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T-2838-83
Montreal Lithographing Ltd. (Applicant) v.
Deputy Minister of National Revenue for Customs and Excise, and Rupert J. King, es qualité, as Regional Collector of Customs and Excise for the Atlantic Region, and Camille Violette, es qualité, as collector of Customs and Excise for the Port of Edmundston in the Province of New Brunswick (Respondents)
Trial Division, Cattanach J.—Ottawa, December 15, 16, 1983 and January 6, 1984.
Customs and excise — Application for injunction against imposition of duties and invocation of Customs Act s. 102 for unpaid duties — Dispute as to Tariff classification — Application premature until acts attempted — Statutory appeals not exhausted — Provision for refund ensuring no irreparable, non-compensable harm — No violation of Charter s. 8 by s. 102 withholding of wares for duties currently or previously demanded — S. 8 prohibiting search or seizure in respect of person, not real or personal property — S. 102 providing for lien not seizure — Lien being right to retain possession of property until satisfaction of debt — Common meaning of "seizure" — "Seizure" term of art — Bona fide assertion of lien not "unreasonable" seizure — Lien long accepted in free and democratic societies — Application dis missed — Customs Act, R.S.C. 1970, c. C-40, s. 102 — Customs Tariff, R.S.C. 1970, c. C-41 — Canadian Charter of Rights and Freedoms, being Part I of the Constitution Act, 1982, Schedule B, Canada Act 1982, 1982, c. 11 (U.K.), s. 8 Federal Court Act, R.S.C. 1970 (2nd Supp.), c. 10, s. 18.
Constitutional law — Charter of Rights — Search or sei zure — Application for injunction — Withholding wares under Customs Act s. 102 for duties currently or previously demand ed not violating Charter s. 8 — S. 8 prohibiting search or seizure in respect of person, not real or personal property — Reasoning of Montgomery J. in Re Becker applied — S. 102 providing for lien not seizure — Meaning of "lien" in law — Common meaning of "seizure" — "Seizure" term of art — Bona fide assertion of lien not "unreasonable" seizure — Lien long accepted in free and democratic societies — Application dismissed — Customs Act, R.S.C. 1970, c. C-40, s. 102 — Canadian Charter of Rights and Freedoms, being Part I of the Constitution Act, 1982, Schedule B, Canada Act 1982, 1982, c. 11 (U.K.), s. 8.
Judicial review — Equitable remedies — Injunctions — Application for injunction against imposition of duties and invocation of Act s. 102 for unpaid duties — Application premature until acts attempted — Act providing sequence of appeals — Discretionary grant of injunction inexpedient in circumstances unless statutory options exhausted — Provision for refund of duties ensuring no irreparable, non-compensable harm — Application dismissed — Customs Act, R.S.C. 1970, c. C-40, s. 102 — Federal Court Act, R.S.C. 1970 (2nd Supp.), c. 10, s. 18.
CASES JUDICIALLY CONSIDERED
APPLIED:
Re Becker and The Queen in Right of Alberta (1983), 148 D.L.R. (3d) 539 (Alta. Q.B.).
COUNSEL:
J. R. Miller for applicant.
M. Y. Perrier and D. T. Sgayias for
respondents.
SOLICITORS:
Martineau Walker, Montreal, for applicant.
Deputy Attorney General of Canada for respondents.
The following are the reasons for order ren dered in English by
CATTANACH J.: For the reasons discussed at length during the hearing of this matter which counsel for the applicant has agreed should be considered as being an application exclusively for relief by way of injunction under section 18 of the Federal Court Act [R.S.C. 1970 (2nd Supp.), c. 10] and that Her Majesty the Queen and the Attorney General be deleted as parties, the application for the injunction was denied with costs to the respondents if demanded.
The dispute between the parties had been under what item of the Customs Tariff [R.S.C. 1970, c. C-41] goods imported fell, one of which contended for by the applicant attracted no duty whereas that contended for by the respondents did attract duty.
The applicant has paid the duties exacted by the respondents so there is nothing which the respond ents can now be restrained from doing.
However the applicant seeks an injunction against the future imposition of such duties and the invocation of section 102 of the Customs Act [R.S.C. 1970, c. C-40] for unpaid duties on past importations. That is premature until sought to be done.
Because there is a statutory appeal procedure provided in the Customs Act through the depart mental hierarchy, then to the Tariff Board and from there to the Federal Court of Canada, if satisfaction is not obtained en route, it is con sidered inexpedient that discretionary relief by way of injunction in the present circumstances should be granted unless that right of appeal has first been exhausted.
Further should it be resolved at any stage of the appeal procedure which may be final that the wares were improperly classified the appeal proce dure provides for a refund of the whole or part of the duties exacted.
Therefore the plaintiff would not suffer irrepa rable harm not compensatable in damages.
These, in brief, were the paramount reasons for which the application for an injunction was denied at the conclusion of the hearing and an order to that effect endorsed on page 4 of the notice of motion.
The following is the addendum to reasons for order rendered in English by
CATTANACH J.: In the anxiety to summarize and expedite the reasons discussed at the hearing of the application for an injunction in this matter to writing, specific mention was not made of the serious contention advanced and seriously argued on behalf of the applicant and of the reasons given for not accepting that contention at the hearing.
The contention so advanced was that the respondents by invoking section 102 of the Cus toms Act by withholding the release of wares
imported by the applicant until payment of an indebtedness alleged to be payable with respect to previously imported wares by the applicant or because a refusal by the respondents to release imported goods until duties were paid which were imposed thereon, contrary to the contention of the applicant that the goods were duty-free, would amount to an "unreasonable seizure" of the goods contrary to the guarantee of rights against "unrea- sonable search or seizure" in section 8 of [the Canadian Charter of Rights and Freedoms, being Part I of] the Constitution Act, 1982 [Schedule B, Canada Act 1982, 1982, c. 11 (U.K.)].
The reasons for not accepting that contention on behalf of the applicant were threefold, the first of which was predicated upon the adoption of the reasoning by Montgomery J. in Re Becker and The Queen in Right of Alberta (1983), 148 D.L.R. (3d) 539 (Alta. Q.B.), to the effect that the free dom from unreasonable search or seizure so guar anteed in section 8 of the Charter of Rights and Freedoms was applicable to search or seizure in respect of the person and not as to real property.
While Mr. Justice Montgomery directed his rea soning to real property, that reasoning in my view applied with equal logic to personal property.
The second reason was that while the word "seizure" in common parlance means the confisca tion or forcible taking possession of lands or goods, it is a term of art in law. The right granted in section 102 of the Customs Act to the Crown is a lien upon the wares. In law a lien is a right to retain possession of property until a debt due to the person detaining the property is satisfied. In my view there is a substantial difference between a "seizure" and a "lien" from which it follows that said section 8 of the Charter in which section specific reference is made to "unreasonable search or seizure" does not apply to a "lien".
Thirdly, assuming that not to be so, which assumption I did not accept, the bona fide invoca tion of a lien (as was here the case) does not amount to an "unreasonable" seizure.
The concept of a lien on goods for the security of the supplier of services or repairs has been in effect in the common law for at least five centuries.
The common law in this respect has been repeat ed in legislation in Canada, an example of which is found in mechanics' liens, which can be a charge on real property for work done with respect there to, or by which a repairman may retain possession of the wares until payment for that repair service. If possession of the wares is surrendered the lien then fails. Similarly, there are the further exam ples of an innkeeper's lien, and a warehouseman's lien amongst others. Thus it is a very reasonable concept accepted from time immemorial in free and democratic societies.
It was for these reasons that the contention that section 102 of the Customs Act was inoperative as being in conflict with section 8 of the Charter of Rights and Freedoms was not accepted.
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