COURT OF APPEAL FOR ONTARIO

CITATION: R. v. Shearer, 2015 ONCA 355

DATE: 20150519

DOCKET: C59202

Macpherson, Blair and Huscroft JJ.A.

BETWEEN

Her Majesty the Queen

Appellant

and

Steven Craig Shearer

Respondent

Ghazala Zaman, for the appellant

Robin Parker, Duty Counsel

Mr. Shearer did not appear

Heard: May 12, 2015

On appeal from the sentence imposed by Justice M. O’Dea of the Ontario Court of Justice on April 1, 2014.

ENDORSEMENT

[1] Mr. Shearer was convicted of trafficking in a controlled substance known as hydromorphone, a highly potent narcotic pain killer. He was sentenced to 14 months’ imprisonment (less credit of 7.5 months for pre-trial custody), but it is ancillary matters relating to the $200 victim surcharge fine that was imposed and the sum of $170 in cash seized on his arrest, that form the subject matter of the appeal.

[2] The police were suspicious that the premises where Mr. Shearer was ultimately arrested were a site for dealing in hydromorphone. An undercover officer attended at the premises and purchased a quantity of the drug with $20 in marked bills. The house was then raided and Mr. Shearer was arrested. At the same time, the police found and seized a number of hydromorphone pills, a syringe filled with hydromorphone, other drug-related paraphernalia, and $170 in cash (including the marked $20).

[3] As a result of his conviction, Mr. Shearer was required to pay a victim surcharge under s. 737(1) of the Criminal Code. The offender’s obligation to pay the victim surcharge is mandatory and not subject to the court’s discretion. In the circumstances here – no fine imposed, and a conviction for an offence punishable by indictment – the victim surcharge is $200.

[4] At the conclusion of his reasons for conviction and sentence, the trial judge dealt with the victim surcharge in this way:

Victim Fine Surcharge will levy and one month to pay is granted.

The Crown is ordered to pay the Victim Fine Surcharge out of the cash money seized within 30 days of this date upon which the balance is forfeit to the Crown.

The Victim Surcharge Issue

[5] On behalf of the Crown, Ms. Zaman submits that the trial judge imposed an illegal sentence by ordering the Crown to pay the victim surcharge, and to do so out of the monies seized. We agree.

[6] A court cannot order a victim surcharge to be paid out of funds forfeited to the Crown as proceeds of crime. It is clear from the language of s. 737(1) that it is the offender’s obligation to pay the surcharge. Funds forfeited to the Crown as proceeds of crime no longer belong to the offender. To hold otherwise would be to defeat both the intended effect of the victim surcharge provisions (I.e., to make the offender pay into a fund to assist victims of crime) and the purpose of the forfeiture provisions in the Criminal Code (i.e., to deprive criminals of their ill-gotten gains, not to enable them to leverage those gains to offset another obligation to the state).

[7] A review of the transcript suggests that the trial judge’s goal may simply have been to ensure that in this case the victim surcharge made its way to the victims’ assistance pool, on the theory that a bird in the hand is worth two in the bush – i.e., that if ordered to pay directly, Mr. Shearer may fail to do so and the forfeited funds would go to other uses by the Crown. However, commendable this goal may have been, the trial judge in our respectful view did not have the authority to make the order he did regarding the manner in which the victim surcharge was to be paid.

The Forfeiture Order

[8] Ms. Zaman argues as well that the trial judge clearly intended to order the seized monies to be forfeited to the Crown, but that he failed to do so specifically and that this error should be corrected too. This brings us to Ms. Parker’s main concern on behalf of the defence.

[9] Ms. Parker’s submissions focussed on the forfeiture order relating to that portion of the seized monies exceeding the $20 “buy money”, if indeed such an order were made. She concedes that the $20 is caught by subsection 462.37(1) of the Criminal Code which provides for a forfeiture order where it has been established on a balance of probabilities “that any property is the proceeds of crime and that the designated offence was committed in relation to that property” (emphasis added).

[10] Here, the designated offence for which Mr. Shearer was convicted did not relate to the $150 balance of the monies seized; it related only to the $20 “buy money”. Accordingly, Ms. Parker submits, if the balance of the funds are to be ordered forfeited to the Crown, the order must be made under the more general provisions of subsection 462.37(2) dealing with the proceeds of crime derived from other offences. Under that provision, which is discretionary, the court must be “satisfied, beyond a reasonable doubt, that the property is proceeds of crime.” She submits that the trial judge made no findings in this respect, that the record did not support such a finding here, and that the trial judge erred by reversing the onus and requiring the offender to show that the monies seized were not proceeds of crime.

[11] We agree with these submissions as well.

[12] There was little, if any, evidence concerning the source of the additional $150 in question other than the natural suspicions that arise from the presence of the other items and paraphernalia that were seized. However, there were other submissions as well, namely that Mr. Shearer’s girlfriend had just received a baby bonus payment that day and the monies could have come from that source. Section 462.37(2) sets a high threshold – satisfaction beyond a reasonable doubt – where the property in question is said to constitute the proceeds of crime from offences other than the offence for which the offender is convicted and courts. Courts must be careful to ensure that threshold has been met before such an order is made. Here, in the absence of any findings by the trial judge, we cannot say we are satisfied on this record that it was.

[13] We note as well that the forfeiture order is made on the application of the Attorney General. We see no basis for concluding that the onus is on the offender to establish that the property is not the proceeds of other crimes. Yet it appears that is what the trial judge did. In response to a submission by Mr. Shearer’s counsel that “there’s nothing to indicate that [the seized monies] flowed from trafficking in drugs”, the trial judge said: “Nor is there anything to indicate that it wasn’t. I can’t accept that submission today.” Respectfully, this reversed the onus.

Disposition

[14] In the result, the order directing the Crown to pay the victim surcharge out of the monies seized upon Mr. Shearer’s arrest is set aside. In its stead, there will be an order requiring Mr. Shearer to pay a victim surcharge of $200 in accordance with s. 737 of the Criminal Code.

[15] The $20 in “buy money” seized is forfeited to the Crown pursuant to s. 462.37(1). The remaining $150 of the seized monies is to be returned to Mr. Shearer.

“J.C. MacPherson J.A.”

“R. A. Blair J.A.”

“Grant Huscroft J.A.”