Fio – Tax Court of Canada confirms that information obtained on discovery cannot be used by CRA to make further reassessments

CRA used insights gained from documents provided to the Justice lawyers on discovery to issue further reassessments of the taxpayer.  D'Arcy J found that this use of the documents breached the rule in Juman v. Soucette, 2008 SCC 8, that "information obtained on discovery ... is subject to the implied undertaking [that] it is not to be used by the other parties, except for the purpose of that litigation."  However, rather than vacating the further reassessments, he ordered that the discovered documents could not be used in connection with the further reassessments (subject to the Crown getting permission, which would only be granted in "exceptional" circumstances), and also awarded $25,000 in costs against the Crown.

He did not discuss whether each further reassessment was a replacement reassessment (in which case it would have vacated the  previous reassessment and the related appeal– see Cameco) or whether it was an additional reassessment (a rare creature).

Neal Armstrong.  Summaries of Fio Corporation v. The Queen, 2014 TCC 58, under ss. 152(4), 241, and 171(1).