R. v. Derose (A.S.) et al., (2000) 275 A.R. 210 (ProvCt)

• Judge: Allen, P.C.J.
• Court: Provincial Court of Alberta (Canada)
• Case Date: November 28, 2000
• Citations: (2000), 275 A.R. 210 (ProvCt);2000 ABPC 192

R. v. Derose (A.S.) (2000), 275 A.R. 210 (ProvCt)

MLB headnote and full text

Temp. Cite: [2000] A.R. TBEd. DE.115

Her Majesty the Queen v. Antonio Salvatore Derose

Her Majesty the Queen v. Maria Derose

Her Majesty the Queen v. Sam Rocco Derose

(91081448P10101-05; 91081364P10101- 04; 91081687P10101-04; 2000 ABPC 192)

Indexed As: R. v. Derose (A.S.) et al.

Alberta Provincial Court

Allen, P.C.J.

November 28, 2000.

Summary:

The accused were charged with making false tax returns and income tax evasion. They challenged the admissibility of evi­dence obtained by Revenue Canada based on an infringement of their ss. 7 and 8 Charter rights. They sought to have the evidence excluded or to have the case stayed for an abuse of process.

The Alberta Provincial Court ruled that the evidence was admissible.

Editor's note: for related cases involving these accused see 264 A.R. 359, 268 A.R. 154 and 275 A.R. 201.

Civil Rights - Topic 1508

Property - General principles - Expectation of privacy - The accused were charged with making false tax returns and income tax evasion - The Crown argued that the accused had no standing to object under s. 8 of the Charter to the seizure of docu­ments respecting their closely held cor­porations and documents seized from financial institutions and other parties - The Alberta Provincial Court rejected the argument - They could assert standing respecting the documents given by them or representatives to the auditor, corporate documents seized from their homes and , to a degree, those documents both cor­porate and personal seized from the vari­ous bank locations because they had a right of access to their own personal accounts and that of the corporate entities - How­ever, standing did not mean that they would be able to establish a reasonable expectation of privacy to prevent the ad­mission of these documents - See para­graphs 216 to 218.

Civil Rights - Topic 1646

Property - Search and seizure - Un­reasonable search and seizure defined - The accused were charged with making false tax returns and income tax evasion -A Revenue Canada auditor and later an investigator obtained documents by sending letters of requirement under s. 232.1 of the Income Tax Act to the accuseds' financial institutions - The Alberta Provincial Court held that the seizures did not infringe the accused's s. 8 Charter rights in the cir­cumstances - The Act was regulatory and administrative in nature - The use of the letters was not an unreasonable invasion of privacy - They were directed to the ac­cused's bank accounts not their homes or offices where the expectation of privacy was greater - The records were not made by the accused - The auditor needed the documents to conduct a genuine audit and used the letters to obtain information re­specting accounts previously unknown to Revenue Canada - See paragraphs 219 to 236.

Civil Rights - Topic 1647

Property - Search and seizure - Persons protected - [See Civil Rights - Topic 1508 ].

Civil Rights - Topic 3160

Trials - Due process, fundamental justice and fair hearings - Criminal and quasi-criminal proceedings - Right to remain silent and protection against self-incrimina­tion (Charter, s. 7) - The accused were charged with making false tax returns and income tax evasion - The penalty included imprisonment - They argued that the In­come Tax Act placed compulsions on taxpayers to incriminate themselves and prevented them from remaining silent - A derivative use immunity prevented the use of the documents for the current prosecu­tion - The Alberta Provincial Court found no infringement of s. 7 in the circum­stances - The Revenue Canada auditor's actions here were part of a legitimate audit (not prosecution) - The documents sought already existed - They were relevant to income and deductions claimed in tax returns - Conversations with the accused and documents produced were an integral part of the Income Tax Act's self-reporting scheme - A need for derivative right im­munity disallowing the documents was not demonstrated - The documents were ulti­mately discoverable by Revenue Canada - See paragraphs 30 to 153.

Civil Rights - Topic 4302

Protection against self-incrimination - General - Right to remain silent - [See Civil Rights - Topic 3160 ].

Civil Rights - Topic 4304.2

Protection against self-incrimination - General - Compellability - Documents - [See Civil Rights - Topic 3160 ].

Civil Rights - Topic 4328

Protection against self-incrimination - Self-incriminating statements - Statements made under statutory compulsion - [See Civil Rights - Topic 3160 ].

Civil Rights - Topic 4350

Protection against self-incrimination - Self-incriminating documents - Production of - Denial of right - [See Civil Rights - Topic 3160 ].

Civil Rights - Topic 4456

Protection against self-incrimination - Proceedings to which protection does not apply - Income tax audits and inquiries - [See Civil Rights - Topic 3160 ].

Civil Rights - Topic 8368

Canadian Charter of Rights and Freedoms - Denial of rights - Remedies - Exclusion of evidence - The accused were charged with making false tax returns and income tax evasion - A Revenue Canada auditor and later an investigator obtained docu­ments by sending letters of requirement under s. 232.1 of the Income Tax Act to the accuseds' financial institutions - The Alberta Provincial Court held that the seizures did not infringe the accused's s. 8 Charter rights - Alternatively, the court would not have excluded the evidence - The bank records were not conscripted from the accused - They were real and existed prior to and independent of the alleged Charter breach - The alleged breach was not serious - The admission of the documents would not render the trial unfair or shock the conscience of fair minded individuals - See paragraphs 237 to 243.

Civil Rights - Topic 8380

Canadian Charter of Rights and Freedoms - Denial of rights - Remedies - Status - [See Civil Rights - Topic 1508 ].

Criminal Law - Topic 5339

Evidence - Witnesses - Confessions and voluntary statements - Admissibility - Statements made under statutory compul­sion - [See Civil Rights - Topic 3160 ].

Income Tax - Topic 9307

Enforcement - Search and seizure - Seizure of documents - Whether reasonable - [See Civil Rights - Topic 1646 ].

Cases Noticed:

R. v. Jarvis (W.J.) (1997), 195 A.R. 251 (Prov. Ct.), refd to. [para. 3].

R. v. Jarvis (W.J.) (1997), 204 A.R. 123 (Prov. Ct.), refd to. [para. 3].

R. v. Jarvis (1998), 225 A.R. 225 (Q.B.), refd to. [para. 3].

R. v. Jarvis (2000), 271 A.R. 263; 234 W.A.C. 263 (C.A.), refd to. [para. 3].

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, refd to. [para. 39].

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, refd to. [para. 40].

Knox Contracting and Knox Ltd. v. Cana­da (Minister of National Revenue) et al., [1990] 2 S.C.R. 338; 110 N.R. 171; 106 N.B.R.(2d) 408; 265 A.P.R. 408; 58 C.C.C.(3d) 65, refd to. [para. 45].

R. v. Wholesale Travel Group Inc. and Chedore, [1991] 3 S.C.R. 154; 130 N.R. 1; 49 O.A.C. 161, refd to. [para. 49].

Baron et al. v. Minister of National Reve­nue, [1993] 1 S.C.R. 416; 146 N.R. 270; 78 C.C.C.(3d) 510; 18 C.R.(4th) 374, refd to. [para. 51].

R. v. M.B.P., [1994] 1 S.C.R. 555; 165 N.R. 321; 70 O.A.C. 161, refd to. [para. 52].

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; 89 C.C.C.(3d) 353, refd to. [para. 53].

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. 56].

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; 97 C.C.C.(3d) 505; 123 D.L.R.(4th) 362, refd to. [para. 62].

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, refd to. [para. 68].

R. v. White (J.K.), [1999] 2 S.C.R. 417; 240 N.R. 1; 123 B.C.A.C. 161; 201 W.A.C. 161; 135 C.C.C.(3d) 257, refd to. [para. 75].

Del Zotto v. Minister of National Revenue, [1999] 1 S.C.R. 3; 252 N.R. 201; 169 D.L.R.(4th) 130 (S.C.C.), refd to. [para. 89].

Del Zotto v. Minister of National Revenue (1997), 215 N.R. 184; 116 C.C.C.(3d) 123 (F.C.A.), refd to. [para. 89].

R. v. Norway Insulation Inc. (1995), 95 D.T.C. 5328 (Ont. Gen. Div.), refd to. [para. 103].

Southam Inc. v. Hunter, [1984] 2 S.C.R. 145; 55 N.R. 241; 55 A.R. 291; 14 C.C.C.(3d) 97, refd to. [para. 157].

R. v. Collins, [1987] 1 S.C.R. 265; 74 N.R. 276; 56 C.R.(3d) 193; [1987] 3 W.W.R. 699; 38 D.L.R.(4th) 508; 33 C.C.C.(3d) 1, refd to. [para. 157].

R. v. Colarusso, [1994] 1 S.C.R. 20; 162 N.R. 321; 69 O.A.C. 81; 87 C.C.C.(3d) 193, refd to. [para. 163].

R. v. Plant (R.S.), [1993] 3 S.C.R. 281; 157 N.R. 321; 145 A.R. 104; 55 W.A.C. 104; 84 C.C.C.(3d) 203, refd to. [para. 172].

Quebec (Sous-ministre du Revenu) et autres v. 143471 Canada Inc. et autres (1994), 167 N.R. 321; 61 Q.A.C. 81; 90 C.C.C.(3d) 1, refd to. [para. 173].

R. v. Potash - 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), 168 N.R. 241; 61 Q.A.C. 241; 91 C.C.C.(3d) 315 (S.C.C.), refd to. [para. 178].

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. 189].

R. v. Belnavis (A.) and Lawrence (C.), [1997] 3 S.C.R. 341; 216 N.R. 161; 103 O.A.C. 81; 151 D.L.R.(4th) 443; 118 C.C.C.(3d) 405, refd to. [para. 194].

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. 195].

R. v. Silveira (A.) (1995), 181 N.R. 161; 81 O.A.C. 161; 97 C.C.C.(3d) 450 (S.C.C.), refd to. [para. 195].

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, application for rehearing granted [1997] 2 S.C.R. 117, refd to. [paras. 195, 229].

Schreiber v. Canada (Attorney General), [1998] 1 S.C.R. 841; 225 N.R. 297, refd to. [para. 196].

R. v. Kokesch (1990), 121 N.R. 161; 61 C.C.C.(3d) 207, refd to. [para. 208].

R. v. Warawa (A.J.) (1997), 208 A.R. 81 (Q.B.), refd to. [para. 209].

R. v. Yipp, [2000] A.J. No. 53 (Prov. Ct.), refd to. [para. 209].

R. v. Vickers (P.) (2000), 264 A.R. 347 (Prov. Ct.), refd to. [para. 210].

Salomon v. Salomon & Co., [1897] A.C. 22 (H.L.), refd to. [para. 217].

R. v. Roberts and Vicars, [1998] B.C.J. No. 3184 (Prov. Ct.), dist. [para. 233].

R. v. Salyps, [1990] O.J. No. 394 (Gen. Div.), dist. [para. 233].

R. v. Harris (1995), 95 D.T.C. 5653 (B.C.S.C.), dist. [para. 233].

R. v. Caswell, [1994] B.C.J. No. 437 (Prov. Ct.), dist. [para. 233].

R. v. Soviak, [1997] O.J. No. 1215 (Gen. Div.), dist. [para. 233].

R. v. Strachan, [1988] 2 S.C.R. 980; 90 N.R. 273; 46 C.C.C.(3d) 479; 67 C.R.(3d) 87; 56 D.L.R.(4th) 673; 37 C.R.R. 335; [1989] 1 W.W.R. 385, refd to. [para. 242].

R. v. Therens, [1985] 1 S.C.R. 613; 59 N.R. 122; 40 Sask.R. 122; 18 D.L.R.(4th) 655; [1985] 4 W.W.R. 286, refd to. [para. 244].

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. [paras. 244, 304].

R. v. Terry (R.S.), [1996] 2 S.C.R. 207; 197 N.R. 105; 76 B.C.A.C. 25; 125 W.A.C. 25; 106 C.C.C.(3d) 508, refd to. [para. 244].

R. v. Grant (D.), [1993] 3 S.C.R. 223; 159 N.R. 161; 35 B.C.A.C. 1; 57 W.A.C. 1; 84 C.C.C.(3d) 173, refd to. [para. 267].

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; 60 C.C.C.(3d) 161, refd to. [para. 274].

R. v. Madrid (L.A.) et al. (1994), 48 B.C.A.C. 271; 78 W.A.C. 271 (C.A.), refd to. [para. 284].

R. v. Araujo (A.) (1998), 109 B.C.A.C. 131; 177 W.A.C. 131; 127 C.C.C.(3d) 315 (C.A.), refd to. [para. 285].

R. v. Carrier (A.J.) (1996), 181 A.R. 284; 116 W.A.C. 284 (C.A.), refd to. [para. 286].

R. v. Morris (W.R.) (1998), 173 N.S.R.(2d) 1; 527 A.P.R. 1; 23 C.R.(5th) 354 (C.A.), refd to. [para. 290].

R. v. Leduc, [1993] 3 S.C.R. 641, refd to. [para. 304].

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. 304].

R. v. Power (E.), [1994] 1 S.C.R. 601; 165 N.R. 241; 117 Nfld. & P.E.I.R. 269; 365 A.P.R. 269; 89 C.C.C.(3d) 1; 29 C.R.(4th) 1, refd to. [para. 304].

R. v. Cook (D.W.), [1997] 1 S.C.R. 113; 210 N.R. 197; 188 N.B.R.(2d) 161; 480 A.P.R. 161; 114 C.C.C.(3d) 481, refd to. [para. 304].

Statutes Noticed:

Income Tax Act, R.S.C. 1985 (5th Supp.), c. 1, sect. 231.1, sect. 231.2, sect. 238(1), sect. 239 (1) [para. 33].

Canadian Charter of Rights and Freedoms, 1982, sect. 7 [para. 37]; sect. 8 [para. 156]; sect. 24(2) [para. 238].

Counsel:

E. Bottcher, for the Crown;

R. Davidson, Q.C., for all accused.

This voir dire was heard before Allen, P.C.J., of the Alberta Provincial Court, who delivered the following judgment on Novem­ber 28, 2000.