Old Age Security (OAS) and Guaranteed Income Supplement (GIS)

Reasons and decision

[1] The Appeal Division of the Social Security Tribunal of Canada, (the Tribunal), refuses leave to appeal.

Introduction

[2] The Applicant currently resides in X in the United States of America, (the US). On July 11, 2013, the Respondent received his application for Old Age Security Act, (OAS), benefits pursuant to the Canada - US Agreement on Social Security, (the Agreement). (GD2-9) The Respondent denied the application. It upheld the denial on reconsideration. The Applicant appealed from the reconsideration decision to the General Division of the Tribunal.

[3] At issue, was whether the Applicant had twenty years of combined residency in Canada and the United States of America, (the US) and could, therefore, benefit from the operation of Article VI of the Agreement.

[4] In its decision issued on June 24, 2016, the General Division concluded that the Applicant did not have the required twenty years of combined residency. Thus, he was not eligible to receive a pension under the OAS Act.

[5] The Applicant applies for leave to appeal the General Division decision, (the Application).

Grounds of the application

[6] In this Application, the Applicant continues to rely on Articles VIII and IX of the Second Supplement to the Agreement. He submits that the General Division erred in law when it made its decision as it did not address:-

1. The issue of whether “factual residence” was equivalent to “deemed residence” for the purposes of the OAS Act: a distinction he claims was absent from Articles VIII and IX of the Second Supplement to the Agreement (Articles VIII and IX); or
2. Whether the definition of “deemed residence” in Article VI of the Agreement applied equally to employed and unemployed persons. He stated his belief that Articles VIII and IX of the second supplement to the Agreement make no such distinction.

[7] As well, he submitted that his case could be distinguished from that of the appellant in Gumboc v. Canada (Attorney General) 2014 FC 185 on which the General Division relied. The Applicant stated that the distinguishing factor resided in the fact that, unlike Gumboc, he is a Canadian citizen. (AD1-2)

Issue

[8] The Appeal Division must decide the issue of whether the appeal has a reasonable chance of success.

The law

[9] Subsections 56(1) and 58(3) of the Department of Employment and Social Development, (DESD Act) govern the grant of leave to appeal. Subsection 56(1) provides that “an appeal to the Appeal Division may only be brought if leave to appeal is granted.” Thus, leave to appeal a decision of the General Division of the Tribunal is a preliminary step to an appeal before the Appeal Division.

[10] Subsection 58(3) provides that “the Appeal Division must either grant or refuse leave to appeal.” In order to obtain leave to appeal, an applicant must satisfy the Appeal Division that their appeal would have a reasonable chance of success; otherwise the Appeal Division must refuse leave to appeal.^{Footnote 1} In Canada (Attorney General) v. O’Keefe 2016 FC 503, the Federal Court examined the jurisdiction of the Appeal Division to grant leave to appeal, stating that:-

[36] Leave to appeal a decision of the SST-GD may be granted only where a claimant satisfies the SST-AD that their appeal has a “reasonable chance of success” on one of the three grounds of appeal identified in subsection 58(1) of the DESDA: (a) a breach of natural justice; (b) an error of law; or (c) an erroneous finding of fact made in a perverse and capricious manner or without regard for the material before it. No other grounds of appeal may be considered (Belo-Alves, above, at paras 71-73)

[11] An applicant satisfies the Appeal Division that his appeal would have a reasonable chance of success by raising an arguable case in his application for leave:^{Footnote 2} Canada (Minister of Human Resources Development) v. Hogervorst, 2007 FCA 41; Fancy v. Canada (Attorney General), 2010 FCA 63.

[12] Subsection 58(1) of the DESD Act sets out the only three grounds of appeal, namely:-

1. The General Division failed to observe a principle of natural justice or otherwise acted beyond or refused to exercise its jurisdiction;
2. The General Division erred in law in making its decision, whether or not the error appears on the face of the record; or
3. The General Division 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.

[13] Tracey v. Canada (Attorney General), 2015 FC 1300 supports the view that in assessing an application for leave to appeal the Appeal Division must first determine whether any of the Applicant’s reasons for appeal fall within any of the stated grounds of appeal.

Analysis

[14] In raising this point, the Applicant is revisiting an issue he raised before the General Division. The concept of “deemed residence” appears in Article VIII. It refers back to Article VI of the Agreement and to periods of residence in the US, that are to be treated as periods of residence in Canada in order to establish an applicant’s eligibility for an OAS pension. The Applicant argues that the General Division ought to have ruled, expressly, on whether the concepts of “deemed residence” and “actual residence” were the same for the purposes of his eligibility for an OAS pension. The Applicant’s complete submissions are:-

1. “Articles 8 and 9 of Second supplement of the US-Canada Social Security agreement are addressing the questions of eligibility and payment of OAS pension to the person (who) lived outside Canada. Unfortunately the following questions were not clearly addressed in the letter of denial:
2. Is factual residence in Canada and deemed residence in Canada equivalent for OAS pension eligibility determination? Canada Tax Code considers them to be equivalent.
3. Is (the) definition of deemed residence in article 6 US-Canada Agreement applied equally to the employed and unemployed persons? Is this definition essentially means residence in the US for both employed and unemployed persons? This distinction is absent in articles 8 and 9.
4. If there is no difference between factual and deemed residency (as I believe is the case), then I am eligible for OAS pension.
5. I found one important difference between Mr. Gumboc and myself. As a naturalized US citizen he was required to state under oath that he is renouncing his old citizenship. And conduct inconsistent with this pledge could theoretically lead to loss of one's US status. I am a Canadian citizen.” (AD1-2)

The deeming provision in Article VIII

[15] Under Article VIII, an applicant for an OAS pension may be able to rely on periods deemed as residence in Canada under Article VI of the Agreement, in making his or her application.

Article VIII

1. 1) (a) - If a person is not entitled to the payment of a benefit because he or she has not accumulated sufficient periods of residence under the Old Age Security Act, or periods of coverage under the Canada Pension Plan, the entitlement of that person to the payment of that benefit shall, subject to sub-paragraph (1)(b), be determined by totalizing these periods and those specified in paragraph (2), provided that the periods do not overlap.
2. (b) In the application of sub-paragraph (1)(a) of this Article to the Old Age Security Act:
3. (i) only periods of residence in Canada completed on or after January 1, 1952, including periods deemed as such under Article VI of this Agreement, shall be taken into account.

[16] The Appeal Division finds that the General Division correctly identified the applicable statutory provisions governing eligibility for a pension under the OAS Act. Further, the General Division specifically identified subsection 3(2) of the OAS Act as applying to payment of a partial pension. The General Division acknowledged that as the Applicant lived in the US it was necessary to assess his eligibility for an OAS pension under the Agreement. (Paragraph 10). In this regard, it considered his submission that, by virtue of Articles VIII and IX he was eligible for an OAS pension.

[17] The Appeal Division finds that, in its analysis of the facts of the Applicant’s case and the relevant law, the General Division addressed the question squarely. It showed, by reference to a Federal Court of Canada decision, how a reviewing court had analysed similar issues. In the view of the Appeal Division, Gumboc v. the Attorney General of Canada, 2014 FC 185 addressed the very questions raised by the Applicant, that is, whether Articles VIII and IX allowed him to claim benefit of Article VI of the Agreement. At paragraph 36 of its decision, the Federal Court set out the issues as:

1. Does the applicant meet the residency requirements contained at subsection 3(1) of the OAS Act necessary to qualify for a full OAS pension?
2. If the applicant does not meet those residency requirements, does the Canada/U.S. Agreement allow the applicant to claim an OAS pension?

[18] The Appeal Division finds that, from the point of view of the issues, Gumboc is on “all fours’ with the Applicant’s case.

[19] In Gumboc, the Federal Court addressed the issue of deemed or notional residence. At paragraph 5 of its decision, it noted that, “The minimum period of residency necessary to qualify for a partial pension is ten years of residence in Canada. In determining residence, only actual residence and not periods of physical presence in Canada are counted.” In any event, Gumboc was also a Canadian citizen as the Federal Court found that he became on May 4. 1978. (paragraph 32)

[20] The Federal Court elaborated further on this question of “deemed residence” at paragraph 56, stating, “Article VIII of the Agreement allows applicants who have not accumulated the required years of residence to qualify for a partial pension by using their periods of coverage in the U.S. to establish a notional residence in Canada.”

[21] At paragraph 27 of its decision, the General Division addressed the issue of deemed or notional residence. By submitting that it ought to have made an express ruling on the meaning and applicability of the two concepts, the Applicant, in the view of the Appeal Division, is asking the General Division to make a determination that is not required for the purpose of determining whether or not he met the required residency for the grant of an OAS pension.

[22] The issue in the Applicant’s case is clearly as that which was formulated by the Federal Court in Gumboc: did the Applicant reside in Canada for the period required to render him eligible for an OAS pension, whether full or partial? If not, could his period of residence in the US be deemed to be residence in Canada, pursuant to the Agreement? Section 3 of the OAS Act makes it clear that eligibility for a pension is based on “actual” residence in Canada, while Article VIII works to modify the rigidity of Section 3 by allowing “deemed or notional” residence in the US to be taken into consideration when assessing the residency requirement. The General Division decision was rendered in this context. Thus, the Appeal Division finds that it was not necessary for the General Division to make the distinction proposed by the Applicant. No error of law can be found in this regard.

[23] Overall, the Appeal Division is satisfied that the General Division correctly identified the issue, the legislation, the relevant test, and the relevant case law. It did not commit an error of law, whether or not the error appears on the face of the record; nor did it base 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. Consequently, the Appeal Division is not satisfied that the Applicant’s submissions disclose grounds of appeal that have a reasonable chance of success.

Did the General Division err in applying Gumboc?

[24] The Applicant argued that the General Division erred in applying the decision of the Federal Court in Gumboc to his case. He relies on the fact that he is a Canadian citizen. He states that Gumboc was not. If this were true, the Appeal Division is of the view, this is a distinction without a difference as it eligibility for an OAS pension is based on residence not citizenship.^{Footnote 3} As the Federal Court made clear in Gumboc, “residence is a question of fact to be determined according to the particular circumstances (Perera v Canada (Minister of Health and Welfare) (1994), 75 FTR 310 [Perera]) and in line with the evidence offered by an applicant for a pension. The burden of proof is on the applicant.”

[25] Furthermore, Mr. Gumboc was, in fact a Canadian citizen, having obtained citizenship in 1998,^{Footnote 4} which fact undermines and renders null, the distinction proposed by the Applicant.

Conclusion

[26] The Applicant submitted that the General Division erred in law, breaching paragraph 58(1)(b) of the DESD Act. For the reasons set out above the Appeal Division is not satisfied that his arguments raise grounds of appeal that would have a reasonable chance of success. The Appeal Division finds that the General Division did not commit any reviewable errors, in that it correctly identified the issue, the legislation, the relevant test, and the relevant case-law.

[27] The Application is refused.

Schedule I

OAS provisions

1. 3. (1) Subject to this Act and the regulations, a full monthly pension may be paid to
   1. (a) every person who was a pensioner on July 1, 1977;
   2. (b) every person who
      1. (i) on July 1, 1977 was not a pensioner but had attained twenty-five years of age and resided in Canada or, if that person did not reside in Canada, had resided in Canada for any period after attaining eighteen years of age or possessed a valid immigration visa,
      2. (ii) has attained sixty-five years of age, and
      3. (iii) has resided in Canada for the ten years immediately preceding the day on which that person’s application is approved or, if that person has not so resided, has, after attaining eighteen years of age, been present in Canada prior to those ten years for an aggregate period at least equal to three times the aggregate periods of absence from Canada during those ten years, and has resided in Canada for at least one year immediately preceding the day on which that person’s application is approved; and
   3. (c) every person who
      1. (i) was not a pensioner on July 1, 1977,
      2. (ii) has attained sixty-five years of age, and
      3. (iii) has resided in Canada after attaining eighteen years of age and prior to the day on which that person’s application is approved for an aggregate period of at least forty years.

Subject to this Act and the regulations, a partial monthly pension may be paid for any month in a payment quarter to every person who is not eligible for a full monthly pension under subsection

1. (1) and
2. (a)  has attained sixty-five years of age; and
3. (b) has resided in Canada after attaining eighteen years of age and prior to the day on which that person's application is approved for an aggregate period of at least ten years but less than forty years and, where that aggregate period is less than twenty years, was resident in Canada on the day preceding the day on which that person's application is approved.

Schedule II

The Canada-United States Agreement on Social Security

Article VI

1. Except as otherwise provided in this Article, where a person referred to in Article V(2) is subject to the laws of Canada, or the comprehensive pension plan of a province, during any period of residence in the territory of the United States, that period of residence, in respect of that person, his spouse and dependents who reside with him and who are not employed or self-employed during that period, shall be treated as a period of residence in Canada for the purposes of the Old Age Security Act.

Article VIII

1. (1) (a) - If a person is not entitled to the payment of a benefit because he or she has not accumulated sufficient periods of residence under the Old Age Security Act, or periods of coverage under the Canada Pension Plan, the entitlement of that person to the payment of that benefit shall, subject to sub-paragraph (1)(b), be determined by totalizing these periods and those specified in paragraph (2), provided that the periods do not overlap.
2. (b) In the application of sub-paragraph (1)(a) of this Article to the Old Age Security Act:
3. (i) only periods of residence in Canada completed on or after January 1, 1952, including periods deemed as such under Article VI of this Agreement, shall be taken into account.

Article IX

1. (1) If a person is entitled to the payment of an Old Age Security pension or a spouse’s allowance solely through the application of the totalizing provisions of Article VIII, the agency of Canada shall calculate the amount of the pension or spouse’s allowance payable to that person in conformity with the provisions of the Old Age Security Act governing the payment of a partial pension or a spouse’s allowance, exclusively on the basis of the periods of residence in Canada on or after January 1, 1952 which may be considered under that Act or are deemed as such under Article VI of this Agreement.
2. (2) Paragraph (1) shall also apply to a person outside Canada who would be entitled to the payment of a full pension in Canada but who has not resided in Canada for the minimum period required by the Old Age Security Act for entitlement to the payment of a pension outside Canada.
3. (3) Notwithstanding any other provision of this Agreement:
4. (a)an Old Age Security pension shall be paid to a person who is outside Canada only if that person’s periods of residence, totalized as provided in Article VIII, are at least equal to the minimum period of residence in Canada required by the Old Age Security Act for entitlement to the payment of a pension outside Canada; and
5. (b) a spouse’s allowance and a guaranteed income supplement shall be paid to a person who is outside of Canada only to the extent permitted by the Old Age Security Act.