Rowe T.C.J (orally):
1 THE REGISTRAR: I call Court File 96-856(IT) between Gemini Biochemical Research Limited and Her Majesty the Queen.
2 Appearing for the applicant is Mr. Forrester and for the respondent is Ms. Drissell.
3 HIS HONOUR: Now, the Minister here basically says that the return or the information required in the return regarding the scientific research and experimental development expenditures was submitted out of time because of the fact that the time previously established had been abridged and in effect that the company just missed the time period for filing this information. Is that fair?
4 What is it you think I can do about it? If you missed it you missed it.
5 MR. FORRESTER: Your Honour, they have suggested that I was uninformed about this change. When I went to pick up the tax forms, which was after the June, 1994 change in the tax law, the information guidelines which the people in the Revenue Canada forms office presented to me at that time did not include the changes to the law.
6 HIS HONOUR: They didn't have to. First of all, the very use of the word “guideline” is exactly indicative of what it is, it's a guideline. There's no requirement that your company be specifically put on a mailing list that Revenue Canada has to advise you when it's about to change the law and if you rely on waiting for changes in tax law to make its way into a guideline, you're going to do so at your peril, as was the case here, so there's no requirement in law that these kind of amendments — people are presumed to know and to keep abreast of this. The royal assent was, the Minister says, received on June 15th, 1994, and there was appropriate proclamation in the Canada Gazette. There must have been some information released by way of circular or a reference in the newspapers or Globe & Mail or something, and the fact that it was not contained in the particular guideline is of absolutely no import or significance as a matter of law. If you've missed the deadline, you missed the deadline and I take it that you don't quarrel with the fact that the deadline for providing information regarding these expenditures was missed.
7 MR. FORRESTER: After they informed me, yes, I was aware, however, to say that there was no mailing list, I used to be on the mailing list for Revenue Canada for these. I have been involved in the private sector research in Calgary for 15 years. There used to be a regular mailing of changes to the law as it pertained to as, for the scientific research.
8 HIS HONOUR: But it's not a legal requirement. The issue in this appeal is whether the appellant's claim for the scientific research and experimental development expenditure was filed within the prescribed time limit. The answer to that was, no, the appellant's claim wasn't filed within the prescribed time limit. Isn't that correct?
9 MR. FORRESTER: My argument is that I was given the wrong information.
10 HIS HONOUR: Well, you may have been, but if you rely — I mean, why would anybody involved in business, without more, rely on some information off a rack in a spinner, a pamphlet in a spinner rack in the Revenue Canada office or from some clerk at the desk? That's not how corporations run their affairs with regard to tax matters.
11 MR. FORRESTER: It's more than just a flyer in a rack, it tells you how you file your returns for these particular tax credits and there's information in there that you have to go by.
12 HIS HONOUR: But there's also information that was obviously out there somewhere indicating that the prescribed time limit to identify those expenditures was amended and that there was a particular deadline that now had to be met by people wanting to have those expenditures examined by the Minister and you missed the deadline. Now, I cannot — there is no authority in me to amend the Income Tax Act or the regulations made thereunder to somehow expand that limitation period to include the appellant on the basis that it proceeded in the absence of proper information.
13 MR. FORRESTER: But I thought I was using the correct information. They did get the information out eventually, so they obviously felt that it was important to get it out, but they just didn't get it out in a timely fashion.
14 HIS HONOUR: One of the significant things, especially in terms of tax law, is particular time periods and limitation periods and the fact that things are undergoing on a more or less continual basis, amendments to various provisions and parts and sections and so on, and it is not the responsibility of the Minister of National Revenue to bring home personally to every taxpayer that he is about to change the limitation period with regard to some provision of the Income Tax Act.
15 MR. FORRESTER: But it does not have to go out to every taxpayer. In fact, I was on the list that previously that they used to send information about changes. In fact, one of the last letters I got outlining changes was something on the order that I should clip the various forms in or to send in. How come they can spend money on something that seems like inconsequential as the order that you should put your forms and stop sending out the really important information?
16 HIS HONOUR: I don't know. All I'm telling you that as a matter of law there is no requirement that amendments to any kind of legislation be brought home to Canadians in other than the normal fashion which requires that certain regulations be published in the Canada Gazette and in other instances it is mere passage of the appropriate legislation through the House of Commons, approved by the Senate and then the legislation receives royal assent.
17 Now, generally speaking in Canada, some significant change is made and receives appropriate publicity. With 400,000 or 500,000 laws, you can't tell me that if today the City of Calgary amends its bylaw to require a permit for picket fences that are over five foot eleven inches instead of six feet out in the Bear Creek area, that you're going to personally get a notice from Mayor Duerr informing you of that. You are not going to, and as a matter of law, individuals are presumed to know the law, which is a very difficult presumption, especially when you're dealing with matters of income tax but the assumptions of fact made by the Minister, as you indicated, are correct in the sense that the claim for the scientific research and experimental developmental expenditures was not filed within the prescribed time period, and you indicate to me that the reason for that is that you had not received information to that effect. That is not something in law which has any effect whatsoever on the validity of the Minister's assessment.
18 My jurisdiction in these matters is limited solely to the question as to whether or not the Minister's assessment was properly issued in accordance with the Income Tax Act. In this particular regard that assessment is in fact correct as a matter of law and as a consequence, I understand what you're saying and the reasons for the non-compliance, but in law those reasons are incapable of constituting a matter that can impact favourably — from your standpoint — upon the assessment.
19 As a consequence, therefore, the appeal from the 1993 taxation year by the appellant is hereby dismissed.
20 MS. DRISSELL: Thank you, sir.
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