Carrothers,
J.A.:—This
is
a
further
appeal
by
the
Crown
from
the
judgment
of
the
Honourable
Judge
Boyle,
of
the
County
Court
of
Vancouver,
affirming
on
a
summary
conviction
appeal
to
him
the
decision
of
His
Honour
Judge
Bendrodt,
of
the
Provincial
Court
of
British
Columbia.
Judge
Bendrodt
had
acquitted
the
respondent
of
failing
to
provide
information
and
produce
documents
as
demanded
and
required
pursuant
to
the
provisions
of
subsection
231(3)
of
the
Income
Tax
Act
of
Canada,
thereby
committing
an
offence
contrary
to
the
provisions
of
subsection
238(2)
of
that
statute.
I
consider
the
circumstances
of
the
demand
and
of
the
refusal
to
be
important
and
significant.
The
respondent
Bruyneel
is
a
chartered
accountant
of
many
years
standing.
A
number
of
his
clients,
wishing
to
invest
in
an
apartment
project,
entered
into
an
assignment
and
pooling
agreement
and
purchased
an
apartment
building
in
Prince
George
which
was
later
sold
at
a
profit.
The
profit
accrued
to
the
clients
according
to
the
shares
provided
for
in
the
agreement.
The
individual
clients
wished
to
have
their
respective
shares
of
profit
from
the
sale
filed
for
income
tax
purposes
as
a
capital
gain
rather
than
as
income
from
a
venture
in
the
nature
of
trade.
For
some
reason
other
than
this
group
transaction
one
member
of
the
group
was
being
audited
by
the
Department
of
National
Revenue,
which
requested
a
copy
of
the
assignment
and
pooling
agreement
relating
to
the
apartment.
The
respondent
provided
a
copy
of
that
agreement
to
the
Department,
having
first
obliterated
the
identity
of
the
parties
to
the
joint
venture
other
than
the
member
being
audited.
The
respondent
received
a
letter
from
the
Department
of
National
Revenue
which
demanded
a
copy
of
the
agreement,
including
the
full
names
and
addresses
of
each
investor.
The
demand
directed
the
respondent's
attention
to
the
penalty
provided
for
in
subsection
238(2)
of
the
Income
Tax
Act
for
failure
to
comply.
The
respondent
wrote
to
the
Department
stating:
I
am
not
prepared
to
participate,
regardless
of
the
implications
of
s.231
and
238
of
the
Income
Tax
Act,
in
a
fishing
expedition.
I
am
prepared
to
supply
you
without
the
necessity
of
demand
information
with
respect
to
an
audit
on
any
of
the
clients
of
this
office.
That
simple
narrative
does
not
describe
fully
the
nature
of
the
demand.
the
trial
judge
in
his
reasons
for
judgment
quoted
the
following
passage
from
the
transcript
at
trial.
It
is
found
in
the
examination
in
chief
of
the
respondent,
who
was
the
only
defence
witness.
EXAMINATION
IN
CHIEF
BY
MR.
ANDERSON
Q.
Mr.
Bruyneel,
what
is
your
occupation?
A.
I'm
a
Chartered
Accountant.
Q.
Can
you
give
us
perhaps
some
background
with
respect
to
the
matter
at
hand?
A.
It
relates
to
an
investment
in
an
apartment
project
in
Prince
George
which
was
a
building
which
was
purchased
at
my
behest
by
a
group
of
clients
of
my
office
and
there
was
about
twelve
units,
investment
units
syndicated
and
the
—
the
building
was
subsequently
sold
at
a
profit.
The
—
to
the
best
of
my
recollection
all
of
my
clients
indicated
their
desire
to
file
the
gain
on
the
sale
as
capital
gain
as
opposed
to
a
venture
in
the
nature
of
trade
income.
Sometime
subsequent
to
that
one
of
my
clients
was
audited
and
for
no
particular
reason
related
to
that
building
and
that
transaction
was
examined
by
the
Auditors
and
there
eventually
in
the
exchange
of
information
they
asked
me
for
copies
of
the
joint
venture
agreement.
They
asked
me
for
copies
of
the
joint
venture
agreement,
among
other
things
and
I
provided
them
with
a
copy
of
that
agreement
with
the
names
of
the
other
members
of
the
syndicate
erased.
They
indicated
at
that
time
that
they
had
made
up
their
minds
that
my
client
was
to
be
taxed
as
a
venture
in
the
nature
of
trade
and
that
they
wished
to
have
the
names
of
the
other
people
involved.
I
indicated
to
them
that
I
was
not
prepared
to
give
them
that
information
because
of
the
confidential
nature,
in
my
opinion,
of
my
relationship
with
my
clients.
They
indicated
that
they
would,
if
I
did
not
provide
the
information,
that
they
would
assess
my
client
on
the
full
amount
of
the
gain
even
though
my
client
had
a
small
interest
in
the
building.
They
did,
in
fact,
assess
my
client
on
the
full
amount
of
the
gain
of
some
forty-eight
thousand
dollars
of
tax
on
the
thirty
thousand
dollar
gain.
I
indicated
to
—
I
indicated
by
correspondence
to
the
local
Director
of
the
Taxation
Office
my
concern
about
that
and
he
agreed
with
me
that
action
shouldn't
have
been
taken.
THE
COURT:
Do
you
mean
to
say
the
Income
Tax
Department
said
to
you
that
if
you
don't
provide
this
information
as
to
who
the
other
participants
were
in
this
joint
venture
—
A.
Yes.
THE
COURT:
—
then
this
one
person
that
we're
assessing
is
going
to
suffer
an
additional
penalty
and
be
assessed
for
the
whole
thing
in
spite
of
the
fact
that
they
are
aware
that
it
isn't
his
whole
thing?
A.
Yes,
sir,
yes,
Your
Honour.
They
said
that
to
myself
and
to
my
client.
They
subsequently
did
assess
that
amount
and
the
Director
agreed
with
me
that
—
that
it
was
out
of
line
completely.
I
indicated
to
him
in
a
letter
that
I
had
never
seen
anything
like
it
in
twenty-five
years
of
public
practice.
Subsequently,
some
months
later
after
some
considerable
distress
on
my
client’s
part,
the
amount
was
reversed.
They
continued
to
take
the
position
that
her
particular
gain
is
income
which
we
are
fighting
in
the
normal
course
and
they
indicated
to
me
at
the
time
they
would
look
to
me
to
provide
them
with
the
information
as
to
the
names
of
the
other
people
and
that
led
to
the
demand
letter
which
was
referred
to
earlier.
Q.
Now,
Mr.
Bruyneel,
the
specific
charge
here
relates
to
you
as
Director
of
Bruyneel
Management,
now
can
you
explain
the
relationship
there?
A.
Bruyneel
Management
is
a
—
I’m
the
only
Shareholder
and
Director
of
Bruyneel
Management.
It
was
used
in
this
matter
as
a
bare
trustee
to
hold
the
property
in
trust
for
the
beneficial
owners
for
purposes
of
facility
of
land
registration
and
dealing
with
the
properties
and
so
forth,
a
fairly
standard
procedure
in
these
matters.
Q.
Does
it
possess
any
information
other
than
the
information
that
you
have
as
Accountant?
A.
No.
While
the
matter
of
the
irregular
assessment
was
corrected
by
the
Director
and
is
not
strictly
before
us,
the
conduct
of
the
assessor
generated
uneasiness
and
lack
of
confidence
in
the
bona
fides
of
the
purpose
of
the
demand.
This
conduct
undoubtedly
influenced
the
respondent
to
take
the
position
he
did.
As
I
said
at
the
outset,
the
respondent
was
then
charged
with
failing
to
provide
information
and
to
produce
documents
as
required.
He
was
acquitted
at
trial
in
the
Provincial
Court,
a
decision
which
was
affirmed
in
the
County
Court.
The
Crown
appeals
this
affirmation
to
us.
The
relevant
sections
of
the
Income
Tax
Act
are
as
follows:
Sec.
231(3)
(3)
Idem.
The
Minister
may,
for
any
purposes
related
to
the
administration
or
enforcement
of
this
Act,
by
registered
letter
or
by
a
demand
served
personally,
require
from
any
person
(a)
any
information
or
additional
information,
including
a
return
of
income
or
a
supplementary
return,
or
(b)
production,
or
production
on
oath,
of
any
books,
letters,
accounts,
invoices,
statements
(financial
or
otherwise)
or
other
documents.
within
such
reasonable
time
as
may
be
stipulated
therein.
Sec.
231(10)
(10)
Compliance.
No
person
shall
hinder
or
molest
or
interfere
with
any
person
doing
anything
that
he
is
authorized
by
or
pursuant
to
this
section
to
do
or
prevent
or
attempt
to
prevent
any
person
doing
any
such
thing
and,
notwithstanding
any
other
law
to
the
contrary,
every
person
shall,
unless
he
is
unable
to
do
so,
do
everything
he
is
required
by
or
pursuant
to
this
section
to
do.
Sec.
238(2)
(11)
Idem.
Every
person
who
has
failed
to
comply
with
or
contravened
subsection
116(3),
127(3.1)
or
(3.2),
153(1),
227(5),
230.1(1)
or
230.1(2),
or
section
230
or
231
is
guilty
of
an
offence
and,
in
addition
to
any
penalty
otherwise
provided,
is
liable
on
summary
conviction
to
(a)
a
fine
of
not
less
than
$200
and
not
exceeding
$10,000,
or
(b)
both
the
fine
described
in
paragraph
(a)
and
imprisonment
for
a
term
not
exceeding
6
months.
The
pivotal
issue
is
whether
the
respondent,
as
a
chartered
accountant
in
the
particular
circumstances
of
this
case,
is
compelled
to
identify
his
clients
as
potential
taxpayers.
The
trial
judge
based
his
reasoning
upon
the
case
of
Canadian
Bank
of
Commerce
v.
Attorney-General
of
Canada,
[1962]
S.C.R.
729,
as
discussed
in
James
Richardson
&
Sons
Ltd.
v.
M.N.R.,
[1984]
C.T.C.
345;
[1984]
4
W.W.R.
577.
In
a
judgment
of
the
Supreme
Court
of
Canada
delivered
by
Madam
Justice
Wilson,
speaking
for
six
judges,
including
herself,
it
was
held
that
the
above
quoted
subsection
231(3)
is
only
available
to
the
Minister
to
obtain
information
relevant
to
the
tax
liability
of
some
specific
person
or
persons
if
the
tax
liability
of
such
person
or
persons
is
the
subject
of
genuine
and
serious
enquiry.
What
is
sought
by
the
Minister
in
this
case
is
not
information
relating
to
tax
liability,
but
the
very
identity
of
a
specific
taxpayer
or
taxpayers.
The
Minister
already
has
the
same
information
relating
to
tax
liability
with
respect
to
each
member
of
the
investment
group
and
what
the
Minister
is
asking
the
respondent
to
do
is
to
identify
the
specific
taxpayer.
The
irregular
threat
of
excessive
assessment
and
the
actual
excessive
assessment
to
persuade
the
respondent
to
abandon
his
position
of
confidentiality
speaks
for
itself
regarding
the
bona
fides
of
the
request
for
information.
The
respondent,
in
a
letter
to
the
Department,
made
it
abundantly
clear
that
he
was
ready
and
willing
to
provide
tax
liability
information
in
response
to
a
request
relating
to
specific
taxpayers.
I
am
of
the
opinion
that
this
case,
on
its
particular
facts,
falls
within
the
limitations
of
the
authority
of
the
Minister
to
make
demands
for
information
as
set
out
in
the
case
of
James
Richardson
&
Sons
Ltd.
v.
M.N.R.
In
the
result,
I
would
dismiss
this
appeal.
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