Court File and Parties

Ontario Court of Justice

Date: 2019-05-09

Court File No.: Stratford 18-013583

Between:

REGINA — Respondent (Prosecution)

— AND —

DONALD JAMES MACKINNON — Applicant (Defendant)

Before: Justice of the Peace Anna M. Hampson

Heard on: May 9, 2019

Reasons for Judgment released on: May 9, 2019

Counsel

Arnie L. Vaughan — agent for the prosecution

Kyle McGraw — agent for the defendant Donald James MacKinnon

Reasons for Judgment

JUSTICE OF THE PEACE HAMPSON:

[1] On January 8, 2019, James MacKinnon pleaded guilty to the offence of owning and operating a motor vehicle without it being insured under a contract of automobile insurance contrary to s. 2(1)(a) of the Compulsory Automobile Insurance Act. The incident happened on July 24, 2018. On January 15, 2018, he was convicted of the same offence. As a result, this was the defendant's second conviction within 6 months. The defendant's application pursuant to s. 59(2) of the Provincial Offences Act was dismissed in light of the recent Ontario Court of Appeal decision in R. v. Henry of Pelham Inc., 2018 ONCA 999 which provided interpretive guidance for s. 59(2) applications. Difficulty paying the fine alone was not sufficient. I did not find that the defendant had demonstrated his circumstances were exceptional nor that the minimum fine would be unduly oppressive or contrary of justice particularly in light of the aggravating circumstance of it being his second conviction within 6 months. Although he was in difficult financial circumstances in that he had significant debt, he was living at home rent free, worked part time and sometimes full time and still owned the vehicle in question.

[2] Mr. McGraw on behalf of the defendant submitted that the Victim Fine Surcharge ought not to be imposed given the recent Supreme Court of Canada decision in R. v. Boudreault, 2018 SCC 58 which declared that the victim fine surcharge under s. 737 of the Criminal Code violated s. 12 of the Charter as it constituted cruel and unusual punishment that was not saved by s. 1 and immediately invalidated the section. The matter before me was adjourned for a proper application with factums and written submissions.

[3] The Notice of Application and Constitutional Question with the Factum and Books of Authorities was served on Mr. Vaughan as the local prosecutor as well as the Attorney General of Ontario and the Attorney General of Canada. No submissions were provided by either Attorneys General. Mr. Vaughan provided a Responding Factum and Book of Authorities. I reviewed all of this material as well as another case (Town of New Glasgow v. Jardine, 2018 NSPC 53) provided by Mr. McGraw. I also asked that the parties provide oral submissions on today's date.

[4] The Notice is in the prescribed form 4F. The defendant intends to question the constitutionality of s. 60.1 of the Provincial Offences Act. The defendant asks for "an order determining the constitutional validity of s. 60.1 of the Provincial Offences Act… based upon an infringement of the applicants rights under s. 7 and 12 of the Canadian Charter of Rights and Freedoms". In the section titled "Order Requested" the applicant requests "a ruling on the enforceability of s. 60.1 of the Provincial Offences Act" and "any other order which this Honourable Court considers fair and just".

Jurisdiction

[5] If this is an application to find that s. 60.1 is unconstitutional, then it would be an application under s. 52 The Constitution Act which states:

Primacy of Constitution of Canada

52. (1) The Constitution of Canada is the supreme law of Canada, and any law that is inconsistent with the provisions of the Constitution is, to the extent of the inconsistency, of no force or effect.

[6] This court does not have jurisdiction to formally declare a piece of legislation unconstitutional pursuant to s. 52 as only a superior court has such jurisdiction. However, judges of the Ontario Court of Justice, and justices of the peace, have the jurisdiction to find the provision invalid and to dismiss criminal charges against an accused on the ground that the legislation is of no force and effect, but they do not have the authority to issue a general declaration of invalidity: see R. v. Big M Drug Mart Ltd., [1985] 1 S.C.R. No. 295. This court is a court of competent jurisdiction to grant relief, such as costs or a stay of proceedings, from Charter violations pursuant to R. v. 974649 Ontario Inc., 2001 SCC 81, [2001] 3 SCR 575.

[7] Although not specifically pleaded, and after argument, I find that the present application appears to be pursuant to s. 24(1) of the Charter which reads:

24.(1) Anyone whose rights or freedoms, as guaranteed by this Charter, have been infringed or denied may apply to a court of competent jurisdiction to obtain such remedy as the court considers appropriate and just in the circumstances.

[8] The alleged charter breach is with respect to s. 12:

Everyone has the right not to be subjected to any cruel and unusual treatment or punishment.

[9] A second alleged charter breach is with respect to s. 7:

Everyone has the right to life, liberty and security of the person and the right not to be deprived thereof except in accordance with the principles of fundamental justice.

[10] Although there was no request for a "remedy", it was argued that if there was a charter breach that was not saved by s. 1, then the "remedy" would be to declare that s. 60.1 does not apply to the applicant.

[11] Mr. McGaw argues that there has been a breach of the defendant's rights pursuant to s. 12 and 7 of the Charter. Mr. Vaughan argues that there has not been a violation of said rights. For the following reasons, I dismiss the application.

Is the Victim Fine Surcharge in s. 60.1 Punishment?

[12] The Supreme Court of Canada found that the surcharge in s. 727 was punishment. While I appreciate that s. 727 of the Criminal Code has been determined to be unconstitutional and of no force and effect, it is still useful to examine this legislation and compare it to the POA legislation. There are some obvious differences between the provisions of s. 60.1 of the POA and s. 727 of the Criminal Code.

Provincial Offences Act

60.1 (1) If a person is convicted of an offence in a proceeding commenced under Part I or III and a fine is imposed in respect of that offence, a surcharge is payable by that person in the amount determined by regulations made under this Act.

Collection

(2) The surcharge shall be deemed to be a fine for the purpose of enforcing payment.

Priorities

(3) Any payments made by a defendant shall be credited towards payment of the fine until it is fully paid and then towards payment of the surcharge. 1994, c. 17, s. 130.

Part X agreements

(3.1) When an agreement made under Part X applies to a fine, payments made by the defendant shall first be credited towards payment of the surcharge, not as described in subsection (3). 1998, c. 4, s. 1 (1).

Special purpose account

(4) Surcharges paid into the Consolidated Revenue Fund shall be credited to the victims' justice fund account and shall be deemed to be money received by the Crown for a special purpose. 1994, c. 17, s. 130; 1995, c. 6, s. 7 (1).

Same

(4.1) Subsection (4) also applies to payments received under clause 165 (5) (a). 1998, c. 4, s. 1 (1).

(5), (6) Repealed: 1995, c. 6, s. 7 (2).

Regulations

(7) The Lieutenant Governor in Council may make regulations,

(a) prescribing the amount of the surcharges or the method by which they are to be calculated;

(b) Repealed: 1995, c. 6, s. 7 (2).

(c) exempting any offence or class of offence from the application of subsection (1). 1994, c. 17, s. 130; 1995, c. 6, s. 7 (2).

(8) Repealed: 1995, c. 6, s. 7 (2).

Criminal Code

737 (1) An offender who is convicted, or discharged under section 730, of an offence under this Act or the Controlled Drugs and Substances Act shall pay a victim surcharge, in addition to any other punishment imposed on the offender.

Amount of surcharge

(2) Subject to subsection (3), the amount of the victim surcharge in respect of an offence is

(a) 30 per cent of any fine that is imposed on the offender for the offence; or

(b) if no fine is imposed on the offender for the offence,

(i) $100 in the case of an offence punishable by summary conviction, and

(ii) $200 in the case of an offence punishable by indictment.

Increase in surcharge

(3) The court may order an offender to pay a victim surcharge in an amount exceeding that set out in subsection (2) if the court considers it appropriate in the circumstances and is satisfied that the offender is able to pay the higher amount.

Time for payment

(4) The victim surcharge imposed in respect of an offence is payable at the time at which the fine imposed for the offence is payable and, when no fine is imposed, within the time established by the lieutenant governor in council of the province in which the surcharge is imposed for payment of any such surcharge.

(5) and (6) [Repealed, 2013, c. 11, s. 3]

Amounts applied to aid victims

(7) A victim surcharge imposed under subsection (1) shall be applied for the purposes of providing such assistance to victims of offences as the lieutenant governor in council of the province in which the surcharge is imposed may direct from time to time.

Notice

(8) The court shall cause to be given to the offender a written notice setting out

(a) the amount of the victim surcharge;

(b) the manner in which the victim surcharge is to be paid;

(c) the time by which the victim surcharge must be paid; and

(d) the procedure for applying for a change in any terms referred to in paragraphs (b) and (c) in accordance with section 734.3.

Enforcement

(9) Subsections 734(3) to (7) and sections 734.3, 734.5, 734.7, 734.8 and 736 apply, with any modifications that the circumstances require, in respect of a victim surcharge imposed under subsection (1) and, in particular,

(a) a reference in any of those provisions to "fine", other than in subsection 734.8(5), must be read as if it were a reference to "victim surcharge"; and

(b) the notice provided under subsection (8) is deemed to be an order made under section 734.1.

(10) [Repealed, 2013, c. 11, s. 3]

[13] In oral argument and in response to my questions, the defendant argues that the POA surcharge is imposed by the court while the prosecution argued that it is imposed administratively. When comparing the language of the 2 sections, there are differences. In s. 737, the surcharge is "in addition to any other punishment imposed on the offender". Only a court can "impose" a punishment. In s. 60.1, the surcharge "is payable by that person". The surcharge also applies to Part 1 proceedings. In a Part 1 proceeding ie a ticket, the surcharge (s. 60.1) is included in the "total payable" along with court costs (s. 60) and the set fine. The set fine is set out separately from the "total payable". In examining a certificate pursuant to the default proceedings in s. 9(1)(b) (for failing to attend with a prosecutor after receiving notice) or in s. 9.1 (for failing to attend court after receiving a Notice of Trial), the certificate is complete and regular on its face if the set fine is correct and will not be quashed on that basis alone. If the total payable is incorrect or even missing but the set fine is correct, the certificate is still complete and regular on its face and will not be quashed for that reason alone. See: R. v. Wilson, [2001] O.J. No. 4907, para. 44; R. v. Khoshael, [2001] O.J. No. 2111; City of London v. Young, [2008] ONCA 429; R. v. Monahan, [2009] OJ No. 2696.

[14] In particular, Justice Livingston in Wilson held:

[40] Finally there have been numerous appeals in relation to an incorrect "total payable" being endorsed on the certificate of offence, either because of a miscalculation of the Victim Fine Surcharge, or an omission of it, in the addition of the figure to the amount of the set fine.

[41] R. v. Crossan and R. v. Klauke (supra) are conflicting judgments on this point.

[42] Two of the appeals here, Balaban and McIntosh, involve this issue.

[43] In my view, as I stated above, the amount of the set fine should be correct on the face of the certificate. As Justice Libman set out in Khoshael (supra), at page 4:

"Indeed, the recording of an erroneous set fine amount may give rise to adverse administrative results, as where the amount recorded constitutes an under-payment, thereby subjecting the defendant to the risk of being suspended from driving due to non-payment of the correct amount of the fine."

[44] But in relation to the amount of the Victim Fine Surcharge, I accept the reasoning of Justice Austin in R. v. Klauke (supra). She held that the amount of the surcharge is an administrative consequence flowing from the conviction, and that the recording of that amount is a "superfluous component of the certificate".

[15] Justice Caldwell in Monahan stated at para. 19:

19 Upon conviction the defendant is liable for three monetary amounts - the set fine for the offence, the court costs, and the victim fine surcharge. Set fines are set by the Chief Justice of the Ontario Court of Justice as authorized by statute. Both the court costs and the victim fine surcharge are set by the Lieutenant Governor in Council through regulations (see the POA, sections 13, 60(1) and 60.1(1)). There is no question, then, that the court costs and victim fine surcharge are different items than the set fines; in my view, this is one of the factors that is crucial to the determination of this case.

[16] There are other differences as well. Firstly, as can be seen, the amount of the s. 60.1 POA surcharge is determined by a regulation by the Lieutenant Governor in Council. Only by enacting a regulation is there an amount for the surcharge. With respect to s. 737 Criminal surcharge, the amount is set out within the section itself and would require an amendment to the criminal code to vary the amount. Secondly, there is no jurisdiction for the court in the POA to increase the amount of the surcharge as there is for the court to increase the amount of the surcharge s. 737. Thirdly, a surcharge is only payable in the POA if a fine is imposed. It is not payable if the defendant receives custody, probation or if the sentence is suspended. Under the criminal code, the surcharge is payable upon the conviction or discharge and is not dependent upon the sentence imposed: even if no fine is imposed and even if the accused is discharged, the surcharge applies. Fourthly, the POA surcharge is imposed administratively while the s. 737 surcharge is imposed by the court. Fifthly, the POA surcharge does not apply to offences pursuant to Part II of the POA (ie parking offences) while the s. 737 surcharge applies to all criminal code offences and those under the CDSA.

[17] I find that the surcharge in s. 60.1 is imposed by the administration and is not imposed by the court. As a result, I do not find that the POA surcharge in s. 60.1 is a form of punishment. It is an administratively imposed amount that is added to the fine that is payable by the defendant along with costs which also administratively imposed. While it can be enforced as if it were a fine, it is not imposed by the court. A court may make reference to the surcharge however, the court is not imposing the surcharge. A court may take into account the effect of the surcharge when considering the fine to be imposed as it is determined by the legislation: See R. v. Henry Heyink Construction Ltd., [1999] 1254 OCA, paras. 11-13. It doesn't mean however, that the fine is reduced proportionately by the amount of the surcharge. The fine is the punishment, not the surcharge. As a result, s. 12 of the Charter is not engaged.

Is There a Violation of s. 12?

[18] If I am wrong that the surcharge is punishment, then an analysis under s. 12 is necessary. Is the "punishment" is "so excessive as to outrage standards of decency and abhorrent or intolerable in society"? Mere disproportionate or excessive is not enough. It is a "high bar" to demonstrate a breach of s. 12.

[19] I do not find that the surcharge is "so excessive as to outrage standards of decency. Firstly, the court in Boudreault found that the VFS there was such the case as there were deeply disproportionate financial consequences regardless of moral culpability. The fundamental principle in sentencing criminal code matters is found in s. 718.1 "A sentence must be proportionate to the gravity of the offence and the degree of responsibility of the offender". The court found that the surcharge ignored the principle of proportionality. However, in the POA context, generally there is no "moral culpability" given that these are not criminal offences and are mostly strict liability which would allow a due diligence defence or perhaps absolute liability offences. It is very rare that there is a "mens rea" component to any regulatory offence. The main principle in sentencing POA matters is deterrence and not proportionality.

[20] Secondly, in Boudreault, the court also found that individuals lived with the threat of incarceration as a result of the imposition of the surcharge. In the POA matters, as discussed below in paragraph 33, there is no threat of incarceration if the surcharge is in default.

[21] Thirdly, in Boudreault, the court also found that offenders were targeted by collection efforts endorsed by their province of residence. In POA matters however, all fines payable by defendants that are in default are subject to collection efforts by the municipality in which they were incurred. This is not unusual nor excessive.

[22] Fourthly, in Boudreault, the court also concluded that the surcharge created a "defacto indefinite sentence" because there was no foreseeable way to pay the surcharge. In POA matters, a defendant can always bring an extension for time to pay fines and surcharges pursuant to s. 66(6). Such extensions are to be granted unless it is not made in good faith or would likely be used to evade payment. Even payment of a minimal amount on a monthly basis if done in good faith would suffice. These applications do not necessitate repeated appearances before the court as they can be done by a written application.

[23] Fifthly, in determining what an appropriate fine would be in the absence of the surcharge, the court can take into account the impact of the surcharge in accordance with the Ontario Court of Appeal decision in R. v. Henry Heyink Construction Ltd. cited above. Justice Goudge speaking on behalf of the court stated:

[13] In imposing sentence a trial judge can properly have regard to the surcharge and its economic impact on the accused. Having in mind the surcharge does not mean simply a proportionate reduction in the fine so that with the surcharge added, a predetermined amount is reached. Rather, in passing sentence it means taking account of the surcharge as a real life consideration that affects the economic circumstances of the accused and his or her capacity to pay.

[24] Sixthly, The Provincial Offences Act does not contain any sentencing principles like the Criminal Code provisions in s. 718, 718.1 and 718.2. There is no statement of sentencing principles within the POA. However, the main consideration in sentencing POA matters is deterrence. They are public welfare statutes that regulate many aspects of life-transportation, workplace, labour, health and safety for example. There is generally no "victim" as there are in criminal cases. All of the public is affected by breaches of public welfare statutes. As the Ontario Court of Appeal indicated in R. Henry of Pelham:

[33] As the Supreme Court noted in R. v. Sault Ste. Marie, [1978] 2 S.C.R. 1299, at pp. 1302-1303, regulatory offences "are in substance of a civil nature and might well be regarded as a branch of administrative law to which traditional principles of criminal law have but limited application." After all, regulatory offences are not "true crimes" – "conduct that is, in itself, so abhorrent to the basic values of human society that it ought to be prohibited completely": R. v. Wholesale Travel Group Inc., [1991] 3 S.C.R. 154, at p. 218. Regulatory offences arise in the context of conduct that is otherwise lawful – indeed, conduct that may be encouraged and promoted for the good of society, but which nevertheless requires regulation in the public interest: see Wholesale Travel, at pp. 216-222, per Cory J. As the Supreme Court noted more recently, "regulatory legislation does not share the same purpose as the criminal law, and it would be a mistake to interpret it as though it did": Wilson v. British Columbia (Superintendent of Motor Vehicles), 2015 SCC 47, [2015] 3 S.C.R. 300, at para. 34.

[34] It is not necessary to prove mens rea in order to prove the commission of regulatory offences, which involve strict liability. The Crown need prove only the commission of the prohibited act beyond a reasonable doubt. Liability follows unless the defendant can establish, on the balance of probabilities, a due diligence defence – that reasonable care was taken to avoid the commission of the prohibited act.

[35] Public welfare statutes regulate everything from driving to fishing, environmental protection and workplace health and safety. As noted above, the POA governs the penalties for committing regulatory offences unless the relevant statutes establish different penalties.

[25] Many of the public welfare statutes include minimum fines which are used to accomplish the goal of deterrence. As the Ontario Court of Appeal indicated in Henry of Pelham:

[38] In Cotton Felts, this court set out an inclusive list of general considerations when it comes to sentencing on public welfare offences, but it emphasized that the need to enforce regulatory standards through deterrence is paramount. Minimum fines are a policy tool that is often used to accomplish this goal.

[39] Minimum fines apply without regard to the circumstances of individual offenders or the circumstances surrounding the commission of particular offences, and so necessarily risk over inclusion. They reflect a legislative judgment that nothing less than the minimum fine is sufficient to achieve deterrence in light of the nature of the offence committed.

[26] A public welfare statute like the Compulsory Automobile Insurance Act governs an activity of owning a motor vehicle and operating it on the highway. The purpose of insurance is to protect an innocent party who may be injured in a collision. It achieves this goal by imposing minimum fines. As the Court of Appeal in Henry of Pelham indicated:

[56] There is nothing surprising about this, given the Legislature's purpose. Minimum fines are designed to deter and, as I have said, they are necessarily over inclusive to a greater or lesser extent. To take an example, the Compulsory Automobile Insurance Act establishes a minimum fine of $5,000 for driving without insurance. That is a high fine for most people and is especially so for people of modest means. But the cost of insurance is also high for most people and is also especially high for people of modest means. The Legislature chose to require drivers to have insurance regardless of the cost, and chose to enforce this requirement with a mandatory minimum penalty. The Legislature chose, in other words, "to make it more financially onerous to offend the legislation than to bear the required cost of insurance premiums": Ade-Ajayi, at para. 13. That choice was open to the Legislature, and it should not be undermined by a decision to refuse to impose a minimum fine simply because it seems high in particular circumstances. Minimum fines will often seem high; that is the point of deterrence in public welfare offences.

[27] Seventhly, the effect of the surcharge can also be taken into consideration in cases where there is a mandatory minimum fine. Even if a defendant's application pursuant to s. 59(2) is not accepted, there is nothing to prevent the court from taking into consideration the impact of the surcharge in imposing the fine pursuant to Henry Heynick Construction. At the time of imposing the $10,000 fine in these circumstances, the court was well aware that the surcharge would add an additional $2,500 onto the total amount payable.

[28] The fact that financial hardship is a common circumstance for offenders convicted of owning a motor vehicle and driving it without insurance is not a reason to find that a surcharge is so "excessive as to outrage standards of decency".

[29] Regulatory offences often do not have specific victims. However, they are public welfare offences that govern activities in the public interest and in that regard, the surcharge serves a valid purpose.

[30] In conclusion, I do not find that the Victim Fine Surcharge in s. 60.1 amounts to cruel and unusual punishment. Therefore, the defendant's rights under s. 12 have not been breached in these circumstances.

Is There a Violation of Section 7?

[31] Section 7 of the Charter states that:

Everyone has the right to life, liberty and security of the person and the right not to be deprived thereof except in accordance with the principles of fundamental justice.

[32] A defendant alleging a violation of s. 7 must establish both a violation of the right to life, liberty or security of the person and that the deprivation of that right does not accord with the principles of fundamental justice: see R. v. Transport Robert (1973), [2003] O.J. No. 4306 (CA). Security of the person does not protect an individual from the ordinary stress and anxiety a reasonable person would experience as a result of government action or regulation: Transport Robert (1973).

[33] Risk of imprisonment can attract s. 7 security of the person interests. With respect to the enforcement of fines imposed by the court in POA matters (and thus the enforcement of the POA surcharge), there is no risk of imprisonment for non-payment of fines or fines that are in default. Pursuant to s. 68, there can be civil enforcement of fines that are in default. Default proceedings are set out in s. 69. However, pursuant to s. 165(3) if there is a transfer agreement between the Attorney General and a municipality, then the municipality has the power to collect and enforce fines levied, costs under s. 60 and surcharges under s. 60.1, but, the provisions found in s. 69(6)-(21) do not apply. Every municipality within the province of Ontario has such a transfer agreement such that all enforcement is done by the municipalities and thus there can never be warrants issued for default hearings or even default hearings within the province.

[34] The fact that someone's driver's licence can be suspended for nonpayment of fines also does not attract s. 7 security of the person interests since driving is a privilege and not a right.

[35] Unless some "security of the person" interest is identified as being applicable to s. 60.1, it is not necessary to consider any arguments or positions with respect to proportionality or arbitrariness. I can find no "security of the person" interest within s. 60.1. As a result, there is no violation of s. 7 of the Charter.

Conclusion

[36] In conclusion, I do not find that there has been a violation of the defendant's rights under s. 12 or s. 7. The defendant's application is dismissed.

Released: May 9, 2019

Signed: "Justice of the Peace Anna M. Hampson"