Date: 20111215
Docket: A-192-10
Citation:
2011 FCA 354
CORAM: NADON J.A.
TRUDEL J.A.
MAINVILLE J.A.
BETWEEN:
AGATHE
LÉTOURNEAU
Appellant
and
HER MAJESTY THE QUEEN
Respondent
REASONS FOR JUDGMENT
NADON J.A.
[1]
This is an appeal from a judgment dated
April 15, 2010, by Justice Réal Favreau (the
judge) of the Tax Court of Canada, 2010 TCC 203, in which the judge dismissed
the appellant’s appeal from an assessment made by the Minister of National
Revenue (the Minister) under section 227.1 of the Income Tax Act (the
ITA) for the amount of $70,848.41.
[2]
More specifically, the Minister assessed the appellant
for unremitted source deductions by 9034-1751 Québec Inc. (the company). The
judge concluded that the appellant, as the director of the company, had to be
held solidarily liable together with the company for the payment of the source deductions,
including interest and penalties thereon, which the company had to deduct,
withhold and remit to the Receiver General for Canada.
[3]
As the judge pointed out at paragraph 4 of
his reasons, the issue before him principally concerned the date on which the
appellant resigned as director of the company. Before the judge, the appellant
claimed that she became a director on January 4, 1999, and that she
resigned on December 9, 1999. Consequently, she argued that she could not
be held responsible for the company’s debts because the assessment made by the
Minister to collect the sum payable was statute barred, having been made more
than two years after the date she ceased to be a director of the company. The
judge rejected the appellant’s arguments. In so concluding, he accepted the
Minister’s argument that the two-year limitation period provided in
subsection 227.1(4) of the ITA was inapplicable given the appellant’s
misrepresentations.
[4]
The sole issue before the Court is to determine
whether the judge erred in concluding that the appellant had to be held
solidarily liable for the company’s tax debts. For the following reasons, I
conclude that the judge erred and that the appeal should be allowed.
Facts
[5]
A brief summary of the facts will assist in
understanding the appeal. More specifically, in order to properly understand
the judge’s findings of fact and conclusions of law, I consider it important to
describe certain aspects of the evidence filed before the judge and to briefly
summarize the testimonies of the appellant and of Mr. Jean Fontaine (Jean
Fontaine). It should be noted that the following facts, other than the date on
which the appellant resigned as director, are not disputed by the parties.
[6]
The company was incorporated on April 23, 1996,
under Part 1A of the Quebec Companies Act, RSQ, c. C-38. Until it ceased
carrying on its business in April 2002, the company operated six
convenience stores under the Pétroles Sonerco banner. One
of these convenience stores was located in St-Hyacinthe, Quebec, and operated under the name Accommodation Grandmaître.
[7]
On February 1, 2002, the company filed a
notice of intention to make a proposal. The proposal was not acted upon.
[8]
On March 5, 2002, the Minister assessed the
company for unremitted source deductions for the year 2002, in the amount of
$824.65. On March 6, 2002, the Minister issued a second assessment for the
company for unremitted source deductions for the year 2001, in the amount of
$70,023.76.
[9]
The company assigned its assets on
April 18, 2002, and was officially struck off by the Registraire
des entreprises du Québec, Quebec’s enterprise registrar, on
May 7, 2004.
[10]
On May 4, 2006, the Minister assessed the
appellant for $70,848.41 under section 227.1 of the ITA.
[11]
According to the company’s register of
directors, the appellant was a director from January 4, 1999, to
December 9, 1999. As of that date, the sole director on the register is
Jean Fontaine, gas pump attendant and manager at the St-Hyacinthe convenience
store. He was responsible for managing the employees of the convenience store
and for purchasing gas and various supplies. I note that Jean Fontaine was also
a director from April 23, 1996, to December 2, 1996, and from
May 12, 1997, to January 4, 1999.
[12]
The position held by Jean Fontaine at the
St-Hyacinthe convenience store had been offered to him by Marcel Létourneau, the appellant’s spouse, whom Jean Fontaine trusted implicitly,
according to the judge. Jean Fontaine followed Marcel Létourneau’s advice to
the letter. In fact, Jean Fontaine testified that he never refused to sign
documents that Marcel Létourneau asked him to sign even
though he did not always know enough to understand the nature and consequences
of the documents.
[13]
In his capacity as company director, Jean
Fontaine signed several documents, including corporate resolutions; an application
to open an account for the company at the Bourg-Joli Caisse
populaire in St-Hyacinthe dated January 24, 2000,
according to which he was one of the company’s cheque signing officers (the
second being Ms. Guylaine Lemay, the company’s
comptroller); an application to open an account and become a corporate member
for the company; and a resolution and declaration regarding the administration
of a corporation. In addition, Jean Fontaine signed many cheques, including
several payable to Marcel Létourneau, dated March and April 2001, and the
annual information returns by a corporation for the years 1998, 2000 and 2001. These
returns were filed with the Registraire des entreprises du Québec (“CIDREQ”). I note that on February 23, 2000, the company’s
annual return for 1999 was filed with CIDREQ, naming Jean Fontaine as its
director, president and secretary. The truth of the information provided in
this return was certified by Jacques Matte, the company’s authorized counsel. Lastly,
it was Jean Fontaine who signed, in his capacity as director, the assignment of
the company’s assets on April 18, 2002.
[14]
Jean Fontaine’s testimony reveals that, in fact,
he had no knowledge of the company’s operations during his time as director. Moreover,
he recognized that he had never reviewed the company’s books or the A-1 share
certificates that he signed on April 23, 1996, in his capacity as
secretary and president of the company.
[15]
Regarding the appellant’s testimony, he revealed
the following. The appellant married Marcel Létourneau
in 1966. She acknowledged that she was the company’s director from January 4,
1999, to December 9, 1999, that is, until the day on which she tendered
her resignation. By a shareholder resolution, the company accepted her
resignation and appointed Jean Fontaine as director on December 9, 1999,
an office that he accepted on the very same day.
[16]
According to the company’s register of
shareholders, the appellant held 100 Class “A” shares in the company from
January 4, 1999, to January 3, 2001. She allegedly acquired these
shares from Jean Fontaine on January 4, 1999, and then reassigned them to
him on January 3, 2001.
[17]
The appellant also testified that she had been a
shareholder of Gestion Aghmana Inc., which owned a
commercial building in Rouyn-Noranda and in which the company
operated a convenience store. Moreover, the appellant’s testimony allegedly
revealed that, following the company’s bankruptcy, the appellant signed and
filed a proof of claim with the company’s bankruptcy trustee on May 6,
2002, regarding a $158,000 loan extended to the company by Gestion Aghmana Inc.
[18]
In addition, the appellant testified that during
her period as director of the company, she was not involved in the day-to-day
management of the company’s operations, since this was the responsibility of
Guylaine Lemay who, among other things, took care of the bookkeeping and
accounting in Victoriaville, home to Marcel Létourneau’s offices.
[19]
As of December 9, 1999, the date on which
the appellant submits having resigned as director, she was not in any way
authorized to sign company cheques or bank resolutions. Moreover, she was never
present at the Victoriaville office where the company was administered and
where the books were kept. In short, the appellant in no way participated in
the company’s administration, and she performed no duties of administration as
of December 9, 1999.
Minister’s Reply
to the Notice of Appeal
[20]
At paragraph 10 of his Reply to the Notice
of Appeal, the Minister assumed a number of facts, including the following:
[translation]
(b) The appellant was a director of 9034 starting on January 4,
1999.
. . .
(j) 9034’s register of directors was falsified in such a way as to
make it appear as though the appellant had resigned from her directorship on
December 9, 1999.
(k) In reality, the appellant was a director until at least as
recently as January 3, 2002.
Decision of
the Tax Court of Canada
[21]
The judge concluded that the appellant had to be
held solidarily liable together with the company for the payment of the unremitted
source deductions the company owed. Before explaining the judge’s reasons, I
reproduce the provisions of the ITA that are at the heart of the dispute before
us:
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152. (4) The
Minister may at any time make an assessment, reassessment or additional
assessment of tax for a taxation year, interest or penalties, if any, payable
under this Part by a taxpayer or notify in writing any person by whom a
return of income for a taxation year has been filed that no tax is payable
for the year, except that an assessment, reassessment or additional
assessment may be made after the taxpayer’s normal reassessment period in
respect of the year only if
(a) the taxpayer or person filing the
return
(i) has made any misrepresentation that
is attributable to neglect, carelessness or wilful default or has committed
any fraud in filing the return or in supplying any information under this
Act, or
227. (10) The
Minister may at any time assess any amount payable under
(a)
subsection 227(8), 227(8.1), 227(8.2), 227.(8.3) or 227(8.4) or 224(4) or
224(4.1) or section 227.1 or 235 by a person,
(b)
subsection 237.1(7.4) by a person or partnership,
(c)
subsection 227(10.2) by a person as a consequence of a failure of a
non-resident person to deduct or withhold any amount, or
(d) Part
XIII by a person resident in Canada.
And, where the Minister sends a notice of
assessment by that person or partnership, Divisions I and J of Part 1 apply
with any modifications that the circumstances require.
227.1 (1)
Where a corporation has failed to deduct or withhold an amount as required by
subsection 135(3) or 135.1(7) or section 153 or 215, has failed to remit such
an amount or has failed to pay an amount of tax for a taxation year as
required under Part VII or VIII, the directors of the corporation at the time
the corporation was required to deduct, withhold, remit or pay the amount are
jointly and severally, or solidarily, liable, together with the corporation,
to pay that amount and any interest or penalties relating to it.
227.1 (4)
No action or proceedings to recover any amount payable by a director of a
corporation under subsection 227.1(1) shall be commenced more than two years
after the director last ceased to be a director of that corporation.
|
152. (4) Le ministre peut établir une cotisation, une nouvelle cotisation
ou une cotisation supplémentaire concernant l’impôt pour une année d’imposition,
ainsi que les intérêts ou les pénalités, qui sont payables par un
contribuable en vertu de la présente partie ou donner avis par écrit qu’aucun
impôt n’est payable pour l’année à toute personne qui a produit une
déclaration de revenu pour une année d’imposition. Pareille cotisation ne
peut être établie après l’expiration de la période normale de nouvelle
cotisation applicable au contribuable pour l’année que dans les cas suivants
:
a) le contribuable ou
la personne produisant la déclaration :
(i) soit a fait une
présentation erronée des faits, par négligence, inattention ou omission
volontaire, ou a commis quelque fraude en produisant la déclaration ou en
fournissant quelque renseignement sous le régime de la présente loi,
227. (10) Le ministre peut en tout temps, établir une cotisation pour les
montants suivants :
a) un montant payable par une personne en vertu des paragraphes (8),
(8.1), (8.2), (8.3) ou (8.4) ou 224(4) ou (4.1) ou des articles 227.1 ou
235 ;
b) un montant payable par une personne ou une société de personnes
en vertu du paragraphe 237.1(7.4) ;
c) un montant payable par une personne en vertu du paragraphe (10.2)
pour défaut par une personne non-résidente d’effectuer une déduction ou une
retenue ;
d) un montant payable en vertu de la partie XIII par une personne
qui réside au Canada.
Les sections I et J
de la partie 1 s’appliquent, avec les modifications nécessaires, à tout avis
de cotisation que le ministre envoie à la personne ou à la société de
personnes.
227.1 (1) Lorsqu’une corporation a omis de déduire ou de retenir une somme,
tel que prévu au paragraphe 135(3) ou à l’article 153 ou 215, ou a omis de
remettre cette somme ou a omis de payer un montant d’impôt en vertu de la
Partie VII ou de la Partie VIII pour une année d’imposition, les
administrateurs de la corporation, à la date à laquelle la corporation était
tenue de déduire, de retenir, de verser ou de payer la somme, sont
solidairement responsables, avec la corporation, du paiement de cette somme,
incluant tous les intérêts et toutes les pénalités s’y rapportant.
227.1 (4) L’action ou les procédures visant le recouvrement d’une somme
payable par un administrateur d’une corporation en vertu du paragraphe (1)
sont prescrites après deux ans de la date à laquelle l’administrateur cesse
pour la dernière fois d’être un administrateur de cette corporation.
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[22]
First, the judge summarized the facts disclosed
by the evidence, particularly those disclosed by the testimonies of the
appellant and of Jean Fontaine. Second, the judge examined the relevant
statutory provisions, specifically subsections 227(10), 227.1(1) and
227.1(4) of the ITA, leading him to observe that even though the Minister was
under no time limit to assess an amount payable by a person under section 227.1
of the ITA, no action or proceedings to recover any amount assessed could be
commenced “more than two years after the director last ceased to be a director
of that corporation” under subsection 227.1(4).
[23]
In light of these provisions, the judge
indicated that the date that the appellant last ceased to be a director of the
company had to be determined. On the basis of his analysis of the evidence, the
judge concluded that the appellant remained a director of the company until
May 7, 2004, the date on which the company was officially struck off the
enterprise register. According to the judge, the register of directors was
falsified regarding the appellant’s resignation as company director. More
specifically, the judge was of the opinion that unexplained corrections had
been made to the register of directors to substitute the date of
January 3, 2002, with that of December 9, 1999. Because of this
falsification, the appellant’s true date of resignation from her directorship
was unknown, and her letter of resignation could not be recognized as valid and
effective. These findings led the judge to conclude the following at
paragraph 31 of his reasons:
[31] Since the evidence does not reveal that the appellant resigned
from her position as director, went bankrupt, was unable to perform her duties,
or availed herself of protective supervision, or that the company was
liquidated before its registration was struck off, the appellant must be deemed
never to have lost her status as director until the company was struck off the
register.
[24]
After concluding that the appellant remained
director of the company until May 7, 2004, the
judge examined the appellant’s argument based on subsection 227.1(4) of
the ITA and according to which the Minister’s remedy was statute barred since
the Minister’s assessment of the appellant, dated May 4, 2006, was made after the two-year limitation period provided for in
subsection 227.1(4). The judge rejected
this argument at paragraph 21 of his reasons since the Minister’s
assessment, dated May 7, 2006, was made less than two years after the
company was officially struck off the register of enterprises, that is, on
May 7, 2004, and was therefore not statute barred.
[25]
Notwithstanding the judge’s
analysis of this question, at paragraphs 39 and 40 of his reasons, the
judge seemed to assume that the Minister’s remedy was statute barred unless it
was possible to rely on subsection 152(4) of the ITA. At paragraphs 21 and 39 of his
reasons he wrote as follows:
[21] The reassessment against the appellant is dated May 4, 2006.
That is more than two years after the appellant ceased, for the last time, to
be a shareholder of 9034-1751 Québec Inc., whether that date was December 9, 1999, or January
3, 2002. It is also more than two years after the CRA first consulted the
original minute book of 9034-1751 Québec Inc. on January 24, 2004, and more than two years after
9034-1751 Québec Inc. made an assignment of its property on
April 18, 2002. However, it is within the two-year period that began on
the date that Quebec’s Registraire
des entreprises cancelled 9034-1751 Québec Inc.’s
registration, because that cancellation took place on May 7, 2004.
. . .
[39] The assessment against the appellant was made beyond the
normal reassessment period. Subsection 227(10) of the ITA authorizes the
Minister to assess a person for an amount contemplated by section 227.1 of the
ITA at any time, in which case Divisions I and J of Part I of the ITA apply to
the assessment. Those divisions encompass subsection 152(4), which restricts
the Minister’s power to reassess beyond the regular reassessment period to the
situations contemplated in paragraphs (a) and (b) of that
subsection. The situation contemplated in subparagraph 152(4)(a)(i) is
one where the taxpayer or person filing the return has made a misrepresentation
that is attributable to neglect, carelessness or wilful default or has
committed any fraud in filing the return or in supplying any information under
the ITA.
[26]
The judge was of the opinion, as appears from
paragraph 39 of his reasons, that subsection 227(10) in fine provided
that the Minister could at any time assess any amount payable by a person under
section 227.1 and, where the Minister sent a notice of assessment to that
person, divisions I and J of Part I of the ITA applied with any
modifications that the circumstances required. In addition, the judge found
that subsection 152(4) of the ITA stipulated that the Minister could make
an assessment or reassessment after the taxpayer’s normal reassessment period
when the taxpayer in question had “made a misrepresentation that is
attributable to neglect, carelessness or wilful default or [had] committed any
fraud in filing the return or in supplying any information under the ITA”. In
other words, according to the judge, the two-year limitation period became
inapplicable when the taxpayer’s conduct matched that described in
subparagraph 152.4(a)(i).
[27]
At paragraph 40 of his reasons, the judge
indicated that the Minister had the burden of demonstrating that he was
entitled to assess the appellant beyond the normal reassessment period and
stated that he was satisfied that the Minister had met his burden of proof. Specifically,
the judge wrote that since the register of directors was improperly altered and
these alterations had prevented the Minister from making a reassessment during
the normal period contemplated by the ITA and since the appellant had been aware
of these alterations, the Minister’s recovery proceedings were not subject to the
two-year limitation period. Consequently, according to the judge, the appellant
had to be held solidarily liable for the company’s debts.
[28]
For these reasons, the judge dismissed the
appellant’s appeal from the Minister’s assessment with costs.
Analysis
[29]
As indicated at paragraph 4 of my reasons,
it is my view that the judge erred in concluding that the appellant had to be
held solidarily liable for the company’s tax debts. The judge made a palpable
and overriding error in concluding that the appellant had never resigned as
director. In so concluding, he failed to consider ample evidence that supported
the appellant’s argument and gave too much weight to certain aspects of the
evidence, including the fact that Jean Fontaine acted on behalf of Marcel
Létourneau. Consequently, this Court can intervene (see Housen v. Nikolaisen,
[2002] 2 S.C.R. 235).
[30]
As a result of this error, the judge wrongly
concluded that the appellant knew of the falsification of her actual date of
resignation as director in the register of the directors. Since the evidence
reveals that the appellant resigned on December 9,1999, she cannot be held
liable for the company’s tax debt for unremitted source deductions for 2001 and
2002.
[31]
The cornerstone of the judge’s reasons is the
fact that a correction was made to the register of directors regarding the
appellant’s resignation date, by which the date of January 3, 2002, was
substituted with that of December 9, 1999. According to the judge, since
the appellant had not filed any evidence to enlighten the Court as to the
falsification of the register of directors or the reasons therefor, and since,
in his opinion, the appellant alone could benefit from it, the register was
consequently altered “with the appellant’s full knowledge” (paragraph 33
of the judge’s reasons). According to the judge, the purpose of the appellant’s
actions was to limit her liability for the company’s debt for 2001 and 2002.
[32]
Another factor leading the judge to his conclusion
was his finding that the appellant was not credible and that her testimony
lacked detail. At paragraph 37 of his reasons, the judge stated the following:
[37] . . . Among other things, she had no
recollection, or merely vague recollections, of the $158,000 loan advanced by
Gestion Aghmana Inc., of Ms. Lambert’s mortgage on her Florida condominium, of
the reasons for her resignation as a director of 9034-1751 Québec Inc., or
of that company’s fake wage payments to Ms. Lambert to repay her personal
mortgage debt.
[33]
Lastly, the judge concluded, at
paragraph 38 of his reasons, that Jean Fontaine “was merely used as a
proxy for the appellant’s spouse”. The judge had the following to say:
[38] . . . The evidence is that he signed the
documents that Marcel Létourneau placed before him. In actual fact, Jean
Fontaine was never a director of 9034-1751 Québec Inc. and never did any
accounting or bookkeeping. The administration of 9034-1751 Québec Inc. was
done from Victoriaville, not from Saint‑Hyacinthe. In addition, Mr. Fontaine had no knowledge of the
business of the other five convenience stores managed by 9034-1751 Québec
Inc., with the exception of the information obtained during the yearly rounds
of the stores with Marcel Létourneau. His claim that he could become the owner
of a convenience store by virtue of his overtime is not realistic and cannot be
accepted. No price for the store, and no terms and conditions of acquisition,
were agreed upon with Marcel Létourneau. The purchases and sales of the shares
in 9034-1751 Québec Inc. were done with no regard for their actual value.
Indeed, Mr. Fontaine’s memory faltered when it came to explaining why the
shares of 9034-1751 Québec Inc. were transferred so often and why EI [employment
insurance] source deductions were made from the salary that 9034-1751 Québec
Inc. paid him in 2002, when he was a shareholder of the company and was
therefore not entitled to EI.
[34]
In my opinion, the evidence does not support the
judge’s conclusion that the appellant never resigned as director. There is no
question that Jean Fontaine was appointed director on December 9, 1999, to
replace the appellant and that he held that position until the company was dissolved
on May 7, 2004. Following the appellant’s resignation letter dated
December 9, 1999, Jean Fontaine was appointed director by a shareholders’
resolution, and he accepted that position on the same day. On January 24,
2000, he opened the company’s bank account at the Bourg-Joli Caisse populaire,
and only he and Guylaine Lemay were authorized to sign cheques. He also signed
the account application forms and the banking resolution as well as all of the
company’s cheques during 2000 and 2001. In fact, Jean Fontaine was the only
person who acted on behalf of the company during the period starting on
December 9, 1999, and ending the day on which the company was dissolved on
May 7, 2004, which explains why Jean Fontaine, in his capacity as
director, signed the assignment of the company’s assets on April 18, 2002.
[35]
Jean Fontaine’s testimony was in no way
challenged by the judge. On the contrary, it was because of his testimony that
the judge concluded that Jean Fontaine was merely acting as a proxy for Marcel
Létourneau. The judge implicitly recognized that the company’s de jure
director was Jean Fontaine and that he was acting under the control of the de
facto director, Marcel Létourneau.
[36]
Another factor supporting the appellant’s
position that she resigned on December 9, 1999, is the company’s annual
return for 1999 filed with CIDREQ on February 23, 2000, which names Jean
Fontaine as its new director. This document fully corroborates the testimonies
of Jean Fontaine and of the appellant, according to which the appellant resigned
on December 9, 1999, and was replaced by Jean Fontaine the very same day.
[37]
The evidence also clearly revealed that the
appellant did nothing as director of the company from December 9, 1999,
onwards. The judge recognized this fact at paragraph 34 of his reasons.
[38]
In my opinion, the evidence could lead to only
one conclusion, namely, that the appellant stopped being a director of the
company on December 9, 1999. Why did the judge conclude that the appellant
never resigned as a director? At paragraphs 30, 31 and 32, above, I
explained the judge’s reasoning. One of the factors he considered was the fact
that Jean Fontaine was merely used as a proxy for Marcel Létourneau. In my
opinion, this factor is irrelevant with respect to the appellant’s resignation
date. Marcel Létourneau’s control over Jean Fontaine could not, in itself, lead
to the conclusion that the appellant never resigned. At best, this fact could
have led to the conclusion that Marcel Létourneau was the company’s de facto
director during the period Jean Fontaine performed his duties as director.
[39]
Another factor the judge took into account to
conclude as he did is the falsification of the register of directors, which, in
his opinion, was attributable to the appellant, who was seeking to limit her
liability for the company’s debt for 2001 and 2002. This resulted entirely from
his conclusion that the appellant had never actually resigned as director. Since,
in my opinion, as I have just explained, the evidence is clear that the
appellant ceased to be a director on December 9, 1999, when she was replaced
by Jean Fontaine, it follows that the appellant had no interest in altering the
register of directors. Since all the bank and corporate documents as of
December 9, 1999, namely, the cheques, annual returns and documents concerning
the opening of the account at the Bourg-Joli Caisse populaire, publicly
disclose that Jean Fontaine was the director during those years, it seems
impossible to conclude, with respect, that the entry in the register of
directors that the appellant resigned on December 9, 1999, is fraudulent. The
entry in the register of directors merely confirms the actual situation,
namely, that Jean Fontaine became director on December 9, 1999, replacing
the appellant.
[40]
Consequently, in my view, by concluding that the
correction made to the register of directors was fraudulent, the judge failed
to consider important evidence, including the documentary evidence, that
corroborated the testimonies of the appellant and of Jean Fontaine according to
which there was a change in director on December 9, 1999.
[41]
Another factor the judge took into account to
conclude that the appellant never resigned as director was her lack of
credibility. However, even though the appellant was not credible regarding, for
example, the $158,000 loan extended to the company by Gestion Aghmana Inc.
Ms. Lambert’s mortgage and the reasons for her resignation as director of
the company, the fact remains that the documentary evidence and testimony amply
demonstrate that the appellant was no longer director as of December 9, 1999.
[42]
Thus, as a result of my conclusion that the
appellant did resign on December 9, 1999, and that she was therefore not a
director in 2001 and 2002, she cannot be held liable for the company’s tax debt
for source deductions the company failed to deduct, withhold and remit to the
Receiver General for Canada in 2001 and 2002.
[43]
Before the judge and before this Court, the
parties assumed that the Minister’s assessment of the appellant dated
May 4, 2006, was a “[proceeding] to recover any amount payable by a director
of a corporation” within the meaning of subsection 227.1(4) of the ITA. While
I entertain doubt as to the merit of this premise, it is not necessary for this
Court, given the conclusion I have reached, to determine whether the Minister’s
assessment was such a proceeding within the meaning of subsection 227.1(4). In
any event, as the appellant resigned as director on December 9, 1999, the
Minister’s “action or proceedings” to recover the company’s tax debt are
statute barred since they were commenced more than two years after the
appellant last ceased to be a director of the company.
[44]
Finally, we do not need to determine whether, by
operation of section 227.10 in fine, subsection 152(4) applies
in the present matter.
Decision
[45]
For these reasons, I would allow the appeal with
costs, set aside the judgment of the Tax Court of Canada and, rendering the
judgment that ought to have been rendered, I would allow the appellant’s appeal
of the Minister’s assessment with costs and refer the matter back to the Minister
for reassessment on the basis that the appellant resigned as director of the company
on December 9, 1999.
“M. Nadon”
“I agree.
Johanne Trudel J.A.”
“I agree.
Robert M. Mainville”
Certified true translation
Johanna Kratz, Translator
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