Date: 20010730
Docket: 1999-464-IT-G, 1999-466-IT-G, 1999-467-IT-G,
1999-468-IT-G, 1999-469-IT-G, 1999-472-IT-G, 1999-473-IT-G,
1999-474-IT-G, 1999-475-IT-G, 1999-476-IT-G, 1999-478-IT-G,
1999-479-IT-G, 1999-480-IT-G, 1999-481-IT-G, 1999-484-IT-G,
1999-486-IT-G, 1999-487-IT-G, 1999-488-IT-G.
BETWEEN:
DOUGLAS H. MATHEW, STEVEN M. COOK, EUGENE KAULIUS, CHARLES E.
BEIL, 347059 B.C. Ltd., JOHN R. OWEN, AMALIO DE COTIIS, WILLIAM
JOHN MILLAR, NSFC HOLDINGS LTD., WARREN J. A. MITCHELL, TFTI
HOLDINGS LIMITED, IAN H. PITFIELD, THE ESTATE OF THE LATE LORNE
A. GREEN, INNOCENZO DE COTIIS, VERLAAN INVESTMENTS INC., FRANK
MAYER, CRAIG C. STURROCK, JOHN N. GREGORY,
Appellants,
and
HER MAJESTY THE QUEEN,
Respondent.
Reasons for order
P.R. Dussault, J.T.C.C.
[1]
These reasons are in support of an Order concerning the
admissibility in evidence of an expert report filed with the
Court and served on the Appellants by the Respondent as well as
the admissibility of restricted testimony by Mr. Richard
Charles Taylor, the author of the report.
[2]
Counsel for the Respondent attempted to have Mr. Taylor
recognized as an expert and his report entered as evidence.
Mr. Taylor is a chartered accountant and a chartered
business valuator with the firm of Low Rosen Taylor Soriano. In
his report Mr. Taylor expresses his opinion regarding the
commercial and economic rationale for the investment in Class A
units of a general partnership known as SRMP. His conclusions and
opinion are couched in the following terms at pages 2 and 40
of the report:
(page 2)
Based on my scope of review and analysis and subject to the
qualifications, assumptions and restrictions noted herein, in my
opinion, a profit-oriented business person acting reasonably
would not enter into the transactions, as described herein, in
the absence of or excluding income tax considerations. Further,
the monetary returns provided by the tax deduction resulting from
the investment described herein, greatly exceed the potential
returns to be generated from the real estate portfolio.
(page 40)
As stated above, it is my opinion that on a purely commercial
basis, a prudent investor would not have purchased the Class A
units of SRMP absent other considerations. The Class B units of
SRMP however were at nominal cost to the unit holders. Any return
on the portfolio would yield a positive return, and quite
probably a return in excess of a market rate of return for a real
estate investment of this nature. This excessive return would in
part be due to the smaller, less than market return demanded by
the Class A unit holders.
[3]
While Mr. Taylor admitted that he had benefited from the
collaboration of one of his partners in reaching his conclusions,
he declared that he was in a position to defend fully the opinion
stated in the report submitted as evidence. Mr. Taylor
explained that he based his opinions on what he called
"hypotheticals", as well as on certain assumptions that
he had made. According to him, his "hypotheticals" came
from various documents listed on page 2 of his report, under the
heading Scope of Review, as follows:
i)
The transcript of the testimony of Eugene Kaulius at the trial of
the OSFC case;[1]
ii) The
transcript of the testimony of Stewart Robertson at the trial of
the OSFC case;
iii) Discovery
productions of the Appellants ("Appellants Common
Documents");
iv)
Discovery productions of Her Majesty the Queen [of 347059 B.C.
Ltd.];
v) Transcripts of
the Examinations for Discovery of Messrs. Cook, Mathew, Gregory,
Sturrock, Pitfield, Mitchell and Michael De Cotiis;
vi) Answers
to undertakings of Messrs. Cook and Gregory in connection with
their Examinations for Discovery.
[4]
While counsel for the Appellants did not dispute the
qualifications of Mr. Taylor as a business valuator, he
objected to the admission of his expert evidence on the basis
that his report did not fall within the scope of those
qualifications. He pointed out that Mr. Taylor arrived at what
are in effect some 30 conclusions of fact and law—notably
in the Analysis and Issues section of his report—on
matters in respect of which Mr. Taylor admitted that he was not
in any better position than the Court to draw such
conclusions.
Arguments submitted on behalf of the Appellants
[5]
Counsel for the Appellants submitted that the leading case on the
admissibility of expert evidence is R. v. Mohan, [1994] 2
S.C.R. 9, in which the Supreme Court of Canada set out the
following criteria for determining whether expert evidence is
admissible, at p. 20:
(a) relevance;
(b) necessity in assisting the trier of fact;
(c) the absence of any exclusionary rule;
(d) a properly qualified expert.
[6]
In particular, counsel took issue with the evidence in question
on the basis of the criteria of relevance and of necessity in
assisting the trier of fact and submitted that the opinion
Mr. Taylor was being asked to give was not an expert
opinion, although there was expert analysis buried within it. In
summary, counsel submitted the following reasons for excluding
Mr. Taylor's evidence:
· The opinion
essentially goes to the ultimate issue. As a result, the Court
should be very careful when it comes to admitting it.
· The opinion
is based on a review of transcripts of an entirely different
trial and of transcripts of examinations for discovery which are
not part of the evidence before the Court.
· It is from
what Mr. Taylor believed to be the relevant parts of these
documents that he drew the findings of fact on which he based his
final opinion. In so doing, he undertook the very function that
counsel and the Court play in the litigation process. In basing
his opinion on his own findings of fact, Mr. Taylor usurps the
function of the Court, and that violates the basic rationale for
the admission of opinion evidence.
· Most of the
inferences and conclusions in the report do not concern technical
matters outside the Court's knowledge and therefore they are
not necessary to enable the Court to appreciate the matters in
issue due to the technical nature of these matters.
· The
remaining part of the report is a matter of arithmetic, which is
not beyond the Court's ability, considering the various
arithmetical calculations brought out by the Respondent's
counsel in cross-examination of the various witnesses.
· The opinion
expressed in the report overreaches in that it purports to
establish how a reasonable businessperson would behave.
[7]
In addition to the Mohan case, counsel referred to
RIS-Christie Ltd. v. The Queen, 99 DTC 5087 (F.C.A.),
Surrey Credit Union v. Willson, 45 B.C.L.R. (2d) 310
(B.C.S.C.), Emil Anderson Const. Co. V. B.C. Ry. Co., 15
B.C.L.R. (2d) 28 (B.C.S.C.), Yewdale v. Insurance Corp. of
British Columbia, 3 B.C.L.R. (3d) 240 (B.C.S.C.), Johnson
v. Goldsmid, [1987] B.C.J. No. 2530 (QL) and Adam v.
Campbell, [1950] 3 D.L.R. 449 (S.C.C.) to support his
contention. He also referred to J. Sopinka, S.N. Lederman and
A.W. Bryant, The Law of Evidence in Canada, 2nd ed.
(Toronto and Vancouver: Butterworths, 1999), p. 641.
Arguments submitted on behalf of the Respondent
[8]
The arguments of counsel for the Respondent consisted mainly of
the following propositions:
· The
ultimate issue in the present appeals is whether the SRMP
purchase transactions were avoidance transactions, i.e. whether
they may reasonably be regarded as not having been entered into
primarily for bona fide purposes other than to obtain a
tax benefit that accrued to the Appellants. However,
Mr. Taylor's evidence is directed solely at whether
these transactions were ones which profit-motivated businessmen
would enter into in the absence of tax benefits. His opinion
therefore does not go to the ultimate issue.
· Regardless
of whether Mr. Taylor may be said to express an opinion on the
ultimate issue, it is well settled that the old rule—namely
that no opinion may be expressed on the ultimate issue—no
longer applies. (On this point, counsel referred to J. Sopinka,
S.N. Lederman and A.W. Bryant, The Law of Evidence in
Canada (Toronto and Vancouver: Butterworths, 1992), at pp.
537-46).
· There can
be no doubt about the relevance of the evidence proffered by
Mr. Taylor.
· The purely
commercial and economic rationale of the SRMP transactions is by
no means obvious from the documentary evidence in these appeals
or from the Appellants' testimony. As a result,
Mr. Taylor's knowledge is not only helpful to the Court,
it is necessary, particularly with respect to such matters as
valuations of return on investment, quantification of expected
returns, risk assessment and tax impact.
[9]
Counsel also referred the Court to Cotterall v. Canada,
[1995] T.C.J. No. 384 (QL), in which Judge Rip of this
Court commented on the admissibility of expert evidence written
by two persons, only one of whom attended at trial. Counsel
referred in particular to para. 13, in which Judge Rip ruled
that an expert may give evidence only to the extent that he is in
a position to defend fully the report without having to consult
with the other writer. Counsel stated that Mr. Taylor has
already testified that he is in a position to fully defend the
report herein on his own and that his partner's collaboration
would therefore not constitute an impediment to the admissibility
of his opinion evidence.
[10] With
respect to the arguments advanced by counsel for the Appellants,
counsel for the Respondent contended that deficiencies in
expertise resulting, for instance, in reliance on facts
irrelevant to the determination, are to be assessed in
determining the weight to be given the expert evidence, not its
admissibility. On that point, counsel referred to R. v.
Marquard, [1993] 4 S.C.R. 223, in which the Supreme Court of
Canada stated, at p. 243, that:
[t]he only requirement for the admission of expert opinion is
that the "expert witness possesses special knowledge and
experience going beyond that of the trier of fact".
[11] Counsel
further submitted that whether Mr. Taylor relied on more facts
than he needed in order to express his opinion cannot be
determined until Mr. Taylor testifies, since there is no
indication as to whether he actually relied on the facts he
assumed or as to the extent to which those facts were
irrelevant.
[12] With
respect to reliance on hypothetical fact situations, counsel
quoted the 1992 edition of Sopinka, Lederman and Bryant,
supra, at p. 537:
If the expert lacks personal knowledge of the matters in
issue, and is called to give an opinion upon certain disputed
facts, evidence of which has been or will be led at trial, the
opinion may be elicited only through the vehicle of a
hypothetical question.
[13] He then
quoted the following, from p. 539:
The hypothetical fact situation put to the expert witness must
be clear, uncontradictory and proved at trial. The hypothetical
question need not include all the facts relevant to the
expert's opinion. As long as the question incorporates
sufficient assumed facts to enable the witness to give answers of
value, it will be proper.
[14] Applying
the above to Mr. Taylor's evidence, counsel for the
Respondent stated that the transcripts of the examinations for
discovery of some of the Appellants as well as the transcripts of
the oral evidence at trial in the OSFC case that were
given to Mr. Taylor were not evidence before the Court.
Therefore, counsel asserted, they represented facts that he was
asked to assume and thus constituted hypothetical fact situations
at the time Mr. Taylor wrote his expert opinion.
[15] Counsel
further submitted that the nature of the source upon which an
expert opinion is based has no effect on the admissibility of
that opinion. In support of his position, he relied on Saint
John (City) v. Irving Oil Co., [1966] S.C.R. 581, in which
the Supreme Court of Canada ruled expert evidence admissible even
though it was based on information obtained from people who had
not been called to testify in the course of the expert's
investigation. The Court stated, at p. 592, that:
[a]ny frailties which may be alleged concerning the
information upon which the opinion was founded are in my view
only relevant in assessing the weight to be attached to that
opinion . . . .
[16] Applying
the above to Mr. Taylor's evidence, counsel submitted that
even if the facts underlying Mr. Taylor's opinion were not
proven before the Court, that would only affect the weight to be
given to his evidence, and not its admissibility.
[17] In the
same vein, counsel relied on R. v. Warsing, [1998] 3
S.C.R. 579, a case in which the Supreme Court of Canada stated,
at p. 608:
In many cases the evidence of experts depends on the
hypothesis or assumptions that they are asked to make. The value
of the opinion will depend on the validity of the assumptions and
is related to weight not admissibility.
[18]
Alternatively, counsel for the Respondent referred to subsection
145(4) of the Tax Court of Canada Rules (General
Procedure),[2] which reads as follows:
(4) Subject to compliance with subsection (2), evidence in
chief of an expert witness may be given at the hearing by,
(a) reading the whole or part of the affidavit into
evidence by the witness, unless the Court, with the consent of
the parties, permits it to be taken as read, and
(b) if the party calling the witness so elects, the
verbal testimony of the witness,
(i) explaining or demonstrating what is in the affidavit
or the part that has been given in evidence, and
(ii) in respect of other matters by special leave of the
Court, upon such terms as may be just.
[Emphasis added.]
[19] Relying
on subparagraph 145(4)(b)(ii), counsel submitted that even
if the report completely overreaches and might be flawed in
various ways, Mr. Taylor should not be prevented from giving
verbal testimony with respect to limited matters such as market
rates of return on the types of investment in issue in the
present appeals.
[20] Counsel
for the Appellants took exception to such a suggestion. According
to him, if the calculation of an internal rate of return by Mr.
Taylor were admissible, his opinion as to what would constitute a
reasonable rate of return in the circumstances would be
inadmissible because it would flow from the inadmissible
materials reviewed by him from which he made findings of fact
that he cannot "disabuse himself" of.
[21] Counsel
for the Appellants stated that there would be extreme prejudice
in proceeding in that fashion as he would not know at this point
in the trial—which has already lasted nine days—what
opinion Mr. Taylor would be asked to give.
[22] Counsel
also pointed to the fact that he "might very well have run
this trial on a fundamentally different basis" had he
thought that the expert would be asked his opinion on a much
narrower issue. In reliance on the report he received, counsel
for the Appellants proceeded on the basis that the expert
evidence was totally inadmissible given its content and
conclusions and not that it called for a rebuttal opinion, which
he might have sought if Mr. Taylor's report had been confined
to a simple opinion on the calculation of internal rates of
return or of market rates of return on certain types of
investment.
Analysis
[23] In
Mohan, supra, the Supreme Court of Canada
enumerated the applicable criteria for determining the
admissibility of opinion evidence. To those criteria the Court
added "a cost benefit analysis, that is 'whether its
value is worth what it costs'" (p. 21).
[24] The Court
explained the effect of such an inquiry on the relevance analysis
as follows, at p. 21:
Evidence that is otherwise logically relevant may be excluded
on this basis, if its probative value is overborne by its
prejudicial effect, if it involves an inordinate amount of time
which is not commensurate with its value or if it is misleading
in the sense that its effect on the trier of fact, particularly a
jury, is out of proportion to its reliability. While frequently
considered as an aspect of legal relevance, the exclusion of
logically relevant evidence on these grounds is more properly
regarded as a general exclusionary rule (see Morris v. The
Queen, [1983] 2 S.C.R. 190). Whether it is treated as an
aspect of relevance or an exclusionary rule, the effect is the
same. The reliability versus effect factor has special
significance in assessing the admissibility of expert
evidence.
[25] The Court
also explained how the same inquiry affects the necessity
analysis. The Court described the necessity criterion as follows
at p. 23:
What is required is that the opinion be necessary in the sense
that it provide information "which is likely to be outside
the experience and knowledge of a judge or jury": as quoted
by Dickson J. in R. v. Abbey, supra. As stated by
Dickson J., the evidence must be necessary to enable the trier of
fact to appreciate the matters in issue due to their technical
nature. In Kelliher (Village of) v. Smith, [1931] S.C.R.
672, at p. 684, this Court, quoting from Beven on
Negligence (4th ed. 1928), at p. 141, stated that in order
for expert evidence to be admissible, "[t]he subject-matter
of the inquiry must be such that ordinary people are unlikely to
form a correct judgment about it, if unassisted by persons with
special knowledge".
[26] As to the
effect of the cost-benefit analysis, the Court stated, at
pp. 24-25:
As in the case of relevance, discussed above, the need for the
evidence is assessed in light of its potential to distort the
fact-finding process. As stated by Lawton L.J. in R. v.
Turner, [1975] Q.B. 834, at p. 841, and approved by Lord
Wilberforce in Director of Public Prosecutions v. Jordan,
[1977] A.C. 699, at p. 718:
"An expert's opinion is admissible to furnish the
court with scientific information which is likely to be outside
the experience and knowledge of a judge or jury. If on the proven
facts a judge or jury can form their own conclusions without
help, then the opinion of an expert is unnecessary. In such a
case if it is given dressed up in scientific jargon it may make
judgment more difficult. The fact that an expert witness has
impressive scientific qualifications does not by that fact alone
make his opinion on matters of human nature and behaviour within
the limits of normality any more helpful than that of the jurors
themselves; but there is a danger that they may think it
does."
The possibility that evidence will overwhelm the jury and
distract them from their task can often be offset by proper
instructions.
There is also a concern inherent in the application of this
criterion that experts not be permitted to usurp the functions of
the trier of fact. Too liberal an approach could result in a
trial's becoming nothing more than a contest of experts with
the trier of fact acting as referee in deciding which expert to
accept.
These concerns were the basis of the rule which excluded
expert evidence in respect of the ultimate issue. Although the
rule is no longer of general application, the concerns underlying
it remain. In light of these concerns, the criteria of
relevance and necessity are applied strictly, on occasion, to
exclude expert evidence as to an ultimate issue. Expert
evidence as to credibility or oath-helping has been excluded on
this basis. See R. v. Marquard, [1993] 4 S.C.R. 223,
per McLachlin J.
[Emphasis added.]
[27] These
principles were also applied in several cases submitted by
counsel for the Appellants. The following statement by Meredith
J. of the Supreme Court of British Columbia in Johnson v.
Goldsmid, supra, is particularly relevant:
In the first place, Dr. Andrews was left to draw his own
factual conclusions from evidence he was given - much of which
was not even available to the Court. For instance, he was
given to read the complete discoveries, he listened to the
unsworn observations of Mr. Stokie, and he took a view of
the hill, guided by defence counsel. This may ease the burden
for defence counsel considerably and it certainly would ease the
burden on the Court in that the "expert" is left to
decide the case. But it violates the basic rationale for the
admission of opinion evidence of this sort.
First it is usually not for the expert to decide the facts
upon which his opinion is based. But if he does decide certain
facts, they must at least be stated. Let me emphasize: the
opinion must be based on stated facts or hypotheses to be proven
by evidence. In the present case the facts were not stated.
And certainly the expert could not find facts in any event on
hearsay, unsworn and untested. It will usually be for counsel to
prove the facts in Court upon which the opinion is based.
The decisions in Yewdale v. Insurance Corp. of British
Columbia and Surrey Credit Union v. Willson,
supra, also contain similar reasoning.
[28] The
above-cited authorities clearly state that when an expert
witness's opinion relies upon hypothetical facts or
assumptions of fact he has a duty to communicate those
hypothetical facts or assumptions and he cannot make findings of
fact himself. It is worth mentioning that the requirement that
the hypothetical fact situation put to the expert witness be
clear is also stated by Sopinka, Lederman and Bryant (1992),
supra, in a paragraph that counsel for the Respondent
relied on himself.
[29] None of
the authorities referred to by the Respondent's counsel
refute this general principle. Although I recognize that the
nature of the source upon which an expert opinion is based cannot
affect the admissibility of the opinion itself, as stated by the
Supreme Court of Canada in the Saint John case, I am of
the opinion that that source, regardless of its nature, has to be
clearly stated. Similarly, I agree with the Respondent's
counsel that deficiencies in the expert opinion that may result
from reliance on inaccurate assumptions are only relevant
in assessing the weight of the opinion, as the Supreme Court of
Canada stated in the Warsing case, supra. However,
I am also of the opinion that the unknown character of the
assumptions relied on is relevant to the determination of the
admissibility of the expert opinion. In my view, the fact that
the opinion is based on the expert's own findings of fact (as
appears to be the case with Mr. Taylor's report), which are
unknown to the Court, is an issue that relates to its
admissibility. It seems obvious to me that the admission of the
expert evidence in the present case would, as a result of the
extreme difficulty in determining what assumptions were actually
relied on and how accurate they were as well as which ones were
not considered, leave the Court wondering when assessing the
weight to be attached to that evidence. In no way can this meet
the test of clear and unambiguous hypothetical facts.
[30] Moreover,
I think that the Marquard case, supra, relied on by
the Respondent's counsel, is a further argument for refusal
of the evidence in question. In that case, the issue was whether
the expert witnesses, as practising physicians, possessed some
special knowledge related to the burns and child abuse with
respect to which they testified and which were alleged to lie
outside their field of expertise. The Supreme Court of Canada
found that while they were not medical specialists in burns,
there could be no doubt that "as practising physicians they
possessed an expertise on burns which is not possessed by the
ordinary untrained person." It is in this context that the
Court stated that "[t]he only requirement for the admission
of expert opinion is that the 'expert witness possesses
special knowledge and experience going beyond that of the trier
of fact'". As stated by the Appellants' counsel, the
evidence at issue contains several conclusions of fact and law in
respect of which Mr. Taylor does not possess any special
knowledge and experience going beyond that of the trier of fact.
Mr. Taylor readily admitted as much when questioned by the
Appellants' counsel with respect to no less than 30 such
conclusions.
[31] Applying
the foregoing to the expert report as presented before the Court,
I agree with the Appellants' counsel that Mr. Taylor, by
founding his analysis on assumptions he made based on his review
of various transcripts—which moreover were not necessarily
part of the evidence before the Court—"has heard a
different trial, a trial of his own making, a trial that was put
to him . . . ." There is no doubt that Mr. Taylor was
initially sent on a fact-finding mission in the transcripts of
evidence in the OSFC trial and also in discoveries that were
perhaps not all adduced as evidence. I do not agree with counsel
for the Respondent that they were facts that he was asked to
assume and, as such, hypothetical fact situations as required by
the case law. Moreover, it is trite to say that identical sets of
facts can be entered into evidence in a court of law in many
different ways and can produce results that differ widely. This
depends on numerous factors, not the least of which being the
ability of counsel in examination and cross-examination to elicit
the pertinent facts of a case. Hence, we can readily see the
compelling necessity of giving the expert clear, unambiguous and
uncontradicted hypothetical facts on which to give his opinion,
unless it can be based on facts proven in the case at bar.
[32] Moreover,
in my opinion, in admitting Mr. Taylor's report and
testimony, which are based on numerous conclusions of fact
stemming from his reliance on evidence relating to another trial,
there would be a danger that the Court might be led to use that
evidence, at least in part, to decide the present appeals. In
that respect, one can but recall the words of the Federal Court
of Appeal in Attorney General of Canada v. Pompa, 94 DTC
6630; [1995] 1 C.T.C. 466, at p. 469:
If there is one well-settled rule of law it is that a judge
cannot take cognizance of facts coming directly to his attention
in the course of another proceeding to decide on the fate of a
proceeding in which those facts were not entered in evidence. A
judge simply does not have any ex officio knowledge of what he
learned in another case (see Sopinka, Lederman & Bryant,
The Law of Evidence in Canada, Butterworths, Toronto,
1992, page 985) and he is failing greatly in his duty of
neutrality if he makes use of such knowledge (see Ducharme,
Précis de la preuve, 3d ed., Wilson and Lafleur,
Montréal, 1986, page 17). As Professor Ducharme observes,
"the judge's neutrality is the best guarantee of his
impartiality".
[33] The
foregoing analysis would in my view be sufficient to refuse to
admit the evidence at issue. However, I would add that I agree
with counsel for the Appellants that Mr. Taylor's conclusion
that "a profit-oriented business person acting reasonably
would not enter into the transactions, as described herein, in
the absence of or excluding income tax considerations"[3] relates to how a
reasonable person would behave and would seem to be contrary to
the Adam case, supra. In that case, the Supreme
Court of Canada, at p. 458, referred to Phipson on
Evidence, 8th ed., p. 385, in stating the following:
[n]either experts nor ordinary witnesses may give their
opinions upon matters of legal or moral obligation, or general
human nature, or the manner in which other persons would probably
act or be influenced.
[34] In sum, I
find that the whole process from beginning to end "violates
the basic rationale for the admission of opinion evidence"
(see Johnson v. Goldsmid, supra).
[35] With
respect to counsel for the Respondent's alternative argument
to the effect that Mr. Taylor should be permitted to testify
on limited matters within his area of expertise, I agree with the
submissions of counsel for the Appellants. To accept
Mr. Taylor's testimony on limited matters confined to
market rates of return or proper calculation of rates of return
would be to engage in a completely different exercise than the
one Mr. Taylor undertook and which was from the outset an
unauthorized fact-finding mission. First of all, such
acceptance would imply, as counsel for the Appellants said, that
Mr. Taylor could "disabuse himself" of the clearly
inadmissible evidence contained in his report. This would appear
to be more easily said than done and the result would probably be
more theoretical than practical. Secondly, notice was given
pursuant to section 145 of the Tax Court of Canada Rules
(General Procedure) that the evidence Mr. Taylor was going to
give was that contained in his report. Based on his evaluation of
the type of evidence contained in the report, counsel for the
Appellants proceeded to trial on the assumption that the report
could not be admitted in evidence and that a rebuttal opinion was
not necessary in the circumstances. After nine days of trial we
are at a point where counsel for the Respondent is asking the
Court to at least accept Mr. Taylor's testimony on limited
matters within his area of expertise. In my opinion, procedural
fairness embodied in section 145 of the Rules requires that the
report filed and served represent the evidence that the expert is
prepared to give in the matter. The 30 days' notice ensures
that the other party can prepare his case accordingly.
[36] Because
neither the exact opinion Mr. Taylor would be asked to give on
limited matters nor the hypothetical facts which he would have to
assume are precisely known at this point[4] and because counsel for the
Appellants could not and cannot receive advance notice thereof so
as to be able to obtain a rebuttal opinion if necessary, I am
convinced that the prejudice that would be suffered outweighs the
necessity of Mr. Taylor's evidence.
[37] This by
no means implies that expert evidence would not have been more
than useful in the present case had things been done differently
from the outset. However, considering the cost-benefit
analysis referred to in the Mohan case, supra, I am
of the opinion that the criterion of necessity should be applied
strictly and that Mr. Taylor's expert evidence should be
excluded in its entirety.
[38]
Consequently, Mr. Richard Charles Taylor's expert report
filed with the Court and served on the Appellants by the
Respondent will not be admitted in evidence. Mr. Taylor will not
be permitted to give testimony on limited technical matters
confined to his area of expertise. The copies of
Mr. Taylor's report in the Court's possession will
thus be sealed and the envelope containing the same will be
marked as Exhibit I on "voir dire" in the present
appeals.
Signed at Ottawa, Canada, this 30th day of July 2001.
"P.R. Dussault"
J.T.C.C.
COURT FILE
NOS.:
1999-464(IT)G, 1999-466(IT)G, 1999-467(IT)G, 1999-468(IT)G,
1999-469(IT)G, 1999-472(IT)G, 1999-473(IT)G,
1999-474(IT)G, 1999-475(IT)G, 1999-476(IT)G,
1999-478(IT)G, 1999-479(IT)G, 1999-480(IT)G, 1999-481(IT)G,
1999-484(IT)G, 1999-486(IT)G, 1999-487(IT)G,
1999-488(IT)G.
STYLE OF
CAUSE:
DOUGLAS H. MATHEW, STEVEN M. COOK, EUGENE KAULIUS, CHARLES E.
BEIL,
347059 B.C. Ltd., JOHN R. OWEN,
AMALIO DE COTIIS, WILLIAM JOHN MILLAR,
NSFC HOLDINGS LTD.,
WARREN J. A. MITCHELL,
TFTI HOLDINGS LIMITED, IAN H. PITFIELD,
THE ESTATE OF THE LATE LORNE A. GREEN,
INNOCENZO DE COTIIS,
VERLAAN INVESTMENTS INC., FRANK MAYER, CRAIG C. STURROCK, JOHN
N. GREGORY,
and Her Majesty The Queen
PLACES OF
HEARING:
Vancouver, British Columbia
Ottawa, Canada
DATES OF
HEARING:
July 3 - 13, 2001 (Vancouver)
July 18, 2001 (Ottawa)
REASONS FOR ORDER
BY:
The Honourable P.R. Dussault
DATE OF
ORDER:
July 19, 2001
DATE OF REASONS FOR ORDER: July 30, 2001
APPEARANCES:
Counsel for the
Appellants:
Kim Hansen
David Martin
Counsel for the
Respondent:
Luther P. Chambers
Robert Carvalho
COUNSEL OF RECORD:
For the
Appellants:
Name:
Kim Hansen
David Martin
Firm:
THORSTEINSSONS
Vancouver, British Columbia
For the
Respondent:
Morris Rosenberg
Deputy Attorney General of Canada
Ottawa, Canada
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