T-2943-81
Brian L. Aimonetti (Plaintiff)
v.
The Queen (Defendant)
Trial Division, Nitikman D.J.—Winnipeg, April 5
and October 27, 1982.
Jurisdiction — Narcotics — R. 474(1)(a) application for
determination of question of law whether Federal Court having
jurisdiction to order return of money seized by R.C.M.P. under
s. 10(1), Narcotic Control Act, during residence search —
Question answered in affirmative — Money forfeited only if
used to purchase subject-matter of offence — Money not so
used — Minister custodian — Without power to decide title —
That to be decided by civil proceedings in Federal Court —
Narcotic Control Act, R.S.C. 1970, c. N-1, ss. 4, 10(1),(5),(6),
(7),(8) — Federal Court Rules. C.R.C., c. 663, RR. 420(1),(2).
474(1)(a).
Evidence — Estoppel — Money seized by police in search
ing residence for narcotics — Claim under s. 10(5) of the Act
heard by Provincial Court Judge — Right to possession only
dealt with — Question of ownership not res judicata —
Plaintiff not estopped from seeking return of money by order
of Federal Court — Narcotic Control Act, R.S.C. 1970, c.
N- I, s. 10(5).
This is an application pursuant to Rule 474(1)(a) for the
determination of two questions of law: whether the Federal
Court has jurisdiction to order the return of a sum of money
seized by the R.C.M.P. under subsection 10(1) of the Narcotic
Control Act during a search of the plaintiffs residence and,
alternatively, whether the plaintiff is estopped from seeking an
order for return of the money on the grounds that the issue is
res judicata because it was dealt with by the Provincial Court
Judge who heard his claim under subsection 10(5). After
having been found in possession of a quantity of prohibited
drugs, drug paraphanalia and $23,440 in cash during an
R.C.M.P. search of his residence, the plaintiff was convicted on
charges laid under the Narcotic Control Act. He subsequently
made a claim before a Provincial Court Judge under subsection
10(5) of the Act for restoration of the money that had been
seized. The Court held that the plaintiff was not entitled to
possession because he had failed to satisfy it that the money
was not associated with his criminal activities. The plaintiff
unsuccessfully sought an order of certiorari from the Manitoba
Queen's Bench to quash the judgment and was again unsuc
cessful when he brought an appeal from this decision to that
Province's Court of Appeal.
Held, question one is answered in the affirmative and ques
tion two in the negative. The Provincial Court Judge based his
decision to deny return of the money seized to the plaintiff on
the ground that it had been obtained through crime. However,
subsection 10(8) of the Act which provides for forfeiture to the
Crown of money seized in connection with the investigation of a
narcotic offence applies only if the money seized was used for
the purchase of the narcotic which was the subject-matter of
the offence for which the plaintiff was convicted. The money
here in question had not been used for such purpose. Further,
no right of forfeiture can be imported to subsection 10(7) which
provides that where no application has been made for return of
an article seized under subsection 10(1) within two months of
its seizure, that article shall be delivered to the Minister who
may make such disposition as he thinks fit. This subsection
merely makes the Minister a custodian and does not empower
him to decide the question of title. The decision as to title falls
to be determined in civil proceedings. The case of Smith v. The
Queen supports this view. The fact that the plaintiff tried to
obtain restoration under subsection 10(5) does not bar his right
to institute civil proceedings in this Court to determine the
ownership of the money and obtain an order for its return to
him. Further, the plaintiff is not estopped from bringing the
claim herein on the grounds that it is res judicata. According to
the principle of res judicata, when a question is litigated the
judgment of the court is a final determination as between the
parties and any question put directly in issue cannot be retried
in a subsequent suit between them. In this case the Provincial
Court Judge dealt only with the issue of whether the money in
question was associated with drug trafficking and the sole
effect of the decision is that the Minister is entitled to posses
sion of the monies and the plaintiff is not. The question of
ownership was not dealt with. This is confirmed by the Court of
Appeal judgment wherein it was stated that section 10 proce
dures merely entitle the Minister to possession and the accused
is subsequently entitled to advance a civil claim for recovery of
the property. Here the issue is ownership and thus is distinct
from the proceedings taken before the Provincial Court. Estop-
pel and res judicata do not, therefore, apply.
CASES JUDICIALLY CONSIDERED
APPLIED:
Smith v. The Queen, [1976] 1 F.C. 196; 27 C.C.C. (2d)
252 (T.D.).
CONSIDERED:
R. v. Aimonetti (1981), 8 Man.R.(2d) 271 (C.A.); Stif-
tung v. Rayner & Keeler Ltd. (No. 2), [1967] 1 A.C. 853
(H.L.); McIntosh v. Parent, [1923-24] 55 O.L.R. 552
(C.A.); Town of Grandview v. Doering, [1976] 2 S.C.R.
621; Haynes v. Wilson et al., [1914] 6 W.W.R. 1495
(Sask. S.C.).
REFERRED TO:
Angle v. Minister of National Revenue, [1975] 2 S.C.R.
248.
COUNSEL:
Martin Corne, Q.C. and I. Isenstein for
plaintiff.
Harry Glinter for defendant.
SOLICITORS:
Corne & Corne, Winnipeg, for plaintiff.
Deputy Attorney General of Canada for
defendant.
The following are the reasons for judgment
rendered in English by
NITIKMAN D.J.: This is an application by way
of motion on behalf of the defendant, pursuant to
Rule 474(1)(a) of the Federal Court Rules
[C.R.C., c. 663] for the determination of the
following questions of law:
1. Does the Federal Court of Canada have the jurisdiction to
order the return of the monies in issue in this action where in a
previous application for restoration, pursuant to Section 10(5)
of the Narcotic Control Act, Revised Statutes of Canada, 1970,
Chapter N-1, the presiding Provincial Judge held that the
Plaintiff was not entitled to possession of the said monies; or
2. In the alternative, is the Plaintiff estopped in this action from
seeking an order for the return of the said monies on the ground
that the issue has already been determined by the presiding
Provincial Judge, pursuant to Section 10(5) of the Narcotic
Control Act, Revised Statutes of Canada, 1970, Chapter N-1,
and the issue is therefore res judicata.
The statement of claim, in respect of which the
application is made and which shows Brian L.
Aimonetti as plaintiff and Her Majesty The Queen
as defendant, was filed on May 27, 1981. Para
graphs 3, 4, 5, 6, 7 and 8 read:
3. The Plaintiff says that on or about the 15th day of Febru-
ary, A.D. 1980 [sic] his home, a dwelling house, at 323
Collegiate Avenue, in the City of Winnipeg, in the Province of
Manitoba, was searched by the R.C.M.P. and the sum of
$23,440.00 was seized pursuant to The Narcotics [sic] Control
Act, R.S.C. 1970, Cap. N-1 and amendments thereto (herein-
after referred to as "The said Act").
4. The Plaintiff says that pursuant to S. 10(7) of the said Act,
the said monies were delivered to the Minister of National
Health and Welfare.
5. The Plaintiff alleges that the said Minister's power created
by the said Act is merely custodial and not a power to decide
any question of title to property.
6. The Plaintiff alleges that he is the owner of the said monies
and has title to the said monies, and no intervening right has
been created in the Minister to divest the Plaintiff of his title to
the said monies.
7. The Plaintiff alleges that no limitation period has been
created to prevent him from applying for a return of the
monies, nor has any forfeiture been created by operation of law
to divest him of his title or the right to claim.
8. The Plaintiff alleges that his title to the monies cannot be
interfered with and that the Minister is wrongfully and improp
erly detaining these monies against the Plaintiff and is creating
an unlawful conversion.
And in his prayer for relief, plaintiff claims:
9. The Plaintiff therefore claims:
(a) Judgment against the Defendant in the sum of
$23,440.00;
(b) Interest on the said sum of $23,440.00 until date of
payment;
(c) Costs of this action.
The statement of defence, filed August 18,
1981, denies that the plaintiff is entitled to the
return of the monies claimed and in paragraphs 4,
5 and 6, sets out:
4. As to the Statement of Claim as a whole, the Defendant
says that on March 7, 1979, the Plaintiff initiated an applica
tion under Section 10(5) of the Narcotic Control Act, Revised
Statutes of Canada, 1970, Chapter N-1, (the Act), for restora
tion of the monies set out in Paragraph 3 of the Statement of
Claim. The Application was heard on April 1, 1980, by Kop-
stein, P.J.C., who held that the Plaintiff was not entitled to
possession of the said monies because he had failed to satisfy
the Court that these monies were not associated with his
criminal activities. The application was therefore dismissed and
the said monies delivered to the Minister of National Health
and Welfare, who in accordance with Section 10(7) of the Act,
"may make such disposition thereof as he thinks fit".
5. In the premises the Defendant says that even if the Plaintiff
is the "owner" of the monies set out in Paragraph 3 of the
Statement of Claim, which allegation is not admitted but
denied, an intervening right has been created in the Minister of
National Health and Welfare to divest the Plaintiff of such
ownership and accordingly, the said Minister is lawfully in
possession of these monies as against the Plaintiff and is not
creating any unlawful conversion as alleged or otherwise.
6. In the alternative, the Defendant says that the monies set out
in Paragraph 3 of the Statement of Claim were associated with
or generated from criminal activities by the Plaintiff including
(inter alia), the trafficking in narcotics and that it would
therefore be against the law and contrary to public policy to
give possession of these monies to the Plaintiff, thereby allow
ing him to profit from his own wrongdoing.
In the within proceedings I shall throughout
refer to Aimonetti as the plaintiff and whenever in
the material that I shall be quoting from, any
reference to Aimonetti as the applicant shall be
taken to refer to the plaintiff in the within action.
The sequence of events leading up to the issue of
the statement of claim is set out in the affidavit of
Bruce A. MacFarlane, who deposes in part as
follows:
I, BRUCE A. MACFARLANE of the City of Winnipeg, in the
Province of Manitoba,
MAKE OATH AND SAY AS FOLLOWS:
1. 1 am a Barrister and Solicitor employed by the Winnipeg
Regional Office of the Federal Department of Justice, and as
such, have knowledge of the facts hereinafter deposed to.
2. On February 15, 1979, members of the Royal Canadian
Mounted Police, Winnipeg Drug Section, attended at 323
Collegiate Avenue, Winnipeg, Manitoba, the residence of Brian
L. Aimonetti, and conducted a search for narcotics.
3. Among the items seized were:
(a) 3 small boxes containing a total of 30 one ounce jars of
cannabis resin, valued in excess of $17,500.00 if sold by the
ounce;
(b) 2 glass jars containing a total of 54 grams of cannabis
resin;
(c) 1 glass jar containing 27 grams of cannabis resin;
(d) miscellaneous scales, empty jars, and syringes;
(e) $360.00 in cash from the person of Brian L. Aimonetti;
(f) gloves stained with cannabis resin from the person of
Brian L. Aimonetti;
(g) $22,000.00 in cash from the master bedroom closet, of
which $460.00 was stained with cannabis resin;
(h) $1,080.00 in cash from the master bedroom dresser;
(i) T-4 slip in the name of Brian L. Aimonetti for $3,554.02.
4. A fingerprint analysis of the ounce jars containing cannabis
resin revealed several fingerprints identified as those of Brian
L. Aimonetti.
5. As a result of the search and seizures, Brian L. Aimonetti
was charged that:
On or about the 15th day of February, A.D. 1979, at or near
the City of Winnipeg, in the Eastern Judicial District, Prov
ince of Manitoba, did unlawfully possess a narcotic to wit:
Cannabis Resin for the purpose of trafficking, contrary to
the provisions of the Narcotic Control Act and Amendments
thereto.
6. On January 10, 1980, after hearing all the evidence, His
Honour Judge Dureault, of the County Court Judges' Criminal
Court of St. Boniface, convicted Brian L. Aimonetti as
charged. Copies of the Certificate of Conviction dated Febru-
ary 19, 1980 and the Reasons for Judgment of His Honour
Judge A. Dureault, delivered on January 10, 1980, are attached
hereto and marked respectively as Exhibits "A" and "B" to this
my Affidavit.
7. On January 23, 1980, Judge Dureault sentenced Brian L.
Aimonetti to a period of incarceration of two years less one
day.
8. Pursuant to an Application for Restoration dated March 7,
1979, a hearing was held before His Honour Judge Kopstein, of
the Winnipeg Provincial Judges' Court (Criminal Division) on
April 1, 1980. A copy of the Notice of Application for Restora
tion dated March 7, 1979 is attached hereto and marked as
Exhibit "C" to this my Affidavit.
9. After hearing the evidence of Brian L. Aimonetti, and of the
Crown, His Honour Judge Kopstein dismissed Mr. Aimonetti's
Application for Restoration. A copy of the transcript of evi
dence and proceedings of the Application for Restoration heard
on April 1, 1980 is attached hereto and marked as Exhibit "D"
to this my Affidavit.
10. Pursuant to an Originating Notice of Motion dated April
29, 1979 [sic] and filed in the Court of Queen's Bench, an
Application was made by Brian L. Aimonetti, for an Order of
Certiorari to quash the Order of His Honour, Judge Kopstein.
A copy of the Originating Notice of Motion for an Order of
Certiorari dated April 29, 1980, is attached hereto and marked
as Exhibit "E" to this my Affidavit.
11. Mr. Justice Wright of the Court of Queen's Bench dis
missed the Application on June 20, 1980, after hearing submis
sions by counsel for both Brian L. Aimonetti and for the
Crown. Copies of the Order dismissing the Application by Mr.
Justice Wright and the transcript of Reasons for Judgment,
both dated June 20, 1980, are attached hereto and marked as
Exhibits "F" and "G" respectively to this my Affidavit.
12. Pursuant to a Notice of Appeal dated July 17, 1980, Brian
L. Aimonetti appealed the decision of Mr. Justice Wright to
the Manitoba Court of Appeal. A copy of the Notice of Appeal
of Brian L. Aimonetti dated July 17, 1980, is attached hereto
and marked as Exhibit "H" to this my Affidavit.
13. The Manitoba Court of Appeal heard the Appeal on
December 10, 1980, and on January 28, 1981, delivered written
Reasons dismissing Brian L. Aimonetti's Appeal from the
decision of Mr. Justice Wright. A copy of the decision of the
Manitoba Court of Appeal reported at 8 M.R. (2nd) 271 is
attached hereto and marked as Exhibit "I" to this my
Affidavit.
14. That shortly thereafter, Brian L. Aimonetti made applica
tion for leave to appeal the decision of the Manitoba Court of
Appeal to the Supreme Court of Canada. Copies of the Memo
randums of Argument filed on behalf of Brian L. Aimonetti
and Her Majesty the Queen in the Supreme Court of Canada
are attached hereto and marked as Exhibits "J" and "K"
respectively to this my Affidavit.
15. The motion of Brian L. Aimonetti for leave to appeal from
the judgment of the Manitoba Court of Appeal dated January
28, 1981 was heard by the Supreme Court of Canada on
Monday, April 27, 1981 and dismissed. A copy of the minutes
of judgment settled on December 7, 1981 is attached hereto
and marked as Exhibit "L" to this my Affidavit.
Aimonetti and one James Aiken McMullen
were charged with unlawfully possessing a narcotic
to wit: Cannabis resin for the purpose of traffick
ing, contrary to the provisions of the Narcotic
Control Act [R.S.C. 1970, c. N-1] and amend
ments thereto. On January 10, 1980, both accused
were tried upon the charge aforementioned. Aimo-
netti was found guilty of the offence and McMul-
len was acquitted. On January 23, 1980, Aimonet-
ti was sentenced to be imprisoned in a correctional
institution in Manitoba for a term of two years less
one day.
No appeal was taken by Aimonetti from the
conviction made by Judge Dureault.
As set out in MacFarlane's affidavit, an applica
tion for restoration of the monies seized, made by
the plaintiff and his wife, was heard on April 1,
1980, by Provincial Court Judge Robert Kopstein.
At the commencement of the hearing, Mr.
Norman Cuddy, a barrister who had appeared for
the Aimonettis at the proceedings before Judge
Dureault, informed the Court that Mr. Aimonetti
advised him he wished to represent himself at the
hearing and accordingly asked leave of the Court
to withdraw. Questioned by the Court, "That is
your wish?", the plaintiff replied in the affirma
tive. Mrs. Aimonetti, who claimed the return of
$200 seized, was present in Court.
Following hearing of the evidence, the Court
addressed plaintiff as follows:
THE COURT: The money is a lot of money and I have listened
to your evidence and the other evidence as sympathetically as
possible for I would like to be able to try and make an Order
returning it to you, but your story does not persuade me, or
satisfy me, that this money was unassociated, or not associated,
with the sale of drugs. Some of it was actually contaminated
with cannabis resin. The gloves that were found were con
taminated. You had, according to your own evidence, or
according to the statement that you made, $7,000.00 to—no,
it's not your evidence. You had the money to buy this three
pounds, which according to the estimate of Storey, is worth
about $7,000.00. Even if you got it for less than that, wherever
you got, it is still a sizable amount of money. You're a person,
Mr. Aimonetti, who has lived on the fringes of the law, and
now you want me to believe that these sums of money, these
large sums that were found and kept in a house, or in an
apartment, were earned through gambling, through legal
sources. There is no one, and you must have had contact or
associations with people, there is no one that can come and
corroborate that.
And further in his judgment he said:
I doubt the evidence; your evidence does not satisfy me, Mr.
Aimonetti, that this money was not associated with the drug
trade. I therefore deny your Application.
Mrs. Aimonetti's application for the return of
the $200 seized was granted, the judge stating:
I am prepared to accept that it was her pay cheque from
Safeway and to make an Order for repayment of that, to repay
that sum to her.
It is common ground that the application by the
plaintiff and his wife was made pursuant to sub
section 10(5) of the Narcotic Control Act (the
"Act").
A motion for a writ of certiorari brought before
Mr. Justice W. Scott Wright of the Manitoba
Court of Queen's Bench was dismissed.
In his reasons for judgment dismissing the
motion, Justice Wright said in part:
As part of the record before me, as I have said, I was invited
by both counsel to read the transcript of the proceedings before
Provincial Judge Kopstein, which contains the evidence
adduced before him and his reasons for decision. It was under
stood that I would read this transcript in context that this is a
certiorari motion before me, and I have done so. I find nothing
in the transcript to lead me to conclude the learned Provincial
Judge failed to examine the question in issue properly and
fairly, or that there was no evidence or no basis from the
evidence for arriving at his decision. In fact, in my view, there
was ample evidence for him to assess, which he did unfavour
ably from the Applicant's point of view, which presumably lead
the learned Judge to the conclusion the monies sought were
more probably the result of or related to crime and thus by
policy of the law could not be restored to the Applicant.
As further set out in the affidavit of MacFar-
lane, the plaintiff appealed the decision of Wright
J. to the Manitoba Court of Appeal. The majority
judgment was delivered by Huband J.A., con
curred in by Freedman C.J.M., R. v. Aimonetti
(1981), 8 Man.R.(2d) 271. One of the arguments
raised on behalf of the accused on the appeal was
that at the hearing where the restoration applica
tion was considered, the Crown failed to prove that
the initial seizure of cannabis resin, the cash and
other things, was done under the authority of a
writ of assistance or a warrant issued under sub
section 10(1) (of the Act) and that, accordingly,
Kopstein P.C.J. lacked the jurisdiction to make
any order other than one which would restore the
property to the plaintiff. On this point, at page
276, Mr. Justice Huband said:
It should be noted that during his trial leading to his
conviction, the accused raised no challenge of the search and
seizure of his residence. Nor was the issue raised before Kop-
stein, P.C.J. It was raised for the first time on the motion for
certiorari before Wright, J., unaccompanied by any evidence on
the matter, and the argument is now repeated before this court.
The issue not having been raised before him, in my view
Kopstein, P.C.J., was entitled to assume the validity of the steps
taken by the police prior to trial,—and so was Wright, J.,—and
so is this court. Omnia praesumuntur esse rite acta,—all things
are presumed to have been rightly done.
Dealing with the question of possession to the
money in question, the learned Justice of Appeal,
at paragraph 23 said [at page 2781:
Where the property in question is money, the claim for
restoration of possession will not be allowed if the cash appears
to be the fruits of illegal trade in narcotics. The scheme of the
Act is to deny possession of such funds to one accused and
subsequently convicted of participating in illegal trade, (subject
to that person's right to claim ownership in separate civil
proceedings). It would be contrary to the scheme of the Act to
allow restoration on the limited ground that the money could
not be identified in a transaction with the specific narcotic
found on the premises. In my opinion, Kopstein, P.C.J., had the
jurisdiction to deny the application for restoration in spite of
the fact that the money in question was not directly identified
as flowing from a transaction involving the cannabis resin
seized from the premises. So long as there was evidence upon
which he could reasonably conclude that the money resulted
from illegal trade in narcotics, he was entitled to treat such
money as a thing "in respect of which ... an offence ... has
been committed", to borrow from the language employed in s.
10(1)(c).
In any event, there was an abundance of evidence before him to
justify his final conclusion that the money found in the resi
dence (apart from Mrs. Aimonetti's $200.00) was associated
with the illicit sale of drugs. [Emphasis added.]
And after an extensive review of the evidence in
the hearing before Kopstein P.C.J., Huband J.A.,
at page 280, concluded:
There can be little wonder that the learned trial judge
concluded that the money in question was the fruit of illicit
trading in drugs.
Repeating from the affidavit of MacFarlane, the
motion by the plaintiff for leave to appeal to the
Supreme Court of Canada was refused.
I have quoted at some length from the order of
Kopstein P.C.J., the judgments of Wright J. and of
Huband J.A. to emphasize that the basis of Judge
Kopstein's ruling refusing the order of restoration
of the money seized was his finding that those
monies were associated with the drug trade, and
that this finding was approved in the certiorari
proceedings. To repeat from what I have already
quoted, Huband J.A. said at page 278:
In any event, there was an abundance of evidence before him to
justify his final conclusion that the money found in the resi
dence (apart from Mrs. Aimonetti's $200.00) was associated
with the illicit sale of drugs.
But nowhere in the order of Kopstein P.C.J., or
in the certiorari proceedings, was there any finding
that the monies seized were used for the purchase
of the narcotics seized.
The Act, in section 4(1), (2) and (3) and in
section 10(1)(a), (b) and (c), and (5), (6), (7) and
(8) provides:
4. (1) No person shall traffic in a narcotic or any substance
represented or held out by him to be a narcotic.
(2) No person shall have in his possession any narcotic for
the purpose of trafficking.
(3) Every person who violates subsection (1) or (2) is guilty
of an indictable offence and is liable to imprisonment for life.
10. (1) A peace officer may, at any time,
(a) without a warrant enter and search any place other than
a dwelling-house, and under the authority of a writ of
assistance or a warrant issued under this section, enter and
search any dwelling-house in which he reasonably believes
there is a narcotic by means of or in respect of which an
offence under this Act has been committed;
(b) search any person found in such place; and
(c) seize and take away any narcotic found in such place,
any thing in such place in which he reasonably suspects a
narcotic is contained or concealed, or any other thing by
means of or in respect of which he reasonably believes an
offence under this Act has been committed or that may be
evidence of the commission of such an offence.
(5) Where a narcotic or other thing has been seized under
subsection (1), any person may, within two months from the
date of such seizure, upon prior notification having been given
to the Crown in the manner prescribed by the regulations,
apply to a magistrate within whose territorial jurisdiction the
seizure was made for an order of restoration under subsection
(6).
(6) Subject to subsections (8) and (9), where upon the
hearing of an application made under subsection (5) the magis
trate is satisfied
(a) that the applicant is entitled to possession of the narcotic
or other thing seized, and
(b) that the thing so seized is not or will not be required as
evidence in any proceedings in respect of an offence under
this Act,
he shall order that the thing so seized be restored forthwith to
the applicant, and where the magistrate is satisfied that the
applicant is entitled to possession of the thing so seized but is
not satisfied as to the matters mentioned in paragraph (b), he
shall order that the thing so seized be restored to the applicant
(c) upon the expiration of four months from the date of the
seizure, if no proceedings in respect of an offence under this
Act have been commenced before that time, or
(d) upon the final conclusion of any such proceedings, in any
other case.
(7) Where no application has been made for the return of
any narcotic or other thing seized under subsection (1) within
two months from the date of such seizure, or an application
therefor has been made but upon the hearing thereof no order
of restoration is made, the thing so seized shall be delivered to
the Minister who may make such disposition thereof as he
thinks fit.
(8) Where a person has been convicted of an offence under
section 3, 4 or 5, any narcotic seized under subsection (1), by
means of or in respect of which the offence was committed, any
money so seized that was used for the purchase of that narcotic
and any hypodermic needle, syringe, capping machine or other
apparatus so seized that was used in any manner in connection
with the offence is forfeited to Her Majesty and shall be
disposed of as the Minister directs.
I am not quoting subsection (9). It has no rele
vance in the within action.
The word "thing", as used in the various subsec
tions of section 10, includes "money": see Smith v.
The Queen, [1976] 1 F.C. 196; 27 C.C.C. (2d) 252
(T.D.), a decision of Mr. Justice Addy of the
Federal Court, Trial Division, which decision I
shall refer to in more detail later.
Subsection 10(8) applies only if the monies
seized were used for the purchase of "that narcot
ic" which was the subject-matter of the offence for
which the plaintiff had been convicted. In that
event, the monies would be forfeited to Her Majes
ty and disposed of as the Minister directs. But
such is not the case here. As already pointed out,
there is no finding the monies seized were used for
the purchase of that narcotic. In fact, it is clear
that the monies were not used for that purchase. If
so used, they would no longer be in the possession
of the plaintiff at the time of seizure.
Subsection 10(7) is the governing section to be
considered here. No right of forfeiture can be
imported to that subsection, and accordingly the
provision therein that "the thing so seized [and as
pointed out earlier, `thing' includes `money] shall
be delivered to the Minister who may make such
disposition thereof as he thinks fit" merely makes
the Minister a custodian over said money and does
not empower him to decide any question of title to
it. The decision as to title to the property falls to
be determined in civil proceedings.
In arriving at the conclusion, I find support in
what was said by Addy J., in Smith v. The Queen,
supra. The pertinent facts in that case are not
dissimilar to those in the within case, save that in
Smith, no application for restoration was made
under subsection 10(5) and the case proceeded on
an agreed statement of facts filed, showing the
accused had been charged and eventually pleaded
guilty to possession of a narcotic for the purpose of
trafficking, contrary to subsection 4(2) of the Act.
At the time of the accused's arrest, the sum of
$5,030 was found on his person and the sum of
$8,090 was found on the premises occupied by
him. Both sums were seized by the R.C.M.P.
under and by authority of a writ of assistance and
were admitted as exhibits at the accused's trial. At
page 197 [Federal Court Reports] of the judg
ment, Addy J. said:
Although not specifically stated in the agreed statement of
facts, at the hearing before me counsel for both parties were in
agreement that there was no dispute as to the fact that the
plaintiff was, at the time of the seizure, the owner of the sum of
$13,110 above referred to. There was no evidence or finding
whatsoever that the monies were in any way related to or used
in connection with the offence to which the accused pleaded
guilty.
An application to the Minister for a return of
the monies seized was refused and the issue was
whether the plaintiff, not having made application
for return of the monies seized under subsection
10(5) could now bring an action for the return to
him of the monies seized or whether subsection
10(7), in effect, operated as a forfeiture of the
monies to the Crown.
An application was originally made to the Fed
eral Court of Appeal under section 28 of the
Federal Court Act, R.S.C. 1970 (2nd Supp.), c. 10
for a review of the decision of the Minister under
which he directed the monies be disposed of by
depositing the sum to the account of the Receiver
General. At pages 198-199 the learned Trial Judge
said:
By judgment dated the 25th of October, 1974 ([1974] 2 F.C.
43), the Federal Court of Appeal dismissed the plaintiffs
application on the grounds that the direction of the Minister
under section 10(7) of the Narcotic Control Act was not a
decision required by law to be made on a judicial or on a
quasi-judicial basis and was therefore not reviewable under
section 28 of the Federal Court Act; the Court also held that
the Minister's power under that subsection as well as under
subsection 10(8), to which I shall refer, was merely custodial
and was not a power to decide any question of title to property.
It appears evident that section 10(7) does not constitute a
limitation section which will bar a right of action for recovery,
for, in order to constitute a procedural limitation of a right of
action, the section must clearly state so.
And continuing on pages 199-200, Addy J. sets
out:
As stated by the Court of Appeal in the former hearing in
the present case, the Minister's power under section 10(7) (as
well as under section 10(8)) is merely custodial and does not
decide any question of title to property.
If, in order to create a procedural bar to an action, the
statute must clearly state so, a fortiori, any statute under which
the Crown claims that an absolute right to property has been
extinguished and forfeited to it, must clearly state so. The
relevant portions of section 10(8) read as follows:
(8) Where a person has been convicted of an offence under
section ... 4 ... any money so seized that was used for the
purchase of that narcotic ... is forfeited to Her Majesty and
shall be disposed of as the Minister directs.
It is obvious that section 10(8), in addition to providing that the
Minister may direct the disposition of money seized, specifical
ly stipulates that any money seized which was used for the
purchase of a narcotic is forfeited to Her Majesty. This is the
only case where any provision is made as to forfeiture of monies
and it is clear from the admitted facts, in the case at bar, that
the monies in question were not so used. Altogether apart from
the principle that if a statute purporting to forfeit a property
right must specifically state so, in view of the specific provisions
as to forfeiture in subsection (8), I must conclude that subsec
tion (7) does not in any way provide for the forfeiture of any
property right or any right to possession since no forfeiture is
mentioned in that subsection. Thus, the discretion of the Minis
ter in that particular subsection is subject to any property
rights of persons interested in the "thing" seized. [Emphasis
added.]
And further at page 201, Mr. Justice Addy added:
It seems quite clear to me that subsections (5) and (7) of
section 10 are merely procedural and custodial. They provide a
ready mechanism for a person to obtain by some re-application
the return of anything which has been seized and also provide
for the custody of same in the event of any application not
being made or in the event of the application being denied.
They do not either explicitly or by necessary implication cause
any property right to be forfeited.
I might add that if, in enacting these subsections, the Parlia
ment of Canada did purport to provide that any money whatso
ever, seized in a police raid under the Narcotic Control Act,
including money which is not eventually connected with the
commission of a criminal offence, would be forfeited to the
Crown in the right of Canada in the event of an application not
being made for the return of same within two months, then,
these provisions would be ultra vires as infringing on the
property and civil rights jurisdiction of the provinces. [Empha-
sis added.]
I am respectfully in full agreement with the
decision of Mr. Justice Addy. The fact that the
plaintiff made application for restoration of the
monies under subsection 10(5) of the Act does not
affect or limit his right to proceed by way of civil
proceedings in this Court to adjudge that he is the
owner of and has title to the monies claimed by
him in his pleadings and to order the return of said
monies to him. Question 1 in plaintiff's notice of
motion is answered in the affirmative.
Having so held, I question the necessity of deter
mining the second question of law in the motion,
namely, is the plaintiff estopped from seeking the
return of the monies in respect of which the order
for restoration was refused and the issue is, there
fore, res judicata, but in view of the fact that this
question was posed "in the alternative", I feel it
may be as well if I deal with it.
The issue of estoppel is clearly defined in the
decision of Lord Guest in Stiftung v. Rayner &
Keeler Ltd. (No. 2), [1967] 1 A.C. 853 (H.L.) at
page 935 (quoted by Dickson J., in the Supreme
Court decision of Angle v. Minister of National
Revenue, [1975] 2 S.C.R. 248 at page 254), as:
... (1) that the same question has been decided; (2) that the
judicial decision which is said to create the estoppel was final;
and, (3) that the parties to the judicial decision or their privies
were the same persons as the parties to the proceedings in
which the estoppel is raised or their privies.
In McIntosh v. Parent, [1923-24] 55 O.L.R. 552
(C.A.), Middleton J.A., speaking for the Court, at
page 555 defined res judicata thusly:
When a question is litigated, the judgment of the Court is a
final determination as between the parties and their privies.
Any right, question, or fact distinctly put in issue and directly
determined by a court of competent jurisdiction as a ground of
recovery, or as an answer to a claim set up, cannot be re-tried
in a subsequent suit between the same parties or their privies,
though for a different cause of action. The right, question, or
fact, once determined, must, as between them, be taken to be
conclusively established so long as the judgment remains.
[Emphasis added.]
Res judicata was also carefully canvassed in the
Town of Grandview v. Doering, [ 1976] 2 S.C.R.
621. Ritchie J., delivering the majority judgment
of the Supreme Court of Canada, at page 634
quoted with approval from the judgment of Chief
Justice Dewar of the Manitoba Court of Queen's
Bench, where he said:
Later in his judgment, Chief Justice Dewar cited the cases of
Henderson v. Henderson ((1843), 3 Hare 100) and Ord v. Ord
([1923] 2 K.B. 432) and quoted the following passage from
Vice-Chancellor Wigram's reasons for judgment in the former
case at p. 115:
... I believe I state the rule of the Court correctly when I say
that, where a given matter becomes the subject of litigation
in, and of adjudication by, a Court of competent jurisdiction
the Court requires the parties to that litigation to bring
forward their whole case, and will not (except under special
circumstances) permit the same parties to open the same
subject of litigation in respect of matter which might have
been brought forward as part of the subject in contest, but
which was not brought forward, only because they have,
from negligence, inadvertence, or even accident, omitted part
of their case. The plea of res judicata applies, except in
special cases, not only to points upon which the Court was
actually required by the parties to form an opinion and
pronounce a judgment, but to every point which properly
belonged to the subject of litigation, and which the parties,
exercising reasonable diligence, might have brought forward
at the time.
Counsel for the plaintiff urged that the issue of
res judicata or estoppel could not be raised by the
defendant because it was not pleaded in the state
ment of defence.
Following completion of oral argument at the
hearing of the motion, I invited further submis
sions vis-a-vis the proper pleading of estoppel or
res judicata.
In Volume 2 of The Law of Civil Procedure by
Williston and Rolls, the following is found at page
704:
It is not necessary to plead res judicata in any special form
so long as the matter constituting the estoppel is stated in such
a manner as to show that the party pleading relies upon it.
And in Haynes v. Wilson et al., [1914] 6
W.W.R. 1495, Lamont J., speaking for the
Supreme Court of Saskatchewan sitting En Banc
at page 1496 put it thusly:
An estoppel must always be specially pleaded unless it appears
on the face of the adverse pleading or unless there was no
opportunity to plead it.
Plaintiff's counsel, in his written submission,
took the position that the Crown's statement of
defence did not disclose the defence of issue estop-
pel on the face of the pleadings and further sub
mitted that the Crown had full opportunity to
plead this defence. Paragraph 4 of the statement of
defence reads:
4. As to the Statement of Claim as a whole, the Defendant
says that on March 7, 1979, the Plaintiff initiated an applica
tion under Section 10(5) of the Narcotic Control Act, Revised
Statutes of Canada, 1970, Chapter N-1, (the Act), for restora
tion of the monies set out in Paragraph 3 of the Statement of
Claim. The Application was heard on April 1, 1980, by Kop-
stein, P.J.C., who held that the Plaintiff was not entitled to
possession of the said monies because he had failed to satisfy
the Court that these monies were not associated with his
criminal activities. The application was therefore dismissed and
the said monies delivered to the Minister of National Health
and Welfare, who in accordance with Section 10(7) of the Act,
"may make such disposition thereof as he thinks fit".
Defendant's counsel urged that the facts pleaded
clearly set out the defence of issue of estoppel or
res judicata and further in his submission added:
If Plaintiffs counsel is correct in his assertion, which is not
admitted but denied, the Crown would request leave to amend
its Statement of Defence nunc pro tunc to bring it into con
formity with the second issue raised on the fact of the Notice of
Motion by adding the following paragraph to the Statement of
Defence:
"4A. In the premises the Defendant says that the Plaintiff is
estopped in this action from seeking an order for the return
of the said monies on the ground that the issue has already
been determined by the presiding Provincial Judge, pursuant
to Section 10(5) of the Narcotic Control Act, Revised Stat
utes of Canada, 1970, Chapter N-1, and the issue is there
fore res judicata."
He further stated that if it was held that estoppel
or res judicata had not been pleaded, the Crown
would request leave "to amend the first line of
paragraph 5 of the Statement of Defence by
adding the word `further' after the word
Defendant".
Rule 420(1) and (2)(a) of the Federal Court
Rules provides:
Rule 420. (1) The Court may, on such terms, if any, as seem
just, at any stage of an action, allow a party to amend his
pleadings, and all such amendments shall be made as may be
necessary for the purpose of determining the real question or
questions in controversy between the parties.
(2) No amendment shall be allowed under this Rule
(a) except upon terms designated to protect all parties so far
as discovery and preparation for trial are concerned ....
Paragraph 5 of the statement of defence reads:
5. In the premises the Defendant says that even if the Plaintiff
is the "owner" of the monies set out in Paragraph 3 of the
Statement of Claim, which allegation is not admitted but
denied, an intervening right has been created in the Minister of
National Health and Welfare to divest the Plaintiff of such
ownership and accordingly, the said Minister is lawfully in
possession of these monies as against the Plaintiff and is not
creating any unlawful conversion as alleged or otherwise.
I believe paragraph 4 of the statement of
defence suffices to cover the plea of estoppel or res
judicata, but I would, nevertheless, allow the
amendments requested nunc pro tunc.
But does res judicata apply here? In denying
plaintiff's claim for the return to him of the
monies seized, the Provincial Court Judge dealt
with it only on the basis that the monies in ques
tion were associated with drug trafficking by the
applicant. In refusing the plaintiff's claim under
subsection 10(5), he did not purport to deal with,
nor was there before him, the issue of property or
ownership of the said monies. The only effect of
the decision refusing restoration was that the Min-
ister was entitled to possession of the monies and
plaintiff was not so entitled. It in no way dealt
with the issue of ownership.
This reasoning is supported in the Court of
Appeal judgment in Aimonetti, supra, where, at
page 277, Huband J.A. said:
Looking at section 10 in its totality, I think it is clear that the
authorities are entitled to seize cash, beyond that which may be
involved in a particular illicit transaction with respect to which
a charge is laid. Money actually used in the purchase of a
narcotic is to be forfeited to Her Majesty at the conclusion of a
trial, under subsection (8). The money we are now concerned
with falls in a different category. The scheme of the Act, as I
see it, allows police authority to seize property related to the
illicit trade in drugs, possession of which is then turned over to
the Minister unless the applicant is able to make out a case for
restoration. The procedures under s. 10 of the Act do not
constitute the Minister or the Crown as owner of the property
in question. The Minister becomes entitled to "possession", but
it is then open to the accused, or indeed anyone else, to advance
a civil claim for the recovery of the property from the Minister.
The issue in the within action is plaintiffs claim
that he is the owner of and has title to the monies
and that the Minister's power is merely custodial
and not a power to decide any question of title to
property. It becomes clear that the issue in the
proceedings before Kopstein P.C.J. and the issue
in the statement of claim are separate and distinct
and, accordingly, estoppel or res judicata do not
apply. Question 2, asked in the alternative in the
within motion, is answered in the negative.
The plaintiff will have costs of the motion.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.