Reed,
J.:—The
Minister
of
National
Revenue
seeks
an
order
pursuant
to
subsection
231.3(6)
of
the
Income
Tax
Act,
R.S.C.
1952,
c.
148
(am.
S.C.
1970-71-72,
c.
63)
(the
"Act")
allowing
him
to
retain
documents
seized
from
certain
of
the
respondents,
as
well
as
from
the
firm
of
accountants,
Thorne,
Ernst
and
Whinney
and
from
the
solicitors,
Walsh
Micay,
and
some
others.
The
documents
were
seized
on
May
7,
1987,
upon
execution
of
warrants
which
had
been
issued
by
Mr.
Justice
McNair,
pursuant
to
section
231.3
of
the
Income
Tax
Act.
Counsel
for
some
of
the
respondents
seeks
an
order
for
the
cross-
examination
of
Philip
G.
Seagle
and
Maurice
K.C.
Ma.
He
seeks
to
cross-
examine
these
individuals
on
the
affidavits
and
reports
to
a
judge
which
they
filed,
in
support
of
the
Minister’s
application
for
an
order
allowing
retention
of
the
documents.
There
is
no
material
filed
by
the
respondents
stating
why
such
cross-
examination
should
be
provided
nor
stating
what
purpose
would
be
served
thereby.
Counsel,
in
argument,
stated
that
he
wished
to
cross-examine
the
two
affiants
because:
(1)
he
was
of
the
view
that
the
requirements
of
subsection
231.3(5)
had
not
been
complied
with;
the
reports
in
question
had
not
been
made
to
a
judge
“as
soon
as
practicable”
after
the
seizure;
and
(2)
he
was
of
the
view
that
the
two
affiants
were
not
the
individuals
who
had
executed
the
search
warrants
and,
therefore,
subsection
231.3(5)
had
not
been
complied
with
in
this
respect
either.
I
first
of
all
note,
with
respect
to
the
allegation
that
the
reports
were
not
made
"as
soon
as
practicable”,
that,
although
the
documents
were
seized
on
May
7,
1987,
they
were
sealed
and
kept
in
the
custody
of
the
Court
while
the
validity
of
the
search
and
seizure
warrants
was
challenged.
That
challenge
was
not
resolved
until
the
Supreme
Court
refused,
on
November
23,
1989,
leave
to
appeal
the
Federal
Court
of
Appeal
decision
reported
at
[1986]
2
C.T.C.
38;
86
D.T.C.
6275.
It
was
only
after
that
date
that
officials
of
the
Department
of
National
Revenue
obtained
access
to
the
documents.
Thus,
it
can
only
be
from
that
date
that
any
possible
argument
concerning
lack
of
expedition
might
lie.
Counsel
for
the
respondents'
arguments
proceeded
from
that
starting
point.
The
respondents
on
whose
behalf
the
applications
to
cross-examine
were
made
are:
Organic
Research
Inc.,
Solvent
Petroleum
Extraction
Inc.,
Seona
Wilder,
Dara
Wilder
and
Ronald
Johnson.
The
two
firms
Thorne,
Ernst
&
Whinney
and
Walsh
Micay
filed
letters
consenting
to
the
Minister's
retention
of
the
documents
seized
from
them.
The
remaining
respondents,
named
in
the
retention
orders
sought,
apparently
could
not
be
reached
by
their
counsel
for
the
purpose
of
obtaining
any
instructions
with
respect
to
the
present
application.
I
do
not
propose
to
address
questions
concerning
the
extent
of
discretion
which
exists
in
a
judge
pursuant
to
subsection
231.3(6).
See,
for
example,
Re
F.
Hertel
et
al.,
[1987]
1
C.T.C.
15.
I
do
not
propose
to
address
the
question
of
when
a
judge
might
grant
an
order
for
cross-examination
of
a
person
filing
a
report
in
compliance
with
subsection
231.3(5),
before
issuing
a
retention
order
under
subsection
231.3(6).
It
suffices
for
the
present
case
to
say
that
I
am
not
convinced
that
any
useful
purpose
would
be
served
by
granting
the
orders
for
cross-examination
which
are
sought.
While
counsel
for
the
respondent
argues
that
a
retention
order
pursuant
to
subsection
231.3(6)
can
only
be
issued
on
the
basis
of
a
“valid”
report
being
filed
pursuant
to
subsection
231.3(5)
and
that
a
"valid"
report
only
exists
if
it
has
been
made
“as
soon
as
practicable”
after
the
seizure,
I
do
not
find
that
that
conclusion
flows
from
the
text
of
the
legislative
provisions
in
question.
The
issuing
of
a
retention
order
is
not
made
conditional
upon
the
report
having
been
made
“as
soon
as
practicable”.
That
admonition
is
directory
rather
than
mandatory
in
nature.
(I
use
mandatory
here
in
the
sense
that
a
failure
to
comply
with
the
admonition
would
result
in
an
invalid
report
and
vitiate
any
retention
order
given.)
There
is
nothing
in
the
subsections
in
question
which
expressly
dictates
the
consequences
of
non-compliance
with
the
direction
that
a
report
be
made
“as
soon
as
practicable”.
The
direction
is
not
precise
enough
to
admit
of
a
conclusion
that
it
was
intended
that
any
report
which
did
not
satisfy
the
direction
would
be
invalid
and
therefore
prevent
a
retention
order
being
made.
In
the
absence
of
an
express
provision
requiring
such
a
result,
I
would
not
be
prepared
to
interpret
the
legislative
provisions
as
counsel
for
the
respondents
argues,
particularly,
in
a
case
such
as
the
present,
where
there
is
absolutely
no
prejudice
occurring
to
the
respondents.
Counsel
for
the
Minister
indicated
that
the
respondents
have
long
been
in
possession
of
copies
of
all
the
documents
which
were
seized
from
the
various
respondents
named
in
the
retention
orders
sought.
Thus,
even
if
the
reports
to
a
judge
had
not
been
filed
as
soon
as
practicable,
the
result
the
respondents
seek
would
not
follow.
In
the
circumstances
of
this
case,
it
is
my
conclusion
that
ordering
the
cross-
examinations
which
are
sought
would
be
nothing
more
than
a
waste
of
time
and
money.
It
has
not
been
shown
that
they
would
serve
any
useful
purpose.
With
respect
to
the
allegation
that
the
persons
executing
the
various
warrants
were
not
those
who
reported
to
the
Court,
I
do
not
read
the
reports
as
containing
that
defect.
The
warrants,
which
issued,
authorized
a
number
of
individuals
to
enter
and
search
for
the
documents
in
question.
For
example,
the
warrant
pertaining
to
Solvent
Petroleum
Extraction
Inc.
authorized
ten
persons
to
enter
and
search
and
seize
documents
or
things:
Culligan,
Hains,
Lee,
McNeill,
Newlands,
Robertson,
Seaker,
Steele,
Willisko,
Brooks.
The
report
to
a
judge
is
signed
by
a
Mr.
Seagle
who
is
an
officer
of
Revenue
Canada.
That
report
indicates
that
the
authorized
officers
Culligan,
Hains,
Lee,
McNeill,
Robertson
and
Willisko
entered
the
premises
in
question,
searched
and
seized
the
documents
and
things
which
are
listed
in
the
report.
Mr.
Seagle
is
described
in
the
report
as
being
the
person
presently
"detaining"
the
seized
materials.
The
report,
while
signed
by
Mr.
Sea
le,
is
expressed
to
be
made
not
only
on
his
behalf
but
also
on
behalf
of
the
officers
who
originally
seized
the
documents.
Paragraph
17
of
the
report
states:
The
aforementioned
officers
and
I
do
hereby
make
a
report
in
respect
of
the
seizure
of
these
documents
or
things
as
required
by
section
231.3
of
the
Income
Tax
Act,
and
I
hereby
apply
for
an
Order
for
Retention
thereof
pursuant
to
subsection
231.3
(6)
of
the
said
Act.
All
the
reports,
filed
in
support
of
the
retention
orders
sought,
contain
a
comparable
provision.
For
the
reasons
given
the
orders
for
retention
will
be
granted,
the
respondents'
applications
for
an
order
seeking
cross-examination
of
Mr.
Seagle
and
Mr.
Ma
will
be
dismissed.
Minister's
order
granted;
respondent's
applications
dismissed.
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