Docket: 2010-309(IT)G
BETWEEN:
DAVID FREE,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
____________________________________________________________________
Motion
heard on August 24, 2010, at Toronto, Ontario
By: The Honourable
Justice C.H. McArthur
Appearances:
|
Counsel for the Appellant:
|
Daniel
R. Lyons
|
|
Counsel for the Respondent:
|
Khashayar Haghgouyan
|
____________________________________________________________________
ORDER
UPON motion by the Respondent for an Order that the
Appellant deliver particulars within a specified time pursuant to
section 52 of the Tax Court of Canada Rules (General Procedure) and
for an extension of time within which to file and serve a Reply to the Notice
of Appeal;
UPON
reading the materials filed and hearing counsel for the parties;
IT IS ORDERED THAT the motion is granted as follows:
1. The Appellant will provide the
Respondent with a particulars including a breakdown of the amount of income,
inclusions and deductions used by him to calculate the amount of income
reported in his tax returns for the 2005 and 2006 taxation years by November
12, 2010;
2. The Respondent shall file and
serve a Reply to the Notice of Appeal by January 12, 2011; and
3. The Respondent is entitled to costs
in the amount of $350, inclusive of H.S.T., payable forthwith.
Signed at Ottawa, Canada,
this 13th day of October, 2010.
“C.H. McArthur”
Citation: 2010 TCC 509
Date: 20101012
Docket: 2010-309(IT)G
BETWEEN:
DAVID FREE,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR ORDER
McArthur J.
[1]
This motion brought by
the Respondent is for an Order requiring the Appellant to deliver particulars
within a specified time pursuant to section 52 of the Tax Court of
Canada Rules (General Procedure), and for an extension of time within which
to file and serve a Reply to the Notice of Appeal to 60 days after an Order is
made in respect of this motion.
[2]
The grounds for the
motion are:
(a) the Appellant has failed to satisfy the
Respondent’s Demand for Particulars served on the Appellant on May 28, 2010;
and
(b) the Notice of Appeal as filed does not
provide sufficient particulars to which the Respondent may reply in its
pleadings.
[3]
The affidavit of
Samantha Hurst, co-counsel on behalf of the Respondent, includes the following
in paragraph 5:
5. I verily believe that the Respondent is
unable to plead intelligently in its Reply because the allegations of fact
contained in the Notice of Appeal under “Material Facts Relied Upon” are not
sufficiently explicit to determine the exact nature of the questions to be
tried. More specifically:
a) While paragraphs 26 and 28 of the Notice
of Appeal contain general assertions on which the Appellant relies in support
of his legal position, these statements are not supported by any of the facts
alleged in paragraphs 7 to 23 of the Notice of Appeal; and
b) By failing to provide the Respondent with
a breakdown of the amount of income, inclusions and deductions used by the
Appellant to calculate the amount of “income reported in his tax returns as
filed” (paragraph 26 of the Notice of Appeal) and the disallowed “net business
losses” (paragraph 28 of the Notice of Appeal) for the relevant years the
Appellant has undermined the Respondent’s ability to address in an intelligent
manner the central question of the deductibility of the expenses incurred by
the Appellant
[4]
Paragraphs 26 and 28 of
the Appellant’s Notice of Appeal state:
26. The Appellant’s income in each year of the
Assessed Period was the income reported in his tax returns as filed for the
Assessed Years.
...
28. Because of this erroneous assumption, the
Minister erred in disallowing net business losses of $67,338 in 2005 and
$61,353 in 2006.
[5]
The motion is brought
pursuant to section 52 of the Rules which reads:
52. Where a party demands particulars of an
allegation in the pleading of an opposite party, and the opposite party fails
to supply them within thirty days, the court may order particulars to be
delivered within a specified time.
[6]
The Appellant’s counsel
states that the primary issue in the appeal is whether the Appellant was an
independent contractor or an employee of the Municipality of Meaford in 2005 and 2006. The Appellant’s counsel stated that the
Minister can simply deny paragraph 28 of the Notice of Appeal and that
there is no need to put the Appellant to the expense of identifying the nature
and amounts of the expenditures at this time.
[7]
It appears that the
Appellant’s objection to this motion is that the cost associated with providing
the Respondent with the information required is unnecessary at this time,
particularly when it will be provided during discovery. Counsel repeated this
three of four times.
[8]
The Minister’s counsel stated
that the appeals deal with the deductibility of expenses and a competent Reply to
the Notice of Appeal cannot be made without having a breakdown of the claimed
expenses in the total amounts of $67,338 in 2005 and $61,353 in 2006.
[9]
I agree with the
Respondent that the facts referred to in paragraphs 7 to 23 of the Notice of
Appeal are of little assistance in determining the specifics of the Appellant’s
position. The purpose of the Notice of Appeal and Reply is to clearly disclose
the facts upon which both parties are relying. The Appellant admits that the breakdown
of the expenses claimed will have to be provided during discovery, leaving me
at a loss as to why it was not provided now.
[10]
Therefore, the motion
is granted, with costs. The Appellant shall provide the Respondent with a
breakdown of the amount of income, inclusions and deductions used by the
Appellant to calculate the amount of “income reported in his tax returns as
filed” (paragraph 26 of the Notice of Appeal) and the disallowed “net business
losses” (paragraph 28 of the Notice of Appeal) for the relevant years by
November 12, 2010.
[11]
The Respondent is
entitled to costs in the amount of $350, inclusive of H.S.T., payable
forthwith, and the Respondent shall file and serve a Reply to the Notice of
Appeal by January 12, 2011.
Signed at Ottawa, Canada, this 13th day of October 2010.
“C.H. McArthur”
CITATION: 2010 TCC 509
COURT FILE NO.: 2010-309(IT)G
STYLE OF CAUSE: DAVID FREE and
HER
MAJESTY THE QUEEN
PLACE OF HEARING: Toronto,
Ontario
DATE OF HEARING: August 24, 2010
REASONS FOR ORDER
BY: The Honourable Justice C.H. McArthur
DATE OF ORDER: October 13, 2010
APPEARANCES:
|
Counsel for the
Appellant:
|
Daniel R. Lyons
|
|
Counsel for the
Respondent:
|
Khashayar Haghgouyan
|
COUNSEL OF RECORD:
For the Applicant:
Name: Daniel R. Lyons
Firm: Payne
Law
For the
Respondent: Myles J. Kirvan
Deputy
Attorney General of Canada
Ottawa,
Canada
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