McNair, J.: —This is an interlocutory application by the defendant to strike the plaintiff's statement of claim on the following stated grounds, viz:
1. The Plaintiff's Statement of Claim be struck out pursuant to Rule 419 of the Federal Court Rules by reason of the fact that the said pleading constitutes a departure from the same party's pleading in another action before this Honourable Court and constitutes an abuse of the process of this Honourable Court.
The defendant carried on business as a Ford automobile dealership in the town of Grand Falls, New Brunswick. The defendant and the subsequent dealership, Violette Motors Limited, had a contractual relationship with their supplier, Ford Motor Company of Canada Limited (hereinafter referred to as "Ford"). By the terms of their contractual relationship, the defendant and Violette Motors Limited had the right to pick up new automobiles directly from the Ford assembly plant in Oakville, Ontario. In 1968 Ford unilaterally purported to alter the contractual relationship with the defendant whereby Ford began to charge the defendant for pick-up and delivery even though no pick-up and delivery services were ever performed. The defendant protested this unilateral action by Ford but the charges were paid by Ford Motor Credit Corporation pursuant to the wholesale financing plan in existence at the time. These extra costs were included in the defendant's accounting records as operating expenses.
On March 29, 1977 the defendant commenced legal proceedings against Ford in the Court of Queen's Bench of New Brunswick Trial Division for declaration of the plaintiff's rights and recovery of the pick-up and delivery charges and interest thereon. On September 16, 1980 the Court issued a judgment granting the relief sought and awarding damages to the defendant and Violette Motors Limited in the sum of $310,442.50 for the period from January 1, 1972 to December 15, 1978, plus interest thereon. The New Brunswick Court of Appeal upheld the decision at trial in a judgment pronounced on April 16, 1981. An application by Ford for leave to appeal to the Supreme Court of Canada was dismissed on October 19, 1981.
On July 16, 1981, the defendant commenced a second action against Ford for damages and interest arising from continuing breach of contract in respect of pick-up and delivery charges from December 15, 1978 to March 21, 1980. This second action was ultimately settled by the parties and discon- tinued upon the execution of a release. The release is formally dated “this
day of February A.D. 1982”. The plaintiff maintains that the defendant received the amounts of $51,182.44 income and interest of $27,579.16 as its share of the second action.
On September 16, 1983 the Minister of National Revenue reassessed the defendant in respect of the 1981 taxation year and added $404,086.50 to the active business income and $217,738.67 to the income of the defendant for that year. By notice of objection dated December 12, 1983 the defendant disputed the aforementioned assessment for the 1981 taxation year. On January 8, 1985 the Minister rejected the notice of objection aforesaid. The assessment was revised, however, to add a total of $436,759.44 to the defendant's income for the 1981 taxation year.
The defendant filed a notice of appeal for the 1981 taxation year with the Tax Court of Canada on February 26, 1985. This appeal was identified as Appeal Number 85-362.
By letter dated May 14, 1985 Revenue Canada indicated that the above mentioned sum of $436,759.44 would be removed from the 1981 taxation year and assessed in 1980 and 1982. On June 19, 1985 the Minister of National Revenue reassessed the defendants in respect of the 1980 taxation year by adding $357,997.84 to the taxpayer's income. The 1982 taxation year was also reassessed on that date to add a further $78,761.60 to the taxpayer's income for that year. These assessments were duly appealed to the Tax Court of Canada and identified as Appeal Numbers 86-8 and 86-9.
On February 3, 1987 the Tax Court dismissed these appeals and upheld the Minister's assessment on the ground that the amount of $435,516.59 was received by the taxpayer as business income and was therefore on income account and not on capital account.
The present defendant's appeal in the action known as Appeal Number 85-362 was allowed by the Tax Court of Canada on July 8, 1987 and the matter was referred to the Minister for reconsideration and reassessment.
The plaintiff's present action (T-1276-87) is an appeal from that decision to the Federal Court of Canada. The plaintiff alleges in paragraphs 11(g), 11(i), 13, and 14 of its statement of claim herein that the amounts of $51,182.44 and $27,579.16 must be included as income from business in the defendant's 1981 taxation year.
On June 17, 1987 W.H. Violette Limited appealed the decision of the Tax Court of Canada rendered on February 3, 1987 with respect to the reassessments for its 1980 and 1982 taxation years (T-1329-87). In this other action in which Her Majesty the Queen is defendant, the plaintiff, W.H. Violette Limited, makes the following alternative plea in paragraph 25 of its statement of claim:
25. The Plaintiff says further the Minister issued an assessment for the said amount for the 1981 taxation year on or about the 16th day of September, 1983, and after filing of the Notice of Objection by the Plaintiff, the Minister re-assessed the said amount in the years 1980 and 1982 and the Plaintiff says the said re-assess- ments were contradictory and inconsistent and the same should be set aside as being contrary to law and to the Charter of Rights and in particular 5.1 and 7 thereof.
The defendant makes the following response in paragraph 13 of the defence:
13. With respect to paragraph 25 of the Statement of Claim, he admits that the Minister of National Revenue issued an assessment for the Plaintiff’s 1981 taxation year on September 16, 1983, inter alia, in respect of amounts received or receivable from Ford Motor Company of Canada arising from the two actions. He admits further that, after the Plaintiff had instituted an appeal to the Tax Court of Canada in respect of its 1981 taxation year, the Minister of National Revenue reassessed the Plaintiff for its 1980 and 1982 taxation year so as to include in the computation of the Plaintiff's income amounts received or receivable from Ford Motor Company of Canada arising from the two actions. He otherwise denies the said paragraph and states further that the assessments were based on information provided by the Plaintiff and the allegations of fact contained in the Plaintiff's Notice of Appeal to the Tax Court of Canada in respect of its 1981 taxation year, that Counsel for the Defendant submitted to the Tax Court of Canada that the Plaintiff's appeal of the assessment of its 1981 taxation year ought to be allowed, and that such appeal was allowed by the Tax Court of Canada by judgment dated February 5, 1987.
The defendant pleads, inter alia, in the assumptions of fact set out in paragraph 14 of the defence that the amounts of $51,182.44 and $27,579.16 were received or receivable by the plaintiff as income in its 1982 taxation year.
Essentially, the crux of the defendant's case on the motion to strike is simply this: the statement of claim in the present action constitutes an abuse of process by reason that the pleading therein regarding the basis of assessment for the defendant's 1981 taxation year contradicts the factual basis of the assessment made and defended by the Minister in the other action with respect to the same amounts said to be income to the plaintiff in the 1982 taxation year.
The defendant primarily relies on Rules 419 and 411 of the Federal Court Rules, which state as follows:
Striking Out Pleadings
419.(1) The Court may at any stage of an action order any pleading or anything in any pleading to be struck out, with or without leave to amend, on the ground that
(a) it discloses no reasonable cause of action or defence, as the case may be, (b) it is immaterial or redundant,
(c) it is scandalous, frivolous or vexatious,
(d) it may prejudice, embarrass or delay the fair trial of the action, (e) it constitutes a departure from a previous pleading, or
(f) it is otherwise an abuse of the process of the Court,
and may order the action to be stayed or dismissed or judgment to be entered accordingly.
(2) No evidence shall be admissible on an application under paragraph (1)(a). (3) In this Rule, "departure" means that which is prohibited by Rule 411.
411.(1) A party shall not in any pleading make any allegation of fact inconsistent with a previous pleading of his or raise any new ground or claim as an alternative to, or a substitute for, a ground or claim in a previous pleading.
(2) Paragraph (1) shall not be taken as prejudicing the right of a party to amend, or apply for leave to amend, his previous pleading so as to plead the allegations or claims in the alternative.
Counsel for the defendant submits that a party may plead in the alternative but not inconsistently. It therefore follows that the Minister cannot be permitted to plead in one case that certain amounts are assessable to the taxpayer's 1981 taxation year, while maintaining at the same time in another case in which he plays the role of defendant that the identical amounts are assessable to the 1982 taxation year. Counsel contends that such contradic- tory pleading places the defendant in the present action in a position of double jeopardy, thereby making it impossible for the defendant to demolish the findings of fact upon which the Minister bases his assessment. Furthermore, it is submitted that such double jeopardy contradicts section 7 of The Canadian Charter of Rights and Freedoms in that it violates the principles of fundamental justice by thrusting on the defendant the unfair onus of having to disprove inconsistent and contradictory assessments. Finally, counsel for the defendant submits that the reassessments for the 1980 and 1982 taxation years had the legal effect of nullifying any previous assessment for the 1981 taxation year, and he cites in support thereof Walkem v. M.N.R.,  C.T.C. 513; 71 D.T.C. 5288 (F.C.T.D.).
Counsel for the plaintiff asserts, on the other hand, that Rule 419 does not avail to the defendant inasmuch that the statement of claim discloses a reasonable cause of action and from the further fact that the defendant has pleaded over to the same. As for Rule 411, the Rule against departure therein enunciated only applies to pleadings in the same action. He maintains that the statement of claim is only pleading allegations of fact in support of a cause of action that is separate and distinct from those pleaded in defence to another action. He argues that this is particularly necessary in a case where, as here, the facts in dispute are within the sole knowledge of the opposite party. While conceding that inconsistent and contradictory assessments are generally undesirable, he argues that the circumstances here are such as to leave the Minister with no other choice, relying on Quemet Corp. v. The Queen,  C.T.C. 414 at 419-20; 79 D.T.C. 5330 at 5334 (F.C.T.D.). Counsel for the plaintiff submits that the defendant in the case has raised factual allegations subsequent to the reassessments for 1980 and 1982 which cast much doubt on the actual date of settlement of the second action, that is, whether occurring in 1981 or 1982. In addition, the defendant has declined to provide waivers to the Minister with respect to its 1981 taxation year. The result therefore is that in order to ensure that the income received from the settlement of the second action is taxed at all, it is absolutely necessary that the appeal involving the 1981 assessment be maintained and permitted to proceed.
I will deal first with the procedural points.
The English rule against departure is similar in wording to our own Rule 411. Odgers’ Principles of Pleading and Practice, 21st ed. gives this explanation of the rule at page 212:
It is at the stage of reply that the rule against what is called "a departure in pleading” applies for the first time. “A party shall not in any pleading make any allegation of fact, or raise any new ground of claim, inconsistent with a previous pleading of his." 1
A departure takes place when in any pleading the party deserts the ground that he took up in his preceding pleading, and resorts to another and a different ground; or, to give Sir Edward Coke's definition, "A departure in pleading is said to be when the second plea containeth matter not pursuant to his former, and which fortifieth not the same; and therefore it is called decessus, because he departeth from his former plea" (Co. Litt. 304a). This is clearly embarrassing; a reply is not the proper place in which to raise new claims; to permit this would tend to spin out the pleadings to an intolerable length. The plaintiff must amend his statement of claim by adding the new matter as a further or alternative allegation.
. . . A departure in pleading exists where a party quits or departs from the case or defence which he has first made, and has recourse to another. This rule against departure only applies to pleadings in the same action.
1 See Ord. 18, r. 10;
Williston and Rolls, The Law of Civil Procedure, has this to say about the comparable Ontario rule, at page 666:
. . . A departure in pleading exists where a party quits or departs from the case or defence which he has first made, and has recourse to another. This rule against departure only applies to pleadings in the same action.
Applying the foregoing principles to the case at bar, I am bound to conclude that Rule 411 is of no assistance to the defendant.
What of the point made regarding inconsistency in pleading? Williston and Rolls, op cit, says at page 664:
Either party may include in his pleading alternative allegations even though they be inconsistent: a plaintiff may plead inconsistent sets of material facts and claim relief thereunder in the alternative, and a defendant may raise in his defence as many inconsistent defences as he may think proper.
In re Morgan; Owen v. Morgan (1887), 35 Ch.D. 492 (C.A.), Lindley, L.J., said at page 499:
I think that in this case the learned judge in the Court has taken too strict a view of the Order as to pleadings. He has evidently proceeded on the principle that inconsistent defences are embarrassing and ought not to be allowed. That view appears to me not to be warranted by the Orders when properly construed.
The learned Judge has relied in particular upon Order XIX., rule 4, the important part of which runs thus: "Every pleading shall contain, and contain only, a statement in a summary form of the material facts on which the party pleading relies for his claim or defence, as the case may be, but not the evidence by which they are to be proved."
Now I cannot myself construe that Order as prohibiting inconsistent pleadings. One sees perfectly well what is meant by it, viz., that each party is to state succinctly and concisely in a summary form the material facts on which he relies. Now a person may rely upon one set of facts, if he can succeed in proving them, and he may rely upon another set of facts, if he can succeed in proving them; and it appears to me to be far too strict a construction of this Order to say that he must make up his mind on which particular line he will put his case, when perhaps he is very much in the dark. . . .
I therefore disagree with the defendant's blanket contention that the plaintiff may not plead in this action allegations of fact inconsistent with those pleaded in another action in which the plaintiff is defendant.
Nonetheless, the defendant still maintains that the present action represents an abuse of process, arguing that the inconsistency of pleading has the effect of placing on the taxpayer the unfair onus of having to reassess its own income. In support of this contention, the defendant cites the following statement of Mr. Justice Rand in Johnston v. M.N.R.,  C.T.C. 195 at 203; 3 D.T.C. 1182 at 1183.
. . . It must, of course, be assumed that the Crown, as is its duty, has fully disclosed to the taxpayer the precise findings of facts and rulings of law which have given rise to the controversy.
Here there are two controversies by way of appeal in which inconsistent allegations of fact are pleaded. I fail to see any nexus between this type of situation where there are different issues to be tried in separate actions and the proposition stated by Rand, J., in Johnston, supra. Moreover, it is my view that the Crown cannot reasonably be expected to disclose precise findings of fact with respect to the actual date of settlement of the second action when these facts are solely within the knowledge of the defendant taxpayer.
The present case, as it seems to me, is not one where the Minister is seeking in the same action to have the court confirm two contradictory assessments in the same taxation year, unlike Crown Trust, infra, which held that this was "no legal bar to the Minister assessing two different amounts for the same asset in the same taxation year when the value to be determined arises out of the same transaction”, despite the unfairness of such practice: see Crown Trust Company v. The Queen,  C.T.C. 320; 77 D.T.C. 5173 (F.C.T.D.), per Addy, J., at page 324 (D.T.C. 5175). Rather, it is more analogous, in my view, to a situation where the Minister had little choice in making inconsistent and seemingly contradictory assessments in separate actions for different taxation years, but arising out of the same transaction, in order to ensure that there will at least be some taxation. See in this regard Quemet Corp. v. The Queen, supra, per Walsh, J., at page 419-20 (D.T.C. 5335). Viewed in this light, the present action seems to me to be one that is necessary to preserve the right to reassess amounts in the 1981 taxation year, where such amounts might otherwise become statute barred by virtue of subsection 152(4) of the Income Tax Act in the absence of any waiver on the part of the taxpayer.
Counsel for the defendant relies on Walkem v. M.N.R.,  C.T.C. 513; 71 D.T.C. 5288 (F.C.T.D.) as authority for the proposition that a reassessment supersedes an assessment under appeal. In that case, the Crown was successful on a motion to quash the taxpayer's appeal from an original reassessment that had been cancelled and superseded by a subsequent reassessment. Counsel argues that the present appeal with respect to the 1981 taxation year is invalid because the original reassessment has been replaced by the reassessments for the 1980 and 1982 taxation years. Counsel for the plaintiff distinguishes the Walkem case as being applicable only to reassessments in a single taxation year and not as between different taxation years in respect of different issues. I agree with this submission. Moreover, it is clear from the statutory language of section 152 of the Act that assessments and reassessments are made for a particular taxation year with a view to determining the amount of income tax payable for that particular year. Each taxation year must be considered independently. Hence, it is difficult, if not impossible, to conceive how a reassessment for one taxation year can be taken to be superseded by a reassessment in respect of another taxation year. Consequently, I find that the Walkem case is of no assistance to the defendant.
I turn now to the defendant's final submission to the effect that the continuance of the present action places the taxpayer in a position of double jeopardy and thus violates the principles of fundamental justice espoused by section 7 of the Canadian Charter of Rights and Freedoms. This is said to arise from the fact that the defendant has been thrust into the invidious position of having to disprove inconsistent and contradictory reassessments. I disagree.
The central issue in the taxpayer's appeal in the other action is whether the reassessments for the taxation years 1980 and 1982 were wrong by reason that amounts added to income for those years were not income but rather capital. The taxpayer pleaded alternatively in the same action that if the said amounts were taken to constitute income to the plaintiff then they were received or receivable in the 1981 taxation year and were not assessable for the 1980 or 1982 taxation years. In the present action, the plaintiff is appealing the Tax Court's decision allowing the defendant's appeal on the basis that its other appeal with respect to similar amounts for different years had been dismissed. In my view, this is entirely consistent with the Minister's position that he wishes only to ensure that the amounts involved do not escape any taxation.
While both actions by way of appeal possess many common features out of the same general set of circumstances, they nevertheless in fact raise the very real and substantially different issue of whether the amounts of $51,182.44 and $27,579.16 were taxable as business income to the plaintiff in either of the 1981 or 1982 taxation years. As I see it, the resolution of this issue turns on whether the taxpayer's second action against Ford was settled in February 1982 or before the end of the 1981 calendar year in terms of when the settlement proceeds were actually received. In my view, the answer to this is a matter within the taxpayer's peculiar knowledge whereby he can hardly be heard to complain of double jeopardy and violation of the principles of fundamental justice if he choses not to reveal the actual date of settlement. Rather than constituting a threat of double jeopardy, I consider that the present action is a necessary safeguard against the possibility of the taxpayer avoiding any taxation by successfully proving in the other action that the amounts were actually received in 1981.
In my opinion, each action has its own raison d'être and individual points of merit requiring a full adjudication at trial. I find therefore that the plaintiff's statement of claim discloses a reasonable cause of action in the circumstances and that it does not constitute an abuse of the process of the court.
In the result, the defendant's motion is dismissed with costs and an order will go accordingly.