Executive Summary: Key Legal and Evidentiary Issues

• Eligibility for the Canada Recovery Benefit (PCRE) required proof of at least $5,000 in net employment or net self-employment income during the relevant period.

• The applicant, Sylvie Leclerc, argued for consideration of gross income, referencing confusion with earlier benefit programs, but the court found only net income relevant for PCRE.

• Attempts to introduce new evidence and arguments at the judicial review stage were largely excluded by the court.

• The CRA’s decision was reviewed under the reasonableness standard and found to be justified, transparent, and intelligible.

• The court confirmed that the administrative record, not new material, determines the outcome in judicial review unless narrow exceptions apply.

• No costs were awarded, as the court exercised its discretion due to the applicant’s self-represented status.

Facts of the case

Sylvie Leclerc applied for the Canada Recovery Benefit (PCRE) for periods between October 2020 and October 2021. The Canada Revenue Agency (ARC) initially paid her a total of $24,600 without a real eligibility review. On October 11, 2022, her file was selected for an audit, and she was asked to provide documents showing she met the minimum $5,000 income threshold. Her 2019 tax return declared $7,633 in gross business income but $0 in net income after deductions. Her 2020 return showed $5,730 in gross business income and a net loss of –$1,047. These were her only declared work-related incomes for those years. The ARC attempted to contact her several times, but she was out of the country and did not respond promptly. When she did respond, she provided invoices but no proof of payment, such as bank statements. The ARC determined she was ineligible for both the PCU and PCRE due to insufficient net income and issued a decision requiring her to repay the $24,600 in PCRE received.

Policy terms and statutory interpretation

The central issue was whether gross or net income should be used to determine eligibility for the PCRE. Ms. Leclerc argued that the government’s April 30, 2021 decree for the Canada Emergency Response Benefit (PCU) allowed gross income for self-employed individuals and that similar reasoning should apply to the PCRE. The court found that the Loi sur les prestations canadiennes de relance économique (LPCRE) clearly required net income for PCRE eligibility, as stated in article 3(2): “le revenu de la personne qui exécute un travail pour son compte est constitué de son revenu moins les dépenses engagées pour le gagner.” The decree referenced by Ms. Leclerc applied only to the PCU and not to the PCRE. The court cited case law confirming that only net income is relevant for PCRE eligibility and that the ARC had no discretion to apply different criteria.

Procedural history and evidence

Ms. Leclerc’s initial PCRE applications were approved without a full review. After her file was audited, she was asked to provide documentation. The ARC’s repeated attempts to contact her by phone were unsuccessful, and she did not submit the required proof of payment for her invoices. The ARC’s first and second reviews both found her ineligible due to insufficient net income. At the judicial review stage, Ms. Leclerc sought to introduce new documents, including bank statements and revised tax filings, but the court excluded these, stating that judicial review is limited to the record before the administrative decision-maker, with exceptions not applicable in this case. The court also noted that even if the new documents had been considered, they would not have changed the outcome, as they did not establish sufficient net income.

Court’s analysis and outcome

The court reviewed the ARC’s decision using the reasonableness standard, as established in Canadian administrative law. The court found that the ARC’s decision was justified, transparent, and intelligible, and that Ms. Leclerc had been given the opportunity to provide evidence but failed to demonstrate net income above the required threshold. The court rejected Ms. Leclerc’s arguments regarding the availability or clarity of the law at the time of her application, confirming that the LPCRE was in force and accessible when she applied for PCRE. The court concluded that the ARC’s decision was reasonable and that Ms. Leclerc’s new evidence and arguments did not justify a third review or judicial intervention.

Ruling and overall outcome

The Federal Court dismissed Ms. Leclerc’s application for judicial review, ruling in favor of the Procureur général du Canada, representing the ARC. The court specifically stated that no costs were awarded against Ms. Leclerc, who represented herself. The total amount at issue was $24,600, which Ms. Leclerc was required to repay, but no additional monetary award or costs were granted to the successful party.