R. v. Chernysh, 2016 ONSC 6716

Citation: R. v. Chernysh, 2016 ONSC 6716 Court File No.: CR-15-50000458-0000 Date: 2016-10-28 Ontario Superior Court of Justice

Between: Her Majesty the Queen – and – Dmytro Chernysh, Applicant

Counsel: Aaron Del Rizzo, for the Respondent Peter Thorning and Deepa Negandhi, for the Applicant

Heard: October 17, 18 and 19, 2016

Before: Low J. (Orally)

Reasons for Judgment

[1] The applicant, Dmytro Chernysh, is charged under s. 342(3)(a) of the Criminal Code with possession of forged or falsified credit cards, under s. 402.2(5)(a) with possession of identity information in circumstances giving rise to a reasonable inference that the information was intended to be used to commit an indictable offence and under s. 163.1(4)(a) with possession of child pornography.

[2] The applicant seeks an order pursuant to s. 8 and s. 24(2) of the Canadian Charter of Rights and Freedoms excluding from evidence the products of execution of a search warrant issued at Toronto on November 14, 2013. The products of the search comprise a laptop computer, 3 USB drives, 2 external hard drives, 65 plastic cards with magnetic strips, a credit card reader and a folder containing 34 images of child pornography. The applicant seeks also to exclude from evidence utterances he made at the time of arrest on November 14 and a number of credit card blanks found in a search of his wallet on the same day after his arrest. The search of the wallet was said to be incident to arrest.

[3] The grounds for the application are as follows:

(a) that there was no reasonable basis upon which the search warrant could have been issued based on the material in the information to obtain and, a fortiori, based on the information to obtain as amplified after receiving oral evidence on this application;

(b) that there were no reasonable grounds for the arrest of the applicant;

(c) that the arrest, which was warrantless, took place in the applicant`s home and was thus unlawful; and

(d) that the search of the applicant`s wallet was without a warrant and was not incidental to arrest and was thus unreasonable.

[4] The matter began at the Canada Border Services Agency ("CBSA") at the Vancouver International Mail Centre. A package originating in China which was unaccompanied by a declaration of contents and value came to the attention of a CBSA employee who opened the package for inspection. It was found to contain 10 cards which had the appearance of payment cards issued by 10 different Asian businesses. Nine bore the Mastercard logo and one the Visa logo. Upon examination by the CBSA staff, it was determined that none of the cards was encoded with information. There were no bearer`s names on the faces of the cards and there was no attempt to conceal the package contents.

[5] The addressee on the package was Dmytro Chernysh with an address of 2305 Lakeshore Boulevard West, Apartment 104 in Toronto. The sender`s name, address and telephone number are stamped on the face of the envelope in Chinese and in English.

[6] The Border Services employee was instructed by her supervisors that the CBSA had no power to seize the contents of the package and the matter was referred to the RCMP for investigation.

[7] Officer Satish Tarachandra of the RCMP detachment at Milton undertook the investigation. Officer Tarachandra is an experienced investigator in offences related to identity theft and falsified payment cards.

[8] On November 13, 2013 Officer Tarachandra swore an information in support of an application to the Justice of the Peace at Milton for a search warrant for the address of 2305 Lakeshore Boulevard West, Apartment 104. In the information to obtain, Officer Tarachandra cited three offences: trafficking in property obtained by crime (s. 355.2(a)), possession of trafficked credit cards (s. 342(1)(c)(i) and possession of property obtained by crime (s. 355.4(a)).

[9] The officer set out a description of the 10 cards intercepted by the CBSA including the fact that no data was encoded on the cards. He indicated that a Ministry of Transport search disclosed that a male, Dmytro Chernysh, with a birth date in 1985 had a driving licence issued with the same address as that shown on the intercepted package.

[10] The Information to Obtain ("ITO") disclosed that it was the intention of the police to effect a controlled delivery of the package to Dmytro Chernysh and to arrest him if he took receipt of the package. The controlled delivery was to be made by an undercover officer posing as a mail carrier.

[11] The Justice of the Peace at Milton declined to issue the search warrant, endorsing,

[T]he informant has not established a credibly based probability that a search of the subject premises will afford the specified evidence as to any of the offences alleged in the Information to Obtain. The narrative contains insufficient information to establish more than a mere suspicion that any of the specified evidence will be found.

[12] Officer Tarachandra did not seek an arrest warrant. Under cross-examination, he acknowledged that he did not have enough information to obtain an arrest warrant.

[13] Having been refused a search warrant and aware that he did not have sufficient information to support a warrant for arrest, Officer Tarachandra, with the assistance of undercover members of the Toronto Police Services, went ahead with the plan to make a controlled delivery and to arrest the applicant if he took receipt of the package. They did not apply for a general warrant.

[14] The controlled delivery was done at about 8:12 a.m. on November 14, 2013. Officer Rich Sidhu of the Toronto Police was assigned to make the delivery to Dmytro Chernysh. For this purpose he was attired as a mail carrier. There were four other officers involved in the controlled delivery, two of them at the north end of the corridor, and two at the south end.

[15] Officer Sidhu knocked on the applicant’s door. The applicant opened it wearing only undershorts. Officer Sidhu asked him if he was expecting a package to which the applicant answered “yes”. Officer Sidhu asked him if he was Dmytro Chernysh to which the applicant also replied “yes”. The officer then asked the applicant to produce some identification and the applicant went into the apartment to get it.

[16] According to Officer Sidhu’s evidence, the applicant then stepped out into the hall at which time the officer arrested him. This point is in contention. The applicant has deposed that he was arrested while he was at the door, but in his apartment. He was not cross-examined on this. Officer Sidhu’s own evidence at the preliminary inquiry conflicted with his evidence on the application. At the preliminary inquiry, Officer Sidhu agreed that the applicant was standing in his apartment in his underwear when he was arrested.

[17] Officer Entwhistle was one of the lookout officers for the controlled delivery. He was, according to his evidence, 20 or 30 feet away from the applicant’s apartment door when the delivery took place. He testified that he saw what he believed to be the arrest. He stated that he saw a motion and that it must have been at the doorway “because I couldn’t see into the apartment”. He acknowledged that he couldn’t say that the arrest was in the hall.

[18] Officer Ruhl, another of the lookout officers. testified that he could hear his fellow officer say “you’re under arrest” but when asked where the applicant was at arrest, he did not give a responsive answer. He testified only that he had to go past them to get into the unit.

[19] I find that the applicant was arrested in the apartment. I am not able to accept as reliable Officer Sidhu’s evidence that he made the arrest in the hall in light of his conflicting evidence at the preliminary inquiry and in light of the evidence of Officer Entwhistle, of Officer Ruhl and of the applicant himself although I appreciate that the applicant has an interest in a finding that the arrest took place within his home.

[20] The arrest took place in the applicant’s home and was without a warrant. I find nothing on the facts of the case that would justify an arrest without a warrant. There were no exigent circumstances. The applicant was standing wearing nothing but his undershorts just after 8 in the morning. There was no offence being committed. There was no reasonable basis for a belief that the applicant was about to commit an indictable offence.

[21] On November 13, 2013, it was known that the addressee of the package was Dmytro Chernysh. It was known that there was a person of that name who had been issued a driving licence with the same address as shown on the package. The inference that could be drawn was that the package was being sent to a real person, Dmytro Chernysh, who resided at the address and that the package would be in his physical possession once delivered.

[22] The fact that the physical person who presented himself at the apartment door identified himself as Dmytro Chernysh does no more than to confirm that he resided there and was the intended recipient of the package.

[23] There were no reasonable grounds for arrest on November 13, the date of the original application for a search warrant before the Justice of the Peace at Milton. Officer Tarachandra knew that it was not a criminal act for a person, without anything more, to have in his physical possession, blank payment cards. The acceptance by the applicant of delivery of the package on the morning of November 14 did not change or add to the facts such as could amount to reasonable grounds. The mere possession, without anything more, was not a criminal offence, and the officer did not have any evidence of anything more. Officer Tarachandra acknowledged that he knew it was not unlawful to possess blank payment cards.

[24] There was no evidence to constitute reasonable grounds to believe that any of the several offences cited in the unsuccessful application for a search warrant had been committed and I find that Officer Tarachandra so knew.

[25] In relation to the offences of possession and trafficking of property obtained by crime, the officer was asked in cross-examination to identify the crime by which the property, the cards, had been obtained. He was unable to do so.

[26] In relation to the offence of possession of credit cards forged or falsified knowing that it was obtained, made or altered by the commission in Canada of an offence, the officer was similarly unable to identify any offence. In addition, there was no evidence or suggestion that any of the cards was forged or falsified. The cards had no data encoded on them and no bearer names. They were either blanks, and thus capable of being made into payment cards by encoding, or they were what one might term “dummies”, that is, cards that are incapable of being made into payment cards.

[27] The officer was suspicious that that the recipient of the cards must be up to no good because, in his experience, persons who did falsify payment cards sometimes imported blanks from foreign sources and then encoded them in Canada with data belonging to real account holders and financial institutions. He cannot be faulted for having a suspicion. That is his job, but his suspicion and its basis bore no relation to any of the offences that he cited in both the unsuccessful application and in the successful application for a search warrant.

[28] The officer’s knowledge that it was not an offence merely to possess blank payment cards is not changed by the fact that the applicant acknowledged that he was the intended recipient of the cards.

[29] Both Officer Sidhu, who made the arrest, and Officer Tarachandra referred only to possession of property obtained by crime as the rationale for the arrest, but on the facts and circumstances disclosed, there were no objective grounds for arrest for that or for any of the offences cited by the affiant in the ITO.

[30] I find that Officer Tarachandra did not hold the subjective belief that there were such grounds. I make that finding on the basis that as an experienced officer and as a person with a law degree, he had to have known there were no grounds because first, he knew that mere possession of blank cards was not an offence and, second, he could not identify any crime by which the cards were obtained.

[31] As the Supreme Court stated in R. v. Storrey, [1990] 1 S.C.R. 241 at para 17,

… the Criminal Code requires that an arresting officer must subjectively have reasonable and probable grounds on which to base the arrest. These grounds must, in addition, be justifiable from an objective point of view. That is to say, a reasonable person placed in the position of the officer must be able to conclude that there were indeed reasonable and probable grounds for the arrest. On the other hand, the police need not demonstrate anything more than reasonable and probable grounds. Specifically they are not required to establish a prima facie case for conviction before making the arrest.

[32] I am mindful of the absence of a need to make out a prima facie case before reasonable grounds for an arrest can exist. On the other hand, a mere suspicion that the accused might at some time in the future do something unlawful with the property-- in this case, engage in falsifying payment cards-- is insufficient to support an arrest without a warrant. I find that a mere suspicion is what existed in the mind of Officer Tarachandra, but what is most troubling is that it was not a suspicion that an offence that had taken place; it was a suspicion that the applicant might commit an offence in the future. That is not a reasonable ground for arrest without a warrant.

[33] In argument, Crown counsel referred me to s. 342.01(1) of the Criminal Code. That section reads:

Every person is guilty of an indictable offence and liable to imprisonment for a term of not more than 10 years, or is guilty of an offence punishable on summary conviction, who, without lawful justification or excuse, makes, repairs, buys, sells, exports from Canada, imports into Canada or possesses any instrument, device, apparatus, material or thing that they know had been used or know is adapted or intended for use

(a) In the copying of credit card data for use in the commission of an offence under subsection 342(3); or

(b) In the forging or falsifying of credit cards.

[34] The suggestion is that the officers, although they were not cognizant of it, had reasonable grounds in relation to this offence such that the arrest could be supported after the fact.

[35] I am not able to accede to the argument.

[36] Neither Officer Tarachandra, the operating mind of the investigation, nor Officer Sidhu, the operating arm, had the intention to arrest for the offence in s. 342.01(1). Officer Sidhu was not alive to it and while Officer Tarachandra may have held the suspicion that the accused may have had an intention to use the cards in the prohibited way, he had no evidence of it, no evidence that the cards were capable of being adapted in the prohibited way and no evidence that the cards had been previously used in the prohibited way. Accordingly, the officer cannot be said to have held a subjective belief that there were reasonable grounds to arrest for infringing s. 342.01(1). On the objective level, I am of the view that the circumstances of mere possession of blank cards or dummy cards do not disclose reasonable grounds under that section. There needs, in my view, to be some evidence that the cards have some indicia of at least one of the prohibited characteristics set out in the offence.

[37] To compound the violation of the applicant’s right not to be arbitrarily detained under s. 9 of the Charter, the officers, in undertaking the undercover controlled delivery at the applicant’s home, violated the applicant’s s. 8 privacy rights. I find that the purpose of the delivery was not merely to deliver the package, but to obtain evidence against the applicant.

[38] The waiver of privacy in a person’s implied invitation to knock at his residence for communication is a limited one. It does not, in my view, extend to covert action by a police officer who, in the guise of something he is not, obtains engagement with the resident – not for the ostensible purpose indicated by his disguise – but for the oblique purpose of gathering evidence against him. (See R. v. Evans, [1996] 1 S.C.R. 8 at paras. 11 through 18).

[39] The applicant’s s. 8 and s. 9 rights were breached by the fact and by the manner of arrest in that there were no reasonable grounds for arrest and in that the arrest was warrantless, in the applicant’s residence and in the absence of any exigent circumstances or other justification. (see R. v. Feeney, [1997] 2 S.C.R. 13)

[40] According to the evidence of the officers, the need for a Feeney warrant was a matter with which they were familiar. It seems to me that either they are telling the truth, and that they chose to ignore the obligation to obtain a warrant, or they were not being frank, and that they were not alive to the issue. Given that Officer Tarachandra was aware that he did not have grounds to obtain a warrant on the previous day, it would seem to me that the first alternative is the more plausible because the applicant’s admission that he was Dmytro Chernysh and his acceptance of the package did not raise the totality of evidence to reasonable grounds for arrest let alone arrest without warrant in a residence.

[41] As the arrest was in breach of the applicant’s s. 8 and s. 9 rights, the utterances and the contents of the applicant’s wallet, said to have been obtained during a search incident to arrest, were obtained in breach of the applicant’s Charter rights.

[42] As it is my view that the arrest itself was in breach of the Charter, it is unnecessary to decide whether or not the search of the wallet was incident to arrest. I would note, however, that if the arrest took place at a time when the applicant was wearing nothing but his undershorts, any search incident to arrest would not likely involve a search of his wallet. If the search of the wallet was incident to arrest, the product of the search was not legitimately obtained because the arrest itself was unlawful.

[43] In considering whether the evidence should be excluded, I am of the view that the breaches that led to the arrest, the utterances and the product of the search of the wallet were serious breaches. They were not merely technical. The breaches were compound and were the product either of ignorance of or of disregard for the substantive law of the offence relied upon and of the state’s obligation to conduct investigations in accordance with Charter values.

[44] The impact on the applicant’s Charter protected interests is very significant. While not as traumatizing as it may have been had the door been broken down, the applicant’s privacy rights have been significantly breached. According to the arresting officer’s own evidence, the applicant was arrested while wearing only his undershorts. Given the time of day and the delay from the knock to the answering of the door, it was apparent that the applicant was roused from his bed and, as indicated above, I have found that the arrest took place in the home.

[45] Society has at all times an interest in seeing that cases are adjudicated on their merits, but given the severity of the breaches and the impact on the accused, I am of the view that admission of the evidence obtained on the arrest and on the search of the wallet would bring the administration of justice into disrepute. The evidence will therefore be excluded.

[46] I turn now to the product of the execution of the search warrant issued on November 14.

[47] It is the applicant’s position that the Justice of the Peace at Milton was correct in declining to issue a search warrant on November 13 and that there were no reasonable grounds for issuance of the search warrant on November 14, in particular, after certain material has been excised from the Information to Obtain upon which the warrant was issued. I agree.

[48] The additional facts that had come into existence between November 13 and 14 were actual receipt by the applicant of the package, his utterance, according to the undercover officer, “that’s for me”, and the discovery of multiple blank credit cards in the applicant’s wallet after he had been transported to 22 Division..

[49] As I have indicated above, the fact that the applicant acknowledged that he was the named addressee does not alter the landscape as far as presence or absence of reasonable grounds is concerned. The addressee’s name and address had already been confirmed the previous day. Possession of the cards per se was not an offence and was known by Officer Tarachandra not to be an offence.

[50] The finding of the blank credit cards in the applicant’s wallet were, however, the direct product of breaches of the applicant’s Charter rights under ss. 8 and 9. Reference to the product of the wallet search must therefore be excised from the November 14 Information to Obtain.

[51] Apart from the contents of the ITO emanating from the unlawful arrest and the breach of applicant’s privacy rights, the ITO presented to the Justice of the Peace at Toronto is problematic in several other respects.

[52] At paragraph 9 of the document, Officer Tarachandra deposes that “the Vancouver International Mail Center intercepted a package destined to a Dmytro Chemysh [sic] in Toronto that was found to contain what I believe to be 10 counterfeit credit and payment cards from multiple Asian countries.”

[53] The officer knew that the cards in the package were not encoded with data and had no bearer names. They were either blanks and capable of being encoded, or they were dummy cards that were not capable of being encoded. The officer had no information as to whether the cards were capable of being encoded. As well, he had no information whether or not the origins of the cards were the businesses identified on the face of the cards. Accordingly, there appears to be no evidentiary basis for the officer’s statement that he believes the cards are counterfeit.

[54] Second, at paragraph 11, the officer deposed, “Chemysh [sic] appeared to be expecting the package…” This comment is misleading because Officer Tarachandra was not present at the arrest yet he purports to interpret the applicant’s state of mind at the time of arrest.

[55] In my view, both statements should be excised as misleading.

[56] At paragraph 16, the officer deposed “I know from leading prior investigations in my capacity as an Integrated Counterfeit Enforcement Team/Payment Card Team Leader that counterfeit payment cards are frequently sent to Canada from Chinese addresses and that those cards are intended to be reprogrammed with financial data that is utilized to fraudulently obtain goods and services, or to access the accounts of legitimate account holders. This is approximately the 8^th similar shipment of counterfeit payment card that I have encountered in the course of my duties over the last 3 years.”

[57] On cross-examination it became clear that this paragraph was misleading in several respects. Contrary to the implication that the officer was involved in the prior investigations, the officer’s knowledge was actually information gleaned from other police forces. Second, the origin of the card blanks in prior cases was not China. Third, the quantities of cards in prior cases were very large, at least in the dozens. Fourth, in the prior cases there were steps to conceal the identity of the recipients.

[58] Crown counsel acknowledges that this paragraph should be excised and that the differences between the circumstances in the present case and those in past investigations of blank payment cards should have been disclosed.

[59] The ITO presented to the Justice of the Peace at Toronto on November 14 cites a fourth offence with of which the applicant is suspected in addition to the three cited in the ITO of November 13: trafficking in property obtained by crime contrary to s. 355.3 of the Code. That section reads:

355.3 [T]he importation into Canada or exportation from Canada of any property or thing or any proceeds of any property or thing is prohibited if all or part of the property, thing or proceeds was obtained by or derived directly or indirectly from

(a) the commission in Canada of an offence punishable by indictment; or

(b) an act or omission anywhere that, if it had occurred in Canada, would have constituted an offence punishable by indictment.

[60] This additional offence is a particularized subset of the more generic offence of trafficking in property obtained by crime. It does not add to the strength of the ITO. No offence is identified by which the property is said to have been obtained.

[61] The test on the application is whether the Justice of the Peace could reasonably have issued the search warrant, and not whether this court would have done so. The applicant has met the onus, in my view, of showing that the search warrant could not reasonably have been issued on the ITO as amplified. After excision of the statement that blank cards had been found in the applicant’s wallet after he was arrested and excision of the misleading material, the ITO of November 14 contains no more evidence than was presented to the Justice of the Peace at Milton on November 13.

[62] In my view, there was no evidentiary basis upon which a search warrant could reasonably be issued based on the November 14 ITO as amplified.

[63] The search of the applicant’s home and into his computer were thus warrantless and in breach of s. 8 of the Charter. In my view, the breach was a severe one. It emanated from a disregard of the applicant’s Charter rights and equally from a disregard for the duty upon the police to adhere to its obligations under the Criminal Code. The search emanated from a mere hunch and played out in the context of knowledge on the part of the lead investigator that there were no reasonable grounds for it.

[64] The search was not invalidated by a mere technical defect, but rather was a search without foundation.

[65] As the search was of the applicant’s home and of the contents of his computer, the intrusion into privacy was high and the impact on the applicant significant. As the court stated in R. v. Silveira, [1995] 2 S.C.R. 297 at para 153:

It is hard to imagine a more serious infringement of an individual’s right to privacy. The home is the one place where persons can expect to talk freely, to dress as they wish and, within the bounds of the law, to live as they wish. The unauthorized presence of agents of the state in a home is the ultimate invasion of privacy.

[66] If indeed there is a more serious infringement of a person’s right to privacy, it would be a breach of the privacy in his personal computer or communication device. That a person’s privacy interest in the contents of his computer may reasonably extend even as against those with whom he cohabits is recognized by the provision by computer manufacturers of password protection of contents and is demonstrated by users in using password protection of contents. The rights infringed when the contents of a person’s computer seized are at the extreme high end of the spectrum and the impact is, in my view, severe.

[67] Both of the foregoing factors from. R. v. Grant, 2009 SCC 32 militate in favour of exclusion of the evidence.

[68] The intended product of the search was equipment and information relevant to the production of fraudulent payment cards. The by-product of the search was the discovery of some 34 images of child pornography and is the foundation of count 3 of the indictment. There is no suggestion that the second search warrant, issued on a third ITO and applied for after the child pornography was found, yielded further evidence upon which the Crown relies.

[69] The images are reliable evidence and are central to the crown’s case.

[70] The offence of possession of child pornography is serious and I am mindful that the offence is but the tip of the iceberg in terms of societal harm; it is the existence of consumers that feeds the industry making the material and it causes both known and untold harm and suffering to the vulnerable infants and children who are exploited in the process. But criminal offences lie along a long continuum of severity and atrocity, even sexual offences.

[71] Where the Charter breaches are severe and, particularly, where they are willful or reckless, or worse, and where the impact on the accused person’s privacy rights is high, the interest in trial of the offence on its merits, even a serious offence, will seldom outweigh the societal interest in maintaining the long term repute of the administration of justice. Otherwise the end will be seen to justify the means. (See R. v. McGuffie, 2016 ONCA 365 at para 63 and R. v. Harrison, 2009 SCC 34 at paras 39 - 40.)

[72] In the case at bar, I am of the view that the balance weighs in favour of exclusion of all of the evidence obtained as a result of the search warrant issued on November 14, 2013.

[73] The application is therefore granted.

___________________________ Low J.

Released: October 28, 2016