Hiding Behind a Corporation

Unregistered persons practising a profession through a corporation generally cannot escape prosecution for unauthorized practice. That was the message of the Ontario Court of Appeal in R. v. Codina, 2020 ONCA 848 (CanLII), https://canlii.ca/t/jcbs7. Ms. Codina, a disbarred lawyer was found to have provided immigration advice for compensation without being registered with the immigration consultants’ regulatory body. She argued that all clients contracted with her corporation and all fees were paid to the corporation and thus she should not personally be convicted.

The jury heard a great deal of evidence about the operation of Codina International and its employment of various individuals, some of whom were qualified to give advice or provide representation under s. 91. The trial judge, however, appreciated that the operation of Codina International was not the focus of the trial. The appellant’s liability turned on what she did and said in respect of the events giving rise to the charges. If she gave advice, she was responsible for that conduct, regardless of how her company was structured or organized its business.

As a matter of law, if the appellant offered advice or provided representation, it was irrelevant to her liability that others operating within Codina International were also providing advice or representation. It was equally irrelevant that the appellant purported to give advice or provide representation in her capacity as a spokesperson, officer or employee of Codina International. The corporate veil offers no protection from personal criminal responsibility for one’s own conduct ….

The Court also rejected the argument that it was the corporation and not the individual who received the compensation:

The appellant submits it is unfair to hold the appellant liable for her personal acts even if done in the course of the operation of Codina International, while at the same time imposing liability based on consideration paid only to Codina International. I fail to see any unfairness. If the appellant engaged in the conduct prohibited by s. 91, and directed the payment of the consideration elsewhere, she remains equally responsible for her actions. In any event, it stretches credulity to find any unfairness here. The money went into a bank account totally controlled by the appellant. Clearly, she benefited directly from the consideration paid.

Hiding behind a corporate structure is unlikely to be an effective circumvention strategy for most unauthorized practice cases.

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