Date: 20031124
Docket: A-209-03
Citation: 2003 FCA 446
CORAM: STRAYER J.A.
NOËL J.A.
EVANS J.A.
BETWEEN:
DAVID D. HAGGART
Applicant
and
HER MAJESTY THE QUEEN
Respondent
Heard at Vancouver, British Columbia on November 24, 2003.
Judgment delivered from the Bench at Vancouver, British Columbia, on November 24, 2003.
REASONS FOR JUDGMENT OF THE COURT BY: EVANS J.A.
Date: 20031124
Docket: A-209-03
Citation: 2003 FCA 446
CORAM: STRAYER J.A.
NOËL J.A.
EVANS J.A.
BETWEEN:
DAVID D. HAGGART
Applicant
and
HER MAJESTY THE QUEEN
Respondent
REASONS FOR JUDGMENT OF THE COURT
(Delivered from the Bench at Vancouver, British Columbia on November 24, 2003)
EVANS J.A.
[1] We are all of the opinion that this application for judicial review must be dismissed. The Tax Court Judge made no reviewable error in concluding that the Applicant is not entitled to claim an input tax credit for the G.S.T. paid on the legal services supplied to enable the Applicant and his company to obtain damages from a bank for wrongfully calling in a loan to the company, thereby forcing it out of business: Haggart v. The Queen, 2003 TCC 185.
[2] Although the Applicant restarted his business as a sole proprietorship, he has not established a connection, direct or indirect, between the purchase of the legal services and any ongoing supply of taxable services. Hence, the legal services were not purchased "in the course of commercial activities" of the Applicant for the purpose of subsection 169(1) of the Excise Tax Act, R.S.C. 1985, c. E-15, and, if subsection 140.01(2) applies, the services were not purchased "for the purpose of making taxable supplies in the course of that endeavour".
[3] This conclusion is further supported by the fact that, in upholding the award of damages made to the Applicant at trial, the Alberta Court of Appeal stated that the damages were more accurately characterized as compensation for the total destruction of the business, rather than for loss of profit: Haggart Construction Ltd. v. Canadian Imperial Bank of Commerce, 1999 ABCA 180 at para. 5.
[4] It is also clear that the basis of the award made by the Alberta courts was the tort committed by the bank in 1989 when it wrongfully called in the loan to the company. The subsequent ongoing loss of business income suffered by Mr. Haggart and/or his company was simply the measure of the damages flowing from the 1989 tort.
[5] For these reasons the application will be dismissed with costs.
(Sgd.) "John Maxwell Evans"
J.A.
FEDERAL COURT OF APPEAL
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: A-209-03
STYLE OF CAUSE: David Daniel Haggart v. Her Majesty the Queen
PLACE OF HEARING: Vancouver, B.C.
DATE OF HEARING: November 24, 2003
REASONS FOR JUDGMENT OF THE COURT: Strayer, JA Noël, JA Evans, JA
DELIVERED FROM THE BENCH BY: Evans, JA
APPEARANCES:
|
Christine Hung
|
FOR THE APPLICANT
|
|
Michael Taylor
Patricia A. Babcock
|
FOR THE RESPONDENT
|
SOLICITORS OF RECORD:
|
Christine Hung
Vancouver, B.C.
|
FOR THE APPLICANT
|
|
Morris Rosenberg
Deputy Attorney General of Canada
|
FOR THE RESPONDENT
|
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