Kempo,
T.C.C.J.:—The
matter
of
the
taxation
of
the
successful
appellants’
costs
on
a
party-and-party
basis
was
heard
pursuant
to
Rule
13(6)
of
the
Tax
Court
of
Canada
Rules
of
Practice
and
Procedure
for
the
Award
of
Costs
(Income
Tax
Act)
(hereafter
called
the
"Rules").
Counsel
for
the
appellants
has
filed
its
bill
of
costs
thusly:
A.
For
services
of
counsel
I
claim
the
following:
|
(a)
preparation
of
notice
of
appeal:
|
|
$
|
75
|
|
(b)
preparation
for
hearing:
|
|
$
|
175
|
|
(c)
conducting
the
hearing
(16
days
@
$125
per
half
day
or
part
|
|
|
thereof):
|
|
$
2,000
|
|
(d)
taxation
of
costs:
|
|
$
|
50
|
|
B.
For
witnesses'
fees
I
claim
the
following:
|
|
|
For
the
services
of
Mr.
H.
Jung
C.A.
in
preparing
for
and
giving
|
|
|
testimony
at
trial:
|
|
$
8,750
|
|
(attached
are
receipts
and
other
supporting
documents)
|
|
|
C.
For
expert
witnesses
I
claim
the
following:
|
|
|
D.C.
Selman,
F.C.A.
|
|
|
(i)
services
rendered
after
notice
of
appeal
towards
|
|
|
preparation
for
trial:
|
$8,145
|
|
|
(ii)
time
spent
preparing
for
and
giving
evidence
at
|
|
|
trial:
|
$6,700
|
|
|
TOTAL:
|
|
$14,845
|
|
(attached
are
receipts
and
other
supporting
|
|
|
documents)
|
|
|
D.
Other
Disbursements
|
|
|
Transcripts
ordered
from
Allwest
Reporting
Ltd.
|
|
|
($458.90
plus
$1081.10):
|
$1,540.00
|
|
|
Photocopying:
|
$
499.05
|
|
|
Postage:
|
$
|
3.12
|
|
|
Long
Distance
Telephone
Calls
|
$
|
65.09
|
|
|
Courier/Deliveries:
|
$
|
21.75
|
|
|
Telecopier
|
$
209.00
|
|
|
TOTAL
DISBURSEMENTS:
|
|
$
2,338.01
|
|
(attached
are
receipts
and
other
supporting
|
|
|
documents)
|
|
|
Goods
and
Services
Tax
of
7%
(on
disbursements
|
|
|
incurred
from
January
1991)
|
$
|
9.95
|
|
TOTAL
COSTS:
|
$28,242.96
|
All
items
were
disputed
by
counsel
for
the
respondent
with
the
exception
of
sub-items
(a),
(b)
and
(d)
in
item
A.
These,
therefore,
are
allowable
in
their
respective
amounts
as
claimed.
In
my
view
item
A(c)
is
allowable
in
the
amount
of
$2,000
as
claimed.
The
last
half
day,
while
brief,
represented
a
"part
thereof"
as
per
Rule
8(2)(c).
The
following
portions
of
Rule
8
are
applicable
to
the
remaining
items.
Party
and
Party
Costs
8(1)
This
section
applies
to
the
taxation
of
party
and
party
costs
where
an
appellant
is
entitled
to
them.
(3)
Such
disbursements
may
be
allowed
as
were
essential
for
the
conduct
of
the
appeal,
including
witness
fees
paid
in
accordance
with
subsection
(4)
or
(5).
(4)
A
witness,
other
than
a
witness
who
appears
to
give
evidence
as
an
expert,
is
entitled
to
be
paid
by
the
party
who
arranged
for
his
attendance
$15
per
day,
plus
reasonable
and
proper
transportation
and
living
expenses,
or,
if
it
is
larger,
the
fee
or
allowance
in
similar
circumstances
in
a
superior
court
of
the
province
where
the
witness
appears.
(5)
There
may
be
paid
to
a
witness
who
appears
to
give
evidence
as
an
expert
a
reasonable
payment
for
the
services
performed
by
the
witness
in
preparing
himself
to
give
evidence
and
in
giving
evidence.
For
convenience,
I
will
next
deal
with
appellants’
items
claimed
in
paragraph
D
entitled
Other
Disbursements”.
Counsel
for
the
appellants,
William
Ruskin,
filed
his
affidavit
in
support
of
the
bill
of
costs.
Item
D:
Transcripts
In
my
view
the
claimed
amount
of
$1,540
is
allowed
as
two
unavoidable
extended
time
periods
passed
between
court
appearances.
These
disbursements
were
necessary
and
reasonable
for
the
conduct
of
the
appeal
throughout.
Item
D:
Balance
of
the
items
The
notice
of
appeal
was
dated
April
26,
1989.
Mr.
Ruskin's
account,
Exhibit
"C"
to
his
affidavit,
is
dated
April
28,
1989.
The
description
of
the
legal
services
therein
obviously
includes
pre-appeal
services.
It
fails
to
tie
in
the
disbursements
of
$26.70
for
copy
work,
$21
for
telecopier
charges
and
$5.25
for
delivery
charges
with
the
commencement
of
the
appeal
and
the
time
thereafter
and
therefore
they
are
not
allowed.
The
following
amounts
in
the
bill
of
costs
have
been
shown
to
be
and
are
allowable
as
being
necessary
and
reasonable
for
the
conduct
of
the
hearing:
The
matter
of
photocopying
in
the
total
amount
of
$499.05
is
problematical.
The
sum
of
$26.70
is
taxed
off
as
aforenoted.
The
balance
is
accounted
for
by
billings
to
the
appellants
on
November
20,
1989
for
$9.30,
May
25,
1990
for
$215,
September
13,
1990
for
$80.40,
December
11,
1990
for
$25.90
and
January
28,
1991
for
$141.75
plus
$9.95
GST
thereon,
all
without
any
explanation
as
to
subject
matter,
number
of
pages,
rate
per
page
and
whether
the
amounts
included
costs
attributable
to
the
law
firm's
overhead.
In
the
case
of
AMFAC
Foods
Inc.
and
McCain
Foods
Ltd.
v.
Irving
Pulp
and
Paper
Ltd.,
dated
December
9,
1985
(unreported),
court
file
T-166-80,
Dubé,
J.
of
the
Federal
Court,
Trial
Division,
after
referring
to
two
previous
decisions
of
the
Court
on
this
subject,
said
at
page
8:
|
Postage
(in
full)
|
$
3.12
|
|
Long
distance
calls
(in
full)
|
$65.09
|
|
Courier/delivery
($5.25
taxed
off)
|
$16.50
|
It
would
appear
that
the
general
rule
is
that
disbursements
for
photocopies
are
allowable
when
same
are
contracted
out:
the
amounts
actually
paid
by
the
firm
are
recoverable.
In-house
photocopying,
as
in
the
present
instance,
is
considered
to
be
included
in
the
legal
firm’s
overhead
and
not
taxable.
Under
the
circumstances,
the
taxing
officer
was
not
in
error.
In
that
case
the
taxing
officer
had
disallowed
the
claim
in
toto.
There
being
no
distinguishable
particulars
here,
the
entire
amount
of
$499.05
plus
the
$9.95
for
GST
charges
claimed
for
photocopying
are
not
allowed
for
the
same
reasons.
The
telecopier
item
of
$209
has
not
been
particularized
thus
precluding
a
discretionary
finding
that
it
was
a
necessary
and
reasonable
disbursement
incurred
for
the
conduct
of
the
appeal.
Accordingly
the
full
amount
of
$209
for
telecopying
is
not
allowed.
Item
B:
The
accountant
witness,
Mr.
H.
Jung,
C.A.
—
$8,750
This
was
advanced
under
Rule
8(3)
as
being
a
disbursement
essential
(i.e.,
being
reasonable
and
necessary)
for
the
conduct
of
the
appeal.
No
corroboration
has
been
provided
to
establish
that
this
account
has
been
paid
apart
from
the
scripted
notation
thereon.
The
invoice
was
drawn
on
the
letterhead
of
Jung
&
Lee,
Chartered
Accountants
and
it
reads:
October
16,
1990
MTC
Electronic
Technologies
Co.
Ltd.
2580
Viscount
Way
Richmond,
B.C.
V6V
2G8
FOR
PROFESSIONAL
SERVICES
RENDERED:
With
respect
to
meetings
with
Mr.
Miko
Leung
regarding
various
tax
matters.
With
respect
to
meetings
with
Mr.
Bill
Ruskins
and
Mr.
Miko
Leung
regarding
tax
reassessments.
With
respect
to
meetings
with
Don
Selman
regarding
valuation
of
company.
With
respect
to
appearance
at
Tax
Court
of
Canada.
Our
fee
$8,750
As
noted
by
respondent's
counsel,
it
is
not
addressed
to
the
appellants,
and
its
proof
of
payment
is
not
what
one
would
normally
expect
of
a
professional
chartered
accountant.
Additionally,
apart
from
the
last
line,
the
description
of
the
services
being
billed
for
does
not
accord
with
the
requirement
of
the
rule
that
the
services
are
to
be
reasonable
and
necessary
for
the
conduct
of
the
appeal.
The
appellants’
"tax
matters"
and
“tax
assessments",
and
Mr.
Jung's
“meetings
with
Don
Selman
regarding
valuation”
had
also
occurred
prior
to
the
appeal
being
launched.
The
billing
date
in
and
of
itself
does
not
resolve
this
matter.
Neither
does
Mr.
Jung's
professional
involvement
throughout
the
appeal
and
trial
process
in
assisting
counsel
in
the
preparation
of
the
case
necessarily
in
and
of
itself
justify
a
resolution.
The
respondent
is
entitled
to
know,
within
a
reasonable
certainty,
what,
and
why,
and
at
what
rate
it
is
called
upon
to
pay
the
appellants’
out
of
pocket
expenses
incurred
as
a
result
of
its
successful
outcome
of
the
trial.
Mr.
Jung’s
account,
as
drawn
and
presented,
blatantly
disregards
the
respondent's
entitlement
to
be
informed
and
reasonably
assured
that
it
is
reimbursing
the
appellants
for
disbursements
incurred
and
paid
for
and
in
the
course
of
the
appeal.
I
decline
to
exercise
my
discretion
to
apply
Rule
8(3)
as
requested.
Rule
8(4)
is
applicable.
As
no
particulars
were
submitted
in
this
respect,
no
award
for
costs
is
calculable
on
this
item.
The
claimed
amount
of
$8,750
is
not
allowed.
Item
C.
The
expert
witness,
D.C.
Selman,
F.C.A.
—
$14,845
The
corroborative
billings
were
thusly:
June
4,
1990
Clark
Wilson
Barristers
&
Solicitors
800-885
West
Georgia
Street
Vancouver,
B.C.
V6C
3H1
Attention:
Mr.
William
A.
Ruskin
TO
PROFESSIONAL
SERVICES
RENDERED:
M.N.R.
v.
M.
Leung
et
al.
Services
rendered
to
May
19,
1990,
in
reviewing
Minister's
valuation,
preparation
of
analysis
and
various
responses,
discussions
with
counsel
and
attending
hearing.
Our
fee:
$8,145
September
14,
1990
Clark
Wilson
Suite
800
885
West
Georgia
Street
Vancouver,
B.C.
V6C
3H1
Attention:
Mr.
Ruskin
For
services
rendered
in
assisting
in
preparation
for
trial
and
appearing
as
expert
witness
before
Tax
Court
of
Canada
on
behalf
of
Mona
Electronics.
Our
fee:
$6,700
Appellants'
counsel
advised
the
Court
that
respondent's
counsel
had
requested
and
was
provided
with
an
itemization
of
the
hours
and
hourly
rate
included
in
these
billings.
Particulars
thereof
were
drawn
up
and
included
as
an
exhibit
in
Mr.
Ruskin's
affidavit.
It
reads:
[Chart
not
reproduced.]
The
February-May
time
frame
relates
to
the
two
hearing
days
of
May
16
and
May
17,
1990
which
had
been
set
aside
for
the
hearing
of
the
whole
case.
After
a
day
and
one-half
of
hearings
concerning
another
issue,
there
was
no
time
left
to
commence
and
conclude
the
evidentiary
aspect
concerning
the
valuation
matter.
The
latter
occurred
during
August
28
to
31
inclusive
of
1990.
This
situation
required
Mr.
Selman
to
prepare
himself
twice
to
give
evidence.
He
was
in
court
to
testify
on
May
16
and
17.
He
did
testify
on
August
28
and
29
and
for
one-half
day
on
the
30th.
He
remained
for
rebuttal
for
the
rest
of
the
30th
and
all
of
the
31st.
Accordingly,
Mr.
Selman's
actual
court
time
during
August
was
at
least
six
hours
per
day
for
four
days
for
a
total
of
24
hours,
leaving
nine
hours
for
preparation
time
which
is
reasonable.
At
first
blush
it
appeared
that
because
there
were
34.75
hours
billed
respecting
the
May
trial
dates,
and
33
hours
billed
respecting
August,
there
may
have
been
some
unnecessary
duplication
of
time
or
services.
Obviously
this
could
not
be
so
as
the
two
days
in
May
would
realistically
encompass
12
hours
leaving
12.75
hours
for
preparation.
This
is
reasonable
given
the
complexity
of
the
valuation.
The
hourly
rate
throughout
the
1990
period
is
also
reasonable.
No
particulars
were
provided
with
respect
to
Mr.
Selman's
"associate"
item
for
seven
hours
at
$135
per
hour
totalling
of
$945,
nor
of
his
“secretarial
and
expense"
item
of
$250,
nor
was
there
any
corroborative
information
linking
those
services
to
the
preparation
and/or
giving
of
Mr.
Selman’s
expert
evidence.
These
two
amounts
are
not
allowed.
I
find
that
the
Selman
account
of
$6,950
representing
the
period
February-
May
1990
and
of
$6,700
for
August
1990,
both
totalling
$13,650,
are
allowed
as
a
reasonable
and
necessary
payment
made
for
his
services
as
the
appellants’
expert
witness
in
preparing
himself
to
give
evidence
and
in
giving
evidence.
Conclusion
Costs
are
allowed
as
follows:
|
Item
A:
all
allowed
|
$
2,300.00
|
|
Item
B:
all
taxed
off
|
nil
|
|
Item
C:
(i)
$1,195
taxed
off
|
6,950.00
|
|
(ii)
all
allowed
|
6,700.00
|
|
Item
D:
(i)
transcripts
all
allowed
|
1,540.00
|
|
(ii)
photocopying
—
all
taxed
off
|
nil
|
|
(iii)
postage
all
allowed
|
3.12
|
|
(iv)
telephone
all
allowed
|
65.09
|
|
(v)
courier/delivery
—
$5.25
taxed
off
|
16.50
|
|
(vi)
telecopier
—
all
taxed
off
|
nil
|
|
Total
Bill
of
Costs
of
the
Appellants
is
taxed
and
allowed
at
|
$17,574.71
|
Order
accordingly.
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