Thomas v. R., [2011] GSTC 129, 20112011 TCC 421

The Appellant (an optometrist practising in Unity and Meadow Lake, Saskatchewan), who owned 75% of the shares of a corporation holding three commercial properties in a different city, was found by McArthur J to be an outside director of the corporation (with limited business experience) who had left responsibility for GST and accounting matters to the minority shareholder, who was the Appellant's investment advisor. The due diligence test had been met notwithstanding that the GST remittance failures in question had extended over a period of six years, and the Appellant had been required to inject additional capital into the corporation towards the end of the fifth year.

Although the corporation of which the Appellant was a director was struck from the Saskatchewan Corporate Register more than two years before the assessments of the Appellant under s. 323, MacArthur J found that it was not possible to resolve whether or not the Appellant thereby ceased to be a director without evidence that the corporation also was dissolved. (However, he found that the due diligence test had been met.)