CUB 25617
TRANSLATION
IN THE MATTER of the UNEMPLOYMENT INSURANCE ACT
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IN THE MATTER of a claim by
CARMINE MAZZONNA
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IN THE MATTER of an appeal to an Umpire by the claimant from a decision
by the Board of Referees given on February 20, 1992 at Montréal, Québec.
CORRESPONDING FEDERAL COURT DECISION: A-614-94
DECISION
FORGET J.A.
Two periods are under appeal in this case, namely the winter of 1989 and the winter of 1990. The facts and the question at issue are identical for the two periods.
The claimant is appealing the majority decision of the Board of Referees, which confirmed the Insurance officer's decision that the claimant was not eligible to benefit because he had not proved that he was unemployed, as he was operating a business on his own account, with partners. The Commission terminated payment of benefit on November 26, 1990, under sections 8, 10, 43 and 86 of the Act and section 43(a) of the Regulations.
The claimant filed an initial benefit claim because of a lack of work, and this claim was established on November 25, 1990. He subsequently filled out a questionnaire on employment, in which he stated that he had owned 33% of the shares of Pavages & Paysagistes K.I. Bon Ltée since 1974. This was a company that specialized in laying asphalt, interlocking paving stone and sod, and it was thus a seasonal business. The owners advertised in the yellow pages, at a cost of $250.00 per month, 12 months a year, and the company's telephone lines also operated 12 months a year. The claimant drove a 1987 Stellar whose licence plate bore the name of the company. He handled office work and customer service, preparing estimates, tenders and contracts. The claimant stated that he had worked only for his company over the past five years. He was not looking for work elsewhere, because his business had become his principal source of income. He stated that he did not need to work for other employers during the winter because he continued to answer the telephone and to prepare for the new year, trying to obtain new contracts.
On April 24, 1991, the Commission notified the claimant that he was not entitled to benefit because he had not proved that he was unemployed, as he was operating a business on his own account, with partners, and was working full working weeks. Payment of benefit was terminated on November 26, 1990.
The claimant filed a renewal claim on November 15, 1991. He stated that he was available to work 40 hours per week. The Commission reexamined the claim and notified the claimant, on December 17, 1991, that it was maintaining its initial decision.
The claimant appealed this decision to a Board of Referees. He appeared before the Board in the company of his counsel, Mr. Denis Maiorino. The claimant produced a photocopy of his pay slip covering the period from May 1990 to November 1990. He stated that for the period from December to April, he removed the licence plates on his trucks and cancelled part of his insurance, maintaining only the fire and theft coverage on the warehouse. The Board of Referees noted the claimant's statement that he did not want to work for another employer. However, the claimant's representative stated that the claimant meant that he was not available during the period of operation of his company. The claimant produced a list of job searches, which unfortunately did not produce any results. He openly admitted that he had drawn unemployment insurance benefits during the winter for many years, and that in his view, this was a habit and a right from which he benefitted. The chairperson of the Board of Referees and one of the members found that the claimant was an experienced businessman and thus knew how to prepare his billings, despite the keen competition in his business. The majority of the Board of Referees found that Mr. Mazzonna was employed full-time by his own firm, and confirmed the Commission's decision. The dissenting member held that the claimant was unemployed during the winter season, and that the claimant had shown that he did not receive any profits from his company during the winter and only devoted a minimum amount of time to the business, which could not be regarded as full working weeks.
At the hearing before the Umpire, the claimant was represented by Ms. Lucia Salvatore. She argued that the majority decision of the Board of Referees seemed to have been based on the fact the majority accepted the report of the Commission's investigator, filed as Exhibit 5. She noted that the investigator was not present at the hearing before the Board of Referees, and that it was consequently impossible to cross-examine him. Ms. Salvatore also alleged that no evidence had been led before the Board of Referees. She claimed that the findings of the Board of Referees were erroneous and that the Board had consequently committed a serious error in law, which was not based on the evidence.
In opposition to these arguments, counsel for the Commission referred us to Exhibit 5 which, in her view, was sufficient in itself to allow the Board of Referees to find as it did. She said that she agreed that the work in question was seasonal and that if the claimant were a salaried employee, he would be recognized as being unemployed during the winter season. She claimed, however, that the claimant's situation was totally different because he was operating a business on his own account and this aspect of the matter did not change during the winter months. She declared that as the condition of unemployment had not been proved, the majority decision of the Board of Referees had to stand.
Section 43(1)(a) of the Regulations provides that when a claimant is self-employed or engaged in the operation of a business on his own account or in partnership or a co-adventure, he shall be regarded as working a full working week. However, section 43(2) of the Regulations qualifies section 43(1)(a) by stipulating that if a claimant's employment is so minor in extent that a person would not normally follow it as a principal means of livelihood, he shall, in respect of that employment, not be regarded as working a full working week.
The question at issue in the case at bar, like most of those raised by the two subsections, is as follows: Does the claimant's commercial activity fall within the purview of subsection 43(2) of the Regulations, being an activity "so minor in extent"? In CUB 5454, Dubé J. drew up a list of useful factors for determining whether the claimant devoted much time to his work: (1) the time devoted to the work; (2) the capital and resources invested; (3) the financial success or failure of the business; (4) the ongoing operation of the business; (5) the nature of the employment: is it the kind of business in which the claimant was normally interested?; and (6) the claimant's willingness to accept or look for another job.
The time that a claimant devotes to his business is likely the most decisive factor. In CUB 5454, Dubé J. noted in this regard:
This is not, of course, the sole consideration, but it is a valuable one. Obviously, a person who spends but a few minutes, or a very few hours a week in one endeavour does not consider that minor employment to be his principal means of livelihood.
Exhibits 3, 5 and 6 are very revealing in regard to the test described above. These exhibits confirm that all the criteria were considered in the application of this test by the Board of Referees.
In my opinion, the situation is certainly not the same as that of a salaried employee in the same circumstances. I am also of the view that evidence of billing on a 12-month basis does not seem to have been produced before the Board of Referees. I must add, however, that this lack of evidence is not an essential element necessary to the decision of the Board of Referees.
Consequently, I do not believe that the decision of the Board of Referees is undermined by an error in law. All the necessary elements were addressed by the Board of Referees, and the majority decision must be upheld.
The appeal is therefore dismissed.
UMPIRE
Ottawa, Ontario
August 15, 1994