Executive Summary: Key Legal and Evidentiary Issues

• A luxury watch valued at approximately CAD $115,000 was not declared by the applicant upon his return to Canada

• CBSA imposed a 30 percent penalty amounting to CAD $34,650.65 under the Customs Act

• The applicant challenged the penalty by seeking judicial review, claiming the decision was rigid and ignored relevant personal context

• The court held that the Minister’s delegate properly exercised discretion and applied the CBSA’s guidelines fairly

• Claims of good faith and previous import experiences were dismissed due to lack of supporting evidence

• The application was dismissed and costs were awarded to the respondent, though the amount was unspecified

Facts and outcome of the case

The facts of the case

David Segall Blouin, a Canadian businessman, purchased a luxury wristwatch in Philadelphia in July 2022 for USD $89,990, equivalent to about CAD $115,000. He traveled to Philadelphia in early August to collect the watch and returned to Montréal the same day. Upon re-entry into Canada, he did not declare the watch to the Canada Border Services Agency. Around the same time, he arranged for the empty watch case to be shipped to him separately with a declaration that it was worth only CAD $6.

Following an investigation, CBSA discovered the true nature and value of the imported item and issued a notice of ascertained forfeiture under section 124 of the Customs Act. The notice imposed a penalty of CAD $34,650.65, representing 30 percent of the undeclared item’s value. Mr. Blouin applied for a ministerial review under section 129 of the Act. The Minister’s delegate upheld the forfeiture and penalty, stating the lowest applicable level under CBSA guidelines had been applied and was appropriate in light of the facts.

Mr. Blouin did not appeal the finding that he had contravened the reporting requirement under section 12 but instead brought an application for judicial review focusing on the penalty amount. He argued that the Minister’s delegate failed to properly consider his intention and the specific context of the importation.

The outcome

The Federal Court found that the Minister’s delegate had exercised discretion reasonably and did not mechanically apply the CBSA guidelines. The decision made clear reference to the circumstances of the case and concluded that the 30 percent penalty was both the minimum prescribed level and consistent with comparable violations.

The applicant’s argument that he acted in good faith or that he intended to pay duties later was not supported by the evidence. The CBSA officer statements and documentation showed the package with the watch case had a declared value of CAD $6 and lacked any invoice or proper valuation. The court also found no explanation for separating the watch and its case other than an attempt to avoid detection or payment of duties.

The judicial review application was dismissed. The penalty of CAD $34,650.65 was upheld, and the court awarded costs to the respondent, the Minister of Public Safety and Emergency Preparedness, though no specific cost amount was stated.