2003 FCA 191
A-195-02
Douglas L. Crowe (Appellant)
v.
Her Majesty the Queen (Respondent)
A-196-02
Kenneth A. Cush (Appellant)
v.
Her Majesty the Queen (Respondent)
Indexed as: Crowe v. Canada (C.A.)
Court of Appeal, Rothstein, Evans and Malone JJ.A.-- Calgary, April 2; Ottawa, April 17, 2003.
Judges and Courts -- Provincial court judges seeking to deduct from income tax membership dues in judge's association -- Remuneration of provincial court judges contentious matter in Alberta for over a decade -- Association's Executive Committee spending 90% of time on judicial independence, compensation, litigating against Alberta Government -- T.C.J. holding judges not "public servants" due to constitutional status as independent office holders precluded from bargaining with Government -- If public servants, dues would have been deductible -- Argued that judicial independence not impaired by allowing as income tax deduction dues paid association fighting for judicial independence -- "Public servants" not including judges, meaning civil servants or government employees -- Judicial branch of government operates independently of executive, legislative branches -- Reference to English, French language dictionaries as to meaning of "public servant" -- None including judges in definition -- Same conclusion supported by statutory context -- That legislation extending to judges certain benefits enjoyed by public servants not making judges public servants -- In constitutional context, wrong to call judge "public employee" as not "servant" subject to master's control -- Terms of relationship with state dictated by Constitutional terms, conventions -- To say judges "serve" public by administering justice not making them "public servants" for ITA purposes -- Court mandated judicial compensation commissions making recommendations to government so different from normal collective bargaining process, Parliament could not have intended to include judges' associations in "associations of public servants" -- Advent of judicial compensation commissions not eroding distinction between judges, workers governed by collective bargaining process.
Income Tax -- Income calculation -- Deductions -- Income Tax Act, s. 8(1)(i)(iv) permitting deduction of dues paid association of public servants -- Provincial court judges seeking to deduct dues paid judges' association which concentrates efforts on judicial independence, compensation, litigating against Alberta Government -- Issue: for tax deduction purposes, are provincial court judges "public servants?" -- Considering dictionary definitions, statutory, constitutional contexts, judges not "public servants" -- To say judges "serve" public by administering justice, not making them "public servants" for ITA purposes -- Broad definition proposed by taxpayers goes against narrow limitation of deduction to dues paid "associations of public servants", not broader wording as any association of employees, whether unionized or not, in both public, private sectors -- Taxpayers' interpretation ignoring labour relations context of provision from which inferred Parliament contemplating associations, while not certified bargaining agents, negotiating collectively for members -- Court mandated judicial compensation commissions which make recommendations to government so far removed from normal collective bargaining, Parliament could not have meant to include judges' associations within "associations of public servants".
Appellants, Alberta Provincial Judges' Association members, each sought to deduct annual dues of $1,500 but this was disallowed by the Minister. The Tax Court of Canada having dismissed their appeal, they appealed to the Federal Court of Appeal.
Income Tax Act, subparagraph 8(1)(i)(iv) permits the deduction of membership dues paid to an association of public servants. The issue was whether provincial court judges are, for the purposes of this statutory provision, "public servants".
The remuneration of Alberta's Provincial Court judges has been a contentious matter since 1989 and the Association was granted intervener status in litigation which, together with cases concerning the independence of judges of other provincial courts, went all the way up to the Supreme Court of Canada. The Association's Executive Committee devotes 90% of its time to issues of judicial compensation, judicial independence and litigation against the Government of Alberta.
The Tax Court Judge held that judges were not "public servants" in view of their constitutional status as independent office holders precluded by the Constitution from bargaining terms and working conditions with Government, the source of their compensation. Had they been public servants, the dues would have been deductible.
The relevant legislation allows for the deduction of amounts paid by a taxpayer as annual trade union dues or to maintain membership in an association of public servants, the object of which is to promote the improvement of members' conditions of employment or work.
Held, the appeals should be dismissed.
The issue being one of statutory interpretation, the judgment appealed from was to be reviewed according to the standard of correctness.
It was argued for taxpayers that the words "public servants" should be broadly construed so as to include all those paid out of the public purse. The argument was that judicial independence could not be compromised by allowing, as income tax deduction, dues paid to an association which fights for their independence. The respondent argued that "public servants" are subject to supervision and work under a collective agreement. The Constitution prohibits judges from labour relations bargaining with Government.
It had to be concluded that the term "public servants" does not extend to judges but refers to "civil servants" or "government employees". It does not include members of the judicial branch of government which operates independently of the executive and legislative branches. Reference to numerous English- and French-language dictionaries as to the definition of "public servant" reveal that it means a civil servant and that, in France, the term has a wider connotation, including such occupations as teachers, social workers and railway employees, but no dictionary includes judges in the definition.
The same conclusion was supported by general statutory contexts. For example, the Public Service Employment Act (PSEA) of 1966-1967 replaced the Civil Service Act. The powers of the Public Service Commission were the same as those formerly possessed by the Civil Service Commission. Federal Judges are appointed, not under the PSEA, but by authority of Constitution Act, 1867 and sections 96 and 100 and the Judges Act. In Alberta, provincial judges are appointed, not under the provincial Public Service Act but rather under Provincial Court Act. That both federal and provincial legislation extends to judges certain benefits provided by public service statutes does not make judges public servants: Valente v. The Queen.
In the constitutional context, it was said by McDonald J. in an Alberta case, R. v. Campbell, that "In Canada it is inaccurate to refer to a judge as a `public employee' because an employee or, to use legal terminology, a `servant', is subject to the control of his or her employer or `master' as to the manner in which he or she performs his or her duties. A judge is not subject to the control of the Crown (the executive government) or of the legislature." Again, in Wells v. Newfoundland, Major J. pointed out that, as for judges and "others who fulfil constitutionally defined state roles", the "terms of their relationship with the state are dictated by the terms and conventions of the Constitution". The Constitution was seen as the basis for the distinction between the situation of judges and senior public officials--such as administrative agency members--who enjoy a significant degree of decision-making and operational independence from the Executive.
Taxpayers argued that, since under the Income Tax Act, an "employee" includes an "officer" and "office" includes "a judicial office", judges are, for the purpose of subsection 8(1), employees. Thus it was submitted that public servants could include judges and that the extended definitions in subsection 248(1) free the term "public servants" in subparagraph 8(1)(i)(iv) from its general meaning as excluding judges. But to say that judges "serve" the public by administering justice does not make them "public servants" for Income Tax Act purposes.
It was argued for appellants that judges, as workers and taxpayers, should, like others, be able to claim legitimate tax deductions. There was high authority for the proposition that, in exceptional circumstances, courts have to resort to the residual presumption and interpret the Act in taxpayer's favour. But the broad rationale proposed by appellants failed to explain why the subparagraph limits eligible membership dues to those paid to "associations of public servants" rather than any association of employees, whether unionized or not, in both the public and private sectors. Furthermore, the interpretation suggested by appellants ignored the labour relations context of the provision from which it could be inferred that Parliament had in mind associations that, while not certified as bargaining agents, did negotiate collectively on their members' behalf.
In Alberta, to compensate for the constitutional ban on compensation negotiations between judges and their "employer", the Court mandated the establishment of judicial compensation commissions to make recommendations to government. The Alberta Provincial Judges' Association instituted litigation when government rejected the first commission's recommendations. This is so far removed from the usual collective bargaining pattern that the intention to include judges' associations in the words "associations of public servants" could not be attributed to Parliament. The advent of judicial compensation commissions had not significantly eroded the distinction between the position of judges from that of workers governed by the normal labour relations bargaining process.
statutes and regulations judicially
considered
Canada Labour Code, R.S.C., 1985, c. L-2, ss. 3(1) "trade union", 6.
| Civil Service Act, S.C. 1960-61, c. 57. |
| Constitution Act, 1867, 30 & 31 Vict., c. 3 (U.K.) (as am. by Canada Act 1982, 1982, c. 11 (U.K.), Schedule to the Constitution Act, 1982, Item 1) [R.S.C., 1985, Appendix II, No. 5], ss. 96, 100. |
| Income Tax Act, R.S.C., 1985 (5th Supp.), c. 1, ss. 8(1)(i)(iv), 248(1) "employee", "employer", "employment", "office", 250(1)(c). |
| Income Tax Act, S.C. 1948, c. 52, s. 11(10) (as enacted by S.C. 1951, c. 51, s. 3). |
| Industrial Relations and Disputes Investigation Act, R.S.C. 1952, c. 152, ss. 2(1) "trade union", 55. |
| Judges Act, R.S.C., 1985, c. J-1. |
| Labour Relations Code, R.S.A. 2000, c. L-1, ss. 1(x), 4(2). |
| Provincial Court Act, R.S.A. 2000, c. P-31. |
| Public Servants Inventions Act, R.S.C., 1985, c. P-32, s. 2 "public servant". |
| Public Service Act, R.S.A. 2000, c. P-42. |
| Public Service Employee Relations Act, R.S.A. 2000, c. P-43. |
| Public Service Employment Act, R.S.C., 1985, c. P-33. |
| Public Service Employment Act, S.C. 1966-67, c. 71. |
| Public Service Staff Relations Act, R.S.C., 1985, c. P-35. |
cases judicially considered
applied:
R. v. Campbell (1994), 160 A.R. 81 (Q.B.); Wells v. Newfoundland, [1999] 3 S.C.R. 199; (1999), 180 Nfld. & P.E.I.R. 269; 177 D.L.R. (4th) 73; 15 Admin. L.R. (3d) 274; 46 C.C.E.L. (2d) 165; 245 N.R. 275.
considered:
Valente v. The Queen et al. [1985] 2 S.C.R. 673; (1985), 52 O.R. (2d) 779; 24 D.L.R. (4th) 161; 23 C.C.C. 3d) 193; 49 C.R. (3d) 97; 19 C.R.R. 354; 37 M.V.R. 9; 64 N.R. 1; 14 O.A.C. 79.
referred to:
Reference re Remuneration of Judges of the Provincial Court of Prince Edward Island; Reference re Independence and Impartiality of Judges of the Provincial Court of Prince Edward Island; R. v. Campbell; R. v. Ekmecic; R. v. Wickman; Manitoba Provincial Judges Assn. v. Manitoba (Minister of Justice), [1997] 3 S.C.R. 3; (1997), 204 A.R. 1; 121 Man. R. (2d) 1; 156 Nfld. & P.E.I.R. 1; 150 D.L.R. (4th) 577; 118 C.C.C. (3d) 193; 11 C.P.C. (4th) 1; 217 N.R. 1; Québec (Communauté urbaine) v. Corp. Notre-Dame de Bon-Secours, [1994] 3 S.C.R. 3; [1995] 1 C.T.C. 241; (1994), 95 DTC 5017; 171 N.R. 161; 63 Q.A.C. 161.
authors cited
Canadian Oxford Dictionary. Toronto: Oxford University Press, 2001, "public servant".
Driedger, Elmer A. Construction of Statutes, 2nd ed. Toronto: Butterworths, 1983.
Finkelman, J. and S. B. Goldenberg. Collective Bargaining in the Public Service: The Federal Experience in Canada. Montréal: Institute for Research on Public Policy/Institut de recherches politiques, 1983.
ITP Nelson Canadian Dictionary of the English Language: An Encyclopedic Reference. Toronto: ITP Nelson, 1997, "public servant".
Merriam-Webster's Collegiate Dictionary, 10th ed. Springfield, Mass.: Merriam-Webster, 1998, "public servant".
Nouveau Petit Robert: dictionnaire alphabétique et analogique de la langue française. Paris: Dictionnaires Le Robert, 1993, "fonctionnaire".
Robert & Collins super senior: grand dictionnaire français-anglais, anglais-français, 2nd ed. Paris: Dictionnaires Le Robert; Glasgow: HarperCollins, 2000, "fonctionnaire".
Webster's Third New International Dictionary of the English Language. Springfield, Mass.: Meriam- Webster, 1986, "public servant".
APPEAL from a Tax Court of Canada decision (Crowe v. Canada, [2002] 2 C.T.C. 2513; 2002 DCT 1463) dismissing an appeal by judges of a provincial court seeking to claim as income tax deductions their membership dues in a judges' association. Appeal dismissed.
appearances:
Dr. Sheilah L. Martin, Q.C. for appellants.
William L. Softley and Brooke Sittler for respondent.
solicitors of record:
Code Hunter LLP, Calgary, for appellants.
Deputy Attorney General of Canada for respondent.
The following are the reasons for judgment rendered in English by
Evans J.A.:
A. INTRODUCTION
[1]Douglas L. Crowe and Kenneth A. Cush are judges of the Provincial Court of Alberta. They were also members of the Alberta Provincial Judges' Association during the years 1996 and 1997. They each claimed a deduction of $1,500 from their income for each of the tax years 1996 and 1997 in respect of the annual dues that they had paid to maintain their membership in the Association.
[2]The Minister of National Revenue disallowed the claims. The Tax Court of Canada dismissed their appeal in a decision reported as Crowe v. Canada, [2002] 2 C.T.C. 2513. The appellants now appeal to this Court. Since a single statement of facts has been agreed for both cases and the appeals were heard together, one set of reasons will be given and a copy placed in each file.
[3]Subparagraph 8(1)(i)(iv) of the Income Tax Act, R.S.C., 1985 (5th Supp.), c. 1 permits a taxpayer to deduct dues paid "to maintain membership in an association of public servants the primary object of which is to promote the improvement of the members' conditions of employment or work". The issue to be decided in this appeal is whether provincial court judges are "public servants" for the purpose of this provision.
[4]Counsel for the Crown also argued that, even if judges are "public servants", the appellants are still not entitled to the deduction because the "primary object" of the Association cannot be said to be "to promote the improvement of the members' conditions of employment or work". Because I conclude that judges are not public servants within the meaning of subparagraph 8(1)(i)(iv), it will not be necessary to decide this issue.
B. FACTUAL BACKGROUND
[5]While the lengthy agreed statement of facts need not be set out here, some background is appropriate. Although most judges of the Provincial Court belong to the Association, membership is not mandatory. The objects of the Association, as registered in Alberta's corporate registry on March 2, 1994, are, among other things,
. . . to discuss, study and consider matters of common interest to or relating to the welfare of judges of the Provincial Court of Alberta and to recommend to the appropriate authorities the enactment and implementation of such measures and policies as will, in the opinion of the Association, enhance the membership thereof to the end that there will be [a] strong independent Provincial Court of Alberta better able to continually improve its role in the administration of justice within Alberta.
[6]The remuneration of Provincial Court judges has been a contentious matter since 1989 when the Government of Alberta decided to abandon the practice that it had followed since the mid-1970s of fixing the salaries of Provincial Court judges as a percentage of the salary paid to federally appointed judges. In 1994, the salaries of Provincial Court judges were reduced by 5% by Order in Council as part of the Alberta Government's deficit reduction plan.
[7]The Association was granted status as an intervener in litigation brought by Provincial Court judges to challenge the constitutional validity of both the Order in Council and the absence of a provision for a cost-of-living increment to their salaries. The matter was ultimately determined by the Supreme Court of Canada, along with cases concerning the independence of the judges of other provincial courts: Reference re Remuneration of Judges of the Provincial Court of Prince Edward Island; Reference re Independence and Impartiality of Judges of the Provincial Court of Prince Edward Island; R. v. Campbell; R. v. Ekmecic; R. v. Wickman; Manitoba Provincial Judges Assn. v. Manitoba (Minister of Justice), [1997] 3 S.C.R. 3 (Judges Reference).
[8]As a result of that decision, a Judicial Compensation Commission was established in Alberta in 1998 for determining judicial compensation until April 30, 2000. The Association played a part in establishing an agreed framework for the Commission, and presented briefs and evidence to it on judicial salary levels and pensions. The Association obtained a declaration from the Alberta Court of Queen's Bench, which was upheld in the Court of Appeal, that an Order in Council giving judges a smaller salary increase than the Commission had recommended was unconstitutional.
[9]The Association took part in discussions with the Government on the establishment of a second Judicial Compensation Commission to deal with salaries from April 1, 2000 to March 31, 2003. Again, the Association made representations to the Commission on behalf of the judges.
[10]Since 1994, 90% of the time of the Executive Committee of the Association has been spent on issues relating to judicial compensation, judicial independence and litigation with the Government of Alberta. The Association incurred legal expenses of $1,500,000 in connection with these activities.
C. THE TAX COURT'S DECISION
[11]The Tax Court Judge held that the Association was an "association" within the meaning of subparagraph 8(1)(i)(iv), although this is not a term defined by the Income Tax Act. He noted that the words "public servants" were also undefined, but concluded that they did not include members of the judiciary because of judges' constitutional status as independent office holders who are precluded by the Constitution from bargaining over the terms and conditions of work with the Government, the source of their compensation.
[12]The Judge also concluded that, if he was wrong on this point, the primary object of the Association during the relevant period had been the promotion of its members' conditions of employment or work. Accordingly, if they had been public servants, the appellants would have been able to deduct the dues paid to the Association.
D. THE LEGISLATIVE FRAMEWORK
8. (1) In computing a taxpayer's income for a taxation year from an office or employment, there may be deducted such of the following amounts as are wholly applicable to that source or such part of the following amounts as may reasonably be regarded as applicable thereto:
. . .
(i) amounts paid by the taxpayer in the year as
. . .
(iv) annual dues to maintain membership in a trade union as defined
| (A) by section 3 of the Canada Labour Code, or |
| (B) in any provincial statute providing for the investigation, conciliation or settlement of industrial disputes, |
or to maintain membership in an association of public servants the primary object of which is to promote the improvement of the members' conditions of employment or work, (Emphases added.]
E. ANALYSIS
[13]As I have already indicated, the only question to be decided in this appeal is whether, as judges of the Provincial Court of Alberta, the appellants are "public servants" and the Association to which they have paid the membership dues that they are claiming to deduct is an "association of public servants". This is an issue of statutory interpretation and, as such, the Tax Court Judge's conclusion is reviewable on a standard of correctness.
[14]The appellants say that the Tax Court Judge erred in concluding that they could not be "public servants" because of the independent status of judges under the Constitution. Their counsel submitted that, in interpreting the disputed words, the Judge gave too little weight to their statutory context. Counsel argued that, for the purpose of subparagraph 8(1)(i)(iv), "public servants" should be construed broadly to mean any one paid from the public purse. Her argument was that judicial independence is not compromised by permitting the appellants, as taxpayers, to deduct dues paid to the Association, which has sought to enhance the terms and conditions of their work, including their independence and compensation.
[15]In contrast, the respondent says that the term "public servants" has a general meaning in both ordinary speech and the law and that, since it is not a specially defined term in the Income Tax Act, its general meaning is an important part of the background against which subparagraph 8(1)(i)(iv) should be interpreted. Indeed, counsel argued, the statutory context of the Income Tax Act supports the meaning borne by the words "public servants" in other contexts, namely, persons employed in the public service who are subject to supervision and who work under a contract of employment which they negotiate with the Government. As independent office holders who are precluded by the Constitution from labour relations bargaining with the Government over their terms and conditions of work, judges are not public servants.
[16]Before embarking on any exercise of statutory interpretation a court should recall the sentence that the Supreme Court of Canada has often said best captures the approach followed by Canadian courts. It is found in Driedger, Construction of Statutes, 2nd ed. (Toronto: Butterworths, 1983), at page 87:
Today there is only one principle or approach, namely, the words of an Act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament.
"public servants": ordinary meaning
[17]If, instead of "public servants", Parliament had used the words "civil servants", judges would not have been included. Conversely, if Parliament had used the words "public servants or holders of public office" judges might well have been included. However, counsel for the appellants submits, the meaning of "public servants" is less clear-cut and could well include judges who are serving the public by administering justice.
[18]In my opinion, however, the balance of the evidence favours the conclusion that, as ordinarily understood, the term "public servants" does not include judges but approximates to "civil servants" or "government employees", not independent office holders. It does not include members of the judicial branch of government which performs its work independently of the executive and legislative branches.
[19]For example, The Canadian Oxford Dictionary (Toronto: Oxford University Press, 2001) defines a "public servant" as a "government employee, esp. of a federal government". The definition in Merriam- Webster's Collegiate Dictionary, 10th ed. (Springfield, Mass.: Merriam-Webster, 1998) is very similar, namely, "government official or employee". The ITP Nelson Canadian Dictionary of the English Language: An Encyclopedic Reference (Toronto: ITP Nelson, 1997) defines "public servant" to mean "civil servant". A somewhat broader range of meanings is reported in Webster's Third New International Dictionary of the English Language (Springfield, Mass.: Merriam-Webster, 1986), including "a holder of public office" and "an individual . . . rendering public service".
[20]The French text of subparagraph 8(1)(i)(iv) uses the word "fonctionnaire", which is defined in Le Nouveau Petit Robert: dictionnaire alphabétique et analogique de la langue française (Paris: Dictionnaires Le Robert, 1996) as "personne qui remplit une fonction publique; personne qui occupe, en qualité de titulaire, un emploi permanent dans les cadres d'une administration publique (spécialit. l'État)".
[21]Similarly, Le Robert & Collins super senior: grand dictionnaire français-anglais, anglais-français, 2nd ed. (Paris: Dictionnaires Le Robert; Glasgow: HarperCollins, 2000) defines "fonctionnaire" as "state employee; (dans l'administration) [ministère] government official, civil servant; [municipalité] local government officer ou official". This dictionary also notes that, in France, "le service public" has a wider connotation than "civil service" and includes "teachers, social service staff, post office workers and employees of the French rail service." Despite the variety of the positions in this list, it notably does not include judge.
[22]I do not say that in ordinary speech the words "public servants" or "fonctionnaires" are limited to civil servants, although this may be their paradigm meaning. They are also used more generally to refer to people employed in the public service, more broadly understood. However, the dictionaries do not indicate that judges are included, although I suppose that if a person were asked to categorize judges as either public servants or private employees, a person might well say that they were public servants.
"public servants": general statutory contexts
[23]Counsel for the respondent submitted that the general legal meaning of "public servant" may be indicated by its use in other statutes, which show that the term is closely connected to, even if not precisely synonymous with, "civil servant". For example, the Public Service Employment Act, S.C. 1966-67, c. 71, replaced the Civil Service Act, S.C. 1960-61, c. 57. As a result, the Civil Service Commission became the Public Service Commission.
[24]The Public Service Commission's power to appoint employees into the public service is analogous to the Civil Service Commission's power to appoint employees into the civil service. Similarly, the Alberta Public Service Act, R.S.A. 2000, c. P-42, provides for the appointment of employees into the public service. In contrast, the federal government's power to appoint judges is derived from sections 96 and 100 of the Constitution Act, 1867 [30 & 31 Vict., c. 3 (U.K.) (as am. by Canada Act 1982, 1982, c. 11 (U.K.), Schedule to the Constitution Act, 1982, Item 1 [R.S.C., 1985, Appendix II, No. 5]] and the Judges Act, R.S.C., 1985, c. J-1, not the Public Service Employment Act [R.S.C., 1985, c. P-33]. Similarly, the government of Alberta's power to appoint judges is contained in the Provincial Court Act, R.S.A. 2000, c. P-31, not the province's Public Service Act.
[25]Counsel for the respondent also pointed to the Public Servants Inventions Act, R.S.C., 1985, c. P-32, as further evidence that "public servants" normally means "civil servants", and not judges. Thus, "public servant" is defined in section 2 to mean:
2. . . .
. . . any person employed in a department, and includes a member of the Canadian Forces or the Royal Canadian Mounted Police.
[26]I agree with these submissions, although I would also observe that the introduction of subparagraph 8(1)(i)(iv) in 1951 [S.C. 1951, c. 51, s. 3] preceded the statutory changes in nomenclature from civil to public service, which suggests that Parliament intended to include more than those employed in government departments. It is difficult to say with any precision how far the category of "public servants" was intended to extend beyond the core civil service. Nonetheless, it is not a term that would have been taken to include judges.
[27]I also agree that the fact that both federal and provincial legislation extends to judges some of the benefits provided in public service statutes does not make judges civil or public servants: Valente v. The Queen et al., [1985] 2 S.C.R 673, at page 708. Indeed, the express extension of these provisions to judges only serves to emphasize that, in the absence of such a provision, judges are not covered by public service legislation because they are not members of the public service as that term is normally used in statutes.
"public servants": constitutional context
[28]Neither the Constitution nor, generally speaking, the jurisprudence interpreting it, expressly and specifically states that judges are, or are not, public servants. The closest is R. v. Campbell (1994), 160 A.R. 81 (Q.B.), one of the cases in which it was argued that the Alberta Government's reduction of the salaries of Provincial Court judges and the absence of an appropriate mechanism for determining the judges' compensation were incompatible with the constitutional principle of judicial independence. McDonald J. was of the view that judges are not public servants. He stated (at paragraph 71):
In Canada it is inaccurate to refer to a judge as a "public employee" because an employee or, to use legal terminology, a "servant", is subject to the control of his or her employer or "master" as to the manner in which he or she performs his or her duties. A judge is not subject to the control of the Crown (the executive government) or of the legislature as to the manner in which he or she performs his or her judicial functions: that is the essence of judicial independence.
[29]Another suggestive case is Wells v. Newfoundland, [1999] 3 S.C.R. 199, in which a member of a provincial regulatory agency, the Public Utilities Board, claimed damages for breach of contract when his office disappeared on the statutory abolition of the agency. Wells had been appointed by Order in Council during good behaviour until the age of 70. Writing for the Court, Major J. said [at paragraph 30] that the employment relationship between the Crown and senior public employees was based on contract to which "the general law of contract will apply unless specifically superseded by explicit terms in the statute or agreement." Major J. concluded that Wells's employment relationship was governed by contract. He said (at paragraphs 31-32):
This is the case for most senior public officers. Exceptions are necessary for judges, ministers of the Crown and others who fulfil constitutionally defined state roles. The terms of their relationship with the state are dictated by the terms and conventions of the Constitution. . . .
The fundamental terms and conditions of these relationships cannot be modified by either party, even by agreement. For instance, a judge cannot negotiate his or her salary or other terms of employment. . . . These individuals still serve under specified terms. The mechanism for enforcement of those terms is not in contract, but through a declaration of the constitutional guarantees underlying their positions.
[30]Thus, Major J. found in the Constitution the basis of the distinction between the legal relationship to the state of judges and of other "senior public officials", including a member of an administrative agency that enjoys a significant degree of decision-making and operational independence from the Executive. This suggests to me that judges are not readily included in the general category of "public servants".
[31]This point is underscored by judicial statements to the effect that, even though judges are paid from the public purse, their constitutional status means that they are not civil servants: see, for example, Judges Reference, at paragraph 143. However, since the words in dispute in the present appeal are "public servants", these cases only take the analysis so far. Nonetheless, these constitutional principles do form part of the interpretive context. In particular, they support the view that, in the wider legal system in which the Income Tax Act is located, judges are differentiated from public employees.
"public servants": Income Tax Act
[32]As I have already indicated, the Income Tax Act does not define the words "public servants". Counsel for the respondent pointed out that in paragraph 250(1)(c) Parliament used the words "officer or servant of Canada", thus indicating that servants do not include officers. However, since "public servants" in subparagraph 8(1)(i)(iv) is a composite term, paragraph 250(1)(c) is of limited significance.
[33]Counsel for the appellants argued that the definitions in subsection 248(1) of other key terms in subsection 8(1) indicate not only that the Act does not preclude the possibility that a judge can be a public servant, but also that it contemplates it. Thus, since an "employee" includes an "officer", and "office" includes "a judicial office", judges are employees for the purpose of subsection 8(1). Moreover, the "employer" in respect of an officer is defined as the "person from whom the officer receives the officer's remuneration" which, in the case of the appellants, is the Government of Alberta. "Employer" is not defined as the person who controls how the officer performs her or his work. Finally, subsection 248(1) introduces the notion of "service" by defining "employment" as "the position of an individual in the service of some other person (including Her Majesty . . . )".
[34]From these definitions and the structure of subsection 8(1), counsel argued that "public servants" must be either employees or officers and that, since "office" includes judicial office, public servants can include judges. Further, since judges are employees by virtue of these definitions they are in "employment" and "serve" Her Majesty. Counsel denied that her argument committed her to the syllogism that since public servants are employees or officers, terms that include judges, all employees or office holders, including judges, are therefore public servants. Rather, she made the more modest claim that, on the wording of the Act, a judge may be a public servant and that the extended definitions contained in subsection 248(1) shake the term "public servants" in subparagraph 8(1)(i)(iv) free from the grip of its general meaning as excluding judges.
[35]In my opinion, this argument does not significantly advance the appellants' position. To say that judges "serve" the public by administering justice does not necessarily make them "public servants" for the purpose of the Income Tax Act. The definitional gap is not closed. Further, taxpayers claiming a deduction under any of the provisions of subsection 8(1) must establish that they meet the criteria of eligibility. To succeed in their claim under subparagraph 8(1)(i)(iv), the appellants must establish that, as judges, they are public servants. It does not seem very useful to say that the Act does not in terms preclude the possibility that judges may fall within the term, "public servants". This still leaves us with the initial question: are judges included in this term?
[36]In my view, the answer to this question does not lie in shuffling the deck of statutory definitions. It is more productive to inquire into the purpose underlying subparagraph 8(1)(i)(iv). The deduction has existed in its present form since it was first introduced in 1951: Income Tax Act, S.C. 1948, c. 52, subsection 11(10), as added by S.C. 1951, c. 51, subsection 3(3). However, counsel were unable to uncover any legislative history in the form of parliamentary debates, white papers or technical notes explaining the reason for its introduction and its intended scope.
[37]Counsel for the appellants submitted that, as taxpayers and workers, judges should, like others, be entitled to claim legitimate deductions from their income. The underlying rationale of the subparagraph is that taxpayers should not be taxed on that part of their income paid in membership dues to an association to support its activities undertaken to improve the terms and conditions of members' employment. Counsel argued that permitting judges the benefit of the deduction in subparagraph 8(1)(i)(iv) could not reasonably be said to impair their independence. Accordingly, there was no reason to interpret the term "public servants" narrowly. In exceptional circumstances, a court must resort to the residual presumption by interpreting the Income Tax Act in favour of the taxpayer: Québec (Communauté urbaine) v. Corp. Notre-Dame de Bon-Secours, [1994] 3 S.C.R. 3, at pages 18-20.
[38]In my opinion, however, a purposive approach to the interpretation of the subparagraph does not favour the appellants. First, the broad rationale of subparagraph 8(1)(i)(iv) suggested by counsel for the appellants does not explain why the subparagraph limits eligible membership dues to those paid to "associations of public servants". If the purpose were as broad as counsel suggested, one would have expected subparagraph 8(1)(i)(iv) to have applied to membership dues paid to any association of employees, whether unionized or not, in both the public and the private sectors which existed to improve its members' terms and conditions of employment. Hence, an interpretation of "public servants" that goes beyond its general meaning cannot be justified by reference to the policy rationale of subparagraph 8(1)(i)(iv) advanced on behalf of the appellants.
[39]Second, the appellants' interpretation of "public servants" ignores the labour relations context of the provision, which is principally concerned to permit the deduction of dues paid to a trade union as defined under either the general federal labour relations statute, or the applicable provincial legislation. It is reasonable to infer from this that, by "associations of public servants", Parliament had in mind associations that, although not certified under federal or provincial labour law as bargaining agents, did in fact negotiate collectively with the employer on behalf of their members for improvements to their working conditions.
[40]When what is now subparagraph 8(1)(i)(iv) was first added to the Income Tax Act, in 1951, most employees of the federal and all provincial governments, except Saskatchewan, were excluded from the collective bargaining regimes created by labour relations statutes. Collective bargaining took place, however, but it was neither regulated not recognized by legislation. Thus, for instance, collective bargaining in the federal public service took place in the National Joint Council, a body consisting of representatives of federal government staff associations and senior government officials that had been created in 1944 to advise the Treasury Board on working conditions in the federal public service: see J. Finkelman and S. Goldenberg, Collective Bargaining in the Public Service: The Federal Experience in Canada (Montréal: Institute for Research on Public Policy/Institut de recherches politiques, 1983), at pages 5-9.
[41]Even today, most jurisdictions in Canada exclude government employees from general labour relations statutes. For example, the definition of "trade union" in section 3 of the Canada Labour Code, R.S.C., 1985, c. L-2, is as follows:
3. (1) . . .
"trade union" means any organization of employees, or any branch or local thereof, the purposes of which include the regulation of relations between employers and employees;
[42]While this is broad enough to cover associations of public servants, section 6 provides that Part I of the Code, which includes section 3, does not apply to employment by Her Majesty. Consequently, the words "employers" and "employees" in the definition of "trade union" in section 3 do not include employees of Her Majesty or Her Majesty. Therefore, "trade union" in subparagraph 8(1)(i)(iv) of the Income Tax Act does not include an organization of employees of the federal Crown. Their membership dues are therefore deductible as paid to an "association of public servants" that satisfies the criteria of subparagraph 8(1)(i)(iv).
[43]Similar, but not identical language was used in the original version of this provision: Income Tax Act, S.C. 1948, c. 52, subparagraph 11(10)(d)(i), as added by S.C. 1951, c. 51, subsection 3(3). The federal labour legislation then in force, the Industrial Relations and Disputes Investigation Act, R.S.C. 1952, c. 152, paragraph 2(1)(r), contained a definition of "trade union" similar to that now in the Code. Section 55 excluded organizations of federal civil servants from the definition of "trade unions" by providing that, with certain exceptions, Part I did not apply to "Her Majesty in right of Canada or employees of Her Majesty in right of Canada".
[44]Provincial labour relations legislation also typically excludes the public service: see, for example, the Labour Relations Code, R.S.A. 2000, c. L-1, paragraph 1(x) and subsection 4(2). Separate statutory regimes govern collective labour relations in the public service of both Canada and the provinces: see, for example, Public Service Staff Relations Act, R.S.C., 1985, c. P- 35; Public Service Employee Relations Act, R.S.A. 2000, c. P-43.
[45]In contrast, judges are constitutionally prohibited from bargaining with the government that pays them the terms and conditions under which they work. This point was made in the passage from Wells quoted at paragraph 29 of these reasons, and in the Judges Reference case (at paragraphs 186-187):
. . . negotiations for remuneration from the public purse are indelibly political. For the judiciary to engage in salary negotiations would undermine public confidence in the impartiality and independence of the judiciary, and thereby frustrate a major purpose of s. 11(d) [of the Charter]. . . .
The appearance of independence would be lost, because salary negotiations bring with them a whole set of expectations about the behaviour of the parties to the negotiations which are inimical to judicial independence. The major expectation is of give and take. . . . the reasonable person might conclude that judges would alter the manner in which they adjudicate cases in order to curry favour with the executive . . . . the reasonable person might expect that judges would adjudicate in such a manner so as to exert pressure on the Crown.
[46]As a result of the constitutional ban on compensation negotiations between judges and their "employer", the Court mandated the creation of judicial compensation commissions to make recommendations to the government. The Alberta Provincial Judges' Association was active in the design of the first two Alberta commissions, made representations to them on behalf of its members and instituted litigation challenging the constitutionality of the government's rejection of the first commission's recommendations.
[47]In my view, however, these activities are so far removed from the familiar patterns of collective bargaining over pay and conditions between trades unions and employers that I cannot attribute to Parliament an intention to include judges' associations in the words "association of public servants". Indeed, in the Judges Reference case, (at paragraph 188) Lamer C. J. expressly distinguished the "horse-trading" that takes place between the parties in the course of labour relations bargaining from
. . .expressions of concern and representations by chief justices and chief judges of courts, or by representative organizations such as the Canadian Judicial Council, the Canadian Judges Conference, and the Association of Provincial Court Judges, on the adequacy of current levels of remuneration. Those representations merely provide information and cannot, as a result, be said to pose a danger to judicial independence.
[48]I do not think that the advent of judicial compensation commissions has significantly eroded this distinction. Given the labour relations context of subparagraph 8(1)(i)(iv), it would be incongruous to find in the same category, namely, "public servants", two fundamentally different groups of workers: those who may bargain over terms and conditions of employment or work and those who are constitutionally precluded from such activities.
F. CONCLUSIONS
[49]For these reasons, I am satisfied that the Tax Court Judge was correct to interpret the words "association of public servants the primary object of which is to promote the improvement in the members' conditions of employment or work" as inapplicable to the Alberta Provincial Judges' Association since judges are not "public servants" for this purpose.
[50]The term "public servants" has a general meaning in both ordinary speech and the law which does not include judges and which fits comfortably with the purpose and context of the provision of the Income Tax Act under consideration here. Accordingly, the appellants were not entitled to deduct from their income in the tax years 1996 and 1997 their membership dues in the Association under subparagraph 8(1)(i)(iv).
[51]I would dismiss the appeals with costs.
Rothstein J.A.: I agree.
Malone J.A.: I agree.