Date: 20050601
Docket: GST-1343-03
Citation: 2005 FC 788
Ottawa, Ontario, this 1st day of June, 2005
PRESENT: THE HONOURABLE MR. JUSTICE JOHN A. O'KEEFE
IN THE MATTER OF: The Excise Tax Act, R.S.C. 1985, c. E-15
AND IN THE MATTER OF: An Assessment or Assessments by the Minister
of National Revenue under the Excise Tax Act
AGAINST:
KIM OANH VU (sometime known as OANH KIM VU,
sometime carrying on business as 129 SMOKE AND VARIETY)
77 Beckenridge Drive, Markham Ontario L3S 3B1
REASONS FOR ORDER AND ORDER
O'KEEFE J.
[1] This is a motion pursuant to Rule 50 of the Federal Court Rules, 1998, appealing the order of Prothonotary Lafrenière dated December 31, 2004, whereby he dismissed the appellant's motions dated June 3, July 12 and July 19, 2004.
[2] The appellant had brought the three motions in writing seeking various relief and more particularly, an order quashing a certificate obtained by the Minister of National Revenue (the "Minister") for unremitted GST and lifting a lien registered against the property at 77 Beckenridge Drive in Markham, Ontario, on the grounds that the appellant did not receive either a proposal letter sent by the Minister or a notice of reassessment relating to the unremitted GST, and was therefore unable to appeal the notice of reassessment.
[3] The applicant, Kim Oanh Vu ("Vu") claimed that she never received letters containing a proposed reassessment for unremitted GST and a notice of reassessment. As a result, she did not appeal the reassessment within the time set out in the Excise Tax Act, R.S.C. 1985, c. E-15 (the "Act"). Vu did receive a letter from the Minister in November 2003, sent to the same address as the proposed reassessment and the notice of reassessment. This latter letter informed Vu that the Minister had registered the GST debt on the property registry system.
[4] Vu submitted that the Minister had not proven the service of the notice of reassessment on her.
[5] The Minister submitted that proper service of the notice of reassessment had been made.
[6] Prothonotary Lafrenière found that the notice of reassessment was properly sent by the Minister and received by Vu.
[7] The Prothonotary ordered costs against Vu and another party in the amount of $2,000 plus disbursements, payable forthwith to the Minister.
[8] Before me, Vu submitted that the Prothonotary's decision ought to be set aside as the Minister had not proven the service of the notice of reassessment in accordance with subsection 395(1) of the Act.
[9] The Minister, on the other hand, submitted that the notice of reassessment was sent by ordinary mail and that service had been proven.
[10] Issue
Should the Prothonotary's order be set aside?
Relevant Statutory Provisions
[11] Subsections 300(1), 334(1) and 335(1) of the Act state as follows:
| 300. (1) After making an assessment, the Minister shall send to the person assessed a notice of the assessment.
334. (1) For the purposes of this Part and subject to subsection (2), anything sent by first class mail or its equivalent shall be deemed to have been received by the person to whom it was sent on the day it was mailed.
335. (1) Where, under this Part or a regulation made under this Part, provision is made for sending by mail a request for information, a notice or a demand, an affidavit of an officer of the Agency, sworn before a commissioner or other person authorized to take affidavits, setting out that the officer has knowledge of the facts in the particular case, that such a request, notice or demand was sent by registered or certified mail on a named day to the person to whom it was addressed (indicating the address), and that the officer identifies as exhibits attached to the affidavit the post office certificate of registration of the letter or a true copy of the relevant portion thereof and a true copy of the request, notice or demand, is evidence of the sending and of the request, notice or demand.
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300. (1) Une fois une cotisation établie à l'égard d'une personne, le ministre lui envoie un avis de cotisation.
334. (1) Pour l'application de la présente partie, tout envoi en première classe ou l'équivalent est réputé reçu par le destinataire à la date de sa mise à la poste.
335. (1) Lorsque la présente partie ou un règlement d'application prévoit l'envoi par la poste d'une demande de renseignements, d'un avis ou d'une mise en demeure, l'affidavit d'un fonctionnaire de l'Agence, souscrit en présence d'un commissaire ou autre personne autorisée à le recevoir, constitue la preuve de l'envoi ainsi que de la demande, de l'avis ou de la mise en demeure, s'il indique que le fonctionnaire est au courant des faits de l'espèce, que la demande, l'avis ou la mise en demeure a été envoyé par courrier recommandé ou certifié à une date indiquée à l'intéressé dont l'adresse est précisée et que le fonctionnaire identifie comme pièces jointes à l'affidavit, le certificat de recommandation remis par le bureau de poste ou une copie conforme de la partie pertinente du certificat et une copie conforme de la demande, de l'avis ou de la mise en demeure.
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Analysis and Decision
[12] Standard of Review
Because the decision of the Prothonotary raises a matter vital to the final issue of the case, I must exercise my discretion de novo in the sense that I must review the filed material before the Prothonotary and come to my own decision (this is not a true de novo hearing) (see Canada v. Aqua-Gem Investments Ltd., [1993] 2 F.C. 425 (C.A.)).
[13] At the hearing of this motion, the applicant argued that the Minister needed to follow the requirements of subsection 235(1) of the Act in order to prove that the notice of reassessment was sent to the applicant. The Minister submitted that the notice of reassessment was sent by ordinary mail and that according to Schafter v. R., [1988] G.S.T.C. 60 (T.C.C.), the Minister had proven that the notice was sent to the applicant.
[14] Section 300 of the Act requires the Minister to send the notice of reassessment to the applicant. The Act does not specify that the notice be sent by registered mail. In the present case, the Minister sent the notice by ordinary mail and as outlined by Prothonotary Lafrenière in his reasons, the Minister provided affidavit evidence to set out the detailed procedure followed in mailing the notice in question. The Prothonotary was correct in stating that the Minister did not have to prove receipt of the notice of reassessment by the applicant.. I am also of the view that Prothonotary Lafrenière was correct in stating that the Minister had proved that the notice was sent to the applicant. The Minister tendered uncontradicted affidavit evidence to show the detailed procedure for the mailing of documents such as notices of reassessment (see paragraphs 13 and 14 of the Prothonotary's decision). According to the dicta in Schafer, supra, this was sufficient to prove that the notice of reassessment had been sent to the applicant. The process for proving sending of the notice of reassessment by ordinary mail outlined in Schafter, supra, was not overruled by the Court of Appeal in Schafter v. R., [2000] N.R. 262 (F.C.A.).
[15] The applicant's argument with respect to the application of subsection 335(1) of the Act would apply if the notice of reassessment had been sent by certified or registered mail. I agree that the Minister did not meet the proof required by subsection 235(1), but in this case, the notice of reassessment was not sent by certified or registered mail.
[16] In exercising my discretion de novo, I have come to the same conclusion as the Prothonotary. The Minister has proven the sending of the notice of reassessment to the applicant. Prothonotary Lafrenière was correct in his conclusions.
[17] The applicant's motion (appeal) is therefore dismissed.
[18] The Minister requested costs in the amount of $750 payable forthwith. Should the costs awarded not be paid, and if there are any surplus funds left in Court after the bank is paid out, then the costs shall be paid from those surplus funds. The applicant submitted that she should receive costs if she is successful, being $250 paid as a result of the order of Rouleau J. plus $750.
[19] The Minister shall have costs in the amount of $750 inclusive of disbursements, payable forthwith. If any surplus remains in Court after the bank is paid, and the costs have not been paid, then the costs shall be paid from that surplus.
ORDER
[20] IT IS ORDERED that:
1. The applicant's motion (appeal) is dismissed.
2. The Minister shall have costs in the amount of $750 inclusive of disbursements and payable forthwith. Should the costs awarded not be paid and there are any surplus funds remaining in Court after the bank is paid out, the costs shall be paid from those surplus funds to the extent possible.
Ottawa, Ontario
June 1, 2005
FEDERAL COURT
NAME OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: GST-1343-03
STYLE OF CAUSE: GST
KIM OANH VU (OANH KIM VU
SMOKE AND VARIETY)
PLACE OF HEARING: Toronto, Ontario
DATE OF HEARING: May 16, 2005
REASONS FOR ORDER AND ORDER OF: O'KEEFE J.
DATED: June 1, 2005
APPEARANCES:
P. Tamara Sugunasiri
SOLICITORS OF RECORD:
John H. Sims, Q.C.
Deputy Attorney General of Canada
Carl Schuetz
Toronto, Ontario
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