Quebec (Procureur général) v. Laroche et al., (2002) 295 N.R. 291 (SCC)

• Judge: McLachlin, C.J.C., L'Heureux-Dubé, Gonthier, Iacobucci, Bastarache, Arbour and LeBel, JJ.
• Court: Supreme Court (Canada)
• Case Date: November 21, 2002
• Jurisdiction: Canada (Federal)
• Citations: (2002), 295 N.R. 291 (SCC);2002 SCC 72

Que. (P.g.) v. Laroche (2002), 295 N.R. 291 (SCC)

MLB headnote and full text

[French language version follows English language version]

[La version française vient à la suite de la version anglaise]

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Temp. Cite: [2002] N.R. TBEd. NO.018

Procureur général du Québec (appellant) v. Laurent Laroche et Garage Côté Laroche Inc. (respondents) and L'honorable Claude Pinard, j.c.q. (respondent) and Procureur général du Canada et Procureur général de l'Ontario (intervenor)

(28417; 2002 SCC 72; 2002 CSC 72)

Indexed As: Quebec (Procureur général) v. Laroche et al.

Supreme Court of Canada

McLachlin, C.J.C., L'Heureux-Dubé, Gonthier, Iacobucci, Bastarache, Arbour and LeBel, JJ.

November 21, 2002.

Summary:

Laroche's automotive repair business rebuilt damaged vehicles, which required certificates of technical compliance from the Société de l'assurance automobile du Québec (SAAQ) before being allowed back on the road. A SAAQ employee found serious ir­regu­larities in an audit of five rebuilt vehicle files sub­mitted by Laroche (i.e., "chop shop" activ­ity). The employee notified police. Police seized the five vehicles (Cri­minal Code, s. 487). Police subsequently seized 154 rebuilt vehicle files from SAAQ. Irregu­larities were apparent in 98 of 142 files analyzed. La­roche had recently pur­chased $1,800,000 in immoveables (indus­trial con­dominiums), with no hypothecary charges against them. Police believed the condomini­ums were pur­chased with the proceeds of crime. Pursu­ant to ss. 462.32 and 462.33, police obtained seven special warrants of seizure (vehicles) and a restraint order (immoveables). When police executed the warrants, they seized vehicles identified in the warrants and 24 vehicles not ident­ified. Laroche applied under s. 462.34 for judicial review of the warrants and restraint order.

The Quebec Superior Court, in a judgment reported [2001] Q.J. No. 7209, quashed the warrants and restraint order. The turning over of information from SAAQ to police violated Laroche's privacy interests protected by s. 8 of the Charter. Accordingly, since the special warrants and restraint order derived from information obtained in illegal searches and seizures, the warrants were quashed in their entirety. The restraint order was also quashed, as there did not exist reasonable and probable grounds for believing that the condominiums were the proceeds of crime. The Attorney General obtained leave to appeal to the Supreme Court of Canada under s. 40 of the Supreme Court Act.

The Supreme Court of Canada, McLachlin, C.J.C., and Arbour, JJ., dissenting in part, allowed the appeal in part. It was conceded that the disclosure of information from SAAQ to police did not violate s. 8 of the Charter. After setting out the nature and extent of the review of special warrants and restraint orders, the court restored the restraint order and the seven special war­rants, with the exception of 24 vehicles not identified in the warrants.

Civil Rights - Topic 1217

Security of the person - Lawful or reason­able search - What constitutes unreasonable search and seizure - An employee of the Société de l'assurance automobile du Qué­bec (SAAQ) was auditing rebuilt vehicle files submitted by Laroche to obtain certi­ficates of techni­cal compliance, which permitted the vehi­cle to be put back on the road - La­roche was required by statute and regula­tions to submit the information - Based on irregu­larities indicative of forged or fraud­ulent documents, the SAAQ employee forwarded the information to the police - Laroche submitted that the disclos­ure to police violated his privacy interests and consti­tuted an unreasonable seizure con­trary to s. 8 of the Charter - The Supreme Court of Canada held that there was no violation of s. 8, noting that the issue was now con­ceded by the parties - Laroche should have known that the infor­mation would necess­arily be examined and audited and was not private in relation to the gov­ernment - Transmitting information to police, to investigate irregularities, was connected with the performance of his duties - See paragraphs 83 to 84.

Civil Rights - Topic 1444

Security of the person - Right to privacy - Expectation of privacy - [See Civil Rights - Topic 1217 ].

Civil Rights - Topic 1644

Property - Search and seizure - Seizure defined - [See second Criminal Law - Topic 1986 ].

Criminal Law - Topic 1986

Offences against property - Possession or laundering of proceeds of crime - Restraint orders and special warrants (incl. revoca­tion or variation) - Laroche rebuilt dam­aged vehicles, which required certificates of technical compliance from the SAAQ before being allowed back on the road - A SAAQ employee found irregularities in an audit of five rebuilt vehicle files submitted by Laroche (i.e., "chop shop" activity) - The employee notified police - Police seized the five vehicles (Criminal Code, s. 487), then seized 154 rebuilt vehicle files from SAAQ - Irregularities were apparent in 98 of 142 files - Laroche had recently purchased $1,800,000 in immoveables (in­dustrial condominiums), with no hypothe­cary charges against them - Police believed the condominiums were purchased with the proceeds of crime - Pursuant to ss. 462.32 and 462.33, police obtained seven special warrants of seizure (vehicles) and a re­straint order (immoveables) - When police executed the warrants, they seized vehicles identified in the warrants and 24 vehicles not identified - Laroche applied under s. 462.34 for judicial review of the warrants and restraint order - The Quebec Superior Court quashed the war­rants and restraint order - The turning over of infor­mation from SAAQ to police viol­ated Laroche's privacy interests protected by s. 8 of the Charter - Since the warrants and restraint order derived from informa­tion obtained in illegal seizures, the war­rants were quashed - The restraint order was also quashed, as there did not exist reason­able and probable grounds for be­lieving that the condomin­iums were the proceeds of crime - The Su­preme Court of Canada held that the dis­closure of informa­tion from SAAQ to po­lice did not violate s. 8 of the Charter - After setting out the nature and extent of the review of special war­rants and restraint orders, the court restored the restraint order and the seven special warrants, with the exception of 24 vehicles not identified in the warrants.

Criminal Law - Topic 1986

Offences against property - Possession or laundering of proceeds of crime - Restraint orders and special warrants (incl. revoca­tion or variation) - Sections 462.32 and 462.33 of the Criminal Code provided for restraint orders (real estate and intangible property such as bank accounts) and spec­ial warrants of seizure (tangible prop­erty such as vehicles) to preserve property prior to conviction - To obtain a warrant or restraint order, the Crown must establish reasonable and probable grounds to believe that an order of forfeiture may be made in respect of the property - The Supreme Court of Canada held that restricting prop­erty under a restraint order, without a change in possession, constituted a "seiz­ure" within the meaning of s. 8 of the Charter - The court stated that "given that a restraint order is intended to supplement seizures that are taking place contempor­aneously, and that they place property under the control of the justice system that might otherwise have eluded it, whether for the purpose of a criminal investigation or for punishment of crimes that fall with­in Part XII.2 of the Criminal Code, such an order must be characterized as a seizure within the meaning of s. 8 of the Charter" - See paragraph 54.

Criminal Law - Topic 1986

Offences against property - Possession or laundering of proceeds of crime - Restraint orders and special warrants (incl. revoca­tion or variation) - Laroche rebuilt dam­aged vehicles, which required certificates of technical compliance from the SAAQ before being allowed back on the road - A SAAQ employee found irregularities in an audit of five rebuilt vehicle files submitted by Laroche (i.e., "chop shop" activity) - The employee notified police - Police seized the five vehicles (Criminal Code, s. 487), then seized 154 rebuilt vehicle files from SAAQ - Irregularities were apparent in 98 of 142 files - Laroche had recently purchased $1,800,000 in immoveables (in­dustrial condominiums), with no hypothe­cary charges against them - Police believed the condominiums were purchased with the proceeds of crime - Pursuant to ss. 462.32 and 462.33, police obtained seven special warrants of seizure (vehicles) and a restraint order (immoveables) - Laroche applied under s. 462.34 for judi­cial review of the restraint order - The reviewing court quashed the restraint order, finding that there did not exist reasonable and probable grounds for believing that the condomin­iums were the proceeds of crime - The Supreme Court of Canada restored the re­straint order - Given Laroche's finan­cial circumstances, there existed reasonable and probable grounds to believe the condo­miniums were proceeds of crime - Once the basis for the restraint order was estab­lished, Laroche had the burden of estab­lishing, on a balance of probabilities, the origin of the funds used to purchase the condominiums to show that there was no reasonable and probable cause for the restraint order - Laroche failed to discharge that onus - See paragraphs 87 to 94.

Criminal Law - Topic 1986.1

Offences against property - Possession or laundering of proceeds of crime - Restraint orders and special warrants - Judicial review - Sections 462.32 and 462.33 of the Criminal Code provided for restraint orders and special warrants of seizure to preserve property prior to conviction - To obtain a warrant or restraint order, the Crown must establish reasonable and probable grounds to believe that an order of forfeiture may be made in respect of the property - The Supreme Court of Canada discussed the nature and extent of the statutory review of the authorizing judge's decision to issue a warrant or restraint order - Section 462.34(6) required the reviewing judge to determine whether the warrant "should not have been issued" or a restraint order "should not have been made" - According­ly, the review was not limited to determine whether there was sufficient evidence to justify issuing a warrant or restraint order -The court stated that "the judge must decide whether he or she would have made the same decision as the authorizing judge, having regard to all of the evidence in the judge's possession following the hearing of the application for review. If the reviewing judge does not share the opinion of his or her colleague, the authorizing judge, the reviewing judge must correct the previous judge's error. The reviewing judge cannot simply identify sufficient basis for belief on reasonable and probable grounds, as could be done in wiretap cases." - See paragraphs 63 to 71.

Practice - Topic 5408.1

Judgments and orders - General - Collat­eral attack - The Supreme Court of Canada stated that "limited exceptions, controlled by the courts, to the rule against collateral attacks do not offend the principle of the stability of judicial decisions, which retain its place as a central element in a sound administration of justice and an orderly judicial system. Recognition of such excep­tions, on the other hand, also allows for the integrity of the fundamental rule of law to be maintained, by ensuring compliance with that rule in situations where constitu­tional rights would otherwise be severely impaired, absent such a remedy." - See paragraph 76.

Cases Noticed:

R. v. Colarusso, [1994] 1 S.C.R. 20; 162 N.R. 321; 69 O.A.C. 81, refd to. [para. 20].

Wilson and Nakatsuru & Doucette v. R. (1993), 66 O.A.C. 219; 86 C.C.C.(3d) 464 (C.A.), refd to. [para. 25].

Oerlikon Aérospatiale Inc. v. Ouellette, [1989] R.J.Q. 2680 (C.A.), refd to. [para. 25].

170888 Canada Ltée v. La Reine, [1999] R.J.Q. 1008 (C.A.), refd to. [para. 33].

R. v. Brown (J.D.) (2002), 285 N.R. 201; 157 O.A.C. 1 (S.C.C.), refd to. [para. 46].

R. v. Araujo (A.), [2000] 2 S.C.R. 992; 262 N.R. 346; 143 B.C.A.C. 257; 235 W.A.C. 257, refd to. [para. 48].

R. v. Dyment, [1988] 2 S.C.R. 417; 89 N.R. 249; 73 Nfld. & P.E.I.R. 13; 229 A.P.R. 13, refd to. [para. 52].

Thomson Newspapers Ltd. et al. v. Direc­tor of Investigation and Research, Com­bines Investigation Act, [1990] 1 S.C.R. 425; 106 N.R. 161; 39 O.A.C. 161, refd to. [para. 52].

R. v. Seman (R.B.) (1994), 93 Man.R.(2d) 151 (Q.B.), disagreed with [para. 60].

British Columbia (Attorney General) v. Felix, [1993] B.C.J. No. 1870 (S.C.), disagreed with [para. 60].

Fremanco Ltd. v. R. (1995), 135 Nfld. & P.E.I.R. 327; 420 A.P.R. 327 (Nfld. S.C.), agreed with [para. 61].

R. v. Lanteigne (H.) et al. (1994), 156 N.B.R.(2d) 17; 401 A.P.R. 17 (Q.B.), agreed with [para. 61].

R. v. Mac (M.K.) (2002), 287 N.R. 75; 159 O.A.C. 33 (S.C.C.), refd to. [para. 62].

R. v. Lamy (E.) (2002), 284 N.R. 311 (S.C.C.), refd to. [para. 62].

R. v. Garofoli et al., [1990] 2 S.C.R. 1421; 116 N.R. 241; 43 O.A.C. 1; 36 Q.A.C. 161, refd to. [para. 64].

R. v. Bisson (Y.), [1994] 3 S.C.R. 1097; 222 N.R. 365, refd to. [para. 64].

R. v. Wilson, [1983] 2 S.C.R. 593; 51 N.R. 321; 26 Man.R.(2d) 194, refd to. [para. 73].

R. v. Meltzer, [1989] 1 S.C.R. 1764; 96 N.R. 391, refd to. [para. 73].

Taylor and Western Guard Party v. Cana­dian Human Rights Commission, [1990] 3 S.C.R. 892; 117 N.R. 391, refd to. [para. 73].

R. v. O'Connor (H.P.), [1995] 4 S.C.R. 411; 191 N.R. 1; 68 B.C.A.C. 1; 112 W.A.C. 1, refd to. [para. 74].

R. v. Litchfield, [1993] 4 S.C.R. 333; 161 N.R. 161; 145 A.R. 321; 55 W.A.C. 321, refd to. [para. 74].

Canadian Broadcasting Corp. v. Dagenais et al., [1994] 3 S.C.R. 835; 175 N.R. 1; 76 O.A.C. 81, refd to. [para. 74].

R. v. Beaulac (J.V.), [1999] 1 S.C.R. 768; 238 N.R. 131; 121 B.C.A.C. 227; 198 W.A.C. 227, refd to. [para. 74].

R. v. Domm (G.) (1996), 95 O.A.C. 262; 111 C.C.C.(3d) 449 (C.A.), refd to. [para. 75].

Housen v. Nikolaisen et al. (2002), 286 N.R. 1; 219 Sask.R. 1; 272 W.A.C. 1 (S.C.C.), refd to. [para. 80].

Statutes Noticed:

Criminal Code, R.S.C. 1985, c. C-46, sect. 462.34(6)(a) [paras. 2, 65]; sect. 462.34(6)(b) [para. 8]; sect. 462.37(1) [para. 57]; sect. 462.37(2) [para. 58]; sect. 462.38(2) [para. 57].

Authors and Works Noticed:

Beaudoin, Gérald-A., and Mendes, Errol P., Canadian Charter of Rights and Free­doms (3rd Ed. 1996), p. 529 [para. 53].

Béliveau, Pierre, and Vauclair, Martin, Traité général de preuve et de procédure pénales (7th Ed. 2000), p. 264 [para. 26].

Chevrette, François, and Cyr, Hugo, La protection en matière de fouilles, per­quisitions et saisies, en matière de déten­tion, la non-rétroactivité de l'infraction et la peine la plus douce, in Beaudoin, Gérald-A., and Mendes, Errol P., Cana­dian Char­ter of Rights and Freedoms (3rd Ed. 1996), p. 529 [para. 53].

German, Peter Maurice, Proceeds of Crime: The Criminal Law, Related Stat­utes, Regulations and Agreements (1998 Looseleaf Ed.) (2002 Update, Release 1), p. 3-1 [para. 23].

Gold, Alan D., Proceeds of Crime, A Manual with Commentary on Bill C-61 (1998), p. 15 [para. 23].

Hutchinson, Scott C., Morton, James C., and Bury, M.P., Search and Seizure Law in Canada (1993 Looseleaf Ed.) (2002 Update, Release 2), pp. 2 to 5 [para. 53].

Pomerance, Renee, and Kapoor, Anil K.S., Search and Seizure: New Developments (1998), p. 5-4 [para. 26].

Reynolds, D.D. Graham, Selected Aspects of the Proceeds of Crime Provisions of the Criminal Code, in Search and Seiz­ure: New Developments (1998), p. 5-4 [para. 26].

Counsel:

Alain Pilotte, Daniel Grégoire, Patrick Michel and Serge Brodeur, for the appel­lant;

Christian Desrosiers and Denis Lavigne, for the respondents;

Bernard Laprade and François Lacasse, for the intervenor, Attorney General of Canada;

Trevor Shaw, for the intervenor, Attorney General for Ontario.

Solicitors of Record:

Attorney General's Prosecutor, Ste-Foy, Québec, for the appellant;

Desrosiers, Turcotte, Marchand, Massi­cotte, Montréal, Québec, for the respon­dents;

Department of Justice, Ottawa, Ontario, for the intervenor, Attorney General of Canada;

Department of the Attorney General, Toronto, Ontario, for the intervenor, Attorney General for Ontario.

This appeal was heard on January 16, 2002, before McLachlin, C.J.C., L'Heureux-Dubé, Gonthier, Iacobucci, Bastarache, Arbour and LeBel, JJ., of the Supreme Court of Canada.

On November 21, 2002, the judgment of the Supreme Court of Canada was delivered in both official languages and the following opinions were filed:

McLachlin, C.J.C. (Arbour, J., concur­ring), dissenting in part - see para­graphs 1 to 10;

LeBel, J. (L'Heureux-Dubé, Gonthier, Iacobucci and Bastarache, JJ., concur­ring) - see paragraphs 11 to 95.