Breaking Fraud Cases from Canadian Courts
At Canadian Fraud News, we report on decisions issued by Canadian Courts related to fraud, that are not reported in the main stream media, and that contain legal issues the Canadian public and fraud recovery experts should be aware of. The following is one such story.
On January 12, 2018, Justice Patrick Murray of the Nova Scotia Superior Court of Justice released its decision on a judicial review of a decision of the Crown Attorney of Nova Scotia to stay a private prosecution for fraud brought by Mr. Jeremy Pike.
In cases where a private citizen (as opposed to the Attorney General) wishes to conduct a private prosecution, a provincial court judge is required to hold what is referred to as a “pre-enquete hearing”. Mr. Pike asked the Superior Court to review the decision of the Honourable Provincial Court Judge Richard MacKinnon who stayed his case.
Private prosecutions for fraud are rare. We are not aware of any case where the Courts have allowed a fraud complaint to be prosecuted privately. Unfortunately the reviewing court did not provide particulars of the complaint. The following facts are important to this story:
The Private Prosecution Process
On October 13, 2016, Mr. Pike first appeared in Provincial Court. He was properly given direction by the court as to the procedure in laying a private information. He was further advised it would be beneficial to consult legal counsel for further advice as to his intended private prosecution.
On November 4, 2016, Mr. Pike next appeared in Provincial Court. On that date he swore an information to charge a private individual. The name of this individual was not released. The charge alleged was fraud less than $5,000 contrary to s. 380(1)(b) of the Criminal Code.
At the hearing on November 4, 2017, Mr. Pike was accompanied by his counsel Mr. Wayne MacMillan. The hearing was adjourned to November 25, 2017, as the Crown sought time to investigate Mr. Pike’s complaint.
On November 25, 2017, Mr. MacMillan appeared on behalf of Mr. Pike. On this occasion Crown Attorney informed the Court that the Crown wished to enter a stay of proceedings. This was to be on an interim basis, pending review and possible intervention by the Attorney General, through the Public Prosecution Service. The matter was next scheduled for February 21, 2017.
On February 21, 2017, Ms. Kathy Pentz appeared for the Crown. She was the Regional Crown Attorney. This was a substantial hearing in the sense that both Ms. Pentz and Mr. Pike made submissions to the Court.
Ms. Pentz stated the Crown had reviewed the matter and were intending to intervene and entering a stay. Ms. Pentz informed the Court that Mr. Martin Herschorn, the Chief Crown Attorney for the Province, would provide advice to the Attorney General and Mr. Pike would be advised in writing.
Mr. Pike made submissions to the Court on February 21, 2017. His argument in part is as follows:
[While] the Criminal Code is statutory, the right to privately prosecute is common law. It’s a right that’s existed for centuries. It has, in one form or another, existed since before the Magna Carta. Indeed, justice normally was exacted by citizens, not by the Crown. The Crown Prosecution Service didn’t even develop until the 15th century, and, at that stage, the Crown was an agent for a sovereign matter.
Obviously, since then times have changed, laws have evolved and so has society. There is a greater need for the Crown to play a role. However, for the Crown to intervene without giving a citizen of this county the right to at least present his evidence and have the charges considered, have evidence heard by witnesses and have an impact, when the prosecutor himself has also been a victim, I believe, is a gross departure from just process.
It’s not Parliament intended when they wrote the statutes or enacted the Criminal Code in 1955. Their intention was not to supersede common law. It was to complement it.
In response Ms. Pentz for the Crown stated it reviewed a great deal of material including the police investigation. They further reviewed the documentation provided by Mr. Pike’s counsel, Mr. MacMillan, and his position on the validity of the charge. Ms. Pentz informed the Court that the Crown had proceeded with its analysis assuming the facts as stated by Mr. Pike could be proven.
Ms. Pentz for the Crown was of the view that the evidence did not establish a charge in law. While conceding that Mr. MacMillan held a different view, the Crown advised the Court they were maintaining this position. The Crown was of the view that there was no public interest in proceeding with this matter.
On June 20th the Provincial Court ruled as follows:
Its my view that the Crown is permitted and can enter a stay of proceedings at this point in time, even though the hearing has not been held to determine whether or not there is a prima facie case and to determine whether or not process should issue.
The Criminal Code, in my view, allows the Crown to enter a stay of proceedings at any point in the proceedings and they have indicated that they are entering a stay of proceedings at this point in time.
I do not have the right to require the Crown to do anything else after they have entered a stay of proceedings, and I do not have the right to require the Crown to participate or require the Crown to wait until a hearing is held before entering a stay of proceedings. In my view, there is nothing further to discuss.
Arguments of the Private Citizen on Appeal / Review
Mr. Pike argued s. 507.1(3)(a) makes the introduction of “evidence of witnesses” mandatory. Mr.
Pike maintains the Provincial Court’s failure to allow him to call evidence is a violation of procedural fairness as per the s. 507.1 requirements that are set out in the Code. In addition to being procedurally unfair, Mr. Pike submitted that allowing the stay to be entered before the mandatory pre-enquete hearing, created an unequal application of the law in these given circumstances.
The result, he argued, was a denial of natural justice that includes the right to be heard. Mr. Pike submitted the unfairness or inequity occurs when the proceeding is stayed before due process. Due process he says, is paramount should apply not only to an alleged accused, but to the private citizen as well.
The Court noted that what Mr. Pike really sought was the remedy of mandamus – what is known as a prerogative writ. It is an extraordinary remedy available when a judge (or Court) acts outside its jurisdiction, either by refusing to exercise its jurisdiction or by the judge or court exceeding its jurisdiction. It is not available for example, simply because a judge may have been in error or was wrong about a decision
For mandamus to issue, the reviewing court is not so concerned with the correctness of the decision. The concern is more whether the court below acted within its authority. Mr. Pike does not dispute the Crown’s authority to enter a stay of proceeding. His issue is that the hearing must take place in order that due process will be accorded to both the Crown and the private prosecutor.
In this way, Mr. Pike sought accountability within the administration of justice. Mr. Pike submitted that requiring the judge to proceed with the hearing ensures a just system and preserves the integrity of private prosecutions. This is the way this matter should have proceeded. Instead, the Court accepted the stay entered by the Crown.
The Disposition of the Review Court
The Court held that Mr. Pike’s submissions are compelling in that they support an open and transparent approach. He argued that the unequal application of the law results in an unequal benefit to the Crown of s. 507.1.
The Court held that if one accepts that the Crown has the right to stay proceedings, the question boils down to when is it appropriate for the judge to permit or allow a stay of proceedings to be entered.
The Court noted that a plain reading s. 579(1) of the Code informs us as to when, “the Attorney General or counsel instructed by him for that purpose may enter a stay”. It is “at any time after any proceedings in relation to an accused or a defendant are commenced, and before judgment.”
The Court held that a pre-enquete is not an adversarial proceeding. The person against whom the informant seeks to have process issued is not present and is not represented by counsel. The Attorney General is entitled to notice of the hearing, an opportunity to attend, to cross-examine and call witnesses and to present any relevant evidence at the pre-enquete without being deemed to intervene in the proceeding.
The Court concluded that, as the remedy of mandamus is a discretionary one, there is no clear duty for the Court to conduct cross examinations of witnesses before a judge once the Attorney General intervened and decided to enter the stay of proceeding. The Court further held a judge is “functus” once a stay is entered, thereby preventing him or her from exercising further authority.
In sending a disappointing decision to Mr. Pike, the Court commended that he expressed himself eloquently. The Court stated:
He has shown himself to be a person of high intelligence. His ability to represent himself and present legal argument has been impressive. He is passionate to say the least about the matter before the Court, which has impacted him and his family. His and their life have been “on hold” while he has pursued “justice” in this matter.
The Reported Decision
The Court’s decision is reported at R. v Pike, 2018 NSSC 12, and at: https://www.canlii.org/en/ns/nssc/doc/2018/2018nssc12/2018nssc12.html?searchUrlHash=AAAAAQAYcGlrZSBwcml2YXRlIHByb3NlY3V0aW9uAAAAAAE&resultIndex=1
For further information on this case, or any other fraud recovery inquiry, contact Canadian Fraud News Inc. at Devin@Canadianfraudnews.com .
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Devin Jones is the head writer and social media producer at Canadian Fraud News. Devin was raised in Toronto and is a graduate of the Ryerson University journalism program. As a former Digital Media editor at the Ryerson Review of Journalism, you can find Devin camera and coffee in hand, at his home photo studio.