Shah v. The Queen, docket 2000-1194(IT)G

Date: 20021021

Docket: 2000-1194-IT-G

BETWEEN:

DR. JAY SHAH,

Appellant,

and

HER MAJESTY THE QUEEN,

Respondent.

Reasons for Judgment

Beaubier, J.T.C.C.

[1]            These appeals pursuant to the General Procedure were heard at Edmonton, Alberta on October 10, 2002. Dr. Shah was the only witness.

[2]            The chronology respecting these appeals is set out in Exhibit R-1 which reads as follows:

Chronology - Objection stage

Date	Stage	Counsel or self-represented
June 22, 1998	Initial assessment for 1997
November 9, 1998	Reassessment issued re 1997
April 28, 1999	Notice of Objection received re 1997	Self-represented
June 7, 1999	Appellant's written authorization permitting the CCRA to discuss tax matters with his solicitors
December 1, 1999	Notification of Confirmation re 1997	N/A
February 29, 2000	Notice of Appeal filed re 1997	Represented by Counsel
June 5, 2000	Reply filed / served Respondent's List of Documents filed / served
March 28, 2001	Notice to Cease to Act as Counsel filed by Appellant's counsel
April 19, 2001	Status hearing adjourned at request of Appellant	Self-represented through to hearing
May 28, 2002	Appellant's List of Documents served
June 11, 2002	Joint Application filed
June 27, 2002	Respondent's Supplementary List of Documents filed / served
June 28, 2002	Examination for discovery of the Appellant
July 22, 2002	Response to undertakings
September 12, 2002	Appellant's Amended Notice of Appeal served
September 23, 2002	Respondent consents to the filing of the Amended Notice of Appeal
September 30, 2002	Written offer of settlement made by Respondent
October 1, 2002	Reply to Amended Notice of Appeal filed
October 1, 2002	Second written offer of settlement made by Respondent, with "party and party costs pursuant to Tariff B - General Procedure as follows: a) under subsection 1(1), the amount of $250 pursuant to paragraph 1(1)(a); b) under subsection 1(2) disbursements consisting of i) the amount of $250 paid in respect of the filing fee; and ii) additional disbursements not exceeding $ 50"

[3]            The Amended Notice of Appeal filed on September 23, 2002 added the years 1996 and 1998 to the appeal. In paragraphs 17 to 20 inclusive of the Reply to the Amended Notice of Appeal filed on October 1, 2002, the Minister conceded all of the Amended Notice of Appeal except the Appellant's claims for damages and for solicitor-client costs. Paragraphs 17 to 20 of the Reply to the Amended Notice of Appeal read:

Issue (a):                whether the amounts of $50,000; $130,000 and $76,308.67 were properly included in the Appellant's income for the 1996, 1997 and 1998 taxation years;

17.            The Minister concedes the appeal on this point and takes the position that the assessments in issue should be varied to remove these amounts from income on the basis that they are not taxable.

Issue (b):                whether the amount of $226,447.70, constituting pre-judgment interest, was properly included in the Appellant's income for the 1998 taxation year;

18.            The Minister concedes the appeal on this point and takes the position that the assessment in issue should be varied to remove this amount from income on the basis that it is not taxable.

Issue (c):                whether the relief requested by the Appellant in paragraph 23(5) of his Amended Notice of Appeal ("a mandatory order against continuing harassment by the CCRA and a speedy resolution of the remaining tax issues") is relief which can be granted by this Honourable Court.

19.            He submits that to the extent that the Appellant is seeking a prerogative remedy, this Honourable Court is without the statutory jurisdiction to grant such a remedy.

20.            The Deputy Attorney General requests that with respect to this issue, the appeal be quashed.

[4]            During the hearing, from the bench, the Court:

1.              Dismissed the claim for damages on the basis that this Court has no jurisdiction to award damages.

2.              Dismissed the appeal on the foregoing basis and on the basis that the Appellant's other claims had been conceded in the Amended Reply.

3.              Allowed evidence to be called by the Appellant on the question of costs.

[5]            Respondent's counsel advised the Court that the Respondent had offered the Appellant the following on account of costs:

1.	Respecting the original Notice of Appeal filed by the Appellant's solicitor	$250.00
2.	On account of estimated disbursements	$300.00
Total		$550.00

[6]            Dr. Shah testified that his actual disbursements, aside from solicitor's fees amounted to $558.50. His evidence on this point is accepted as true and he is awarded that sum as disbursements in any event.

[7]            Dr. Shah testified in some detail respecting his solicitor's fees. The only document filed in Court by his solicitor and the only Court activities on record by his solicitor are the following:

1.              February 29, 2000, prepared and filed Notice of Appeal for 1997.

2.              June 5, 2000, received Respondent's

                (a)            Reply

                (b)            List of Documents.

In addition, the Appellant's solicitor had to have agreed to extend the time to file the Reply.

3.              Before March 28, 2001, received Notice of Status Hearing.

4.              March 28, 2001, filed Notice to Cease to Act as counsel for the Appellant.

[8]            Dr. Shah testified as to the cause of the objections and appeals. He incurred long and distressful, but successful, litigation in the Alberta Court of Queen's Bench and Court of Appeal for which he was awarded substantial damages and interest against the Province of Alberta. Thereupon, in order to receive his disability entitlements from the Province of Alberta, he was required to make almost equally substantial payments to both federal and provincial authorities. As a result of these occurrences, he was reassessed under section 6 of the Income Tax Act (the "Act").

[9]            The Court accepts Dr. Shah's testimony that the income tax objection and appeal process for all the years was a long and involved process. All of these processes are long and involved, but Dr. Shah's were more than most individuals are because of the fact that he won "damages" and interest, but had to pay the government of Alberta large sums of money on account of his entitlement to a disability pension. There has been, and continues to be, considerable tax litigation respecting section 6 of the Act on matters related to Dr. Shah's matters.

[10]          Dr. Shah testified that his legal bills from his tax lawyer totalled $10,500. The first bills he paid totalled $5,474.28 before the Notice of Appeal was filed. On February 29, 2000, the date on which the Notice of Appeal for 1997 was filed by his solicitor, he was billed $7,594.44. On March 24, 2000, he was billed a further $1,232.26. He paid $4,548.32 on these bills on or before December 20, 2000. There is also reference to two other relatively small amounts in Exhibit A-1.

[11]          Dr. Shah did not provide any evidence that justified an award of solicitor-client costs. In particular, there is no evidence of undue delay, inappropriate procedural wrangling or inappropriate prolongation of the proceedings or any other matter which constitutes reprehensible, scandalous or outrageous conduct by the Respondent, its staff or its counsel. In fact, Respondent's counsel consented to the Amended Notice of Appeal at virtually the last minute and it added two years to the appeals before this Court.

[12]          For these reasons, the Court finds that the Appellant is entitled to his disbursements and to party and party costs in this Amended appeal calculated as follows:

1.	Disbursements	$558.50
2.	Preparing and filing Notice of Appeal for 1996 and services prior to Examination for Discovery	$250.00
Total		$808.50

[13]          For the foregoing reasons these appeals are dismissed and the Appellant is awarded party and party costs which are fixed at $808.50.

Signed at Saskatoon, Saskatchewan, this 21st day of October, 2002.

"D. W. Beaubier"

J.T.C.C.COURT FILE NO.:                                   2001-1194(IT)G

STYLE OF CAUSE:                                               Dr. Jay Shah v. Her Majesty the Queen

PLACE OF HEARING:                                         Edmonton, Alberta

DATE OF HEARING:                                           October 10, 2002

REASONS FOR JUDGMENT BY:      The Honourable Judge D. W. Beaubier

DATE OF JUDGMENT:                                       October 21, 2002

APPEARANCES:

For the Appellant:                                                 The Appellant himself

Counsel for the Respondent:              Julia S. Parker

COUNSEL OF RECORD:

For the Appellant:                

Name:                               

Firm:                 

For the Respondent:                             Morris Rosenberg

                                                                                Deputy Attorney General of Canada

                                                                                                Ottawa, Canada

2000-1194(IT)G

BETWEEN:

DR. JAY SHAH,

Appellant,

and

HER MAJESTY THE QUEEN,

Respondent.

Appeals heard on October 10, 2002 at Edmonton, Alberta, by

the Honourable Judge D. W. Beaubier

Appearances

For the Appellant:                                                                 The Appellant himself

Solicitor for the Respondent:                              Julia S. Parker

JUDGMENT

                The appeals from the reassessments made under the Income Tax Act for the 1996 and 1997 taxation years and the assessment made under the Income Tax Act for the 1998 taxation year are dismissed, with costs in favour of the Appellant, in accordance with the attached Reasons for Judgment.

Signed at Saskatoon, Saskatchewan, this 21st day of October, 2002.

"D. W. Beaubier"

J.T.C.C.