Date: 20031029
Docket: A-624-02
Citation: 2003 FCA 404
CORAM: NOËL J.A.
SEXTON J.A.
MALONE J.A.
BETWEEN:
DAVE PERLMUTTER
Appellant
and
HER MAJESTY THE QUEEN
Respondent
Heard at Ottawa, Ontario, on October 28, 2003.
Judgment delivered at Ottawa, Ontario, on October 29, 2003.
REASONS FOR JUDGMENT BY: NOËL J.A.
CONCURRED IN BY: SEXTON J.A.
MALONE J.A.
Date: 20031029
Docket: A-624-02
Citation: 2003 FCA 404
CORAM: NOËL J.A.
SEXTON J.A.
MALONE J.A.
BETWEEN:
DAVE PERLMUTTER
Appellant
and
HER MAJESTY THE QUEEN
Respondent
REASONS FOR JUDGMENT
NOËL J.A.
[1] This is an appeal from a decision of Lamarre T.C.J. in which she concluded that the reassessments issued with respect to the appellant's 1991, 1992, 1993 and 1994 taxation years did not breach a plea bargain agreement reached between the appellant and the Canada Customs and Revenue Agency (CCRA).
[2] According to the appellant, this agreement settled more than the 22 counts of tax evasion with which he was charged. Specifically, he alleges that the plea bargain agreement resulted in a full and final settlement of his civil tax liability in consideration for a further payment of $150,000, which amount was paid in full a few days after sentencing.
[3] The Tax Court Judge came to the conclusion that no such agreement had been reached. She noted in her reasons that the appellant's case was presented in a very confusing way (reasons, paragraph 2). She went on to set out her understanding of the evidence surrounding the plea bargain agreement (reasons, paragraphs 3 to 20) before concluding that "at no time was there complete and full agreement with respect to the settlement of the appellant's income tax liability" (reasons, paragraph 43).
[4] The appellant contends that the Tax Court Judge made a palpable error in holding that his civil tax liability had not been finally settled. According to him the only uncertainty which remained after the plea bargain agreement related to the exact amount which was to be paid up to a maximum of $150,000. In the end, the maximum amount was the amount paid and the Tax Court Judge made a reviewable error when she held that this payment did not finally settle his civil tax liability.
[5] In order to succeed, it was incumbent upon the appellant to show that the conclusion reached by the Tax Court Judge was not open to her having regard to the evidence presented before her. In my view, this demonstration has not been made.
[6] In reaching her conclusion, the Tax Court Judge considered the examination and cross-examination of Bruce Engle, the appellant's counsel in the criminal proceedings. She also considered Mr. Engle's representations during the criminal proceedings.
[7] While Mr. Engle testified that the payment was to be "no more that $150,000", he also acknowledged that "there was uncertainty with respect to the $150,000" and that Revenue Canada was to "review everything" (reasons, paragraph 34). Mr. Engle also testified that the appellant's accountant, Mr. Steve Saslove, was mandated "to resolve these amounts" (reasons, paragraph 35). The Tax Court Judge notes in her reasons that Mr. Saslove was not called to testify (reasons, paragraph 40).
[8] The Tax Court Judge also emphasized Mr. Engle's statement during the criminal proceedings to the effect that there was "a verbal commitment with respect to the $150,000 owing or whatever that amount - which should be determined later this week, ..." (reasons, paragraph 36).
[9] The uncertainty surrounding the plea bargain agreement was not restricted to the appellant's side of the bargain. Ms. Huppé-Cranford who testified on behalf of the CCRA was asked whether she was able to shed light on this agreement. Her response is quoted at paragraph 40 of the Tax Court Judge's reasons:
I tried. I must say that it was very difficult, because Mr. Perlmutter would have different ways of explaining it from one time to another, for one thing. For another thing, there was nothing written. And I did meet with Special Investigations on one occasion and they also had mixed ideas of what the actual understanding was. So I had two parties that had different ideas of what this plea bargaining was and what exactly it entailed.
[10] That is the evidentiary context in which the Tax Court Judge found as a fact that a full and complete settlement had not been reached in the present case. Despite the appellant's forceful agreement that the Tax Court Judge ought to have confirmed the existence of a final agreement, I am unable to hold that the conclusion which she reached was not open to her on the evidence.
[11] On a related issue, the appellant contends that cheques from the Régie d'assurance maladie du Québec (RAMQ) were wrongly excluded from the calculation of his income for the relevant period. The issue here is whether the appellant did, or did not, opt to have these cheques excluded from the computation of his income during the negotiations pertaining to his civil tax liability.
[12] The Tax Court Judge did not give effect to the appellant's contention that the RAMQ cheques were not to be excluded. In this respect, she was obviously relying of Ms. Huppé-Cranford's testimony at trial to the effect that the appellant had agreed to exclude the RAMQ cheques. This testimony was corroborated by notes which Ms. Huppé-Cranford had taken from a conversation which she had with the appellant on July 5, 2000 (Appeal Book, page 123) as well as her letter to the appellant on the same date outlining both parties' agreement to the exclusion of the cheques (Appeal Book, page 63). There is no evidence on the record of any response by the appellant taking issue with the contents of this letter.
[13] In my view, the Tax Court Judge was on solid ground in not giving effect to the appellant's contention that he had not opted to exclude the RAMQ cheques.
[14] Lastly, the appellant contends that the CCRA made a mathematical error in the computation underlying the reassessments. According to the appellant, the correct figure under "payment made" in the formula used to compute his refund was $778,405 rather than $739,960 with the result that he should be entitled to a refund of $261,566 rather than $222,970. The Tax Court Judge made no determination on this point.
[15] I have reviewed the formula in question and am unable to give effect to the appellant's contention. Specifically, it is apparent that, on calculations advanced by the respondent (see paragraphs 26 to 28 of the respondent's memorandum), whether the correct figure under "payment made" is $739,960 or $778,405, the appropriate ratio in each case (74% and 79.5% respectively) provides for a refund of essentially the same amount.
[16] I would dismiss the appeal with costs.
"Marc Noël"
J.A.
"I agree.
J. Edgar Sexton J.A."
"I agree.
B. Malone J.A."
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