Henry Sztern

Criminal Code Decisions

Important Notice:

The English PDF version of this document is the official version. In the event of an inconsistency between the HTML and PDF version, the English PDF version prevails.

What is a Criminal Code decision?

In the course of an investigation into a trustee’s professional conduct, if the investigator has concerns, based upon reasonable grounds, that the trustee may have committed an offence as set out in the Bankruptcy and Insolvency Act or in the Criminal Code, the matter may also be referred to the Royal Canadian Mounted Police for investigation. Charges leading to judgment and sentencing may be filed against the trustee.

court of quebec
Criminal and Penal Division

canada
province of quebec
district of montreal
city of montreal

No: 500-01-009014-082

DATE:


in the presence of : the honourable Louis A. legault, j.c.q.


the queen
Prosecutor

v.
Henry sztern
Accused


sentence
(written reasons)


[1] The accused has pleaded guilty to 5 counts of fraud against the creditors of several bankrupt companies or persons as he was then acting as a trustee to these bankruptcies.

objective gravity

[2] These offences are punishable by a 14 years jail sentence.

facts

[3] The accused has over a period between 1999 and 2003 defrauded the creditors to five bankruptcies the following amounts:

  • 3.1 On count 1, the creditors of meco limited, an amount of 263 000 $;
  • 3.2 On count 2, the creditors of eric lacroix, an amount of 18 100 $;
  • 3.3 On count 3, the creditors of roy sinclair, an amount of 77 000 $;
  • 3.4 On count 4, the creditors of 9084-8144 quebec inc (for which the court ignores the trade name used by this corporation if there was any) of 20 000 $;
  • 3.5 On count 5, the creditors of mini-remorque hch inc, an amount of 43 000 $;
  • 3.6 The Court expresses the concern that the creditors of these bankruptcies be advised of the result of these criminal pursuits as these frauds date back to the period of 1999 to 2003. The court was not advised of the identities of the creditors. As usually, the victims are advised of the judgment and sentence rendered, this information should be conveyed to the victims alleged as they are not designated and as they are referred simply generally as the creditors to specific bankruptcies. The Court is not aware if the superintendent of bankruptcies or the trustee who took over has a positive duty to advise victims of the sentence being rendered. Therefore, the Crown attorney is invited to so advise the Greffe of the Court of the names and addresses of the victims in each bankruptcy.

principles and objectives of sentencing

[4] Section 718 enumerates the purposes and objectives of sentencing as well as the principles that should be weighed in pronouncing a sentence.

[5] The relevant sections of section 718 read as follows: PURPOSES AND PRINCIPLES OF SENTENCING; « section 718: (PURPOSES) The fundamental principle of sentencing is to contribute, along with crime prevention to respect for the law and the maintenance of a just, peaceful and just society by imposing just sanctions that have one or more of the following objectives:

  • to denounce unlawful conduct;
  • to deter the offender and other persons from committing offences;
  • to separate offenders from society, where necessary, to assist in rehabilitating offenders;
  • to provide reparations for harm done to victims or the community
  • and to promote a sense of responsibility in offenders and acknowledgment of the harm done to victims and to the community. »

[6] Section 718.1 FUNDAMENTAL PRINCIPLE « A sentence must be proportionate to the gravity of the offence and the degree of responsibility of the offender. »

[7] Section 718.3 OTHER SENTENCING PRINCIPLES « A court that imposes a sentence shall also take into consideration the following principles:

(a) a sentence should be increased or reduced to account for any relevant aggravating or mitigating circumstances relating to the offence or the offender, and, without limiting the generality of the foregoing: iii) evidence that the offender is committing the offence, abused a position of trust of authority in relation to the victim: (b) a sentence should be similar to sentences imposed on similar offenders for similar offences committed in similar circumstances, (d) an offender should not be deprived of liberty if less restrictive sanctions may be appropriate in the circumstances (2) all available sanctions other than imprisonment that are reasonable to the circumstances should be considered for all offenders ».

[8] The Appeal Court of Québec in its decision of Roger Lévesque v. QueenFootnote 1 offers a guideline of the factors of analysis to help determine an adequate sentence on fraud infractions. Are relevant to take into consideration namely the nature and extent of the fraud and namely the amount of the fraud and the real loss suffered by the victim, the degree of premeditation including namely the planning and the fraudulent scheme used, the behaviour of the offender after the commission of the infraction including restitution and compensation of the victim, the accused's acknowledgement of his guilt, his collaboration to the investigation; prior convictions, their gravity and proximity in time; the personal advantages to the accused; the abuse on trust or authority by the accused displayed against the victim(s), the motivation of the accused such as cupidity, physical or psychological disorder, financial distress finally the fact that sums defrauded came from public funds.

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AGGRAVATING CIRCUMSTANCES AND SUBJECTIVE FACTORS

NATURE AND EXTENT OF THE FRAUDS

[9] The accused acting as a trustee in bankruptcy has breached the public and professional duties he had as he betrayed the trust placed in him by the public and society in general, by the professional bodies governing his behaviour as both a trustee in bankruptcy and chartered accountant. Furthermore, the accused has defrauded those creditors ranking to benefit from the net proceeds of the assets to be distributed. Creditors have high expectations regarding the honesty of professionals and public officers so entrusted

[10] The fraud was committed against an unknown numbers of creditors expected to be persons, corporations and government agencies. In doing so, there is no doubt that the accused has also defrauded the public in general concerned when the Ministers of Revenue are the victims as it is the public in general that pays the price for such infractions. The Ministers of Revenue were the sole creditors mentioned more specifically in the fifth count. The amounts defrauded were certainly in a large part to be returned to the creditors.

[11] The losses suffered by the creditors total an amount of 421 000 $ and were the result of the accused illegal frauds over a period of approximately 4 years from 1999.

[12] It is not in evidence that the victims entitled to share some dividends of these bankruptcies suffered aggravated inconveniences from these frauds. It does not suffice that it be possible or likely. It is hoped that the authority or trustee who took over the files of the accused will have advised the creditors of this unfortunate situation.

DEGREE OF PREMEDITATION REVEALED IN THE PLANNING AND WORKINGS OT THAT FRAUDULENT SCHEME

[13] The accused alleges that confronted with short entries in income as his clientele changed over the years and as he had to increase considerably his business expenses to liquidate the bankruptcies, he did not only borrow and loose sums of over 700 000 $ representing the liquidities and savings of his wife but he resorted to gambling and would have become addicted to it. He then lost considerable sums hoping in the magic of gambling to no avail.

[14] In doing so, he defrauded creditors of bankrupt persons and corporations an amount of 421 000 $. To so achieve, he forged a number of documents in order to hide his criminal behaviour. All of that endeavour went on for four years. He premeditated and planned a scheme to deceive and defraud the creditors of the bankrupt persons and corporations.

BEHAVIOR OF THE INFRACTOR AFTER THE COMMISSION OF THE INFRACTION

[15] The accused has not reimbursed the creditors and is not likely to do so as he earns a salary of 50 000 $ yearly.

[16] It is noted that although the accused pleaded guilty to the counts in the indictment for these criminal pursuits started in 2008, there was burdening evidence of the criminal behaviour of the accused.

[17] The accused has no priors, which is no surprise in view of his professional responsibilities.

[18] There is no surprise that in indulging in that criminal behaviour, he has compromised and lost his personal and professional reputation and his entitlement to act in the future as a chartered accountant and bankruptcy trustee. The accused's reputation of integrity has certainly been seriously damaged if not lost in his community. That price is a very high price. It is a net result of the accused dishonest manoeuvres.

PERSONAL BENEFITS ACCRUING TO THE ACCUSED AS A RESULT OF THE FRAUDS, MOTIVATION, FINANCIAL DISTRESS AND DESPERATE ILLEGAL MOVES

[19] If all of these frauds served to finance in the end the accused expenses, it is not alleged that the accused had a financially demanding style of life. These frauds would have served mainly for his gambling addiction. Even his wife paid a high price for that addiction.

[20] Whether the accused had magic thinking about gambling is irrelevant and no good faith can be alleged. It was poor thinking and it became an evil adventure failure bound. He was a looser to be predictably. He did not act responsible and played and risked the moneys entrusted in him. The accused showed plain dishonesty.

[21] The sums of money defrauded were the pathway to that tragedy for him, his business and family and for all those who socially, professionally, personally trusted him.

[22] The accused has expressed his remorse, his regrets as he has betrayed the trust of the population, of the professional corporations, of his family and wife. The accused is most sensitive to all that capital of consideration and esteem lost as a result of his dishonesty, in his damaging for good his years of efforts to build a reputable name and a reputation of honesty built over the years.

[23] Defence points out to the accused's wife being very sick, having attempted to suicide, being most vulnerable. There is convincing evidence that his wife as a result of her loosing all of her personal assets and house in the course of the ordeal of the accused, is suicidal, frail, and benefits from the help of the accused regarding the management of her pharmaceutical treatments.

RECOMMENDATIOINS OF SENTENCE BY THE ATTORNEYS

[24] The prosecutor recommends a sentence of two years of jail whereas the attorney for the accused proposes that a conditional sentence of two years minus a day would be a reasonable one.Footnote 2

CASE LAW:

[25] In the Levesque caseFootnote 3 , the accused had falsely represented his desperate financial situation in order to attract the major investment of a person nonetheless interested with however a prior in fraud and forgery years before. The accused was sentenced to 2 years of jail. That was before the conditional sentence became available as a tool of sentencing.

[26] In CoffinFootnote 4, the Appeal court of Quebec as the accused had committed 14 counts of fraud of a value of over 1 500 000 $ and restitution had been made of an amount of
1 000 000 $, a firm jail sentence of 18 months was imposed upon the offender as the fraud was considerable against the government by a person who was in a privileged position and the conditional sentence was set aside. In that judgment, the Appeal Court said that even if the accused had no priors, had a good reputation in his milieu, had reimbursed part of the sums defrauded, showed remorse or as the risk of the accused reoffending was unlikely, the objectives of deterrence and denunciation called nonetheless for a firm jail sentence.Footnote 5

[27] Referring to R. v. BogartFootnote 6, in that fraud of one million dollars where for a doctor having defrauded the government, there were numerous apparent mitigating factors such as his health condition, his serving an HIV clientele, his pleading eventually guilty, having remorse, having no criminal record and having repaid in part the amount defrauded, a jail sentence was warranted on the basis of five considerations, such as « the seriousness of the offence, the respondent's moral blameworthiness, the need for general deterrence, sentences in previous cases of large-scale fraud and the ineffectiveness of a conditional sentence »Footnote 7 in that case. The amount defrauded, the time lapse during which there was a fraud, the fact that fraud on government is not a victimless crimeFootnote 8 were factors considered.

[28] On conditional sentences, the reasoning of Justice Rosenberg of the Appeal Court of Ontario retained in R. v. WismayerFootnote 9and reaffirmed in the case of CoffinFootnote 10, stated that « general deterrence as the principal objective animating the refusal to impose a conditional sentence should be reserved for those offences that are likely to be affected by a general deterrent effect. Large scale well planned fraud by persons in positions of trust such as the accused in R. v. Pierce, would seem to be one of those offences. »Footnote 11

[29] Reference is made also to the Dobis caseFootnote 12 in the Coffin caseFootnote 13 to the judgment rendered by Justice MacPherson as the judgment is summarised as follows: « His review shows that ordinarily these frauds merit a penitentiary sentence in the range of three to five years. Even where mitigating considerations have reduced the sentence to the reformatory range, a jail term, not a sentence served in the community has usually been imposed. »Footnote 14

[30] When large fraud infractions are committed when in a position of trust, sentences generally have been rendered with firm jail sentences,Footnote 15 save exceptionsFootnote 16.

[31] Respective sentences of six months and one year were confirmed in appeal for a lawyer who had defrauded victims but not for his personal benefit and for an employee who had defrauded a corporation of the sums to be paid to government on salary deductions.Footnote 17

[32] Firm jail sentences to people who have breached the confidence of victims have been rendered in many instances. In DobisFootnote 18, there was a fraud of 286 636.50 $ as a manager defrauded his employer; he was sentenced to 33 months and ½ jail term. In BernstonFootnote 19,an elected provincial representative was sentenced to a firm jail term of one year for a fraud of 40 000  $. In Dickhoff Footnote 20, the director of a trust who defrauded his employer over a period of 4 years was sentenced to two years in jail. There had been no personal advantage to that director. Also, a number of decisions in cases of fraud involving abuse of confidence or frauds against government show that conditional sentences can be rendered in the perspective of subjective considerations.Footnote 21 In the Alain case, notwithstanding the number of victims and the amount of fraud of 1 500 000 $, personal benefit was not the sole objective, neither cupidity and 10 years had elapsed thus justifying a 2 years minus a day conditional sentence.

[33] Collective deterrence and denunciation are to be assessed objectively taking into consideration the nature and gravity of the infractions, the circumstances of their commission, the amounts defrauded, the characteristics of the victim, its social impact, the publicity that can be expected regarding such a major crime by a trustee in bankruptcy.

[34] As Chief judge Lamer stated in Proulx,Footnote 22denunciation expresses the condemnation of the accused delinquent behaviour in cases where there is a « high degree of planning and premeditation and where the infraction and its consequences are highly publicised. »Footnote 23

[35] There is a true difference between serving a sentence behind bars and benefiting from a conditional sentence.Footnote 24 That true difference is in the level of denunciation and collective deterrence that would not be satisfied ultimately although there may not be a real concern as to an offender reoffending.

[36] But, the conditions of a conditional sentence can be both quite restraining at lower costs for society with potential social advantages in terms of reinsertion and rehabilitation and development of that awareness much needed for persons who fail to behave according to the criminal code. Indeed, a sentence at home not only limits considerably the freedom of a convicted person but it exposes an accused to a much longer and stiffer detention in jail as the remainder of a jail sentence cannot be shortened if its conditional aspects are being revoked. The length of a conditional sentence is often increased and this reasonably and legitimately by a judge sentencing and any new offence exposes an accused to a stiffer sentence.

[37] A conditional sentence is an occasion to serve purposes meeting the objectives of restorative justice and social reinsertion through namely measures of therapy and treatment, keeping a worker at work and in family milieu, community work, professional help such as the one from a surveillance officer.

[38] But corrective objectives should yield the pathway to a firm jail sentence if the objectives of reprobation and denunciation and deterrence should prevail and need be that they be affirmed. But the virtues of incarceration are uncertain and that commands a careful assessment where not too much weight should be given to incarceration as the solution. Footnote 25

[39] Supreme Court justices have affirmed that objectives of collective deterrence may be achieved by imposing community work to be performed during a conditional jail sentence.Footnote 26

[40] The more the infraction is serious and the more there is a need to affirm the objective of deterrence, the more the length of the conditional sentence shall be long, the more the conditions shall be tough. But, the necessity to even more strikingly denounce a criminal behaviour can make of a sentence of incarceration the sole sentence that will state the reprobation of society regarding the conduct of an accused.Footnote 27

[41] However, in DobisFootnote 28, the question of granting a conditional sentence was understood as also depending on the real deterrent effect of a sentence. That deterrence has to do with not only the accused being sentenced but also with the community. « General deterrence is central to the sentencing process in cases involving large scale frauds with serious consequences for the victims. Conditional sentences have been rejected in large scale fraud cases such as in the cases of Pierce, Ruhland. That was commented on adversely in the leading Ontario case dealing with conditional sentences R. v. Wismayer, (1997) 115 CCC (3d) 18 (CA). »Footnote 29

[42] Several cases have indeed in cases of fraud with breach of trust reminded that conditional sentences could be imposed. For example in the Jeannotte rulingFootnote 30, a lawyer defrauded clients from her client's trust account in the amount of 200 000  $ in order to pay drug debts of her spouse and in appeal was sentenced to two years conditional sentence. The risk of reoffending was light, the offender had serious health problems and was remorseful.

[43] In the Verville caseFootnote 31, the accused had defrauded to his own personal benefit a sum of 186 488.88 $. A criminal record of jail was considered of a nature to be a nuisance for the pursuit of his dealings with banks to finance new enterprises. It was said while he was granted a conditional sentence of jail that conditional sentences were inappropriate when the dishonesty was marked by a breach of confidence. That fraud was not at all sophisticated and his experience and abilities warranted a measure of conditional sentence.

[44] In the Bunn caseFootnote 32, the Supreme Court of Canada decided that a conditional sentence of 2 years for a fraud of 86 000 $ as heirs were defrauded, as the lawyer was disbarred, as his wife was invalid was appropriate. They agreed with the Appeal Court that a conditional sentence taking into account the ruin and humiliation suffered by the accused and his family and the loss of his professional status was satisfying the objectives of denunciation and deterrence. The three dissidents were of the opinion that the severity of the sentence was by too far diminished when in this case lawyers defraud and breach the confidence entrusted in them.

[45] In the Bunn case, the offender was a lawyer who defrauded heirs in 6 estates of a sum he had in trust of 86 000 $. Chief Judge Lamer stated that « Turning to a consideration of the principles of sentencing, the court reasonably concluded that the ruin and humiliation that Mr. Bunn had brought down upon himself and his family, together with the loss of his professional status, could provide sufficient denunciation and deterrence when coupled with a conditional sentence of two years less a day with house arrest. The Court of Appeal also imposed a condition of 200 hours of community service, which was capable of achieving the restorative objective of reparation to the community. Moreover, the Court noted important mitigating circumstances in this case. The respondent was the sole provider and caregiver for both his wife, who suffered from multiple sclerosis and had been confined to a wheelchair for years, and their teenage daughter. »Footnote 33

[46] In the Toman caseFootnote 34, there was a major fraud of over 2, 500 000 $ against two banks by falsely representing the accounts receivable of his business. At the same time, the accused did not benefit of any personal benefit and was unable to reimburse. He was sentenced to a two years minus a day conditional sentence.

[47] Harmony between sentences remains an objective. Section 719.2 Criminal Code so states.

[48] It has to be assessed what kind of sentences the Quebec Appeal Court and the Appeal Courts in Canada have imposed generally for important frauds well planned and performed by offenders in a position of trust. This is an exercise of case distinguishing decisions.

[49] In the Cantin case, the Appeal Court of Québec imposed a conditional stay of proceedings for someone who had abused the confidence of a mandatory in receiving illegally a secret commission of 300 000 $ for which there was a mistaken belief that as an agent, he could astutely earn discretely sums to the detriment of the persons giving the mandate. At the same time a number of buyers would not have paid an artificially increased price of sale for buying properties. That person was barred from being an insurance broker. There will be no restitution. He has lost his right of practise, he has gone through family and spousal hardship, had lost the esteem people had for him. The Appeal Court of Quebec said after stating although deterrence was an objective that had to be given an important peculiar weight in the circumstances, « that the incarceration of the accused should not console the victims of his frauds, that a mishap cannot be replaced by another one, »Footnote 35 (translation by the undersigned), and that « It is evident that Cantin is a lot more useful to his wife and to his children and to society in continuing to work outside jail than by being incarcerated. »Footnote 36

[50] Conditional sentences are also those sentences that can be rendered in fraud cases, even in large frauds even where there is an abuse of trust by a publicly entrusted person. Many sentences affirm that conditional sentences are likely to serve the objectives of sentencing in cases that do have some similarities with the present one. Footnote 37

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ANALYSIS

INDIVIDUALISED PROCESS

[51] Sentencing is a tailored made process, an individualised process. The objectives and principles of sentencing require an assessment of those principles and objectives as applied to the case of the person being sentenced.

PREMEDITATION, PLANNING AND EXTENT OF THE FRAUDS and CIRCUMSTANCIAL LOSS OF SOVENCY

[52] It is alleged and not contradicted that as his practise of trustee became financially burdening and as he needed a considerable number of additional employees and office space and the consequent increased expenses. The accused failed to take legitimate managing measures. Gambling came to make it impossible. Then the accused found himself in a situation where he both used close to ¾ of a million dollars belonging to his wife to save his office and became a compulsive gambler loosing considerable sums of money.

[53] As a consequence of his shortage in money entries and the alleged very expensive gambling habit of the accused, the accused did defraud the creditor's account over a period of approximately four years using schemes of forgeries. Finally the accused refers to his becoming a compulsive gambler and gambling the sums of money taken in the files of the clients. Indeed, his wife is even a casualty of his addiction and business financial shortages as she has lost considerable assets of more than 700 000 $ in the ordeal and as she further came to loose even her home. This is a very high prize. Furthermore, there is clear evidence that she has become so burdened that she is vulnerable and suicidal. Invoking that, the accused who has gained employment, asks to be awarded a conditional sentence so as to help his wife medically.

[54] The accused manifestly premeditated and planned the frauds. He alleges he had a magic hope that he would be able with his gains to reimburse totally the sums stolen in the files. There is no doubt that there were a number of considerable illegal acts to cover up the frauds committed by the accused. Many false documents were created and used or forged in order to buy peace, accredit a perception of legitimacy. On that, he could manage for a number of years to induce false impressions that everything was legal.

[55] It shall take into account the fact that to defraud, the accused had to premeditate and plan and indeed forge a number of documents. The commission of these frauds over many years with evidently a number of forgeries so as to hide their commission, as well as the amounts defrauded distinguishes this case from the case of Bunn where a conditional sentence. So does also the fact that the wife of the accused is also an indirect casualty of the accused's behaviour. It is not alleged however that the amount she lost were lost directly as a consequence of the accused's gambling activities. That is a heavy personal price the wife of the accused and for the couple and family as well. Needless to say, many years have gone by since 2003 as the accused office went out of business.

[56] It can be noted that the accused certainly took advantage of his « his unsullied reputation to gain the position from which he would commit the crime. » Footnote 38

OFFENDER A TRUSTEE IN BANKRUPTCY

[57] Also, it is quite a factor that a professional chartered accountant is entrusted with the public responsibilities of trustee in bankruptcy. Such a trustee accomplishes a straightforward public duty that symbolises the much needed integrity and stability of public institutions.

LACK OF PRIOR RECORD OF NO RELEVANCY

[58] That means that the accused abused his good reputation in the community and that inference of absence of prior record damaging his reputation to commit the crimes. Indeed, as Justice L'Heureux-Dubé stated in Marchessault « Justice must be the same for everyone, great or small, rich or poor »Footnote 39 and this is so irrespective of the rank or position the persons accused occupy in society. However, amongst first offenders, people holding public responsibilities that call upon for an unquestionable integrity and institutional confidence, are to be sentenced certainly with harsher sentences that those defrauders that are not entrusted with the same public confidence vested in trustees. That distinguishes those many cases where there was abuse of the confidence of most other persons having the confidence of their employers or clients.

VICTIMS

[59] It can only be assumed that the victims whether the governments, the corporations or persons will suffer in the end losses. As the Court obtained no details as to the characteristics of people being defrauded and as it was alleged that these victims were taken care of by civil pursuits, need is in the court's opinion that the sentence that is rendered be communicated to the creditors defrauded, as is generally the practise. Here, the creditors are listed as the creditors to specific bankruptcies without any more details save exception being given to the court as to their vulnerabilities for example.

[60] Part of the sums that were defrauded was for example in the fifth count entrusted to serve for the reimbursement of the two creditors that were the federal and provincial Ministers of revenue. That is also an aggravating factor as theses sums were detained for the purpose of reimbursing the public through their governments.

NO ALLEGATION OF THE ACCUSED BENEFITING PESONALLY FROM THE FRAUDS SAVE FOR HIS GAMBLING ADDICTIOIN

[61] It is invoked and it is not contradicted that the accused did not benefit of these sums in his way of living. The accused obtained his wife's support as she sacrificed or was ripped off of close to ¾ of a million dollars of her personal patrimony inherited, Furthermore, as she was suspected of having tried to hide some assets in which the accused had an interest, her legitimate and sole ownership of the house was questioned in Court and that sufficed to rip her off of the value of the balance of her assets. His wife is also a marginal looser. The accused endeavour went on until he had used both the patrimony of his wife and the property of clients in which he had no right to any of those benefits.

[62] Defrauding governments who are acknowledged to be amongst the creditors, is defrauding the citizens whose money is directed to be used for the benefit of all.

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MITIGATING FACTORS

[63] The accused has pleaded guilty. It is however a fact that the evidence appeared to be overwhelming as to the guilt of the accused. He had to be heard on those circumstances. At the same time, his plea of guilt has dispensed with lengthier proceedings. That plea of guilt is further accompanied with the immense regrets and true contrition of the accused for the impact of his criminal behaviour on his professional corporations, on the persons defrauded, on his community as he points out to his humiliation and the one of his family in his community, as he has gone through intense torments, embarrassment and certainly societal debasement.

[64] The accused counts on factors such as his gambling addiction, his successful therapy and his alleged wife's need of his presence to prevent her from attempting to put an end to her life, his regrets and remorse to justify a two years minus a day conditional sentence.

[65] It is to be noted that the accused has deep and sincere regrets for his behaviour as he eloquently has these words that suggest some deep dramatic input and heartfelt acknowledgement of the consequences at least for himself and his wife and children and his regrets for himself and for society as a whole and the professional and statuary boards of having submitted these to his outrageous behaviour. He bears with difficulty his demeanour, his going from a success story to a public failure as he has been confronted to a social reject and to the immense impacts his wrongdoing and lack of ethics. Difficult to loose that prestige and acknowledgement and also this ability he had in his best days to provide his beloved persons with stability and social recognizance. He is manifestly shameful and will likely have to resort to an average salary.

[66] The court understands from the medical documents and hospital record deposited and the consequences on the wife of the accused that she has gone through a major and lasting breakdown and mental illness as she has suffered and is suffering from the major consequences of a downturn in fate, in destiny.

ABUSE OF TRUST

[67] Also at stake, by way of consequence, the confidence of people in those persons vested with the confidence of the public, of their professional order, of the public institutions, of the integrity of people governed by a public duty.

[68] At stake a risk that people loose confidence in their public institutions funding democracy and some stability and confidence in the management of bankruptcies by trustees. There is little question about the risk of the accused re-offending as he might not be given an opportunity to do so, as he has learned through the whole ordeal and the judicial proceedings that there is already a high personal and social prize to pay.

RESTORATIVE JUSTICE

[69] The victims are not to benefit of any financial reimbursement by the accused.

[70] Restorative justice was referred to in the Carole Jacques Appeal Court decision stating that if the objectives of denouncement would appear to be better served by incarceration, conditional sentences served generally better the objectives of social reinsertion of delinquents, restorative justice and raising the awareness of delinquentsFootnote 40.

[71] Restorative justice was referred to in paragraph 18 of Proulx as it reminded that
« Restorative justice is concerned with the restoration of the parties that are affected by the commission of an offence. Crime generally affects at least three parties: the victim, the community, and the offender. A restorative justice approach seeks to remedy the adverse effects of crime in a manner that addresses the needs of all parties involved. This is accomplished, in part, through the rehabilitation of the offender, reparations to the victim and to the community, and the promotion of a sense of responsibility in the offender and acknowledgment of the harm done to victims and to the community… »Footnote 41 It is true that in this case, serving a sentence in the community would not endanger or prejudice de security of society. « According to the Supreme Court of Canada, there is no infraction that in view of the nature of the infraction should be excluded in principle if there is no minimum jail term or firm jail sentence to be pronounced.Footnote 42 However, that will be so only if a delinquent is sentenced to a provincial term jail sentence.

DETERRENCE THROUGH PASSAGE IN COURT AND LOST OF CAREER

[72] The Court is aware that 3 years passage in court is quite a personal deterrent for the accused and that he has lost trough his professional radiations that aura that conferred his professional titles and the moral authority he was thus justifying. He did so through his own dishonesty as he gained an addiction to gambling to attempt through the magic of gambling to remedy some financial difficulties he had encountered that needed him to change the course of the management of his office.

INCARCERATION

[73] At first sight, even a three to four years jail sentence, a bit less or more, would have been a reasonable sentence. However, the two years sentence proposed by the Crown can hardly be set aside as totally unreasonable. It is clement, very indulgent but the Court does not feel that there is place to justify the setting aside of the two years recommendation or opinion the Prosecutor. It is a light recommendation but although that figure of 2 years is very low, it cannot be disregarded or even set aside as truly unreasonable.

[74] The Crown attorney was called upon by the defence attorney when about to dispose of the sentence in this file, to acknowledge he was agreeing to a two years minus a day sentence. The Crown attorney stated he would not object for a two years minus a day firm jail sentence.

[75] Nonetheless, it is a penitentiary term of incarceration that should be pronounced on these counts of frauds. Protection of the pubic here calls for a clear judicial; statement that it would be a disproportionate measure of leniency in the very circumstances if a conditional sentence was pronounced. Apart from the fact that accessorily, the two years sentence appears to be minimally suitable in the presents and could not be increased as it is often being done in cases where conditional sentences are being rendered, it is the opinion of the court, that the objectives of collective deterrence and denunciation would not be met by a two years minus a day firm or conditional sentence, even taking into account the peculiarities of the specific case, If a conditional sentence was pronounced. It would be short of meeting the purposes of the law.

[76] That one day apparent difference in sentence, if it was reduced to an incarceration in a provincial jail or to a conditional sentence, would not compensate the public need to voice the values of protection of our society from this course of behaviour. A firm penitentiary jail sentence meets the much needed objective of sentence called for.

[77] Stressing denunciation and collective deterrence and punishment through the b symbol of a firm incarceration rather than through a conditional sentence with stiff conditions and even a probation with community work would not in the present case make it clear that this criminal behaviour is totally unacceptable. This is not a case where these objectives can be met by a conditional sentence with stiff conditions?Footnote 43

HARMONY

[78] Harmony has to do not solely with a comparison of figures. It is coming to a point where once the analysis of other sentences is achieved, the sentence to be rendered is justified taking into account the circumstances of the case. It is the opinion of the court that even compared with the sentence in the Bunn case referred to, this penitentiary tem is justified because of the nature of the public office of the accused, the extent and nature of the frauds, the forgeries made to hide the accused multiple breaches in the creditors files notwithstanding the accused and family ruin and humiliation, the accused sincere regrets, his alleged successful gambling therapy and the most serious mental frailties of his wife following the accused" s gambling desperate ordeal and the fact he was gainfully employed as an acquaintance had employed him at a salary of 50 000 $ yearly.

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LEAST RESTRICTIVE SENTENCE

[79] The court should consider if there are less restrictive sanctions applicable (section 718 (2) d)) if the circumstances do so justify. It is clear that a suspended sentence with probation measures would not at all be convenient to meet the objectives that need be affirmed in the present case. It would not be collectively deterrent and denunciatory enough neither would it fit the objective of retribution.

[80] A probation coupled with a conditional sentence may serve social reinsertion and foster rehabilitation, but it would not reflect in the court's opinion the much needed deterrence and denunciation purposes of the sentence that should be rendered.

PROPORTIONALITY OF THE SENTENCE TO BE RENDERED

[81] Section 718.1 of the Criminal Code sets that the sentence should be proportional to the gravity of the infraction taking into consideration its nature, the circumstances of its commission and the person pursued.

PROTECTION OF THE PUBLIC

[82] Reprobation is most certainly called for where the trust of people in its entrusted professionals and institutions is much needed so as to maintain the confidence of the citizens of this country in the persons that are to accomplish a public task of managing the assets of bankrupt people and corporations until the distribution of the remaining assets and dividends is being achieved.

[83] The Court is concerned with the protection of the public that is served by a sentence that privileges denunciation and collective deterrence and the inherent counterpart of that protection that is the perception of the public. Footnote 44

FIRM SENTENCE OF JAIL

[84] Other decisions regarding persons abusing the trust also point out to jail being a proper deterrent. Footnote 45

OBJECTIVES IN SENTENCING

[85] The principles of sentencing call for an appropriate sentence curtailed to the gravity of the infraction and the situation of the accused as a personal ready to wear.

[86] Deterrence and denunciation and a measure of exemplarity will have to be met and be represented in the sentence to be rendered.

[87] It is clear that the years since 2003 have been a long endless storm that now culminates in the judicial proceedings as the accused has lost his most business, his right to act professionally as both a trustee in bankruptcy and chartered accountant, his reputation. He does not appear to have personally benefited from the frauds committed as they were seemingly used to compulsively gamble and as his wife's assets were swallowed up by his gambling and office shortage in professional income.

[88] The question of personal deterrence, of rehabilitation notwithstanding a pre-sentence report that appears to make a finding of vulnerability to greed, of the accused having values that are weak and his being rather egocentric, also acknowledge that he understands the gravity of his criminal behaviour and regrets it. The relevance of his ongoing reflection on his liability is seen as key for the future. But although there may be doubts as to the risk that the accused reoffends, the court considers that such risk is very unlikely.

[89] What is the proper sentence? The Crown that made a plea filled up with dignity and concern that the purposes of justice be met, recommends a sentence of 2 years of jail and believes that the objectives of social deterrence, reprobation and denunciation should prevail.

[90] Defence pleads that a conditional sentence of two years minus a day could be so structured so as to meet the objectives of justice and that furthermore, the accused is not only the sole provider of his wife but that also he is now the caretaker if not orderly of his wife as he controls the medication she has to take from time to time so as to avoid any attempt to suicide.

[91] Nothing but a firm sentence of jail at first sight appears likely to meet the peculiarities of this file, the purposes and objectives of sentencing.

[92] The court's first appraisal of what in the circumstances would be a fair sentence would be in a bracket of 30 months to 5 years before the courts takes in consideration all of the factors relevant.

[93] A sentence of two years of jail appears adequate in the circumstances.

THEREFORE THE COURT SENTENCES THE ACCUSED TO A TWO YEARS JAIL SENTENCE.

THE WHOLE WITHOUT FINE SURCHARGE IN VIEW OF THE JAIL TERM PRONOUNCED AND OF THE INABILITY OF THE ACCUSED TO PAY THAT SUM.

Justice Louis A. Legault, J.C.Q.

Me Pierre Lévesque
Crown attorney

Me André Barbacki
Defence attorney

Date of hearing: and

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Footnotes

  1. 1 Lévesque vs A.-G. of Québec, , Justices Bisson, Lebel and Otis, 500-10-000204-920, pages 3, 4 and 5. (back to footnote reference 1)
  2. 2 Section 742.1 of the Criminal code reads as follows: « Where a person is convinced of an offence, except an offence that is punishable by a minimum term of imprisonment and the court (a) imposes a sentence of imprisonment of less than two years, and (b) is satisfied that serving the sentence in the community would not endanger the safety of the community and would be consistent with the fundamental purpose and principles of sentencing set out in sections 718 to 718.2, the court may, for the purposes of supervising the offender's behaviour in the community order that the offender serve the sentence in the community subject to the offender's complying with the conditions of a conditional sentence order made under section 742.3 ». (back to footnote reference 2)
  3. 3 Lévesque v. A.-G. of Québec, November 2nd 1993. (back to footnote reference 3)
  4. 4 Queen v. Coffin, 500-10-003277-088, , Justices Forget, Rochon and Morissette, CAQ (back to footnote reference 4)
  5. 5 Note 8, par 61. (back to footnote reference 5)
  6. 6 Bogart, (2002) 61 OR (3d) 75, leave to appeal refused, [2002] SCCA no. 398, par 21. (back to footnote reference 6)
  7. 7 Bogart, par 21. (back to footnote reference 7)
  8. 8 Bogart, par 22, 23. (back to footnote reference 8)
  9. 9 R. vs Wismayer (1997) 116 CCC (3d) 18. (back to footnote reference 9)
  10. 10 Coffin referred to in note 4, par 33. (back to footnote reference 10)
  11. 11 Wismayer, note 9, page 38. (back to footnote reference 11)
  12. 12 R. v. Dobis, (2002) 163 CCC (3d) 259 58 OR (3). (back to footnote reference 12)
  13. 13 Coffin, note 4, par 65. (back to footnote reference 13)
  14. 14 Coffin, par 65 in reference to Bogart note 8, par 36. (back to footnote reference 14)
  15. 15 R. c Corriveau, (2003) JE2003-1486; R. v. Bouchard, [2003] JQ no 7242; R. c. Poirier, (2001) JE 2001-2184, [2002] CSC NO 36; R. c. Laroche, [2001] JQ no 370; R. c. Salomon, (2001) JE 2001-912; R. v. Hartz, (2002) 312 AR 399; R. v. Stevenson (2002) 299 AR 159; R. v. Millward, (2000) 271 AR 372; Kerntopf, (2000) 232 AR 154; R. v. Lam, (2005) 211 BCAC 186; R. v. Seabrook, (2003) 186 BCAC 317; R. v. Khan, (2002) 181 BCAC 3; R. v. Schneider, (2002) 166 BCAC 206; R. v. Stokic, (1999) 127 BCAC 256. (back to footnote reference 15)
  16. 16 Note 27. (back to footnote reference 16)
  17. 17 R. c. Desnoyers, 500-10-00359-022, 2002-07-19, Justices Robert, Forget and Rochon; R. c. Langlois, 500-10-002610-036, 2006-03-14, Justices Nuss, Morin, Côté. (back to footnote reference 17)
  18. 18 Dobis, (2002) 58 O.R. (3d) 536. (back to footnote reference 18)
  19. 19 Bernston, (2000) 145 CCC (3d) 494. (back to footnote reference 19)
  20. 20 Dickhoff, (1988) 130 CCC (3rd) 494. (back to footnote reference 20)
  21. 21 R. c. Alain, [2001] JQ 3727. (back to footnote reference 21)
  22. 22 Proulx, 2000 RCS 5, paragraph 81. (back to footnote reference 22)
  23. 23 Queen v. Latimer, [2001] 1 SCR 3. (back to footnote reference 23)
  24. 24 Cunningham v. Canada, [1993] 2 SCR 143, page 150. (back to footnote reference 24)
  25. 25 Proulx, note 23, par 107. (back to footnote reference 25)
  26. 26 Proulx, note 23, par 107. (back to footnote reference 26)
  27. 27 Proulx, note 23, par 106. (back to footnote reference 27)
  28. 28 Queen vs Dobis, (2002) 58 O.R. (3d) 536, par 49; Proulx, note 23, par 126-127. (back to footnote reference 28)
  29. 29 R. v. Wismayer, (1997) 115 CCC (3d) 18 (CA) ref. 11, par [51]. (back to footnote reference 29)
  30. 30 Jeannotte, 2005 RJQ 2425. (back to footnote reference 30)
  31. 31 Verville, (1999) JE 99-1670. (back to footnote reference 31)
  32. 32 Bunn, [2000] 1 RCS 183. (back to footnote reference 32)
  33. 33 Note 23, par 23. (back to footnote reference 33)
  34. 34 Toman, 2005 JE 2006 65. (back to footnote reference 34)
  35. 35 R. c. CANTIN, 500-10-000865-993, judgment Justices Beauregard, Mailhot, Pidgeon 2001.01.09, par 23. (back to footnote reference 35)
  36. 36 Ref 13, paragraph 27. (back to footnote reference 36)
  37. 37 Queen v. Bunn referred to number 23; R. c. Dussault, Grundman, Sardano and Vitorino, , file number 500-01-007412-023, Judge Jean-Pierre Bonin (abus de confiance, conseillers municipaux, sursis); Queen v. Adams, Ontario Court of Justice, 2009 ONCJ 383, Justice Melvyn Green, ; R. c. Jeannotte, 500-01-001417-010, Juge Louise Provost, (fraude avocate, détournement de 200 000 $ en fidéicommis pour payer dettes de drogue du conjoint, remboursement fonds du Barreau, sursis 2 ans moins un jour); R. c. Claude Harvey, Judge Raymond Séguin, 550-01-014411-047, ; R. c. Gobeil, 150-01-005748-026, Juge Conrad Chapdeleine, ; R. c. Robert Ferron, 700-01-025789-994, (fraude employeur 356 133 $, remords, restitution, fraude pour bien-être de famille et luxe, sursis 2 ans); R. c. Yvon Geoffroy, 450-01-053024-084, Judge Paul Dunnigan; R. v. Sylvain Cormier, 500-01-004866-031, Judge Gilles Garneau, ; R. c. Philippe Clément, 500-01-007647-024, Judge Jean B. Falardeau, , (fraude par avocat 3 000 000  $, projet non complété, radiation avocat, victime de sévices sévères par investisseur, sursis 2 ans); R. c. Wordsworth, 500-01-013866-063, , Judge Louise Villemure; Queen v. Harding, 2006 SKPC 56, , Judge J Benison, Saskatchewan Provincial Court. (back to footnote reference 37)
  38. 38 R. v. Foran, (1970) 1 CCC 376 Ontario Court of Appeal. (back to footnote reference 38)
  39. 39 Marchessault c. R., 500-10-000035-848, , page 3. (back to footnote reference 39)
  40. 40 Carole Jacques, 500-10-001452-984, Justices Beauregard, Deschamps, Biron, , paragraph 46. (back to footnote reference 40)
  41. 41 Proulx above quoted, par 18. (back to footnote reference 41)
  42. 42 Proulx above quoted, par 127. (back to footnote reference 42)
  43. 43 R. v. Proulx, [2000] 1 SCR 742. (back to footnote reference 43)
  44. 44 Nathaniel Salomon v. Louise Comeau, trustee of the Quebec Bar and al., 500-09-008571-994, Justices Vallerand, Forget and Philippon, 2001-02-2001, par 75. (back to footnote reference 44)
  45. 45 Khan, (2002) 181 BCAC 3 (fraud against employer and investors, 3 years sentence; Hoy (1998) 13 BCAC fraud of 370 000 $ by insurance broken defrauding his clients and saying « It is unacceptable to steal clients… in the financial community... »; Hartz (2002) 312 AR 399 « in cases of a significant abuse of trust, incarceration should be expected as the right sentence: fraud 123 860 $ »; Millward, (2000) 232 AR 154: fraud of 352 000 $ by an insurance broker, breach of trust, no mitigating factors: 20 months jail sentence; Verville, 1999 JE 99-1670 fraud 186 488.88 to his personal benefit. Conditional sentence is inappropriate when there is a breach of confidence in the dishonest behaviour of an offender; Clement, 2004 JE 2004-1570 fraud by a lawyer of 3 000 000 $. Unlikely lawyer will again practise law, was beaten as a consequence of that fraud, 2 years conditional sentence; R. v. Holmes (1999) 43 W.C.D. (2d) 238 (Alta c. A.), fraud of 100 000 $ from employer by gambler: given 18 months conditional sentence served, 9 months jail sentence; R. v. McIvor, (1996) 106 CCC (3d) 285, fraud of 8 075 $ against employer, 4 months jail sentence; Gilbert Chartrand et Carole Lambert c. R., 2007 QCCA 1422, fraud of 750 000 $ of which 650 000 $ served for personal purposes, 18 months jail sentence; R. v. Harding, 213 CCC (3d) 543, fraud of 333 000 $ against employer, 13 months jail sentence, after serving 5 months a conditional sentence; Queen v. Brenda Oates, 2008 SKQB 274, fraud against employer of 460 520.62 $, 15 months incarceration plus probation; Queen v. O'Neil, 2009 CanLll 81938 (ON. SC), fraud of 173 043.01 $ against employer, 12 months of incarceration and probation of 12 months; Queen v. Jones, 2005 ABPC 310, fraud of 26 800 $, against employer, 12 months jail sentence, probation of 12 months and order of full restitution; Q. v. Kenneth Wesley Headrick, 2005 ABPC 185, fraud of 43 045,69 $ against Little League of Baseball Association, 12 months of jail sentence and order of full restitution; R. v. Toia, 2007 CarswellOnt 296, fraud below 300 000 $ by manager against employer by an employee gambling addicted, 15 months jail sentence, 3 years probation, order full restitution; R. c. Hadjor, (2002) 165 OAC 34, fraud by accountant 400 000 $, 2 years jail sentence. (back to footnote reference 45)

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