Lamarre
Proulx,
T.C.C.J.:—This
motion
was
heard
on
common
evidence
with
the
motion
of
Guy
Ménard
(90-1923(IT)).
This
is
a
motion
requesting
that
the
reply
to
the
notice
of
appeal
not
be
allowed
to
be
filed
and
that
the
appeal
be
disposed
of
on
the
basis
that
the
facts
alleged
in
the
notice
of
appeal
are
true.
The
provisions
that
are
of
application
in
the
present
case
are
sections
6,
7
and
8
of
the
Tax
Review
Board
Rules
(the
“
Rules”).
I
quote
them:
6.(1)
The
Minister
of
National
Revenue
shall,
within
sixty
days
from
the
day
on
which
the
Board
has
transmitted
to
him
a
notice
of
appeal
pursuant
to
the
provisions
of
section
170
of
the
Income
Tax
Act,
R.S.C.
1952,
c.
148
(am.
S.C.
1970-71-72,
c.
63)
(the
"Act"),
file
with
the
Registrar
of
the
Board
a
Reply
to
the
notice
of
appeal.
(2)
The
Minister
of
National
Revenue
shall
(a)
in
the
reply
to
a
notice
of
appeal
admit
or
deny
the
facts
alleged
in
the
notice
of
appeal
and
allege
any
further
facts
upon
which
he
intends
to
rely;
and
(b)
at
the
same
time,
serve
on
the
appellant
by
registered
mail
a
copy
of
the
reply.
7.
If
no
reply
to
a
notice
of
appeal
has
been
filed
within
sixty
days
from
the
date
on
which
the
Registrar
of
the
Board
has
transmitted
the
notice
of
appeal
to
the
Minister
of
National
Revenue,
the
appellant
may
make
an
application
to
the
Registrar
to
have
the
appeal
entered
on
the
list
of
appeals
to
be
called
for
hearing
at
the
next
sitting
of
the
Board
in
the
appellant's
district
and,
upon
the
making
of
such
application,
no
Reply
shall
thereafter
be
filed
without
leave
of
the
Board.
8.
Where
no
reply
to
a
notice
of
appeal
has
been
filed,
the
Board
may
dispose
of
the
appeal
on
the
basis
that
the
allegations
of
fact
contained
in
the
notice
of
appeal
are
true.
Facts
The
appeal
was
filed
on
July
20,
1990.
According
to
the
appellant's
affidavit,
the
facts
therein
were
not
challenged,
copy
of
the
notice
of
appeal
was
sent
by
the
Court
to
the
respondent
on
July
31,
1990.
To
continue
the
description
of
the
facts
pertinent
to
this
motion,
I
will
reproduce
parts
of
the
affidavit
which
was
filed
with
the
motion:
5.
On
September
7,
1990,
Revenue
Canada,
Taxation
forwarded
prescribed
documents
to
the
Tax
Court
of
Canada.
6.
On
September
21,
1990,
the
Department
of
Justice
acknowledged
receipt
of
instructions
to
represent
the
Minister
of
National
Revenue
and
indicated
that
a
Reply
to
the
notice
of
appeal
would
be
forwarded
in
the"
near
future”.
7.
On
September
24,
1991,
some
fourteen
months
after
the
notice
of
appeal
was
filed,
the
Tax
Court
of
Canada,
on
its
own
initiative,
set
the
Appeal
down
for
hearing
in
December,
1991.
8.
On
October
18,
1991
the
affiant
requested
that
the
Appeal
be
removed
from
the
list
of
cases
for
hearing
in
December,
1991
due
to
a
previous
commitment.
The
Tax
Court
of
Canada
confirmed
such
removal
on
October
21,
1991.
9.
On
January
2,
1992,
some
seventeen
months
after
service
of
the
notice
of
appeal,
the
respondent
purported
to
file
a
reply
to
the
notice
of
appeal.
10.
On
or
about
February
18,
1992
it
appears
that
a
notice
of
hearing
was
sent
in
respect
of
the
appeal
for
the
April
21,
1992
sitting
of
the
Tax
Court
of
Canada.
15.
Pursuant
to
a
request
from
the
affiant,
the
status
hearing
was
scheduled
for
November
2,
1992,
to
coincide
with
another
such
hearing
called
for
that
date.
16.
At
the
said
status
hearing,
dates
were
agreed
upon
for
the
hearing
of
the
appeal
and
it
was
agreed
that
the
motion
in
respect
of
which
this
affidavit
is
filed
would
be
made
as
a
separate
proceeding,
to
occur
well
prior
to
the
scheduled
hearing
of
the
appeal.
No
evidence
was
adduced
by
the
respondent
to
explain
why
he
was
late
by
15
months
to
file
the
reply
to
the
notice
of
appeal.
Respondent's
position
Counsel
for
the
respondent
submitted
that
section
7
of
the
Rules
was
prospective
in
its
effect
and
that
it
required
for
its
application
that
the
appellant
itself
had
made
the
application.
He
also
said
that
no
prejudice
was
suffered
by
the
appellant,
the
proof
of
this
being
that
both
times
the
appeals
were
set
down
for
hearing
by
the
Court,
adjournments
were
requested
by
the
appellant.
Therefore,
this
is
not
a
case
where
there
is
need
for
a
leave
from
the
Court
to
file
a
reply.
Appellant's
position
Counsel
for
the
appellant
stated
that
the
mere
fact
that
the
Court
set
down
the
case
for
hearing,
and
not
the
appellant,
did
not
change
the
content
of
section
7
of
the
Rules.
When
the
case
is
set
down
for
hearing,
it
means
that
the
pleadings
are
closed
and
the
Crown
should
not
recover
its
litigious
advantage
that
it
has
lost
by
its
own
inaction.
Here
was
not
a
case
of
inaction
on
a
short
period
but
for
an
unacceptable
period
of
17
months.
There
had
not
been
any
agreement
between
the
parties
to
postpone
the
filing
of
the
reply,
or
delay
the
hearing
of
the
appeal
for
whatever
reasons.
It
is
not
the
taxpayer's
role
to
enjoin
the
Crown
to
file
its
reply.
It
is
the
Crown's
duty
to
ensure
that
the
reply
is
filed
in
a
timely
fashion
so
that
justice
proceeds
at
a
diligent
pace.
It
would
be
a
mockery
of
the
justice
system
to
accept
the
filing
of
the
reply
at
that
late
a
stage
as
if
nothing
unfair
had
been
caused
to
the
litigant.
Counsel
for
the
appellant
referred
the
Court
to
the
case
of
Cotroneo
v.
M.N.R.,
[1983]
C.T.C.
2689,
83
D.T.C.
617
(T.C.C.).
Counsel
for
the
respondent
referred
the
Court
to:
Bailey
v.
M.N.R.,
[1989]
2
C.T.C.
2177,
89
D.T.C.
416
(T.C.C.);
Delage-Moore
v.
M.N.R.,
[1975]
C.T.C.
2204,
75
D.T.C.
182
(T.R.B.);
Kosowan
v.
M.N.R.,
[1989]
1
C.T.C.
2044,
89
D.T.C.
58
(T.C.C.);
Discovery
Research
Systems
Inc.
v.
Canada,
[1992]
1
C.T.C.
2394,
D.T.C.
1306
(T.C.C.).
In
the
Bailey
case,
the
appellant
applied
to
the
registrar
to
have
the
appeal
set
down
for
hearing
three
days
after
the
notice
of
appeal
had
been
transmitted
to
the
respondent,
56
days
prior
to
the
expiry
of
the
60
days
referred
to
in
subsection
6(1)
of
the
rules.
Because
of
this,
Judge
Rip
was
of
the
view
that
there
was
no
provision
in
the
Rules
preventing
the
Minister
from
filing
his
reply.
In
Delage-Moore,
Cardin,
in
his
then
capacity
of
Assistant-Chairman
of
the
Tax
Review
Board,
stated
at
page
2205
(D.T.C.
182-83):
However,
a
reply
to
a
notice
of
appeal
by
respondent
will
be
accepted
by
the
Board
and
considered
valid
if
it
is
filed
after
the
60-day
period,
but
before
appellant
makes
his
application
to
have
his
appeal
entered
on
the
list
of
appeals
to
be
heard.
It
may
be
useful
to
mention
that
Rule
8
must
not
be
interpreted
as
providing
for
an
ex
parte
hearing,
or
that
the
appeal
will
be
automatically
allowed.
As
stated
in
Rule
8,
the
Board
may
dispose
of
the
appeal
on
the
basis
that
the
allegations
of
fact
contained
in
the
notice
of
appeal
are
true,
but
the
procedure
of
the
Board
at
the
hearing
of
the
appeal
will
not
be
otherwise
altered.
In
Kosowan,
Judge
Sarchuk
stated
the
following
at
page
2047
(D.T.C.
60):
.
.
.
What
is
of
concern
is
that
an
appellant,
particularly
one
who
files
a
reasonably
coherent
and
detailed
notice
of
appeal
and
who
does
not
himself
delay
or
procrastinate,
is
entitled
to
have
his
appeal
determined
expeditiously.
.
.
.
There
is
absolutely
no
requirement
on
an
appellant
to
advise
the
respondent
that
he
is
dilatory
or
that
an
application
to
have
the
appeal
entered
on
the
next
list
pursuant
to
Rule
7
is
being
contemplated.
Is
it
an
essential
condition
for
the
application
of
section
7
of
the
Rules
that
the
case
be
set
down
for
hearing
on
the
appellant's
initiative?
I
do
not
think
so,
if
I
rely
on
the
obvious
object
of
the
provision,
that
the
appellants
right
not
be
obstructed
by
the
respondent's
inaction.
When
the
appeal
is
set
down
for
hearing
on
the
Court's
initiative,
it
means
at
least
that
the
pleadings
ought
to
have
been
closed
in
view
of
the
length
of
time
that
had
gone
by
since
the
filing
of
the
notice
of
appeal.
The
Court's
initiative
cannot
exculpate
the
respondent
from
his
obligation
to
proceed
in
a
diligent
manner,
though
that
fact
could
be
taken
into
consideration
when
deciding
the
terms
to
apply
to
the
filing
of
the
respondent's
pleading.
I
find
acceptable
the
proposition
that
although
there
is
no
real
financial
prejudice,
there
is
prejudice
for
the
appellant
in
not
having
known
the
exact
position
of
the
respondent
in
a
timely
manner
and
in
this
way,
being
prevented
from
exercising
its
right
in
having
the
matter
in
dispute
diligently
resolved
by
the
Court.
In
the
case
at
bar,
no
explanations
were
given
concerning
the
undue
delay
to
file
the
reply,
therefore,
the
Court
has
to
consider
that
there
does
not
exist
a
reasonable
cause
for
the
delay.
Since
there
is
no
reasonable
cause
for
the
long
delay
in
filing
the
reply,
since
there
is
a
certain
measure
of
prejudice
to
the
appellant,
and
taking
into
consideration
that
the
appeal
was
set
down
for
hearing
on
the
Court's
initiative,
the
Court
therefore
rules
that
the
reply
will
be
filed
as
a
document
stating
the
position
of
the
respondent
and
the
appeal
will
be
disposed
of
on
the
basis
that
the
allegations
of
fact
contained
in
the
notice
of
appeal
are
true.
In
other
words,
the
burden
of
proof
falls
on
the
respondent.
Application
granted.
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