Citation: 2010 TCC 141
Date: 20100308
Docket: 97-3628(IT)G
BETWEEN:
ALLAN MCLARTY,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR TAXATION
Barbara Tanasychuk, T.O., T.C.C.
[1] This taxation came on for hearing by way of a
telephone conference call on October 15, 2009. It follows a Judgment of the
Honourable Justice L.M. Little dated January 26, 2005, wherein appeals from
assessments made under the Income Tax Act for the 1992 and 1994 taxation
years were allowed, with costs. The Appellant was represented by Mr. Jehad
Haymour and Ms. Wendy Burnham represented the Respondent.
[2] For use at this hearing, the
Appellant filed Affidavits of Elaine Hutchinson, sworn April 2nd,
2009 (“the Appellant’s first Affidavit”) and October 14th, 2009 (“the
Appellant’s second Affidavit”). The Respondent filed an Affidavit of Deborah Horowitz,
affirmed October 9th, 2009 (“the Respondent’s Affidavit”).
[3] Ms. Burnham stated that there was no
dispute with respect to the counsel fees claimed in the amount of $26,175.00.
As agreed, the amount of $26,175.00 for counsel fees is allowed.
[4] Ms. Burnham further stated that the
following disbursements were not disputed:
|
Filing fee
|
$250.00
|
|
Witness fees and
expenses (7 witnesses, 11 days @ $50/day)
|
$350.00
|
|
Expert witnesses (2
witnesses, 3 days @ $350/day)
|
$1,050.00
|
|
PPR filing fees and search
|
$60.00
|
|
Research materials –
CAPP Statistical Handbook
|
$150.00
|
|
External photocopies
|
$1,433.47
|
As agreed, the amount of $3,293.47 (plus GST) for
disbursements is allowed.
[5] The following disbursements are in dispute:
|
Consultant Services
Fees
|
$13,475.50
|
|
Expert witness fees
|
$15,450.00
|
|
Court reporter for
examinations for discovery and trial transcripts
|
$16,024.00
|
|
Fax and courier
delivery
|
$2,102.90
|
|
Postage
|
$190.42
|
|
Long distance charges
|
$464.38
|
|
Photocopies
|
$13,467.35
|
|
Travel and
accommodation
|
$17,173.64
|
|
Meals
|
$548.07
|
|
Taxi charges
|
$633.40
|
|
Parking
|
$75.60
|
APPELLANT’S SUBMISSIONS
[6] Mr. Haymour provided a brief history of the
file. The Notice of Appeal was filed in 1997 and related to assessments for the
1992 and 1994 taxation years. The Appellant was one of several investors who entered
into a joint venture, which joint venture subsequently purchased an interest in
a seismic database. The Appellant’s List of Documents contained in excess of six
hundred documents, examinations for discovery were held over eight days with
one hundred and thirty-three undertakings given. The Appellant filed an expert
report and two rebuttal reports. The hearing of the appeal took place over
fourteen days in September, 2003 and the decision of the Tax Court of Canada
was ultimately affirmed by the Supreme Court of Canada in June, 2008.
[7] Mr. Haymour further stated that Mr. McLarty’s
appeal was a test case, in that the other investors in the joint venture were
ultimately re-assessed on the basis of the decision in Mr. McLarty’s appeal.
CONSULTANT SERVICES FEES
[8] The Appellant seeks to recover the amount of
$13,475.50 for consultant services fees. The fees represent amounts paid to six
consultants who testified at trial, as follows:
|
Brian Curts of Curts
Seismic Consultants Ltd.
|
$937.50
|
|
Carl Ringdahl
|
$3,000.00
|
|
Christopher Talbot
|
$4,000.00
|
|
Ted Webb of Citadel
Engineering Ltd.
|
$3,338.00
|
|
Ray Jaskela of Jaskela
Resource Consulting Ltd.
|
$400.00
|
|
George Fairs of 746757
Alberta Ltd.
|
$1,800.00
|
[9] Mr. Haymour stated that it was necessary to
retain these consultants to review their prior work and prepare to testify at the
hearing. Without the assistance of the consultants, it would have been
impossible to properly prepare the Appellant’s case.
EXPERT WITNESS FEES
[10] Mr. Haymour stated that the Appellant was
entitled to recover the amount of $15,450.00, representing fees paid for the
services of an expert witness, Wade Brillon of Divestco.com. Mr. Brillon’s
expert and rebuttal reports were filed with the Court and Mr. Brillon testified
at trial. Mr. Haymour stated that following Ms. Burnham’s cross-examination of
Mr. Brillon as to his qualifications, counsel for the Appellant withdrew the
request to have him qualified as an expert on valuation. Although the witness was
withdrawn as an expert in valuation, Mr. Brillon’s expert reports were not
restricted to the issue of valuation. It is the Appellant’s position that,
notwithstanding the fact that Mr. Brillon did not testify as to valuation, he
did give expert testimony and the fees paid to him are recoverable. He further
stated Mr. Brillon’s fees were reasonable and were incurred for the purpose of
advancing the Appellant’s position.
COURT REPORTER FEES
[11] The Appellant’s claim for court reporter fees in
the amount of $16,024.00 included court reporter fees for examinations for
discovery, transcripts thereof and transcripts of the hearing which were
prepared on an expedited basis. Mr. Haymour stated that the trial transcripts
were required to assist counsel in preparing for final argument.
FAX AND COURIER DELIVERY, POSTAGE AND LONG DISTANCE
CHARGES
[12] The amounts claimed for fax and courier delivery
charges are $2,102.90, postage $190.42 and long distance charges of $464.38.
Mr. Haymour stated that any costs associated with the Respondent’s Rule 58
motion and reporting to the client were not included in these amounts. To
support the amounts claimed, copies of his firm’s internal accounting records
were attached as Exhibits “G”, “H” and “I” to the Appellant’s first Affidavit.
Mr. Haymour stated that the expenses incurred were reasonable and essential for
the conduct of the litigation.
PHOTOCOPIES
[13] The Appellant’s claim for the cost of
photocopies in the amount of $13,467.35 represented the cost of photocopies made
in the offices of counsel for the Appellant. Mr. Haymour stated that the cost
of photocopies related to the Respondent’s motion under Rule 58 were excluded
from the amount claimed, as well as copies related to reports to the client.
The amount claimed was supported by copies of his firm’s internal accounting
records, Exhibit “J” to the Appellant’s first Affidavit.
TRAVEL AND ACCOMMODATION
[14] Mr. Haymour stated that considerable travel and
accommodation expenses were incurred by counsel. Mr. Carman R. McNary was
co-counsel for the Appellant and his office was in Edmonton, Alberta, while Mr. Haymour’s office was in Calgary, Alberta. The claim for reimbursement of expenses
incurred by Mr. McNary included the cost of flights from Edmonton to Calgary for meetings, trial preparation, conduct of the
hearing and one trip to Ottawa for the purpose of settlement
discussions. In addition, two trips were made to Ottawa by Mr. Haymour for settlement discussions with counsel for the
Respondent. Receipts to support the amounts claimed were attached as Exhibit “L”
to the Appellant’s first Affidavit. Mr. Haymour stated that the expenses
incurred were both reasonable and essential for the conduct of the litigation.
MEALS, TAXI CHARGES AND PARKING
[15] Mr. Haymour stated that the claim for meals,
taxi charges and parking totalling $1,257.07 related to expenses incurred by counsel
during their trips to Ottawa, during the trial and during Mr. McNary’s various
trips to Calgary. Mr. Haymour stated that the expenses
were reasonable and necessary for the conduct of the litigation.
RESPONDENT’S SUBMISSIONS
[16] Ms. Burnham stated that Mr. McLarty’s appeal was
not a test case. She submitted that while there were a number of taxpayers
involved in the joint venture, there was no formal agreement between the
parties that other taxpayers would be bound by the results of Mr. McLarty’s
appeal.
[17] Ms. Burnham also stated that the materials
produced to support the disbursements claimed were not presented in an
organized manner, which made it difficult to determine what the documents
related to and whether the amounts claimed were justified.
CONSULTANT SERVICES FEES
[18] Ms. Burnham stated that three of the
consultants, Brian Curts, Ray Jaskela and Ted Webb were hired in 1992 to prepare
valuations of the seismic data. They were retained to establish the value of
the seismic data, to justify the deduction of Cumulative Canadian Exploration
Expenses.
[19] Ms. Burnham stated that Carl Ringdahl was an
employee of Compton Resource Corporation. Compton Resource Corporation was the
corporation which was responsible for the gathering of investors to join it in
the purchase of the seismic database.
[20] Ms. Burnham stated that Christopher Talbot and
George Fairs were involved with finding the seismic database and testified
about their involvement in that process.
[21] Ms. Burnham’s position was that there was no
provision for the allowance of fees paid to consultants. Ms. Burnham stated
that these consultants were fact witnesses and the allowable amount for a fee
paid to a fact witness was $50.00 per day.
[22] In addition, Ms. Burnham stated that subsection
4(2) of Tariff A of Schedule II of the Tax Court of Canada Rules (General
Procedure) permits the payment to a witness in excess of $50.00 per day.
However, once such a payment is made, the party
must advise the Court. To her knowledge, this was not done.
EXPERT WITNESS FEES
[23] Ms. Burnham stated that the Appellant’s expert,
Wade Brillon, was hired to prepare a valuation of the seismic data. Ms.
Burnham stated that following her cross-examination of Mr. Brillon as to his
qualifications, counsel for the Appellant withdrew Mr. Brillon as an expert on valuation.
As a result, Mr. Brillon’s testimony was restricted to a very small portion of
what was contained within his report. Ms. Burnham further stated that because
Mr. Brillon was withdrawn as an expert on valuation, the amount claimed for his
services should be reduced to zero.
[24] In the alternative, Ms. Burnham stated that
because Mr. Brillon’s testimony was restricted to a small and insignificant
issue, the $15,450.00 claimed for Mr. Brillon’s services should be reduced by
at least seventy-five percent, to reflect the value of his evidence to the
Court.
[25] In the further alternative, Ms. Burnham stated
that the most that should be allowed for Mr. Brillon’s services was $300.00 per
day. Despite the fact that there were no time sheets produced for Mr. Brillon,
Ms. Burnham suggested that he be allowed fees for one day in Court, ten days
consulting and an additional six days all at $300.00 per day, for a total of
$5,100.00.
COURT REPORTER FEES
[26] Ms. Burnham stated that approximately $14,000.00
of the $16,024.00 claimed for transcripts related to the cost of expedited
transcripts of the trial proceedings. Ms. Burnham stated that the Appellant had
three lawyers in attendance at the hearing and that the expedited transcripts
were not necessary. It was her position that the Appellant should only be
allowed $1,800.00, representing fees paid to the court reporter for the
examinations for discovery.
FAX AND COURIER DELIVERY, POSTAGE AND LONG DISTANCE
CHARGES
[27] Ms. Burnham stated that the only documents
produced to support the amount claimed for faxes consisted of printouts of long
lists of internal accounting records from Mr. Haymour’s law firm. The printouts
did not contain any indication of what the charges were for, how they related
to the proceedings and the reasons for the expenses.
[28] In reviewing the printouts for courier expenses,
Ms. Burnham stated that some of the expenses claimed were incurred after the
conclusion of the hearing, prior to the filing of the Notice of Appeal and others
related to the hearing of the Rule 58 motion.
[29] Ms. Burnham’s submissions regarding the amount
claimed for long distance and postage charges were similar to her comments
regarding the amounts claimed for faxes and couriers. Insofar as the long
distance charges were concerned, the documentation offered no explanation as to
who was called, how the calls related to the trial of this action and the
printouts included post trial charges. The printouts of charges for postage
offered no details as to what was mailed and why.
PHOTOCOPIES
[30] Ms. Burnham stated that the $13,467.35 claimed
for photocopies
was unreasonable. In addition, there was no proof
provided that all of the copies were necessary for the conduct of the appeal.
[31] Ms. Burnham referred to paragraphs 11(b) and (c)
of the Appellant’s second Affidavit, wherein it was stated that all costs for
copies related to the Rule 58 application and client reporting were excluded.
In addition, paragraph 11(d) of the Appellant’s second Affidavit stated that
the cost for photocopying was adjusted to the rate of twenty cents per page.
However, Ms. Burnham stated that when she totalled the amounts set out on the
internal accounting records at Exhibit “J” to the Appellant’s first Affidavit,
the total came to $13,467.35, which is the amount claimed on the Bill of Costs.
[32] Ms. Burnham stated that a more reasonable amount
for photocopies was $4,660.00. That figure was contained on an earlier version
of the Appellant’s Bill of Costs, Exhibit “B” to the Respondent’s Affidavit,
wherein the documents copied, the number of copies made and the amount charged per
page were identified.
TRAVEL AND ACCOMMODATION
[33] Ms. Burnham stated that the travel costs
associated with the trips to Ottawa by Messrs.
Haymour and McNary to discuss settlement were not allowable amounts and should
be excluded from the $17,173.64 claimed. Included in the receipts attached as
Exhibit “L” to the Appellant’s first Affidavit was an airfare receipt for a
return trip to Ottawa made by Mr. John Brussa in the amount of
$3,183.25. Ms. Burnham stated that the Appellant was not entitled to
reimbursement for the cost of this trip. Mr. Brussa was a lawyer who developed the plan that was used for the purchase of the
seismic data and was not counsel for the Appellant.
MEALS
[34] Ms. Burnham stated that paragraph 18 of the
Appellant’s first Affidavit indicated that the claim for $548.07 represented
the cost of meals for counsel during their trips to Ottawa and during the trial. Ms. Burnham stated that while there are some
receipts for meals, most of the documents attached as Exhibit “M” to the
Appellant’s first Affidavit are internal accounting records from Mr. Haymour’s
firm. Ms. Burnham stated that some of the receipts related to expenses incurred
prior to trial and one record indicated that the expense was incurred after the
trial. Ms. Burnham’s position was that the documents provided to support the
claim were so deficient, it was impossible to determine what expenses should be
allowed.
TAXI CHARGES
[35] Ms. Burnham stated that while paragraph 19 of
the Appellant’s first Affidavit stated that the $633.40 claimed for taxis
related to charges incurred during the trips by counsel to Ottawa and Calgary,
the documents produced at Exhibit “N” included claims for taxis taken at other
times. Included with the documentation were printouts of internal accounting
records with no actual receipts to support the amount claimed. As such, Ms.
Burnham stated that the entire amount claimed for taxis should be disallowed.
PARKING
[36] Ms. Burnham stated that paragraph 20 of the
Appellant’s first Affidavit indicated that the $75.60 claimed for parking represented
parking charges incurred as a result of attending settlement meetings in Ottawa
and travelling to Calgary. However, she noted that a $42.00 receipt included with the materials at Exhibit
“O” to the Appellant’s first Affidavit was for a charge incurred for two days
of parking at the Calgary airport at the same time that the Federal Court of
Appeal heard the appeal of the decision on the Rule 58 motion in Edmonton, Alberta.
POST-JUDGMENT INTEREST
[37] With respect to the post-judgment interest
claimed, Ms. Burnham stated that any award of post-judgment interest should run
from May 22, 2008, which is the date on which the Supreme Court of Canada
issued its decision upholding the Judgment of the Tax Court of Canada.
DECISION
[38] The manner in which the receipts and invoices submitted
to support the disbursements claimed did not lend much assistance to me. I was
faced with a mass of paper, with very little explanation as to what it
represented. After hearing submissions of counsel and reviewing the materials
submitted, my decision follows.
CONSULTANT SERVICES FEES
[39] The details of the $13,475.50 claimed for the
services of six consultants who testified at the hearing are set out in
paragraph 8 above. Copies of their invoices are marked as Exhibit “B” to the
Appellant’s first Affidavit.
[40] A review of the Court file disclosed that these
six consultants testified as fact witnesses at trial. The Appellant has claimed
$50.00 for each of these six witnesses and counsel for the Respondent has
consented to the $300.00 claimed.
[41] Mr. Haymour referred to the decision of the Nova
Scotia Court of Appeal in D.W. Matheson & Sons Contracting Ltd. v.
Canada (Attorney General), 2000 NSCA 44, [2000] N.S.J. No. 96. In
that case, the plaintiff was seeking to recover fees paid to two engineers that
were called to testify as fact witnesses. It was determined that the Court had
the discretion to make an allowance for fees paid to fact witnesses and
referred the matter back to the trial judge to determine whether that
discretion should be exercised in the plaintiff’s favour.
[42] The Court’s discretion is much broader than that
of a Taxing Officer. I do not have the discretion to allow the fees paid to the
six consultants who appeared as fact witnesses. I will tax off the amount of
$13,475.50 claimed for consultant services fees.
EXPERT WITNESS FEES
[43] Mr. Brillon’s expert witness report was filed and
he testified at trial. After Mr. Brillon was called to the witness box and
following Ms. Burnham’s cross-examination as to his qualifications, counsel
chose to withdraw Mr. Brillon as an expert qualified to testify as to the value
of the seismic database.
[44] I do not accept Ms. Burnham’s suggestion that
the allowable amount for Mr. Brillon’s services should be reduced to zero. Nor
do I accept her alternate arguments. While Mr. Brillon did not give expert
testimony as to all of the matters dealt with in his report, the decision to
withdraw Mr. Brillon as an expert on valuation was made by counsel once the trial
was in progress. It is well established law that fees paid to expert witnesses
who are not called to testify are recoverable on a party and party taxation. I
am satisfied that the fees paid to Mr. Brillon are reasonable and I will allow
the full amount of the claim in the amount of $15,450.00 (plus GST).
COURT REPORTER FEES
[45] The Appellant’s claim for $16,024.00 is
comprised of $1,798.95 for the examinations for discovery and $14,225.05 for
transcripts of the hearing, which were produced on an expedited basis. In the
decision of RMM Canadian Enterprises Inc. and Equilease Corporation v. Her
Majesty the Queen, 97 DTC 420, former Chief Justice Bowman of
this Court disallowed the cost of the transcript of the cross-examination of
two witnesses and stated:
To have these transcripts available
may have been helpful but I do not regard them as essential.
[46] I have no doubt that the expedited transcripts
were of assistance to counsel in preparing for final argument, but I am not
convinced that this was an essential disbursement, the cost of which is
recoverable on a party and party taxation of costs. I will accordingly tax off
the amount of $14,225.05 and allow the amount of $1,798.95 (plus GST) for court
reporter fees.
FAX AND COURIER DELIVERY
[47] The claim
for $2,102.90 for fax and courier charges were supported by the documents at
Exhibit “G” to the Appellant’s first Affidavit, which consisted of Fraser Milner Casgrain (“FMC”) cost recap summaries and disbursement lists. Those
documents listed charges incurred for sending materials via fax and courier.
[48] I do not
question the necessity to send documents via fax and delivery by courier, but I
have no idea what was sent, why and to whom. In the absence of such
information, I will not allow the full amount claimed. I will allow fifty
percent of the amount claimed for a total of $1,051.45 (plus GST).
POSTAGE
[49] The materials produced to support the $190.42
claimed for postage are attached as Exhibit “H” to the Appellant’s first
Affidavit. Those documents are copies of FMC’s internal accounting records
consisting of cost recap summaries and disbursement lists. From my review of
the cost recap summaries produced, it appears that $190.42 is the amount FMC
billed the Appellant for postage. The disbursement detail lists contain entries
totalling $219.42 for postage. The two page disbursement detail lists appear to
cover the period March 25, 1999 to March 28, 2007 and the handwritten note
“excluded” appears next to four figures which total $73.36.
[50] It would be illogical to disallow the entire
amount claimed for postage, but the documentation produced to support the claim
is so deficient it is tempting to do so. I will allow the amount of $117.06
(plus GST) for postage. This figure represents the amount claimed of $190.42
less $73.36, which is the total of the amounts on the disbursement detail list
on which the note “excluded” has been made.
LONG DISTANCE CHARGES
[51] Counsel for the Appellant and Respondent were
not only in different cities, but different provinces. There is no doubt that
long distance charges were incurred. While Ms. Burnham stated that some of the
charges on the records were for calls placed prior to the filing of the Notice
of Appeal and after the hearing, my review of the disbursement lists attached
as Exhibit “I” to the Appellant’s first Affidavit disclosed that not all of the
items on the lists were included in the $464.38. I will allow the sum of
$464.38 (plus GST) for long distance charges as I am satisfied that this is a
reasonable amount for long distance charges and a necessary expense for the
conduct of the appeal.
PHOTOCOPIES
[52] The Appellant has claimed $13,467.35 for
photocopies. The documentation produced to support this claim consisted of
close to 100 sheets of internal accounting records from FMC found at Exhibit “J”
to the Appellant’s first Affidavit. Those records appeared to be a listing of all
of the photocopies made, some of which were charged at twenty-five cents per
page and others at thirty cents per page. The records provided no explanation
as to what was photocopied and why.
[53] From my review of Exhibit “J” to the Appellant’s
first Affidavit, it appears that the Appellant is seeking to recover the cost
of each and every photocopy made. Due to the lack of detail contained within
the supporting documents produced, I am not prepared to allow the full amount
claimed for photocopies. An earlier version of the Appellant’s Bill of Costs,
Exhibit “B” to the Respondent’s Affidavit, included a claim of $4,660.00 for
photocopies, together with a breakdown of what was copied, the number of copies
made, all at twenty cents per page. In the absence of detailed information to
substantiate the $13,467.35 claimed, I will allow the amount of $4,660.00 (plus
GST) for photocopies.
TRAVEL AND ACCOMMODATION
[54] The hearing of this appeal took place in Calgary, Alberta. The Appellant was represented by Messrs. McNary,
Haymour and Kwan, all of FMC. Mr. McNary worked from the Edmonton office of FMC, while Messrs. Haymour and Kwan
worked from FMC’s Calgary office.
[55] The appellant has claimed $17,173.64 for travel
expenses. A portion of that amount related to expenses incurred by Mr. McNary for
his travel to Calgary for various meetings and the hearing
before Justice Little. Additional expenses for travel and accommodation were
incurred by Messrs. McNary and Haymour in travelling to Ottawa for settlement discussions with counsel for the
Respondent.
[56] A substantial amount of paper was produced at
Exhibit “L” to the Appellant’s first Affidavit to support the amount claimed
for travel and accommodation. The documents produced to support the claim for
travel and accommodation expenses do not total $17,173.64. In addition, there
was no breakdown provided as to who travelled, where, when and why. Intermingled
within the materials were handwritten expense claims, taxi receipts and
restaurant receipts. It was very difficult to determine what, if any of the
amounts of these various receipts were included in the $17,173.64, in that
meals and taxis were claimed as separate items on the Bill of Costs.
[57] Also included with the documents at Exhibit “L”
was an invoice in the amount of $3,183.25 for a return trip to Ottawa made by Mr. John Brussa on May 16, 2001. It was not
clear to me whether the cost of this trip was actually included in the
$17,173.64 claimed. In any event, counsel for the Appellant admitted that this
was not a recoverable expense and the claim for it was withdrawn.
[58] While Ms. Burnham stated that the Respondent
should not be responsible for Mr. McNary’s travel costs, I disagree. In the
case of Ross v. Canada, 2007 TCC 208, [2007] T.C.J. No. 155, the Taxing
Officer allowed the expenses incurred by counsel based in Montreal for travel
to Toronto for discoveries and the hearing of the appeal.
[59] I will allow the cost of Mr. McNary’s air travel
to and from Edmonton to Calgary for the hearing of the appeal. The
Appellant was entitled to hire counsel of his choice and that choice should not
be restricted by the venue for the hearing of his appeal. According to my
review of the receipts produced, the cost of Mr. McNary’s airfare for travel to
and from Calgary for the hearing was $1,357.24 (plus
GST), which amount is allowed.
[60] The invoice in the amount of $3,503.79 for Mr.
McNary’s hotel accommodations during the trial covered the period September 5,
2003 to September 25, 2003. Based on the receipts for airfare, it appears that
Mr. McNary returned to Edmonton each weekend, but maintained his hotel
room over each weekend for a total of twenty-one nights. The hotel invoice also
included charges for laundry, parking, telephone calls and room service. Of the
total amount of the invoice for accommodations during the trial, I will allow
accommodation for seventeen nights at $129.00 per night for a total of $2,193.00
(plus GST).
[61] Mr. Haymour made two trips to Ottawa on March 27, 2000 and May 16, 2001 to discuss
settlement with counsel for the Respondent. Ms. Burnham suggested that the
costs associated with these trips were not recoverable expenses, in that the
meetings were held at the request of counsel for the Appellant. I do not agree.
Settlement of litigation, without the necessity of proceeding to trial is
always preferable. The travel costs associated with the settlement meetings are
minimal when compared to the costs associated with the ultimate appeal of this
Court’s decision to the Supreme Court of Canada.
[62] Mr. Haymour’s trips to Ottawa were made in what is now known as “executive class”. The receipt for Mr.
Haymour’s first trip contained a handwritten note “1/2 of invoice – $1,619.55”.
The total cost of the airfare was $3,238.89 which included $211.89 for GST and
an airport improvement fee of $20.00. Based on the handwritten note, I have
assumed that fifty percent of the cost of this flight was included in the
$17,173.64. The invoice for the airfare for the second trip on May 16, 2001 was
in the amount of $3,429.35, which included GST of $224.35 and an airport
improvement fee of $20.00.
[63] I will allow the airfare for Mr. Haymour’s two
trips to Ottawa, but at a reduced rate. While executive
class travel affords travellers a great deal of comfort, it is an extravagance,
the cost of which is not justified for domestic travel and recoverable on a
party and party taxation. I was unable to find historical data to determine
what the cost of these trips in a lower class of fare would have been at the
time these trips were made. However, current full fares are approximately one
half of executive class fares, which is what I will allow, as follows:
March 27, 2000 Trip – $771.75, plus GST, which includes the
$20.00 airport improvement fee
In view of the handwritten note on the invoice
referred to in paragraph 62 above, the amount allowed represents twenty-five
percent of the total amount of the airfare
May 16, 2001 Trip – $1,612.50, plus GST, which includes
the $20.00 airport improvement fee
[64] I will also allow the cost of a hotel room for
two nights. The first invoice from the Château Laurier indicated that the room
rate was $219.00 and included a handwritten note “1/2 charged”. I have assumed
that fifty percent of the cost of the hotel accommodation was included in the total
amount claimed. I will allow $114.98 for the hotel room in Ottawa in March, 2000 and $177.45 for the hotel room in Ottawa in May, 2001, for a total of $292.43 (plus GST).
[65] Mr. McNary accompanied Mr. Haymour to Ottawa for the second meeting with counsel for the
Respondent in May, 2001. As co-counsel for the Appellant, I will allow the
costs associated with his trip. Mr. McNary travelled in first class and I will reduce
the airfare by fifty percent. The quality of the invoice produced to support
this claim was poor and as best as I can determine, the airfare was $2,977.00, and
I will allow $1,488.50, (plus GST).
[66] I will also allow the cost of Mr. McNary’s hotel
room for his trip to Ottawa in May, 2001 at $177.45 (plus GST).
[67] It appeared that Mr. McNary made trips to Calgary on May 14, 2001, May 28, 2003 and August 28, 2003 as
receipts for airfare, two nights of accommodation and taxis were included with
the materials at Exhibit “L” to the Appellant’s first Affidavit. Based on my
review of the receipts, I am not aware of the purpose of Mr. McNary’s trips on
May 14, 2001 and May 28, 2003 and I will not allow the costs associated with
those two trips.
[68] I will allow the costs associated with Mr.
McNary’s trip to Calgary in August, 2003, as I am satisfied that
this was a necessary trip made for the purpose of trial preparation. The
amounts allowed are $354.58 for airfare, $135.45 for accommodation for one
night for a total of $490.03 (plus GST).
[69] To summarize paragraphs 54 to 68, the total
amount allowed for travel and accommodation is $8,382.90 (plus GST).
MEALS
[70] I have
disregarded the receipts produced at Exhibit “M” to support the $548.07 claimed
for meals. Assuming that the claim for meals had been submitted using the rates
established by the Treasury Board of Canada Secretariat, the allowable amount
for meals would have been substantially higher. I will allow the amount of
$548.07 (plus GST) for meals.
TAXI CHARGES
[71] The claim
for taxis in the amount of $633.40 was supported by Exhibit “N” to the
Appellant’s first Affidavit, being internal accounting records of FMC, with no
actual receipts produced. Having reviewed the documents, I will allow $316.70
(plus GST), being one half of the total amount claimed. Taxi expenses were
incurred by Mr. McNary while in Calgary and approximately one half of the amount claimed
related to expenses incurred by him during the relevant time period.
PARKING
[72] I will
allow $40.76 (plus GST) for parking. Having reviewed the receipts produced at
Exhibit “O” to the Appellant’s first Affidavit, I have determined that $40.76
related to charges for parking incurred during the hearing and at the time of
the March, 2000 settlement meeting with counsel for the Respondent in Ottawa.
POST-JUDGMENT INTEREST
[73] The Bill of Costs contained a claim for interest
on the costs. Ms. Burnham submitted that any award of interest on the costs
awarded should run from the date of the Judgment of the Supreme Court of
Canada. Mr. Haymour stated that interest on costs should run from the date of
the Judgment of the Tax Court of Canada and that there should be no adjustment
made. Neither party made reference to any jurisprudence with respect to the
award of interest on the costs.
[74] Notwithstanding the fact that the only dispute
with respect to interest on the costs is the date from which interest starts to
run, I do not believe that I have the authority to award interest on costs. Neither
the Tax Court of Canada Act nor the Rules contain provisions for
the allowance on interest on an award of costs. As a result, I will not allow
any amount for interest on costs.
[75] The Bill of Costs of the Appellant is taxed. The
amounts agreed to for fees are $26,175.00 and $3,293.47 (plus GST) for disbursements.
Having allowed the further amount of $32,830.27 (plus GST) for disbursements, the
total amount allowed is $64,827.40. A Certificate in that amount will be
issued.
Signed at Toronto, Ontario, this 8th day of March 2010.
“B.G. Tanasychuk”
Email this Content