Canada-U.S. Blog Trade Lawyers Cyndee Todgham Cherniak and Susan K. Ross

Federal Court of Appeal Finds NEXUS Pass Confiscation Not Justified

Posted in Legal Developments, NEXUS

On February 8, 2018, the Federal Court of Canada released its decision in Gunwani Sodhi v. The Minister of Public Safety and Emergency Preparedness, 2018 FC 145 in which Justice Campbell found that the confiscation of Mr. Sodhi’s NEXUS membership by the Canada Border Services Agency (“CBSA”) lacked justification. This is the first Canadian judicial review decision where a NEXUS pass holder has been successful.  It is not the first success – we have successfully settled a number of judicial reviews and actions on behalf of NEXUS members and have been successful regularly at the informal Recourse Directorate review stage.

In the Sodhi case, Mr. Sodhi, a U.S. citizen, entered Canada on August 17, 2016 at the Whirlpool Bridge port of entry (near Buffalo/Niagara-by-the-Lake). At the Primary Inspection booth, Mr. Sodhi informed the CBSA officer that he was taking prescription medication for diabetes and high blood pressure to a family member in Canada.  That family member had recently visited Mr. Sodhi and forgot his medication. Mr. Sodhi was sent to the Secondary Inspection Area.  During the secondary inspection, the CBSA officer seized he prescription medication because Mr. Sodhi was not the person to whom the medication was prescribed and confiscated Mr. Sodhi’s NEXUS membership card.

It is not clear from the written reasons what the Seizing CBSA Officer wrote on any seizure paperwork.  However, the Recourse Directorate upheld the seizure under the Food and Drug Regulations.  The decision letter written by the Recourse Directorate (for the Minister) did not refer to section 7.1 of the Customs Act.  In the Memorandum of Fact and Law, the Department of Justice (“DOJ”) lawyer (the lawyer for the Minister) argued that the basis for the cancellation of Mr. Sobhi’s NEXUS membership was section 7.1 of the Customs Act, which prohibits the making of false statements to the CBSA.  The reason for the DOJ argument was that there must be a contravention of the Customs Act.  This was a critical precondition.

Justice Campbell considered Subsection 22(1) of the Presentation of Persons (2003) Regulations, which sets out the bases on which a NEXUS Membership may be cancelled.  Subsection 22(1) provides as follows:

22 (1) The Minister may suspend or cancel an authorization if the person:

(a) no longer meets the requirements for the issuance of the authorization;

(b) has contravened the [CustomsAct, the Customs Tariff, the Export and Import Permits Act or the Special Import Measures Act, or any regulations made under any of those Acts; or

(c) has provided information that was not true, accurate or complete for the purposes of obtaining an authorization.

Justice Campbell reviewed the Decision of the Minister that was issued by the Recourse Directorate and held that the DOJ lawyer could not present arguments concerning section 7.1 of the Customs Act as it was not part of the Minister’s Decision.  The case fell apart.

Justice Campbell then held that the Minister had made reviewable errors in the Decision.  The Minister’s letter indicated that there was a contravention of the Customs Act when in fact the alleged contravention was under the Food and Drug Regulations.  The Food and Drug Regulations are enforced by Health Canada and not the CBSA.  The CBSA were not authorized under the Food and Drug Regulations or the Presentation of Persons (2003) Regulations to cancel Mr. Sodhi’s NEXUS Membership.

Justice Campbell set aside the Minister’s Decision to maintain the cancellation of Mr. Sodhi’s NEXUS membership and referred the matter back to the Minister without instructions.  Justice This is a case that the Recourse Directorate should have settled.  It was clear that Mr. Sodhi was bringing prescription medication to a family member – this was not an importation of illegal drugs or drugs being misused in any way.  Mr. Sodhi exercised his legal rights and filed a judicial review.  The Federal Court saw the silliness of the CBSA position and would not allow the DOJ to correct deficiencies in the CBSA paperwork, including Recourse Directorate decision.Campbell awarded Mr. Sodhi costs of $1,500.

This was the right result. NEXUS cards are issued to trusted travelers. The CBSA enforcement manual gives the CBSA officers discretion.  That discretion should be used in a positive manner to give travelers the benefit of the doubt when the issue does not relate to illegal drugs or an attempt to evade Canadian taxes by failing to declare goods.  Far too often, a minor misunderstanding turns into a “gotcha” moment.  The CBSA should always ask themselves whether they still trust the traveler enough to continue to allow them to use the NEXUS lane.

If you run into difficulty and your NEXUS Card is cancelled, consider filing a request for decision.  Here are some articles we have written:

What Were The Top 10 Reasons for NEXUS Card Cancellations in 2017?

How Can I Get My NEXUS Card Back When It is Cancelled/ Confiscated By The CBSA?

Do Not Pass GO: Forgetting Your Receipts Gets You A Ticket To CBSA Secondary Inspection

Alcohol And Tobacco: Two Things That Cause CBSA Officers To Not Apply Common Sense

Canada Day: Survival Guide For Canada-US Cross Border Travel

Canadians Living In Border Cities at Risk for NEXUS Pass Confiscations

Canadian Resident NEXUS Travelers Should Bring Traveller Declaration Card to Report Purchases to CBSA

For more information, please contact Cyndee Todgham Cherniak at 416-307-4168 or at cyndee@lexsage.com. Alternatively, visit www.lexsage.com.