CITATION: R. v. Henderson, 2007 ONCA 174

DATE: 20070315

DOCKET: C44170 & C44583

COURT OF APPEAL FOR ONTARIO

RE:

HER MAJESTY THE QUEEN (Respondent) – and – WILLIAM HENDERSON (Appellant)

BEFORE:

BLAIR, LANG and MACFARLAND JJ.A.

COUNSEL:

Rick Visca

for the appellant

Stephen F. Gehl

for the respondent

HEARD & RELEASED ORALLY:

March 9, 2006

On appeal from the conviction dated September 16, 2002, and the sentence dated September 2, 2005, imposed by Justice P.B. Hambly of the Superior Court of Justice sitting with a jury.

E N D O R S E M E N T

[1] The appellant seeks to set aside his conviction on 249 counts of fraudulently obtaining and attempting to obtain Goods and Services Tax (GST) refunds through a scheme that involved more than $1.5 million. He alleges that he requested disclosure from the Crown to assist with his alibi at trial but the evidence was unavailable. He therefore submits that the trial judge erred in failing to instruct the jury that the Crown was under an obligation to preserve evidence and the defence could not be faulted for not gaining access to the evidence before it was destroyed (the “Bero” error: see R .v Bero (2000), 2000 ONCA 16956, 151 C.C.C. (3d) 545 (Ont. C.A.). He now seeks to introduce fresh evidence (his employment records) which he claims support his alibi defence. In his Notice of Appeal, the appellant asserted that the verdict was unreasonable and that the trial judge erred in failing to give an adequate Vetrovec warning in relation to the Crown’s principle witness, the appellant’s father, William Henderson Sr., but he abandoned these grounds in oral argument. Separately, the Crown is appealing the sentence of eighteen months in custody, submitting that the appropriate sentence is four years.

[2] Mr. Henderson was an auditor for Revenue Canada. As such he had access to Revenue Canada’s GST accounts. Each auditor has a unique user ID and password. The evidence at trial was that the accounts were accessed in relation to fraudulently established farm accounts via the appellant’s user ID and password on many occasions. Farmers do not pay GST on purchases relating to their farming businesses, and accordingly are entitled to rebates on the tax they pay.

[3] It was the Crown’s original theory, when the case commenced, that the appellant and his father conspired together to claim the false credits. During trial the theory was expanded to include the existence of an inside co-worker acting as an accomplice to the appellant.

[4] Henderson Sr. had pleaded guilty, and been sentenced, prior to the appellant’s trial, and gave evidence against the appellant at trial. A co-worker of the appellant also testified that the appellant had discussed a similar scheme with her late in 1998, although he had subsequently told her he was joking, and that he confessed to her about the criminal activity afterwards. In addition, a search of the basement of the appellant’s house revealed documents and computer disks related to the scheme (which he said had been placed there by his father). Letters written to advance the scheme were created on the appellant’s home computer.

[5] The appellant’s defence was in the nature of an alibi (of which the Crown was advised only a week before trial). He said that he could only access the Revenue Canada accounts from his computer at the office (which was not contested) and that he was away from the office on the days when the fraudulent accessing was alleged to have occurred. He said that someone working with him could easily have discovered his password (notwithstanding he had changed it at least three times during the period over which the fraud occurred), for instance by looking over his shoulder. Essentially, his defence was that some other person inside the Revenue Canada office had stolen his user ID and password and used them to assist Henderson Sr. in committing the crime.

[6] In support of that defence he produced a travel expense voucher showing that he was away from the office on at least two of the days in question and he maintained that he was offsite doing an audit (‘the Saugeen audit”) in the town of Durham on several other occasions. He argued vigorously through cross-examination of the Crown witnesses, and through his counsel’s address to the jury, that he was precluded from cementing the validity of this defence because the Crown had destroyed, and was unable to produce, his employment records that would confirm his story. The trial judge told the jury that the travel voucher created an “irresistible inference” that the appellant had been away from his office on those occasions.

[7] The lost evidence was the subject of a pre-trial motion to stay (subsequently withdrawn) and a post-conviction motion for a stay. The trial judge allowed the post-conviction motion but did not grant a stay; instead he declared a mistrial. The Crown appealed this decision to this Court, which set aside the order for a mistrial on the grounds that once the jury’s verdict was delivered and recorded the trial judge had no jurisdiction to order a mistrial. It sent the matter back for sentencing.

THE CONVICTION APPEAL

The Fresh Evidence Application

[8] The lost documentation forms the primary basis for the fresh evidence application before us. During the various post conviction proceedings the Crown has produced, as part of its ongoing disclosure obligations, documentation that confirms the Saugeen audit actually took place, and a further document – created post-conviction – that outlines hours worked by the appellant during the relevant periods. The appellant says the former documentation would have enabled him to deflect the Crown’s attack at trial on the legitimacy of the travel expense voucher, and that the latter document demonstrates that he was working on a compressed work schedule and was not in the office on a number of Fridays on which the fraudulent accounts were accessed from his computer. He also says that the latter document has refreshed his memory and that he was at the doctors on another such date in the morning and with his mother in the afternoon. He is now able to produce medical evidence of the visit to the doctor.

[9] In our view, none of the proposed fresh evidence meets the Palmer criteria for admission. Much of it would have been available at trial if pursued with due diligence and in any event none of it would have had an impact on the jury’s verdict, in our view.

[10] Only three documents were produced following the conviction: (a) the computer print out reconstructing the appellant’s work schedule mentioned above; (b) documentation confirming the existence of the Saugeen audit; and (c) Revenue Canada’s internal investigation report that indicated there were discrete instances where other Revenue Canada employees (including his friend and co-worker) accessed the accounts in question.

[11] However, the compressed work schedule does not assist the appellant because it does not establish his absence on specific days. Whether he was in fact absent on those days is dependent upon his personal testimony to that effect, something that it was open to him to say at trial. Similarly the investigation report would not have assisted the appellant. He already had disclosure of all access dates to the fraudulent accounts and he could well have followed up on them with the Crown. In particular, he would have recognized that the February 11, 1998 access – which turned out to be by his friend and co-worker, John Beda – took place well after he had left Revenue Canada. He had in his possession a copy of an interview with John Beda, prior to trial, and an easy follow up request for information respecting the access on that date would have revealed the Beda access. Both of these documents fail on the due diligence Palmer criterion.

[12] The medical record produced is not dispositive either. The fresh evidence shows that the appellant’s computer was accessed many times during the afternoon of that date, January 30, 1996, and his story that he was with his mother that afternoon – recalled ten years after the event – is evidence that could well have been provided at trial.

[13] At the end of the day, the only persuasive documentary evidence in support of the appellant’s defence that he was absent on certain of the access days in question was the travel expense voucher respecting the Saugeen audit. This document was before the jury, however, and as noted above the trial judge gave a strong instruction that it created an “irresistible inference” that the appellant was absent on those dates. Accordingly, documentation confirming the actual existence of the Saugeen audit would have added little to the appellant’s defence at trial.

The Bero Ground

[14] We would not give effect to the argument that the trial judge failed to instruct the jury that the Crown had a duty to preserve documentation and that it was not the fault of the appellant that the documentation respecting his employment records and the template regarding the increased threshold had been destroyed or could not be found: R v. Bero, supra.

[15] The employment records were purged pursuant to Revenue Canada’s reasonable internal document retention policy, an explanation that was before the jury. The unavailability of these documents, and the absence of the template, were front and centre in the appellant’s defence and well known to the jury. At trial the appellant chose to utilize this absence as a basis for creating a reasonable doubt concerning his absences from the office, rather than asserting a failure to disclose on the part of the Crown as a ground for a stay.

[16] The appellant raises no allegation of ineffective assistance of counsel. It appears to us that the treatment of the missing documents was a tactical decision made by the defence at trial. No Bero charge was requested.

[17] In the end, we are not persuaded that the absence of such a charge, even if applicable, would have led to a different verdict from the jury. There was ample evidence upon which the appellant’s conviction could be based.

[18] The appeal as to conviction is therefore dismissed.

THE SENTENCE APPEAL

[19] In our view, while a sentence imposed was undoubtedly at the extreme low end of the range for this type of offence, there were many circumstances particular to this case both in terms of how the fraud was perpetrated and in the trial judge’s findings on sentence about the extent of the respondent’s role in the crime.

[20] The trial judge gave deliberate, careful and extensive consideration to the factual underpinnings of the conviction in terms of the respondent’s role, as he was obliged to do. While we may not have taken the same view of the evidence, and we are unsure the jury did either, the trial judge was entitled to his assessment of the jury’s verdict. In the absence of palpable and overriding factual error or error in principle we are obliged to approach the appeal on the basis of the trial judge’s perspective of the respondent’s role. On that basis we see no reason to interfere with the sentence imposed.

[21] The appeal is therefore dismissed.

“R.A. Blair J.A.”

“S.E. Lang J.A.”

“J. MacFarland J.A.”```