ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: 3431/09
DATE: 20121002
BETWEE N:
HER MAJESTY THE QUEEN
Xenia Proestos, for the Crown
Applicant
- and -
THOMAS DAVIS, DEBORAH DIECKMANN AND GEORGE SALMON
Adam Bernstein, for the Respondent Davis
Devin Bains, for the Respondent Dieckmann
Edmond Brown, for the Respondent Salmon
Respondents
HEARD: August 13 and 17, 2012
RULING
Baltman J.
[ 1 ] This application concerns whether previous rulings made by a trial judge who recused himself for a reasonable apprehension of bias are binding, or whether I, as the new trial judge, can proceed based on those rulings.
Factual Background
[ 2 ] The accused are charged with fraud. The Crown alleges they engaged in a scheme to defraud the government of $5.7 million in source deductions of income taxes, CPP contributions and EI premiums. The scheme purportedly involved the accused carrying on a seemingly legitimate business providing payroll services to various employers. However, instead of remitting amounts collected to Canada Revenue Agency (CRA), the Crown maintains they converted them to their own use.
[ 3 ] This is a complex case, with a long and unusual history. The charges were laid in August 2006. The preliminary inquiry began on January 5, 2009 and ended on May 14, 2009. Following four weeks of pre-trial motions, the trial began before Corbett J. and a jury on March 24, 2011. It ended in a mistrial in April 2011, when Corbett J. recused himself based on a reasonable apprehension of bias. This was prompted by Corbett J.’s discovery, in the midst of the trial, that a personal issue with CRA which he previously believed to be resolved was in fact still being challenged by CRA.
[ 4 ] Following Corbett J.’s recusal the Crown applied to have the trial continue before another judge under s. 669.2 of the Criminal Code . Sproat J. declined that application on April 28, 2011. The defendant Dieckmann then brought two motions: 1) a third-party records application seeking Justice Corbett’s personal income tax records and correspondence with his own counsel (accompanied by a subpoena for Justice Corbett); and 2) an application for a stay of proceedings under s.11(b) of the Charter . Both applications were dismissed by Reilly J. and the subpoena was quashed.
[ 5 ] The new trial is scheduled to proceed before me, with a jury, on March 18, 2013, and expected to last for approximately six months. It will be preceded by four weeks of pre-trial motions which begin on January 8, 2013.
[ 6 ] The case has been complicated and prolonged by several factors, including:
• a multitude of defendants : there were originally six co-accused; two have pled guilty, and one passed away;
• securing representation for the accused : at various points some had not retained counsel or changed counsel, or their counsel of choice was not available for prolonged periods;
• extensive paper and electronic disclosure : this included over 100 banker’s boxes (seized pursuant to 10 search warrants), followed by two different software programs and training on their use;
[ 7 ] Capping off this list is the recusal of the trial judge on April 18, 2011. By that point Corbett J. had issued two key rulings, which are the subject of this motion:
On November 18, 2010, he ruled that as part of its application to set aside solicitor-client privilege the Crown was within its rights to obtain documents from the solicitor’s office by way of subpoena, and did not require a search warrant (the “subpoena” motion). In support of that ruling he released partial reasons, but stated that given the significance of the procedural issue and the fact that he was taking a different approach than that taken by Trotter J. in R. v. V.I. (2008) 2008 36164 (ON SC) , 235 C.C.C. (3d) 57, he “must deal with it in some considerable detail in written reasons which will follow in due course”.
On March 8, 2011, he dismissed a s. 8 “ Jarvis” application (alleging the CRA abused its audit powers for the purpose of conducting a criminal investigation) without hearing it on the merits, on the basis that despite two adjournments provided for the defence to refine and particularize the pleadings, the application remained “a broad-based fishing expedition with no reasonable prospect of success” (the “Jarvis” motion). He advised his reasons would be provided later, in writing.
[ 8 ] It was not until April 7, 2011, i.e. over a month after he released the Jarvis ruling, that Corbett J. learned, to his surprise, that CRA did not consider their previous dispute to be settled. At that point he had not delivered any further reasons on either the “subpoena” or the “Jarvis” issue.
The issue and the parties’ positions
[ 9 ] The question before me is: once a reasonable apprehension of bias has arisen, are all previous orders, regardless of their correctness, rendered void?
[ 10 ] The Crown argues there are two bases upon which I should prohibit the respondents from re-litigating issues already decided by Corbett J.: a) s. 653.1 of the Criminal Code , which proves that evidentiary rulings made at a previous trial are binding at a re-trial “unless the court is satisfied that it would not be in the interests of justice”, and b) Rule 34.02 of the Criminal Proceedings Rules, which confers discretion on the Court to dismiss an application “if satisfied that there is no reasonable prospect that the application could succeed.”
[ 11 ] The defence also rests on primarily two arguments, namely a) once a trial is concluded because of a reasonable apprehension of bias, all previous rulings, regardless of their apparent merit, become tainted and must be re-litigated; consequently, it cannot be “in the interests of justice” to uphold the previous rulings in this case; b) the absence of reasons from Corbett J. in support of his rulings prevent appellate review, creating unfairness to the defendants.
Analysis
[ 12 ] At the outset I agree with the defence that the Crown’s argument pursuant to Rule 34.02 is premature; the thrust of this motion is to determine whether previous rulings by Corbett J. must be re-litigated pursuant to s. 653.1 , and should be confined to that. Should the defence succeed on this motion, the Crown can then revive its alternative position that both applications should be dismissed at the outset as lacking any merit.
[ 13 ] That leaves the argument focused on s. 653.1 , and in particular whether “the interests of justice” require re-litigation in this case. The section states:
In the case of a mistrial, unless the court is satisfied that it would not be in the interests of justice, rulings relating to the disclosure or admissibility of evidence or the Canadian Charter of Rights and Freedoms that were made during the trial are binding on the parties in any new trial if the rulings are made – or could have been made – before the stage at which the evidence on the merits is presented.
[ 14 ] That section was proclaimed in force on August 15, 2011, and marks a departure from previous jurisprudence from the Supreme Court of Canada to the effect that a trial judge is not bound by interlocutory rulings made at an earlier trial, even if a higher court finds no error with the ruling: R. v. Duhamel, 1984 126 (SCC) , [1984] 2 S.C.R. 555
[ 15 ] To date there has not been any jurisprudence interpreting s. 653.1 , and in particular what the phrase “interests of justice” means in this context. However, the identical wording is used throughout the Criminal Code and has been analyzed extensively. Based on a review of those cases I derive the following guidance in interpreting the phrase:
• The phrase “interests of justice” takes its meaning from the context in which it is used and signals the existence of a judicial discretion to be exercised on a case-by-case basis. The interests of justice encompass broad based societal concerns and the more specific interests of a particular accused, including meaningful access to appellate review: R. v. Bernardo , [1977] O.J. 5091 (C.A.) at paras. 16 and 19 ;
• The expression takes into consideration both the interests of the accused as well as the state: R. v. Beaulac, 1999 684 (SCC) , [1999] 1 S.C.R. 768
• The interests of justice also encompass the integrity of the criminal process, which includes bringing finality to litigation and avoiding the time and expense inherent in the re-litigation of issues: R. v. M. (P.S.) (1992), 1992 2785 (ON CA) , 77 C.C.C. (3d) 402 at p. 411; R. v. Owen, 2003 SCC 33 () , [2003] S.C.J. No. 31, para. 52 ; R. v. Last, 2009 SCC 45 () , [2009] S.C.J. No. 45, para. 16
[ 16 ] Section 653.1 is clearly intended to encourage the retention of prior rulings, in order to avoid the time, expense and risk of conflicting decisions associated with re-litigation. The wording of the section - “unless the court is satisfied…[previous rulings] are binding” – indicates there is a presumption in favour of preserving rulings made at the earlier trial. The presumption is only defeated if in the particular circumstances of the case, the court is satisfied that it would not be in the interests of justice to proceed based on the previous rulings.
[ 17 ] With those general guidelines in place, the issue then is whether an apprehension of bias mid-trial should displace previous rulings by the trial judge. Despite Mr. Bains’ insistence to the contrary, there is no case law precisely on point. [1] The case that he primarily relies upon, R. v. R.D.S., 1997 324 (SCC) , [1997] 3 S.C.R. 484, addressed a very different scenario. There the court was considering whether oral reasons by the trial judge making reference to the racial dynamic in the case before her created a reasonable apprehension of bias. In the course of concluding no such concern arose in that case, Cory J. commented on the general standard to be applied (para. 100):
If a reasonable apprehension of bias arises, it colours the entire trial proceedings and it cannot be cured by the correctness of the subsequent decision …Thus, the mere fact that the judge appears to make proper findings of credibility on certain issues or comes to the correct result cannot alleviate the effects of a reasonable apprehension of bias arising from other words or conduct of the judge. [emphasis added]
[ 18 ] Justice Cory’s point appears to be that if the trial judge’s findings, at the time they were made , were tainted by bias, they are not entitled to appellate deference, irrespective of the soundness of any subsequent decisions. He did not comment on what the outcome might be should the perceived bias arise after the rulings in issue were made. That specific question was not raised in that case, likely because the allegation there concerned racial bias by the trial judge, an attitude which, if it existed, likely tainted the entire proceeding and did not suddenly arise part way through.
[ 19 ] The defence also relies upon R. v. Curragh Inc., 1977 20 (SCC) , [1977] S.C.J. No. 33, where the trial judge sought to have Crown counsel removed from the case, and later allowed the accused’s motion for a stay of proceedings on manslaughter charges because of the Crown’s failure to disclose relevant evidence. A majority of the Supreme Court agreed with the Nova Scotia Court of Appeal that the trial judge’s conduct created a reasonable apprehension of bias, and therefore a new trial was required:
The right to a trial before an impartial judge is of fundamental importance to our system of justice…when a court of appeal determines that the trial judge was biased or demonstrated a reasonable apprehension of bias , that finding retroactively renders all the decisions and orders made during the trial void and without effect.
[paras 7-8, emphasis added]
[ 20 ] Curragh is also a far different factual scenario than the one before me. In that case the trial judge made it known throughout the trial that he was deeply troubled by the Crown’s alleged failure to disclose. Part way through the trial he telephoned the acting director of the public prosecution service and complained about how the lead crown attorney had been conducting the case. The trial judge went on to advise that if the crown attorney was not removed from the case, the trial judge would take steps to attain that end.
[ 21 ] Thus, like R.D.S. , Curragh involves a situation where the apprehended bias arguably permeated the entire trial, logically requiring that all previous orders must be revisited.
[ 22 ] I would add that both R.D.S. and Curragh were decided long before the enactment of s. 653.1 . Rather than imposing a presumption of issue estoppel or res judicata, the new provision promotes the retention of prior rulings unless a careful balancing of the competing interests requires otherwise. This reflects the tremendous cost, delay and inconvenience of rehearing motions, particularly in overburdened jurisdictions such as the Central West region of Ontario.
[ 23 ] In the Crown’s view, there should not be any concern here that Corbett J.’s prior rulings were influenced by his conflict with CRA, as they were issued before he learned that his earlier dispute with CRA remained, from the agency’s perspective, unresolved. The Crown emphasizes there was no evidence of actual bias; at the most, there was an apprehension of bias were Corbett J. to have continued with the trial. But for two factors – one probably surmountable, the other more delicate - that argument would be very compelling.
[ 24 ] The first problem concerns the absence of reasons. “Absence” may not be a fair word here, as on the subpoena issue Corbett J. in fact gave meaningful oral reasons, which resulted in ten pages of transcript. Those reasons, in a careful and articulate fashion, reviewed the relevant history, identified the issue and the competing positions of the parties, and then analyzed the relevant case law, in particular the two leading cases on the issue: R. v. V.I. and R. v. Lavallee, 2002 SCC 61 () , [2002] 3 S.C.R. 209. Importantly, Corbett J. then explained in some detail why , in his view, Lavallee does not preclude use of a subpoena to obtain documents from a lawyer’s office and identified the advantages of a subpoena over a search warrant. He then concluded his reasons with a six point full page summary of his findings.
[ 25 ] I appreciate that in concluding that V.I. is incorrect and ought not to be followed, Corbett J. found the issue to be significant enough that it warranted written reasons to follow “in some considerable detail” on that point. But I do not see the absence of those additional reasons to be fatal to appellate review in this case. While Corbett J.’s insights on why V.I. should not be followed would no doubt be edifying, he was not bound by V.I. , as he was by Lavallee. In any case, his reasons, had they been given, would not relate to one of those tasks that falls squarely within the trial judge’s arena, and to which appellate courts traditionally show great deference, such as credibility assessments or factual findings. It would be a pure legal analysis, something which appellate courts are not only ideally suited for but which of course result in interpretations that bind all lower court judges. The trial judge’s legal analysis may be of interest or even highly persuasive to the Court of Appeal, but it is not determinative. It is for that reason that the standard of review on issues of law is correctness, not reasonableness.
[ 26 ] Nor do I see the absence of reasons on the Jarvis issue to be fatal. In R. v. Sheppard , 2002 SCC 26 () , [2002] S.C.J. No. 30, paras 42-55 , the Supreme Court made it clear that the duty to give reasons arises out of the circumstances of a particular case. If the basis for the decision is clear from the record, the functional need to know has been met:
Where it is plain from the record why an accused has been convicted or acquitted, and the absence or inadequacy of reasons provides no significant impediment to the exercise of the right of appeal, the appeal court will not on that account intervene.
[ 27 ] In this case I agree with the Crown that the record speaks for itself. In fact “the record” – or lack thereof - was the very problem the court faced. The Crown’s application was procedural, not merit based, and arose from the defendants’ failure - despite repeated exhortations from the bench – to properly particularize and frame the issues. Although Corbett J. advised his reasons would follow, he did give a brief explanation, approximately one page in length, to the effect that the pleadings were “still” grossly inadequate. All the allegedly defective materials which drove Corbett J. to that conclusion are available for appellate review. Again, while his articulation of the problem might have been helpful to the defence in mounting an appeal, in this case, with or without the specifics, both the defendants and the Court of Appeal could proceed based solely on the record to assess the merits of an appeal and the trial judge’s conclusion that “it’s not a fishing expedition, it’s a whaling expedition.”
[ 28 ] For those reasons, while the lack of reasons arguably creates some disadvantage for the defendants, in my view it does not, on its own, merit a repeat of four weeks of pre-trial motions.
[ 29 ] The second problem, however, is thornier. It concerns the specific comments made by Corbett J. when he initially declared his conflict to counsel. Justice Corbett first notified counsel of the problem on April 12, 2011, when he called them into his chambers, with a reporter present. The relevant portion of his comments follow:
Counsel, a matter came to my attention last Thursday that puts me in a position where I believe I will have to recuse myself from this trial. I will explain this to you briefly.
I have a dispute with CRA regarding my personal tax issues. I understood the matter was settled last fall, and last Thursday I learned, for the first time, that CRA does not consider it so. This places me in a position of being an antagonist with one of the participants in this proceeding.
The primary issues in this trial concern the accused, and whether they have fraudulently diverted source deductions, and obviously my personal tax matters have nothing whatsoever to do with that.
However, the accused have raised issues concerning the conduct of CRA. I have already dismissed the Jarvis application without holding a voir dire . My written reasons for that ruling have not been completed or released.
There is a pending application concerning CRA’s alleged failure to respect solicitor/client privilege in the searches and seizures pursuant to the warrants, and I infer from certain lines of questioning from defence counsel that there may be further issues relating to the alleged conduct of CRA in its investigation. At the least I expect that I shall be called on to comment on this evidence and its significance or potentially its irrelevance in my final instructions to the jury.
In this context, given these issues, I conclude that a reasonable person apprised of all the circumstances could be concerned about whether I had a negative animus towards CRA and whether any of my rulings were influenced by it.
Alternatively, the same reasonable person could be concerned that I wished to curry favour with CRA to assist me in the resolution of my own dispute, and that perhaps my rulings were influenced by that . This strikes me as squarely within the ambit of where reasonable apprehension of bias could arise.
There is no bias, in fact. The issue is whether there would be a reasonable apprehension of bias, and that a reasonable observer could have concerns about whether my decisions were motivated, perhaps unconsciously, by these extraneous considerations.
[emphasis added]
[ 30 ] The message is somewhat unclear; on the one hand, Corbett J. indicates clearly that he only learned recently that his problem with CRA was not fully resolved, contrary to his previous understanding. On the other hand, he raises the prospect that a reasonable person might nonetheless conclude that rulings that he made before that discovery “were influenced” by that conflict. It may be that Corbett’s J.’s concern related solely to rulings he anticipated having to make in the future, rather than what he had already decided, but the reference to rulings generally (“any of my rulings”) and the use of language in the past tense (“were influenced”) muddles the issue somewhat. At the very least, it is open to the interpretation that Corbett J. himself related the apprehension of bias in part to his previous rulings on the pre-trial motions. If the judge who is recusing for bias seems himself to be of the view that his pre-trial rulings may appear tainted, that in my view ends the matter. It would not be in the “interests of justice” for those rulings to stand.
[ 31 ] I arrive at this conclusion with some reluctance, and certainly with great skepticism that - despite their insistence that this is a matter of principle - the defendants would be urging this result had Corbett J.’s rulings been in their favour. I am also very cognizant of the Crown’s concern that the motions in question remain undefined in scope and length, and cannot realistically be completed in the four weeks set aside for that purpose in January 2013. Defence counsel insists four weeks provides ample time. For that reason I called upon defence counsel to confer with the Crown and then commit to a schedule in which all pre-trial motions – including the ones at issue in this motion – would be completed within the four weeks set aside in January 2013. That they have done, and they are on notice that they will be held strictly to the schedule: barring the most extraordinary circumstances, the pending motions cannot be expanded beyond the boundaries defined before me on this motion, nor will any further pre-trial motions be entertained.
[ 32 ] In conclusion, in the unique and unfortunate circumstances of this case, I find the interests of justice require re-litigation of the two motions in issue. The Crown’s application is therefore dismissed.
Baltman J.
Released: October 2, 2012
COURT FILE NO .: 3431/09
DATE: 20121002
ONTARIO SUPERIOR COURT OF JUSTICE B E T W E E N: HER MAJESTY THE QUEEN - and – THOMAS DAVIS, DEBORAH DIECKMANN AND GEORGE SALMON
RULING
BALTMAN J.
Released: October 2, 2012
[^1]: A brief review of the state of the law before the enactment of s. 653.1 can be found in an article by Don Macdougall entitled “Continuity of Judicial Rulings After a Mistrial”: (2003), 15 C.R. (6 th ) 273 -281