Citation: 2007TCC156
Date: 20070321
Docket: 2006-3390(IT)APP
BETWEEN:
BERTRAND JOYAL,
Applicant,
and
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR ORDER
Angers J.
[1] This is an
application by the Applicant for an order extending the time within which an
appeal may be instituted to the Tax Court of Canada from the reassessments
dated March 17, 2006, for the 1998, 1999, 2000, 2001 and 2002 taxation
years, under section 167 of the Income Tax Act (the “Act”). To make an order extending the time for appealing, it is necessary,
according to subsection 167(5), that the following conditions be met:
167(5) . . .
(a) the
application is made within one year after the expiration of the time limited by
section 169 for appealing; and
(b) the taxpayer demonstrates that
(i) within the
time otherwise limited by section 169 for appealing the taxpayer
(A) was unable
to act or to instruct another to act in the taxpayer’s name, or
(B) had a bona
fide intention to appeal,
(ii) given the
reasons set out in the application and the circumstances of the case, it would
be just and equitable to grant the application,
(iii) the
application was made as soon as circumstances permitted, and
(iv) there are reasonable
grounds for the appeal.
[2] The Applicant duly
objected to the reassessments on May
11, 2004, and, by letter sent by registered mail dated January
4, 2006, the Minister of National
Revenue (the “Minister”) advised the Applicant that he had confirmed the
reassessments of March 17, 2004. The letter informed the Applicant of his right
to appeal to the Court and included the document explaining how to proceed.
That same day, the Minister also wrote to the Applicant’s legal representative,
Gilles Doré, informing him of the same facts and also attached the copy of
the document containing the information on how to appeal to the Court.
[3] The Applicant did
not testify at the hearing. An affidavit by Mr. Doré was filed explaining
the circumstances surrounding the failure to institute an appeal within the
prescribed time limit, which ended on April 4, 2006.
[4] According to the
affidavit, the Applicant was contacted by a collection officer about his unpaid
taxes on November 15, 2006. He informed the officer that he had appealed the
assessment and contacted Mr. Doré to make sure that everything was in
order, which was not the case. The appropriate steps were taken and
accordingly, the instant application was filed two days later, on
November 17, 2006.
[5] The other facts
revealed by the affidavit are as follows:
1. The Applicant, who works in the agricultural
field, always entrusted the task of filing his annual returns to
professionals.
2. On
March 21, 2001, the Applicant was arrested following a police operation.
3. On
the occasion of said police operation, numerous searches and seizures were
conducted and countless goods and documents were seized or dealt with.
4. On
October 12, 2001, the Applicant pled guilty and was sentenced to six years in
prison.
5. During
his detention, he was served with many notices of assessment.
6. The
Applicant retained the services of Mr. Doré, who agreed to represent him.
7. Mr. Doré
therefore contacted or attempted to contact all those who acted in the cases
during the relevant years. Three cases (Goods and Services Tax, Québec Sales
Tax and provincial income tax) are on appeal.
8. With
respect to the instant case, it was plagued with the pussyfooting between
various stakeholders more or less certain of their determination to act in
these cases and, as a result, related documents were now misplaced, now found,
now sent in whole and now sent in part.
9. What
is more, there was a misunderstanding between the stakeholders as to the person
authorized by the warrant.
10. Mr. Doré
did not manage to clarify the situation and take the appropriate measures in a
timely manner, which explains the need for the instant application.
11. The
Applicant stated that it was always his intention to appeal.
[6] Revenue Canada
appeals officer Francine Thériault testified that she received the Applicant’s
file in June 2005 during the objection period. The file included a fax
from Mr. Doré stating that he was the representative for the Applicant and
a note saying that Sophie Doré, Mr. Doré’s assistant, would transmit
the grounds of the objection as soon as an officer telephoned her.
[7] On July 6, 2005,
Ms. Thériault asked Mr. Doré for a signed authorization from the
Applicant certifying that he was his representative, as the notice of objection
identified the Applicant’s accountant as his representative. She also asked him
to provide her with submissions on the objection. After a few telephone
exchanges during that month, a letter was sent by priority post to
Mr. Doré still requesting the signed authorization from the taxpayer and
the grounds for the objection. A second request was sent by priority post in
September 2005 and, following a telephone call, Mr. Doré informed
Ms. Thériault that the information would be sent to her within a week.
Seeing as the Applicant was in prison, additional extensions were granted by
Ms. Thériault as he was to be released in October. Mr. Doré was granted an
additional extension until December 15, 2005, after which the file would be
closed. On December 20, 2005, the file was closed; notices of confirmation were
therefore sent on January 4, 2006, to the Applicant and Mr. Doré as
mentioned above.
[8] On June 8, 2006,
Sophie Doré left a message for Ms. Thériault asking her to telephone
her back. The telephone number she left was that of Mr. Doré. Seeing as
Ms. Thériault was away from the office, she returned the telephone call
on August 15, 2006, and explained to her that the file had been closed
since December 2005 and that she had 90 days to institute an appeal
to the Court. Sophie Doré stated at the time that she did not file an appeal
with the Court before April because she did not have the file. A message was
left for Ms. Thériault on November 16, 2006, by Sophie Doré
requesting a copy of the memorandum on the Applicant’s objection and that
document was faxed on November 21, 2006.
[9] Did the Applicant
succeed in meeting the conditions set out in subsection 167(5) of the Act?
The affidavit of Mr. Doré convinces me that the Applicant had a bona fide
intention to appeal, as Mr. Doré admits having been instructed by the
Applicant to do so and I have no reason to doubt the veracity of that
instruction. As for the condition in paragraph 167(5)(B)(iv), it was not
raised in the Respondent’s objection to the instant application. The issue is
therefore whether it would be
just and equitable to make such an order and whether the application was made as soon as circumstances permitted within the meaning of
paragraphs 167(5)(B)(ii) and (iii) of the Act.
[10] In the case at bar,
the notices of confirmation dated January 4, 2006, were sent to the Applicant
and Mr. Doré accompanied by the information on the appeal process, and
particularly the 90 day time limit from the day the Minister’s decision has
been mailed. On two occasions, the name of Sophie Doré appears in the
handwritten notes of Ms. Thériault and in one place, it is indicated that
she would act as an assistant. In the telephone conversation of August 15,
2006, she mentioned that she did not file an appeal with the Court before April
(date of the expiration of the 90 day time limit) because she did not have the
file. It was not until November, three months later, that she telephoned
Ms. Thériault back and asked her for a copy of the memorandum on the
objection after the Applicant was paid a visit by Canada Revenue Agency
collection officers.
[11] The onus is
therefore on the taxpayer (the Applicant ) to prove, on balance of
probabilities, that his application was made as soon as circumstances
permitted. He must also be aware of the delay in instituting an appeal. In the
case at bar, he entrusted this responsibility to his lawyer and according to
the evidence, he was or should have been aware of the delay when
Sophie Doré acknowledged that delay during her conversation with
Ms. Thériault. In my opinion, there was, as of that moment, an obligation,
on the one hand, to inform the Applicant and, on the other, to make an
application for an extension of time. According to the evidence, the
application was not made until mid-November 2006. No evidence was adduced to
explain the interval between August 15, 2001, and the instant application.
[12] In view of these
circumstances, I cannot grant the application. It is therefore dismissed.
Signed at Ottawa, Canada, this 21st day of March 2007.
“François Angers”
Translation certified true
on this 5th day of July 2007.
Daniela Possamai,
Translator
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