Date: 20020315
Docket: 2000-3643-IT-G,
2001-582-IT-G
BETWEEN:
JAMES E. ADAMSON,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
Reasonsfor
Orders
Mogan J.
[1]
The Appellant has commenced two separate appeals in this Court.
His appeal for the 1998 taxation year is Court File
2000-3643(IT)G and his appeal for the 1999 taxation year is Court
File 2001-582(IT)G. Before filing a Reply to either Notice of
Appeal, the Respondent brought motions to strike out certain
parts of each Notice of Appeal. The Notices of Appeal are drafted
in a similar style. Accordingly, the Respondent's motions are
based on similar arguments.
[2]
After the Respondent filed its first Notice of Motion (for 1998
on Court File 2000-3643) supported by the affidavit of one
William J. Barnard, the Appellant cross-examined Mr. Barnard on
his affidavit. Following the cross-examination, the
Appellant brought a motion to compel Mr. Barnard to
re-attend to answer certain questions which were objected
to, refused or not prepared with adequate information. The
Respondent's two motions and the Appellant's motion were
all set down for hearing at Toronto on April 18, 2001. I propose
to consider first the Respondent's motions because, depending
upon the results, certain of the questions cited in the
Appellant's motion may or may not be relevant.
[3]
In the Respondent's motion for the 1998 taxation year (Court
file 2000-3643), the Respondent seeks the following
relief:
THE MOTION IS FOR orders:
1.
striking out paragraphs 3, 6 and 7, and subparagraph 10(i)(a) of
the Notice of Appeal pursuant to section 53 of the Tax Court
of Canada Rules (General Procedure) (the
"Rules");
2.
striking out paragraph 8 and subparagraph 10(ii) of the Notice of
Appeal pursuant to paragraph 58(3)(a) of the
Rules;
3.
granting the Respondent, pursuant to subsection 12(1) of the
Rules, an extension of time in which to file and serve Her
Reply to the Notice of Appeal;
4.
awarding costs of this motion to the Respondent pursuant to
section 147 of the Rules; and
5.
for such further relief as counsel may advise and this Honourable
Court deems just.
In order to consider the merits of the Respondent's
motion, I will set out the entire Notice of Appeal for 1998 so
that those portions which the Respondent wants to strike out may
be read in context:
NOTICE OF APPEAL (1998)
a.
Appellant's Address & Province in Which Appeal
Instituted
1.
The Appellant's home address is as follows:
James E. Adamson
Suite C-3 296 Mill Road
Toronto, ON M9C 4X8
The Province in which the Appeal is instituted is Ontario.
b.
The Assessment under Appeal
2.
The notice of assessment has no assessment number but bears the
Appellant's Social Insurance No. 321-662-396, is dated Sept.
14, 1999, and is for taxation year 1998.
c.
The Material Facts
3.
The Appellant lost $230,000 in professional receivables in
1995-96 from the practice of law and was assessed income on the
basis of the billings as though he had received the revenues and
resulting income. His objection claiming deductions of reserves
for doubtful and bad debts was denied on the basis that the
losses had occurred in the "stub" year when
professionals were required to start filing on a calendar year
basis and the losses had to be spread over the following 10
years: The full taxes were payable but only 1/10 of the losses
could be deducted.
4.
The Appellant's 1998 return erroneously included $50,000 in
1995-96 tax paid receipts finally collected in 1998 from the
$230,000 bad receivables.
5.
Moreover, the Appellant's subsequently filed GST return
revealed that his 1998 income was overstated by $10,000. The
Respondent has the particulars.
6.
Due to the said loss of receivables the Appellant was not
generating receivables to pay his share of office overhead at his
prior law firm. Accordingly he assigned to the firm his entire
professional revenues until his arrears of his share of office
overhead became current and lived off of his RSP savings and
thereby lost nearly half his life savings. He had no income from
his practice for approximately 9 months during 1996 and 1997
while all of his revenues were so required to be paid to his
prior law firm and he started over to rebuild his receivables
from nothing.
7.
Being assessed on artificial income - as though the bad
receivables had actually been paid back in 1995 and 1996 -
and the Appellants income level since then which now has levelled
off for the remaining 5 years of his working life, mean he has
been permanently pushed back approximately one year in his
ability to pay his income tax. It is the accumulating tax arrears
interest and instalment interest due to the said 1995 assessment
in the taxation years since 1995 which have put the Appellant
permanently behind.
8.
Pursuant to s. 220(3.1) of the Income Tax Act, the
Appellant seeks a waiver of all arrears and instalment interest
and penalties paid resulting from the 1995 assessment of
receivables which were not received within 6 months of being
billed, and a waiver of all such further interest charges on
income tax in subsequent taxation years due to his 1995
assessment.
9.
By notice of assessment bearing Appellant's Social Insurance
No. 321-662-396, dated Sept. 14, 1999 for taxation year
1998, the Minister erroneously assessed the Appellant for $50,000
tax paid receipts collected in that year from bad receivables
from 1995-96; for more than $10,000 of 1998 income that was
erroneously overstated; and assessed $30,000 to $35,000 in
interest arrears and penalties, the calculations of which are
known only to the Respondent.
d.
Issues to be Decided
10.
The issues are:
(i)
whether the Appellant has been wrongly assessed on;
(a)
1995 or 1996 income on which income tax has been assessed and
paid, and
(b)
overstated income for 1998 as revealed in his GST filing, and
(ii)
whether pursuant to s. 220(3.1) of the Income Tax Act, the
Appellant should be entitled to a waiver of part or all arrears
and instalment interest and penalties paid and accruing since
1995 resulting from the 1995 assessment of receivables which were
not in fact paid in 1995 or 1996 but nonetheless were included in
his income for tax purposes.
e.
Statutory Provisions
11.
The Appellant relies on Income Tax Act of Canada Sections
12(1)(a)(b)(d)(l)(m) &
(p); 20(1)(b) & (p); 34; 34.1; 220(3.1);
249 and such further provisions as he or counsel may advise.
f.
Reasons
The Appellant's reasons as are set out above in the Material
Facts.
g.
Relief Sought
12.
The Appellant seeks affirmative answers to the above Issues to be
Decided and an order referring the assessment back to the
Minister for reconsideration and reassessment in accordance with
the Court's reasons.
[4]
The Respondent relies on section 53 of the Tax Court of Canada
Rules (General Procedure) hereinafter called the
"G.P. Rules" in the motion to strike out
paragraphs 3, 6 and 7 and subparagraph 10(i)(a) of the Notice of
Appeal. Section 53 provides:
53
The Court may strike out or expunge all or part of a pleading or
other document, with or without leave to amend, on the ground
that the pleading or other document,
(a)
may prejudice or delay the fair hearing of the action,
(b)
is scandalous, frivolous or vexatious, or
(c)
is an abuse of the process of the Court.
I will consider the application of section 53 of the G.P.
Rules to each of the impugned paragraphs. According to
paragraph 2 of the Notice of Appeal, the only taxation year under
appeal is 1998. Therefore, the Appellant may challenge the
Minister's assessment of tax or interest or penalty with
respect to his 1998 taxation year.
[5]
Paragraph 3 of the Notice of Appeal alleges a substantial loss in
1995-1996 in professional receivables. At first blush, a loss in
receivables in 1995-1996 is not relevant when challenging an
assessment for 1998. It is possible, however, that the Appellant
had a business loss in either or both of those years and received
a "nil assessment" which was not appealable. It is also
possible that the Appellant's 1998 taxation year is the first
year when he could carry forward a business loss from 1995 or
1996. Paragraph 3 refers to recent legislation which requires
professionals to compute income on the basis of a calendar year
with a 10-year deferral provision. Here again, the deferral from
1995 or 1996 may have a bearing on the Appellant's 1998
income or taxable income.
[6]
Although this appeal for 1998 is under the Court's General
Procedure, the Appellant appears to have drafted his own
pleading and, upon the hearing of this motion, he appeared on his
own behalf without the benefit of legal counsel. The Appellant is
a practising lawyer in Toronto but I assume from the content of
his Notice of Appeal that he does not practise in the area of tax
litigation. Accordingly, I regard the Appellant as an ordinary
non-lawyer taxpayer attempting to plead his own case in Court.
His Notice of Appeal for 1998 is a rambling and imprecise
document. It fails to articulate any reasonable allegation with
respect to the computation of income or taxable income for 1998.
I have had to assume, for the Appellant's benefit, that there
is or may be an issue concerning the carry forward of a loss from
1995 or 1996 (making relevant the computation of such loss) or
concerning the deferral of professional income as a consequence
of recent legislation.
[7]
In my opinion, section 53 of the G.P. Rules cannot be
invoked to strike out paragraph 3 of the Notice of Appeal. I have
already observed that the Notice of Appeal is rambling and
imprecise but it is the work of an ordinary taxpayer attempting
to plead his own case. I cannot find anything in paragraph 3
which I would regard as "scandalous, frivolous or
vexatious" or an abuse of the Court process. Similarly, I
find nothing in paragraph 3 that may prejudice or delay the fair
hearing of the appeal for 1998. It seems to me that the
Respondent may have been better advised to demand particulars
under section 53 of the G.P. Rules rather than attempt to
strike out paragraph 3 under section 53.
[8]
Everything stated above concerning section 53 of the G.P.
Rules and paragraph 3 of the Notice of Appeal has equal
application to paragraphs 6 and 7 of the Notice of Appeal. I will
not invoke section 53 to strike out paragraph 3 or 6 or 7 of the
Notice of Appeal.
[9]
Subparagraph 10(i)(a) of the Notice of Appeal is in a different
category. In paragraph 10, the Appellant is attempting to state
the issues to be decided. Those issues must relate to the
Appellant's most recent assessment for 1998 because that is
the only assessment under appeal. In subparagraph 10(i)(a), the
Appellant attempts to bring before the Court the question of
whether he has been wrongly assessed on "1995 or 1996
income". This is an overt attempt to dispute assessments for
taxation years (1995 or 1996) which are not under appeal.
I have no hesitation in applying paragraph 53(a)
of the G.P. Rules to subparagraph 10(i)(a) of the
Notice of Appeal. I find that the inclusion of subparagraph
10(i)(a) within the Notice of Appeal would prejudice or delay the
fair hearing of the appeal with respect to the Appellant's
1998 taxation year. Accordingly, I will order that subparagraph
10(i)(a) be struck out.
[10] I now
turn to the second part of the Respondent' motion that
paragraph 8 and subparagraph 10(ii) of the Notice of Appeal be
struck out pursuant to paragraph 58(3)(a) of the G.P.
Rules which provides:
58(3) The respondent may
apply to the Court to have an appeal dismissed on the ground
that,
(a)
the Court has no jurisdiction over the subject matter of an
appeal,
(b)
...
and the Court may grant judgment accordingly.
[11] Paragraph
8 and subparagraph 10(ii) of the Notice of Appeal have a common
theme. They both refer to subsection 220(3.1) of the Income
Tax Act concerning a waiver of interest and penalties
"resulting from the 1995 assessment". Subparagraph
10(ii) raises the question whether "pursuant to subsection
220(3.1) of the Income Tax Act, the Appellant should be
entitled to a waiver ...". That particular subsection
grants a discretion to the Minister as follows:
220(3.1)
The Minister may at any time waive or cancel all or any portion
of any penalty or interest otherwise payable under this
Act by a taxpayer or partnership and, notwithstanding
subsections 152(4) to (5), such assessment of the interest and
penalties payable by the taxpayer or partnership shall be made as
is necessary to take into account the cancellation of the penalty
or interest.
Under subsection 220(3.1), the Minister has discretion to
waive any penalty or interest. I have two reasons for granting
the Respondent's motion and striking out paragraph 8 and
subparagraph 10(ii) of the Notice of Appeal.
[12] The first
reason for striking out is the Appellant's overt attempt to
dispute and litigate his 1995 assessment of income tax when the
only taxation year under appeal is 1998. Both of the impugned
paragraphs refer to interest and penalties "resulting from
the 1995 assessment". If the Appellant received a notice of
assessment for his 1995 taxation year levying interest or
penalties or both, he could have and, perhaps, should have
appealed from that assessment. He cannot use his valid appeal for
the 1998 taxation year to go back and challenge one or more
assessment for the 1995 taxation year. Paragraph 8 and
subparagraph 10(ii) have no place in an appeal for the 1998
taxation year. Although this Court has jurisdiction to hear a
valid appeal from any assessment of income tax, the Appellant
does not have a valid appeal for his 1995 taxation year.
[13] The
second reason for striking out is based upon the discretion
granted to the Minister under subsection 220(3.1). In Floyd
Estate v. M.N.R., 93 DTC 5499, Dubé J. of the Federal
Court Trial Division stated at page 5500:
The new subsection 220(3.1) is applicable with respect to
penalties and interest from the 1985 taxation year but no
decision has yet been released on its interpretation.
At the outset, I should point out that it is not for the Court
to decide whether the interest otherwise payable by the taxpayer
ought to be waived or cancelled. It is within the discretion of
the Minister. The function of the Court in this judicial review,
as I understand it, is to determine whether or not the Minister
failed to observe procedural fairness or erred in law in making
his decision, as outlined under subsection 18.1(4) of the
Federal Court Act.
In Kaiser v. M.N.R., 95 DTC 5187, Rouleau J. set out
subsection 220(3.1) and then stated at page 5188:
The purpose of this legislative provision is to allow Revenue
Canada, Taxation, to administer the tax system more fairly, by
allowing for the application of common sense in dealing with
taxpayers who, because of personal misfortune or circumstances
beyond their control, are unable to meet deadlines or comply with
rules under the tax system. The language used in the section
bestows a wide discretion on the Minister to waive or cancel
interest at any time. To assist in the exercise of that
discretion, policy guidelines have been formulated and are set
out in Information Circular 92-2.
The jurisprudence has established the standard to be employed
by the Courts when called upon to review the exercise of a
discretionary power such as the one in question here. In Re
Maple Lodge Farms Ltd. and Government of Canada et al.
(1982), 137 D.L.R. (3d) 558 (S.C.C.), McIntyre, J. stated at
p. 562:
In construing statutes such as those under consideration in
this appeal, which provide for far-reaching and frequently
complicated administrative schemes, the judicial approach should
be to endeavour within the scope of the legislation to give
effect to its provisions so that the administrative agencies
created may function effectively, as the legislation intended. In
my view, in dealing with legislation of this nature, the courts
should, wherever possible, avoid a narrow, technical
construction, and endeavour to make effective the legislative
intent as applied to the administrative scheme involved. It is,
as well, a clearly-established rule that courts should not
interfere with the exercise of a discretion by a statutory
authority merely because the court might have exercised the
discretion in a different manner had it been charged with that
responsibility. Where the statutory discretion has been exercised
in good faith and, where required, in accordance with the
principles of natural justice, and where reliance has not been
placed upon considerations irrelevant or extraneous to the
statutory purpose, the courts should not interfere.
[14] The
Appellant seems to think that this Court can compel the Minister
to exercise his/her discretion under subsection 220(3.1) in a
particular way. This Court has no jurisdiction over the Minister
in the proposed exercise of discretion under subsection 220(3.1).
If the Appellant were to request a waiver of interest or
penalties under subsection 220(3.1), and if the Minister were to
refuse the request, the Appellant could commence a proceeding in
the Federal Court to review the Minister's exercise of
discretion with respect to procedural fairness or error of law
but that proceeding would start after the Minister had actually
exercised his/her discretion under subsection 220(3.1).
[15] In his
claim with respect to subsection 220(3.1), the Appellant is
premature because he has not yet asked for relief from interest
or penalties; and he is in the wrong Court. I will grant the
Respondent's motion and strike out paragraph 8 and
subparagraph 10(ii) of the Notice of Appeal because this Court
does not have jurisdiction to compel the Minister to exercise
his/her discretion under subsection 220(3.1) in a particular
way; nor does this Court have jurisdiction to review the manner
in which the discretion was exercised.
[16] The
Respondent's second motion seeks the following relief with
respect to the Appellant's Notice of Appeal for the 1999
taxation year:
THIS MOTION IS FOR orders:
1.
striking out paragraphs 5, 6, 7, 8 and 10 of the Notice of Appeal
pursuant to section 53 of the Tax Court of Canada Rules
(General Procedure) (the "Rules");
2.
striking out paragraphs 4, 9 and subparagraph 11(ii) of the
Notice of Appeal pursuant to paragraph 48(3)(a) of the
Rules;
3.
granting the Respondent, pursuant to subsection 12(1) of the
Rules, an extension of time in which to file and serve Her
Reply to the Notice of Appeal;
4.
awarding costs of this motion to the Respondent pursuant to
section 147 of the Rules; and
5.
for such further relief as counsel may advise and this Honourable
Court deems just.
I will set out the entire Notice of Appeal for 1999 so that
those portions which the Respondent wants to strike out may be
read in context:
NOTICE OF APPEAL (1999)
a.
Appellant's Address & Province in Which Appeal
Instituted
1.
The Appellant's home address is as follows:
James E. Adamson
Suite C-3 296 Mill Road
Toronto, ON M9C 4X8
The Province in which the Appeal is instituted is Ontario.
b.
The Assessment under Appeal
2.
The notice of assessment states the Appellant's Social
Insurance No. 321-662-396, is dated July 11, 2000, and is for
taxation year 1999.
c.
The Material Facts
3.
On June 14, 2000, the Appellant duly filed his 1999 Income Tax
Return by mail prior to his June 15, 2000 filing date prescribed
in S. 150(1)(d) of the Income Tax Act. The Minister
has wrongly assessed the Appellant for $3,907.34 for late filing
penalties.
4.
The Appellant should be allowed a credit against taxes assessed
of $90,000 or more (the exact calculation of which is available
to the Minister on information only partially made available to
the Appellant) pursuant to S. 220(3.1) of the Income Tax
Act, under which the Appellant should be entitled to a waiver
of part or all arrears and instalment interest and penalties, of
or exceeding $90,000, paid and accruing since 1995 which result
from the Minister's 1995 assessment of the taxpayer,
including in his income receivables which were not in fact
received by the Appellant in 1995 or 1996, but nonetheless were
included in his income for tax purposes.
5.
The Appellant lost $230,000 in professional receivables in
1995-96 from the practice of law and was assessed income on the
basis of the billings as though he had received the revenues and
resulting income. His objection claiming deductions of reserves
for doubtful and bad debts was denied on the basis that the
losses had occurred in the "stub" year when
professionals were required to start filing on a calendar year
basis and the losses had to be spread over the following 10
years: The full taxes were payable but only 1/10 of the losses
could be deducted.
6.
The Appellant was compelled to financially start over and rebuild
his practice from nothing; starting with no revenues or income.
Due to the said loss of receivables the Appellant was not
generating receivables to pay his share of office overhead at his
prior law firm. Accordingly he assigned to the firm his entire
professional revenues until his arrears of his share of office
overhead became current and lived off of his RSP savings and
thereby lost nearly half his life savings during the years it
took to rebuild his practice month by month. He had no income
from his practice for approximately 9 months during 1996 and 1997
while all of his revenues were so required to be paid to his
prior law firm and he thereafter started over to rebuild his
receivables from nothing month by month.
7.
Being assessed on artificial income - as though the bad
receivables had actually been paid back in 1995 and 1996 -
and the Appellant's income level since then which now has
levelled off for the remaining 5 years of his working life, means
he has been permanently pushed back approximately one and
one-half years in his ability to pay his income tax. It is the
accumulating tax interest arrears, instalment interest and
penalties due to the said 1995 assessment in the taxation years
since 1995 which have put the Appellant permanently behind.
8.
Each year all the Appellant's payments on account of tax are
needed to pay off taxes from prior years. Compounding interest is
making the tax debt grow and the taxpayer is falling further
behind. He has no reasonable hope of generating enough
professional income in his remaining 5 years before retirement to
ever pay off the arrears.
9.
Pursuant to S. 220(3.1) of the Income Tax Act, the
Appellant seeks a waiver of all arrears and instalment interest
and penalties paid resulting from the 1995 assessment of
receivables which were not received within 6 months of being
billed, and a waiver of all such further interest charges on
income tax in subsequent taxation years due to his 1995
assessment.
10.
By notice of assessment bearing Appellant's Social Insurance
No. 321-662-396, dated July 11, 2000 for taxation year 1999, the
Minister erroneously assessed the Appellant for $38,162 federal
and $20,007 Ontario tax without allowing any deductions or
credits for arrears and instalment interest and penalties
resulting from the 1995 assessment of receivables which were
never in fact received in 1995 or 1996 but nonetheless were
included in his income for tax purposes, and wrongfully assessed
for the said $3,907.34 late filing penalties, and $4,200 more
arrears and instalment interest. The Appellant duly objected and
by notification dated November 17, 2000 the Minister confirmed
the erroneous assessment and additional penalty.
d.
Issues to be Decided
11.
The issues are:
(I)
whether, the Appellant duly filed his 1999 Income Tax Return by
mail on June 14, prior to his June 15, 2000 filing date
prescribed in S. 150(1)(d) of the Income Tax Act so
that the Minister's assessment of $3,907.34 late filing
penalties is erroneous.
(ii)
whether pursuant to S. 220(3.1) of the Income Tax Act, the
Appellant should be entitled to a waiver of part or all arrears
and instalment interest and penalties paid and accruing since
1995 resulting from the 1995 assessment of receivables which were
not in fact paid in 1995 or 1996 but nonetheless were included in
his income for tax purposes.
e.
Statutory Provisions
12.
The Appellant relies on Income Tax Act of Canada Sections
12(1)(a)(b)(d)(l)(m) &
(p); 20(1)(b) & (p); 34; 34.1;
150(1)(d), 162(1), 220(3.1); 249 and such further
provisions as he or counsel may advise.
f.
Reasons
13.
The Appellant's reasons as are set out above in the Material
Facts
g.
Relief Sought
14.
The Appellant seeks affirmative answers to the above Issues to be
Decided and an order referring the assessment back to the
Minister for reconsideration and reassessment in accordance the
Court's reasons.
[17] Because
the Notice of Appeal for 1999 is drafted in the same style as the
pleading for 1998, many of my comments above will have a direct
application to the Respondent's motion for 1999. I will
consider the relief sought by the Respondent in the same order as
it is presented in the Notice of Motion.
[18] The
Respondent relies of section 53 of the G.P. Rules to
strike out paragraphs 5, 6, 7 8 and 10 of the Notice of Appeal
for 1999. The following paragraphs from the two Notices of Appeal
are virtually identical:
1998 Notice of
Appeal
1999 Notice of Appeal
Paragraph
3
same
as
Paragraph 5
Paragraph
6
same
as
Paragraph 6
Paragraph
7
same
as
Paragraph 7
I have already determined above that I will not use section 53
of the G.P. Rules to strike out paragraphs 3, 6 or 7 for
1998. For the same reasons, I will not strike out paragraphs 5, 6
or 7 for 1999.
[19] I will
not strike out paragraph 10 because it is one of the few
paragraphs which clearly identifies some of the particulars of
the 1999 assessment which is under appeal. I observed in
paragraph 6 above that the Appellant's Notice of Appeal for
1998 is rambling and imprecise. I make the same observation with
respect to his Notice of Appeal for 1999 but that does not mean
that paragraph 10 should be struck out just because the Appellant
has rambled into the territory of claiming deductions or credits
for interest and penalties resulting from an assessment of a
prior year.
[20] Paragraph
8 is relatively benign. The Appellant is an ordinary taxpayer
attempting to plead his own case. I will therefore allow him some
latitude in pleading statements which, at first blush, appear to
be not relevant but which may, in some manner, assist his cause.
In summary, I will not invoke section 53 of the G.P. Rules
to strike out any one of paragraphs 5, 6, 7, 8 or 10.
[21] The
Respondent seeks to strike out paragraphs 4, 9 and subparagraph
11(ii) pursuant to paragraph 58(3)(a) of the G.P.
Rules. Paragraph 9 and subparagraph 11(ii) in the 1999
Notice of Appeal are identical to paragraph 8 and subparagraph
10(ii), respectively, in the 1998 Notice of Appeal. For the
reasons set out in paragraphs 11 to 15 above, I will strike out
paragraph 9 and subparagraph 11(ii) in the 1999 Notice of
Appeal.
[22] Paragraph
4 in the 1999 Notice of Appeal contains a claim that the
Appellant should be allowed a credit "pursuant to S.
220(3.1) of the Income Tax Act, under which the Appellant
should be entitled to a waiver". That claim places paragraph
4 on the same footing as paragraph 9 and subparagraph 11(ii)
because the Appellant is claiming relief which this Court cannot
give. As stated in paragraph 15 above, this Court does not have
jurisdiction to compel the Minister to exercise his/her
discretion under subsection 220(3.1) in a particular way; nor
does this Court have jurisdiction to review the manner in which
the discretion was exercised. I will strike out paragraph 4 in
the 1999 Notice of Appeal.
The Appellant's Motion
[23] The
Respondent filed an affidavit by William J. Barnard in support of
each motion to strike out parts of the Notices of Appeal. The
Appellant cross-examined Mr. Barnard on his affidavit.
After the cross-examination, the Appellant brought a motion to
compel Mr. Barnard to re-attend to answer certain questions which
were objected to, refused or on which Mr. Barnard had not
adequately prepared himself. The Appellant listed approximately
20 questions in his Notice of Motion which required answers or
more complete answers; and provided a transcript of the
cross-examination.
[24] I have
some doubt as to whether the Respondent needed an affidavit in
support of its motions but, once the affidavit of Mr. Barnard was
filed, the Appellant was certainly entitled to cross-examine on
the affidavit. Some of the Appellant's questions are clearly
not relevant. For example, the first two questions are concerned
with late filing penalties assessed and reversed in 1996 and
1997, long before 1998 which is the first year under appeal. Most
of the Appellant's questions are in the nature of a demand
for particulars and do not relate to the merits of the
Respondent's motions to strike out.
[25] In
substance, I regard the Appellant's questions on
cross-examination of Mr. Barnard as not relevant to the merits of
the Respondent's motions to strike out. Those questions would
be better put to some representative of Revenue Canada on an
examination for discovery. I will dismiss the Appellant's
motion, without costs.
Other Matters
[26] I will
grant to the Respondent a period of approximately 60 days to
May 15, 2002 to file Replies to the Notices of Appeal.
[27] I
strongly recommend that the Appellant consider amending his
Notices of Appeal for 1998 and 1999. Subsection 171(1) of the
Income Tax Act describes the different ways in which this
Court may dispose of an appeal. If a taxpayer like the Appellant
commencing an appeal assumes that he will achieve at least some
success, his Notice of Appeal should describe in some detail the
way in which he wants the Minister to change the assessment under
appeal. In my view, the Notices of Appeal for 1998 and 1999 as
presently filed lack that detail.
Signed at Ottawa, Canada, this 15th day of March, 2002
"M.A. Mogan"
J.T.C.C.
COURT FILE
NO.:
2000-3643(IT)G and 2001-582(IT)G
STYLE OF
CAUSE:
James E. Adamson and
Her Majesty theQueen
PLACE OF
HEARING:
Toronto, Ontario
DATE OF
HEARING:
April 18, 2001
REASONS FOR ORDERS
BY:
The Honourable Judge M.A. Mogan
DATE OF
ORDERS:
March 15, 2002
APPEARANCES:
For the
Appellant:
The Appellant himself
Counsel for the
Respondent:
Eleanor H. Thorn
COUNSEL OF RECORD:
For the
Appellant:
Name:
N/A
Firm:
For the
Respondent:
Morris Rosenberg
Deputy Attorney General of Canada
Ottawa, Canada
2000-3643(IT)G
BETWEEN:
JAMES E. ADAMSON,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
Motions heard on April 18, 2001, at Toronto,
Ontario
the Honourable Judge M.A. Mogan
Appearances
For the
Appellant:
The Appellant himself
Counsel for the
Respondent:
Eleanor H. Thorn
ORDER
Upon
motion by the Respondent for an Order:
1. striking out paragraphs
3, 6 and 7, and subparagraph 10(i)(a) of the Notice of Appeal
pursuant to section 53 of the Tax Court of Canada Rules
(General Procedure) (the "Rules");
2. striking out paragraph
8 and subparagraph 10(ii) of the Notice of Appeal pursuant to
paragraph 58(3)(a) of the Rules;
3. granting the
Respondent, pursuant to subsection 12(1) of the Rules, an
extension of time in which to file and serve Her Reply to the
Notice of Appeal;
4. awarding costs of this
motion to the Respondent pursuant to section 147 of the
Rules; and
Court File No. 2000-3643(IT)G
5. for such further relief
as counsel may advise and this Honourable Court deems just.
And
upon reading the Notice of Appeal and the affidavit of William J.
Barnard, filed;
And
upon hearing the Appellant and counsel for the Respondent;
It is
ordered that:
1. Only subparagraph
10(i)(a) of the Notice of Appeal is struck out pursuant to
section 53 of the Rules;
2. Paragraph 8 and
subparagraph 10(ii) are struck out pursuant to
paragraph 58(3)(a) of the Rules;
3. The time within which
the Respondent may file and serve a Reply to the Amended Notice
of Appeal is extended to May 15, 2002; and
4. Costs of the
Respondent's motion are in the cause.
Upon
motion by the Appellant for an Order that William J. Barnard
re-attend to answer certain questions with respect to his
affidavit which were objected to, refused or not prepared with
adequate information;
And
upon hearing the Appellant and counsel for the Respondent;
It is
ordered that the Appellant's motion is dismissed, without
costs.
Signed at Ottawa, Canada, this 15th day of March, 2002.
J.T.C.C.
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