Citation: 2007TCC472
Date: 20071010
Docket: 2004-2266(GST)G
BETWEEN:
ÉDOUARD ROBERTSON,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH TRANSLATION]
REASONS FOR ORDER
Tardif J.
[1] The Respondent has brought a motion in this Court for
an Order under section 53 and paragraph 58(1)(b) of the Tax
Court of Canada Rules (General Procedure) ("the Rules")
striking out paragraphs 66, 66A, 66B, 66C, 66D, 66E, 66F, 66G, 66H, 66I,
66J and 67 of the Amended Notice of Appeal dated November 3, 2004,
and paragraphs 34, 35, 36 et 38 of the Appellant's answer dated February 3, 2005.
[2] The motion was heard in Jonquière on May 10, 2007.
[3] The Respondent asks that the Court strike
out the allegations that the Montagnais du Lac Saint-Jean have an
aboriginal right to self-government. According to the Respondent, these
allegations cannot be considered because they are inconsistent with the Constitution
Act, 1982, and are worded in an overbroad fashion. In addition, the
Respondent is concerned about how long the trial will last if these allegations
are not struck out.
[4] The Appellant submits that sufficient particulars have
been given with respect to the allegations concerning the issue of the
aboriginal right to self‑government. Further, he submits that they are in
no way abusive or vexatious, since the Government of Canada acknowledges that
self-government is an aboriginal right under the Constitution Act, 1982 (section 35).
[5] The paragraphs that the Respondent seeks to have
struck out pertain to the following issues:
Amended Notice of Appeal dated November 3, 2004
·
The inherent right of aboriginal
peoples to self-government as an aboriginal right (paragraphs 66 and 66A);
·
The organization of the
Montagnais society of Lac Saint‑Jean prior to the arrival of
Europeans in North America (paragraphs 66B and 66C);
·
The scope of the right
to self-government of the Montagnais du Lac Saint-Jean (paragraphs 66D, 66E,
66F, 66G, 66H and 66I);
·
The application of the
GST and the position of the Montagnais regarding the obligation imposed on
Indian merchants to act as agents in collecting the GST (paragraphs 66J and 67);
Answer
dated February 3, 2005
·
The recognition of
aboriginal government structures within Canada (paragraph 34);
·
The existence of a sovereign
and self‑governing Montagnais entity at the time of contact with the
Europeans, and the retention of the power to impose duties on commercial
transactions or barter (paragraphs 35 and 36);
·
The fact that the Excise
Tax Act has not extinguished the Montagnais' aboriginal right to fiscal
self-government (paragraph 38).
[6] The Appellant submits that there is nothing
scandalous, frivolous or vexatious about the allegations of self-government set
out in the Amended Notice of Appeal. He submits that the allegations are
detailed, and supported by an expert report that has already been served on the
Respondent.
[7] Moreover, in response to the Respondent's concerns
about how long the trial will last if the allegations are not struck out, the
Appellant submits that it is hardly appropriate for the Respondent to make any
comments in this regard, considering that more than a year and a half elapsed
between the time that the written pleadings closed and the time that the motion
to strike out the pleadings was brought, and that the Court could even consider
dismissing the application based on section 8 of the Rules.
[8] The Respondent made
very interesting arguments in support of her motion. The arguments were
supported by case law.
[9] Based on the
evidence adduced, the allegations referred to in the motion are indeed of a
breadth and generality that are likely to result in a protracted trial.
[10] Is this a sufficient reason to strike out or exclude the
allegations? In my view, it should be specified from the outset that the judge
who will try this matter on the merits will be the sole arbiter of the
admissibility of evidence. That judge will have the power to refuse any attempt
to bring in evidence or facts that are not relevant to the point in issue. He
will have the power, generally, not only to direct the argument, but also to intervene
in order to keep the parties focussed on the true issues.
[11] In addition, the
limits of the Court's jurisdiction will also need to be taken into account when
the merits are argued. Indeed, the Court will ultimately have to rule on
whether the assessment under appeal is well‑founded. Any other issue will
need to be excluded from argument.
[12] This motion is not
about a circumscribed fact whose relevance needs to be assessed; it is about a
set of allegations the sole purpose of which is to show that the Appellant was
not subject to the statutory provisions on which the assessment is based.
[13] In other words, they are elements
that will be part of the Appellant's overall theory.
[14] In my view, this motion
cannot succeed on a mere balance of probabilities standard. The relief, the striking
out of the pleadings, could have portentous consequences for the opposing party
at the hearing on the merits, and in view of the issue, this is a case in which
truly decisive evidence would have to be adduced for the relief to be granted.
[15] Even if the grounds
for such a motion are apparently valid, indeed serious, this does not appear to
be a sufficient basis on which to grant the motion.
[16] The argument that
the allegations referred to in the motion run the risk of making the evidence
onerous, thereby requiring several additional days of hearing, simply seems premature
in my view. The judge who will be seized of the matter at the hearing will be decide
what is relevant and what is not.
[17] The Appellant
submits that the allegations referred to in the motion constitute the
foundation of his arguments to the effect that the assessment is unwarranted
and incorrect in law.
[18] The principles and case law that govern such motions
to strike out pleadings are well-known; in fact, the parties do not dispute the
law on this point.
[19] In Hunt v. Carey Canada Inc., [1990] 2 S.C.R. 959,
the Supreme Court of Canada enunciated, at page 980, the test that
governs such motions:
. . . assuming
that the facts as stated in the statement of claim can be proved, is it "plain
and obvious" that the plaintiff’s statement of claim discloses no
reasonable cause of action? As in England, if there is a
chance that the plaintiff might succeed, then the plaintiff should not be "driven
from the judgment seat". Neither the length and complexity of the issues,
the novelty of the cause of action, nor the potential for the defendant to
present a strong defence should prevent the plaintiff from proceeding with his
or her case. Only if the action is certain to fail because it contains a
radical defect . . . should the relevant portions of a plaintiff’s statement of
claim be struck out under Rule 19(24)(a).
[20] In Morris v. The Queen, T.C.C.,
No. 92-581(IT), December 3, 1992, [1992] T.C.J.
No. 787, 93 DTC 316, Bonner J. summarized the principles that govern motions
to strike pleadings:
Generally speaking, allegations of fact in a
statement of claim should be taken as being true or capable of being proven.
The reference for that is Unterreiner v. Wilson (1982) 40 O.R. 2nd 197,
which was later affirmed by the Court of Appeal.
2. There is a heavy burden on the attacking
party to show that it is clear and obvious that the pleading is scandalous,
frivolous or vexatious, or that it is otherwise an abuse of the process of the
Court. The authority for that proposition is Erasmus v. The Queen, 91
D.T.C. 5415.
3. "Embarrassing" means that the
allegations are so irrelevant that to allow them to stand would involve useless
expense and would also prejudice the trial of the action by involving the
parties in a dispute that is wholly apart from the issues. "In order that
the allegations should be struck out from a defense on that ground, it seems to
me that their irrelevancy must be quite clear and, so to speak, apparent at the
first glance. It is not enough that on considerable argument it may appear that
they do not afford a defense." That is a quotation from [the decision
of Pickford L.J. in] City of London v. Horner (1914) 111 LT
512.
[21] More recently, Chief Judge Bowman specified as follows
in HSBC Bank Canada v. The
Queen, No. 2006-3579(IT)G, 2007 TCC 307, June 19, 2007,
at paragraph 9:
A motion to strike out a pleading should be
granted only where it is clear and obvious that pleading is scandalous,
vexatious or frivolous or an abuse of the Court’s process. (Hunt v. Carey
Canada Inc., [1990] 2 S.C.R. 959 at 980; Erasmus v. The Queen, 91 DTC 5415 at 5416; Gould v. The Queen,
[2005] DTC 1311; Niagara Helicopters Limited v.
The Queen, [2003] DTC 513 at 514‑515.) An example of the type of frivolous
and vexatious pleading that section 8 of the Rules is aimed at is Davitt v. The Queen,
[2001] DTC 702.
[22] In addition, as Rip J. (as he then was) noted
in Status-One Investments Inc. v. Her Majesty
the Queen, T.C.C., No. 2002‑2867(IT)G, July 27, 2004:
[TRANSLATION]
[13] It should also be
noted that the decision whether or not to grant a motion under section 53
of the Tax Court of Canada Rules falls within the Court's discretion.
This discretion results from the word "may", which is used by
Parliament at the beginning of the provision.
[23] In her written submissions and during oral argument,
the Respondent referred to Gauthier (Gisborn) v. The Queen,
2006 TCC 290,
a decision of Justice Campbell Miller on a motion to strike out pleadings in an
appeal where Métis alleged that they were immune from taxation. After reviewing
the case law pertaining to the striking of allegations, Justice Miller ordered
the allegations struck out on the basis that they did not identify the precise
nature of the asserted right to self‑government and that the Appellant's
pleadings were so incomplete that they were futile. Justice Miller specified:
[18] Based on the
Supreme Court of Canada's, and other courts' approach to the analysis of
aboriginal rights protected by section 35 of the Constitution Act, 1982
what, if any, chance do the Appellants have in advancing their section 35
pleading on the basis of an inherent right of self-government (which carries
with it immunity from taxation)? I find their position is not just weak – it is
impossible.
[19] The Appellants'
pleadings do not pass the first hurdle of clearly characterizing a specific
right related to specific practices, customs or traditions. There is nothing
but bald assertions in the pleadings – no substantive support.
[20] For the Appellants' claim to succeed they must
plead
(i) the exact nature of the right claimed;
(ii) the actions taken by the party pursuant to that
right;
(iii) the infringing statute; and
(iv) the historical background to establish the right.
[24] Although the fundamental question (self-government)
in the instant motion appears to be similar to the question considered by
Miller J. in Gauthier (Gisborn),
the decision to grant the motion to strike in that case is distinguishable in a
number of respects:
·
the allegations in the
pleadings are more detailed and precise than they were in Gauthier;
·
the nature of the right
claimed is specified (and not vague);
·
the pleadings contain
enough relevant facts in support of the allegations, including the possibility
that an aboriginal right exists.
[25] Although the
Respondent's submissions in support of the motion to strike out the pleadings
raise a doubt as to whether the contested paragraphs are reasonable, I am of
the opinion that the Respondent has not sufficiently shown that the allegations
in the Amended Notice of Appeal and the Answer clearly disclose no cause of
action or that they are scandalous, frivolous or vexatious.
[26] I
should also point out that, on January
24, 2007, the Federal Court
of Appeal (A-112-06, 2007 FCA 59) affirmed the decision of Woods J. In Ronald
Robertson v. The Queen, No. 2004-3561(IT)G, March 8, 2006, dismissing
such a motion to strike.
[27] There, the Crown
sought to have allegations regarding aboriginal fishing rights and the
application of Treaty No. 5 struck out. Woods J. was not satisfied that the test laid down by
the Supreme Court of Canada in Hunt v. Carey Canada Inc. had been met:
[17] The onus on the party seeking to strike
pleadings under these sections is high. Courts will not strike the
pleadings unless the other party clearly has no chance of success: Hunt v.
Carey Canada Inc., [1990] 2 S.C.R. 959 (S.C.C.). In my view, the
respondent's argument does not meet this high threshold.
[28] Lastly, in the Federal Court of Appeal's
decision, Evans J.A. wrote:
[4] It is conceded that,
in considering whether the pleading should be struck, the Judge applied the
correct legal test, namely, whether it was plain and obvious that this portion
of the notice of appeal had no chance of success: Hunt v. Carey Canada Inc.,
[1990] 2 S.C.R. 959. Hence, in order to warrant the intervention of this Court,
the appellant must demonstrate that, in making this discretionary interlocutory
order, the Judge committed a palpable and overriding error in her application
of the law to the facts, or made some error of law.
[5] We are not persuaded
that she did so err. In our opinion, it was reasonably open to the Judge to
conclude that it was not plain and obvious that the impugned portion of the
pleading was bound to fail. In other words, it is arguable that, in subjecting
aboriginal and/or treaty rights to fish commercially to the game laws in force
in the province, section 13 of the Manitoba Natural
Resources Transfer Agreement, 1930, did not thereby totally extinguish the rights in question.
[29] In
conclusion, I am of the opinion that the motion to strike must be dismissed,
with costs in the cause.
Signed at Ottawa, Canada, this 10th day of October 2007.
"Alain Tardif"
Translation
certified true
on this 29 day of January
2008.
François Brunet, Revisor
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