Henry J. (Orally):—On June 16, 1986, Callaghan A.C.J.H.C. issued four warrants to enter and search the three business premises and the private dwelling of the applicant Thomas A. Corr pursuant to s. 231.3 of the Income Tax Act. The warrants were executed on June 17, and a large number of documents were seized and taken away by the agents, employees and representatives of the Department of National Revenue — Taxation and the R.C.M.P. The information before the judge alleged reasonable and probable grounds to believe that offences under the Income Tax Act had been committed and that evidence thereof may be afforded by documents and other matter described in the premises described in the information.
The applicants wish to challenge the seizure in three principal ways.
(a) That the provisions of the Income Tax Act under which the warrants were issued, section 231.3, are inconsistent with the Canadian Charter Of Rights and Freedoms and the warrants are also inconsistent with the Canadian Charter Of Rights and Freedoms, in particular sections 7, 8 and 15.
(b) The searches and seizures were not in accordance with the authority of the warrants.
(c) The warrants were defective inter alia, in that the documents to be seized were not reasonably specified and did not disclose the offences with particularity.
The applicants therefore say that the warrants, searches and seizures are a nullity.
The substantive motion to quash the warrants has already been set down to come before this court in November.
In the meantime the applicants seek an order impounding the documents so that the investigating officers will not have access to them pending the decision of the court on the foregoing issues.
There is no dispute that this court has inherent jurisdiction to make such an order and that this court has jurisdiction to grant relief to the applicants on the main application under section 24 of the Charter. There is also no dispute that the main application is not frivolous. I need only say the predecessor to section 231.3 has been held to offend against the Charter by three appellate courts including the Ontario Court of Appeal in The Queen v. Print Three Inc., Laserdata Technology Inc. and Jacques Benquesus, [1985] 2 C.T.C. 48; 85 D.T.C. 5303.
The question now before the court is whether the new provisions that have subsequently been enacted overcome the defect.
The issue before me is whether I should exercise the Court's discretion to make the order asked. The matter may, in practical terms, be reduced to the balance of convenience.
If the documents are not impounded and sealed, the applicants may effectively lose their right to be protected against use of the documents in the on-going departmental investigation should it turn out that the seizures were a nullity. That right is to the preservation and protection of those documents from use by the authorities except in accordance with law. That right will probably become nugatory if the impounding order is not made. The loss of that right is not, in my opinion, a matter that can adequately be compensated in damages. The right can be protected by maintaining the status quo — that is, by denying further access to the investigators pending resolution of the issues raised.
If the impounding order is made, the Crown will suffer delay in continuing its preparation to bring charges before the court. I am not satisfied that such delay is, as at present contemplated, such as to frustrate the course of prosecution in a manner detrimental to the public interest. If it turns out to be so the matter may be raised before the judge hearing the main application at which time the impounding order will expire.
Mr. Flaherty submits that the Crown requires access to the documents in order to prepare for the attack on the issue and execution of the warrants which will require reference to specific documents and evidence among the seized materials. That, however, will require the applicants, upon whom the onus lies, to disclose documents they say were not within the authority of the warrants or do not disclose an offence. The Crown will then have disclosure of the documents relied on by the applicants who can be cross- examined on affidavits supporting the application.
I have also considered other submissions made by Mr. Flaherty but I find them of no substance. I can find no serious prejudice to the Crown so far as I can see in making the order asked; if the order is not made the applicants’ fundamental rights will probably be rendered nugatory. Subsection 24(2) of the Charter may overcome that problem but that remedy is not automatic.
In all the circumstances I have decided to make the order. The documents will be placed in the custody of Mr. Eli Drakick, an officer of the Department of National Revenue who is acceptable to all parties; they will remain so pending further order of the Court.
I have accordingly endorsed the record as follows:
Order to issue as asked in paragraphs 1, 2 and 3 of the Notice of Motion with the following amendments:
Paragraph 2 to provide that the custodian shall be Mr. Eli Drakik, an officer of the Department of National Revenue — Taxation
Paragraph 3 to have added at the end thereof “In accordance with s. 231.3(8) and s. 232 of the Income Tax Act".
Costs of this motion reserved to the judge hearing the application.
Order accordingly.