Collins v. The Queen, docket 2001-1013-GST-G

Date: 20010612

Docket: 2001-1013-GST-G

BETWEEN:

R. MAXINE COLLINS,

Appellant,

and

HER MAJESTY THE QUEEN,

Respondent.

Reasons for Order

Bowman, A.C.J.

[1]            This motion for directions raises a somewhat interesting and novel point.

[2]            The appellant appeals from an assessment made under the Goods and Services provisions of the Excise Tax Act. She withdrew amounts from a Group Self-Directed Retirement Savings Plan under the Bank of Nova Scotia Trust Company acting as Trustee. A withdrawal fee of $50.00 was charged by the trust company and GST of $3.50 was collected. The appellant objected and the objection was disallowed and the assessment confirmed.

[3]            The appellant filed her appeal under the General Procedure Rules as a Class A action and paid the filing fee of $250.00. On this motion obviously I cannot decide the merits of the appeal beyond observing that it raises a fairly justiciable issue the determination of which may affect anyone who is charged a fee upon the withdrawal of funds from a RRSP. Obviously the appellant considers that an important question of principle is involved here. Only $3.50 in tax is in issue, but she evidently feels strongly enough about the matter that she is prepared to pay a $250.00 filing fee and also run the risk of having costs assessed against her if she is unsuccessful.

[4]            No reply to the notice of appeal has been filed. However the respondent served and filed a consent to judgment dated May 15, 2001 which reads as follows

CONSENT TO Judgment

The Respondent consents to judgment allowing the appeal with respect to Notice of Assessment No. 002-920-976-123-700-01 dated November 3, 2000, in respect of the period February 1, 2000 to June 30, 2000, without costs, and referring the matter back to the Minister of National Revenue for reconsideration and reassessment on the basis that:

1.              The Appellant is to receive a Goods and Services Tax Rebate in the amount of $3.50, pursuant to section 261 of the Excise Tax Act, R.S.C. 1985, c. E-15, as amended.

2.              The Appellant is not entitled to any further relief.

[5]            It was signed by counsel for the respondent. It was not signed by or on behalf of the appellant.

[6]            Section 170 of the General Procedure Rules reads

When all parties have consented in writing to a judgment disposing of an appeal, the Court may,

                (a) grant the judgment sought without a hearing,

                (b) direct a hearing, or

                (c) direct that written representations be filed.

[7]            A "consent" signed only by one party is not a consent signed by "all parties" as contemplated by section 170. No party is obliged to accept such a document, a fortiori when the "consent" seeks to deprive the other party of costs. It is obvious that the Court cannot act on such a document. The Court is not obliged to implement a consent to judgment if it is not satisfied that it is in accordance with the law: The Clarkson Co. Ltd. v. The Queen, 79 DTC 5150 at p. 5151, footnote 3. Indeed, section 170 of the Rules expressly contemplates the possibility that the Court might question a consent to judgment and direct a hearing or written submissions particularly where, as here, it involves a judgment that would result in payment of money out of the Consolidated Revenue Fund without an appropriation or vote by Parliament for that purpose. The matter is discussed at length by Le Dain, J. in the Federal Court of Appeal in The Queen v. Stevenson Construction Co. Ltd. et al, 79 DTC 5044 at 5049-5050. The point is of such importance that the passage from the reasons of Le Dain, J. merits repetition.

The Court raised this question of its own motion because of the view expressed in certain cases that the Court should not find the Crown liable on the basis of consent unless it is satisfied that on the facts and law the Crown is liable. To do otherwise would be to circumvent the constitutional principle by which Parliament controls the expenditure of public funds. See The King v. Hooper, [1942] Ex. C.R. 193; Galway v. M.N.R., [1974] F.C. 600; Northrop Corp. v. The Queen et al. [1977] 1 F.C. 289; The Clarkson Company Limited & Rapid Data Systems & Equipment Limited v. The Queen, No. A-884-77, Judgment of the Federal Court of Appeal September 11, 1978, as yet unreported. The principle involved was expressed by Thurlow A.C.J. in the Northrop case at pp. 291-9 as follows:

                It is, I think, plain that if this were an ordinary action between private persons of full age and capacity the Court would not hesitate to grant the judgment requested. But that is a situation in which there is no limitation on the power of the private person to commit his own resources. The problem for the Court here, as I see it, is different. It is whether this Court can on such materials as are before it properly grant judgment as asked against the Crown. The answer in my opinion turns upon subsection 57(3) of the Federal Court Act and the effect to be given to it. It reads:

                57.(3)       There shall be paid out of the Consolidated Revenue Fund any money or costs awarded to any person against the Crown in any proceedings in the Court.

                The result of a judgment of this Court against the Crown is thus to authorize payment of the amount awarded from the Consolidated Revenue Fund without an appropriation or vote for that purpose by Parliament. On the hearing of the motion counsel for the plaintiff freely conceded that it was because there was no appropriation or vote from which the $1,888,131 could be paid and because it would involve at least a considerable delay before such an appropriation might be made that judgment of the Court for the amount was being sought.

[8]            At best the "consent" can be treated as an offer to settle the case by paying back $3.50 without costs. The offer has been rejected by the appellant.

[9]            The appellant's notice of motion is as follows

TAKE NOTICE THAT the applicant is making a Motion for Direction by the Court pursuant to subsection 4(2) of the Tax Court of Canada Rules (General Procedure) and requests that the Court dispose of this motion upon consideration of written representation and without appearance of the parties pursuant to subsection 69(1) of the Tax Court Rules (General Procedure).

THE MOTION IS FOR direction by the Court as to the procedure to be followed in order to obtain written Reasons for Judgment in this appeal. In the interest of complying with the Respondent's wishes regarding incursion of additional costs, is it is possible to obtain written Reasons for Judgment pursuant to subsection 167(3) of the Tax Court Rules through filing a Motion For Judgment pursuant to subsection 63(1) of the Tax Court Rules or is it necessary to have the appeal proceed to hearing in order to obtain written Reasons for judgment.

THE GROUNDS FOR THE MOTION ARE as follows:

This appeal was filed in the interest of accomplishing two objectives.

(1)            To obtain a Judgment, which under the General Procedure is binding upon the Canada Customs and Revenue Agency (CCRA), with respect to the CCRA's erroneous administrative policy of requiring registrants to collect and remit GST/HST based on exempt service fees charged to holders of self-directed Registered Retirement Savings Plans (RRSP's).

(2)            To obtain a record of this judgment together with the reasons relating thereto in order to make Canadian taxpayers aware that they have been paying GST/HST in error in respect of exempt service fees charged in relation to self-directed RRSP's since 1991.

I feel it is important that taxpayers understand the reasons why they have been paying tax in error for a considerable period of time.

If the Court simply awards the relief sought in this appeal, I have failed to accomplish my objectives and I have wasted the Court's time for $3.50.

It is my concern that without published Written Reasons for Judgment the following will result:

·               the CCRA will continue to require registrants to collect GST/HST in respect of exempt service fees charged to self-directed RRSP's,

·               Canadian taxpayers will continue to pay tax in error,

·               Canadian taxpayers will be unaware that they are entitled to refund of tax paid in error in this regard.

THE FOLLOWING DOCUMENTARY EVIDENCE is referred to for purposes of consideration by the Court in disposing of this motion.

·               Letter dated May 16, 2001, addressed to my attention by Suzanne M. Bruce, Counsel for the Respondent.

·               Consent to Judgment with respect to Notice of Assessment No. 002-920-976-123-700-01 filed by Counsel for the Respondent.

[10]          The respondent's argument is as follows

Our submissions with respect to the Appellant's Motion, dated May 18, 2001, are as follows:

1. The Respondent is prepared to Consent to Judgment in the sum of $3.50, or in the alternative, reassess to allow a refund in the amount of $3.50, to avoid additional costs.

2. It is respectfully submitted that the maxim de minimis non curat lex applies in this matter: Union Gas Ltd. v. TransCanada PipeLine Ltd., [1974] 2 F.C. 313 (T.D.); R v. Webster (1981), 15 M.P.L.R. 60 (Ont. Dist. Ct.), Farnell Electronic Components v. Collector of Customs (November 7, 1996), (Fed. Ct. Australia) [unreported] (copy enclosed).

3. In any event, it is respectfully submitted that there is no procedure to obtain written reasons on a substantive issue without a trial. Therefore, Reasons for Judgment would only be appropriate after a General Procedure trial were held.

4. It is respectfully submitted that this application should be dismissed.

5. If a General Procedure trial were to proceed, we seek leave to extend time to file our Reply, pursuant to s. 12 of the Tax Court of Canada Rules (General Procedure).

[11]          The de minimis non curat lex doctrine, which I daresay may probably still be good law in some circumstances, should not be raised in a motion for directions. While the respondent may, if she wishes, raise the argument at the hearing and the presiding judge can consider it, this is not the place to argue it. The appellant wishes to litigate a point of considerable general importance and I have no intention of depriving her of her right to do so simply because the amount involved in her appeal is small, on the basis of a flawed "consent" to judgment. I agree that reasons for judgment can only be rendered after a hearing. A consent to judgment has no precedential value and the CCRA cannot avoid having the legal correctness of its position reviewed by the Court by the simple expedient of filing a one-sided consent which is in effect no consent at all.

[12]          The consent to judgment is rejected. The appellant is entitled to a hearing and, following a hearing, to the reasons for judgment that she seeks. The respondent has 30 days from the date of this order to file and serve a reply to the notice of appeal following which the appellant if she wishes may apply for a trial date under section 123 of the Tax Court of Canada Rules (General Procedure).

[13]          The costs of this motion shall be costs in the cause.

Signed at Ottawa, Canada, this 12th day of June 2001.

"D.G.H. Bowman"

A.C.J.

COURT FILE NO.:                                                 2001-1013(GST)G

STYLE OF CAUSE:                                               Between R. Maxine Collins and

                                                                                                Her Majesty The Queen

WRITTEN SUBMISSIONS

                FROM THE APPELLANT: May 18, 2001

                FROM THE RESPONDENT:               May 22, 2001

REASONS FOR ORDER BY:                               The Honourable D.G.H. Bowman

                                                                                                Associate Chief Judge

DATE OF ORDER:                                                June 12, 2001

APPEARANCES:

For the Appellant:                                                 The Appellant herself

Counsel for the Respondent:              Suzanne M. Bruce

COUNSEL OF RECORD:

For the Appellant:                

Name:                      --

Firm:                        --

For the Respondent:                             Morris Rosenberg

                                                                                Deputy Attorney General of Canada

                                                                                                Ottawa, Canada

2001-1013(GST)G

BETWEEN:

R. MAXINE COLLINS,

Appellant,

and

HER MAJESTY THE QUEEN,

Respondent.

The Honourable D.G.H. Bowman

Associate Chief Judge

ORDER

          Upon a motion for directions by the appellant,

It is ordered that the consent to judgment be rejected. The respondent has 30 days from the date of this order to file and serve a reply to the notice of appeal following which the appellant if she wishes may apply for a trial date under section 123 of the Tax Court of Canada Rules (General Procedure).

          The costs of this motion shall be costs in the cause.

Signed at Ottawa, Canada, this 12th day of June 2001.

"D.G.H. Bowman"

A.C.J.