credited for the week of the September 18, 1993 where the scribbler says he sold 3 pounds of eels but he was not credited for the 25 pounds of eels that show up in the same scribbler for September 29, 1993 (Exhibit R-52, pp. 18 and 38).
[2434] In cross-examination, he said he fished with his wife, Sandra Baglole. She sold no fish to the Payor in 1993.
[2435] The week he fished and sold to the Payor was September 24, 1993. He made three deliveries. He kept no record of his dates or amounts of deliveries of eels. He was shown the questionnaire he had filled out (Exhibit R-52, p. 21). He admitted having sold to the Payor in September and October of 1993. Being questioned by the Court, he said that the deliveries he made in October of 1993 were not enough for a stamp or insurable week. The Appellant said that "you could be getting on September 29 and October 2, 25 pounds of eels each day as shown in the QMP scribbler". He admitted that the 50 pounds of eels would not give him enough money to get a stamp and did not take one and did not receive a DFO slip.
[2436] He was asked if at Sharbell's he would receive a DFO slip only if he asked for it? He said that he would ask for a DFO slip when he had a high week. Since he was not getting an unemployment insurance stamp, he did not receive a DFO slip, because Dale Sharbell would have told him that it was not enough for a stamp and he did not need a DFO slip. The sale would have been for about 20 or 25 pounds and he did not have enough for an extra week. He said that at Sharbell's, persons would only get a DFO slip if they were asking for a stamp (p. 211, transcript). He said that he knew that he should have had a DFO slip even if it was a small amount (p. 214, transcript).
[2437] The Appellant was shown his statement of fishing income from the Payor for 1993 (Exhibit R-52-1). His gross earnings are $1,020.00 which is the same amount indicated on the only DFO slip he received from the Payor on September 24, 1993. So the two or three sales that the Appellant admitted making to the Payor after September 24 for small amounts, were not recorded on a DFO slip and these sales were not indicated by the Payor on the Appellant's T4 supplementary statement of fishing income. The Appellant maintained however that the Minister was incorrect.
[2438] The Appellant admitted to the Court that it would have been better if the Minister had known that he had delivered to the Payor after September 24, 1993 and had received a DFO slip for his deliveries.
[2439] The pay period, on page 19 in Exhibit R-52, is the 1992 pay record (see Exhibit R-20, p. 117). There is no pay record for the 1993 year in the Court record.
[2440] The Appeals Officer, Elizabeth White, was heard on December 2, 1999.
[2441] The Appellant was given the benefit of the doubt for the DFO slip he received from the Payor (Exhibit R-52, p.17) on September 24, 1993, but only for an amount of $675.00. He was given three extra weeks of earnings at the minimum amount of $149.00 because of the reliability on the QMP scribblers.
[2442] The Appeals Officer said she used the QMP scribblers to determine the poundage.
[2443] She repeated what she had previously stated that all she was trying to do was to determine the Appellant's' earnings.
[2444] This Appellant explained that he received a DFO slip on September 24, 1993 as he was requesting a stamp or a week of insurable earnings. He admitted having sold small amounts after September 24, for which he received no DFO slips. Whatever money he received for those small deliveries was not known and was not reflected in his T 4 income for 1993.
[2445] The DFO slip (Exhibit R-52, p. 17) of September 24, 1993, shows 75 eels at $1.60 for a total of $120.00. The QMP scribbler (Exhibit R-52, p. 18) would shows a total of 79 eels, presumably delivered on five different days with no price. The Appellant admitted that he delivered a few eels after September 24, 1993, which could account for the extra four eels in the QMP scribbler. However the QMP scribbler reflects the name of Ivan Baglow. The Appellant seems to spell his name Baglole which seems to be his name on the DFO slip (Exhibit R-52, p. 17). The QMP scribbler pages indicates no price. The lot No. 16 on the DFO does not correspond to any lot number in the QMP scribbler. The payroll book of the Payor for 1993 is not in the Appellant's exhibits book (Exhibit R-52).
[2446] We must assume that the premiums for unemployment insurance for the week reflected in the Appellant's DFO slip for September 24, 1993 were paid as the evidence did no show that any premiums were not paid by the Payor.
[2447] This Appellant was truthful and no evidence showed that he would have participated in falsifying records of employment or other documents or making false statements in any claim for unemployment insurance benefits.
[2448] The Appellant has proven to the satisfaction of the Court that his insurable earnings with the Payor for 1993 are those described in his ROE as prepared by the accountant from the records of the Payor maintained according to section 77 of the Regulations.
[2449] This appeal must be allowed.
44. Charles Wagner
[2450] This Appellant was heard on March 4, 1999. The cross-examination of the Appellant began and should have continued the following day, March 5, 1999, but the Appellant did not return to the hearing and thus the cross-examination of the Respondent was not completed.
[2451] The Appellant, in appeal No. 97-1465(UI), as to paragraph 4 of the Reply, admitted the allegations in subparagraphs a) to c), e), h), j) and k). The allegations in subparagraphs f) and g) were ignored. The allegations in subparagraphs d), i) and l) were denied and disproven by the evidence.
[2452] Exhibits R-53, R-53-1 to 53-5 were filed in the Court record.
[2453] The record of employment of the Appellant with the Payor shows eight weeks of insurable earnings (Exhibit R-53, p. 11). The Appellant had two weeks with another Payor, Indian River Oyster Farm (Exhibit R-53, p. 12).
[2454] The Minister determined that the Appellant had 12 weeks of insurable earnings based on the QMP records of the Payor.
[2455] The Appellant used a boat for his "last stamp" when he fished oysters, during the week ending on October 21, 1993.
[2456] The Appellant said he took all his bills, DFO slips, etc. to Lew Stevenson of HRDC and was told that they "weren't worth the paper they were written on" (p. 239 of the transcript of March 5, 1999).
[2457] He fished with his wife, Cathy Wagner, and they delivered their fish separately.
[2458] He filed 29 receipts from Sharbell's Irving (Exhibits R-53-1 to R-53-3) including one DFO slip No. B362133 and a receipt from Sharbell's Irving.
[2459] The Appellant would receive a slip of paper for each delivery and at the end of the week he would receive a DFO slip for the total deliveries for the week. The only week where a 25% deduction should have taken place was the week of October 21, 1993.
[2460] The Appellant, after his interview with Lew Stevenson on account of what he was told, did not bother to respond to Revenue Canada.
[2461] The Appellant stated that all his receipts corresponded to the scribbler page. He directed the Court's attention to page 27 of Exhibit R-53. He explained that his wife's name also appears in the scribbler. He said that the Minister wanted to give him all the stamps (page 28 of Exhibit R-53).
[2462] The Appellant said that he saw the scribbler, but he never kept track of it. He never saw anybody "marking" his catch in the scribbler. He said that Martin Smith would give him the slip of paper. He said that all of the catches are the same as in the scribbler. He thinks that Martin Smith made up most of the DFO slips. He said he had DFO slips for each of the eight weeks he sold to the Payor.
[2463] In his questionnaire (Exhibit R-53, p. 31) he said that he would provide a DFO slip for October 16, 1993. At the hearing the Appellant stated that there was no way he could provide a DFO slip for that date, because "I got no stamp that week, so it'd be hard to provide one" (p. 251 of the transcript of March 4, 1999). The Appellant was under the impression that it was the week of October 21, where he did fish and deliver oysters (Exhibit R-53-2).
[2464] The Appellant was cross-examined. The exhibits now show eight DFO slips (Exhibits R-53, pp. 14 to 26 and R-53-2).
[2465] The Appellant was asked why the Respondent did not have the DFO slips that he had just filed in the Court record (Exhibit R-53-2). The Appellant stated that he offered it to the investigator who would not look at it. He never spoke to anybody after that. He said that his wife would have spoken to someone from Revenue Canada over the phone.
[2466] The Appellant stated that Patricia Griffin, the Appeals Officer, never contacted him. The wife of the Appellant would have told him that somebody wanted to know if he would mail his bills to Revenue Canada. He refused to do so because they had been refused by Lew Stevenson of HRDC.
[2467] The Appellant admitted however that he mailed in a questionnaire which he filled out and signed (Exhibit R-53, pp. 30 and 31).
[2468] The Appellant received slips at the time of delivery (Exhibit R-53-1), but did not sign a Fishermen's Declaration at that time. If he was given a declaration to sign he would fill it out. He signed a declaration at the end of every week because he thought that was all that was required.
[2469] He said he saw the scribbler but did not know what was in it. He did not know they had anything to do with his deliveries of fish. He fished ten weeks because he only needed ten weeks.
[2470] He fished with his wife, Cathy Wagner. Their fish was put in separate coloured tubs or pales. He had a black pale and his wife's was white. They delivered every second day or so. He would fill mostly a tub a day.
[2471] He said that the QMP scribblers (pages 27 and 28 of Exhibit R-53), reflect accurate amounts which were delivered by him and his wife only in some cases. He also said that "every bill I got is not exactly like on the scribbler on that date". He also said that "like from October the 11th, to probably about October the 25th, we had bills and they're not on the scribbler at all". Here, he was referring to his receipts. He said that the receipts belonging to his wife were not in the scribbler. One of his receipts is dated September 28, 1993 for $154.14 (Exhibit R-53-3). On the scribbler page for September 28, 1993, there is an entry of $277.54.
[2472] This Appellant also said there are receipts in his wife's name for October 11, 1993, that are not in the QMP scribbler and the last entry is on September 6, 1993 but that his wife fished after September 6, 1993.
[2473] He and his wife fished quahaugs but did not use a boat. He fished oysters and his wife did not. He used a boat when fishing oysters.
[2474] He guessed that his wife needed 20 weeks to qualify for unemployment insurance. According to her record of employment with the Payor, she received 20 weeks. He did not know whether she was going to attend the hearing to testify.
[2475] For the oysters he fished, he made one delivery. He did not know whether he signed a declaration for the DFO slip he received on September 21, 1993 (Exhibit R-53-2). He said that copies of declarations are not given to fishermen.
[2476] He also said he fished with his brother and sister-in-law.
[2477] His wife fished in 1992 and had ten stamps.
[2478] He said that his wife wanted to testify in camera. The Court assured the Appellant that his wife could be heard in camera.
[2479] The Appellant was to return the next morning to continue the cross-examination.
[2480] The Court was under the impression that the Appellant would have been in Court with his wife, Cathy Wagner, the next day as scheduled. The case of the Appellant was called every day of sitting, but there was no response.
[2481] The total amount of the original receipts he brought to Court is $6,616.76. None of them are in his wife's name. These are the receipts he wanted to show HRDC when he was ordered to report. These were receipts for money he had received from the Payor. From the total of $6,616.76, you must deduct a total of $193.55 which was deducted by the Payor for premiums for "stamps". This leaves a total of $6,423.21.
[2482] The Payor issued to the Appellant eight DFO slips, seven of which the Respondent found (Exhibit R-53, pp. 13 to 26), but one, the Appellant brought to Court (Exhibit R-53-2). The total of these DFO slips is $6,277.50. This amount is what the bookkeeper calculated (Exhibit R-53, p. 29). Since all the DFO slips, except one, did not require a deduction of 25% all his eight insurable weeks with the Payor would be at the maximum of $745.00 as revealed in the record of employment (Exhibit R-53, p. 11). This evidence shows that the total of the DFO slips is less than the total amount of receipts by $339.26. The amount of premiums deducted from his receipts is $193.55. The amount of deductions in the Payor's records show $178.80 (Exhibit R-53, p. 29) which represents a difference of $14.75.
[2483] If one relies on the evidence of the witness and his receipts from the Payor which he kept after all these years it shows that he actually was given receipts for what he fished, he paid his premiums, he received DFO slips which are close to the amount of his receipts. He has hardly much schooling, is not an accountant and does not have anything to do with the Payor's books. The fact that his wife did not show up cannot be attributed to him and cannot have any effect on his evidence. There may be several reasons for her not appearing. The Appellant did inform the Court at one time that his wife wished to testify in camera. Was she afraid to appear? The Court does not know. Her appeal was finally dismissed on Friday, December 3, 1999.
[2484] Rosemarie Ford, one of the Appeals Officer, was asked by the Court to review the exhibits that had been filed by him. Mrs. Ford was not the Appeals Officer that made the determination in this appeal.
[2485] The Appellant, Charles Wagner, had not, for the reasons he gave in Court, sent in any of his receipts to the Respondent. She filed the summary of the work she did on this file, as requested by the Court (Exhibit R-53-4). Mrs. Ford took the record of employment of the Payor which normally matches up with the payroll records and reviewed the documentation.
[2486] She filed the result of her work (Exhibit R-53-4) on April 16, 1999. She came to the same conclusion as the Appeals Officer, Patricia Griffin, in her report dated May 8, 1997 (Exhibit R-53, p. 41) relying on the QMP scribblers.
[2487] However, the Appeals Officers in coming to this decision always had in mind that the QMP scribblers were accurate and reliable, and determined that despite the receipts provided to the Court in his name, the Appellant should be attributed one half of his wife's deliveries. This exercise demonstrated to the Court that without his wife being heard, the conclusion was that he and his wife delivered together the quantity of fish shown in the receipts. They also concluded that 23 of the 27 receipts matched the QMP entries. However, the QMP scribbler shows more entries that are not covered by receipts. Can one conclude, on that evidence, that the Appellant had more receipts or delivered on those days, and was given no receipts. From the evidence heard, it would be difficult.
[2488] This unrepresented Appellant after all the years of waiting gave a reasonable explanation of what he did and although, he did not return to Court, there did not appear to be much more he could have said as to his fishing activities.
[2489] It appeared to the Court that he was very upset with his interview with HRDC and came to Court with some apprehension.
[2490] The Respondent covered the matter at hand sufficiently and was provided ample opportunity to file his own study of the receipts at the hearing as requested by the Court.
[2491] Nothing in the evidence demonstrated that this Appellant would have participated in the falsifying of his record of employment or made any false statements to obtain unemployment insurance benefits.
[2492] The Appeals Officer did not estimate the earnings according to section 80 of the Regulations.
[2493] The Appellant has proven to the satisfaction of the Court on a balance of probabilities that he fished and that his insurable earnings are those shown in his ROE as determined by the accountant according to the records kept by the Payor under section 77 of the Regulations.
[2494] This appeal must be allowed.
45. Dale Siddall
[2495] This Appellant was heard on March 5, 1999. The Appellant, Dale Siddall, in appeal No. 96-2252(UI), as to paragraph 7 of the Reply, admitted the allegations in subparagraphs a) to c), e), h), i), k) and l). The allegation in subparagraph j) was admitted with further explanations to be given at the hearing. The allegation in subparagraph f) was ignored. The allegations in subparagraphs d), g), m) and n) were denied and disproven by the evidence.
[2496] Exhibits R-54 and R-54-1 to R-54-4 were filed in the Court record.
[2497] The Appellant delivered to the Payor in 1993 but not in 1992.
[2498] The only record of employment issued to the Appellant was in 1993 reporting one insurable week, with insurable earnings of $200.00.
[2499] The Minister determined that the Appellant had one insurable week from the Payor in 1992, with insurable earnings of $142.00. The Minister also determined that the Appellant had 2 insurable weeks from the Payor in 1993, with insurable earnings of $298.00.
[2500] The Appellant said that he never sold anything to the Payor in 1992. In 1993, he sold clams. He may have delivered fish in both years. He did deliver oysters in 1993, but they were not his. They belonged to Kevin Rafferty. He sold 200 pounds of clams in 1993, to the Payor.
[2501] When he delivered the oysters belonging to Kevin Rafferty, he would tell Dale Sharbell. He did not receive a receipt for them if they were not weighed.
[2502] He was cross-examined. He never fished in the fall season. He delivered the oysters because Kevin Rafferty had no licence to drive a vehicle.
[2503] The Appellant required ten weeks to qualify for unemployment benefits. He did very little in August and September. The only reason he fished was to build up his stamps and once his unemployment insurance benefits started he stopped fishing.
[2504] In 1992 and 1993, he fished oysters in the spring and sold to Carr's Lobster Pound.
[2505] When he delivered his clams to the Payor in 1993, he made only one delivery on either the 23rd or 24th of July. He picked up his DFO slip at the same time he delivered. The only reason he fished, was to build up his eligibility for unemployment insurance benefits.
[2506] He had no knowledge of the QMP scribbler (Exhibit R-54, p. 31). He explained how he delivered the fish of his brother-in-law, Kevin Rafferty. He did it because, he was his brother-in-law and had lost his driver's license.
[2507] The Appellant filed his 1993 T4F statement of fishing income (Exhibit R-54-1).
[2508] The DFO slip on page 30 of Exhibit R-54 is in the amount of $200.00 which is the same amount as his gross earnings with the Payor.
[2509] The Appeals Officer, Rosie Ford, was heard on December 1, 1999. She said that the Appellant had told her that he had not sold to the Payor until 1994 and was not able to supply any records. She admitted it would be hard for someone to prove he did not fish in 1992. The Appeals Officer did communicate with Kevin Rafferty. The person would have advised the Appeals Officer, that he made most of his own deliveries but that the Appellant may have taken him up a couple of times (Exhibit R-54, p. 56).
[2510] In his statement to the investigators of HRDC, the Appellant stated that he never delivered or sold oysters to the Payor in 1992 but that he may have delivered some oysters for his brother-in-law, Kevin Rafferty.
[2511] The Appeals Officer's report for 1993 (Exhibit R-54, p.62) indicates that the Appellant did sell to the Payor on one occasion in 1993.
[2512] This Appellant was not contradicted. No evidence showed that he participated in falsifying a record of employment with the Payor. There is no evidence of false statements either, made by the Appellant.
[2513] The evidence of this Appellant was accepted and he has proven on a balance of probabilities that his insurable earnings for 1993, are those shown in his ROE as prepared by the acountant according to the records kept by the Payor in accordance with section 77 of the Regulations.
[2514] He has also proven that he had no insurable earnings in 1992.
[2515] This appeal must be allowed.
46. Clarence A. Bulger
[2516] This Appellant was heard on March 5, 1999. The Appellant, Clarence A. Bulger, in appeal No. 97-191(UI), as to paragraph 6 of the Reply, admitted the allegations in subparagraphs a) to c), e), h), j) and k). The allegation in subparagraph f) was ignored. The allegations in subparagraphs d), g), i) and l) were denied and disproven by the evidence.
[2517] Exhibits R-55, R-55-1 to R-55-3 were filed in the Court record.
[2518] The record of employment of the Appellant with the Payor for 1993 shows three deliveries of fish (Exhibit R-55, p. 12). The Appellant had seven other weeks of fishing with another Payor, Kennie MacWilliam Seafoods Ltd.
[2519] The Minister determined that the Appellant had five weeks of insurable earnings from August 14 to September 11, 1993, in the amount of $1,231.00.
[2520] The Appellant attended an interview in Summerside on February 2, 1995, with Lew Stevenson of HRDC. Also present at the meeting were Gary Robbins and Roweena MacKinnon of Revenue Canada. The witness filed the Notice of Report which he received prior to his interview (Exhibit R-55-1). The Appellant also filed clippings from the Journal-Pioneer of August 9 and 24, 1993, which contains "Fish Price Report".
[2521] The Appellant used a boat to transport his clams and not to dig them. The receipts and DFO slips, he was able to provide are in Exhibit R-55, pp. 25 to 36. The Appellant was paid $1.40 per pound for the clams he delivered to the Payor during that two-week period. He would get his DFO slip at the end of the week. He was paid the price of fish indicated on the DFO slip. He had three declarations for the three deliveries he made to the Payor in 1993 (Exhibit R-55, pp. 14, 16 and 18).
[2522] In answer to the Minister, the Appellant said that during the weeks ending August 28 and September 11, he was picking quahaugs in Charlottetown and sold them to another buyer Kennie MacWilliam. The Appellant says that he could not have had insurable weeks with the Payor on August 28 and September 11, because he was delivering to Kennie MacWilliam (Exhibit R-55, p. 13).
[2523] The Appellant pointed out the discrepancies in the Quality Management Program (QMP) scribbler (Exhibit R-55, p. 49).
[2524] The Appellant was also cross-examined on his relationship with other persons by the family name of Bulger.
[2525] The Appellant said that there were a number of deliveries. If he dug clams every day, he would deliver them to the Payor every day. He would take them to the Payor, have them weighed, obtain a receipt. He received the DFO slip the day which appears on it. He was paid for his clams the day he delivered them.
[2526] In examining page 20 of the QMP scribbler (Exhibit R-55) with some of the receipts provided by the Appellant, some but not all of the quantities of fish delivered, match the entries in the QMP scribbler (Exhibit R-55, pp. 25 to 36). The Appellant said he kept records of the dates of his deliveries with the Payor but cannot find his calendar. In 1993, he did not deliver for anyone else and no one delivered for him. His DFO slips were issued to him by Martin Smith and/or Dale Sharbell. Martin Smith never paid the Appellant. It was always Dale Sharbell. The Appellant did admit that the amounts on a receipt were not what he actually got paid. He could not say if the DFO slip would be correct. All the receipts of the Appellant were not before the Court.
[2527] The Appeals Officer, Elizabeth White, was heard as a witness on December 2, 1999. The Appellant wanted to know why she did not accept his receipts as other officers did. She replied that she had examined all the receipts that he provided. It was agreed that he did not provide all his receipts since he did not have them all.
[2528] It appeared that the Appellant had one receipt for August 28 but had no corresponding receipts for the September 4, 1993 delivery. The Appellant showed a series of receipts dated from August 14 to 21, 1993. These receipts were not used by the Appeals Officer to determine the Appellant's earnings. She said that if the name of the Appellant had not been in the QMP scribbler, his receipts would have been relied upon by her to allow him a minimum insurable week. She said that since the master file had stated that for those weeks the QMP scribbler was reliable she followed the QMP recordings as reliable. She was asked where the price came from since no price was written on the QMP page (Exhibit R-55, p.20). She replied that there was a set price in the master file which was used.
[2529] The Appellant asked why he was deducted 25% for the use of a boat. She replied that if a boat was used in making a delivery she took off 25%.
[2530] The Appeals Officer when re-examined showed that four receipts (Exhibit R-55, pp. 30 to 33) show the same dates and quantities as reflected on the page of the QMP scribbler which contains a listing of 12 entries (Exhibit R-55, p. 20).
[2531] She said that the Appellant was one of the few that provided receipts from their fishing.
[2532] She explained what she was doing when we look at pages 48 and 49 of Exhibit R-55. She replied that there were a few typing errors by that the summary of her report showed the correct amounts for her decision (Exhibit R-55, p. 51).
[2533] This Appellant was not contradicted. He was not the bookkeeper. No evidence established that he did not deliver what he delivered according to the best evidence available.
[2534] The evidence did show in this case that the receipts and DFO's provided to the Appellant by the Payor do not reflect what was actually written in the QMP scribbler. The QMP reflects 1,385 pounds of clams. The DFO slips, alone, reflect 1,818 pounds. It would appear that the buyer did not record all the quantities that were actually delivered.
[2535] The buyer did not deduct the 25% since, according to the evidence, the Appellant did not use the boat to make his catch but for transportation purposes. The pay records of the Payor are made up according to the DFO slips on file.
[2536] No evidence showed that this Appellant participated in any way in falsifying records of employment of made any false statements in any claim for unemployment insurance purposes.
[2537] The accepted evidence shows on a balance of probabilities that the insurable earnings of this Appellant are those recorded in the ROE for 1993 issued by the accountant of the Payor, according to the records kept under section 77 of the Regulations.
[2538] This appeal must be allowed.
47. Judy Walfield
[2539] This witness was heard on March 5, 1999. The Appellant, Judy Walfield, in appeal No. 97-2065(UI), as to paragraph 4 of the Reply, admitted the allegations in subparagraphs a) to c), e) and h) to k). The allegations in subparagraphs f) and g) were ignored. The allegations in subparagraphs d) and l) were denied and disproven by the evidence.
[2540] Exhibits R-56 and R-56-1 and R-56-2 were filed in the Court record.
[2541] The record of employment of the Appellant with the Payor for 1993, shows six weeks of insurable earnings from August 26 to October 2, 1993.
[2542] The Minister determined that the Appellant had one week of insurable earnings in the amount of $180.00 because of the reliability of the QMP records of the Payor.
[2543] The Appellant at first indicated that the DFO slip (Exhibit R-56, p.23) should be for 1,500 quahaugs.
[2544] The Appellant did not use a boat. She made six deliveries an received a DFO slip for each delivery (Exhibits R-56, pp. 14 to 23 and R-56-1).
[2545] The Appellant said that the week of August 21, 1993, which was allocated to her by the Minister, does not belong to her, because she made no deliveries to the Payor until the week of the August 26, 1993.
[2546] She attended in Summerside at the office of Lew Stevenson and he did not want to listen to what she had to say. She said that he wrote down what he wanted the statement to reflect. The Appellant refused to sign her statement as certain allegations were incorrect. The Appellant had never been interviewed before in an inquiry of this nature.
[2547] The Appellant was cross-examined. She brought to the Court the DFO slips she had in her possession and her income tax documentation. She filed a DFO slip for October 2, 1993 (Exhibit R-56-1) which was not in the possession of the Respondent. The Appellant said that when she received her notice to report to HRDC, she was asked to bring all documentation she had for her 1993 income tax returns. She had her DFO slips in particular. She attended the interview and no one asked her to see any of her documentation.
[2548] In 1993, she delivered quahaugs and one delivery of clams. She made one delivery at a time. She delivered her fish, received a slip of paper, attended the store where she received her DFO slip, her money and signed her declaration. The DFO slips were made out by Dale Sharbell or Martin Smith.
[2549] In 1993, she also worked at P.E.I. Shellfish Association in the office from August 23 to October 29 (Exhibit R-56, p. 13). She explained that she fished on the same days that she worked as an office worker. There were days she could leave at two o'clock in the afternoon and other days she finished at four o'clock. She fished afternoons and evenings. She fished during the week but she also fished on weekends. She found it difficult to fish clams and that was the reason she went back to fishing quahaugs.
[2550] She did not make a record of her days of fishing or the dates she delivered her fish to the Payor. She did not deliver for anyone and no one delivered for her.
[2551] On December 2, 1999, the Court was advised that this Appellant had no questions to ask the Appeals Officer, Elizabeth Whyte.
[2552] The Appeals Officer's report dated August 29, 1997 (Exhibit R-56, p. 34) describes how her determination was made.
[2553] This Appellant was not contradicted and the investigator, should have asked to see the documentation, since this was the purpose of reporting to him. No evidence has demonstrated that this Appellant would have participated in the falsification of her records of employment or made any false statements in her applications for unemployment insurance benefits.
[2554] The Appellant has proven to the satisfaction of the Court that on a balance of probabilities her insurable earnings for 1993 are those shown in her ROE issued by the accountant of the Payor according to the records kept under section 77 of the Regulations.
[2555] This appeal must be allowed.
48. James MacDonald.
[2556] This Appellant was heard on March 5, 1999. The Appellant, James MacDonald, in appeal No. 97-212(UI), as to paragraph 5 of the Reply, admitted the allegations in subparagraphs a) to c), e), h) and j). The allegations in subparagraphs d), f), g), i) and k) were denied and disproven by the evidence.
[2557] Exhibits R-57 and R-57-1 and R-57-2 were filed in the Court record.
[2558] The records of employment for this Appellant indicate that in 1993, he delivered to the Payor for two insurable weeks and to another payor, Burleigh Brothers for eight insurable weeks (Exhibit R-57, p. 11 and 12).
[2559] The Minister determined that the Appellant had no insurable earnings with the Payor in 1993 because of the reliability of the QMP records of the Payor and that the name of the Appellant did not appear in the QMP scribblers.
[2560] The Appellant fished oysters and quahaugs in 1993. He was issued two DFO slips for his deliveries of October 15th and 22nd of 1993 (Exhibit R-57, p. 13).
[2561] He knew nothing about the QMP scribbler. He attended a meeting with Joe Pierce of HRDC. Also present were two persons of Revenue Canada. The Appellant had with him his DFO slips for 1993 and they were photocopied by Mr. Pierce. The Appellant has been fishing for eleven years. He stated that the statement he gave to the investigators did not contain everything he said.
[2562] In cross-examination, he explained that he was asked by the investigator why his two DFO slips were numbered consecutively. He told the investigator that he did not understand it.
[2563] When he made his two deliveries to the Payor, he delivered on one occasion each week. It was pointed out to the Appellant that his two DFO slips were consecutively numbered. His answer was that he had told Mr. Pierce of HRDC that he did not know how many DFO books the Payor would have in use at the same time. He could not explain why the numbers were consecutive.
[2564] He could not say why he stopped fishing but it could have been near the end of the season when the weather would be getting a "lot cooler".
[2565] The Appellant used a boat to fish the oysters and the quahaugs. It appeared that no 25% was deducted from the DFO slips of October 15, although a boat was used for that delivery. He did not check his DFO slips to see if they were correct. He paid the premiums at each delivery and was paid on receipt of the DFO slip. The DFO slips are the only documents he has to confirm his catches. He did not know what Dale Sharbell's handwriting looked like.
[2566] The Appeals Officer's report, dated November 18, 1996 (Exhibit R-57, p. 22) states that there was no evidence to determine the Appellant's earnings. The decision was actually based on the reliability of the QMP scribbler and the Appellant's DFO slips were set aside.
[2567] The Appellant had no question to put to the Appeals Officer, Patricia Griffin, when she testified in several other appeals on November 30, 1999.
[2568] This Appellant was not contradicted. The fact that his name was not in the QMP scribbler of the Payor has no real meaning in this case. The evidence established that DFO slips were issued. Nothing in the evidence indicated that this Appellant would have given a false or misleading statement or submitted a record of employment that he knew was falsified. No evidence has impeached the credibility of this witness.
[2569] The evidence has established to the satisfaction of the Court on a balance of probabilities that the insurable earnings of the Appellant for 1993 are those contained in his ROE issued by the accountant of the Payor according to the records kept as required under section 77 of the Regulations.
[2570] This appeal must be allowed.
49. Lowell Hudson
[2571] This Appellant was heard on March 5, 1999. The Appellant, Lowell Hudson, in appeal No. 97-213(UI), as to paragraph 6 of the Reply, admitted the allegations in subparagraphs a) to c), e), h) to j) and l). The allegations in subparagraphs d), f), g), k) and m) were denied and disproven by the evidence.
[2572] Exhibits R-58, R-58-1 to R-58-10 were filed in the Court record.
[2573] The period under review in this appeal is situated in 1993.
[2574] The record of employment of the Appellant with the Payor for 1993 indicates 10 weeks of insurable earnings at the maximum of $745.00 weekly.
[2575] The Minister concluded that the Appellant had 15 weeks of insurable earnings from May 8 to October 30, 1993 as outlined in the Appeals Officer's report (Exhibit R-58, p. 72).
[2576] The Appellant stated that the only date he agrees with in the report is September 3, 1993. He filed a DFO slip and a declaration for that date (Exhibit R-58-1).
[2577] The Appellant said that there are four DFO slips for eels: May 22, June 26, June 29 and July 3, 1993. He fished eels in Cascumpec Bay mostly and delivered once a week. He explained how the QMP scribbler of the Payor (Exhibit R-58, p. 44) was incorrect. He said that the deliveries under his name from May 7 to May 16 were incorrect because it is impossible for him to "flambeau eels" in early May because the eels are still in the mud. This was even more evident in 1993 because it was a late spring with the presence of slush and ice cakes and dirty water. Since he is not a mud fisherman he did not fish at that time. He delivered eels in May but only later.
[2578] He also indicated that the reference to Gisbon Creek in the QMP scribbler on May 14, is not correct. He never heard of the place and adds, "that there is no such place on my maps". He made one trip a week and no more. In the QMP scribbler, it looks as if he would have made several trips weekly. He did not do that, the scribbler is not accurate.
[2579] He also delivered oysters and clams. He had one DFO slip for clams on September 3, 1993 (Exhibit R-58-1). He also has five DFO slips for oysters, September 24 (Exhibit R-58-5), October 9, 1993 (Exhibit R-58, p. 30), October 15, 23 and 28, 1993 (Exhibits R-58-6 to R-58-8).
[2580] He also said that the page of the QMP scribbler (Exhibit R-58, p. 43) is wrong since he never fished in Enmore.
[2581] He explained how and where he fished his oysters. He landed his fish in Alberton and not in Cascumpec as is indicated in the QMP scribbler (Exhibit R-58, p. 42).
[2582] He always counted his money before he left the Payor's store and knew that his DFO slips were accurate.
[2583] He filed a letter signed by Dale Sharbell dated May 27, 1996 (Exhibit R-58-3). In this letter, Dale Sharbell states that the DFO slips for 1992 and 1993 for the Appellant are accurate, true and correct and that any other papers containing the name of the Appellant with different amounts of fish, different values or different dates are not the true earnings and are incorrect.
[2584] The Appellant explained the circumstances surrounding his interview with Lew Stevenson of HRDC on March 14, 1995 (pp. .188-191 of the transcript of March 5, 1999).
[2585] The Appellant knew nothing about the QMP scribblers.
[2586] The Appellant was cross-examined and filed certain DFO slips (Exhibits R-58-5 to R-58-8). He received ten weeks of insurable earnings at the maximum amount for 1993. He required ten weeks to qualify for unemployment insurance benefits. He was questioned as to his deliveries of oysters and clams. He was questioned as to his fishing of eels. He did not record the dates he went fishing but he recorded the number of fish he put under the wharf. He always kept a little notebook. He would put about 140 pounds of eels per crate.
[2587] The only records he has are his DFO slips, declarations and record of employment. He stated for "decades and decades the DFO slip was a legal piece of paper. It was all we needed. No one even asked for anything else" (p. 206 of the transcript of March 5, 1999). He never delivered for someone else and no one delivered fish for him.
[2588] The Appeals Officer, Lynn Loftus, was heard on November 29 and December 1, 1999. She said that the names of fishermen were not indicated on the shipping records of the Payor. She said that the shipping records of the Payor were done on a daily basis. The shipping records cannot determine what each fisherman fished. She said that the store sales of the Payor should be shown on the Payor's sales invoices. She admitted that she did not know where Gibson Creek was.
[2589] The Appellant was not contradicted and gave a truthful and acceptable account of his fishing. The insurable earnings should remain as reflected in the record of employment.
[2590] The DFO slips for 1992 of the Payor were accepted. It is difficult to conclude how the DFO slips for 1993 with the same Payor could not be accepted especially when the Appellant had nothing to do with the bookkeeping of the Payor and had no part in the QMP scribblers. Moreover, no evidence showed that he would have participated in the falsification of his records of employment or made a false statement in applying for unemployment insurance benefits.
[2591] His income reported on the T4 slip for 1993 (Exhibit R-58, p. 57), of $9,871.65 was the same as that recorded on his DFO slips.
[2592] The Appellant has proven to the satisfaction of the Court on the balance of probabilities that his insurable earnings for 1993 the year under review are those established in his ROE by the accountant of the Payor according to the records kept under section 77 of the Regulations.
[2593] This appeal must be allowed.
50. Angus A. McKay
[2594] This Appellant was heard on March 5, 1999. The Appellant, Angus A. McKay, in appeal No. 97-331(UI), as to paragraph 5 of the Reply, admitted the allegations in subparagraphs a) to c), e) and h) to k). The allegations in subparagraphs f) and g) were ignored. The allegations in subparagraphs d) and l) were denied and disproven by the evidence.
[2595] Exhibits R-59, R-59-1 and R-59-3 were filed in the Court record.
[2596] The records of employment of the Appellant indicate that for the year 1992 he had ten weeks of insurable earnings. He had five weeks with the Payor.
[2597] The Minister allocated only two weeks of earnings for the Appellant with the Payor. The determination was based on the credibility of the QMP records of the Payor.
[2598] The Appellant fished oysters in 1992, from September 13 to October 31 and received a record of employment from the Payor for five weeks with insurable earnings of $2,243.00.
[2599] The only records the Appellant was aware of were the DFO slips. He knew nothing about the QMP scribblers.
[2600] He delivered once a week and at the end of the week he received a DFO slip for his fish deliveries.
[2601] The Appellant also worked as a labourer for Western Development Commission. He also delivered oysters to another Payor, Garry Wilson.
[2602] The Appellant filed gas receipts (Exhibit R-59-1) to indicate that he would have worked in order to buy gas for his vehicle.
[2603] The Appellant explained, at some length, how the QMP scribblers were not accurate (pp. 218-221 of the transcript of March 5, 1999). He filed his T4F income statement (Exhibit R-59-2) showing insurable earnings of $2,243.00.
[2604] The Appellant was cross-examined.
[2605] He used a boat when he fished his oysters. He explained what he did while working for the Western Development Commission (pp. 230-231 of the transcript of March 5, 1999).
[2606] He was asked to explain what he delivered to Garry Wilson, another fish buyer. He said he fished oysters and quahaugs.
[2607] He brought his fish to the Payor and received his DFO slip the same day. He did not know Dale Sharbell's handwriting but Dale Sharbell was the person who handed the Appellant his DFO slips and gave him his money for the fish.
[2608] The Appellant did not deliver fish to the Payor for somebody else. No one delivered for the Appellant.
[2609] The area where the fish was landed was not specified on the DFO slips of the Appellant. He explained that he did not tell the Payor where he was fishing that year because "I didn't want no company for the next day I went fishing" (p. 243 of the transcript of March 5, 1999). When he went to the Payor for his delivery he would give his name, his social insurance number and probably his address. The Appellant made no deliveries to the Payor for which he would not have received a DFO slip. The Appellant made sure he received the records he needed.
[2610] The Appeals Officer, Rosemarie Ford, was heard on November 30, 1999. She said that she did not do her own analysis of the reliability of the QMP scribblers. She said that she looked at the QMP scribblers (Exhibit R-59, pp. 19 to 22), the rulings information and anything that the Appellant had provided. She said she photocopied every document that had the Appellant's name on it.
[2611] She based her decision on the credibility of the records for 1992. The Appeals Officer believed the Appellant fished but because the Respondent had already decided that the QMP scribbler for oysters agreed with the sales invoices of the Payor from July 18 to October 31, 1992 she accorded two weeks at the minimum of $142.00 each.
[2612] It is necessary to note in this appeal what is outlined in the Respondent's report in relation to the 1992 QMP scribblers (Exhibit R-64, tab. 11). It reads as follows:
"In order to determine insurable weeks and earnings of each fisher, it was necessary to determine which set of records could be considered credible. In the 1992 year, the payor had just begun recording deliveries in the QMP scribblers. The payor was going through some "growing pains" and had to have records checked by DFO officials on a frequent and regular basis in 1992. Only soft-shell clams and oysters were found to have agreement between the amounts recorded as delivered to the payor (QMP scribblers) to the sales invoices, and then, only for part of the year. In those cases where soft-shell clams or oysters were delivered during the periods shown above as having QMP and sales invoices agree, then the QMP records are accepted as accurate and the insurable weeks and earning are based on the QMP records, unless proven otherwise by the fisher. The fishers were given benefit of doubt and the amounts shown on the original ROE stand during those periods where the QMP records and sales invoices did not agree; and there was nothing to refute the DFO records or confirm the QMP records (see chart for periods)."
[2613] The Respondent did not estimate the earnings of the Appellant under section 80 of the Regulations but rather decided which records were more credible.
[2614] This report shows that the Appellant had to prove the QMP scribbler wrong. The Appellant stated to the Appeals Officer that "we needed something to show that is what the DFO is for". The Appeals Officer believed he had fished but did not credit him with the amounts in his DFO slips.
[2615] This Appellant was not contradicted. His evidence was truthful and honest. Nothing in his evidence showed that this person would have been a party to the falsification of a DFO slip or a record of employment or made any false statements. This person who could not read or write too well, relied on the documents he was given for his sales. The bookkeeping was the responsibility of the Payor. The Appellant has demonstrated that the QMP records are not reliable pay records that should be used to determine his insurable earnings.
[2616] This Appellant has established by a preponderance of evidence that his insurable earnings on those described in his record of employment for 1992 as issued by the bookkeeper according to the records kept under section 77 of the Regulations.
[2617] This appeal must be allowed.
51. Roger Palmer
[2618] This Appellant was heard on March 9, 1999. The Appellant, in appeal No. 97-993(UI), as to paragraph 5 of the Reply, admitted the allegations in subparagraphs a) to c), e) and h) to k). The allegation in subparagraph f) was ignored. The allegations in subparagraphs d), g) and l) were denied and disproven by the evidence.
[2619] Exhibits R-60 and R-60-1 to R-60-4 were filed in the Court record.
[2620] The Appellant was a self-employed fisherman during 1993, involved in the fishing of quahaugs, oysters and eels. He used a boat in making his catch of eels. He delivered eels to the Payor from May 17 to May 29 for two insurable weeks (Exhibit R-60, p.13) with insurable earnings of $869.00.
[2621] The Minister determined that the Appellant had $501.95 in insurable earnings for two insurable weeks.
[2622] The Appellant filed DFO slips and gas receipts (Exhibit R-60-1), his 1993 statement of fishing income from the Payor (Exhibit R-60-2) and a statement from Polar Fisheries Ltd. (Exhibit R-60-3).
[2623] The Appellant is the President of Conway Fish Market. His company bought eels in 1993 and did not sell any eels to Polar Fisheries Ltd. between May 6 and May 27, 1993 (Exhibit R-60-3).
[2624] The Appellant received a record of employment from the Payor with one week of insurable earnings (Exhibit R-60, p. 12) on July 14, 1993 and with one delivery dated May 21, 1993 with earnings of $628.00. He was subsequently given a second record of employment from the Payor on July 22, 1993 with two weeks of insurable earnings of $869.00 for the weeks ending May 21 and May 29, 1993.
[2625] The Minister in his determination allowed a minimum insurable week of $149.00 for the week ending May 21, 1993. The Minister also allowed for the week ending May 29, 1993, insurable earnings in the amount of $352.95 (Exhibit R-60, pp. 53 to 56).
[2626] The Appellant's DFO slips for the Payor, which he filed, were as follows: May 17, 1993 for $593.60, May 20, 1993 for $94.40, May 21, 1993 for $148.80, May 23, 1993 for $188.80, May 29, 1993 for $281.40. These five deliveries were for catches of eels.
[2627] When cross-examined, certain differences were pointed out to the witness between those DFO slips he filed at the hearing (Exhibit R-60-1) and those reproduced in the book of the Respondent (Exhibit R-60, pp. 23 to 28).
[2628] The Appellant admitted that the week of May 29, 1993 with earnings in the amount of $352.95 was not disputed by him. He was disputing the week of May 22, 1993. When calculating the week of May 22, the total of the DFO slips he filed is $836.80. Since the Appellant used a boat, 25% would be deducted ($209.20), which would indicate insurable earnings of $627.60. The Appellant agreed to this amount. This would be approximately the earnings ($628.00) described in the first record of employment given to him by the Payor (Exhibit R-60, p. 12).
[2629] What the Appellant could not explain was why the Payor, when issuing the second record of employment to him in 1993 (Exhibit R-60, p.13) indicated insurable earnings of $516.00 for the week ending May 21, 1993 instead of the $628.00 that his DFO slips indicate. One answer could be provided by analyzing the documents provided by the accountant of the Payor in Exhibit R-60, p. 31. In this document the accountant indicates next to the DFO slip for May 21, 1993, bearing number W438379, the words "not correct person".
[2630] As a result the accountant appears to have subtracted the amount of that DFO slip ($148.80) from that insurable week, leaving a total of $688.00 for the week ending on May 21, 1993. From this total of $688.00 the accountant then in the normal course of his duties deducted the 25% for the use of a boat ($172.00) which then agrees with the insurable week of $516.00 which is found in the second record of employment of the Payor, which was issued on July 22, 1993 (Exhibit R-60, p. 13). As a result the accountant also issued to the Appellant his statement of income or T4F supplementary with gross earnings of $1,058.20 and insurable earnings of $868.65 (Exhibit R-60-2).
[2631] However a question remains. Who indicated to the accountant to inscribe next to the DFO slip No. W438379 the words "not correct person" which would have resulted in the correction to the pay records?
[2632] The evidence of the Appellant did not mention that. The Appellant presented the DFO slips for all his deliveries including No. W438379, in Exhibit R-60-1. This DFO slip No. W438379 in the possession of the Appellant when he testified on March 9, 1999, is made out in his name and one must assume that he has had it for the last six years. It would be very unlikely that it would have been made out to an incorrect person under such circumstances. Why would it be in the possession of the Appellant in 1999, if it did not belong to him? The Appellant did not claim it was made out to an incorrect person. It was made out to Roger Palmer, social insurance number No. 111-465-779 and was adopted by the Appellant as his.
[2633] Another discrepancy was indicated on the DFO slip No. W438361. This document is reproduced on pages 27 and 28 of Exhibit R-60. This DFO slip was also filed by the Appellant for May 17, 1993 (Exhibit R-60-1). The Appellant admitted that when he received his copy it was as it may be seen on page 28 of Exhibit R-60, but without the date. The Appellant would have added the date of May 17, 1993 because he thought that was the date he delivered his fish.
[2634] The Appellant also said that the DFO slips were made out in his presence when he delivered his fish. However, the copy of the same DFO slip No: W438361 is dated May 19, 1993 and has at the bottom the word "stamp". This would mean, according to the evidence, that the fisherman wanted that DFO slip to count as insurable earnings. Why was that not indicated on the Appellant's copy of the DFO slip (Exhibit R-60-1)?
[2635] When analyzing this evidence together with the Appellant's statement which was not denied, one must conclude that the Appellant delivered fish as specified in his DFO slips, but that the Payor's copy of DFO slip No. W438361 would have been dated and the word "stamp" added to it after the Appellant received his copy which had no date and no indication "stamp" on it. When would the buyer have dated and added the word "stamp" on DFO slip No. W438361? The records of the buyer indicate May 19, 1993 (Exhibit R-60, p. 31). These records also indicate that the DFO slip No. W438379 is not for the correct person and no money appear to have been paid to the Appellant (Exhibit R-60, p. 31).
[2636] These pay records of the Payor show gross earnings of $1,158.00, which is the total of DFO slips No. W438361, ($593.60), W438374, ($94.40), W438243, ($281.40) and W438388, ($188.80). The same records show $868.65 of insurable earnings and $26.06 of unemployment insurance premiums which, according to the evidence was paid by the Payor. This would indicate that the Appellant paid no premiums for the DFO slip No. W438379 dated May 21, 1993. The figures above are also in accord with the statement of fishing income provided to the Court by the Appellant (Exhibit R-60-2).
[2637] The Appeals Officer, Lynn Loftus, was heard on December 3, 1999. She repeated as she had on many occasions that her decision was based on the credibility of the QMP scribbler. She explained why she had awarded the weeks of insurable earnings of May 22, 1993 ($149.00) and May 29, 1993 ($352.95).
[2638] In her report (Exhibit R-60, p. 10), she states "the worker will be allowed an insurable week for the week ending May 22, 1993 as the worker states he fished and there is no evidence to prove he did not fish. However, we are unable to accurately calculate the insurable earnings as the figures cannot be proven. Therefore, the worker will be allowed a minimum insurable week at $149.00 for week ending May 22, 1993. For the week ending May 20, 1993, the confusion is as a result of a date being miss recorded either on the DFO slip or the QMP records as the amount of fish sold agrees".
[2639] Looking at the page of the QMP scribbler (Exhibit R-60, p. 30), it indicates under the name Roger Palmer for June 3, 1993, "319 pounds weight from Beaton's". The Appeals Officer explained that Beaton's was another buyer and that this delivery could belong to the Appellant or to the other buyer by the name of Beaton. This admission does not help the Court to determine who delivered that catch. It appears that what she concluded was that since the total delivery in the QMP scribbler on June 3, 1993 (Exhibit R-60, p. 30) was 319 pounds and the total of the two DFO slips of May 23 (Exhibit R-60, p. 24), 118 pounds and May 29, 1993 (Exhibit R-60, p. 23), 210 pounds also equalled 319 pounds, it had to belong to the Appellant. However at the hearing she admitted that this delivery could also belong to another buyer by the name of Beaton whose name appears in the QMP scribbler for the only delivery of fish on June 3, 1993.
[2640] This evidence would lead to confirm that the QMP scribbler would not be reliable to determine who made the delivery or to whom the catch belonged. The evidence of the Appellant which was not contradicted and whose credibility was not impeached demonstrates that it was not him. Furthermore, the Respondent's inquiry did not reveal whether information was gathered from Beaton to establish how much he would have sold to the Payor.
[2641] Lynn Loftus also said that, in coming to her decision in this case, she relied on her own analysis. She carried out the volume analysis of the Payor's purchases and sales and determined when the Payor's QMP scribblers should be relied upon.
[2642] Her decision with the approval of the Chief of Appeals was adopted by the other Appeals Officer who worked on all these appeals. She admitted that she did not rely on the figures arrived at by the Rulings Officer (Exhibit R-64, tab. 8, p. 6).
[2643] She also said that she did no volume analysis for 1992.
[2644] She did not show what was accurate. She had a lot of figures that were not the same. If there had been a discrepancy between her figures and those of Gary Robbins she would have checked with him.
[2645] This Appellant has established by a preponderance of evidence that his insurable earnings are those described in his record of employment for the year 1993 issued by the accountant according to the records kept under section 77 of the Regulations (Exhibit R-60, p. 13).
[2646] Therefore, in this appeal, the only reliable information is that of the accountant as indicated on the Appellant's record of employment (Exhibit R-60, p. 13). No evidence showed that the Appellant would have participated in falsifying his record of employment or made false statements in relation to any claim for unemployment insurance benefits.
[2647] This appeal must be allowed.
52. John Rayner
[2648] This Appellant was heard on March 9, 1999. He was represented by Darryl MacIntyre for the cross-examination of the Appeals Officer, Elizabeth Whyte on December 2, 1999. The Appellant, John Rayner, in appeal No. 97-520(UI), as to paragraph 7 of the Reply, admitted the allegations in subparagraphs a) to c), i), k) and l). The allegations in subparagraphs e) and j) were admitted with explanations to be given at the hearing. The allegation in subparagraph f) was ignored. The allegations in subparagraphs d), g), h) and m) were denied and disproven by the evidence.
[2649] Exhibits R-61, R-61-1 and R-61-2 were filed in the Court record.
[2650] The Payor did not issue a record of employment to the Appellant for 1993. The Appellant delivered eels to the Payor however, on July 1, 1993, valued at $383.75. He was not given a statement of earnings (T4F supplementary) from the Payor. He received a DFO slip (Exhibit R-61, p. 12). The reason for not having any insurable earnings with the Payor was that the Appellant did not require a "stamp" or a week of insurable earnings for the year of 1993. The real reason for selling these eels was that the Appellant heard that if he never sold any eels, he would not be eligible for a licence for fishing eels which he thought might come into effect. In 1993, the Appellant knew that he was going to fish lobsters. He sold the one catch of eels, to prove that he had fished that year.
[2651] The Minister determined that the Appellant had seven weeks of insurable earnings for a total of $1,447.00. This decision was arrived at as a result of the QMP records of the Payor which, according to the Minister were reliable (Exhibit R-61, p. 32).
[2652] The Appellant reported to HRDC and discussed the 1992 period of fishing. He advised the investigators, Charlene Kelly and Joe Pierce that he had sold $383.00 worth of eels to the Payor, which he reported on his income tax return for 1993 (Exhibit R-61, p. 19, line 170). The Appellant said that there were four John Rayners, one in Devon, one in Oleary, one in Cascumpec and one in Enmore. He did not know whether they were fishermen.
[2653] The Appellant directed the attention of the Court to Exhibit R-61, p. 13 which is a page from the QMP records of the Payor for oysters, from July 19 to October 11, 1993. The Appellant said that the season for oysters was closed from July 16 to August 1, 1993. You could not fish oysters off a lease nor a public area. From May 15 to July 15 was the season to fish contaminated oysters. He also said that this page (Exhibit R-61, p. 13) could not be for oysters as they are bought in pecks. In his view this page should be quahaugs.
[2654] The Appellant also said in reference to page 29 of Exhibit R-61, that from August 11 to 13 and on September 1, 1993, he was fishing lobsters. He fished lobsters "pretty well every day". The days were written in the log of his employer, Barry Tuplin. When the Appellant went lobster fishing, he left early in the morning and when he returned, it was mostly after dark.
[2655] The Appellant was cross-examined. He confirmed his sale of eels to the Payor. He explained that when he sold the fish he indicated to Martin Smith that he did not want a stamp. The Appellant said that he knew he would be receiving the ten stamps necessary for unemployment benefits with his lobster's fishing with Barry Tuplin. He kept no personal record of his fishing. He had his DFO slip for what he sold to the Payor and the log of Barry Tuplin. He used a boat to fish the eels. His wife, Bernice, fished quahaugs, oysters and eels in 1993. The Appellant did not deliver any fish for his wife to the Payor. She did not deliver anything to the Payor for him. No one delivered fish for him to the Payor in 1993. He was paid cash by Martin Smith. He asked Dale Sharbell for a T4 slip and he said that the DFO slip would do.
[2656] The Appeals Officer, Elizabeth Whyte, was heard on December 2, 1999. The Appellant was represented for this day by Darryl MacIntyre, another Appellant.
[2657] The Respondent advised the Court that the weeks ending on July 24 and 31, and August 14 and September 4, 1993 should not have been allocated to the Appellant since page 13 in Exhibit R-61 does not correspond to oysters but to quahaugs. The explanation given was that the Appeals Officer, when making her determination, did not have in her possession the original QMP scribbler, but a photocopy of a page which is reproduced in the Appellant's book of (Exhibits R-61 at page 13). This situation prompted a question from the Appellant's representative "if those oysters are taken away from John Rayner they must belong to someone else".
[2658] The fact remains however, that John Rayner was correct in his evidence on March 9, 1999, when he maintained that the QMP scribbler as reproduced in his Exhibit book was wrong. It must also be noted that three of the weeks that were taken away by the Respondent at the hearing on December 2, 1999, had also been allocated by the Rulings Officer, Mr. Gary Robbins (Exhibit R-61, p. 30). Did he use the same page?
[2659] As to the other weeks allocated to the Appellant not much light was shed by the Appeals Officer except the reliability on the QMP scribbler. The Appellant however, gave a valid reason for making the one catch of eels. He also had a DFO slip dated July 1, 1993 for 302 or 307 pounds of speared eels from what I could make out from the bad copy of the Exhibit (Exhibit R-61, p. 12). The only delivery for July 1, 1993 which is shown in the QMP scribbler for that day is 25 pounds. Also the June 3 entry under the name of John Rayner appears to come from another buyer as was stated by Lynn Loftus in her examination by Roger Palmer on December 3, 1999, when she referred to page 30 of Exhibit R-60. On that page of the QMP scribbler there is the indication of 319 pounds of fish from another buyer by the name of Beaton. Mrs. Loftus in the case of Roger Palmer stated that the entry on that QMP scribbler (Exhibit R-60, p. 30) could either belong to Roger Palmer or another buyer by the name of Beaton.
[2660] Therefore in the case of John Rayner, the entry could belong also to either one of the names therein mentioned. The Appeals Officer seems to have attributed the catch of July 3, 1993 to the Appellant. What is most reliable? The QMP scribbler or the Appellant who corrected the Respondent's mistakes in the documentation and who has demonstrated that the QMP scribbler is not reliable?
[2661] This case is an example of what type of evidence the Respondent was requiring of the fishers. In this case, the Respondent had to admit his mistake, which is not uncommon or unusual in a case of this magnitude, but it took from March 9, to the presence of the Appeals Officer on December 2, 1999, up, until the moment prior to the questions being put to the Appeals Officer for the Respondent to advise the Court of the problem, which had been pointed out by the Appellant himself in March. Not only was the QMP scribbler page marked oysters instead of quahaugs but the Appellant also had a alibi for two of the weeks which were mistakenly allocated to him. He was fishing lobster from August 9 to October 16, 1993. This indicates that the Respondent appeared to require absolute proof of this Appellant that the QMP scribbler should not be relied upon.
[2662] Now if the QMP scribbler on page 13 of R-61, was quahaugs, who do they belong to? This Appellant or another John Rayner? When the volume analysis was carried out, were they calculated as oyster or quahaugs? These questions may never be answered.
[2663] I was very impressed with this young man, who was not contradicted. He established beyond a reasonable doubt that the QMP scribbler were not reliable and confirms in that respect what the Payor said since the beginning of the investigation, before any rulings or determinations were made.
[2664] This Appellant was a truthful witness, whose evidence cannot be disregarded.
[2665] The Appellant has established by a preponderance of evidence that he had no insurable earnings with the Payor in 1993.
[2666] This appeal must be allowed.
53. Bernice Rayner
[2667] This Appellant was heard on March 9, 1999. She was not represented by council or agent. The Appellant, Bernice Rayner, in appeal No. 97-522(UI), as to paragraph 8 of the Reply, admitted the allegations in subparagraphs a) to c), e), h), i) and k). The allegation in subparagraph f) was ignored. The allegations in subparagraphs d), g), j) and l) were denied and disproven by the evidence.
[2668] Exhibits R-62, R-62-1 to R-62-3 were filed in the Court record.
[2669] In 1993, the Appellant was a self-employed fisherperson, known under the name of Bernice MacDonald.
[2670] The Payor issued a record of employment to the Appellant for 1993, reporting two insurable weeks with insurable earnings of $1,120.00.
[2671] The Minister determined that the Appellant did not deliver any catch to the Payor in 1993 and as a result, had no insurable earnings with the Payor for 1993. This decision was based on the credibility of the QMP records (Exhibit R-62, p. 32). In essence, it was based on the fact that the Appellant's name did not appear in the QMP scribblers of the Payor.
[2672] The Appellant said that she delivered to the Payor according to what is indicated on her DFO slips. When she attended the interview, she brought with her the DFO slips which were photocopied (Exhibit R-62, pp. 14 and 15).
[2673] The Appellant also filed her statement of income with the Payor (Exhibit R-62-1). This document indicates insurable earnings of $1,120.00 which would correspond to the earnings described in her DFO slips (Exhibit R-62, pp. 14 and 15).
[2674] The Appellant was cross-examined. It was pointed out to the witness that the gross earnings of $1,208.08 on her T4F should be $1,280.08. She did not notice that. However, the T4F slip is in conformity with her DFO slip earnings.
[2675] The Appellant fished oysters and quahaugs. She sold to three different buyers because she was getting a better price.
[2676] She sold no eels to the Payor. When she fished oysters and eels, she used a boat. She was asked to explain how and where she fished. She said that the oysters she sold to Sharbell were picked off her grand father's lease. She stopped fishing because she had a skin disorder.
[2677] Her husband made no deliveries for her. No one made deliveries for her. These two weeks of fishing were needed by the Appellant in order to qualify for unemployment insurance benefits.
[2678] She made one delivery on July 24 and one delivery on October 30, 1993.
[2679] She explained when she fished and how she stored her catches prior to delivery.
[2680] Besides her DFO slips, she has no other records of the dates and/or the quantity of fish.
[2681] Counsel for the Respondent explained to the Appellant that there was no declarations for the deliveries to the Payor. The Appellant replied that she did not believe a fisherperson would get a copy of the declaration but she recalled signing something.
[2682] She said that in 1993 she had a three-year old child and when she fished her husband took care of the child.
[2683] The Appeals Officer, Elizabeth Whyte, was heard on December 2, 1999.
[2684] She was also cross-examined by the Appellant who brought out several discrepancies in the officer's report. The report indicated that no record of employment had been issued by the Payor in 1993 although one had been issued. The number of days of fishing was not seven but six.
[2685] The DFO slip for week ending October 30, 1993, mentioned in the report under the heading "Summary of Information" (Exhibit R-62, p. 31), shows an amount of $640.00. It should indicated $480.00 (Exhibit R-62, p. 14).
[2686] The Appellant questioned the Appeals Officer as to how she concluded that the John Rayner in the "QMP scribbler" was her husband. The Appeals Officer assumed it was her husband, but had not actually made an inquiry about that.
[2687] The Appeals Officer did agree with the Appellant that there were incorrect details in the report.
[2688] This Appellant demonstrated that she had carefully analyzed the report of the Appeals Officer.
[2689] The evidence of this Appellant was truthful. She was not contradicted and her evidence that she fished as she said must be accepted. No evidence showed that she submitted a false record of employment or made false statements in any claims for unemployment insurance benefits. The Appeals Officer's evidence showed no real reason for not accepting her explanation.
[2690] This Appellant has established by a preponderance of evidence that her insurable earnings are those described in her record of employment for 1993 issued by the accountant of the Payor according to the records kept under section 77 of the Regulations.
[2691] This appeal must be allowed.
54. Reby Bulger
[2692] The Appellant was heard on March 9, 1999. She was not represented by counsel or agent. The Appellant, Reby Bulger, in appeal No. 97-704(UI), as to paragraph 7 of the Reply, admitted the allegations in subparagraphs a) to c), h) and j). The allegations in subparagraphs e), i), k) and m) were admitted with explanations to be given at the hearing. The allegation in subparagraph f) was ignored. The allegations in subparagraphs d), g), l) and n) were denied and disproven by the evidence.
[2693] Exhibits R-63, R-63-1 to R-63-4 were filed in the Court record.
[2694] The Payor issued a record of employment to the Appellant in 1992 (Exhibit R-63, p. 7). This record indicated ten weeks of insurable earnings in the amount of $6,443.00.
[2695] The Payor also issued a record of employment to the Appellant in 1993 (Exhibit R-63, p. 25). This record indicated eleven weeks of insurable earnings in the amount of $6,572.00.
[2696] The Minister for the year 1992, determined that the Appellant had 13 insurable weeks with the Payor. Eight weeks were allowed for the minimum amount of $142.00 each, because of the reliability on the QMP records of the Payor. Five weeks were allowed, because the benefit of the doubt was given to the Appellant for her deliveries according to the DFO slips (Exhibit R-63, pp. 72 and 73) because there was nothing to refute the DFO records or confirm the QMP records.
[2697] The Minister for the 1993 year, determined that the Appellant had 19 insurable weeks with the Payor, with insurable earnings of $5,244.00. The worker's deliveries were not recorded in the QMP records of the Payor but the Appeals Officer stated in her report that "there is significant evidence to establish that the worker was present at the buyer's during this period and participated in, and delivered a catch with Linus Bulger". Further, the report states: "the benefit of doubt is given that a catch was delivered during weeks ending ... with Linus Bulger. His deliveries were recorded in the QMP scribbler and will be used to determine the workers catch" (Exhibit R-63, pp. 90 and 91) Linus Bulger is the Appellant's husband.
[2698] The Appellant admitted that the records of employment issued by the Payor were based on the DFO slips. The record of employment for 1992 (Exhibit R-63, p. 7) indicates the dates of delivery. These dates do not correspond to the dates on the DFO slips. The Appellant said that the bookkeeper would have indicated all the dates for Saturdays which would be the date for the week-ending. The Appellant and her husband, Linus Bulger, delivered every day but would receive a DFO slip once a week.
[2699] The 1993 record of employment (Exhibit R-63, p.25) indicated delivery dates based on the DFO slips. The dates are pretty well those indicated on the DFO slips (Exhibits R-63, pp. 27 to 44 and R-63-1). The Appellant agrees with what her husband said in relation to the use of the harvester when picking clams. When fishing clams, the Appellant would travel by boat to get to the area of fishing. Her husband, the Appellant Linus Bulger, would use the mechanical harvester and the Appellant would walk behind him and fish by hand. The Appellant used the harvester on very few occasions. The Appellant delivered with her husband and the catches and subsequent deliveries were split 60% and 40%. This last percentage would be that of the Appellant. The permit for the harvester was in her husband's name.
[2700] The Appellant filed her eleven DFO slips for 1993 (Exhibit R-63-1). She obtained those from the Department of Fisheries and Oceans, in Moncton.
[2701] She met with the investigator Lew Stevenson. She brought her DFO slips with her. She advised the investigator that she had her DFO slips with her. No one asked to see them. She was told that her name was not in the QMP scribbler for the years 1992 and 1993.
[2702] The Appellant received a letter dated January 11, 1996, indicating to her that HRDC referred the file of the Payor to Revenue Canada in relation to employment dates from June 20 to August 29, 1992 and July 3 to October 15, 1993 (Exhibit R-63-2).
[2703] The Appellant indicated that all her DFO slips for 1992 were in the Exhibit book (Exhibit R-63, p.9-18).
[2704] The Appellant was cross-examined. She said that the split of the catch at 60%-40% was an estimate. She explained that her husband would get a maximum insurable week and she would take whatever was left. It did not therefore work out to be 60%-40%. She never fished without her husband. When she picked soft shell clams, her husband was always there. She fished oysters and quahaugs on her own. Her husband fished soft shell clams without the Appellant. She said that there would have been days that she could not go. Her husband then either hired someone else or fished alone.
[2705] She also said that her husband fished quahaugs and oysters without her. She fished quahaugs and oysters with her husband.
[2706] In reference to her DFO slip dated October 1, 1993 (Exhibit R-63-1), the Appellant said that this DFO slip would be for oysters. She could not explain why the number had been crossed out.
[2707] She was shown the DFO slip for October 15, 1993 (Exhibit R-63-1) and said that it represented 37 pecks of oysters. She said that the writing on the DFO slip No. B 362255 was not hers.
[2708] She said that she had the DFO slips, when she met Elizabeth White, the Appeals Officer, but she was not sure whether Mrs. White saw them.
[2709] She was referred to the two DFO slips for October 1 and October 15, 1993. Both DFO slips represented deliveries of oysters. She was asked if she fished one week with a boat and another week without. She explained that they have a number of oyster leases and some have shallow water. She could have used a boat on one lease and not on the other.
[2710] She has no other records but the DFO slips to determine whether she used a boat or not.
[2711] She was asked whether her catch was separated from that of her husband upon delivery. She replied that a certain number of boxes would be weighed and her husband would claim those and the balance of the catch would belong to her. She did not make any written declarations in 1992. In 1992, she received her DFO slips and her record of employment. She was usually paid when she picked up her DFO slip. It was possible that her husband would have made some deliveries without her, but not many times. She said that sometimes she would stay in the truck because she was either very dirty, tired or wet. She said that she would go into the store and fill out the part of the form and someone at the fish mart would fill in the rest. She also said that sometimes her husband would bring the declaration out to the truck for her to sign and she would sign a blank form and give it back to Dale Sharbell.
[2712] She was cross-examined as to the 1992 DFO slips. She stated that the writing on the slips belonged to Marilyn Enman. She said that this person was not at the store. Her understanding was that Dale Sharbell would have the DFO slips made out by Marilyn Enman who was the Payor's bookkeeper. She said that in 1992, she would not usually make a delivery the day she received a DFO slip. It was given to her later. It was pointed out to the Appellant that on one of her declarations for 1993 (Exhibit R-63, p. 27), it appears that she was alone fisherman. She was asked where did she indicate to the buyer that she was sharing her catch with her husband. She replied that she did not have any paperwork to show that, but she and her husband were fishing for more than twenty years so, they assumed that the buyer knew.
[2713] She said she has a boat. When she was paid, the buyer deducted the unemployment premiums. She admitted that she possibly would have picked up her husband's pay. Her husband could have picked up her pay when she was not there to make her deliveries.
[2714] She filled out two questionnaires, for the 1992 and 1993 fishing periods. In the 1993 questionnaire, (Exhibit R-63, p. 49) she stated that she sold soft shell clams to the Payor. She admitted that she also sold oysters and quahaugs and that it was an oversight on her part not to have indicated that on the questionnaire.
[2715] The Appeals Officer, Elizabeth Whyte, was heard on December 2, 1999 in the case of this Appellant's husband, Linus Bulger. Reby Bulger had no question for Elizabeth Whyte.
[2716] The Appellant's name did not appear in the Payor's "QMP scribbler" for 1992 or 1993.
[2717] The only explanation given by the Appeals Officer was that the "QMP scribbler", according to Revenue Canada was more reliable to establish her earnings for the period from June 20 to July 25, 1992 and September 19 to 20, 1992 than the DFO slips for the same periods. The net result was that the Appellant was given 8 insurable weeks at the minimum allowable insurable earnings for $142.00 for those 8 weeks.
[2718] However, since the QMP scribblers were not reliable for the week of August 1 to 29, 1992 she was accorded the five weeks in that period for the amounts listed in her DFO slips.
[2719] In 1993, the Appeals Officer gave the Appellant the benefit of the doubt. What this meant was that the Respondent believed that the Appellant had fished but because the Respondent relied on the conclusions reached by the Respondent as to the reliability of the QMP scribbler, the Appellant was accorded the minimum weeks of insurable earnings at $149.00.
[2720] The situation in this case was that the Appeals Officer believed she had fished but in her determination followed the same procedure as she explained earlier on December 2, 1999 when testifying in the files pertaining to other Appellants and in particular in the cases of Dale and Sandra Rafferty and Linus Bulger.
[2721] Elizabeth Whyte took no part in the analysis made by the Respondent as to the accuracy of the "QMP scribbler" and followed the position adopted by Lynn Loftus as set out in the master file. The Appellant wondered and rightly so, how some of her DFO slips are accepted for some weeks and not for others when having been made up by the same Payor
[2722] The Appeals Officer appeared very concerned about this Appellant and her husband, Linus Bulger. I refer you to the cross-examination of Elizabeth Whyte by counsel, for Linus Bulger on December 2, 1999.
[2723] This Appellant was not contradicted as to how she and her husband fished. It did not appear to the Court that this person did not fish for was represented on her records of employment which were made up from the DFO slips for 1992 and 1993, which are in the record.
[2724] The fact that she split her catch would not be unusual, especially since she was fishing with her husband. Furthermore, a review of her records of employment compared with those of her husband for 1992 and 1993 (Exhibits R-63, p. 7 and 25 and R-36, pp. 12 and 32) show that she invariably received less earnings than her husband and the deliveries appear to be mostly on the same days, which confirms what the Appellant said at the hearing which took place in 1999, close to six or seven years after all those events. The credibility of the Appellant has not been attacked and there is no reason to suspect that she was not telling the truth to the best of her knowledge.
[2725] The Appeals Officer in her report dated, January 14, 1997, (Exhibit R-63, pp. 60 and 75) decided for the 1992 year that the QMP was reliable for certain weeks and not for others. For the 1993 year, she determined all the Appellants' insurable earnings on the reliability of the QMP scribblers of the Payor.
[2726] On October 10, 1996, HRDC sent a letter to this Appellant indicating to her that her unemployment insurance claim dated October 31, 1993, was supported by a record of employment from the Payor, that she knew to be falsified (Exhibit R-63-3).
[2727] Not a shred of evidence heard in this appeal could support such an accusation. If this was true, why was it not submitted to the Appeals Officer before she made her decision? What about her 1992 record of employment? Did HRDC know that it was falsified?
[2728] No evidence showed that this Appellant would have participated in falsifying ROE's or any other documents or made false statements in relation to any claim for unemployment insurance benefits.
[2729] This Appellant has established by a preponderance of evidence that her insurable earnings are those described in her records of employment for 1992 and 1993 as issued by the bookkeeper or the accountant according to the records kept under section 77 of the Regulations.
[2730] This appeal must be allowed.
Signed at Ottawa, Canada, this 13th day of July 2000.
"S. Cuddihy"
D.J.T.C.C.
[1] SOR/83-110, 1983 Canada Gazette Part II, p 573
[3] (1997) 215 N.R. 352
[4] Tignish Auto Parts Inc. v. M.N.R. (185 N.R. 73)
[5] (1994, 178 N.R. 361 at 362-3 (F.C.A.)
[6] (1949) A.C. 24 at 36 (P.C.).
[7] [1974] S.C.R. 875 at 877.
[8] [1992] 1 S.C.R. 3 at 76-77.
[9] [1996] 1 F.C. 644 at 653 (C.A.), per Robertson J.A.
[10] SOR/89-375 25 July 1989
[13] Smith v. M.N.R. 1998 TCJ No 528
[14] Stanley v. M.N.R. 1998 TCJ No 51
[15] Bernard v. M.N.R. 1999 TCJ No 259