Court File and Parties

Citation: R. v. Tennina, 2008 ONCA 498 Date: 2008-06-23 Docket: C48043 Court of Appeal for Ontario

Before: Laskin, Rouleau and Epstein JJ.A.

Between:

Her Majesty the Queen (Respondent)

and

Doreen Tennina and 1517069 Ontario Inc. o/a Executive Accounting (Appellants)

Counsel: Rocco Galati for the appellants Kevin Wilson and Connie Zary for the respondent

Heard: June 19, 2008

On appeal from the judgment of Justice D.L. Corbett of the Superior Court of Justice dated November 29, 2007.

Endorsement

[1] The Canada Revenue Agency is conducting an investigation into tax fraud resulting from false statements made by the appellants, tax preparers, in roughly 5,000 tax returns. The amount of the fraud is estimated to be as high as $15 million. The investigation relies largely on more than fifty boxes of seized materials. The CRA obtained an initial order for retention of these materials under s. 490(1) of the Criminal Code as well as an order extending the detention pursuant to s. 490(2). A subsequent application for further retention was denied, however, essentially because the Justice of the Peace felt that CRA should have moved the investigation along more quickly.

[2] On an application for certiorari, Justice Corbett of the Superior Court quashed that decision on the basis that the Justice of the Peace had acted outside of his jurisdiction by failing to apply the correct test under s. 490(2).

[3] We substantially agree with the reasons of Corbett J. and, in our view, the appeal should be dismissed.

[4] In the present case, the Crown’s witness explained at some length the way that the investigation had proceeded and, more importantly, the continuing need to retain the seized materials. Central to that explanation was the fact that the number of clients of the appellants that had to be investigated had gone from 364, when the May 2007 application for an extension was filed, to 4,850 in July 2007 when the application for extension that is the subject of the appeal was filed.

[5] From the reasons of the Justice of the Peace, it is apparent that the focus of his inquiry was on the approach to the investigation taken by the Crown since the seizure as opposed to the criteria set out in s. 490(2) whereby he had to be satisfied that “having regard to the nature of the investigation, [the material’s] further detention for a specified period is warranted.” Where an extension is sought, some consideration of the conduct of the enquiry up to the date of the request for an extension is appropriate. The focus however, must remain on the needs of the ongoing investigation.

[6] As set out by Corbett J., s. 490(2) does not “call on the courts to usurp investigatorial and prosecuterial discretion, but rather to ensure that the property rights of individuals are fairly balanced against the legitimate needs of ongoing investigations.” By failing to apply the correct test, the Justice of the Peace exceeded his jurisdiction and on this basis, we agree that Corbett J. properly quashed that decision.

[7] For these reasons we dismiss the appeal.

“John Laskin J.A.”

“Paul Rouleau J.A.”

“G. Epstein J.A.”