In R. v. Vallières, 2022 SCC 10, the respondent, Mr. Vallières, was a major player in a heist of maple syrup belonging to the Fédération des producteurs acéricoles du Québec in 2011. Mr. Vallières and his accomplices stole 9,571 barrels of maple syrup with a market value of over $18,000,000 by surreptitiously emptying the barrels of syrup and refilling them with water. By his own admission, Mr. Vallières earned $10,000,000 in income from the resale of the syrup and made a personal profit of nearly $1,000,000.
In 2016, Mr. Vallières was found guilty of theft, fraud and trafficking in property obtained by crime, offences that all concerned property with a value of more than $5,000. The Crown sought a fine in lieu of just under $10,000,000 payable within 8 years. The trial judge concluded that under s.462.37(3) Criminal Code, RSC 1985, c C-46, the fine had to be equal to the value of the property that was the proceeds of the crime. Therefore, the judge found that he had no discretion other than to order a fine equal to the amount demonstrated beyond a reasonable doubt that Mr. Vallières had received. The judge imposed a $10,000,000 fine (minus the amount of a restitution order). Mr. Vallières would be imprisoned for 6 years if he did not pay the fine within 10 years.
The Quebec Court of Appeal, on its own initiative, reduced the amount of the fine in lieu. The Court held that courts have the discretion to impose fines that reflect the profit made by the offender. The Court believed that the fine imposed was disproportionate and a fine based on the profit was more in keeping with the objective of deprivation of proceeds. The Court reduced the fine to the amount of Mr. Vallières’ personal profit (minus the amount of a restitution order).
Chief Justice Wagner, delivering the judgment of the Court, ruled that the Court of Appeal erred by reducing the amount of the fine. Wagner C.J. explained that a fine in lieu is in the nature of a forfeiture order and should not be calculated based on sentencing principles that are incompatible with that nature (para 24).
Wagner C.J. explained that judges have no discretion when it comes to determining the amount of the fine. Section 462.37(3) Criminal Code, RSC 1985, c C-46 is categorical with respect to the amount of the fine. The fine is equal to the proceeds of crime (para 26). Limiting the scope of the fine to the profit disregards the nature of a fine in lieu order (para 30).
A fine in lieu is not part of the global sentence and does not vary based on moral blameworthiness or the circumstances of the offence. The fine serves as a deterrent, not only to the offender, but also to potential accomplices. It also deprives the offender of the criminal proceeds (para 33). The severity of the fine sends the message that “crime does not pay” (para 34). Wagner C.J. concluded that the discretion conferred on courts in s.462.37(3) does not allow them to limit the amount of the fine to the profit. Judicial discretion applies only to the decision of whether to impose the fine and to the determination of the value of the property (para 35).
When determining the value of the property, the Crown has the burden of showing that the offender had possession or control of property that is the proceeds of crime and to establish the value of that property (para 36). This determination must be based on evidence. Where stolen property is resold, the sum obtained from the property is the proceeds of the crime. There may therefore be a discrepancy between the proceeds of the crime and the actual market value of the stolen property (para 37).
Wagner C.J. explained that courts may divide the value of the property among several co-accused to avoid a risk of double recovery. The onus is on the offender to demonstrate that it appropriate to divide the value of the property (para 39-40). Wagner C.J. reasoned that this apportionment was consistent with both the objectives of the fine in lieu and the nature of the order (para 42).
The discretion to apportion can only be exercised where the other party has been charged since the risk of double recovery does not arise when only one person is on trial (para 44). The evidence must also show that the co-accused had possession or control of the same property, or part of it, at some point in time (para 46). Apportionment may be challenging where the co-accused are tried in separate proceedings. To overcome this, the court need only find that the available evidence would have allowed apportionment had the co-accused been before them (para 49).
Wagner C.J. stated that the court must apportion the value of the proceeds where the conditions giving rise to the possibility of double recovery are met. The court has no choice. Though the accused has the onus of establishing that apportionment is appropriate, the Crown should on its own initiative apportion the value of the property between the co-accused where this is supported by the evidence. This duty exists in every case, but is particularly important where the accused are tried separately (para 50-53). Wagner C.J. added that the Crown may forgo seeking a fine in lieu (or a portion thereof), thus eliminating the risk of double recovery. In that case, the offender’s co-accused would not be able to rely on that amount to limit their own fines (para 55).
The Court of Appeal erred by reducing the fine to the offender’s profit margin. Wagner C.J. reiterated that the fine must be equal to the value of the property that is the proceeds of crime. The Court of Appeal was mistaken when it conflated the purpose of the fine in lieu with that of an ordinary sentence. The fine is not a punishment. It is intended to replace the stolen property whose forfeiture has become impracticable (para 57, 60).
The Court of Appeal also erred by finding that Mr. Vallières never had $10,000,000 in his possession, since by his own admission he had control of that amount either in his hands or in bank accounts at some point. That possession triggered the proceeds of crime analysis (para 61).
Wagner C.J. stated that in this case the risk of double recovery was non-existent and there was no mistake on the part of the trial judge for failing to apportion the fine (para 64). The Supreme Court allowed the appeal and set a fine of $10,000,000, minus the amount of a restitution order (para 68).