Duhamel v. The King

Duhamel v. The King
Court (s) Database
Tax Court of Canada Judgments
Date
2022-06-21
Neutral citation
2022 TCC 66
File numbers
2018-1782(IT)G
Judges and Taxing Officers
Dominique Lafleur
Subjects
Income Tax Act
Decision Content
Docket: 2018-1782(IT)G
BETWEEN:
JONATHAN DUHAMEL,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH TRANSLATION]
Appeal heard on November 1, 2, 3, 4, 5, 22, 23, 24, 25 and 26, 2021, at Montreal, Quebec and on December 14, 2021, at Ottawa, Canada
Presiding: The Honourable Justice Dominique Lafleur
Appearances:
Counsel for the appellant:
Yves Ouellette
Guy Régimbald
Tristan Joanette
Counsel for the respondent:
Grégoire Cadieux
Sonia Bédard
Julien Wohlhuter (November 22 and 23, 2021)
JUDGMENT
In accordance with the attached reasons, appeals from reassessments made under the Income Tax Act (the Act) for the 2010, 2011 and 2012 taxation years are allowed, with costs to the appellant, and the reassessments are referred to the Minister of National Revenue for reconsideration and reassessment on the understanding that the net earnings from Mr. Duhamel’s poker gambling activities should not be included in computing his income under sections 3 and 9 of the Act for the 2010, 2011 and 2012 taxation years.
The parties have until July 22, 2022, to reach an agreement on costs. If an agreement is not reached within this period, the parties must file their written submissions of no more than 10 pages with the Court no later than August 26, 2022.
Signed at Montreal, Quebec, this 21st day of June 2022.
“Dominique Lafleur”
Lafleur J.
Translation certified true
on this 19th day of January 2024.
François Brunet, Revisor
Citation: 2022 TCC 66
Date: 20220621
Docket: 2018-1782(IT)G
BETWEEN:
JONATHAN DUHAMEL,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH TRANSLATION]
REASONS FOR JUDGMENT
Lafleur J.
I. BACKGROUND
[1] The appellant, Jonathan Duhamel, won the No‑Limit Texas Hold’em Poker Tournament at the World Series of Poker (WSOP) Main Event held in Las Vegas in July and November 2010, pocketing millions of dollars, when he was 23 years old. Mr. Duhamel was crowned poker world champion. Over the next several years, Mr. Duhamel continued to play poker and make net gains from his poker gambling activities.
[2] Following Mr. Duhamel’s victory in the WSOP Main Event, Rational Entertainment Enterprises Limited, doing business as PokerStars (PokerStars), entered into an agreement (the PokerStars Agreement) under which it agreed to pay US$1 million to Jonathan Duhamel Consulting Inc. (JD Co.) incorporated by Mr. Duhamel in October 2010. As consideration for payment of this amount to JD Co., Mr. Duhamel agreed to act as a spokesperson for PokerStars and participate in promotional events as well as a number of online and in‑person tournaments. This sponsorship agreement was renewed annually until 2015, for smaller amounts paid by PokerStars.
[3] The Minister of National Revenue (the Minister) concluded that Mr. Duhamel was carrying on a business through his poker gambling activities and issued notices of reassessment under the Income Tax Act (R.S.C., 1985, c. 1 (5th Supp.) (the Act). Therefore, the Minister added the following amounts as business income in computing Mr. Duhamel’s income, for the 2010, 2011 and 2012 taxation years: $4,867,138, $568,017 and $849,788, respectively. According to the Minister, these amounts reflected the net gains from the poker tournaments in which Mr. Duhamel participated during the years at issue.
[4] At the beginning of the hearing, the parties filed a consent to judgment dated November 1, 2021, pursuant to which they agreed to the amount of net poker gains earned by Mr. Duhamel during the taxation years at issue, i.e., $4,866,117 for the 2010 taxation year; $383,916 for 2011 and $106,775 for 2012. The amount of net poker gains is not at issue before the Court. The parties therefore agreed that if the Court found that Mr. Duhamel’s poker gambling activities constituted a source of business income for the purposes of the Act, then, in computing his income, he must include the net gains derived from poker gambling activities as indicated in the consent to judgment.
[5] Mr. Duhamel testified at the hearing, as did his accountant and the Canada Revenue Agency auditor responsible for auditing Mr. Duhamel’s records. The respondent called journalists as well as a friend of Mr. Duhamel to testify.
[6] The parties also called experts to testify on whether No‑Limit Texas Hold’em poker is a game of chance or skill.
[7] The expert called by the appellant was Professor Matthieu Dufour, PhD (Mathematics), ASA (Associate of the Society of Actuaries) and professor of actuarial science in the Department of Mathematics at the Université du Québec à Montréal (Mr. Dufour). The Court recognized Mr. Dufour as an expert in mathematics, actuarial science and game theory.
[8] The expert called by the respondent was Randal D. Heeb, PhD (Economics), a consulting economist and partner at Bates White LLC, an economic consulting firm. The Court recognized Mr. Heeb as an expert in economics and game theory.
[9] In these reasons, when the Court refers to poker, it is referring to No‑Limit Texas Hold’em poker. Also, any statutory provision referred to in these reasons is a provision of the Act.
II. ISSUE
[10] The sole issue before the Court is whether the net gains from Mr. Duhamel’s poker gambling activities should be included as business income in computing his income under sections 3 and 9, for the 2010, 2011 and 2012 taxation years.
[11] As noted above, the amount of net gains from Mr. Duhamel’s poker gambling activities is not at issue before the Court. Also, JD Co.’s earnings, including amounts paid by PokerStars under the PokerStars Agreement, as well as amounts paid by JD Co. to Mr. Duhamel as dividends or otherwise, are not in dispute before the Court.
III. POSITIONS OF THE PARTIES
3.1 Appellant
[12] According to the appellant, since poker is a game of chance, gains from poker gambling activities are not taxable under the Act because a business was not being carried on, even if it had been demonstrated that Mr. Duhamel had a serious business plan and was using strategies to minimize his risks. The Court does not have to determine whether chance prevails over skill in poker. It simply needs to establish that there is an element of chance in poker.
[13] In addition, while the Court finds that poker gambling activities may constitute the carrying on of a business despite the element of chance inherent in this game, playing poker was a hobby and a leisure activity for Mr. Duhamel. Thus, Mr. Duhamel’s gains from this game should not be taxed as income from carrying on a business.
[14] In such a case, given the factors propounded by the Supreme Court of Canada in Stewart v. Canada, 2002 SCC 46 (Stewart), as well as the principles flowing from Cohen v. The Queen, 2011 TCC 262 (Cohen), Luprypa v. The Queen, [1997] 3 CTC 2363, [1997] TCJ No. 469 (TCC) (Luprypa), Leblanc v. The Queen, 2006 TCC 680 (Leblanc) and Radonjic v. Canada (Revenue Agency), 2013 FC 916 (Radonjic), gains from Mr. Duhamel’s poker gambling activities should only be considered business income if his predominant intention was to make a profit from this activity and that this activity was carried out in accordance with objective standards of businesslike behaviour.
[15] According to the appellant, an examination of these factors indicates that Mr. Duhamel was not carrying on a business by engaging in poker gambling activities. He had no training in this game. He did not have a plan and had not devised a system for beating the odds in poker. He did not use any particular strategy and did not have any insider information allowing him to win and thus beat the odds at poker. He did not devise a system for skewing the odds or minimizing risk. In addition, engaging in this type of gambling activity does not give rise to any expectation of profit in the medium or long term.
[16] Thus, according to the appellant, net gains from Mr. Duhamel’s poker gambling activities should not be included in the computation of his income for the purposes of the Act.
3.2 Respondent
[17] According to the respondent, the two‑stage approach described by the Supreme Court of Canada in Stewart should be used to determine whether Mr. Duhamel carried on a business by engaging in poker gambling activities during the years at issue.
[18] According to the respondent, an examination of factors propounded in Stewart indicates that Mr. Duhamel was carrying on a poker gambling business during the years at issue. The Stewart intention test must be based on objective factors, namely objective standards of businesslike behaviour. The Court must also come to this conclusion even if it were to hold that poker is not a game of skill but a game in which chance prevails over skill.
[19] Thus, according to the respondent, the evidence indicates that Mr. Duhamel used strategies to minimize his risks and implemented strategies to improve his technique, in particular by studying how his opponents played. Furthermore, based on the evidence, there is a reasonable expectation of profit from poker gambling activities because skill can affect poker gambling outcomes. The issue of whether poker is a game of chance or a game of skill is relevant in considering this factor. Although the respondent also acknowledged that chance played a decisive role in Mr. Duhamel’s victory in the 2010 WSOP Main Event tournament, the issue of the impact of chance and skill in poker must nevertheless be examined over a long period. According to Mr. Heeb, it is true that chance prevails in the first few hands of poker, but in the long run, skill prevails over chance.
[20] The respondent also submits that when examining the issue, the Court must consider financial motivation from another source related to gambling activities. The respondent argues that the Court must therefore consider Mr. Duhamel’s financial motivation from the sponsorship revenue paid by PokerStars to JD Co. under the PokerStars Agreement.
[21] Other factors akin to objective standards of businesslike behaviour must also be taken into account. These include the existence of records, retaining the services of an agent to negotiate sponsorship contracts, drafting profit‑sharing agreements following Mr. Duhamel’s qualification for the final table of the WSOP Main Event and the profitability analysis of the online poker gambling business conducted after the PokerStars Agreement ended in 2015.
[22] The respondent maintained that Mr. Duhamel’s poker gambling activities went well beyond mere entertainment. They constituted a concern in the nature of trade corresponding to the concept of an undertaking, particularly following the termination of the PokerStars Agreement pursuant to which Mr. Duhamel was required to participate in many tournaments in order to ensure that his corporation made money.
[23] According to the respondent, all these factors indicate that Mr. Duhamel carried on a poker gambling business during the years at issue. Thus, according to the respondent, the net gains from Mr. Duhamel’s poker gambling activities should be included as business income in computing his taxable income for the years at issue.
IV. THE ACT AND APPLICABLE LAW
[24] Subsection 3(a) provides that, in computing their income, taxpayers must include income from a source inside or outside Canada, including income from a business. Subsection 9(1) provides that a taxpayer’s income for a taxation year from a business or property is the taxpayer’s profit from that business or property for the year. Also, subsection 248(1) provides that the word “business” includes any concern in the nature of trade.
The relevant provisions of the Act read as follows:
3 The income of a taxpayer for a taxation year for the purposes of this Part is the taxpayer’s income for the year determined by the following rules:
(a) determine the total of all amounts each of which is the taxpayer’s income for the year (other than a taxable capital gain from the disposition of a property) from a source inside or outside Canada, including, without restricting the generality of the foregoing, the taxpayer’s income for the year from each office, employment, business and property.
[Emphasis added]
3 Pour déterminer le revenu d’un contribuable pour une année d’imposition, pour l’application de la présente partie, les calculs suivants sont à effectuer :
a) le calcul du total des sommes qui constituent chacune le revenu du contribuable pour l’année (autre qu’un gain en capital imposable résultant de la disposition d’un bien) dont la source se situe au Canada ou à l’étranger, y compris, sans que soit limitée la portée générale de ce qui précède, le revenu tiré de chaque charge, emploi, entreprise et bien;
[Non souligné dans l’original]
9 (1) Subject to this Part, a taxpayer’s income for a taxation year from a business or property is the taxpayer’s profit from that business or property for the year.
[Emphasis added]
9(1) Sous réserve des autres dispositions de la présente partie, le revenu qu’un contribuable tire d’une entreprise ou d’un bien pour une année d’imposition est le bénéfice qu’il en tire pour cette année.
[Non souligné dans l’original]
248(1) business
Includes a profession, calling, trade, manufacture or undertaking of any kind whatever and, except for the purposes of paragraph 18(2)(c), section 54.2, subsection 95(1) and paragraph 110.6(14)(f), an adventure or concern in the nature of trade but does not include an office or employment. (commerce)
[Emphasis added]
248(1) entreprise
Sont compris parmi les entreprises les professions, métiers, commerces, industries ou activités de quelque genre que ce soit et, sauf pour l’application de l’alinéa 18(2)c), de l’article 54.2, du paragraphe 95(1) et de l’alinéa 110.6(14)f), les projets comportant un risque ou les affaires de caractère commercial, à l’exclusion toutefois d’une charge ou d’un emploi.(business)
[Non souligné dans l’original]
[25] Whether poker is a game of chance or skill, or a game in which either chance or skill prevails, net gains from poker gambling activities will be included in computing Mr. Duhamel’s income, if such activities constitute a source of business income for the purposes of the Act.
[26] In Stewart, the Supreme Court of Canada set out the general principles for determining whether a taxpayer’s activities constituted a source of business or property income for the purposes of the Act. The Court set out a two‑stage approach for making this determination (Stewart, paragraph 50):
1- Is the activity of the taxpayer undertaken in pursuit of profit, or is it a personal endeavour?
2- If it is not a personal endeavour, is the source of the income a business or property?
[27] In this case, since the issue is whether Mr. Duhamel’s net gains from poker gambling activities constitute a source of income that is a business for the purposes of the Act, the second approach is not relevant.
[28] The purpose of the first approach is to distinguish between a taxpayer’s commercial and personal activities. It should be analyzed only in cases where the activities at issue involve a personal or hobby element (Stewart, paragraphs 54 to 55), such as poker gambling activities. In such a case, the first stage of the test was restated as follows: (Stewart, paragraph 54):
“Does the taxpayer intend to carry on an activity for profit and is there evidence to support that intention?”
[29] Ascertaining the intention to make a profit is both subjective and objective: first, the Court must determine whether the taxpayer’s predominant subjective intention is to make a profit. Secondly, it must determine whether this intention is corroborated by a variety of commercial factors (Stewart, paragraph 54).
[30] Indeed, a venture undertaken in a sufficiently commercial manner constitutes a source of income for the purposes of the Act. (Stewart, paragraph 52). To find that there is a source of income, the evidence must show that the activity at issue was carried out in accordance with objective standards of businesslike behaviour. The Court must make an overall assessment of whether the taxpayer is carrying on the activity in a commercial manner. Its role here is not to assess the taxpayer’s business acumen (Stewart, paragraph 55).
[31] To support the taxpayer’s subjective intention to make a profit, the following objective factors propounded by the Supreme Court of Canada in Moldowan v. The Queen, [1978] 1 SCR 480 (page 486) (Moldowan), were cited in Stewart (at paragraph 55):
- the profit and loss experience in past years;
- the taxpayer’s training;
- the taxpayer’s intended course of action; and
- the capability of the venture to show a profit.
[32] However, this list of factors is not exhaustive. These factors may differ with the nature and extent of the activities at issue. Also, the years at issue as well as subsequent years may be considered in examining these factors (see Moldowan, pages 483 to 484).
[33] The Supreme Court of Canada specified that one of the factors to be considered in determining whether activities have been carried out in accordance with objective standards of businesslike behaviour is the reasonable expectation of profit. However, this factor was not conclusive in the analysis (Stewart, at paragraph 55).
[34] More recently, the Federal Court of Appeal held that the factors propounded in Stewart were indeed relevant in determining the deductibility of gambling losses and expenses incurred by the taxpayer in connection with his gambling activities (which included horse racing, slots, casinos and lotteries). Such was the approach taken by our Court at first instance (Tarascio v. The Queen, 2012 FCA 30 (Tarascio). According to the Federal Court of Appeal, the trial judge applied the appropriate legal test by determining whether the activity “was conducted in a sufficiently commercial manner, that is, with the subjective intention of making a profit and objective evidence of business‑like behaviour” (Tarascio, at paragraph 3).
[35] However, given the nature of gambling activities, such as poker, the intention to make a profit is not a determining factor in the examination of the commerciality of this type of activity because all players are motivated by the pursuit of profit.[1]
[36] Hence, the case law has developed additional factors that must be considered to determine whether gambling activities are carried on in a sufficiently commercial manner to constitute a source of income for the purposes of the Act.
[37] First, the management or minimization of risk must be examined to answer the question at hand. Indeed, this factor characterizes the carrying on of a business (Balanko, at paragraph 10). The absence of an organized risk management or mitigation system supports the absence of a source of business income.
[38] This risk management or minimization factor was subsequently considered in Luprypa (at paragraphs 10 to14) and Leblanc (at paragraphs 33, 36, 43 and 48. More recently, our Court specified that this risk mitigation strategy must also be consistent and demonstrate that the taxpayer takes a serious approach to gambling (Cohen, at paragraph 44).
[39] Furthermore, the analysis of a gambling activity’s commerciality must take into account the taxpayer’s abilities, knowledge, skills and discipline. However, the frequency of gambling activities is of little relevance (Radonjic, at paragraph 52; Cohen, at paragraph 47; Leblanc, at paragraphs 28, 29, 46).
V. PRELIMINARY QUESTIONS
[40] At the hearing, documents marked as Exhibits I‑16, I‑17 and I‑18 were filed into the Court record subject to the Court’s decision regarding the appellant’s objections to their being filed as evidence. The appellant also objected to the testimony of Martin Fournier‑Giguère, one of the respondent’s witnesses.
[41] The Court’s decision on this matter must be based on the laws of evidence in force in Quebec, in particular the rules found in Book Seven of the Civil Code of Québec (C.C.Q.).[2]
5.1 Mr. Fournier‑Giguère’s testimony and document filed as Exhibit I‑16
[42] The document filed as Exhibit I‑16 is Martin Fournier‑Giguère’s November 12, 2010, blog posted on the BlueFire Poker site. Since the respondent agreed to withdraw this document from evidence before the close of the hearing, the Court will not rule on the merits of the objection raised by the appellant. Furthermore, since the appellant has withdrawn his objection to Mr. Fournier‑Giguère’s testimony, this testimony will be part of the evidence.
5.2 Documents filed as Exhibits I‑17 and I‑18
[43] The Court must rule on the objections raised by the appellant regarding the documents filed as Exhibits I‑17 – an article by Jean François Boily published in the spring 2011 edition of Magazine HOMME entitled “Un champion comme vous et moi” and I‑18 – an article written by Guillaume Cloutier published in Le Courrier du Sud on August 4, 2010, entitled “‘All‑In’ avec Jonathan Duhamel”.
[44] The respondent seeks to have previous statements by Mr. Duhamel reported in these articles by Mr. Boily and Mr. Cloutier admitted into evidence as testimony. The purpose is not to impugn Mr. Duhamel’s credibility or contradict previous statements that he does not recall.
[45] The statements appear in quotation marks in the article written by Mr. Boily (Exhibit I‑17). With respect to Mr. Cloutier’s article (Exhibit I‑18), the respondent seeks to enter into evidence Mr. Duhamel’s answers to the various issues raised in the story.
Discussion:
[46] For the following reasons, the objections raised by the appellant regarding the documents filed as Exhibits I‑17 and I‑18 are upheld because the reliability of Mr. Duhamel’s previous statements reported by the journalists is not sufficiently guaranteed pursuant to article 2871 of the C.C.Q. Even if these previous statements had been admissible as testimony under article 2871 of the C.C.Q., the conditions found in the second paragraph of article 2873 C.C.Q. were not met, which means that Mr. Duhamel’s previous statements cannot be entered into evidence by filing these press articles. The documents marked as Exhibits I‑17 and I‑18 will therefore not be filed into the Court record as evidence of the content of Mr. Duhamel’s previous statements.
[47] As the appellant did not consent to the production of the articles at issue and Mr. Duhamel was appearing as a witness, Mr. Duhamel’s out‑of court statements reported in these press articles may only be admitted as testimony if the reliability test set out in article 2871 of the C.C.Q. is satisfied.
[48] Article 2871 of the C.C.Q. reads as follows:
2871. Previous statements by a person who appears as a witness, concerning facts to which he may legally testify, are admissible as testimony if their reliability is sufficiently guaranteed.
2871. Lorsqu’une personne comparait comme témoin, ses déclarations antérieures sur des faits au sujet desquels elle peut légalement déposer peuvent être admises à titre de témoignage, si elles présentent des garanties suffisamment sérieuses pour pouvoir s’y fier.
[49] After finding that the reliability of a previous statement is sufficiently guaranteed and is therefore admissible as testimony, the Court must determine how the statement can be proved by referring to sections 2872 to 2874 of the C.C.Q. In this case, only article 2873 of the C.C.Q. is relevant. Mr. Duhamel’s previous statements could therefore be proved by producing the press articles, if the conditions found in article 2873 C.C.Q. are satisfied.
[50] Article 2873 of the C.C.Q. reads as follows:
2873. A statement recorded in writing by a person other than the declarant may be proved by producing the writing if the declarant has acknowledged that the writing faithfully reproduces his statement.
The same rule applies where the writing was drawn up at the request of the declarant or by a person acting in the performance of his duties, if there is reason to presume, having regard to the circumstances, that the writing faithfully reproduces the statement.
[Emphasis added]
2873. La déclaration, consignée dans un écrit par une personne autre que celle qui l’a faite, peut être prouvée par la production de cet écrit lorsque le déclarant a reconnu qu’il reproduisait fidèlement sa déclaration.
Il en est de même lorsque l’écrit a été rédigé à la demande de celui qui a fait la déclaration ou par une personne agissant dans l’exercice de ses fonctions, s’il y a lieu de présumer, eu égard aux circonstances, que l’écrit reproduit fidèlement la déclaration.
[Non souligné dans l’original]
[51] According to the respondent, Mr. Duhamel’s previous statements as reported by the journalists provides a better guarantee of reliability than the testimony that Mr. Duhamel gave 10 years later. Based on Mr. Boily’s testimony, the Court can accept as a matter of course that the press article faithfully reproduced Mr. Duhamel’s previous statements. Similarly, Mr. Cloutier’s testimony regarding the circumstances of the interview, the audio recording of the interview and the written notes taken during the interview are evidence of the reliability of Mr. Duhamel’s previous statements reported in the article.
[52] The Court does not accept the respondent’s arguments and concludes that the reliability test set out in article 2871 of the C.C.Q. is not satisfied in this case.
[53] First of all, I would note that article 2871 of the C.C.Q. includes previous consistent statements as well as previous inconsistent statements.[3]
[54] The Court must ascertain whether the circumstances surrounding the statements ensure that their reliability is sufficiently guaranteed. A statement is reliable if it “is made under circumstances which substantially negate the possibility that the declarant was untruthful or mistaken . . . (R. v. Smith, [1992] 2 SCR 915, page 933). Although those comments were made in a criminal law case, they also apply in the context of the Quebec civil law.[4]
[55] The interview with Mr. Boily took place when JD Co. and PokerStars had already entered into the PokerStars Agreement, to which Mr. Duhamel was a party. The evidence indicates that Mr. Duhamel was required to promote PokerStars, and more specifically, to promote the PokerStars online poker gambling site to encourage poker players to play there. Mr. Duhamel was also hired to assert that it was possible to make a living playing poker by practising and playing on the PokerStars online poker gambling site. Mr. Duhamel had already taken public relations training provided by the PokerStars team to learn to convey the message he was required to deliver to meet his obligations to PokerStars.
[56] Mr. Cloutier interviewed Mr. Duhamel after he qualified for the final table of the WSOP Main Event, but before he won the tournament. The PokerStars Agreement had therefore not yet been signed. However, the evidence indicates that, after he qualified for the final table, Mr. Duhamel was approached by PokerStars representatives who advised him to give good interviews and speak highly of PokerStars.
[57] The evidence shows that Mr. Duhamel was promoting the interests of PokerStars and sticking to talking points that favoured PokerStars’ interests. As a result, the reliability of the statements in Exhibits I‑17 and I‑18 cannot be assured.
[58] However, even if the Court had held that the statements were admissible as testimony pursuant to article 2871 of the C.C.Q., the press articles could not be produced to prove Mr. Duhamel’s previous statements, because the conditions set out in the second paragraph of article 2873 of the C.C.Q. are not satisfied. The Court finds that “there is [no] reason to presume, having regard to the circumstances, that the writing faithfully reproduces the statement.”
[59] First, both Mr. Boily and Mr. Cloutier testified that they did not recall the content of their press articles. They had to rely on the content of their articles to answer questions at the hearing.
[60] Mr. Boily testified that Mr. Duhamel was interviewed at the Montreal Casino about two months before the magazine was published. Mr. Boily showed up alone for the interview, with a notepad. However, he no longer has this notepad. It was a casual interview. He was always careful to note the statements made during the interview. However, Mr. Boily testified that he had chosen the parts of the statements to be included in his article because the goal was to attract the target audience’s (men) attention and that everything had to meet the publisher’s commercial requirements.
[61] In his testimony, Mr. Cloutier told the Court that when Mr. Duhamel returned from Las Vegas after qualifying for the final table of the WSOP Main Event in July 2010, he met with Mr. Duhamel at a Tim Hortons restaurant on Montreal’s South Shore. Mr. Cloutier conducted a question and answer interview. He had a recorder and a notepad to record Mr. Duhamel’s words. However, he was unable to produce this recording and the notepad at the hearing. He did not keep any notes, transcripts or audio recordings of the interview. Mr. Cloutier also testified that most of the topics discussed during the interview were reported in the article, but some parts may have been removed because they were deemed irrelevant. According to Mr. Cloutier, a press article must meet a word count requirement, and that article, in particular, was abridged.
[62] Although the Court does not doubt the journalistic ethics and professional integrity of the authors of the press articles at issue, it finds that the requirements set out in the second paragraph of article 2873 of the C.C.Q providing that the writing faithfully reproduce the previous statements are not satisfied. The evidence shows that editorial choices were made in the writing of press articles to provide a product that met various commercial criteria. As indicated above, Mr. Boily’s article was written to attract the target readership (men) and all the foregoing had to meet the publisher’s commercial requirements. Mr. Boily cannot confirm the accuracy of the statements reported in his article, and Mr. Cloutier’s article was abridged to meet the editor’s word count requirement. Also, Mr. Cloutier did not remember the content of Mr. Duhamel’s statements. Furthermore, at the hearing, neither author was able to produce the notes and recordings made at the time.
VI. THE CREDIBILITY OF MR. DUHAMEL’S TESTIMONY AND THE BOOK ENTITLED “Cartes sur table: Champion du monde de poker 2010”
6.1 Credibility of Mr. Duhamel’s testimony
[63] The Court is of the view that Mr. Duhamel’s testimony at the hearing was generally reliable, consistent and credible. Several aspects of his testimony were corroborated by the documentary evidence, as well as by the testimony provided by Mr. Fournier‑Giguère. Other parts of Mr. Duhamel’s testimony, when considered with common sense, are entirely plausible.
[64] First, Mr. Fournier‑Giguère is a friend of Mr. Duhamel whom he met during web forum discussions. Mr. Fournier‑Giguère was called to testify at the hearing for the respondent. He confirmed several aspects of Mr. Duhamel’s testimony, including the fact that during the years at issue, Mr. Duhamel partied heavily.
[65] Mr. Fournier‑Giguère was also part of the group of Quebec friends who rented a house in Las Vegas in July 2010 at the time of the WSOP Main Event, but he did not stay at Mr. Duhamel’s house. Mr. Fournier‑Giguère participated in the WSOP Main Event but did not qualify for the final table. He had signed a gain‑sharing agreement with Mr. Duhamel and received 5% of Mr. Duhamel’s prize. According to Mr. Fournier‑Giguère, he and his friends, including Mr. Duhamel, threw big parties, gambled and bet large amounts of money on golf and went out a lot. Mr. Fournier‑Giguère also said that Mr. Duhamel partied even more than he did.
[66] Mr. Fournier‑Giguère returned to Las Vegas in November 2010 to encourage Mr. Duhamel when he qualified for the final table of the WSOP Main Event. This supports Mr. Duhamel’s testimony regarding his state of mind and the reason for signing sharing agreements, which was to create team spirit among the signatories.
[67] Also, Mr. Duhamel’s testimony regarding the PokerStars Agreement was consistent with the content of the sharing agreements. The Court will return to this later.
[68] However, the respondent was of the view that Mr. Duhamel’s credibility was tainted by his inability to recall the number of online poker game accounts he opened and the approximate dates on which they were opened, when he represented PokerStars between late November 2010 and 2015. Similarly, he did not recall the number of tournaments he played abroad in 2009 and the time of year when he acquired his condominium in 2009.
[69] According to the Court, it is quite plausible that Mr. Duhamel did not remember the exact dates on which he opened his online gambling accounts, even though he represented PokerStars for several years, nor was it surprising that he did not recall the number of online poker game accounts he had in his early adulthood. Mr. Duhamel said he did not remember when he started playing online poker because you can play for fun or money as an adult. He testified that, after being sponsored by PokerStars, he only played on the PokerStars online poker gambling site, as required under the PokerStars Agreement.
[70] Mr. Duhamel also testified that he recorded all his in‑person tournament results on an Excel file. When the audit for the 2010 and 2011 taxation years started, he prepared a clearer document to be sent to the auditor. However, since the 2009 taxation year was not at issue, he did not prepare a clearer document for that year. The evidence indicates that the auditor did not ask Mr. Duhamel any questions regarding the years prior to 2010 and admitted that he did not request any information from Mr. Duhamel regarding the 2008 and 2009 taxation years. Mr. Duhamel therefore cannot submit a similar document or verify the information for 2009 because the data were not saved.
[71] The Court is of the view that although Mr. Duhamel had difficulty remembering the time of year when he purchased his condominium, this did not undermine the credibility of his testimony. On the contrary, Mr. Duhamel gave an approximate purchase price for the condominium that was very close to the price paid, which showed he was willing to answer the Court’s questions frankly.
[72] The respondent also argues that Mr. Duhamel’s credibility was tainted because he found it difficult to calculate the years when he was 15, 16 or 18 years of age, whereas he was able to perform more complicated calculations such as probability calculations based on “outs” or percentages and other additions/subtractions in poker.
[73] However, the evidence indicates that the calculations to which the respondent referred were quite simple, given that the probabilities involved are calculated approximately by multiplying by a factor of 2 or 4, and the various percentages are based on a denominator of 10. Mr. Duhamel’s credibility was therefore not tainted by these elements.
6.2 Statements by Mr. Duhamel cited in the Book entitled “Cartes sur table : Champion du monde de poker 2010”
[74] A book on Mr. Duhamel entitled “Cartes sur table : Champion du monde de poker 2010” was published in 2011 (the Book) and was entered into evidence at the hearing.
[75] During the hearing, the respondent sought to elicit evidence of Mr. Duhamel’s state of mind by cross‑examining him on certain statements in the Book. The respondent sought to provide evidence of the skills demonstrated by Mr. Duhamel in poker, including his use of various playing strategies.
[76] According to Mr. Duhamel, some parts of the Book accurately reflected the facts as well as his thoughts and state of mind, while other parts were included in response to requests from his sponsor, PokerStars. Given this answer and the other elements raised in the previous section, the respondent asked the Court to infer that Mr. Duhamel was a person who considered himself entitled to mislead his readers and distort the truth, as consideration for a lucrative sponsorship contract. According to the respondent, the Court should therefore not find Mr. Duhamel’s testimony credible.
[77] For the following reasons, the Court cannot draw the inference suggested by the respondent because very little probative value should be given to previous statements made by Mr. Duhamel that were included in the Book.
[78] The evidence indicates that friends of Mr. Duhamel suggested that he write a book. Since PokerStars was sponsoring Mr. Duhamel at the time, he had to obtain his sponsor’s permission to undertake this project. He therefore held discussions with PokerStars on the message that the Book would convey. PokerStars and Mr. Duhamel established a plan in this regard. A ghostwriter wrote all 18 chapters of the Book. Mr. Duhamel reviewed the material written by the ghostwriter and provided his approval. However, PokerStars did not review the contents of the Book.
[79] It seems likely that Mr. Duhamel had an altogether minor involvement in the drafting of the Book because it contained obvious errors. For instance, the Book stated that Mr. Duhamel took finance courses at university, but he actually took administration courses. According to the Book, the WSOP Main Event started in May 2010, but it started in July 2010; Mr. Duhamel took a sabbatical year after his second year of university, but he actually took the sabbatical year after his first year of university studies.
[80] The Book also stated that Mr. Duhamel researched his opponents and used applications or software that provided statistics on poker players. However, the evidence shows that, in tournaments, players do not know who their opponents will be and cannot choose their gambling table. It also indicates that Mr. Duhamel did not use such applications or software because he found them rather disturbing, and that interfered with his concentration.
[81] As Mr. Dufour said, the Book was autobiographical. The Book included basic general principles: discipline, self‑control, maintaining your passion for poker, concentration, etc., but did not reveal any structured and serious method likely to help the player win a tournament.
[82] While the evidence indicates that Mr. Duhamel reviewed the contents of the Book, it was written while Mr. Duhamel was a spokesperson for PokerStars. One of the purposes of the Book was to encourage people to play on the PokerStars online poker gambling site. Mr. Duhamel testified that he consulted PokerStars before starting this project. PokerStars approved the message to be conveyed in the Book. In addition, the author thanked PokerStars in the last pages of the Book. Several statements in the Book showed the image that Mr. Duhamel had to project for sponsorship purposes: to become a world champion in poker, a player must practice online and study the game; the more a player practices, the more successful he will be; a player must read treatises on poker. These statements were included in the Book to satisfy PokerStars’ requirements and convey the message that Mr. Duhamel was supposed to deliver.
[83] Also, testimony provided at the hearing contradicted some statements in the Book. For example, according to the Book, a player must maintain a healthy lifestyle to win at poker, whereas Mr. Duhamel clearly testified that he partied and did not maintain this type of lifestyle. As noted above, Mr. Fournier‑Giguère’s testimony corroborated Mr. Duhamel’s testimony in this regard.
[84] In addition, according to the Book, Mr. Duhamel read books on poker written in English to improve his game. Contrary to what the Book said, the evidence indicates that Mr. Duhamel did not learn poker theory before he