Federal Court Overturns Unreasonable Decision on CERB Eligibility
📌 In brief
In a recent Federal Court decision, a claimant's eligibility for benefits under the Canada Emergency Response Benefit (CERB) was reviewed. The Court found the original decision to be unreasonable because it lacked clear and understandable reasons for denying the claimant's eligibility.
⚖️ Legal holding
A decision must provide clear and understandable reasons to justify its conclusion.
📖 Technical summary
The decision is unreasonable due to insufficient justification and lack of clarity in the decision-making process.
📜 Headnote Official document
The Federal Court overturned a decision made by the Canada Revenue Agency regarding the eligibility of a claimant for benefits under the Canada Emergency Response Benefit (CERB). The Court found the decision to be unreasonable due to insufficient justification and lack of clarity in the decision-making process.
📚 Full judgment Official document
Date: 20260514 Docket: T-4645-25 Citation: 2026 FC 629 Vancouver, British Columbia, May 14, 2026 PRESENT: Mr. Justice Norris BETWEEN: [NAME] Applicant and Attorney General of Canada Respondent
REASONS AND
JUDGMENT [ 1 ] The applicant received benefits under the Canada [NAME] Act , SC 2020, c 5, s 8 between March and September 2020. After a review of her eligibility for these benefits, the Canada Revenue Agency concluded that the applicant was not eligible for the benefits because (1) she earned more than $1,000 of employment or self-employment income when she was receiving the benefits and (2) she did not stop working or have her hours reduced for reasons related to COVID-19. [ 2 ] The applicant has applied for judicial review of this decision on the basis that it is unreasonable. [ 3 ] I agree with the applicant that the decision is unreasonable. To show why, I can do no better than to quote the decision maker’s reasons in their entirety ( sic throughout): [NAME] is not eligible for CERB (1-7) due to not meeting 1k income criteria and did had hours reduced because of Covid . [NAME] has dividend incme in 2020, For dividend income, Dividends Other $47,150in 2020, not able to validate with he docs sent in any frequency/pattern of dividends, From the docs sent in [NAME] book Reconstruction report from Dec 2019 to Feb 2021, no transaction highlighted , not able to visualize which transactions are related to dividends. Also, from corporation stetments sent in unable to validate ethe dividends income. Moreover, [NAME] also issued Pay to self and also has employment income from her own corporation for $35,000.00. According to the Pay stubs and PD7A for the following months of 2020 from [COMPANY] , [NAME] paid to self $ 3,000 each month from January to April, and then suddenly in December 2020 paid to herself $ 23,000. These pays tubs don’t reconcile with the personal [NAME] statements sent in. There are no such amounts in [NAME] personal statements. [NAME] attested on Oct 2, 2025, that dividend funds are disbursed from the Corporation to their personal bank account at the end of the year after bookkeeping (+/-) to establish how much dividends should be issued. So, requested [NAME] to send in bank statements highlighting dividends, and her pay stubs deposited, [NAME] just sent in bank stetments, none of the transactions marked. As [NAME] had the Provision to pay herself as and when required, so unable to validate [NAME] income. Unable to validate if [NAME] had reduced hours , or was eligible according to 1k. As the , clearly [NAME] is not eligible for any of the CERB periods CERB ( 1-7) for not meeting 1k eligibility. Moreover, Pay stubs and PD7A for the following months of 2020 from [COMPANY] the amounts are not reconciling with any of the bank deposit. Moreover, [NAME] had no schedules/track hours to see the stoppage of work or reduction in hours due to COVID, so [NAME] do not meet the eligibility condition for did not stop working or had hours reduced because of COVID, as this is documents driven review. CERB ( 1-7), periods will remain ineligible and reason code will be changed to Secondary Review. [ 4 ] An administrative decision maker’s reasons do not need to be perfect ( Canada (Minister of Citizenship and Immigration) v Vavilov , 2019 SCC 65 at para 91). But they must be intelligible. The party to whom they pertain must be able to understand them ( Vavilov , at para 86). And for a decision to survive judicial review, the reviewing court must be able to determine whether, given the law that constrains the decision maker, there is a line of analysis “that could reasonably lead the tribunal from the evidence before it to the conclusion at which it arrived” ( Vavilov , at para 102). [ 5 ] In the present case, to the extent that the reasons are even intelligible, which is hardly at all, the decision maker’s stream of consciousness approach completely obscures any line of analysis that could reasonably have supported the conclusion that the applicant was not eligible for the benefits she received. To state the obvious, even when read against the background of the record, including the decisions maker’s communications with the applicant, the decision maker’s reasons fail to exhibit the requisite degree of justification, intelligibility and transparency for the decision to be reasonable ( Vavilov , at para 100). The matter must be reconsidered. [ 6 ] The applicant, who is self-represented, did not seek costs so none will be awarded. [ 7 ] Finally, in her notice of application, the applicant named the Minister of National Revenue as the respondent. The correct respondent is the Attorney General of Canada ( Federal Courts Rules , SOR/98-106, Rule 303(2)). The style of cause will be amended accordingly.
JUDGMENT IN T-4645-25 THIS COURT’S
JUDGMENT is that The style of cause is amended to name the Attorney General of Canada as the correct respondent. The application for judicial review is allowed. The decision dated October 30, 2025, is set aside and the matter is remitted for redetermination by a different decision maker. No costs are awarded. “John Norris” Judge FEDERAL COURT SOLICITORS OF RECORD DOCKET: T-4645-25 STYLE OF CAUSE: [NAME] v Attorney General of Canada PLACE OF HEARING:
HELD BY VIDEOCONFERENCE DATE OF HEARING: May 14, 2026
REASONS AND
JUDGMENT: NORRIS J. DATED: May 14, 2026 APPEARANCES : [NAME] ON HER [NAME] For The Respondent SOLICITORS OF RECORD : Attorney General of Canada Vancouver, British Columbia For The Respondent
⚖️ What tends to weigh in cases like this
✅ Tends to be accepted
- The decision must provide clear and understandable reasons to justify its conclusion.
- The court found the original decision maker's reasons were not intelligible.
- The court determined that the decision maker's reasons failed to justify the conclusion.
- The court noted that the decision maker's stream of consciousness approach obscured any logical reasoning.
- The court emphasized the need for justification, intelligibility, and transparency in administrative decisions.
❌ Tends to be rejected
- The decision maker used a stream of consciousness approach that was hard to follow.
- The decision maker failed to provide a clear explanation linking evidence to conclusions.
- The decision maker did not validate the applicant's income in a transparent manner.
- The decision maker could not reconcile the applicant's pay stubs with her personal statements.
- The decision maker did not provide sufficient documentation to support the conclusion that the applicant was not eligible for benefits.
Patterns observed in similar cases in this collection — every case is unique.
❓ Frequently asked questions
What did this decision decide?
The Federal Court decided to overturn the Canada Revenue Agency's decision regarding the claimant's eligibility for benefits under the CERB.
What was the dispute about?
The dispute was about whether the claimant met the eligibility requirements for benefits under the CERB.
How did the court decide, and why?
The court decided that the original decision was unreasonable because it failed to provide clear and understandable reasons for denying the claimant's eligibility.
Which laws or rules were applied?
The decision did not cite specific laws or rules, but it was based on the principles of judicial review and the requirement for decisions to be reasonable.
What was the argument that mattered most?
The argument that mattered most was that the original decision lacked clarity and justification, making it unreasonable.
Was the decision for or against the person who brought the case?
The decision was for the person who brought the case, as the Court found the original decision to be unreasonable.
What does this mean for someone in a similar situation?
Someone in a similar situation may be able to challenge an unreasonable decision regarding their eligibility for benefits under the CERB.
What evidence or documents mattered?
The judgment does not specify the exact evidence or documents that mattered in the decision.