Citation: 2009TCC58: COR1.DOC
Date: 20090206
Docket: 2007-3262(GST)I
BETWEEN:
PIERRE-LUC VACHON,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH
TRANSLATION]
AMENDED REASONS FOR TAXATION
Alan
Ritchie, T.O., T.C.C.
[1] This matter came on for hearing
by way of a telephone conference call on Friday, December 5, 2008. It follows a
Judgment of the Honourable Justice Jorré of this Court rendered from the Bench
on July 25, 2008, allowing the appeal, with costs.
[2] The Appellant was represented by
Bernard Roy, and the Respondent by Danny Galarneau.
[3] A Bill of Costs in the amount of
$4,819.61 was submitted by the Appellant. This was reduced at the taxation by
$100 as the Registry had reimbursed the Appellant his filing fee. It was
increased by counsel for the Appellant in the amount of $75.00 for an
additional day for the presence of one of his witnesses, and an additional half
day of fees for attendance for the delivery of the judgment from the bench.
Counsel for the Respondent consented only to the fees as claimed in the
original Bill of Costs submitted – for a total of $1,995.
[4] I will deal with the issues in
dispute in the most logical manner possible.
[5] A major issue concerns the
position taken by Galarneau, Counsel for the Respondent with respect to
disbursements. The Honourable Justice Jorré, in his written reasons for
judgment dated August 15, 2008, stated the following with respect to costs:
[TRANSLATION]
Accordingly, the appeals for
assessments made pursuant to the Excise Tax Act, for which the notices
are dated April 13, 2006 bearing the numbers PQ-2006-8800 and PQ‑2006-8796
are allowed with costs, in accordance with the tariff in section 10 of the Tax
Court of Canada Rules (Informal Procedure) pursuant to the Excise Tax Act
…
Counsel for the Respondent took the
position that the Court specifically referred to section 10 of the Rules, which
only covers fees for the services of counsel. Disbursements are covered by
sections 10.1 and 10.2, and therefore should not be allowed.
[6] Technically, I would agree with
Counsel for the Respondent. Sections 10.1 and 10.2 are sections unto
themselves and not subsections of section 10. However, I cannot conceive of
any reason that the Court would intend for the Appellant to be entitled solely
to fees, and not disbursements. In the interest of equity, I take the position
that the Honourable Court unknowingly referred specifically to section 10, when
it actually intended to allow costs under sections 10, 10.1 and 10.2.
Disbursements will therefore be taxed.
[7] Counsel for the Appellant had
claimed 4 half days for the conduct of the hearing; the hearing was held over
two full days, July 21 and 22. The parties were then instructed to appear on
July 25 for the delivery of the decision from the bench. They did so, for 50
minutes beginning at 2:00 p.m. Counsel for the Appellant sought to claim an
additional half a day for “conduct of the hearing”. Counsel for the Respondent
objected, noting that the rendering of the decision does not form part of the
hearing proper.
[8] I agree with Counsel for the
Respondent. According to the Minutes of Hearing, the hearing itself concluded
on July 22, the Court reserved judgment and then convened the parties
thereafter to render its decision. I will disallow the additional half day
claimed.
[9] The Appellant claimed witness fees and travel expenses for the
appearance of the Appellant himself, as well as his father Germain Vachon. The
Respondent served the Appellant with a subpoena in order to ensure that he
produced certain documents at the hearing. The Rules at subsection
11(1) indicate that witnesses will be paid by “the party who arranged
for his or her attendance” – in this case the Respondent. Mr. Galarneau
indicated at the taxation that he had paid this witness, and I do not see where
counsel for the Appellant could be seeking reimbursement for amounts not paid
or expenses not incurred by his client. The total amount of $116.82 claimed
for the appearance of the Appellant as a witness is struck off.
[10] Regarding Germain Vachon, Counsel for the Respondent
indicated he had paid the witness fee and that the Appellant should in no way
be entitled to reimbursement for the same reasons cited above. I agree, and
the total amount claimed of $116.82 is struck off. The claim for an additional
day of witness fees is therefore moot.
[11] Two claims were made for disbursements made by the Appellant prior to
the Notice of Appeal in this matter being filed, for a total of $1,180.46.
There is no need to discuss them in detail here, as these are generally not
proper claims at taxation and are therefore struck off. Section 10.2 of the Rules
outlines proper disbursements “…essential for the conduct of the appeal…”. The
case law on this point is clear that disbursements made prior to the filing of
the Notice of Appeal are only to be allowed in exceptional circumstances, and
then only if it can be demonstrated that they were indeed essential for the
conduct of the appeal. I do not believe that is the case in this instance, and
that the disbursements were simply expenses incurred in the conduct of the
Appellant’s business.
[12] The final item at issue is an
amount of $1,310.51 in taxes owing or paid on the counsel fees for the services
charged by Mr. Roy for the conduct of the appeal before this Court on behalf of
the Appellant. As supporting documentation, an invoice from Mr. Roy to the
Appellant dated August 1, 2008, outlines fees owing in the amount of $10,062.50
and related GST in the amount of $508.94 and QST in the amount of $801.57.
[13] Counsel for the Respondent
questioned this claim. He noted that the total amount at issue in the appeal was
approximately $6,000 and for Mr. Roy to have charged his client over $10,000 is
excessive. In any event, he wanted to ensure the Appellant demonstrated that
these amounts were actually paid and that no charges were related to an almost
identical appeal by the same client that would be going forward in the Court of
Quebec.
[14] Following the Taxation hearing, I
wrote to Mr. Roy and asked him to produce an affidavit of disbursements
including relevant extracts from the billing system used by his firm regarding
Mr. Vachon’s appeal before this Court.
[15] Mr. Roy replied by way of a letter,
attaching the details of the account for his client Mr. Vachon. The charges
relating to work done for the matter before this Court were highlighted; those
relating to the matter before the provincial court were not.
[16] Perhaps in lieu of an affidavit,
which I had clearly requested of him, Mr. Roy stated in his letter that
[TRANSLATION] “…I confirm under the oath of my office that the total amount
incurred for this file, for just the work done on this file, for the Tax Court
of Canada, is ten thousand two hundred and twelve dollars and fifty cents”.
[17] Subsection 10.2(2) reads:
(2) There may be allowed all services, sales, use or
consumption taxes and other like taxes paid or payable on any counsel fees and
disbursements allowed if it is established that such taxes have been paid or
are payable and are not otherwise reimbursed or reimbursable in any manner
whatever, including, without restriction, by means of claims for input tax
credits in respect of such taxes.
[18] Although I might formulate my own
opinion regarding the amount Mr. Roy charged to his client in this matter, it
is of no consequence here. And although an affidavit was not provided as
requested, given what was produced I am on balance satisfied that the counsel
fees are payable, even if not yet paid, and therefore the related amounts for
GST and QST are as well. I will allow the amount of $1,310.51 claimed on the
Bill of Costs.
[19] The Appellant’s Revised Bill of
Costs in the amount of $4,794.61 is taxed, and $3,305.51 is allowed.
Signed
at Ottawa, Canada, this 6th day of February 2009.
"Alan Ritchie"
Translation
certified true
on this
27th day of April 2009.
Bella Lewkowicz, Translator
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