Docket: 2009-600(IT)G
2009-601(GST)G
BETWEEN:
KANNIAPPA (KEN) REDDY,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
____________________________________________________________________
Motion
heard on November 17, 2010, at Vancouver, British Columbia
By: The Honourable
Justice E.A. Bowie
Appearances:
|
Counsel for the Appellant:
|
Timothy
W. Clarke
|
|
|
|
|
Counsel for the Respondent:
|
Bruce Senkpiel
|
____________________________________________________________________
ORDER
UPON motion by the Appellant for an Order
compelling the Respondent’s witness on discovery, Annie Siu, the Canada Revenue
Agency appeals officer that considered the Appellant’s income tax and GST
objections and confirmed the assessments, to answer questions 208, 211, 247 and
257 from the transcript of her discovery (attached to the affidavit of Riley
Burr dated November 10, as Exhibit E), to which counsel objected, and for
costs of this motion, in any event of the cause;
AND UPON
reading the materials filed;
AND UPON
hearing counsel for the parties;
IT IS
ORDERED THAT:
1. The
motion is dismissed.
2. The Appellant shall
pay to the Respondent costs of the motion forthwith, and in any event op the cause
which costs are fixed at $550, inclusive of disbursements and H.S.T. to be paid
within 30 days of the date of this Order.
Signed at Ottawa, Canada,
this 11th day of March, 2011.
“E.A. Bowie”
Citation: 2011 TCC 161
Date: 20110311
Docket: 2009-600(IT)G
2009-601(GST)G
BETWEEN:
KANNIAPPA (KEN) REDDY,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR ORDER
Bowie
J.
[1] The appellant brings
this motion seeking an order requiring that the respondent’s nominee to be examined
for discovery under Rule 93 answer the following questions:
208 Can you point to
the documents that have been produced by counsel that demonstrate what your
assumptions of fact are?
211 Okay. Can you
read through the T401 Report and point to me – tell me which are your
assumptions of fact in that R401 Report?
247 Okay. Once again,
the exhibit – tab 57 of the Respondent’s book, Volume 1, contains the T401
Report.
My question for the witness
is to, please, go through the T401 Report and identify for me the assumptions –
all of the assumption that are set out in the T401 Report that she made in
confirming the assessment?
257 Yes. Can you
point to the assumptions of fact that you made in confirming the GST
reassessment in this T401?
[2] This is the context
in which the dispute arises. The appellant has been reassessed for the taxation
years 2000, 2002 and 2003 to include approximately $357,000 to his income for
those years, and for associated interest and penalties. He was also assessed
under the Excise Tax Act, Part IX, for approximately $32,000 in unpaid
goods and services tax together with interest and penalties in respect of the
same three years. The assessments were confirmed following the Appellant’s
objections, and he has appealed. The income tax and goods and services tax
appeals have been consolidated, and on April 29, 2010 counsel for the Appellant
examined Annie Siu, the Deputy Attorney General’s nominee, in respect of the income
tax and the GST appeals. Ms. Siu is the appeals officer of the Canada Revenue Agency
who considered the assessments following the objections, and confirmed them
all.
[3] Paragraph 7 of the
Reply to the Notice of Appeal delivered by the respondent in the income tax
appeals recites 7 assumption of fact said to have been made by the Minister of
National Revenue in the course of determining the appellant’s liability for
tax. Paragraph 8 of the GST Reply pleads 33 assumptions some, but not all, of
which are duplicative of those pleaded in the income tax appeals. A few of
these assumptions appear to offend the rule in Canada v. Anchor Point Energy
Limited
in that they involve mixed statements of fact and law, but that is not in issue
here.
[4] The question in
this motion comes down to whether the questions, as formulated, are fair. The respondent
does not dispute that the appellant is entitled to question the witness as to
whether each of the assumptions pleaded was actually made by a representative of
the Minister in the course of either assessing or confirming those assessments.
If the appellant can establish in respect of any of them that they were not,
then he is relieved of the burden of disproving those. During the discussion
between counsel that is part of the record, counsel for the respondent offered
by way of undertaking to provide a written response to the questions as framed
by counsel for the appellant. This offer was refused. Counsel for the appellant
insisted that he was entitled to have the witness go through the documents to
identify each assumption of fact and where they were recorded, either in the
reports on objection, or elsewhere in the documents produced.
[5] Rules 95(1),
107 and 108 are directed to the conduct of an examination for discovery:
95(1) A person examined for
discovery shall answer, to the best of that person’s knowledge, information and
belief, any proper question relevant to any matter in issue in the proceeding
or to any matter made discoverable by subsection (3) and no question may be
objected to on the ground that
(a) the
information sought is evidence or hearsay,
(b)
the question constitutes cross-examination, unless the question is
directed solely to the credibility of the witness, or
(c) the question constitutes
cross-examination on the affidavit of documents of the party being examined.
107(1) Where a question is objected to, the objector shall state
briefly the reason for the objection, and the question and the brief statement
shall be recorded.
(2) A question that is objected to may be answered
with the objector's consent, and where the question is answered, a ruling shall
be obtained from the Court before the evidence is used at a hearing.
(3) A ruling on the propriety of a question that is
objected to and not answered may be obtained on motion to the Court.
108(1) An examination may be
adjourned by the person being examined or by a party present or represented at
the examination, for the purpose of moving for directions with respect to the
continuation of the examination or for an order terminating the examination or
limiting its scope, where,
(a)
the right to examine is being abused by an excess of improper questions
or interfered with by an excess of improper interruptions or objections,
(b)
the examination is being conducted in bad faith, or in an unreasonable
manner so as to annoy, embarrass or oppress the person being examined,
(c)
many of the answers to the questions are evasive, unresponsive or unduly
lengthy, or
(d) there has been a neglect or
improper refusal to produce a relevant document on the examination.
(2) Where the Court
finds that,
(a)
a person's improper conduct necessitated a motion under subsection (1),
or
(b)
a person improperly adjourned an examination
under subsection (1),
the Court may direct the person to pay personally and forthwith the
costs of the motion, any costs thrown away and the costs of any continuation of
the examination and the Court may fix the costs and give such other direction
as is just.
[6] In the present case,
it is the form of the question that is objectionable. Counsel is, of course, entitled
to examine the deponent as to each assumption of fact that has been pleaded. However,
it is counsel’s job, not the deponent’s, to go through the document to
ascertain whether the assumptions are to be found recorded there. The examination
is not a memory test for the deponent to pass or fail depending on how well she
has memorized the 37 assumptions that are pleaded.
[7] Compound questions
are not permitted,
because they are unfair to the person being examined. Here counsel is trying to
require the examinee to deal with 37, and in the GST cases, 33 questions rolled
into one. He is, of course, free to ask about each assumption pleaded whether
it was in fact made, and by whom, and if it was recorded in a document at the
time, and if so where; but that is four questions concerning each of the many
assumptions, and they must be asked seriatim, not in the form of one
compound question.
[8] As the examination
had not been completed when the present motion was brought, re-attendance is
not an issue. Counsel may put the questions, in proper form, at the
continuation.
[9] The one matter upon
which counsel were agreed on the hearing of the motion was costs. They each
argued that they should have costs of the motion forthwith in any event of the cause.
In my view, that is the proper costs order upon resolution of most interlocutory
disputes, unless special circumstances dictate otherwise. The motion is
therefore dismissed, with costs, which I fix at $550 to be paid by the appellant
within 30 days of the date of this Order.
[10] Before leaving this
matter, I feel bound to make the further observation that the protracted
arguments that took place during the examination in this case were totally
inappropriate. Counsel who finds a question objectionable under the Rules
“… shall state briefly the reason for the objection …”. If both counsel agree to have a
discussion of the objection off the record then they are free to do so;
otherwise, examining counsel should simply move on to the next question. In the
present case, counsel for the respondent, in an ill-advised attempt to be
helpful, repeatedly suggested alternative ways to avoid the impasse, even
offering an undertaking to have the deponent furnish the answer to the compound
question in writing at a later date. This quickly led to ill-tempered bickering
which served no useful purpose and was quite beyond the pale. It is this kind
of conduct that undermines the civility that ought to be a hallmark of
relations among members of the bar.
Signed at Ottawa, Canada, this 11th day of March, 2011.
“E.A. Bowie”
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