Alexandre v. The Queen, 2005 TCC 414

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          Agent for the Applicant:                       Carlos Teixeira

          Counsel for the Respondent:                Jeremy Streeter

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ORDER

          Upon application for an Order extending the time within which an appeal from the assessment made under the Income Tax Act for the 2002 taxation year may be instituted;

          The application for the 2002 taxation year is dismissed.

          Signed at Ottawa, Canada this 14^th day of July 2005.

Rip J.

REASONS FOR ORDER

Rip J.

[1]      Nuno Alexandre has applied for an extension of time within which to file a notice of appeal from his tax assessment for 2002: subsection 167(5) of the Income Tax Act.

[2]      Mr. Alexandre did not attend at trial. He was represented by Carlos Teixeira, his accountant and agent. Mr. Teixeira was the applicant's sole witness.

[3]      Mr. Teixeira acknowledged that he or his firm received a notice of confirmation of the assessment for 2002, dated November 9, 2004, on or about November 9, 2004 and that Mr. Alexandre instructed him to file a notice of appeal within 90 days of the date of the notice of confirmation, that is February 7, 2005. Mr. Teixeira testified that Mr. Alexandre "called me numerous times" to see if the notice of appeal had been filed. Mr. Teixeira told Mr. Alexandre that there was time to file.

[4]      In mid-January 2005 Mr. Teixeira aggravated a back "problem" he suffered from in September and was kept in bed and was away from the office until mid-February, after the 90 day period to appeal had expired. He believed the 90 days terminated in March.

[5]      On Mr. Teixeira's return to the office, Mr. Alexandre telephoned him again, Mr. Teixeira said, to check if the appeal had been filed. Mr. Teixeira made the application for extension of time to appeal on his return to the office and the application was received by the Court on March 3, 2005.

[6]      Mr. Teixeira admits that the failure to file the appeal on time was his fault and he acted immediately upon realizing the failure. He explained that since his accident in autumn 2004 he has been prescribed morphine. After his accident in February, the morphine was increased for a period. He was treated with morphine through the 90 day period to file an appeal. In his view the morphine affected his judgment. He suggested that the failure to file the notice of appeal on time was due to the morphine.

[7]      Mr. Teixeira is an accountant. He employs five bookkeepers. He believes that no one in his office was competent to file a notice of appeal at the time he was bedridden in mid-January and February 2005.

[8]      The application filed by Mr. Teixeira is faulty. It does not set out any reasons and circumstances of the case to even suggest it would be just and equitable to grant the application, for example, and states that a "(N)otice of decision dated 19th of June 2004 (sic) received through registered mail by the taxpayer (sic) dated August 8, 2004. Consequently we are requesting an extension of time within which an appeal may be instituted". Mr. Teixeira acknowledged that the reference to the "Notice of decision" is irrelevant to the application.

[9]      The application is dated February 7, 2004; Mr. Teixeira said the application was "backdated" to the nineteenth day following the date of the notice of confirmation. Attached to the application is a notice of appeal dated November 3, 2004, from Mr. Teixeira to the Tax Court of Canada; the notice of appeal refers to the notice of confirmation dated November 9, 2004. Mr. Teixeira could not explain the reason the notice of appeal is dated as it is. He again suggested that the morphine affected his ability.

[10]     Mr. Teixeira stated that since the application was filed only 24 days after the 90 day period, the application should be allowed; he made the application, he argues, as soon as circumstances permitted. He referred to two cases, 2318-2256 Québec Inc. v. The Queen[1] and Swartz v. The Queen.[2]

[11]     In 2318-2256 Québec Inc., a taxpayer's former accountant neglected to take appropriate action to file a notice of objection and time for filing expired. The taxpayer's application was allowed. The principal shareholder of the corporation testified that he was not informed of the Minster of National Revenue's decision to confirm the assessment until after the appeal period had expired. This is not the case at bar where, according to Mr. Teixeira, Mr. Alexandre did know of the notice of confirmation almost immediately.

[12]     Mr. Swartz was successful because he was able to demonstrate that he fulfilled the conditions in subparagraph 167(5)(b), specifically that:

[13]     Mr. Alexandre did not testify. There is no evidence before me that he was unable to act or instruct another to act in his name. Indeed, he did instruct another to act in his name and that person, for whatever reason, fouled up. I do not know if Mr. Alexandre was aware of Mr. Teixeira's health problems or if he suspected any problem that would affect Mr. Teixeira's ability to act. I will infer that he had a bona fide intention to appeal. Also, the application was made soon after Mr. Teixeira realized his error.

[14]     I am being asked to consider the negligence of an agent in these circumstances as a just and equitable reason to grant the application.

[15]     I am not satisfied that the morphine prescribed to Mr. Teixeira affected his ability to honour his obligation to Mr. Alexandre. Mr. Teixeira offered no medical evidence that the amount of morphine administered to him was so great that he was unable to make rational decisions in the course of carrying on his business. He does continue to carry on his business even though he is still being prescribed morphine.

[16]     Mr. Teixeira's error was in miscalculating the 90 day period within which to file a notice of appeal. He thought the deadline was in March. Even if he had not entered the hospital in January, it is probable that he would not have filed the notice of appeal within the 90 days of the notice of confirmation.

[17]     In situations where the knowledge of the taxpayer is relevant, in this case whether Mr. Alexandre knew that Mr. Teixeira was hospitalized or under medication, the taxpayer should be available to testify at the hearing. Mr. Alexandre did not do so, again on the advice of Mr. Teixeira.

[18]     Mr. Alexandre was unable to demonstrate that he fulfilled the conditions set out in subparagraph 167(5)(b) to permit me to allow this application.

[19]     The application is dismissed.

          Signed at Ottawa, Canada this 14^th day of July 2005.

"Gerald J. Rip"

CITATION:                                        2005TCC414

COURT FILE NO.:                             2005-694(IT)APP

STYLE OF CAUSE:                           Nuno Alexandre v. Her Majesty the Queen

PLACE OF HEARING:                      Toronto, Ontario

DATE OF HEARING:                        June 13, 2005

REASONS FOR ORDER BY:            The Honourable Justice Gerald J. Rip

DATE OF ORDER:                            July 14, 2005

APPEARANCES:

COUNSEL OF RECORD:

       For the Appellant:

                   Name:                             

                   Firm:

       For the Respondent:                     John H. Sims, Q.C.

                                                          Deputy Attorney General of Canada

                                                          Ottawa, Ontario