Docket: 2012-631(IT)I
BETWEEN:
WILLIAM A. LAWRENCE,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
____________________________________________________________________
Motion
heard on June 8, 2012 at Halifax, Nova Scotia
Before: The Honourable
Justice Valerie Miller
Appearances:
|
For the Appellant:
|
The
Appellant himself
|
|
Counsel for the Respondent:
|
Gregory B. King
|
____________________________________________________________________
ORDER
Upon consideration of a
motion by the Respondent for an Order quashing the Appellant’s Notice of Appeal
from the Notice of Determination dated November 10, 2011 on the grounds that
the Appellant did not have standing to file a Notice of Objection;
And upon hearing the representations of
counsel for the Respondent;
And upon hearing representations of the
Appellant;
The motion is granted and the purported
appeal is quashed.
Signed at Ottawa, Canada, this 20th day of September 2012.
“V.A. Miller”
Citation : 2012TCC331
Date: 20120920
Docket: 2012-631(IT)I
BETWEEN:
WILLIAM A. LAWRENCE,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR ORDER
V.A. Miller J.
[1]
The Respondent has
brought a motion for an Order to quash this appeal on the basis that the
Appellant did not file a valid notice of objection.
[2]
At the beginning of the
hearing of this appeal, I allowed the Respondent to file an Amended Reply to
the Notice of Appeal. However, my decision in this motion was not based on the
amended reply.
[3]
The question raised by
the motion is whether the Appellant has standing to file a notice of objection
for tax years prior to his assignment in bankruptcy?
[4]
I have concluded that
the Appellant does not have standing and that the motion to quash the appeal is
granted.
[5]
The facts are short and
straightforward.
[6]
The Appellant filed an
assignment into bankruptcy on November 16, 2006. He was discharged from
bankruptcy on June 27, 2008.
[7]
By letter dated July 7,
2011, the Appellant asked the Minister of National Revenue (the “Minister”) to
determinate whether he was eligible to claim the Disability Tax Credit (“DTC”)
for 2010 and prior years.
[8]
By notice dated
November 10, 2011, the Minister determined that the Appellant was eligible for
the DTC for the 2001 to 2016 taxation years. The Minister adjusted the Appellant’s
income tax returns for the post-bankruptcy years (2006 to 2010) and issued
reassessments for those years. The Minister informed the Appellant that a
request for a reassessment of his 2006 (pre-bankruptcy) and prior years could
only be made by the trustee.
[9]
The Appellant filed a
notice of objection dated November 28, 2011 for the 2006 (pre-bankruptcy) to
2001 taxation years. He was informed by letter dated December 21, 2011 that his
notice of objection could not be accepted. The Appellant has appealed.
Analysis and Decision
[10]
Section 71 of the Bankruptcy
and Insolvency Act (BIA) reads as follows:
Vesting
of property in trustee
71. On a bankruptcy order being made or an
assignment being filed with an official receiver, a bankrupt ceases to have any
capacity to dispose of or otherwise deal with their property, which shall,
subject to this Act and to the rights of secured creditors, immediately pass to
and vest in the trustee named in the bankruptcy order or assignment, and in any
case of change of trustee the property shall pass from trustee to trustee
without any assignment or transfer.
[11]
The definition of property
in the BIA is extremely wide and includes the right to bring an action.
It reads:
“property” means any type of property, whether situated in Canada or elsewhere,
and includes money, goods, things in action, land and every description of
property, whether real or personal, legal or equitable, as well as
obligations, easements and every description of estate, interest and profit,
present or future, vested or contingent, in, arising out of or incident to
property;
[12]
The taxation years at
issue in this motion were prior to the Appellant’s assignment into bankruptcy
and all rights of action (the “Rights”) passed to and vested in the trustee on
the date of bankruptcy in accordance with section 71 of the BIA. (Biron
v. R., 2002 D.T.C. 6958 (FCA)) On bankruptcy, the Appellant ceased to have
the legal capacity to file a notice of objection concerning his 2001 to 2006
(pre-bankruptcy) taxation years.
[13]
When the Appellant was
discharged from bankruptcy on June 27, 2008, these Rights did not automatically
revert to him. In MLA Northern Contracting Ltd. v. LeBrun (2007), 39 C.B.R.
(5th) 95 (S.C.J.), affirmed 2008 ONCA 339, T.A. Plantana J. made
the following observations:
65 A discharged bankrupt has no right
or entitlement to deal with his or her prior assets. The discharge of the
Trustee and of the bankrupt does not have the automatic effect of reverting
proprietary rights to the bankrupt. As noted in Solomon,
"once property is vested in the trustee, it does not revert back to the
bankrupt on discharge."25 There is no question that the claimed interest in question
existed prior to the bankruptcy and that it was not claimed as part of the
bankruptcy. I agree with the position that regardless of whether this was
disclosed or not, LeBrun's Claimed MLA Interests passed to, and vested with,
the Trustee on the date of bankruptcy and there is no automatic reversion of
that asset back to LeBrun.
[14]
In the present case,
there was no evidence that the trustee had been discharged in this matter.
[15]
Likewise, there was no
evidence that the Appellant had applied to have the Rights reassigned to him.
(See Moffoot v. E. Sands & Associates Inc., 2011 BCSC 1167).
[16]
I conclude that the
Appellant did not have standing to file a notice of objection and his Notice of
Appeal is quashed.
Signed at Ottawa, Canada, this 20th day of September 2012.
“V.A. Miller”
CITATION: 2012TCC331
COURT FILE NO.: 2012-631(IT)I
STYLE OF CAUSE: WILLIAM A. LAWRENCE AND
THE
QUEEN
PLACE OF HEARING: Halifax, Nova Scotia
DATE OF HEARING: June 8, 2012
REASONS FOR ORDER
BY: The Honourable Justice Valerie Miller
DATE OF ORDER: September 20, 2012
APPEARANCES:
|
For the
Appellant:
|
The Appellant himself
|
|
Counsel for the
Respondent:
|
Gregory B. King
|
COUNSEL OF RECORD:
For the Appellant:
Name:
Firm:
For the
Respondent: Myles J. Kirvan
Deputy
Attorney General of Canada
Ottawa,
Canada
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