Fine in Lieu of Forfeiture: Difference between revisions

Latest revision as of 20:05, 24 September 2024

This page was last substantively updated or reviewed October 2023. (Rev. # 96490)

General Principles

See also: Forfeiture of Proceeds of Crime and Restitution

Where the judge finds that property can be forfeited under s. 462.37(1) or (2.01) as "proceeds of crime", the court has the ability order that the offender pay a fine instead where that property is not available for forfeiture.

Purpose of Provision

The purpose of fines in lieu of forfeiture is intended to replace the proceeds of crime with their monetary equivalent.^[1]

Burden

Crown has to prove possession of proceeds of crime.^[2] Not relevant whether the offender personally benefitted.^[3] And not relevant how th eoffendder used proprety or how the money spent.^[4]

Fine-in-Lieu is Not Punishments

An order under s. 462.37 is not a punishment.^[5] However, there is some authority to translate Gladue factors onto the decision to order a fine-in-lieu of forfeiture.^[6]

Requirements

Section 462.37 sets out the requirements for making an order:

462.37
[omitted (1), (2), (2.01), (2.02), (2.03), (2.04), (2.05), (2.06), (2.07), (2.1)]

Fine instead of forfeiture

(3) If a court is satisfied that an order of forfeiture under subsection (1) [order of forfeiture of proceeds of crime] or (2.01) [order of forfeiture of proceeds of crime – particular circumstances] should be made in respect of any property of an offender but that the property or any part of or interest in the property cannot be made subject to an order, the 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. In particular, a court may order the offender to pay a fine if the property or any part of or interest in the property

(a) cannot, on the exercise of due diligence, be located;

(b) has been transferred to a third party;

(c) is located outside Canada;

(d) has been substantially diminished in value or rendered worthless; or

(e) has been commingled with other property that cannot be divided without difficulty.

[omitted (4) and (5)]
R.S., 1985, c. 42 (4th Supp.), s. 2; 1992, c. 1, s. 60(F); 1995, c. 22, s. 10; 1999, c. 5, s. 15(F); 2001, c. 32, s. 19; 2005, c. 44, s. 6; 2015, c. 16, s. 4; 2017, c. 7, s. 59; 2018, c. 16, s. 214; 2018, c. 16, s. 225.
[annotation(s) added]

– CCC (CanLII), (DOJ)

Note up: 462.37 (3)

Defined terms: "Canada" (s. 35 IA), "offender" (s. 2), and "property" (s. 2)

Before exercising discretion in making an order, the judge must be satisfied that:

the money or property, if it exists, is eligible for forfeiture under 462.37!() or (2.01);
the money or property does not in fact exist;
the money or property (a) cannot, on the exercise of due diligence, be located; (b) has been transferred to a third party; (c) is located outside Canada; (d) has been substantially diminished in value or rendered worthless; or (e) has been commingled with other property that cannot be divided without difficulty.

Amount

The fine amount "must represent an amount equal to the accused’s interest in the property which could not be located for forfeiture."^[7]

Possession

The fine can only be made against the offender if they had possession or control of the property at issue at the time of the offence or after.^[8]

Discretion to Order Fine

There is initial discretion on whether or not to make the order.^[9] There is some authority to translate aboriginal identity factors ("Gladue" factors) onto the decision to order a fine-in-lieu of forfeiture.^[10]

There is no discretion under s. 462.37(3) to limit the fine amount to the of the profit as opposed to amount of funds or value of property in possession or control.^[11]

It should not be made as a "mechanical afterthought" and must be part of the consideration of fit and proportionate penalty.^[12]

Factors to Not Impose Fine

There is limited discretion to impose fine-in-lieu.^[13] Factors that courts may want to consider include:^[14]

Was the forfeitable property ever in the actual control or possession of the offender, except perhaps momentarily and in a technical sense?
Did the offender benefit from the criminal activity and, if so, how?
Did the offender have any stake in the ongoing criminal enterprise said to have generated the criminal proceeds?
Has the offender cooperated with the authorities by identifying others engaged in the criminal activity, who played a more significant role than the offender, and who may well be in possession of the proceeds of crime which can be subject to forfeiture, or have the means of paying a fine in lieu of forfeiture? Exercising the discretion to not require a fine in lieu of forfeiture in a way that promoted the recovery of the criminal proceeds or an equivalent fine would promote the objectives of Part XII.2 of the Criminal Code.

Apportionment between Co-Accused

The court may adjust amount to avoid "double recovery" as between those who are convicted.^[15] The parties must be those convicted and cannot be apportioned between those who are unindicted co-accused.^[16]

It is not permitted to decline to make the order on the basis that:

the proceeds were already released to pay for legal fees.^[17]
it may impact rehabilitative prospects.^[18]
the ability to satisfy.^[19]

Ability to Pay

Ability to pay is not to be taken into account in assigning the value to the fine of lieu of forfeiture.^[20]

Instead, the court may alleviate the severity of the fine only by extending the time to pay.^[21]

Fine Option Program

Under s. 462.37(5), the fine options program is not eligible.^[22]

Valuation

The value of property is the "value of the property that was possessed or controlled" by the accused, not the amount of benefit received by the accused.^[23]

Where the accused only keeps part of the money he receives, such as when receiving "buy money" from a drug deal, he could still be fined in the full amount he receives.^[24]

Priority of Orders

A concurrent restitution order can be ordered to take precedent over a fine in lieu of forfeiture. ^[25] Payments made to a restitution order can be used to offset the amount of the fine.^[26]

Constitutionality of s. 462.37(3)

The mandatory order is not unconstitutional as cruel and unusual under s. 12 of the Charter of Rights and Freedoms.^[27]

↑ R v Angelis, 2016 ONCA 675 (CanLII), 340 CCC (3d) 477, per Watt JA, under appeal
↑ R v Vallières, 2022 SCC 10 (CanLII), per Wagner CJ, at para 36
Angelis, supra at para 35
R v Dwyer, 2013 ONCA 34 (CanLII), per Rosenberg JA, at paras 24 to 27
↑ Valliere at para 36
Piccinini, 2015 ONCA 446 at para 19
Siddiqi 2015 ONCA 374 at para 6
↑ Valliere at para 36
Schoer, at para. 105; R. v. Dow, 2014 NBCA 15, 418 N.B.R. (2d) 222, at para. 37; R. v. S. (A.), 2010 ONCA 441, 258 C.C.C. (3d) 13, at para. 14
↑ Angelis, ibid.
Valliere
Lavigne
↑ R v Simpson, 2022 ONSC 6396 (CanLII), per Thomas J
↑ R v Fleming, 2016 ONSC 2805 (CanLII), per Kurke J, at para 22
R v Lavigne, 2006 SCC 10 (CanLII), [2006] 1 SCR 392, per Deschamps J, at paras 10 to 21, 29 to 37, 44
↑ R. v. Dwyer (2013), 2013 ONCA 34 (CanLII), 2013 CarswellOnt 600, 296 C.C.C. (3d) 193 (Ont. C.A.), additional reasons 2013 CarswellOnt 5767, 2013 ONCA 306.
↑ R v Vallieres, 2022 SCC 10 (CanLII), per Wagner J, at para 35 ("judicial discretion applies first to the decision whether or not to impose a fine and second to the determination of the value of the property")
↑ Simpson, supra
↑ Vallieres, supra, at para 26
↑ Siemens, supra at para 10
↑ R v Abdelrazzaq, 2023 ONCA 112 (CanLII), per Doherty JA
↑ Abdelrazzaq, ibid.
↑ Valliere, ibid.
↑ Valliere, ibid.
↑ R v Rafilovich, 2017 ONCA 634 (CanLII), 353 CCC (3d) 293, per Pardu JA
↑ Angelis, supra
↑ Angelis, supra
↑ Fleming, supra, at para 22
Angelis, supra
↑ Fleming, supra, at para 22
Lavigne, supra, at paras 45 to 48
↑ see art. 736(5).
↑ R v Piccinini, 2015 ONCA 446 (CanLII), per curiam, at para 19
↑ Fleming, supra, at paras 29 to 32
R v AS, 2010 ONCA 441 (CanLII), 258 CCC (3d) 13, per curiam, at para 14
↑ Walker, supra, at para 113
↑ Walker, supra, at para 113
R v Dhanaswar, 2016 ONCA 229 (CanLII), per curiam
↑ R v Abdelrazzaq, 2023 ONCA 112 (CanLII), per Doherty JA
R v Chung, 2021 ONCA 188 (CanLII), per curiam

Fine Option Program

Under s. 462.27(5), the fine options program is not eligible:

462.37
[omitted (1), (2), (2.01), (2.02), (2.03), (2.04), (2.05), (2.06), (2.07), (2.1), (3) and (4)]

Fine option program not available to offender

(5) Section 736 [fine option program] does not apply to an offender against whom a fine is imposed pursuant to subsection (3) [order of forfeiture of proceeds of crime – fine instead of forfeiture].
R.S., 1985, c. 42 (4th Supp.), s. 2; 1992, c. 1, s. 60(F); 1995, c. 22, s. 10; 1999, c. 5, s. 15(F); 2001, c. 32, s. 19; 2005, c. 44, s. 6; 2015, c. 16, s. 4; 2017, c. 7, s. 59; 2018, c. 16, s. 214; 2018, c. 16, s. 225.
[annotation(s) added]

– CCC (CanLII), (DOJ)

Note up: 462.37 (5)

Defined terms: "offender" (s. 2)

Conditions of Order

The court may impose any terms of payment including a payment schedule.^[1]

Variations on Conditions

The offender is permitted to ask for a variation in the terms of payment, including extending the time to pay, after defaulting on the payment.^[2]

↑ R v Abdelrazzaq, 2023 ONCA 112 (CanLII), per Doherty JA, at para 58
↑ Abdelrazzaq, ibid., at para 60
see also R. v. Yamelst (1975), 1975 CanLII 1348 (BC SC), 22 C.C.C. (2d) 502 (B.C.S.C.), at pp. 508-9.

Time to Pay

Where a judge makes an order for a fine in lieu of forfeiture, a time is set in which to pay. Failure to make the payment in the requisite time may result in further jail time.

No Maximum of Time

There is no limit on the amount of time that an offender can have to pay the fine.^[1] Ability to pay is a valid consideration on setting the time to pay.^[2]

Start of Time to Pay

Normal calculation of the time-to-pay begins after the accused is released from custody.^[3]

Extensions

The fine provisions permit the offender to be granted as many adjournments as is necessary.^[4]

The offender is able to ask for extensions even after he is in default.^[5]

Payment Schedules

The court may order a payment schedule or any other terms of payment.^[6]

↑ R v Abdelrazzaq, 2023 ONCA 112 (CanLII), per Doherty JA, at para 58
↑ Abdelrazzaq, ibid., at para 58
R v Lavigne, 2006 SCC 10 (CanLII), [2006] 1 SCR 392, per Deschamps J, at paras 47 to 48
↑ Abdelrazzaq, ibid. Maxwell, 2014 ONCA 316, at para. 9
↑ Abdelrazzaq, supra
↑ R. v. Yamelst (1975), 1975 CanLII 1348 (BC SC), 22 C.C.C. (2d) 502 (B.C.S.C.), at pp. 508-9
R. v. Abdelrazzaq, 2023 ONCA 112 (CanLII), at para 60, <https://canlii.ca/t/jvqnv#par60>
↑ Abdelrazzaq, supra
see also s. 734.1

Default

An offender who does not pay the fine in the time alotted will be in default and liable to a jail sentence.

Most but not all the provisions found in Part XXIII relating to fines will apply.^[1]

Procedure

Where the time has expired the court may conduct a "committal hearing" to impose a default penalty.^[2] The offender is compelled summons or warrant.^[3]

Preconditions

Before a prison sentence is ordered the court must be satisfied that an "alternative enforcement measures in s. 734.5 (licence suspensions and denials), and s. 734.6 (civil judgments) are not an appropriate"^[4]

The court must be "satisfied that the offender has without reasonable excuse refused to pay the fine".^[5]

"Refused to Pay"

The meaning of "refused to pay" requires a "wilful refusal" and not merely non-payment based on an "inability to pay because of poverty".^[6]

↑ R. v. Abdelrazzaq, 2023 ONCA 112 (CanLII), at para 58, <https://canlii.ca/t/jvqnv#par58>, retrieved on 2024-08-19
↑ Abdelrazzaq, ibid. at para 61
↑ Abdelrazzaq, ibid. at para 61
↑ Abdelrazzaq, ibid. at para 61
see Fines#Civil_Enforcement_of_Fines re 734.6
↑ Abdelrazzaq, ibid. at para 62
see also 734.7(1)(b)9ii)
↑ Abdelrazzaq, ibid. at para 62
R v Chung, 2021 ONCA 188, 402 C.C.C. (3d) 145, at paras. 104, 160

Default Time

The period of imprisonment for failure to pay the fine is an enforcement mechanism to encourage payment.^[1]

Section 462.37(4) addresses default penalties:

462.37
[omitted (1), (2), (2.01), (2.02), (2.03), (2.04), (2.05), (2.06), (2.07), (2.1) and (3)]

Imprisonment in default of payment of fine

(4) Where a court orders an offender to pay a fine pursuant to subsection (3) [order of forfeiture of proceeds of crime – fine instead of forfeiture], the court shall

(a) impose, in default of payment of that fine, a term of imprisonment
(i) not exceeding six months, where the amount of the fine does not exceed ten thousand dollars,

(ii) of not less than six months and not exceeding twelve months, where the amount of the fine exceeds ten thousand dollars but does not exceed twenty thousand dollars,

(iii) of not less than twelve months and not exceeding eighteen months, where the amount of the fine exceeds twenty thousand dollars but does not exceed fifty thousand dollars,

(iv) of not less than eighteen months and not exceeding two years, where the amount of the fine exceeds fifty thousand dollars but does not exceed one hundred thousand dollars,

(v) of not less than two years and not exceeding three years, where the amount of the fine exceeds one hundred thousand dollars but does not exceed two hundred and fifty thousand dollars,

(vi) of not less than three years and not exceeding five years, where the amount of the fine exceeds two hundred and fifty thousand dollars but does not exceed one million dollars, or

(vii) of not less than five years and not exceeding ten years, where the amount of the fine exceeds one million dollars; and

(b) direct that the term of imprisonment imposed pursuant to paragraph (a) be served consecutively to any other term of imprisonment imposed on the offender or that the offender is then serving.

[omitted (5)]
R.S., 1985, c. 42 (4th Supp.), s. 2; 1992, c. 1, s. 60(F); 1995, c. 22, s. 10; 1999, c. 5, s. 15(F); 2001, c. 32, s. 19; 2005, c. 44, s. 6; 2015, c. 16, s. 4; 2017, c. 7, s. 59; 2018, c. 16, s. 214; 2018, c. 16, s. 225.

– CCC (CanLII), (DOJ)

Note up: 462.37 (4)

Section 462.37 imposes the following range of penalties:

Section	Imprisonment	Fine Amount
462.37(4)(a)(i)	0 to 6 months	0 to $10,000
462.37(4)(a)(ii)	6 to 12 months	$10,000 to $20,000
462.37(4)(a)(iii)	12 to 18 months	$20,000 to $50,000
462.37(4)(a)(iv)	18 to 24 months	$50,000 to $100,000
462.37(4)(a)(v)	2 to 3 years	$100,000 to $150,000
462.37(4)(a)(vi)	3 to 5 years	$150,000 to $1,000,000
462.37(4)(a)(vii)	5 to 10 years	$1,000,000 or more

Rehabilitation

It is not appropriate to decline to order a fine because it may affect rehabilitation or there are issues with the ability to pay.^[2] The order is not intended to undermine rehabilitation.^[3]

Ability to Pay

The offender's ability to pay is not a relevant factor in failure to pay.^[4]

↑ R v Dritsas, 2015 MBCA 19 (CanLII), 19 CR (7th) 203, per Monnin JA
↑ Angelis R v Walker, 2016 ABQB 695 (CanLII), per Ackerl J, at para 109
↑ R v Biegus, 1999 CanLII 3815 (ON CA), 141 CCC (3d) 245, per Feldman JA, at paras 15 and 22
↑ Walker, ibid., at para 109

Imposing Imprisonment on Default

Before the court can impose a custodial sentence it must be "satisfied that the alternative enforcement measures in s. 734.5 (licence suspensions and denials), and s. 734.6 (civil judgments) are not an appropriate" as a means to enforce the fine.^[1]

↑ R v Abdelrazzaq, 2023 ONCA 112 (CanLII), per Doherty JA