ONTARIO COURT OF JUSTICE
BETWEEN:
HIS MAJESTY THE KING
— AND —
DAVID MURRAY
Before Justice S. Murphy
Heard on June 25, 2025
Reasons for Judgment released on July 15, 2025
M. Flagg................................................................................................ counsel for the Crown
A. O’Brodovich......................................................... counsel for the accused, D. Murray
Murphy J.:
1This is a decision relating to the Crown’s Application to admit similar fact evidence regarding the 35 counts of fraud that Mr. Murray is facing.
2At the commencement of the Trial, and throughout the proceedings, the Defence has admitted the following elements of the Crown’s case:
i) Mr. Murray was the owner and operator of the company, EcoLife Home Improvements Inc.;
ii) Mr. Murray’s company, EcoLife Home Improvements Inc. and each Complainant entered into a contractual relationship, and Mr. Murray’s identity as a person and as an authorized representative of the company is not in issue;
iii) The timeframe as between 2017 and 2019 is not in issue for any of the contracts, or the performance or non-performance of the contract;
iv) Mr. Murray received money from each complainant;
v) Mr. Murray and/or the workers from the company EcoLife either started work and did not finish regarding each contract, or did not start work at all;
vi) The money for each complainant was not refunded (with one exception of the return of a deposit); and
vii) Other admissions were made, which are not relevant for the purpose of assessing the Crown’s application.
3The Crown has filed an Application for the Evidence as against Mr. Murray in the Crown’s case to apply across all counts, or a Cross-Count Application. The burden on the Crown is on a balance of probabilities. The Crown relies on R. v. Handy as the leading case regarding these Applications, which sets out the legal test to be applied.
4Mr. O’Brodovich, on behalf of Mr. Murray, concedes the Crown’s Application on all of the elements of the Handy test, with the exception of the basis of collusion, or that there is an air of reality to the risk of collusion. If I find that there is an air of reality to the risk of collusion or that there has been collusion, the obligation is on the Crown to disprove collusion.
5The Defence says that the Crown has not discharged that obligation. The Crown argues that there is no air of reality to the risk of collusion and that there is no evidence of collusion in this case.
6When pressed regarding exactly where the collusion as between Complainants, or as between the Complainants and the police, the Defence focused on the area of the timing of the filing of the complaint to the police.
7The theory of the Defence is that none of the Complainants believed that they had been deceived by Mr. Murray until they learned of a Facebook Group called Victims of EcoLife, until they learned of a protest against EcoLife held in March of 2019 in Tom Davies Square in Sudbury, until they became aware of media coverage regarding disgruntled customers of EcoLife Home Improvements Inc., or some combination of those things.
8The Defence claims that deceit is part of the mens rea that the Crown has to prove. He argues that the subjective belief of the Complainants was influenced by the Facebook group, the media and/or the protest, and so their subjective belief that they were deceived forms part of the analysis whether or not mens rea has been established.
9The Crown argues that the subjective belief of each Complainant is legally irrelevant to any issue and does not form part of the mens rea of the offence of fraud.
10I agree with the position of the Crown. The subjective belief of any Complainant that he or she has been deceived is irrelevant to the legal analysis that I have to undertake. As well, the timing of any change in view of the Complainant about whether or not they had been deceived is also irrelevant to any analysis that I must undertake.
11Mens rea was defined by the Supreme Court of Canada in the seminal case of R. v. Théroux, 1993 CanLII 134 (SCC), [1993] 2 SCR. At page 15, Justice McLachlan writing for the majority said:
“2. The Actus Reus of Fraud
Since the mens rea of an offence is related to its actus reus, it is helpful to begin the analysis by considering the actus reus of the offence of fraud. Speaking of the actus reus of this offence, Dickson J. (as he then was) set out the following principles in Olan:
(i) the offence has two elements: dishonest act and deprivation;
(ii) the dishonest act is established by proof of deceit, falsehood or "other fraudulent means";
(iii) the element of deprivation is established by proof of detriment, prejudice, or risk of prejudice to the economic interests of the victim, caused by the dishonest act.
Olan marked a broadening of the law of fraud in two respects. First, it overruled previous authority which suggested that deceit was an essential element of the offence. Instead, it posited the general concept of dishonesty, which might manifest itself in deceit, falsehood or some other form of dishonesty. Just as what constitutes a lie or a deceitful act for the purpose of the actus reus is judged on the objective facts, so the "other fraudulent means" in the third category is determined objectively, by reference to what a reasonable person would consider to be a dishonest act. Second, Olan made it clear that economic loss was not essential to the offence; the imperilling of an economic interest is sufficient even though no actual loss has been suffered. By adopting an expansive interpretation of the offence, the Court established fraud as an offence of general scope capable of encompassing a wide range of dishonest commercial dealings.”
12Accordingly, the concept of deceit relates to the actus reus of the offence, and it is to be determined on an objective basis, rather than the subjective belief of the Complainant.
13However, it also relates to the mens rea. Justice McLachlan went on to discuss mens rea in the following manner:
“3. The Mens Rea of Fraud
(i) Doctrinal Considerations
This brings us to the mens rea of fraud. What is the guilty mind of fraud? At this point, certain confusions inherent in the concept of mens rea itself become apparent. It is useful initially to distinguish between the mental element or elements of a crime and the mens rea. The term mens rea, properly understood, does not encompass all of the mental elements of a crime. The actus reus has its own mental element; the act must be the voluntary act of the accused for the actus reus to exist. Mens rea, on the other hand, refers to the guilty mind, the wrongful intention, of the accused. Its function in criminal law is to prevent the conviction of the morally innocent -- those who do not understand or intend the consequences of their acts. Typically, mens rea is concerned with the consequences of the prohibited actus reus. Thus in the crimes of homicide, we speak of the consequences of the voluntary act ‑‑ intention to cause death, or reckless and wilfully blind persistence in conduct which one knows is likely to cause death. In other offences, such as dangerous driving, the mens rea may relate to the failure to consider the consequences of inadvertence.
This brings me to the question of whether the test for mens rea is subjective or objective. Most scholars and jurists agree that, leaving aside offences where the actus reus is negligence or inadvertence and offences of absolute liability, the test for mens rea is subjective. The test is not whether a reasonable person would have foreseen the consequences of the prohibited act, but whether the accused subjectively appreciated those consequences at least as a possibility. In applying the subjective test, the court looks to the accused's intention and the facts as the accused believed them to be: G. Williams, Textbook of Criminal Law (2nd ed. 1983), at pp. 727‑28.
Two collateral points must be made at this juncture. First, as Williams underlines, this inquiry has nothing to do with the accused's system of values. A person is not saved from conviction because he or she believes there is nothing wrong with what he or she is doing. The question is whether the accused subjectively appreciated that certain consequences would follow from his or her acts, not whether the accused believed the acts or their consequences to be moral. Just as the pathological killer would not be acquitted on the mere ground that he failed to see his act as morally reprehensible, so the defrauder will not be acquitted because he believed that what he was doing was honest.
The second collateral point is the oft‑made observation that the Crown need not, in every case, show precisely what thought was in the accused's mind at the time of the criminal act. In certain cases, subjective awareness of the consequences can be inferred from the act itself, barring some explanation casting doubt on such inference. The fact that such an inference is made does not detract from the subjectivity of the test.
Having ventured these general comments on mens rea, I return to the offence of fraud. The prohibited act is deceit, falsehood, or some other dishonest act. The prohibited consequence is depriving another of what is or should be his, which may, as we have seen, consist in merely placing another's property at risk. The mens rea would then consist in the subjective awareness that one was undertaking a prohibited act (the deceit, falsehood or other dishonest act) which could cause deprivation in the sense of depriving another of property or putting that property at risk. If this is shown, the crime is complete. The fact that the accused may have hoped the deprivation would not take place, or may have felt there was nothing wrong with what he or she was doing, provides no defence. To put it another way, following the traditional criminal law principle that the mental state necessary to the offence must be determined by reference to the external acts which constitute the actus of the offence (see Williams, supra, c. 3), the proper focus in determining the mens rea of fraud is to ask whether the accused intentionally committed the prohibited acts (deceit, falsehood, or other dishonest act) knowing or desiring the consequences proscribed by the offence (deprivation, including the risk of deprivation). The personal feeling of the accused about the morality or honesty of the act or its consequences is no more relevant to the analysis than is the accused's awareness that the particular acts undertaken constitute a criminal offence.
This applies as much to the third head of fraud, "other fraudulent means", as to lies and acts of deceit. Although other fraudulent means have been broadly defined as means which are "dishonest", it is not necessary that an accused personally consider these means to be dishonest in order that he or she be convicted of fraud for having undertaken them. The "dishonesty" of the means is relevant to the determination whether the conduct falls within the type of conduct caught by the offence of fraud; what reasonable people consider dishonest assists in the determination whether the actus reus of the offence can be made out on particular facts. That established, it need only be determined that an accused knowingly undertook the acts in question, aware that deprivation, or risk of deprivation, could follow as a likely consequence.
I have spoken of knowledge of the consequences of the fraudulent act. There appears to be no reason, however, why recklessness as to consequences might not also attract criminal responsibility. Recklessness presupposes knowledge of the likelihood of the prohibited consequences. It is established when it is shown that the accused, with such knowledge, commits acts which may bring about these prohibited consequences, while being reckless as to whether or not they ensue.
These doctrinal observations suggest that the actus reus of the offence of fraud will be established by proof of:
the prohibited act, be it an act of deceit, a falsehood or some other fraudulent means; and
deprivation caused by the prohibited act, which may consist in actual loss or the placing of the victim's pecuniary interests at risk.
Correspondingly, the mens rea of fraud is established by proof of:
subjective knowledge of the prohibited act; and
subjective knowledge that the prohibited act could have as a consequence the deprivation of another (which deprivation may consist in knowledge that the victim's pecuniary interests are put at risk).
Where the conduct and knowledge required by these definitions are established, the accused is guilty whether he actually intended the prohibited consequence or was reckless as to whether it would occur.”
14Justice McLachlan went on to say:
“The concern is that any misrepresentation or practice which induces an incorrect understanding or belief in the minds of customers, or which causes deprivation, will become criminal. As Marshall J.A. put it in Mugford, supra, at pp. 175‑76:
. . . it is not sufficient to base fraud merely upon a finding that the appellant induced a state of mind in his customers which was not correct. Any misrepresentation may have that effect. Criminal dishonesty extends further. . . .
It would be a startling extension of criminal liability if every statement urging the public to purchase one's wares because only a limited supply remain were by itself to be visited with criminal sanction.”
15Therefore, it is clear that the element of mens rea is from the perspective of Mr. Murray, not the perspective of any of the Complainants involved in this case. The fact that their views of the consequence of Mr. Murray’s acts or failure to act may have been influenced by other factors, such as media release, a Facebook group or a protest is completely irrelevant to any issue that I have to determine. These factors simply explain how and why and when each Complainant chose to report their concerns to the police.
16I find in the circumstances, that I do not find that there was collusion regarding any of the evidence given, on the part of any of the Complainants and that there is no air of reality to the issue of collusion.
17The Crown’s Application is granted and the evidence will apply across the counts.
Released: July 15, 2025
Signed: Justice S. Murphy