Anand – Tax Court of Canada accepts oral evidence that the parties' written contract did not reflect their contractual intent

CRA assessed an individual (“Anand”) on the basis that he had provided services as a general contractor for the construction of a new home (so that he should have charged HST on the full cost to the landowning couple (Dr. Gupta and Dr. Khanna) rather than merely providing services as a construction manager for a fee of $50,000 per year. CRA relied on a contract which had been drafted by Dr. Gupta, perhaps using a template he found on the internet.

Hogan J accepted the oral testimony of Anand and Dr. Gupta that the written contract did not reflect their contractual intent. Such parol evidence could be admitted since there were significant inconsistencies in the contract’s drafting amounting to “patent ambiguity.” Even if there had been no such patent ambiguity, Hogan J might have been prepared to come to the same result on the basis that “latent ambiguity” arose from the “factual matrix” surrounding the contract.

Thus the services of the various trades were received by Anand as agent for the couple.

Neal Armstrong. Summary of Anand v. The Queen, 2019 TCC 119 under General Concepts – Evidence.