Charlotte Hébert-Gravel v. Minister of National Revenue, [1982] CTC 2662

D E Taylor [TRANSLATION]:—This decision was rendered on June 4, 1982 following an application to the Tax Review Board for an extension of the time within which an appeal might be instituted from a tax assessment for 1976. The application, dated November 3, 1981, was heard at Montreal, Quebec on December 17, 1981.

The said application for an extension contains the following facts which, in my view, summarize the problem:

— On March 5, 1979 the respondent assessed the applicant for the 1976 taxation year in the notice of assessment bearing No 410802;

— On May 31, 1979, the applicant filed a notice of objection against the above- mentioned notice of assessment;

— On August 19, 1980 the respondent issued by registered mail a Notification of Confirmation by the Minister relating to the above-mentioned notice of assessment;

— The applicant did not learn of the sending of this Notification of Confirmation by the Minister until early October 1981;

— Since she did not know of the sending of the said Notification of Confirmation by the Minister until early October 1981, the applicant could not institute an appeal to the Court within the prescribed time, namely, within ninety days from the date of mailing of the said Notification;

— The Notification of Confirmation by the Minister was not sent to the applicant personally but rather to her accountant with a copy to her lawyer;

— The applicant has lived in France since early 1979.

The Minister, on the other hand, replied:

The respondent states that he will object to the application for an extension of the time within which an appeal may be instituted against a tax assessment dated March 5, 1979 on the ground inter alia, that the facts alleged by the applicant do not constitute circumstances such that it would be just and equitable for the Board to allow the application. The respondent relies, inter alia, on sections 167(1) and 167(5)(c) of the Income Tax Act.

The applicant testified as follows:

EXAMINATION BY MR S GRAVEL

Q The question I am going to ask is relatively simple. Mrs Gravel, did you receive a document, which I can show you here, entitled “Notification of Confirmation by the Minister” dated August 19, 1980? Do you already know about that?

A No.

Q When did you first learn of this document that was intended for you?

A Not until October 1981, when my son called me in Paris.

Q This Notification is addressed to Mrs Charlotte Hébert-Gravel, care of Mr Bernard Lamoureux. Mrs Gravel, did you give Mr Bernard Lamoureux, Accountant, authority to receive on your behalf correspondence from the Department?

A No, never.

Q Revenue Canada. Have you ever written to the Department of National Revenue telling it to send your taxation documents care of Mr Bernard Lamoureux?

A No, never.

CROSS-EXAMINATION BY MR L MASSE

Q Mrs Gravel, do you complete your returns alone, that is to say, I am referring particularly to the years 1978 and 1979, did you complete your tax returns alone or did you deal with or call upon an accountant?

A It’s my accountant who prepared them.

Q Every time:

A Yes.

Q I’m going to show you two tax returns, one for 1978 and one for 1979. Now, this is the one for 1979, but prior to that I am going to show you whether you signed it. It’s only the return as such; I haven’t mentioned the other slips attached to the inside of the return. I don’t think that is relevant. This will be 1-1 and I-2.

I have two tax returns here; I note on the tax return for 1978 on the fourth page that the name Charlotte Gravel appears, and I believe that the initials appear on the side. It is dated March 19, 1979. Are you aware of that?

A That is not my signature.

Q It is not your signature?

A No.

Q Do you not recognize the initials on the side?

A No.

Q Therefore it was not you who filed this return? Could you tell me the name of your accountant in the years in question:

A Lamoureux.

Q Bernard Lamoureux?

A Yes.

Q The initials at the bottom beside your name are not BL?

A I don’t know.

Q I refer to the tax return for the 1979 taxation year, also on page 4. I also note that the name appearing there is Charlotte Gravel and beside it I can also see initials. It is dated March 24, 1980. Is that your signature?

A No.

Q It’s not your signature. The initials on the side, do you not know whose they are?

A No.

Q If I understand correctly, you didn’t file a tax return for the year in question?

MR S GRAVEL

If I may add something; the returns were perhaps filed but not signed.

MR L MASSE

By Mrs Gravel. But is it recognizable as her return, that is her return?

MR S GRAVEL

I think that what can be admitted without going any further with the testimony is that the figures there, the tax return, the return that’s there quite obviously concerns Mrs Gravel’s income.

MR L MASSE

Is it possible that the assessment was made on the basis of that return?

MR S GRAVEL

It is possible and I would even say probable.

MR L MASSE

Not the assessment in issue but the assessments that were issued in respect of Mrs Gravel?

MR S GRAVEL

That’s right.

MR L MASSE

Because the assessment under section 160 was issued in respect of tax allegedly owed by Mrs Gravel’s husband, under section 160.

MR S GRAVEL

That's right.

In response to the questions asked by the Board, the two counsel made the following arguments:

MR L MASSE

If I may refer to the two returns I have here, first the one for 1978, I note that the address on the tax return is on the first page and refers to Charlotte Gravel, care of Mr Bernard Lamoureux, 2210 Henri Bourassa Boulevard East, Apartment 4 in Montreal. If I may also refer to the 1979 tax return, this return was also sent care of Mr Bernard Lamoureux, still at the same address. Moreover, I would point out to the Court that the 1979 tax return is dated March 24, 1980. Now the Notification of Confirmation was sent on August 19, 1980. This was the last address of Mrs Gravel that the Department had in its possession. It did not have any other.

Both for the 1978 and for 1979 this is the address on the tax return. I would also point out that it was the only address the Department had at that time that there was no reason to believe that, in any case, Mrs Charlotte Hebert-Gravel had provided another address at that time.

MR L MASSE

. . . my colleague seems to admit that the Notification was in fact sent and received by the lady’s accountant, and that that was the last address known to the Department.

MR S GRAVEL

What I wish to admit on behalf of my client is that it was sent and received, sent to the accountant and received by him. But I do not know whether that was really the last address known to the Department, because nothing would enable, or in fact the applicant obviously never signed these documents. I think you would probably admit, or do you dispute this fact also?

MR L MASSE

No, no, I think it is clear that it was not the lady who completed it but since it was her accountant who, in my opinion, must have completed it . . .

MR S GRAVEL

. . . it was the accountant and his initials are recognizable. It was without Mrs Gravel’s knowledge that the accountant’s address was included in the returns. If she had seen these documents, she would have signed them herself. There was no point in anyone else signing them. The point I am trying to make is that it was the last address, in fact it was the last address given by the accountant, but the Department knew, however, the address of Mrs Gravel’s last residence, and she had never informed . . .

MR L MASSE

. . . Strictly speaking, there is nothing in the tax return to show that that was Mr Lamoureux’s address . . . It states that it is sent care of Mr Lamoureux. The Department is not aware that Mr Lamoureux is an accountant.

MR S GRAVEL

I would admit this fact, but what I wish to stress is that Mr Lamoureux took the initiative of including this address, which makes it clear that it is not Mrs Gravel’s, and he also took the initiative of signing the returns for her and Mrs Gravel was not aware of this and was not aware of the address that was notified, if it’s possible to say that, to the Department. She still kept an address in Montreal, and if the documents had been sent there they would probably have been forwarded, either to her children or elsewhere.

THE CHAIRMAN

. . . In my view, at this point, the address on the notice of objection is not exactly the same as the address on the confirmation. If I understood correctly, it is the address of the accountant, Mr Bernard Lamoureux, on the confirmation, but it was the old address, the lady’s old address, on the notice of objection.

MR S GRAVEL

Yes, that is correct; it is the address at which she was living at the time when she was resident in Canada.

MR L MASSE

It is clear that there is an address on the notice of objection that is not the one to which the notification of assessment was sent; that is clear. My friend submitted that the notice of objection was in fact signed by Mrs Gravel, whereas the tax returns for 1979 and 1980 were not.

I submit nevertheless to the Board that if, and I would emphasize this if, the Department had taken note of this address on the notice of objection, Mrs Gravel would not then have had any chance to learn of the Notification of Confirmation, since it was recognized that Mrs Gravel had not lived in Canada since 1979. If the Notification of Confirmation had been sent to that address, she would never have received it; that is the first thing. The second is that Mrs Gravel apparently gave her accountant authority to file her tax returns for 1979 and 1980. My friend argues that Mr Lamoureux, although it was not part of his authority, included his personal address on Henri Bourassa Boulevard.

Now, I would submit tot he Board that the Minister cannot be held responsible, since that came from somewhere, the Minister cannot be held responsible for the fact that on the tax return the accountant included an address other than that of the applicant. Now there was a reason for the different address on the tax returns; the Department itself did not know at that time that Mrs Gravel had gone to Europe. There was no way it could have known, except that the accountant himself, Mr Lamoureux, knew. That is the most likely reason why he entered a new address on her tax return.

Now the Minister was, I would submit, correct in sending the Notification of Confirmation to the taxpayer’s last address. Let me give an even simpler example; if Mrs Gravel had not left for France but had simply moved — there are many people in Quebec who are tenants and who move from one year to the next: when they move and there is a notice of objection, it is clear that there might be an old address.

The Minister has to use an address and when the taxpayer gives a new address in his tax return, I would submit that the Minister is justified in sending any further correspondence to this address, which comes from somewhere, so that I don’t see any problem.

MR S GRAVEL

On the subject of the address, of the problem with the address, the notice of objection is a short form prescribed by the Department and in which an address is requested. The applicant entered her address and signed herself. She could have other addresses for other purposes, she could have given authority to her accountant, which she did not do, to change the address for the returns.

This is a very specific procedure and the Department knew of that address and should have, since we’re talking of procedure, should have relied on that address and sent a registered letter. If it had been returned to the Department, it would have done its duty, which it did not do. The Department immediately sent it to the accountant and to the lawyer, whose address appears nowhere. For no particular reason, nothing was sent to the residence, and the Department was subsequently looking for the lady because she had disappeared. It did not comply with the provisions prescribed in its own form.

I have concluded from a careful study of these comments that the basic submission made by counsel for the applicant was that since the Notification of Confirmation was not sent to the address given by Mrs Gravel in her notice of objection (4874 Côte St Catherine Rd, App 1103, Montreal*) [1] but rather was sent care of her accountant Mr Bernard Lamoureux (2210 Henri Bourassa Blvd East, Montreal, Quebec H2B 1T3), the Minister did not inform the taxpayer by registered letter of the action he intended to take concerning her. Whether or not the applicant personally received the Notification, had knowledge of it and where her place of residence was at that time, these details are, in my view, neither relevant nor essential to the issue. I consider that the sole issue is to determine whether or not the address 2210 Henri Bourassa Blvd East, Apt 4 was the address that should have been regarded by the Minister at that particular time as “the taxpayer’s last known address”.

Copies of the tax returns for the 1976, 1977, 1978 and 1979 taxation years and the notices of assessment were filed with the Board. Counsel for the applicant filed the following documents:

— A letter dated July 7, 1980 from Revenue Canada to the applicant addressed to “Côte St Catherine Road”, which related directly to the notice of objection involved in this application;

— A receipt from Revenue Canada dated July 15,1980 sent to the applicant at the address on Henri Bourassa in part payment of the tax payable.

The above-mentioned tax returns give as the full address of the applicant:

* The change of address from Lévesque Boulevard to Côte des Neiges was shown by the applicant when she filed her tax return for 1977. The tax form she used was the current form with the previous address preprinted thereon and sent to her by Revenue Canada.

† The change of address from Côte des Neiges to Henri Bourassa did not appear on the forms sent by Revenue Canada for 1978 and 1979. The returns were apparently prepared on blank forms and showed only the new “Henri Bourassa” address.

The above-mentioned notices of assessment were sent by the Minister to the following addresses:

I cannot accept the explanation given by the applicant that she had given Mr Lamoureux limited authority with respect to her affairs, and that she exercised control over the status of her notice of objection. On the other hand, the above-mentioned documentation does not prove that the Minister changed the taxpayer’s last known address immediately and completely when he was informed of the change in an appropriate way. By sending the confirmation, the Minister chose a logical address, that on Henri Bourassa. It was not, however, the only address available to Revenue Canada, nor was it the only address used by Revenue Canada at that time. In these circumstances, the applicant must be given the benefit of the doubt.

The application is allowed.

Application allowed.