Employment Insurance (EI)

Decision

[1] The appeal is dismissed. The rule of issue estoppel should not be applied.

Overview

[2] The Appellant (Claimant) applied for Employment Insurance (EI) benefits effective December 8, 2019. The Respondent, the Canada Employment Insurance Commission (Commission), decided that the Claimant did not qualify for benefits because she was not without work and without earnings for seven consecutive days, since she had received a benefit: an employer-paid cell phone.

[3] The Claimant requested a reconsideration of this decision, but the Commission upheld its initial decision. The Claimant appealed the reconsideration decision to the General Division.

[4] The General Division found that the Claimant had not had an interruption of earnings for at least seven consecutive days because she had an employer-paid cell phone.

[5] The Claimant was granted leave (permission) to appeal the General Division’s decision. She says that the General Division made an error of law or refused to exercise its jurisdiction by not applying the rule of estoppel, given an earlier decision by the Commission that was favourable to the Claimant.

[6] I am dismissing the Claimant’s appeal.

Issue

[7] Did the General Division make an error of law or refuse to exercise its jurisdiction by not applying the rule of estoppel, given an earlier decision by the Commission that was favourable to the Claimant?

Analysis

Appeal Division’s mandate

[8] The Federal Court of Appeal has established that the Appeal Division’s mandate is conferred to it by sections 55 to 69 of the Department of Employment and Social Development Act.^{Footnote 1}

[9] The Appeal Division acts as an administrative appeal tribunal for decisions made by the General Division and does not exercise a superintending power similar to that exercised by a higher court.

[10] So, unless the General Division failed to observe a principle of natural justice, made an error of law, or based its decision on an erroneous finding of fact that it made in a perverse or capricious manner or without regard for the material before it, I must dismiss the appeal.

Did the General Division make an error of law or refuse to exercise its jurisdiction by not applying the rule of estoppel, given an earlier decision by the Commission that was favourable to the Claimant?

[11] Since 1999, the Claimant has worked the same seasonal job in a hotel in the city of Québec. For her job, she uses a cell phone provided by her employer. She is still allowed to use it even after her job ends.

[12] On February 8, 2016, the Commission asked for repayment of the EI benefits paid to the Claimant in connection with the job she had in 2015. The Commission argued that her continued use of the employer-provided cell phone after her job was over meant that she was not entitled to such benefits.

[13] Following a reconsideration request and many discussions with the Claimant, the Commission reconsidered its decision on April 21, 2016 (2016 decision), and decided in favour of the Claimant, who was able to keep the EI benefits she had received.

[14] On June 12, 2020, the Commission asked the Claimant to repay the EI benefits paid in connection with the job she had in 2019, for the same reason given in 2016. On October 7, 2020, the General Division upheld the Commission’s decision.

[15] The General Division found that the Claimant had not had an interruption of earnings for at least seven consecutive days because she had an employer-paid cell phone. This meant that the Claimant did not meet the conditions required to have a benefit period established effective December 8, 2019.

[16] Based on the General Division’s decision, the Commission looked at the Claimant’s file again, this time in connection with the benefits paid for 2016, 2017, and 2018. In three decisions made on April 20, 2021, the Commission asks for repayment of the EI benefits for the same reason given in 2016. The Commission’s three decisions are currently under appeal before the General Division.

[17] The Claimant says that the General Division made an error of law or jurisdiction by not applying the rule of issue estoppel (res judicata) to the final decision the Commission made in 2016.

[18] The Claimant argues that the 2016 decision definitively addressed the contentious issues between the parties. She points out that the General Division raised this point in its decision but did not decide the issue.^{Footnote 2}

[19] The Commission is of the opinion that the General Division did not make an error by not considering the rule of estoppel. It argues that the Claimant did not raise this point before the General Division. The Commission says that the General Division correctly exercised its discretion when it decided not to consider the rule of estoppel.

[20] The Commission also says that the rule of estoppel does not apply, since the benefit period that this appeal is based on is not the same benefit period for which the Commission made its 2016 decision.

[21] For the reasons that follow, I am of the view that the General Division made an error of law or refused to exercise its jurisdiction by not considering the rule of estoppel regarding the 2016 decision. It is clear that the failure to consider its application risked an injustice to the Claimant.^{Footnote 3} So, I will give the decision that the General Division should have given.^{Footnote 4}

[22] The theory of issue estoppel simply means that once a material fact such as a mistake is found to exist (or not to exist) by a court or tribunal of competent jurisdiction, whether on the basis of evidence or admissions, the same issue cannot be relitigated in subsequent proceedings between the same parties.^{Footnote 5}

[23] These rules were initially developed in the context of prior court proceedings. They have since been extended, with some necessary modifications, to decisions classified as being of a judicial or quasi-judicial nature pronounced by administrative officers and tribunals.^{Footnote 6}

[24] One of the preconditions to estoppel is the fundamental requirement that the decision in the prior proceeding be a judicial decision.

[25] In the present case, the Commission agents have the power to investigate and to adjudicate. Their investigation is made for the purpose of providing them with information on which to base the decision they must make. The duties of the Commission agents embrace all the important indicia of the exercise of a judicial power including the ascertainment of facts, the application of the law to those facts, and the making of a decision which is binding upon the parties.

[26] Agents must decide whether claimants qualify for benefits. While they utilize procedures more flexible than those that apply in the courts, the decision must be based on findings of fact and the application of an objective legal standard to those facts. This is characteristic of a judicial function.

[27] It is true that this involves a Commission agent. This does not have the effect of eliminating the agent’s duty to act judicially. Also, the law makes it possible to appeal the agent’s decision to the General Division, which eliminates this element of apparent inequality in the appeal process.^{Footnote 7}

[28] I am of the view that the decision of a Commission agent who determines whether a claimant qualifies for EI after getting the relevant information is a judicial decision.

[29] This means that the criteria for applying this theory should be considered:

1. (1) that the same question has been decided
2. (2) that the judicial decision was final
3. (3) that the parties to the judicial decision or their privies were the same persons^{Footnote 8}

[30] In my view, there is no doubt in this case that the 2016 decision has all the characteristics of a final decision. It was not subject to an appeal and was even applied by the Commission, which wrote off the Claimant’s overpayment. That meets the second criterion.

[31] The identity of the parties criterion is also met. The final decision of 2016 and the appeal before the General Division involve the same parties.

[32] However, after careful consideration, I am of the view that the first criterion regarding the existence of a “same question” is not met.

[33] In my view, in the case of the 2016 decision, the right, question, or fact that was determined must, as between the parties, be taken to be conclusively established so long as the judgment remains.

[34] As a result, the issue decided in 2016, namely, that the Claimant had an interruption of earnings even though she had an employer-paid cell phone, cannot be relitigated regarding the 2015 EI claim.

[35] It is important to understand that the rule of estoppel extends to the issues of fact, law, and mixed fact and law that are necessarily bound up with the determination of the issue that was decided, namely, the interruption of earnings related to the 2015 claim.

[36] I find that the Commission here is not trying to challenge its 2016 decision, after reviewing the facts and applying the law. It is not trying to recover the benefits that were paid to the Claimant in 2015 through another course of action. The issue of interruption of earnings in 2015 was decided in the Claimant’s favour, and it cannot be brought before the Tribunal again to the harassment of the Claimant, who won.

[37] This case is about the 2019 EI claim. The Employment Insurance Act specifically says that EI benefits are payable to an insured person who qualifies to receive them.^{Footnote 9} The Commission disagrees that the Claimant is entitled to receive EI for the 2019 claim, since she did not have an interruption of earnings. That is one of the essential conditions to receive benefits.^{Footnote 10}

[38] Since the Commission is not trying to indirectly challenge the issue decided in the 2016 decision, I see no potential inconsistent results or duplication.

[39] Despite the very able submissions of the Claimant’s representative, I am of the view that what was decided in the 2016 decision involves the issue of interruption of earnings for the related benefit period, not whether the Claimant qualifies for any later EI claim.

[40] If issue estoppel applied for the claims that came after the 2016 decision, this would have the effect of preventing the Commission from deciding whether the Claimant met the qualifying conditions for EI by considering the facts and the applicable law at the time of application.

[41] Since the condition regarding the existence of a “same question” is not met, I have no choice but to find that the rule of issue estoppel does not apply.

[42] That being said, I want to point out that I sympathize with the Claimant, who finds herself in an unfortunate situation given the Commission’s late intervention.

False or misleading statement

[43] The Claimant is asking me to find that she did not make any false or misleading statements in her claim for EI benefits for 2019.

[44] The Commission initially decided that the Claimant was not without work and without earnings for at least seven consecutive days before the beginning of her benefit period starting December 8, 2019. The Commission’s initial decision was upheld on reconsideration.

[45] The Commission did not impose a penalty on the Claimant for making a false or misleading statement in relation to her claim for EI benefits for 2019. As a result, the only issue before the General Division involved the interruption of earnings.

[46] This means that I do not have the authority to find that the Claimant did not make any false or misleading statements in her claim for EI benefits for 2019, since the General Division’s decision does not involve imposing a penalty.

Conclusion

[47] For the reasons above, the appeal should be dismissed.