Citation: 2006TCC687
Date: 20061218
Docket: 2006-1001(GST)I
BETWEEN:
WILLIAM N. SLOVACK,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR JUDGMENT
O'Connor, J.
[1] The issue in this
appeal is whether the Appellant, William N. Slovack and his wife Pierrette Cecile
Slovack are entitled to the New Housing Rebate ("rebate") in
respect of their new home in Courtenay, British Columbia (more fully described
below) which they purchased on April 30, 2001. The rebate in question is
contemplated in section 254 of the Excise Tax Act ("ETA").
The amount of the rebate is based on a formula and in the present case amounts
to $6,318.90. The Appellant's Notice of Appeal refers to section 256 of the ETA
however, this provision relates to owner built homes. The applicable provision
of the ETA is section 254 which relates to a residential complex
purchased by an individual from a builder.
Facts
[2] The basic facts are
as follows:
a) The
Appellant and his wife purchased a new home having a civic address of 110-3399 Crown Isle
Drive,
Courtenay, British Columbia ("Crown
Isle") from KCM 2000 Development Ltd. on April 30, 2001. The Appellant
took possession of Crown Isle on May 1, 2001. The Appellant paid the full 7%
GST on the purchase.
b) The
Appellant and his wife during 2001, 2002 and 2003 commuted between Crown Isle
and their home in Calgary. For various medical reasons they were not convinced that Crown Isle
should be their principal residence and they only declared it as such in 2003.
c) On
April 13, 2004 they applied for the New Housing Rebate in the amount of
$6,318.90.
d) On
May 18, 2004 their application was denied because it had not been filed within
two years of the purchase of Crown Isle, as required under subsection 254(3) of
the ETA.
e) On
June 15, 2004 they filed a Notice of Objection; on February 17, 2006
the Minister confirmed the disallowance of the rebate.
f) The
Appellant acknowledges that the application for the rebate was filed more than
two years after the date of purchase of Crown Isle. He claims however that it
is unfair to disallow the rebate because he was given incorrect information
from his realtor, builder and notary public who indicated he had four
years to file an application rather than merely two. Also in his Notice of
Appeal, the Appellant mentions that he has been held to a very strict standard,
yet the Minister took 18 months to respond – presumably referring to the period
between the Notice of Objection (June 15, 2004) and the Minister's confirmation
(February 17, 2006).
Analysis
and Discussion
[3] I am not aware of any cases to date specifically
dealing with the limitation period in subsection 254(3). This is likely
due to the fact that, under subsection 254(4), the builder may credit the
individual for the amount of the rebate at the time of purchase. Generally,
those that qualify for the rebate obtain it at the point of sale; those that do
not qualify simply do not apply. Therefore, the risk of qualifying buyers not
applying for the rebate within the limitation period is extremely small.
[4] However, there
is significant jurisprudence under the general rebate provision in section 261
and the rebate for owner-built homes in section 256, both of which have
limitation periods[1] comparable to subsection 254(3). Given the
similarities, that jurisprudence is applicable to the limitation period in
subsection 254(3).
[5] The
jurisprudence under these related provisions clearly shows that once the
statutory deadline has passed, no claim for the rebate can be made.
"The
intention of Parliament to limit the time period for the filing of a rebate
application has been set out in clear and unambiguous language... When the
meaning is clear, this Court has no jurisdiction to mitigate a harsh
consequence. While this Court may be entitled to construe the language of an
Act of Parliament, it may not distort it to make it accord with what the Court
may think to be reasonable."[2]
[6] The logic for
this approach is that the ETA provides a "complete code" for
rebate claims.
"I start
from the premise that the right of a taxpayer to obtain a refund of GST must,
at least so far as this Court's jurisdiction is concerned, be found within the
confines of the ETA which contains a complete code."[3]
[7] What does it
mean that the ETA provides a "complete code"?
[8] Section 312 of
the ETA states that recovery rights exist only by statute. It reads:
"Except
as specifically provided for in this Part, the Customs Act or the Financial
Administration Act, no person has a right to recover any money paid to
Her Majesty as or on account of, or that has been taken into account by
Her Majesty as, tax, net tax, penalty, interest or any other amount under this
Part."
[9] Further, the ETA
uses "clear and unambiguous language"[4], to lay out the rebate requirements, time limits and procedures
for appeal.
"The use
of the words 'shall not' deprives both the Minister and this Court of any
discretion to extend the time for filing, even where the circumstances … call
out for such an extension to be granted"[5].
[10] As a "complete
code", the rebate can be understood and administered without recourse to
any outside statute or laws of general application. Therefore, just as with subsections
261(3) and 256(3), the Court would have no discretion to waive or disregard the
limitation period in subsection 254(3), based on equity or compassion for
special circumstances.
Conclusion
[11] The Appellant
admits that the application was filed more than two years after the date he
purchased the home. However, he claims that it is unfair to disallow the rebate
because he was given incorrect information from his realtor, builder and notary
public. This was precisely the issue in Pickering[6] where new homeowners received erroneous information
from their builder. The Court held that "it is indeed an unfortunate set
of facts ... [but] the Court does not have remedial legislative or inherent
powers to assist the Appellants".
[12] In conclusion for the above reasons the appeal is
dismissed.
[13] There is little doubt that in the special circumstances
of this case – the wrong advice given to the Appellant by the realtor, builder
and notary public, the medical conditions of the Appellant and his wife
delaying their decision on declaring Crown Isle their principal residence and
the considerable delays of the Minister – that there appears to be an
unfairness. In analogous circumstances this Court has recommended that the
taxpayer seek a Remission Order under the Financial Administration Act
and I make the same recommendation to the Appellant in this case.
Signed at Ottawa, Canada, this 18th day of December, 2006.
"T. O'Connor"
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