R. v. Bjellebo (E.S.) et al., (1999) 102 O.T.C. 81 (GD)

• Judge: Chapnik, J.
• Court: Ontario Court of Justice General Division (Canada)
• Case Date: April 06, 1999
• Jurisdiction: Ontario
• Citations: (1999), 102 O.T.C. 81 (GD)

R. v. Bjellebo (E.S.) (1999), 102 O.T.C. 81 (GD)

MLB headnote and full text

Temp. Cite: [1999] O.T.C. TBEd. AP.077

Her Majesty the Queen (respondent) v. Einar Sellander Bjellebo (alias Einar Bellfield) and Osvaldo Minchella (applicants)

(File No. F457/97)

Indexed As: R. v. Bjellebo (E.S.) et al.

Ontario Court of Justice

General Division

Chapnik, J.

April 6, 1999.

Summary:

In performing a civil audit of certain limited partnerships, Revenue Canada's Tax Avoidance (TA) section required certain documentation from the general partner. At the same time, Revenue Canada's Special Investigation (SI) section was undertaking a criminal investigation of the general partner. TA shared information with SI. The investigators deliberately transmitted the false impression that the investigation was restricted to a civil audit only. The investigation began in October 1986. SI obtained search warrants that were executed in June 1989. The accused were charged in a $118 million tax fraud scheme. The accused applied, under s. 24 of the Charter, to stay the proceedings against them or exclude all evidence obtained throughout Revenue Canada's investigation. They alleged violations of their ss. 7, 8, 11(b) and 11(d) Charter rights.

The Ontario Court (General Division) held that the accused's ss. 7 and 8 Charter rights were infringed when SI continued their investigation in an undercover manner after they had reasonable grounds to believe that an offence had been committed. However, the court refused to exclude the evidence, holding that its admission would not and could not bring the administration of justice into disrepute because the impugned evidence was discoverable by non-conscriptive means and likely would have been discovered through independent sources and other means, in any event. Further, the violation was incurred in good faith and was relatively minor in nature. The court held that the case justifiably received Revenue Canada's highest complexity rating and there was no pre-charge delay or abuse of process that violated s. 11 of the Charter.

Agency - Topic 323

Creation of relations - Parties - Who constitutes an agent - See paragraphs 123 to 141.

Civil Rights - Topic 1217

Security of the person - Lawful or reasonable search - What constitutes unreasonable search and seizure - See paragraphs 1 to 208.

Civil Rights - Topic 1508

Property - General principles - Expectation of privacy - See paragraphs 188 to 197 and 204 to 208.

Civil Rights - Topic 3130

Trials - Due process, fundamental justice and fair hearings - Criminal and quasi-criminal proceedings - Delay - See paragraphs 277 to 297.

Civil Rights - Topic 3265

Trials - Due process, fundamental justice and fair hearings - Speedy trial - Accused's right to - What constitutes "within a reasonable time" - See paragraphs 277 to 297.

Civil Rights - Topic 4302

Protection against self-incrimination - General - Right to remain silent - See paragraphs 209 to 230.

Civil Rights - Topic 4350

Protection against self-incrimination - Self-incriminating documents - Production of - Denial of right - See paragraphs 209 to 230.

Civil Rights - Topic 4456

Protection against self-incrimination - Proceedings to which protection does not apply - Income tax audits and inquiries - See paragraphs 209 to 230.

Civil Rights - Topic 8368

Canadian Charter of Rights and Freedoms - Denial of rights - Remedies - Exclusion of evidence - See paragraphs 231 to 276.

Civil Rights - Topic 8550

Canadian Charter of Rights and Freedoms - Interpretation - Particular words and phrases - Bring the administration of justice into disrepute (s. 24(2)) - See paragraphs 273 to 274.

Criminal Law - Topic 253

General principles - Abuse of process - What constitutes - See paragraphs 277 to 297.

Income Tax - Topic 9221

Enforcement - Inquiry (incl. audit) - General - See paragraphs 1 to 307.

Income Tax - Topic 9260

Enforcement - Production of information - "Foreign-based information or document" - See paragraphs 204 to 208.

Income Tax - Topic 9307

Enforcement - Search and seizure - Seizure of documents - Whether reasonable - See paragraphs 1 to 208.

Cases Noticed:

Baron et al. v. Minister of National Revenue et al., [1991] 1 F.C. 688; 122 N.R. 47 (F.C.A.), affd. (1993), 146 N.R. 270; 78 C.C.C.(3d) 510 (S.C.C.), refd to. [para. 8].

Schreiber v. Canada (Attorney General) (1998), 225 N.R. 297 (S.C.C.), appld. [para. 117].

Investors Syndicate Ltd. v. Versatile Investments Inc. (1983), 42 O.R.(2d) 397 (C.A.), refd to. [para. 124].

R. v. Kelly (1992), 137 N.R. 161; 9 B.C.A.C. 161; 19 W.A.C. 161; 73 C.C.C.(3d) 385 (S.C.C.), refd to. [para. 125].

R. v. Morris (1988), 64 Sask.R. 98 (C.A.), refd to. [para. 125].

Southam Inc. v. Hunter, [1984] 2 S.C.R. 145; 55 N.R. 241; 55 A.R. 291; 14 C.C.C.(3d) 97, appld. [para. 142].

R. v. McKinlay Transport Ltd. and C.T. Transport Inc., [1990] 1 S.C.R. 627; 106 N.R. 385; 39 O.A.C. 385; 55 C.C.C.(3d) 530, appld. [para. 142].

R. v. Potash; R. v. Selection Milton - see Comité paritaire de l'industrie de la chemise v. Potash et Sélection Milton.

Comité paritaire de l'industrie de la chemise v. Potash et Sélection Milton, [1994] 2 S.C.R. 406; 168 N.R. 241; 61 Q.A.C. 241; 91 C.C.C.(3d) 315, refd to. [para. 142].

R. v. Fitzpatrick (B.), [1995] 4 S.C.R. 154; 188 N.R. 248; 65 B.C.A.C. 1; 106 W.A.C. 1; 102 C.C.C.(3d) 144, refd to. [para. 148].

R. v. Norway Insulation Inc. (1995), 23 O.R.(3d) 432 (Gen. Div.), refd to. [para. 151].

R. v. Jarvis (W.J.) (1997), 195 A.R. 251 (Prov. Ct.), refd to. [para. 151].

R. v. Warawa (A.J.) (1997), 208 A.R. 81; 56 Alta. L.R.(3d) 67 (Q.B.), refd to. [para. 151].

R. v. Soviak, [1997] O.J. No. 1215 (C.J. Prov. Div.), refd to. [para. 151].

R. v. Harris (1995), 95 D.T.C. 5653 (B.C.S.C.), refd to. [para. 155].

R. v. Docouto (A.) et al. (1998), 77 O.T.C. 19 (Gen. Div.), refd to. [para. 156].

R. v. Melnychuk, [1998] S.J. No. 710 (Prov. Ct.), refd to. [para. 156].

R. v. Saplys (L.) (1999), 90 O.T.C. 100 (Gen. Div.), refd to. [para. 156].

R. v. Coghlan, [1994] 1 C.T.C. 164 (Ont. Prov. Ct.), refd to. [para. 157].

United States v. La Salle National Bank (1978), 437 U.S. 298, not folld. [para. 158].

United States v. Sclafina (1959), 265 F.2d 408, cert. denied 306 U.S. 918, not folld. [para. 158].

R. v. Ling (C.K.), [1998] B.C.T.C. Uned. 912 (S.C.), refd to. [para. 161].

Thomson Newspapers Ltd. v. Director of Investigation and Research, Combines Investigation Act et al., [1990] 1 S.C.R. 425; 106 N.R. 161; 39 O.A.C. 161; 54 C.C.C.(3d) 417, refd to. [para. 163].

Del Zotto v. Minister of National Revenue (1999), 252 N.R. 201 (S.C.C.), reving. (1997), 215 N.R. 184; 116 C.C.C.(3d) 123 (F.C.A.), refd to. [para. 165].

R. v. Gaudet (Y.) (1997), 202 N.B.R.(2d) 199; 516 A.P.R. 199 (Prov. Ct.), folld. [para. 171].

R. v. Wise, [1992] 1 S.C.R. 527; 133 N.R. 161; 51 O.A.C. 351; 70 C.C.C.(3d) 193, refd to. [para. 172].

Johnson v. Ontario (Minister of Revenue) (1990), 41 O.A.C. 129; 75 O.R.(2d) 558 (C.A.), refd to. [para. 172].

R. v. Debot (1986), 17 O.A.C. 141; 30 C.C.C.(3d) 207 (C.A.), affd. [1989] 2 S.C.R. 1140; 102 N.R. 161; 37 O.A.C. 1; 52 C.C.C.(3d) 193, refd to. [para. 175].

R. v. Storrey, [1990] 1 S.C.R. 241; 105 N.R. 81; 37 O.A.C. 161, refd to. [para. 176].

R. v. Feeney (M.), [1997] 2 S.C.R. 13; 212 N.R. 83; 91 B.C.A.C. 1; 148 W.A.C. 1; 115 C.C.C.(3d) 129, refd to. [para. 177].

R. v. Evans (C.R.) et al., [1996] 1 S.C.R. 8; 191 N.R. 327; 69 B.C.A.C. 81; 113 W.A.C. 81; 104 C.C.C.(3d) 23, refd to. [para. 188].

R. v. Edwards (C.), [1996] 1 S.C.R. 128; 192 N.R. 81; 88 O.A.C. 321; 104 C.C.C.(3d) 136, refd to. [para. 188].

R. v. Belnavis (A.) and Lawrence (C.), [1997] 3 S.C.R. 341; 216 N.R. 161; 103 O.A.C. 81; 118 C.C.C.(3d) 405, refd to. [para. 188].

R. v. Lauda (J.M.) (1998), 232 N.R. 1; 115 O.A.C. 293; 129 C.C.C.(3d) 225 (S.C.C.), refd to. [para. 190].

Lillian and Couch v. United States (1973), 409 U.S. 322, dist. [para. 192].

United States v. Young (Arthur) & Co. (1984), 465 U.S. 805, dist. [para. 192].

R. v. Pugliese (1992), 52 O.A.C. 280; 71 C.C.C.(3d) 295 (C.A.), refd to. [para. 196].

Schreiber v. Canada (Attorney General) (1997), 210 N.R. 9; 114 D.L.R.(4th) 711 (F.C.A.), revd. (1998), 225 N.R. 297 (S.C.C.), refd to. [para. 201].

R. v. Woolley (1988), 25 O.A.C. 390; 40 C.C.C.(3d) 531 (C.A.), refd to. [para. 210].

R. v. Rothman, [1981] 1 S.C.R. 640; 35 N.R. 485; 59 C.C.C.(2d) 30, refd to. [para. 211].

R. v. Hebert, [1990] 2 S.C.R. 151; 110 N.R. 1; 57 C.C.C.(3d) 1, refd to. [para. 211].

R. v. R.J.S., [1995] 1 S.C.R. 451; 177 N.R. 81; 78 O.A.C. 161; 36 C.R.(4th) 1; 96 C.C.C.(3d) 1, refd to. [para. 211].

R. v. Jones (S.), [1994] 2 S.C.R. 229; 166 N.R. 321; 43 B.C.A.C. 241; 69 W.A.C. 241, refd to. [para. 216].

R. v. Lyons, [1987] 2 S.C.R. 309; 80 N.R. 161; 82 N.S.R.(2d) 271; 207 A.P.R. 271, refd to. [para. 217].

British Columbia Securities Commission v. Branch and Levitt, [1995] 2 S.C.R. 3; 180 N.R. 241; 60 B.C.A.C. 1; 99 W.A.C. 1, refd to. [para. 219].

R. v. Brennan Paving and Construction Ltd. (1998), 115 O.A.C. 355 (C.A.), refd to. [para. 228].

R. v. Roberts (R.) (1991), 95 Nfld. & P.E.I.R. 49; 301 A.P.R. 49 (Nfld. Prov. Ct.), not folld. [para. 232].

Canada v. Peel Air Services Ltd. et al. (1992), 92 D.T.C. 6553 (Ont. Gen. Div.), not folld. [para. 232].

R. v. Agopsowicz (S.G.), [1994] 1 C.T.C. 119; 112 Sask.R. 163 (Prov. Ct.), not folld. [para. 232].

LaGiorgia v. Canada; Hunter et al. v. Skis Rossignol Canada Ltd. (1987), 77 N.R. 78; 35 C.C.C.(3d) 445 (F.C.A.), not folld. [para. 232].

R. v. White (H.S.) and Sennets (S.) (1997), 99 O.A.C. 1; 114 C.C.C.(3d) 225 (C.A.), folld. [para. 232].

R. v. Zborovsky (M.), [1997] O.A.C. Uned. 217 (C.A.), folld. [para. 232].

R. v. Goldhart (W.), [1996] 2 S.C.R. 463; 198 N.R. 321; 92 O.A.C. 161; 107 C.C.C.(3d) 481, refd to. [para. 234].

R. v. Stillman (W.W.D.), [1997] 1 S.C.R. 607; 209 N.R. 81; 185 N.B.R.(2d) 1; 472 A.P.R. 1; 113 C.C.C.(3d) 321, refd to. [para. 236].

R. v. Collins, [1987] 1 S.C.R. 265; 74 N.R. 276, refd to. [para. 236].

R. v. Harper, [1994] 3 S.C.R. 343; 172 N.R. 91; 97 Man.R.(2d) 1; 79 W.A.C. 1; 92 C.C.C.(3d) 423, refd to. [para. 241].

R. v. Bartle (K.), [1994] 3 S.C.R. 173; 172 N.R. 1; 74 O.A.C. 161; 92 C.C.C.(3d) 289, refd to. [para. 241].

United States v. Ceccolini (1978), 435 U.S. 268, refd to. [para. 258].

R. v. Therens, [1985] 1 S.C.R. 613; 59 N.R. 122; 40 Sask.R. 122, refd to. [para. 203].

R. v. Jacoy, [1988] 2 S.C.R. 548; 89 N.R. 61, refd to. [para. 263].

R. v. Harrer (H.M.), [1995] 3 S.C.R. 562; 186 N.R. 329; 64 B.C.A.C. 161; 105 W.A.C. 161; 101 C.C.C.(3d) 193, refd to. [para. 275].

R. v. Carter (1986), 67 N.R. 375; 26 C.C.C.(3d) 572 (S.C.C.), refd to. [para. 277].

R. v. Morin, [1992] 1 S.C.R. 771; 134 N.R. 321; 53 O.A.C. 241; 12 C.R.(4th) 1, refd to. [para. 278].

R. v. Kalanj; R. v. Pion, [1989] 1 S.C.R. 1594; 96 N.R. 191; 48 C.C.C.(3d) 459, refd to. [para. 279].

R. v. Mills, [1986] 1 S.C.R. 863; 67 N.R. 241; 16 O.A.C. 81; 26 C.C.C.(3d) 481, refd to. [para. 280].

R. v. Finta, [1994] 1 S.C.R. 701; 165 N.R. 1; 70 O.A.C. 241; 88 C.C.C.(3d) 417, refd to. [para. 280].

R. v. Jewitt, [1985] 2 S.C.R. 128; 61 N.R. 159; 21 C.C.C.(3d) 7, refd to. [para. 282].

R. v. W.K.L., [1991] 1 S.C.R. 1091; 124 N.R. 146; 64 C.C.C.(3d) 321, refd to. [para. 284].

R. v. G.A.F. - see R. v. Ford.

R. v. Ford (1989), 31 O.A.C. 377; 69 C.R.(3d) 92 (C.A.), refd to. [para. 284].

R. v. Young (1984), 3 O.A.C. 254; 13 C.C.C.(3d) 1 (C.A.), refd to. [para. 284].

R. v. H.P. (1992), 15 C.R.(4th) 121 (Ont. Gen. Div.), refd to. [para. 285].

R. v. La (H.K.) et al., [1997] 2 S.C.R. 680; 213 N.R. 1; 200 A.R. 81; 146 W.A.C. 81; 116 C.C.C.(3d) 97, refd to. [para. 286].

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; 103 C.C.C.(3d) 1, refd to. [para. 286].

Statutes Noticed:

Income Tax Act, R.S.C. 1985 (5th Supp.), c. 1, sect. 231.1(1) [para. 19]; sect. 231.3(1) [para. 20].

Authors and Works Noticed:

Bowstead on Agency (14th Ed. 1976), generally [para. 124].

Ewaschuk, Eugene G., Criminal Pleadings and Practice in Canada (2nd Ed. 1987), para. 31:22005 [para. 255].

Hubbard, R.W., and DeFreitas, P., Administrative Revenue Searches: Can they be Utilized in Aid of Criminal Investigations and Prosecutions?, Crim. L.Q., generally [paras. 168, 169].

Counsel:

Robert Hubbard, Peter De Freitas and Peter M. Brauti, for the respondent;

Louis D. Silver, Q.C., and James Silver, for Bellfield;

Chris Kostopoulos and Michael Passeri, for Minchella.

This application was heard on October 15, 16, 26-30, November 2-6, 9, 10, 12, 13, 16, 17, 23-27, 30, December 1-3, 7-9, 19, 1998, January 11-13, 18-22, 27-29, February 1-5, 8, 9, 16, March 8-12, 1999, by Chapnik, J., of the Ontario Court (General Division), who delivered the following decision at Toronto, Ontario, on April 6, 1999.