Rothstein J.:
1 This is an appeal from a June 7, 1990 decision of the Canadian International Trade Tribunal finding that the plaintiff did not qualify for a reduced rate of federal sales tax on the sale of “Ultraline” shelving for supermarkets.
2 The relevant legislation is subsection 27(1), paragraphs 27(1.1)(b) and (d) and Schedule V, Part I of the Excise Tax Act:[FN1: <ul>The relevant legislation is now subsection 50(1), paragraphs 50(1.1)(<em>b</em>) and (<em>d</em>) and Schedule V of the<em>Excise Tax Act</em>. The parties were not clear as to the precise time when the issue in this case arose but they thought it must have been in 1986 and/or 1987. The provisions cited are in accordance with 1986, c-54, assented to 19th December 1986. Subsection 5(3) of that Act provides:<li><p>5. (3) Subsections (1) and (2) [the relevant provisions in section 27(1.1)] shall be deemed to have come into force on April 1, 1986.</p></li></ul>] The determination of the question requires detailed reference to the schedule and that is the reason it is set out in extenso.
27.(1) There shall be imposed, levied and collected a consumption or sales tax at the rate prescribed in subsection (1.1) on the sale price or on the volume sold of all goods
27. (1.1) Tax imposed by subsection (1) is imposed
(a) ...
(b) in the case of goods enumerated in Schedule IV, at the rate of eight per cent;
(c) ...
(d) in any other case, at the rate of twelve per cent;
Schedule V
Part I Construction Materials[FN2: <p>This schedule was applicable in 1986/1987, having been amended in S.C. 1986, c. 9, subsection 52(1), which was deemed to have come in force by section 52(2) on July 1, 1985.</p>]
1. Bricks; building tile; building blocks curved or shaped; building stone; sidewalk and patio slabs; curbs.
2. Chimneys, chimney caps and built-in fireplaces.
3. Doors, windows and shutters for buildings and other structures and associated hardware not including padlocks; door and window screens and awnings.
4. Electric conducting and telecommunication wire and cable; transformers, circuit breakers and related electrical equipment designed for permanent installation in a system for the supply of electricity.
5. Fire-fighting and fire-detection equipment for installation in buildings.
6. Floor tile and hard surface composition yardage flooring for permanent bonding to floors and underlay therefor; materials to be incorporated in terrazzo flooring.
7. Glass for buildings and other structures.
8. Hard surface plastic laminated building materials.
9. Hot water tanks and water heaters for permanent installation in water systems for buildings.
10. Kitchen and bathroom cabinets and countertops therefor, for permanent installation in buildings.
11. Lumber; plywood; sash; shingles; lath; siding; stairways; walkways; fire escapes; railway ties; light standards, towers and similar construction components; cornice, frieze, pilasters and other such building components, not including assembled or unassembled furniture.
12. Materials for waterproofing and moisture-proofing buildings.
13. Nails, spikes, screws, nuts, bolts and washers, rivets and similar fasteners.
14. Paints, varnishes, stains and similar coatings and finishes; creosote oil and other wood preservatives; additives for the foregoing.
15. Piles for structures.
16. Pipe, conduit and tubing designed for use in buildings, sewers, irrigation or drainage systems, pipelines and other construction; valves and fittings therefor.
17. Plaster; lime; cement and additives for concrete; prepared dry concrete and mortar mixes.
18. Plaster boards, fibreboard, wall panels, building paper, wallpaper and materials for ceilings, walls, insulation or acoustical purposes, not including carpeting.
19. Septic tanks and grease traps therefor; sump pumps.
20. Shower baths, bathtubs, basins, faucets, closets, lavatories, urinals, sinks and rims therefor and laundry tubs; parts for the foregoing.
21. Structural metal and fabricated metal for buildings and other structures.
22. Tar; asphalt; roofing materials and components including eavestroughing and downspouts.
23. Ventilators and louvres.
24. Heat pumps, when designed for use in permanently installed heating systems for buildings.
25. Heat recovery units and devices for extracting heat from exhaust air or waste water for recovery of energy.
26. Solar panels and tubes designed for collecting and converting solar energy into heat for use in solar heating systems.
27. Thermal insulation designed for pipes and ducts used in buildings and mechanical systems; wrapping materials designed exclusively for use with such insulation.
28. Wood-burning stoves and wood-burning space heaters.
29. Loading dock seals and shelters designed to conserve heated or refrigerated air during loading and unloading.
30. Mobile homes and modular building units.
31. Buildings or other structures manufactured or produced by a person otherwise than at the site of construction or erection thereof in competition with persons who construct or erect similar buildings or structures not so manufactured or produced.
32. Structural building sections, for incorporation into buildings or other structures manufactured or produced by a person otherwise than at the site of construction or erection of the building or other structure in competition with persons who construct or erect buildings or other structures that incorporate similar sections not so manufactured or produced.
33. Ready-mix concrete.
34. Asphalt paving mixtures.
35. Such additional articles and materials as are prescribed by regulation of the Governor in Council to be construction materials.
3 The plaintiff says that it qualified for a reduced rate of eight per cent sales tax as opposed to twelve per cent as the product at issue comes within item 21 of Schedule V, Part I, “fabricated metal for ... other structures”. The product is metal shelves for supermarkets. The plaintiff fabricates “raw” steel into fabricated steel components which, when assembled, will form the shelves which are commonplace in supermarkets. Components are only manufactured to order. They are shipped in boxes for assembly at site. Some shelving is in the form of islands and other is attached to walls or other equipment such as refrigerators. Anchors and bolts, which attach the shelving to walls and equipment, or in some cases to the floor or support beams, are not supplied by the plaintiff. The crews that assemble and install the shelving are not employed by the plaintiff.
4 Having regard to item 21, there are two issues.(1) Are what is being sold, fabricated metal for other structures as opposed to shelves in unassembled form?
(2) Are shelves “other structures”?
5 Chateau Manufacturing Ltd. v. Deputy Minister of National Revenue (Customs & Excise) (1983), [1984] C.T.C. 43 (Fed. C.A.), is dispositive of the first issue. At page 45, Heald J.A. states:
Furthermore, even assuming the subject goods to be “a unit in an unassembled form” as found by the Board majority, this would not, of itself, exclude material, which obviously consists of structural and fabricated metal for buildings, from being included in Schedule V (now Schedule IV) pursuant to Paragraph 21 thereof without express language therein so excluding it. I say this because of the language used by Parliament in Paragraph 11 of Part 1 of Schedule V. Paragraph 11 includes a multitude of items such as lumber; plywood; sash etc., “and other such building components, not including assembled or unassembled furniture.” (Emphasis added). It would take words of similar import to persuade me that Parliament intended to exclude subject structural and fabricated metal from Paragraph 21.
What I interpret Heald J.A. to be saying is that merely because one item can be characterized as a unit in unassembled form does not disqualify it from also being characterized as structural metal or fabricated metal for buildings or other structures. The evidence here is that the fabricated metal requires assembly at the site of the supermarket by crews not associated with the plaintiff. By the reasoning in the Chateau case, which is binding on me, even assuming what the plaintiff shipped to site were shelves in unassembled form, they would not be excluded from item 21 on that account.6 The second issue is more difficult to resolve. At first blush, one might think that “other structures” was to be considered as ejusdem generis with the term “building” in item 21. If that were the case, I think it would be clear that supermarket shelves were not contemplated. However in Superior Pre-Kast Septic Tanks Ltd. v. R., [1978] 2 S.C.R. 612 (S.C.C.), Martland J. finds that with respect to section 26 of the Act, the terms are not ejusdem generis:
Another ground adopted at trial was that the application of the rule noscitur a sociis in relation to the concluding words of s. 26(4) “any such building, structure, building sections” and the application of the ejusdem generis rule to the words “building or other structure” in para (a) of the subsection requires a restriction of the meaning of “or other structure” to something in the nature of a building.
To restrict the meaning of the word “structure” in this way would mean that its use in this paragraph would serve no useful purpose. Furthermore, it is preceded by the word “other” which certainly indicates that it is intended to refer to something other than a building. This point was made in this Court in the case of British Columbia Forest Products Limited v. The Minister of National Revenue. That case was concerned with the determination of capital cost allowance and one of the questions in issue was as to whether certain property of the taxpayer fell with Class 3 of the Regulations under the Income Tax Act, R.S.C. 1952, c. 148. Paragraph (a) of Class 3 referred to “a building or other structure”. At p. 111 the proposition that “structure” should be construed ejusdem generis with the word “building” was rejected and it was said: “It is preceded by the word ‘other’ thus contemplating structures other than buildings”.
While Martland J. was not dealing with Schedule V, his finding causes me not to apply the ejusdem generis rule with respect to the term “other structure” in Schedule V. It is true, as I later note, that he found the Schedule and section 26 of the Act to be unrelated sections. However, subsequent to the decision in Superior, Schedule V was amended to include items 31 and 32. The wording of item 31 is very close to the wording in paragraph 26(4)(a), creating a closer link between Schedule V and section 26 than existed when Superior was decided. I repeat item 31 and quote paragraph 26(4)(a) together so that their largely identical wording may be easily seen.31. Buildings or other structures manufactured or produced by a person otherwise than at the site of construction or erection thereof in competition with persons who construct or erect similar buildings or structures not so manufactured or produced. [emphasis added]
26. (4) Where a person
I therefore follow Martland, J. and do not invoke the ejusdem generis rule for purposes of interpreting the term “other structures” in item 21 of Schedule V. “Other structures” need not be in the nature of a building.7 The Canadian International Trade Tribunal found helpful the criteria for determining the existence of a structure outlined by MacGuigan J.A. with respect to paragraph 26(4)(a) of the Excise Tax Act in Plastibeton Inc. v. Minister of National Revenue (1986), 86 D.T.C. 6400 (Fed. C.A.)at page 6402:
It seems to me that in this analysis Martland J. endorses three criteria for determining the existence of a structure: (1) it must be built or constructed; (2) it must rest on or in the ground; (3) it must not be “a part” of another structure.
8 The plaintiff submits that regard should be had to definitions of “structure” found in the following dictionaries:
(1) The Shorter Oxford Dictionary on Historical Principles: That which is built or constructed; a building or edifice of any kind, 4. esp. one of considerable size in imposing appearance, 5. more widely, a fabric or framework of material parts put together.
(2) Black's Law Dictionary: Any construction, or any production or piece of work artificially built opt. composed of parts joined together in some definite manner. That which is built or constructed; an edifice or building of any kind.
(3) The Living Webster Encyclopaedic Dictionary of the English Language: Something built or construed; a building; an edifice; a bridge, dam or framework; any construction; anything composed of parts arranged together in some way.
Plaintiff's counsel says these definitions of “structure” are wide enough to include supermarket shelves. In particular, he says that nothing in the definitions precludes a structure from being within the interior of a building and resting on the floor of a building.9 The Plaintiff's argument would appear to be in contradiction of the criteria of MacGuigan J.A. for determining the existence of a structure, particularly the second, if indeed those criteria apply to the use of the term “other structures” in the Schedule. In Plastibeton, MacGuigan J.A. expressly states that the item in question there, median strips for a highway, “cannot qualify as an ‘other structure’ from it (the highway) for purposes of paragraph 26 (4)(a)” [emphasis added]. In Superior Pre-Kast, the case from which the criteria in Plastibeton were developed, Martland J. refers to paragraph 26(4)(a) as an “unrelated section” from the listing in Schedule V. In Superior Pre-Kast, the products, septic tanks, argued to be “other structures” for purposes of section 26 were listed in the Schedule. At page 617, Martland J. states:
The petition of the appellant Lloydminster was dismissed on the merits. One ground of decision at trial was that to include septic tanks within “other structure” would involve a conflict with s. 29(3) of the Act. That subsection reduces by one-ninth the tax imposed by s. 27 in respect of articles enumerated in Schedule V. Part I of Schedule V, headed “Building Materials”, includes, in item 17:I do not agree with this conclusion. The fact that septic tanks are listed generally in Schedule V does not mean that such a tank cannot be a “structure” within the meaning of an unrelated section which defines the special circumstances in which a person who has manufactured or produced such structure is deemed not to be the manufacturer or producer of it. [emphasis added]
10 However, as I have said, since the Superior and Plastibeton decisions, Schedule V has been amended to include, among other things, items 31 and 32. The wording of items 31 in particular is very similar to the wording in paragraph 26(4)(a) and I think it may be that Martland, J.'s finding that paragraph 26(4)(a) and Schedule V are unrelated sections has been superseded, at least with respect to item 31. It might therefore be defensible to apply the Plastibeton criteria, which were based on the reasons of Martland J. in Superior, to interpret the term “other structures” in item 31 of the Schedule. Then, as it would follow logically that the term “other structures” should have a consistent meaning throughout the Schedule, one would likewise apply the Plastibeton criteria to item 21. This would defeat the Plaintiff's claim as the shelves in question do not rest in or on the ground.
11 Be that as it may, I do not think it necessary to rely exclusively on the criteria in Plastibeton in deciding what may be included in “other structures” in item 21. A contextual analysis of the Schedule leads to the same result as the direct application of the Plastibeton criteria. The dictionary definitions put forward by the Plaintiff are extremely broad. However, legislative terms must always be construed as having regard to context. As stated by Heald J.A. in Chateau at page 44:
The language used in Paragraph 21 is common language bearing a plain meaning. Accordingly there is no reason, in my view, for not giving to the words used therein the broadest meaning possible consistent with the context in which those words are found....
[emphasis added]
12 It is clear that a Court may look to the provisions under a heading to interpret the terms in the individual provisions. In Driedger on the Construction of Statutes, 3rd ed., the learned author states at page 272:
In the view of the court, this meant that headings “are not to be used explicitly as tools of interpretation”. However, the grouping of provisions under the heading could be used for this purpose. As Lambert J.A. explained [in Re Peters and District of Chilliwack (1987), 43 D.L.R. (4th) 523 at 527]:
...in approaching the Act as I have done I have looked at the sections in groups within parts, and while I have referred to the tiles [ i.e., the headings and subheadings], the titles are not an essential part of the reasoning which leads me to conclude that the scheme of the Act contemplates that only those zoning by-laws passed under s. 716 are required to meet the public hearing requirements of s. 720....
What the headings said was not essential. The important thing was the grouping of provisions within different units and sub-units.
13 With respect to items 3 and 7 of the Schedule, which list doors, windows, shutters, associated hardware, screens, awnings and glass, the term “other structures” must refer to a type of construction other than a building, of which the listed elements, or any of them, could form a part. Perhaps a dam with interior facilities or even a draw-bridge with a small room for an attendant might be included. Door, shutters, windows and glass for other structures would seem to contemplate some type of standing construction with an exterior exposed to the elements, but not necessarily in the nature of a building strictly speaking. Item 15 “piles for structures” suggests that the structures contemplated are to rest on the ground. Supermarket shelves sit on the floor of a building or are fixed to the wall or to other fixtures in the building. They are not exposed to the elements and they do not rest on the ground.
14 Supermarket shelving might be considered to be analogous to interior fixtures. Item 10, providing for kitchen and bathroom cabinets, would seem to be, or at least come close to being, interior fixtures. However, it is significant that item 10 is limited to cabinets for kitchens and bathrooms. Clearly, cabinets in other rooms in a building are not contemplated. The indication is that interior fixtures within buildings are not generally contemplated except where expressly listed. To attempt to construe the term “other structures” in item 21 with undue breadth to include interior fixtures generally would appear to be inconsistent with Parliament's intention to limit the nature of interior fixtures that are entitled to a lower rate of tax.
15 Item 20 refers to showers, baths, basins and sinks. These are also in the nature of interior fixtures. However, again, the specific enumeration of such items suggests that those not mentioned are not intended for inclusion under the rubric “other structures”. In other words, a basin or tub constructed of fabricated steel might be considered an “other structure” in the broadest sense of that term but it is obvious that when Parliament intended that such interior items be entitled to the lower rate of tax, they were specifically listed, suggesting that reliance was not to be placed on the general term “other structures” for that purpose.
16 Further, furniture is specifically excluded. Item 11, providing for certain types of construction and building components expressly states “not including assembled or unassembled furniture”. While supermarket shelves are not furniture in the conventional sense, it does seem apparent that items in the interior of a building are, unless expressly listed in the Schedule, not contemplated.
17 If “other structures” in item 21 were to be construed as including supermarket shelves, any fabricated metal shelving in houses and other buildings would also be included. However, this would be inconsistent with the restrictive way in which the Schedule is worded with respect to items in the interior of a building.
18 On this analysis of Schedule V, Part I, I am satisfied that supermarket shelving provided by the plaintiff does not constitute “other structures” for the purposes of Schedule V, Part I, item 21 of the Excise Tax Act.
19 The appeal is dismissed with costs.
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