Citation: 2016 TCC 234
Date: 20161021
Dockets: 2012-3399(IT)I
2012-4035(IT)G
BETWEEN:
ALEXANDER
DI MAURO,
Appellant,
and
HER
MAJESTY THE QUEEN,
Respondent.
REASONS
FOR ORDER ON COSTS
Boyle J.
[1]
Mr. Di Mauro’s tax appeals in respect
of his Fiscal Arbitrators claims were the subject of a case‑managed status
hearing in Toronto, Ontario, on August 23, 2016. On that day, there were about
20 Fiscal Arbitrators files set down for pre-hearings or status hearings.
A number of taxpayers were self‑represented and a number were represented
by counsel. Mr. Di Mauro represented himself. While only one of his
appeals had been set down for a status hearing, he made a joint request to the
Court to also address his other appeal which was in the general procedure,
which joint request was granted.
[2]
The Court first called the appeals where no one
had appeared for the appellants. The Court then called the appellants who only
had informal appeals pending. The Court then called the appeals where the
parties had already agreed to a schedule within which to complete pre‑hearing
steps that was ready to be submitted to the Court.
[3]
Following this, the remaining eight appeals were
called together so that a single approach was taken with each of them.
Mr. Di Mauro’s appeals were called at this time with the appeals of the
seven other Appellants. A common target timetable was first addressed and
established, following which Appellants for whom a target date did not work
were addressed and accommodated, and thereafter parties were allowed to address
individual concerns relating to readying their appeals for trial.
[4]
At this final stage, the Respondent asked that
Mr. Di Mauro please confirm on the record that, notwithstanding his notices
of appeal in this Court, he was now only appealing his assessment of penalties
and was abandoning his appeal relating to the tax assessed which denied his
claims to Fiscal Arbitrators deductions.
[5]
This required simply acknowledging that he had
already confirmed to the Federal Court of Appeal (“FCA”) when it
reinstated his appeals Di Mauro v. Canada, 2015 FCA 210, which had
been dismissed by this Court (Di Mauro v. The Queen,
October 25, 2013, 2012-3399(IT)I and 2012-4035(IT)G), and confirming that,
notwithstanding that he has not since then further amended his notices of appeal,
he was indeed now only appealing the penalties assessed. The Respondent’s
request was for confirmation that, notwithstanding he has not amended his notices
of appeal, he had not changed his mind from the day of the FCA hearing.
[6]
Instead, Mr. Di Mauro chose to selfishly
and manipulatively waste everyone’s time by deceitfully and smugly playing
games. A transcript of the relevant portions of his exchange with the Court is attached.
Prior to the Respondent’s counsel intervening to advise the Court of the
earlier proceedings before the FCA, Mr. Di Mauro went so far as to
state categorically to this Court that he had never intended to limit his
appeals to penalties. Mr. Di Mauro’s baseless, self‑indulging, nonsensical
performance went on for at least 20 minutes.
[7]
This Court has the power to award costs against
a party who proceeds in a manner that causes unnecessary delay. This is one of
the specifically enumerated considerations in Rule 147 of the Tax Court of
Canada Rules (General Procedure).
[8]
This Court has the power to award costs where a
party abuses the processes of the Court. See the FCA decision in Fournier v.
Canada, 2005 FCA 131, etc. There is nothing in the FCA’s
reasons in Brown v. Canada, 2014 FCA 301, or Di Mauro v.
Canada, 2015 FCA 210, which excludes appellants who are only
appealing penalties from being subject to the same considerations if they are
abusing process as any other party before the Court.
[9]
This is not a case where an appellant was only
wasting the time of the Court and the Respondent. Judges, registrars, court
reporters and Justice counsel are all paid to be in court listening to what an appellant
wants to say. Perhaps what Mr. Di Mauro did would not warrant a cost
award against him in such a case.
[10]
In this case, Mr. Di Mauro was
intentionally, and for his own purposes, wasting the time of seven other
Canadians whose status hearings had been called at the same time. Mr. Di Mauro’s
behaviour could not help advance the resolution of his appeals, nor was it
responsive to the question the Respondent had asked the Court to have him
answer or clarify. These seven other Canadians had other responsibilities and
things to do. They were taking time off work or were away from their business,
some were paying for their lawyers to be present, undoubtedly some were paying
for caregivers, and some were paying for parking in downtown Toronto’s financial
district by the half‑hour.
[11]
I apologized to these other Appellants on behalf
of the Court.
[12]
This Court also has the power to order costs
payable by or to an appropriate person who is not a party to the particular
appeal. See, for example, Justice Pizzitelli’s decision in Mariano v.
The Queen, 2016 TCC 161. I am satisfied that this is an
appropriate case for the cost award against Mr. Di Mauro to be
payable not to the other party, but to each of the other Appellants whose
hearings were called and being heard at the same time.
[13]
Mr. Di Mauro will be ordered to pay $50
in respect of costs to each of the other seven Appellants. These costs,
totalling $350, are payable within 30 days. These other Appellants are:
- Angela Stanley v. The Queen, 2014-4029(IT)I,
2012-3678(IT)G;
- Timothy Stanley v. The Queen, 2012-3565(IT)G;
- Marc Dupéré v. The Queen, 2011-2367(IT)G;
- Janet Frez v. The Queen, 2014-3865(IT)G;
- Yongwoo Kim v. The Queen, 2011-4095(IT)G, 2012-4057(IT)G;
- Layton Plummer v. The Queen, 2014-697(IT)G;
- Barbara Adjei v.
The Queen, 2013-1340(IT)I.
[14]
The total amount of $350 is to be paid to the
Court to be delivered to these Appellants. The Court has their addresses and
Mr. Di Mauro does not.
Signed
at Ottawa, Canada, this 21st day of October 2016.
“Patrick Boyle”
Transcript of the relevant portions of Mr. Di Mauro’s
exchange with the Court at the hearing of August 23, 2016:
. . .
JUSTICE
BOYLE: Anything else I can do this morning to help move this along or help you
understand what is being moved along?
MS.
BHIMJI: If I may?
JUSTICE
BOYLE: Yes.
MS.
BHIMJI: With respect to the Di Mauro appeal, if I can clarify for the record
what exactly is at issue, whether it is the penalty only, or if that includes
business losses?
JUSTICE
BOYLE: So if you can ask to have that clarified? Or if you can tell me...
clarify me?
MS.
BHIMJI: I am asking you if we can have that clarified for the Court, by the
Appellants, if they can put that on the record.
JUSTICE
BOYLE: Okay. Mr. Di Mauro?
MR.
DI MAURO: It’s already on the record, isn’t it? Is it not on record?
MS.
BHIMJI: Not...
MR.
DI MAURO: I am not clear what you wish to have clarified.
JUSTICE
BOYLE: Sorry?
MR. DI MAURO:
I am not clear what she... what... what the Respondent would like to have
clarified. I...
JUSTICE
BOYLE: Are you only appealing the penalties assessed, or are you also appealing
the denial of your claim for the tax deduction and refund?
MR.
DI MAURO: Well, given that you are putting that question to me now...
JUSTICE
BOYLE: I am not putting the question to you.
MR.
DI MAURO: Oh, sorry.
JUSTICE
BOYLE: You asked me what she was asking.
MR.
DI MAURO: Yes. Initially, I was appealing what gave rise to the penalties.
JUSTICE
BOYLE: Right.
MR.
DI MAURO: Okay? And if your Honour could clarify: If a matter is before the
Court on penalties, is that saying that the Notice of Assessment has been
partially agreed to? – because I am not very clear on what the intent of limiting
it to the penalties, if that is actually a segmentation process of... a
limiting process.
JUSTICE
BOYLE: Oh, it would be very much a limiting process.
MR.
DI MAURO: I’m sorry?
JUSTICE
BOYLE: So... it would be very much a limiting process. So I am not pulling out
your Notice of Appeal and looking at it, but I am taking it you objected in a
way that either intentionally or ambiguously has you objecting to both the tax
reassessment and the penalty assessment.
MR.
DI MAURO: Yes.
JUSTICE
BOYLE: And if you are only appealing the... you are only appealing whatever you
choose to appeal; the rest of the assessment is correct.
MR.
DI MAURO: I see.
JUSTICE
BOYLE: So if you only appealed the penalty at the outset, or you now limit
yourself to only the penalty, you are accepting the reassessment of the tax
deduction.
MR.
DI MAURO: That was never my intent.
JUSTICE
BOYLE: Okay.
MR.
DI MAURO: My intent on penalties is given the fact that the burden of proof on
penalties is on the Minister, then it is up to the Minister to produce the
support, the evidence, for their penalties.
JUSTICE
BOYLE: Right.
MR.
DI MAURO: In other words, we’re...
JUSTICE
BOYLE: But if you are objecting to both, then you’ve got the...
MR.
DI MAURO: May I finish, your Honour?
JUSTICE
BOYLE: Yes, certainly.
MR.
DI MAURO: They would be required to produce the evidence to support the
penalties and, ergo, what gave rise to the penalties. And everything that I
have seen within the act speaks to a false statement, what gives rise to the
false statement.
So
my suggestion is I don’t want it to be limited to the monetary aspect of the
Notice of Assessment but, in fact, what gave rise to the penalty in the first
place. In some manner, they are actually putting the business loss before the Court
because, if they can’t... and I don’t want to be stuck on that. Given some of
the latest information that I have looked at, I am actually prepared to... I am
in the position actually to defend both, at this point.
So
if it is a limiting aspect of the penalties...
JUSTICE
BOYLE: I am not sure what you are talking about when you say limiting aspect of
the penalties.
MR.
DI MAURO: Okay. On...
JUSTICE
BOYLE: So I am confused.
MR.
DI MAURO: Okay. Let me just draw your attention to... a Notice of Assessment
contains some numbers on it. One of them would be penalties.
JUSTICE
BOYLE: Right.
MR.
DI MAURO: If we take a literal view of the number, the penalty amount, on its
own, then it would indicate to the Respondent that there is some kind of
agreement as to the remaining part of the assessment, the other monetary part
of the assessment.
On
the other hand, if we broaden the objection of penalties to the broader scope
which is, if you cannot produce the... this is the point: If you cannot produce
the evidence, the burden of... if you can’t meet the burden of proof, on
penalties, then it must mean that the original filing was correct.
JUSTICE
BOYLE: No.
MR.
DI MAURO: That’s all I’m...
JUSTICE
BOYLE: See? There, you are just dead wrong, Sir.
MR.
DI MAURO: Okay.
JUSTICE
BOYLE: Okay?
MR.
DI MAURO: Well, that’s what I wanted to clarify.
JUSTICE
BOYLE: Okay.
MR.
DI MAURO: Because...
JUSTICE
BOYLE: It’s...
MR.
DI MAURO: ... all, this whole matter on penalties has gotten me confused, ergo,
because we seem to be focused on the monetary aspect...
JUSTICE
BOYLE: No, no. No, let’s...
MR.
DI MAURO: Okay.
JUSTICE
BOYLE: And, please, let me clarify.
MR.
DI MAURO: Okay.
JUSTICE
BOYLE: And there are some really simple things and there are some complicating
factors. But simply, a penalty is assessed separately from the tax. So they
deny your tax claim.
MR.
DI MAURO: Yes.
JUSTICE
BOYLE: And then they decide, do I or do I not assess a penalty as well. They
only assess a penalty where they think they can establish that you made a
misrepresentation in your return based on gross negligence, if not wilfully. So
it is sort of called a gross negligence penalty. They have to establish that;
they know that when they assess it.
But
just because they don’t assess a penalty, or if the Court decides that you
weren't grossly negligent, you were only moderately negligent, you were
reasonably negligent, you reasonably made a misstatement, it doesn’t mean you
get the taxes you wanted.
So
there are two distinct questions. So the assessment has, let’s call them tax,
which is reversing the deduction you claimed.
MR.
DI MAURO: Mm-hmm...
JUSTICE
BOYLE: It’s got interest to the date of assessment and it’s got a penalty, or
not, as the case may be. You’ve got the onus if you want to contest the tax or
interest; Crown’s got the onus if it's penalties.
So
if you’re contesting... if the Court ultimately decides penalty is not
appropriate, it doesn’t mean you win on the tax claim.
In
fact, the complicating aspect is because the taxpayer’s got the onus on the tax
claim, if you really think you are entitled to that deduction, then you’ve
essentially got to go first and give evidence, which gives... which can be
unhelpful to you in establishing whether you were grossly negligent or not on the
penalty.
MR.
DI MAURO: Mm-hmm...
JUSTICE
BOYLE: If you are only contesting the penalty, and not the tax...
MR.
DI MAURO: Right.
JUSTICE
BOYLE: ... you don’t have to go first because you don’t have a burden. You
still have to answer their questions on discovery, under oath. They can still
subpoena you, have you as a witness, but you are not the one who’s got the
first onus.
But
if you are contesting the tax, then the taxpayer is invariably going to go
first because if you can persuade the judge that you are entitled to the tax
deduction, we don’t even have to hear about the penalty.
MR.
DI MAURO: Right.
JUSTICE
BOYLE: The Crown was way off.
MR.
DI MAURO: Okay. There are two cases; one is the informal. That’s purely on
penalties. So I’ll remain on the penalties on that, because the tax was already
paid.
JUSTICE
BOYLE: Okay.
MR.
DI MAURO: That’s fine. And even though I attempted to withdraw it, way back
when, they didn’t want to, so...
So
on that, I will leave it at penalties. But under...
JUSTICE
BOYLE: Sorry? You attempted to withdraw it and they didn’t want to? Who didn’t
want to? Is that the Court didn’t let you withdraw your informal?
MR.
DI MAURO: The CRA didn’t want to withdraw it; it actually sent a... it was
based on a tax adjustment going back to nineteen-ninety-...
JUSTICE
BOYLE: Okay. So it was more of a settlement discussion...
MR.
DI MAURO: For a settlement discussion...
JUSTICE
BOYLE: ... not an outright withdrawal by you?
MR.
DI MAURO: Well, it was an outright withdrawal, because I had put in a few
more...
JUSTICE
BOYLE: Only if they did something.
MR.
DI MAURO: Yes. No, I had put in...
JUSTICE
BOYLE: So that is not outright, right?
MR.
DI MAURO: I had put in an adjustment and then they said, “We are not buying
that.”
JUSTICE
BOYLE: Okay.
MR.
DI MAURO: “So we are going to charge you a penalty.”
JUSTICE
BOYLE: Okay.
MR.
DI MAURO: And I said, “Well, why not just withdraw it? I mean, what’s the big
deal, right?” The tax was already paid. And that’s why we are here on that matter.
So I will stay with the penalties on that matter.
JUSTICE
BOYLE: Okay. So, on your informal...
MR.
DI MAURO: Informal...
JUSTICE
BOYLE: ... It’s penalties only.
MR.
DI MAURO: Penalties only.
JUSTICE
BOYLE: Okay. And on your general procedure?
MR.
DI MAURO: On the general, I would like to put before the Court the losses.
JUSTICE
BOYLE: Okay. Let me just...
MR.
DI MAURO: The deduction.
JUSTICE
BOYLE: ... Pull your ...
MR.
DI MAURO: Expense deduction, whatever.
JUSTICE
BOYLE: ... file, Mr. Di Mauro. So I’ve...
MR.
DI MAURO: That’s really what I want to do.
JUSTICE
BOYLE: You’ve got your general... and I’ve got two of yours, but they are... no,
no, they are both labelled for the same... in the informal. And is this the
general we haven’t called yet?
MR.
DI MAURO: It’s the general you haven’t called yet, yes.
JUSTICE
BOYLE: Okay. So you’re okay talking about it and getting it resolved, pretrial?
MR.
DI MAURO: Yes.
JUSTICE
BOYLE: Okay, great.
MR.
DI MAURO: Yes.
JUSTICE
BOYLE: I am not sure why it wasn’t called, but I think that means I don’t have
the file in front of me and you don’t have the file here, either.
Do
either of you have a copy of the Notice of Appeal I can look at, in that? And
if only to let the Registrar call the matter, so we are properly talking about
it?
MS.
BHIMJI: No. We only have the informal file with us because I just thought of
the general this morning.
JUSTICE
BOYLE: Okay.
MS.
BHIMJI: Sorry.
JUSTICE
BOYLE: We do have the file number? Okay.
MS.
BHIMJI: I have the file number, yes.
JUSTICE
BOYLE: Okay. So we can call it, then.
THE
REGISTRAR: Okay. Calling file No. 2012-4035(IT)G, between Alexander Di Mauro,
the Appellant v. Her Majesty the Queen, the Respondent. The Appellant is
appearing on his own behalf and, for the Respondent, we have Ms. Rishma Bhimji.
JUSTICE
BOYLE: Thank you. So now we are talking about the informal and the general,
officially.
MR.
DI MAURO: And I really appreciate your Honour clarifying the process. So...
JUSTICE
BOYLE: Do you have your Notice of Appeal in your general with you? No? Okay.
MR.
DI MAURO: No, I didn’t bring anything with me, because I...
JUSTICE
BOYLE: Okay.
MR.
DI MAURO: Things are in a little disarray.
JUSTICE
BOYLE: Ms. Bhimji?
MR.
DI MAURO: I was just expecting to have the dates today.
JUSTICE
BOYLE: No, that’s okay. Ms. Bhimji?
MS.
BHIMJI: If I may, I just wanted to... so the reason I wanted to clarify this
for the Court is because we have actually had to clarify this before and we
have gone to the Federal Court of Appeal and now we are back, and we are
getting...
JUSTICE
BOYLE: Do I have a history on this file? The name sounds familiar, that’s all,
but...
MS.
BHIMJI: Alexander Di Mauro...
JUSTICE
BOYLE: ... It could just be...
MS.
BHIMJI: No. With this?
JUSTICE
BOYLE: Okay.
MS.
BHIMJI: Not... no. You weren’t.
JUSTICE
BOYLE: Okay.
MS.
BHIMJI: We haven’t been in front of you. But I wanted to give you the Federal
Court of Appeal judgment so that you can take a look at it.
JUSTICE
BOYLE: In this general procedure case?
MS.
BHIMJI: In both. It was both the informal and the general.
JUSTICE
BOYLE: So when I am reading the Federal Court of Appeal, Justice Webb writes:
“The Appellant confirmed at the hearing of
this appeal that he is now restricting his appeal to the striking of the parts
of his Notices of Appeal...
... so in both...
... related to the assessment of penalties
under subsection 163(2).”
. . .
So,
based on that, the Court of Appeal reinstated the prior striking of your
appeals. So they have only reinstated it on the basis that you have told the
Court of Appeal that you were restricting both to penalties.
MR.
DI MAURO: Well, that’s why I was confused by the Respondent’s position on
clarifying what I wanted to do. It’s... to me, it sounds like do I still have
an option...
JUSTICE
BOYLE: Then why were you just playing games with me...
MR.
DI MAURO: I am not, Sir.
JUSTICE
BOYLE: ... and everybody else for the last half hour, Sir?
MR.
DI MAURO: I... I am not, your Honour. I am not. She...
JUSTICE
BOYLE: No. The question was very clear...
MR.
DI MAURO: Yes.
JUSTICE
BOYLE: ... from Ms. Bhimji...
MR.
DI MAURO: Yes.
JUSTICE
BOYLE: ... and your first was the rhetorical question, “I have already answered
that, why am I having to?” I take you at face value and ignore the apparent
rhetoric, and we have carried on for 20 minutes, Sir, going full circle, to you
saying, “Well, of course I knew I did that. That’s why I said at the outset, I
didn’t understand the question.”
MR.
DI MAURO: I don’t understand...
JUSTICE
BOYLE: Really?
MR.
DI MAURO: ... why you’re upset at me.
JUSTICE
BOYLE: Yes, I am.
MR.
DI MAURO: But she raised it. Ms. Bhimji raised...
JUSTICE
BOYLE: No. Ms. Bhimji had a question...
MR.
DI MAURO: For me to clarify...
JUSTICE
BOYLE: ... that you answered rhetorically, that I gave you the benefit of the
doubt and assumed you would not behave this way, Mr. Di Mauro,
because I give all Canadians that benefit of the doubt, even ones who have
appeared in front of me before.
MR.
DI MAURO: But...
JUSTICE
BOYLE: Everybody wakes up a new day and maybe a changed person.
MR.
DI MAURO: Your Honour, I was not intending to... in... you know, to...
JUSTICE
BOYLE: Well, let’s end...
MR.
DI MAURO: ... upset the Court.
JUSTICE
BOYLE: ... it here.
MR.
DI MAURO: What...
JUSTICE
BOYLE: It’s not me. I am looking out at a whole bunch of Canadians who have
better things to do than listen to this nonsense. It’s them that I feel for, Sir.
It’s the Registrar’s job, it’s Ms. Bhimji’s job, it’s my job. They are
Canadians with other things to do: kids to take care of, jobs to run,
businesses to run, probably serving you at times. And you have no respect for
them.
So...
MR.
DI MAURO: May I...
JUSTICE
BOYLE: ... Is there anything else on this, Ms. Bhimji? Because it is
clear that there is no doubt that his appeals have been restricted; that is the
only reason they are still around.
MS.
BHIMJI: No.
JUSTICE
BOYLE: Okay.
MS.
BHIMJI: I have nothing further on this.
. . .
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