Where an accused has permission to use proceeds of crime to pay for defence, a fine cannot be imposed in lieu of forfeiture at sentencing
Where an accused person has used (with permission) the proceeds of crime to pay for a legal defence, they should not generally be required to pay the court a fine equal to those proceeds following their conviction, the Supreme Court ruled today in a 6/3 decision.
In R. v. Rafilovich, the majority of the Supreme Court found that it was unfair to demand those funds back from the accused following conviction. The accused was presumed innocent at trial, and a lack of funds available to them could jeopardize their ability to obtain defence counsel. Under the proceeds of crime regime, imposing a fine in lieu of forfeiture was intended to prevent accused from spending or hiding the proceeds of crime.
“The presumption of innocence, the right to a fair trial and the right to counsel trumps the principle that crime doesn’t pay,” Michael Bryant says of the decision.
“The law doesn’t allow the Crown to charge someone and then raid their defence fund,” says Bryant, who is Executive Director and General Counsel of the Canadian Civil Liberties Association, an intervener in the case. “And that’s what we were fighting over.”
Yulik Rafilovich was charged with multiple drug-trafficking offences. When executing search warrants, the police seized sums of money totalling over $42,000 (Cdn), and about $47,000 worth of cocaine from his car and apartment. Rafilovich had no monies available for legal fees and did not qualify for legal aid. He applied pursuant to s. 462.34(4) of the Criminal Code to be permitted to utilize the seized funds to meet reasonable legal expenses.
A judge of Ontario’s Superior Court of Justice granted the application and ordered all seized funds to be released to defence counsel to meet Rafilovich’s legal expenses. Rafilovich pleaded guilty to five charges, and the seized funds were determined to be proceeds of crime.
At the sentencing hearing, the Crown requested an order imposing a fine in lieu of forfeiture of $41,976.39 (Cdn). Under s. 462.37 of the Criminal Code, a “court may, instead of ordering the property or any part of or interest in the property to be forfeited, order the offender to pay a fine in an amount equal to the value of the property or the part of or interest in the property.”
The sentencing judge imposed a term of imprisonment and forfeiture of Rafilovich’s interest in an apartment, but did not grant a fine in lieu of forfeiture. One reasons for this decision was because, she found, the non-payment of the fine would lead to the imposition of a further sentence of imprisonment of 12 to 18 months, which offenders with access to funds or legal aid would not have to face. Crown counsel appealed, and the Court of Appeal allowed the appeal and ordered the fine be paid in lieu of forfeiture.
In today’s judgment, the majority of the Supreme Court found that the statutory discretion to impose a fine instead of forfeiture under s. 462.37(3) of the Criminal Code must be exercised in accordance with the purposes of the proceeds of crime regime. Parliament foresaw the possibility that seized funds may be needed to mount a defence, and allowed individuals to spend the returned funds for this purpose.
The “return provision” fulfils the secondary purposes of the proceeds of crime regime, by providing access to counsel and giving meaningful weight to the presumption of innocence, Justice Sheilah Martin wrote for the majority. Exceptions to this provision include where an accused has misrepresented his financial situation, where the funds were ultimately misused, or where the accused has experienced a change in circumstance.
In this decision, “the court has created a safe harbour for the use of seized funds for legal fees where an accused has no other available resources,” says Toronto criminal lawyer Alan Gold, who represented the intervener Criminal Lawyers’ Association of Ontario in the case.
“The court,” he said, “accepted that the judicial return of funds to pay for a lawyer is not the type of benefit that Parliament sought to take away by way of a fine [and] that spending funds on a lawyer is in furtherance of constitutional rights and serves a public interest as well as an accused's.”
In reasons that dissented in part, Justice Michael Moldaver, also writing for Chief Justice Richard Wagner and Justice Suzanne Côté, found that, in keeping with “the primary objective of the proceeds of crime regime — namely, ensuring that crime does not pay” -- there should be a fine imposed except where, on sentencing, the sentencing judge finds that representation by counsel was necessary to preserve the offender’s constitutional right to a fair trial under the sections 7 and 11 Charter.
This would invoke a Rowbotham scenario, whereby the state is required to fund an accused’s legal defence under a narrow set of circumstances. In the case before the court, Justice Moldaver noted that the sentencing judge had not considered whether representation by counsel was essential to Rafilovich’s constitutional right to a fair trial, and that the matter would need to be sent back to the sentencing judge for determination.
But imposing a fine to recoup funds used by an accused to pay his or her defence counsel, funds taken (with a judge’s permission) from the proceeds of crime in advance of a trial, “is simply impractical, because it would saddle people with a debt that they couldn’t pay,” says Bryant.