[1] These appeals involve the question of whether, on an appeal to this Court from the Tax Court that originated in the Informal Procedure but was transferred on the application of the Crown to the General Procedure, Robert Furukawa is entitled to solicitor and client costs in this Court.

[2] There is no doubt that, under section 18.25 of the Tax Court of Canada Act, R.S.C. 1985, c. T-2, if the proceedings had remained under the Informal Procedure in the Tax Court and the Crown appealed, Mr. Furukawa would have been entitled to an award of costs on a solicitor and client basis. Mr. Furukawa says he should not be denied solicitor and client costs on an appeal to this Court by the Crown. The proceedings in the Tax Court were initiated by Mr. Furukawa in the Informal Procedure and were transferred to the General Procedure on the application of the Crown.

[3] In the original appeal in Court File A-412-96 (now Court File A-187-02), Mr. Furukawa did not ask for solicitor and client costs and the reasons for order of this Court simply read: "The respondent (Mr. Furukawa) shall have his costs of this appeal".

[4] There is no indication that this Court intended anything other than party party costs. Mr. Furukawa does not say that anything in the Act fetters the discretion of this Court to award costs in an appeal from proceedings under the General Procedure.

[5] In these circumstances, we see no basis for interfering with the discretion exercised by this Court in awarding party party costs and we would dismiss the appeal. The party party costs in favour of Mr. Furukawa in that appeal shall be fixed at $7,500, inclusive of fees, disbursements and GST.

[6] In the original appeal in Court File A-80-99 (now Court File A-189-02), Mr. Furukawa did ask for solicitor and client costs and the reasons for judgment state that: "Mr. Furukawa shall receive the reasonable and proper costs incurred in successfully prosecuting this appeal". In the context of applications for judicial review from the Tax Court, the words "reasonable and proper costs" have been interpreted to mean solicitor and client costs. See The Queen v. Creamer (1977), 77 D.T.C. 5025 at 5030 (F.C.T.D.).

[7] These were the words used in the reasons of the Court in this case. It is true that the judgment itself only refers to the appeal being dismissed "with costs". However, the Crown agrees that the judgment is properly informed by the reasons. Therefore, in this case, it is apparent that the Court intended to award what Mr. Furukawa requested, namely, solicitor and client costs.

[8] We assume that the Court exercised its discretion to award solicitor and client costs by taking into account that these proceedings started in the Informal Procedure and were transferred to the General Procedure on the application of the Crown. There is no suggestion of misconduct or any other reason for awarding solicitor and client costs.

[9] We would allow the appeal in Court File A-189-02 and would fix solicitor and client costs in favour of Mr. Furukawa at $27,000, inclusive of fees, disbursements and GST.

[10] In view of the divided success, as between the appeals in Court Files A-187-02 and

A-189-02, there will be no award of costs on these appeals.

"Marshall Rothstein"

J. A.

FEDERAL COURT OF APPEAL

NAMES OF COUNSEL AND SOLICITORS OF RECORD

DOCKET: A-187-02 & A-189-02

STYLE OF CAUSE: ROBERT B. FURUKAWA v. THE QUEEN

PLACE OF HEARING: Calgary, Alberta

DATE OF HEARING: April 3, 2003

REASONS FOR JUDGMENT

OF THE COURT: (Rothstein, Evans & Malone JJ.A.)

RENDERED FROM THE

BENCH BY: Rothstein J.A.

APPEARANCES:

Mr. Michel Bourque FOR THE APPELLANT

Mr. Louis A.T. Williams FOR THE RESPONDENT

SOLICITORS OF RECORD:

BENNETT JONES LLP, Calgary, Ab. FOR THE APPELLANT

Morris A. Rosenberg

Deputy Attorney General of Canada FOR THE RESPONDENT

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Furukawa v. Canada, 2003 FCA 183

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2003 FCA 183