Docket: CACV2418 The Director Under The Seizure of Criminal Property Act, 2009 (Applicant) Appellant - v. -, 2013 SKCA 140

THE COURT OF APPEAL FOR SASKATCHEWAN Citation: 2013 SKCA 140 Date: 2013-12-20 Between: Docket: CACV2418 The Director Under The Seizure of Criminal Property Act, 2009 (Applicant) Appellant - and - Daniel Kotyk and the Attorney General of Canada Respondents Coram: Cameron, Herauf and Whitmore JJ.A. Counsel: Alan Fern for the appellant Robin Neufeld for the respondent, Attorney General No one appearing on behalf of Daniel Kotyk Appeal: From: 2013 SKQB 182 Heard: October 17, 2013 Disposition: Allowed

Written Reasons: December 20, 2013 By: The Honourable Mr. Justice Herauf In Concurrence: The Honourable Mr. Justice Cameron The Honourable Mr. Justice Whitmore Herauf J.A. I. Introduction [ 1 ] This is an appeal by the Director appointed pursuant to s. 22 of The Seizure of Criminal Property Act, 2009 , S.S. 2009, c. S- 46.002 from the dismissal by a Queen’s Bench Chambers judge of a forfeiture application relating to $13,500.00 in cash seized from the respondent, Daniel Kotyk. See: 2013 SKQB 182 . [ 2 ] The Chambers judge held that the totality of the Director’s material amounted to “no evidence”.

As a result, the Chambers judge held he could not make an inference to support the Director’s assertion that the $13,500.00 is either proceeds of, or an instrument of, unlawful activity. [ 3 ] For the reasons that follow, we would allow the Director’s appeal and order that the $13,500.00 in cash be forfeited to the Crown in Right of Saskatchewan. In our view there was clear, convincing and cogent evidence to satisfy the balance of probabilities test that the funds in question were either proceeds of unlawful activity or an instrument of unlawful activity as required by s. 7 of the Act . II.

The Facts [ 4 ] Since this is a circumstantial evidence case and the sufficiency of the evidence and standard of proof have been raised as grounds of appeal, the facts will be set out in some detail. [ 5 ] The Director’s application for forfeiture was supported by affidavits of certain investigating officers, namely Cst. Carrie Pankratz, Cpl. Devin Pugh, and Lise Gray. Lise Gray was qualified by the Chambers judge as an expert to give opinion evidence with respect to illicit drug activities and practice.

The facts are taken from the affidavits. [ 6 ] On January 2, 2013, Constable Carrie Pankratz of the Indian Head detachment of the RCMP responded to a report of a single vehicle rollover near Wolseley. When Cst. Pankratz arrived, the vehicle was on its roof. The two males who had been in the truck, Ontario residents Bryon Kelly and Daniel Kotyk, were checked out by EMS and then entered the police vehicle to provide statements and to fill out an accident report. The driver and owner of the vehicle was Mr. Kelly. Upon conducting a database search, Cst. Pankratz discovered that Mr.

Kotyk was under a conditional sentence order (“CSO”) in Ontario for producing a substance contrary to the Controlled Drugs and Substances Act , S.C. 1996, c. 19. One of the conditions of Mr. Kotyk’s CSO was a prohibition on leaving the province of Ontario. Cst. Pankratz arrested Mr. Kotyk for being in breach of his CSO and transported both Mr. Kotyk and Mr. Kelly to the RCMP detachment in Indian Head. Mr. Kotyk was placed in a cell pending confirmation of the status of his CSO. Cst. Pankratz asked Mr. Kotyk where he was going. Mr. Kotyk replied that he and Mr. Kelly were on their way to visit Mr.

Kotyk’s friend Kevin in Vernon, British Columbia. Cst. Pankratz reminded Mr. Kotyk he was under arrest for breach of his CSO. Cst. Pankratz asked Mr. Kotyk if he wanted to contact a lawyer. Mr. Kotyk declined to do so, though he indicated he might change his mind. Mr. Kotyk then produced three $100 bills and asked Cst. Pankratz to give them to Mr. Kelly, along with the phone number of his friend Kevin. [ 7 ] In another interview room, Mr. Kelly told Cst.

Pankratz he was trying to secure a U-haul truck to gather up belongings from the crash site and continue on to Vernon, where he was going to invest in a barbecue sauce company. As she spoke with Mr. Kelly, Cst. Pankratz smelled marihuana. The longer Mr. Kelly was in the interview room, the stronger the smell became. Cst. Pankratz provided the phone number and cash that Mr. Kotyk had asked her to give to Mr. Kelly, and then asked Mr. Kelly if he had been smoking marihuana. Mr. Kelly said the smell of marihuana was on him because Mr. Kotyk had been smoking a couple of joints in his truck. At this point Cst.

Pankratz began to suspect that the pair had been transporting drugs when the rollover occurred. [ 8 ] Cpl. Devin Pugh then arrived at the detachment. Cst. Pankratz brought him up to speed. Cpl. Pugh entered the interview room where Mr. Kelly was on the phone, trying to arrange for a rental vehicle. Cpl. Pugh smelled raw marihuana in the room and asked Mr. Kelly about it. Mr. Kelly initially denied possessing any marihuana. After further discussion, Mr. Kelly removed a small blue container containing several small marihuana “roaches” (burnt pieces of marihuana cigarettes) from his jacket pocket. [ 9 ] Cpl.

Pugh advised Mr. Kelly he was under arrest for possession of a controlled substance and that the small amount of marihuana found in the container did not account for the smell of marihuana in the room. Cpl. Pugh told Mr. Kelly he was going to perform a search incident to the arrest, and noted that Mr. Kelly became quite nervous at this point. During the search, Cpl. Pugh asked Mr. Kelly to remove his boots. A small plastic baggie fell out of his right boot. Cpl. Pugh picked up the baggie and discovered a small quantity of raw marihuana inside. Mr.

Kelly then removed his left boot and a rectangular package wrapped in silver duct tape fell to the ground. Cpl. Pugh picked up the package and asked Mr. Kelly what was inside. Mr. Kelly responded that the package contained cash. When Cpl. Pugh asked him how much, he responded the package contained $13,500, that the money was his, and that he intended to invest it in a barbecue sauce company. Cpl. Pugh asked Mr. Kelly why he kept marihuana and cash in his boots. Mr. Kelly responded that Mr. Kotyk must have put the marihuana in his boot. Cpl. Pugh arrested Mr.

Kelly for possession of a controlled substance and possession of proceeds of crime.

[ 10 ] Cst. Pankratz opened the package wrapped in duct tape. It contained two bundles of cash. The first bundle was comprised of different denominations of bills (totalling $5,000) held together by elastics. The second bundle was comprised entirely of $100 bills (totalling $8,500) wrapped in brown paper and green painter's tape. Both bundles were then wrapped in a clear plastic bag and duct taped together. [ 11 ] Both Mr. Kelly and Mr. Kotyk provided warned statements to police. In a video recorded statement, Mr. Kelly said he and Mr.

Kotyk were on their way to Vernon, British Columbia to visit a friend named Kevin. Mr. Kelly stated that Kevin owns a company that makes barbecue sauce and Mr. Kelly intended to invest money with the company. Mr. Kelly could not remember the name of the barbecue sauce company or the type of barbecue sauce it made, but stated his friend Kevin was doing very well. In his statement, Mr. Kelly said there was $13,500 in the package found in his boot. Mr. Kelly stated the package contained Canadian currency made up entirely of $100 bills. Cpl.

Pugh questioned him further about the package and asked him to describe how he packaged the cash. Mr. Kelly stated he packaged the bills inside of duct tape. He said he had made two bundles, one totaling $10,000 and consisting entirely of $100 bills, which he placed in opposite directions before wrapping both bundles together with duct tape. Mr. Kelly said he packaged the cash in duct tape to seal it so it would not get wet. Cpl. Pugh asked Mr. Kelly if there was anything of note regarding the packaging technique or materials he used to package the money. Mr.

Kelly responded he had packaged the money three days ago and could no longer recall the specifics of the packaging. [ 12 ] Cpl. Pugh left the interview room for a brief period. Upon his return, Mr. Kelly said that he “wanted to come clean”. He said the money actually belonged to Mr. Kotyk. Mr. Kelly stated that after the accident, Mr. Kotyk removed a duffle bag from the vehicle and located the bundle of cash. Mr. Kelly stated that Mr. Kotyk gave him the cash and asked him to hide it. Mr. Kelly complied by placing the package into his boot. [ 13 ] After taking the statement from Mr. Kelly, Cpl.

Pugh obtained a video recorded warned statement from Mr. Kotyk. Initially, Mr. Kotyk claimed that the money seized from Mr. Kelly belonged to Mr. Kelly. Cpl. Pugh confronted Mr. Kotyk with the knowledge he had gleaned from his interview of Mr. Kelly, and Mr. Kotyk admitted ownership of the cash. Mr. Kotyk said the money was legitimate and he had saved it by working in the construction industry. Mr. Kotyk told Cpl. Pugh the money was not illegal and where it came from was "nobody's business".

He then said he was going to British Columbia to buy a couple of trucks as they are cheaper and nicer there than in Ontario. Mr. Kotyk told Cpl. Pugh he has "flipped" many vehicles in the past, and investing in the barbecue sauce company was another option, since he is "all about making a buck". [ 14 ] Mr. Kotyk informed Cpl. Pugh he owed $25,000 in fines and at one point owed $18,000 to the Canada Revenue Agency, who put a lien on his accounts. He stated his weekly paycheque is deposited directly into an account and he withdraws it immediately.

He stated he has been taking out $1,000 per week for several weeks. [ 15 ] Mr. Kotyk stated he did not tell Mr. Kelly to hide the money; rather, he simply told Mr. Kelly to grab the cash, since it was unlikely that the police would hold him. Unlike Mr. Kelly, Mr. Kotyk was able to accurately describe the specific manner in which the money was packaged. [ 16 ] Mr. Kotyk then told Cpl. Pugh that he had borrowed roughly $10,000 of the money from a friend. He stated he signed an affidavit for the money he borrowed and could obtain an affidavit from the friend to prove the money was legitimate.

He was not willing to tell Cpl. Pugh who the friend was. [ 17 ] Mr. Kotyk stated he had been a “pothead” all his life and was in the process of applying for a permit from Health Canada. Mr. Kotyk maintained the intention of their trip was not to purchase marihuana. Mr. Kotyk then asked Cpl. Pugh what Cpl. Pugh would be willing to do for him if he forfeited the cash forthwith. Mr. Kotyk stated he had been out of work for about a year and a half, and did not want to lose his new job. Mr.

Kotyk offered to forfeit the cash if the police would release him on a promise to turn himself over to his Probation Officer in Ontario. [ 18 ] Cpl. Pugh told Mr. Kotyk it was clear to him that they were traveling to British Columbia to buy drugs to take back to Ontario. Mr. Kotyk replied "yeah, but there is no way you can prove that". [ 19 ] Mr. Kotyk has a lengthy criminal record including offences of violence and multiple convictions for possession of drugs for the purpose of trafficking. Mr.

Kelly has a criminal record involving drugs as well. [ 20 ] It should be noted that this narrative was not challenged by either Mr. Kelly or Mr. Kotyk. Prior to the hearing before the Chambers judge, Mr. Kelly provided an affidavit wherein he indicated he had no interest in the money seized by the R.C.M.P. Mr. Kotyk, while dutifully accepting service of all documents, elected not to participate in the hearing or file any material in response. III.

The Chambers Decision [ 21 ] The Chambers judge noted the facts and circumstances “raise suspicions.” He also noted the “inconsistent and contradictory statements” of Mr. Kelly and Mr. Kotyk “strain credulity”.

However, he was not prepared, on the whole of the facts, to draw the inference “that the money was property constituting an instrument or proceeds of unlawful activity.” Indeed, he said there was “no evidence” to support the conclusion the $13,500.00 cash was the proceeds of any unlawful activity, including drug sales, or that the money would be used to purchase drugs in British Columbia. [ 22 ] The Chambers judge acknowledged s. 11 of the Act establishes the standard of proof to be the balance of probabilities.

However, as already noted, the Chambers judge dismissed the Director’s application for forfeiture of the money as he was unable to conclude that it was proceeds or an instrument of unlawful activity. IV. The Legislation [ 23 ] “Instrument of unlawful activity”, “proceeds of unlawful activity”, and “unlawful activity”, are defined in s. 2 of the Act as follows:

(i) “instrument of unlawful activity” means property that: (

i) has been used to engage in unlawful activity that, in turn, resulted in or was likely to result in or was intended to result in the acquisition or production of property or in bodily harm to a person; or (ii) is likely to be used to engage in unlawful activity that, in turn, would be likely to or is intended to result in the acquisition or production of other property or in bodily harm to a person; . . . (p) “proceeds of unlawful activity” means: (

i) property acquired directly or indirectly, in whole or in part, as a result of unlawful activity, whether the property was acquired before or after the coming into force of this Act; and (ii) an increase in the value of property, or a decrease in a debt obligation secured against property, if the increase or decrease resulted directly or indirectly from unlawful activity; . . . (u) “unlawful activity” means

an act or omission that is an offence pursuant to: (

i) an Act,

an Act of any province or territory of Canada or

an Act of the Parliament of Canada; or (ii)

an Act of a jurisdiction outside Canada, if a similar act or omission would be an offence pursuant to

an Act or

an Act of the Parliament of Canada if it were committed in Saskatchewan; [ 24 ] Forfeiture of property is available if the court is satisfied that the criteria contained in s. 7 of the Act have been made out.

Section 7 reads as follows: 7(1) Subject to

section 8, and unless it clearly would not be in the interests of justice, the court shall make an order forfeiting property to the Crown if the court finds that the property is proceeds of unlawful activity or an instrument of unlawful activity.

(2) In order to make a forfeiture order in an application for forfeiture of property that is alleged to be proceeds of unlawful activity, the court: (

a) is not required to be satisfied that the property was acquired in connection with a specific unlawful act; and (

b) is not required to be satisfied that an increase in the value of property or a decrease in a debt obligation secured against the property arose as the result of a specific unlawful act.

(3) If a forfeiture order is made pursuant to subsection (1), the property is forfeited to the Crown: (

a) in the case of real property, as of the date a transfer based on the forfeiture order is registered in the land titles registry; or (

b) in the case of personal property, as of the date a notice of an application for a forfeiture order is registered in the personal property registry pursuant to

section 5.

(4) Notwithstanding any other Act or law, the Crown does not assume, and is not bound by, any covenants or other obligations under a mortgage or other interest affecting the forfeited property. [ 25 ] The standard of proof is set out in s. 11 of the Act as follows: 11 Except as otherwise provided in this Act, in an application made pursuant to this Act, the standard of proof is to be on the balance of probabilities. V. The Appeal [ 26 ] Richards C.J.S., granted the Director leave to appeal pursuant to s. 18 of the Act . The following matters arising out of grounds of appeal will be analysed: (

i) the standard of proof employed by the Chambers judge, (ii) his finding of no evidence to support the forfeiture, (iii) whether he should have drawn an adverse inference from the failure of Mr. Kotyk to respond to the case against him, and, (iv) whether he failed to have proper regard for the opinion evidence regarding the likely source and intended use of the money. (

i) Standard of Proof [ 27 ] To a certain extent an analysis of this ground of appeal overlaps with the “no evidence” ground. [ 28 ] The Director submits that the Chambers judge erred by applying a standard of proof more onerous than the civil standard of proof on the balance of probabilities. [ 29 ]

Section 11 of the Act provides that all applications pursuant to the Act are to be determined on the balance of probabilities. In F.H. v. McDougall , 2008 SCC 53 , [2008] 3 S.C.R. 41, the Supreme Court of Canada, adopting this standard for all civil cases, made at least three relevant comments regarding the application of the standard. First, the Court noted that there is no presumption of innocence in civil cases. Second, the Court made the following statement at para. 45:

To suggest that depending upon the seriousness, the evidence in the civil case must be scrutinized with greater care implies that in less serious cases the evidence need not be scrutinized with such care. I think it is inappropriate to say that there are legally recognized different levels of scrutiny of the evidence depending upon the seriousness of the case .

There is only one legal rule and that is that in all cases, evidence must be scrutinized with care by the trial judge. [emphasis added] Third, the Court reiterated that the standard is whether the allegation is more likely than not, and that whether a proposition is inherently probable or improbable is a matter of common sense. [ 30 ] Turning to a related matter, we note that in Chatterjee v.

Ontario (Attorney General) , 2009 SCC 19 , [2009] 1 S.C.R. 624, at para. 23 the Supreme Court held that the Ontario equivalent of the Saskatchewan statute: . . .[C]reates a property-based authority to seize money and other things shown on a balance of probabilities to be tainted by crime and thereafter to allocate the proceeds to compensating victims of and remedying the societal effects of criminality. The practical (and intended) effect is also to take the profit out of crime and to deter its present and would-be perpetrators.

The Court also found the dominant purpose of the scheme is not punishment. [ 31 ] Clause 7(2)(

a) of the Act is also relevant to the standard or onus of proof:

(2) In order to make a forfeiture order in an application for forfeiture of property that is alleged to be proceeds of unlawful activity, the court: (

a) is not required to be satisfied that the property was acquired in connection with a specific unlawful act; [ 32 ] The Chambers judge in this case found the explanation of Mr. Kelly and Mr. Kotyk to strain credulity. Nevertheless, he quoted and relied upon his previous decision in R. v. Pelletier , 2012 SKQB 271 , 400 Sask.

R. 314 at para. 21 : Forfeiture applications are punitive and they require the court to carefully scrutinize the evidence , and consequently, the legal basis upon which a forfeiture order can properly issue. [emphasis added] [ 33 ] To the extent this passage implies that the Act is a predominantly punitive scheme requiring special scrutiny of the evidence, it is not in line with F.H. v. McDougall or Chatterjee . The conclusion of the Chambers judge that the inconsistent and contradictory statements of Mr. Kotyk and Mr.

Kelly strain credulity but did not raise the case beyond the level of the “suspicion” raises a concern that something like a presumption of innocence was applied, contrary to F.H. and the Act . Moreover, the statement of the Chambers judge on the punitive aspect of forfeiture applications seems to indicate that he was searching for a specific unlawful act to which the money is traceable. Section 7(2)(

a) of the Act provides that this is not necessary. The question was whether, on a common sense view of the situation, it was more likely than not the money was proceeds of, or an instrument of, unlawful activity. Suspicious circumstances constitute evidence.

A finding of no evidence in this case indicates the Chambers judge either applied the wrong standard, or misconceived the nature of the onus, or was looking for more direct evidence of unlawful activity than was necessary. (ii) The Finding of No Evidence to Support the Forfeiture [ 34 ] The Director maintains the Chambers judge erred in his finding there was no evidence to support the forfeiture application. The Supreme Court of Canada in F.H. v.

McDougall noted that in determining whether it is more probable than not the evidence must be “sufficiently clear, convincing and cogent to satisfy the balance of probabilities test.” In this case, it must be remembered that none of the evidence was contested. Any examination of the circumstances to ascertain whether the evidence was “sufficiently clear, convincing and cogent” must start with the findings of the Chambers judge on this issue.

At paras. 13 and 14 of the judgment the Chambers judge had this to say about the sufficiency of evidence: There is no question that the whole of the facts and circumstances as they relate to Kotyk and Kelly raise suspicions as to the source of the cash, the nature of its packaging and its intended use. The denominations and packaging are consistent with denominations commonly used in the drug trade (Gray affidavit). Kotyk's past and current criminal record including drug charges, his CSO and, to a lesser extent Kelly's criminal record, raise obvious suspicions.

These circumstances, combined with their inconsistent and contradictory statements to the investigating officers concerning the ownership of the money, their stated intentions for the use of the money in British Columbia, all strain credulity. They certainly contribute to the suspicious nature of the whole of the circumstances. So, too, does their possession of small quantities of marihuana on Kelly's person and the smell of it on both these individuals.

Nevertheless, while the whole of the circumstances are very suspicious indeed, they fall short of facts and circumstances evidencing or supporting the drawing of proper judicial inference that the money was property constituting an instrument or proceeds of unlawful activity as defined by the Act.

There was no evidence to support the conclusion that the $13,500.00 cash was the proceeds of any unlawful activity, including drug sales, nor that the money would be used to purchase drugs in British Columbia. [ 35 ] With the greatest of respect, we are of the opinion the Chambers judge misconceived the state of the evidence, especially when seen in its totality and in light of the fact not a shred of it was challenged. [ 36 ] In addition to the evidence the Chambers judge found raised suspicions, he failed to mention other evidence, or other facts that, in our view, support the Director’s theory that the $13,500.00 was to be tainted by crime, namely the illegal sale or purchase of illicit drugs.

The additional matters of evidence and facts are these: (

a) Mr. Kelly stated after the rollover, Mr. Kotyk grabbed a black duffel bag, removed the package of cash, and asked Mr. Kelly to hide

it for him. Mr. Kotyk stated he did not tell Mr. Kelly to hide the money; rather, he told Mr. Kelly to grab the cash because Mr. Kelly wasmore likely to be released; (

b) Mr. Kotyk initially denied the money was his. He then admitted it was his and stated it was either for buying trucks (which are“cheaper and nicer” in British Columbia than in Ontario) or investing in a barbecue sauce company in British Columbia. Mr. Kotykstated he kept cash because of outstanding fines and because the Canada Revenue Agency has a lien on his bank accounts. Mr. Kotykthen stated only part of the cash was his and $10,000 had been borrowed from a friend (having “signed an affidavit” for it) who couldprove the money was legitimate. He was not willing to name this friend; (

c) Mr. Kotyk “asked Cpl. Pugh what he would be willing to do for him if he forfeited the cash forthwith” and offered to forfeit the cashif the police would release him on a promise to turn himself over to his probation officer in Ontario; and (

d) When Corporal Pugh told Mr. Kotyk it was clear to him that Mr. Kotyk and Mr. Kelly were travelling to British Columbia to buydrugs to take back to Ontario, Mr. Kotyk responded by saying “yeah, but there is no way you can prove that”. [37] A combination of all of this evidence, seen in light of the totality of the evidence, paints a rather overwhelming narrative to supportthe Director’s contention the property in question was either proceeds, or an instrument of, unlawful activity.

We agree that under thecircumstances it was unreasonable for the Chambers judge to find there was no evidence to support this conclusion. (iii) Adverse Inference [38] The Director submits the Chambers judge should have gone further than stating that “Kotyk had not claimed return of the fundsnor … taken a position in respect of this application.” According to the Director, Kotyk’s lack of any kind of answer to a very strongcircumstantial evidence case should be considered as a circumstance in support of a forfeiture order. [39] Admittedly, common sense suggests that anyone who is the subject of an erroneous seizure by the state of money would make aneffort to get the money back.

Reference can be made to two Ontario cases: Ontario (Attorney General) v. $43,120 in Canadian Currency(In Rem), 2011 ONSC 3076; Ontario (Attorney General) v. $1,650 Canadian Currency (In Rem), [2008] O.J. No. 2076 (QL), where itwas held that strong circumstantial evidence in forfeiture cases calls for a credible and reasonable answer. The often quoted paragraph inR. v.

Jenkins (1908), (BC SC), 14 C.C.C. 221 (B.C.S.C.) at p. 230 is apposite as well: It is true that a man is not called upon to explain suspicious things, but there comes a time when, circumstantial evidence havingenveloped a man in a strong and cogent net-work of inculpatory facts, that man is bound to make some explanation or stand condemned. [40] In strong circumstantial evidence cases such as this, the failure of the respondent to engage in the process and provide at least someexplanation to counter the substantial body of evidence against him should have merited the consideration of the Chambers judge. (iv) Expert Evidence [41] The Director submits the Chambers judge erred either by overlooking or rejecting Lise Gray’s opinion that the money was eitheran instrument of, or proceeds of, unlawful activity. [42] As previously noted, the Chambers judge qualified Lise Gray as an expert “with respect to illicit drug activities and practices” andrelied on her evidence to show that the “denominations and packaging are consistent with denominations commonly used in the drugtrade.” The Chambers judge did not, however, mention her opinion regarding the likely source or intended use of the money.

She saidthis of the matter at para. 88 of her affidavit: Based on the information reviewed, as indicated above, and my training and experience, it is my opinion that the $13,500.00 in bundledcurrency was derived directly or indirectly from the trafficking of illicit drugs and is thus proceeds of unlawful activity or is aninstrument of unlawful activity in that it is likely to be used to engage in unlawful activity that, in turn, would be likely to or is intended toresult in the acquisition or production of other property. [Appeal Book at p. 20] [43] Since the Chambers judge made no mention of this, it may be inferred that he either overlooked it or rejected it.

However, sincethe expert’s opinion expresses a conclusion on the ultimate issue before the Chambers judge, it is important to review the state of the lawon this issue. [44] The leading case on expert evidence in Canada is R. v. Mohan, (SCC), [1994] 2 S.C.R. 9. In that case, Sopinka J.,for the unanimous Supreme Court of Canada, set out four factors for the admission of expert evidence: (1) relevance; (2) necessity inassisting the trier of fact; (3) the absence of any exclusionary rule; and (4) a properly qualified expert.

Regarding the second point (thenecessity criterion), Sopinka J. wrote at pp. 24-25: As in the case of relevance, discussed above, the need for the evidence is assessed in light of its potential to distort the fact-findingprocess. As stated by Lawton L.J. in R. v. Turner, [1975] Q.B. 834, at p. 841, and approved by Lord Wilberforce in Director of PublicProsecutions v. Jordan, [1977] A.C. 699, at p. 718: "An expert's opinion is admissible to furnish the court with scientific information which is likely to be outside the experience andknowledge of a judge or jury.

If on the proven facts a judge or jury can form their own conclusions without help, then the opinion of anexpert is unnecessary. In such a case if it is given dressed up in scientific jargon it may make judgment more difficult.

The fact that anexpert witness has impressive scientific qualifications does not by that fact alone make his opinion on matters of human nature andbehaviour within the limits of normality any more helpful than that of the jurors themselves; but there is a danger that they may think itdoes." The possibility that evidence will overwhelm the jury and distract them from their task can often be offset by proper instructions.

There is also a concern inherent in the application of this criterion that experts not be permitted to usurp the functions of the trier of fact . Too liberal an approach could result in a trial's becoming nothing more than a contest of experts with the trier of fact acting as referee in deciding which expert to accept. These concerns were the basis of the rule which excluded expert evidence in respect of the ultimate issue. Although the rule is no longer of general application, the concerns underlying it remain.

In light of these concerns, the criteria of relevance and necessity are applied strictly, on occasion, to exclude expert evidence as to an ultimate issue.

Expert evidence as to credibility or oath-helping has been excluded on this basis. [emphasis added] In summarizing the four principles to be applied, the Court stated at p. 25: [I]t appears from the foregoing that expert evidence which advances a novel scientific theory or technique is subjected to special scrutiny to determine whether it meets a basic threshold of reliability and whether it is essential in the sense that the trier of fact will be unable to come to a satisfactory conclusion without the assistance of the expert.

The closer the evidence approaches an opinion on an ultimate issue, the stricter the application of this principle . [emphasis added] [ 45 ] “Ultimate issue” concerns have thus been subsumed into the general Mohan analysis of the admissibility of expert evidence. [ 46 ] Alan W. Bryant, Sidney N. Lederman and Michelle K.

Fuerst, the authors of The Law of Evidence in Canada , 3 rd ed. (Markham: LexisNexis, 2009), after a review of the treatment of this rule, summarize the current state of the law as follows at pp. 833-84: In the final analysis, the closer the experts’ testimony approaches an opinion on the ultimate issue, the stricter the courts will apply the requirements of reliability and necessity before admitting such evidence. This is so because the evidence then begins to overlap not only the fact-finding function of the court but the legal analysis that must be applied to the facts in rendering the ultimate decision.

It is now generally said that if expert testimony is rejected it is excluded not because of any “ultimate issue” doctrine, but because such evidence is superfluous and the court can just as readily draw the necessary inference without any assistance from an expert or alternatively, the trial judge may give an appropriate instruction to the jury .

However, trial judges as gatekeepers must be alert to the extent of the expert’s influence over juries, especially if the opinion deals with a fundamental issue that is within the province of the jury. [emphasis added] [ 47 ] Mindful of this, we cannot know on what basis the Chambers judge either ignored or rejected the opinion evidence of Lise Gray regarding the likely source or intended use of the money.

We do know, however, that he was not necessarily bound to accept her opinion in this regard and that, as a matter of principle, it was open to him to have rejected it on the footings it was superfluous and related to a matter in respect of which he did not need her assistance in drawing proper inferences from the facts as a whole. Indeed, much of Lise Gray’s reasoning in this regard is based on common sense and did not relate to the drawing of inferences relative to a matter beyond the experience of the Chambers judge.

For instance, the Chambers judge did not need expert evidence to help him understand the implications of the strange and changing and conflicting stories told by the two men while under criminal investigation. Nor did he need expert evidence to assist him in understanding the general implications of the possession by the two men of a huge amount of hidden and strangely assembled cash for the purported purpose of legitimate commercial transactions of the kind and magnitude they said they had in mind. And on it goes.

It might be noted that Lise Gray’s reasoning in relation to the likely source and intended use of the money, when viewed in the context of the whole of the facts of the case, is essentially the same as the reasoning employed by the Director in his submission to the Chambers judge. The issue reduced to what inferences of fact the Chambers judge might properly have drawn in relation to the ultimate issue he was called upon to decide. [ 48 ] The point is threefold.

First, it is difficult in the circumstances to say the Chambers judge erred in principle in either ignoring or rejecting the opinion evidence of Lise Gray regarding the ultimate issue he was called upon to decide. Second, it was for the Chambers judge to decide the ultimate issue having regard for what inferences of fact in this regard could reasonably be drawn from the established facts, bearing in mind the standard of proof applicable to the case.

Third, the opinion evidence of Lise Gray in respect to the matter under consideration was not of such quality as to carry much, if any, weight in the assessment of an experienced Chambers judge. In sum, the appeal is not destined to succeed or fail on this ground. VI.

Conclusion [ 49 ] Based upon our analysis of the matters raised by the grounds of appeal we are of the respectful view the Chambers judge misapplied the standard of proof, namely proof on a balance of probabilities, thinking that forfeiture applications were punitive and therefore required something more in the way of proof, or scrutiny of the evidence, than was ordinarily called for.

In consequence, he failed in our respectful opinion to draw the reasonable inference that it was more likely than not that the source or intended use of the money in issue was tainted by crime in the sense it derived from, or was intended to be used in, the illicit trade in drugs.

In our judgment, the evidence as a whole, when viewed in the light of the balance of probabilities test properly applied, was sufficiently clear, convincing and cogent to meet the test, and thus called for the drawing of the inference that the money constituted the proceeds of, or the instrument of, unlawful activity within contemplation of s. 7 of the Act . [ 50 ] Accordingly, we have decided to allow the appeal and order that the $13,500 in issue be forfeited to the Crown in right of Saskatchewan. There will be judgment accordingly.

DATED at the City of Regina, in the Province of Saskatchewan, this 20 th day of December, A.D. 2013.

“Herauf J.A.” _______________________ Herauf J.A. I concur. “Cameron J.A.” Cameron J.A. I concur. “Whitmore J.A.” Whitmore J.A.