Executive Summary: Key Legal and Evidentiary Issues

• Eligibility for Canada Recovery Benefit (CRB) when an individual simultaneously received Employment Insurance (EI) benefits during the same two-week period in November 2020.

• Interpretation of paragraph 3(1)(g) of the Canada Recovery Benefits Act, which prohibits receiving CRB benefits for any period during which a person was entitled to EI benefits.

• Retroactive application of section 9.1 of the Canada Recovery Benefits Act, which created an exception allowing partial CRB benefits but was deemed to come into force on June 19, 2021.

• Whether administrative error by the CRA in erroneously paying CRB benefits retroactively relieves the recipient from the obligation to repay the overpayment.

• Procedural fairness claims regarding the CRA's decision-making process and whether the agency's failure to consider section 9.1 constituted a breach.

• Standard of review applicable to judicial review of CRA benefit repayment decisions and whether the decision was reasonable.

Background and procedural history

David Pelletier received Employment Insurance (EI) benefits during a two-week period in November 2020. After his EI benefits stopped, Mr. Pelletier applied for Canada Recovery Benefit (CRB) benefits. However, the Canada Revenue Agency (CRA) erroneously paid him CRB benefits retroactively to a period during which he had received EI benefits. The CRA's decision required that Mr. Pelletier repay benefits that he received under the CRB in respect of a two-week period in November 2020 because he received EI benefits during the same period.

Mr. Pelletier applied for judicial review of the CRA's decision to the Federal Court, which dismissed his application in its decision reported as 2024 FC 506. He then appealed that dismissal to the Federal Court of Appeal.

Mr. Pelletier's arguments on appeal

Mr. Pelletier advanced several arguments in support of his appeal. First, he argued that since the error was CRA's and he was blameless, he should not have to repay the CRB benefits in question. He criticized the CRA for erroneously paying him CRB benefits retroactively to a period during which he had received EI benefits.

Second, Mr. Pelletier argued that the CRA should have applied section 9.1 of the Canada Recovery Benefits Act to permit him to receive partial CRB benefits during the period that he was also receiving EI benefits. Section 9.1 was enacted on June 29, 2021 as an amendment to the CRB Act to introduce an exception to the general rule contemplated in paragraph 3(1)(g). Section 9.1 was deemed to have come into force earlier on June 19, 2021, but there was no provision for it to apply as early as late 2020, when Mr. Pelletier received the CRB benefits in question.

Mr. Pelletier referred to paragraph 18 of the Decision, which states that section 9.1 applies only to "those who received the CRB benefit prior to June 19, 2021." He argued that the Federal Court erred in failing to recognize that he did receive the CRB benefit prior to June 19, 2021. He noted that he even raised this point in a letter to the Federal Court shortly after the Decision was released, but that the Registry refused to receive the letter.

Third, Mr. Pelletier argued that he was denied procedural fairness in various respects before the CRA. He expressed frustration that the Federal Court first sought written submissions from the parties on section 9.1 because it found that the provision favoured him, and then concluded that it did not favour him.

Finally, Mr. Pelletier sought reimbursement of the $50.00 fee that he paid to file his notice of appeal. He noted that the filing fee was waived at the Federal Court, and he argued that the same should have been done in this appeal.

The statutory framework

The key statutory provision at issue was paragraph 3(1)(g) of the Canada Recovery Benefits Act, S.C. 2020, c. 12, which provides that a person may not receive CRB benefits for any two-week period during which they were entitled to EI benefits for all or a portion of those two weeks.

Section 9.1 was enacted on June 29, 2021 as an amendment to the CRB Act to introduce an exception to the general rule contemplated in paragraph 3(1)(g). Section 9.1 was deemed to have come into force earlier on June 19, 2021, but there was no provision for it to apply as early as late 2020, when Mr. Pelletier received the CRB benefits in question.

The Court of Appeal's analysis and ruling

Justice Locke, writing for a unanimous three-judge panel, rejected each of Mr. Pelletier's arguments. Regarding the argument that CRA's error should relieve Mr. Pelletier of the obligation to repay, the Court stated that it was "unaware of any authority to support this argument" and concluded that it could not prevail. In the absence of some authority to the contrary, any overpayment of CRB benefits to Mr. Pelletier must be repaid regardless of the cause of the overpayment. Though sympathetic to Mr. Pelletier's difficulty, the Court emphasized that "it is not in this Court's power to decide otherwise."

On the section 9.1 argument, the Court found that the use of the words "prior to" in paragraph 18 of the Decision was clearly a slip of the pen, and that the Federal Court intended to say "on or after" instead. Section 9.1 applies based on when the CRB benefit was paid, not when the CRA sought repayment. For section 9.1 to assist Mr. Pelletier, it would have to be deemed to apply back to November/December 2020 when the CRB benefit was paid. The Court concluded: "Ultimately, Parliament made a decision concerning which CRB benefits would be covered by section 9.1, and this Court has no power to question that decision."

On procedural fairness, the Court disagreed with Mr. Pelletier's claims. His arguments were directed largely to the merits of the CRA's decision rather than the fairness of the process. The CRA's silence on section 9.1 was not procedurally unfair and did not make its decision unreasonable, since that provision clearly did not apply to Mr. Pelletier. While sympathetic to the challenges Mr. Pelletier faced as a self-represented litigant lacking knowledge of the law and without counsel, the Court concluded they did not amount to a denial of procedural fairness.

Regarding the $50.00 filing fee, the Court noted that it had issued a Direction on May 13, 2024 requiring that any fee waiver request be made in a formal motion. Mr. Pelletier brought no such motion and instead paid the fee. His request at this stage amounted to a collateral attack on the Court's previous refusal to consider a fee waiver in the absence of a formal motion, and it would be inappropriate to consider the request.

Outcome

The Federal Court of Appeal dismissed the appeal, with the Attorney General of Canada prevailing as the successful party. In the circumstances of this case, the Court made no award as to costs. The specific amount of CRB benefits that Mr. Pelletier was required to repay cannot be determined from the decision.