Placer Dome Inc. v. The Queen, 91 DTC 5115 (FCTD)

After the taxpayer had carried a non-capital loss for his 1981 taxation year back to 1980, s. 152(4)(b) was amended "applicable after April 19, 1983" to provide that the taxation year to which a loss is carried back may be reassessed within seven years rather than four years of the date of mailing of a notice of assessment. Before the expiration of seven-year period but after April 19, 1983 and the expiration of the four-year period, the Minister reassessed the 1980 taxation year to reduce the amount of the non-capital loss which was deductible in computing taxable income for that year. MacKay J. found that the power to reassess for up to seven years only applied when an application was made, after April 19, 1983, under subsection 152(6) as amended after that date, to carry back a loss, with the result that the Minister was precluded from reassessing the 1980 taxation year beyond the expiration of the four-year period. MacKay noted (p. 5123):

"The defendant's interpretation would imply, for example, that Parliament intended that under the amending statute the Minister's authority to reassess for a period of seven years would permit in 1984, after enactment of the statute, reassessment of the 1975 or 1976 taxation year to which a taxpayer had carried back a loss from 1976 or 1977, the reassessment of which had been closed in 1980 or 1981 under section 152(4) as it then was."

In finding that a 1984 amendment to the Act should not be interpreted so as to give the Minister the ability to reassess a taxation year of the taxpayer which previously had been statute barred, MacKay J. stated (p. 5122):

"The presumption against retrospective application is ignored where the statute is deemed beneficial in its effects, or where it is merely procedural without affecting substantive interest, or where, within comparatively narrow limits it is deemed to be enacted to protect special public interests. The legislation here in question, in my view, fits none of those categories. Rather, if deemed to apply to past events its effects are primarily prejudicial or adverse to the substantive interest of the taxpayer, and the presumption against retrospective application applies."