2011 QCCQ 15204, 2011 QCCQ 15204

Canada (Procureur général) c. Cortez 2011 QCCQ 15204 COURT OF QUEBEC CANADA PROVINCE OF QUEBEC DISTRICT OF HULL LOCALITY OF GATINEAU “Criminal and Penal Division” No. : 550-73-000005-083 DATE: December 7, 2011 ______________________________________________________________________ THE HONOURABLE RÉAL R. LAPOINTE, J.C.Q., PRESIDING ______________________________________________________________________ ATTORNEY GENERAL OF CANADA Applicant v.

MANUEL ENRIQUE CORTEZ Respondent and KARLA CECILIA CORTEZ Intervener ______________________________________________________________________ JUDGMENT ON MOTION FOR ORDER OF FORFEITURE OF PROCEEDS OF CRIME (ss. 462.37(1) and (2) of the Criminal Code ) AND ON THE APPLICATION OF A PERSON CLAIMING INTEREST FOR RELIEF FROM FORFEITURE (s. 462.42(1) of the Criminal Code ) ______________________________________________________________________ [ 1 ] The Court is seized of a motion for an order of forfeiture of proceeds of crime ( ss. 462.37(1) and (2) of the Criminal Code ). [ 2 ] The Court is also seized of an application of a person claiming interest for relief from forfeiture (s. 462.42(1) Cr.

C. ) The application was presented orally, and the Attorney General of Canada did not object. The application concerns only a portion of the amounts seized during two searches conducted simultaneously at two different addresses. It pertains only to the amount of $22,960 found in the closet of the master bedroom of the intervener, Karla Cecilia Cortez (hereinafter “Karla Cortez” or “Ms. Cortez”), at her residence at ..., Gatineau. She seeks an order that it be returned to her.

Facts [ 3 ] The facts of this case may be summarized as follows. [ 4 ] On January 20, 2009, the respondent Manuel Enrique Cortez pled guilty to the following four offences:

a) On or around January 16, 2008, in Gatineau, District of Hull, he unlawfully trafficked in a substance included in

Schedule I, or represented or held out to be such a substance, namely crack cocaine, contrary to section 5(1) of the Controlled Drugs and Substances Act , thereby committing the indictable offence set out at section 5(3)(

a) of the Act;

b) On or around January 16, 2008, in Gatineau, District of Hull, he unlawfully trafficked in a substance included in

Schedule I, or represented or held out to be such a substance, namely cocaine, contrary to section 5(1) of the Controlled Drugs and Substances Act , thereby committing the indictable offence set out at section 5(3)(

a) of the Act;

c) On or around January 23, 2008, in Gatineau, District of Hull, he unlawfully trafficked in a substance included in

Schedule I, or represented or held out to be such a substance, namely crack cocaine, contrary to section 5(1) of the Controlled Drugs and Substances Act , thereby committing the indictable offence set out at section 5(3)(

a) of the Act;

d) On or around January 23, 2008, in Gatineau, District of Hull, he unlawfully trafficked in a substance included in

Schedule I, or represented or held out to be such a substance, namely cocaine, contrary to section 5(1) of the Controlled Drugs and Substances Act , thereby committing the indictable offence set out at section 5(3)(

a) of the Act. [ 5 ] These offences are included in

section 462.37(2.02) Cr. C. , and as a result of Manuel Enrique Cortez’s conviction, the Court is required to order the forfeiture of property if it is satisfied that such property constitutes proceeds of crime obtained in relation to the perpetration of the designated offences. [ 6 ] Further to the issuance, on January 29, 2008, of a search warrant for the respondent’s family residence located at ..., in Gatineau (Quebec), executed on January 31, 2008, officers of the Royal Canadian Mounted Police (hereinafter the “RCMP”) seized, from inside

the residence, personal documents of the respondent found in the master bedroom and in a wallet belonging to him found in a room in the basement as well as several objects related to drug trafficking, namely:

a) three regular size Ziploc bags containing white residue;

b) a list of debts;

c) a cellular phone;

d) a money-counting machine;

e) a small Ziploc bag containing a white substance found in the above-mentioned wallet, which substance was later identified as cocaine by Health Canada. [ 7 ] The officers also seized the amount of $22,960 in various denominations of Canadian currency, divided into twenty-three packages, each wrapped in a regular size Ziploc-type bag, all of which was stuffed into a camera case. [ 8 ] The present matter is principally concerned with this amount, although other amounts were seized from the other residence searched, i.e ., apartment No. 45 located at ..., in Gatineau. This apartment was rented and inhabited exclusively by the respondent, Manuel Enrique Cortez. The following items were found:

a) the amounts of $101 in American currency and $45 in Canadian currency found in another wallet belonging to the respondent;

b) the amount of $2,700 in Canadian currency scattered in various locations throughout the master bedroom. [ 9 ] The application of a person claiming interest for relief from forfeiture on which the Court is asked to rule does not concern these latter two amounts. [ 10 ] Pursuant to sections 462.37(2.01) and 462.41(3) Cr. C. , the intervener has the burden of satisfying the Court that the amount at issue must be returned to her rather than being forfeited to Her Majesty. Analysis of the applicant’s evidence : [ 11 ] The evidence of the intervener, Karla Cortez, a third person for the purposes of

section 462.41 Cr. C. in relation to the Attorney General’s application for forfeiture, will be addressed below. It should, however, be noted at the outset that she made several admissions. She acknowledged that several elements of the evidence referred to in the Attorney General of Canada’s motion for an order of forfeiture are well founded (paragraphs 1 to 30 of the affidavit filed in support of the motion were admitted on May 10, 2010, when the hearing of this motion began). [ 12 ] The searches were conducted on January 31, 2008, in two separate residences, including ..., in Gatineau.

This address is described in the affidavit as [ translation ] “ … the respondent’s family residence”, referring to Manuel Enrique Cortez. This description was admitted (para. 17) although it is alleged that Mr. Cortez had recently taken up residence at a new address, i.e ., apartment No. 45 located at ..., in Gatineau, where the second search was conducted simultaneously. [ 13 ] Karla Cortez is the sister of the respondent, Manuel Enrique Cortez, who was sentenced by the undersigned on April 19, 2010 (written judgments 550-73-000005-083 and 550-01-034339-087).

I find that the respondent was still living with her, their mother, and a younger sister in the family residence, or at least also occupied this house, as several of his personal belongings were still there. Moreover, several objects related to drug trafficking were found there (para. 19). This element becomes particularly significant once one notes that nobody else living in this residence was at any time suspected of these narcotics offences. [ 14 ] It is worth mentioning that according to the evidence admitted by the parties, the money seized (the amount of $22,960) was concealed in a camera case.

The case was found in the closet (para. 21) of Karla Cortez’s bedroom, to which the accused would normally have had little access. [ 15 ] When an officer showed Karla Cortez the money in the minutes following its discovery during the search, however, she stated that the money did not belong to her. She emphasized her surprise, going so far as to ask where it had been found (para. 22). [ 16 ] Later on during her testimony, Ms. Cortez, without denying it, explained that the reason she first said that the money was not hers was because an officer had warned her that there would be consequences to her answer.

She says that she was not given the same warning in regard to the $2,000 found in her purse. [ 17 ] The officer in charge of the site where the search was conducted, Eric Lanteigne, denies having told Karla Cortez that there would be unfortunate consequences for her if she claimed that it was her money. He asserts that Ms. Cortez expressed concern solely for the money found in her wallet.

Moreover, she claimed only this small amount when she presented herself at the RCMP station a few days after the search, not the $22,960. [ 18 ] On another issue, and again in accordance with the admissions, eighteen banknotes given to the respondent, Manuel Enrique Cortez, or his accomplice, Martin Charbonneau, during transactions with an undercover agent in exchange for crack and/or cocaine were found in the above-mentioned amount.

The intervener sought to minimize the significance of this evidence, but the presence of these banknotes among the money claimed was not explained. [ 19 ] Moreover, it was admitted that during an analysis, Manuel Enrique Cortez’s fingerprints were found on one of the twenty-three Ziploc bags in which the banknote bundles were found. [ 20 ] Despite these admissions, the Attorney General called three RCMP officers to testify, and they confirmed having participated in

the investigation and/or search leading to the respondent’s conviction, in order to confirm the details appearing in the affidavit in support of the motion. [ 21 ] This evidence reveals several convincing elements leading to the conclusion that the significant sum of $22,960 belonged to none other than the offender who obtained it through the perpetration of the designated offences to which he pled guilty. [ 22 ] This is the logical conclusion one must draw when such a significant amount is found in cash, sheltered from banking transactions, in a house still visibly inhabited by a drug trafficker, in which he left significant personal items such as his wallet and a probation order, as well as an accounting list of debts and a bag containing drugs.

As if this was not already sufficiently conclusive, banknotes marked by the undercover agents were found in this significant sum of money stuffed into bags, on at least one of which the trafficker’s fingerprints were found. The evidence of the trafficker’s possession of this amount packaged in bundles, like the money found in his apartment, speaks volumes. It bears his signature. Assessment of the intervener’s testimony: [ 23 ] To counter this evidence, Karla Cortez explained that she has been the owner of this house, located at ..., in Gatineau, since 2006. Ms.

Cortez is only twenty-three years old and was living in this house with her mother, her younger sister, and her older brother, the trafficker, until he ran into trouble with the law. [ 24 ] Ms. Cortez explained that she arrived in Canada from Guatemala in 2001, at the age of nine or ten. Hard working from the beginning, she undertook francization courses, and barely a year after arriving in the country, she found work, including her first job as a bus person in a restaurant.

She kept this job for approximately nine years, mostly because the tips were so good, she explained. [ 25 ] The young women’s mother, who could not read or write, received social assistance. As she was also unable to count, the money left over after their household needs were met was placed in $1,000 bundles in Ziploc bags, explained the intervener. [ 26 ] The young woman also explained that her mother accompanied her seven nights a week to clean between ten and twelve cinemas. They received $5,000 a month for this work, which also included cleaning grocery and other stores.

The intervener said that they did this for eight or nine years, which allowed them to save enough money for the down payment on the house only five years after their arrival in Canada, at which time Ms. Cortez was just barely an adult. [ 27 ] Ms. Cortez explained that she purchased her home for approximately $171,000 by making a $4,000 cash down payment and monthly payments of $1,175, including tax. [ 28 ] Not only was the family able to live comfortably thanks to Ms. Cortez (with the help of her mother and occasionally a small contribution from her older brother), but also, in 2007, Ms.

Cortez opened a small convenience store serving the Hispanic community that had moved into the area. She claimed that this business contributed significantly to her enrichment. Ms. Cortez’s projects went beyond starting this business. As the rent for the store was high ($2,500/month), she and her mother wanted to save enough money to purchase the building in which it was located. The owner mentioned, only a few months after renting the premises to Ms. Cortez, that he would be willing to sell the building to her for approximately $300,000.

Paradoxically, at times he claimed that the building was his children’s future, their inheritance. Ms. Cortez now claims that the amount seized was the money she had been saving to acquire the building. [ 29 ] Ms. Cortez added that it was in the context of operating the store and a money-transfer counter that she needed a money- counting machine. [ 30 ] Ms. Cortez explained that she purchased inventory of between $500 and $1,000 per month for the store. She had purchased a lot at the beginning, she said, approximately $2,000.

An advisor had told her that $5,000 would have been too much. [ 31 ] There were no financial reports and no income tax returns. Ms. Cortez explained that the business experienced highs and lows; the rent was expensive, as was electricity. [ 32 ] Thus, the financial contribution of this business to Ms. Cortez’s enrichment is negligible. First of all, it had been in operation for only a few months, and the earnings had to have been a function of sales, which are directly related to inventory.

As the store’s inventory was very limited, the business could not have been generating anything more that negligible profit. [ 33 ] On another point, Ms. Cortez said that she had two bank accounts, one for her personal use, and another for the store. The need to have packaged the money in bundles was poorly explained. She claimed that it was to assist her mother, who otherwise would not have been able to tell how much money there was per bag.

The reason as to why she needed to know this was not explained to the Court’s satisfaction, nor was the reason why they did not take advantage of bank interest as a result of an unspecified constraint. [ 34 ] The fact that Ms. Cortez was able to save enough money to purchase her residence is quite laudable, as is the fact that she was able to continue saving while making significant monthly payments. [ 35 ] All of the jobs that Ms. Cortez held were precarious. She was paid under the table, sheltered from income tax.

Both she and her mother earned only subsistence incomes, and they had a younger child to take care of. [ 36 ] The only pay stubs provided by Ms. Cortez were from the restaurant Marcello. They indicate that she worked for an hourly wage of $9. She earned between $400 and $600 every two weeks depending on whether she worked overtime. [ 37 ] Ms.

Cortez explained that throughout this period (from 2001 until the amounts were seized on January 31, 2008), i.e ., just barely seven years, not only did she work almost non-stop evenings at the restaurant and nights in the cinemas and big stores, but also daytime at Marcello. In addition, she completed her francization courses, then training courses at the Centre Nouvel Horizon in order to finish high school, and then finally attended the Université du Québec à Hull (as she called it) where she took some courses.

[ 38 ] Moreover, during this period, the family took a least one trip to Guatemala. Ms. Cortez’s mother went to undergo a major operation, and her children accompanied her. In fact, not only is her mother quite sick, but so is Ms. Cortez. She suffers from a chronic thyroid condition and has unfortunately been diagnosed with thyroid cancer. [ 39 ] It is unlikely that she would have been able to save this money. Further, there is no documentary evidence in support of any significant income or success of the convenience store. [ 40 ] Ms. Cortez’s version of the facts does not seem credible.

There are too many discrepancies and improbabilities in her testimony. She certainly did not meet her burden of proof.

Her evidence were hardly convincing, not only in regard to her alleged ownership of the money, but also on the possibility that she could have saved such an amount on her and her mother’s employment incomes and/or income from the convenience store. [ 41 ] The Court is satisfied, on the balance of probabilities, that the amounts at issue constitute proceeds of crime obtained in relation to the perpetration of the designated offences for which Manuel Enrique Cortez was convicted. [ 42 ] The Court is able to identify only one individual who earned significant amounts of money and who had the means to save such amounts and in whose interest it was to conceal this money.

It is Manuel Enrique Cortez, a major player in a “dial-a-dope” operation. He must have been under significant pressure as a result of his illegal activities, especially considering that he had been stopped by the municipal police a few days before the search for a matter that initially had nothing to do with drugs, but he was in possession of narcotics and charged. Following this incident, it was in his interest to conceal as much of these funds as possible outside of his apartment.

The family residence was a safe place to which he had easy and unlimited access. [ 43 ] It should be noted that the Court was seized of a motion to reopen the evidence presented by the Attorney General of Canada on January 21, 2011.

The objective of reopening the evidence was to file as an exhibit the amount of $22,960 seized from ..., in Gatineau, on January 31, 2008, for the purposes of inspecting the banknotes and the inscriptions found on them. [ 44 ] The intervener Karla Cortez contested this motion. [ 45 ] In view of the Court’s conclusions on the motion for the order of forfeiture, and more specifically in regard to the insufficient evidence presented by the intervener, it would not be useful to reopen the inquiry, and for this reason, on November 9, 2011, the Court dismissed the motion to reopen the evidence.

FOR THESE REASONS, THE COURT: GRANTS this motion; ORDERS the forfeiture to Her Majesty in right of Canada the amount of $22,960, which, along with any accessory objects, shall be disposed of in accordance with the law. __________________________________ Réal R. Lapointe, J.C.Q. Mtre Karine Charland Criminal and penal prosecutor For the Attorney General of Canada Mtre François Boisvert For the defence Hearing dates: November 2 and 3, 2010