2014 QCCA 503, 2014 QCCA 503

C.C. Havanos Corporation c. R. 2014 QCCA 503 COURT OF APPEAL CANADA PROVINCE OF QUEBEC REGISTRY OF MONTREAL No: 500-09-022892-129 (500-05-049776-998) MINUTES OF THE HEARING DATE: March 14, 2014 CORAM: THE HONOURABLE FRANÇOIS PELLETIER, J.A. YVES-MARIE MORISSETTE, J.A. GUY GAGNON, J.A. APPELLANTS ATTORNEY(

S) C.C. HAVANOS CORPORATION DINO ORSINI LOUISE LEMIRE ORSINI IAN ORSINI Mtre Bruce Taub Mtre Alan M. Stein Exellence Partner Canada Inc. RESPONDENTS ATTORNEY(

S) HER MAJESTY THE QUEEN MARC ARCHAMBAULT LYNNE FILION Mtre Jacques Savary Ministère de la Justice Canada

On appeal from a judgment rendered on June 20, 2012, by the Honourable Justice Jean- Jude Chabot, of the Superior Court, District of Montreal. NATURE OF THE APPEAL : Liability of the Crown – Seizure and forfeiture - Excise Act Clerks: Marcelle Desmarais Courtroom: Antonio-Lamer HEARING Continuation of the hearing of March 12, 2014. Judgment – see page 3. Marcelle Desmarais Clerk BY THE COURT JUDGMENT

[ 1 ] The appeal is from a judgment of the Superior Court, District of Montreal (the Honourable Jean-Jude Chabot), [1] which on June 20, 2012, dismissed an action in damages in which the appellants’ total claim against the respondents was for an amount of $9,000,000 plus interests, the additional indemnity and the amounts incurred by the appellants in legal fees. The crux of the appellants’ case was that, in seizing and retaining certain assets of C.C.

Havanos Corporation (“Havanos”), a business controlled by the members of the Orsini family, and in failing to issue appropriate licences promptly to Havanos under the Excise Act , R.S.C.1985, c. E-14, the respondents had effectively caused the ruin of Havanos and inflicted personal damages to the other appellants.

Havanos at the time was involved in the business of importing tobacco from the Republic of Honduras and of manufacturing and selling high end cigars in the City of Montreal. [ 2 ] As their counsel asserted during the hearing of the appeal, the respondents never questioned the appellants’ good faith in the proceedings heard in the Superior Court.

Their position was and remains that, in starting and operating their business, they had been seriously misinformed by the consultant they had hired, particularly in that he had led them to believe that no licences were required under federal legislation to have the kind of commercial activities which Havanos was beginning to engage in. As far as this aspect of the case is concerned, the trial judge shared the respondents’ view, and there is no reason to suppose that they were mistaken on this count. [ 3 ] The appellants take issue with certain findings of fact of the trial judge and they contend (

i) that the source of the misinformation which ultimately resulted in a search, a seizure and their arrest on Havanos’ premises, was a civil servant employed by the Crown, and (ii) that the search, which was of dubious legality and conducted in an abusive manner, was the initial cause in the failure of Havanos as a business. [ 4 ] It should be noted first that the factual determinations of the trial judge in this case cannot be undone simply by pitting against the findings of fact made in the Superior Court in the context of what was action in damages, other and different findings of fact made by the Court of Québec in the context of a prosecution under the Excise Act .

Even when the clarifications spelled out in paragraphs [44] to [58] of the Court’s judgment in the case of Solomon v.

Québec (Procureur général) [2] are borne in mind, the fact remains that a judgment of acquittal in criminal or penal proceedings cannot in and of itself defeat conflicting findings of fact in a parallel or subsequent civil trial. [ 5 ] In this instance, the appellants Dino and Ian Orsini, who had been charged with offences under the Excise Act (namely, manufacturing and being in possession of cigars without a licence), were tried in the Court of Québec [3] and benefitted from a nolle prosequi or stay of proceedings when the trial judge accepted their defence of officially induced error of law.

But on a parallel course, the Federal Court of Canada confirmed in the Trial Division [4] and on appeal [5] the legality of the search and seizure conducted on Havanos’ premises.

And the trial judge in the civil action begun by the appellants was entitled to believe the witness Allard-Miller, a civil servant with Customs and Excise Canada, in preference to the appellants’ business consultant: nothing here could support a finding that the reasons given by the trial judge in paragraphs [56] to [58] of his judgment are undermined by a palpable and overriding error. [ 6 ] And in any event, it is apparent from the record of the case in the Superior Court that the facts described in paragraphs [89] to [93] of the judgment appealed from cannot be disputed.

Therefore, at the time it was instituted, the action of the appellants was already prescribed, or time-barred, pursuant to sections 82 and 83 of the Excise Act . [ 7 ] There is but one possible qualification to the rule contained in these latter provisions, and the trial judge explicitly refers to it when he mentions in paragraph [91] of his reasons “sauf pour ce qui constituerait pour eux une violation abusive et illégale de leurs droits constitutionnels”.

But none of the particular facts on which the appellants rely to base their claim under the Canadian Charter of Rights and Freedoms – which facts are set out in paragraph 49 of their factum – could by itself substantiate a valid claim of infringement of their constitutional rights. Nor can these facts substantiate the claim when they are considered together. What took place in August 1998 and later on the 14 th and 17 th of December of that same year was a normal and legal sequence of investigation, search, seizure and arrest.

The trial judge had reached this conclusion on his own and the appellants fail to show how in so doing he misdirected himself in law or in fact. [ 8 ] FOR THESE REASONS , the appeal is dismissed, with costs. FRANÇOIS PELLETIER, J.A. YVES-MARIE MORISSETTE, J.A. GUY GAGNON, J.A.