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Citation: 2004TCC198
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Date : 20040304
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Docket: 2003-3213(IT)APP
2003-3214(IT)APP
2003-3212(IT)APP
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BETWEEN:
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SYLVIE DESCHAMPS,
GUY DESCHAMPS,
RICHARD DESCHAMPS,
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Applicants,
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and
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HER MAJESTY THE QUEEN,
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Respondent.
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[OFFICIAL ENGLISH
TRANSLATION]
REASONS FOR ORDER
Lamarre
Proulx J.
[1] These
applications were heard on common evidence and are applications to extend the
time limit in which the Applicants can appeal to the Tax Court of Canada under
section 167 of the Income Tax Act (the “Act”).
[2] The
reassessments are dated November 14, 1995, for the 1992 and 1993
taxation years in Guy Deschamps’ case. For Sylvie Deschamps, the
reassessments are dated November 6, 1995, for the 1992 and 1993 taxation years.
For Richard Deschamps, the reassessments are dated February 26, 1996,
for the 1991, 1992 and 1993 taxation years.
[3] The
confirmations are dated August 20, 2002. It is agreed that if the
taxpayers were legitimately informed in writing of the decision of the Minister
of National Revenue (the “Minister”), the time allowed for an appeal to this
Court under section 169 of the Act expired on November 18, 2002. The time limit
for appeals is 90 days from the day notice has been mailed to the taxpayer
that the Minister has confirmed the assessment.
[4] The
applications for an extension of time under section 167 of the Act are dated
September 8, 2003.
[5] Richard Deschamps
was the only Applicant to testify. First, he said that the notices of objection
were filed within the prescribed time limit. Then, he explained that after
receiving a request for payment, he consulted his lawyer. This request was
produced as Exhibit R-2 it is dated July 9, 2003, is from Revenu Québec and the
subject heading indicates that it is a final notice.
[6] The
Applicant’s testimony was brief and affirmed that he and the other Applicants
believed that they were still waiting for Revenue Canada’s decision. Based on Exhibit R-1, the cases were put on hold in 1996 by
Revenue Canada pending this Court’s decision in a
similar case. The taxpayers accepted this hold placed on their objection.
According to the Applicant, they allegedly did not receive the confirmation
notices.
[7] Suzanne Lepage,
an appeals officer, testified. She produced letters from March 19, 2002, as
Exhibit I-3, which were addressed to the Applicants’ counsel and to the
Applicant, Guy Deschamps. These letters included a proposed agreement between
the taxpayers and the federal tax authorities to settle the appeals that had
been put on hold.
[8] She
contacted the parties on several occasions. On July 23, 2002,
Mr. Charpentier, the Applicants’ counsel, told her that he recommended
that the clients sign. As she still had not received anything by August 7,
2002, she again contacted counsel and the taxpayers to find out what was going
on. She was told that the taxpayers had changed their minds and refused the
agreement.
[9] It
was following this negative information that she sent the confirmation notices
of the reassessments with an explanatory letter by registered mail on August
20, 2002. These documents were filed as Exhibit I-1. Exhibit I-2 is the
confirmation of the delivery of these documents by registered mail and of their
receipt. Exhibit I-1 also shows that there was a delivery by regular mail of at
least one of these documents to the Applicants’ counsel.
[10] Exhibit I‑4 consists of computer printouts with the taxpayers’
addresses. The three taxpayers live in the same city, each at different street
addresses, which have remained the same for the past 10 years.
[11] The Respondent’s agent pointed out that the Applicants did not show
any indication that they acted as soon as circumstances permitted as stipulated
in subsection 167(5) of the Act. She also pointed out that all that is
stipulated in the Act is to inform the taxpayer in writing. Evidence of receipt
is not required.
[12] She referred to the Federal Court of Appeal decision in Canada
(Attorney General) v. Bowen (C.A.), [1992] 1 F.C. 311, and more specifically paragraph 7 of this
decision:
7. In our opinion, the duty resting upon the
Minister under subsection 165(3) was to do precisely what he did, viz., notify
the respondent of the confirmation by registered mail. Nothing in that
subsection or in section 169 required the notification to be “served”
personally or to be received by the taxpayer. In dispatching the notification
by registered mail the Minister was entitled to avail himself of the address or
addresses which the respondent himself had already furnished. There was no obligation
on him to look beyond that information. Moreover, a requirement for the receipt
of the notification would be difficult if not totally unworkable from an
administrative standpoint. Parliament has not required it; it has required
merely that the notification be dispatched by registered mail.
[13] The Applicants’ counsel pointed out that neither they nor he received
the confirmation notice.
Analysis and conclusion
[14] The Federal Court of Appeal decision was rendered concerning the
previous version of subsection 165(3) of the Act. This subsection was amended
on June 10, 1993, and read as follows:
165(3) Duties of the
Minister — On receipt of a notice of objection under this section, the
Minister shall,
(a) with all due
dispatch, reconsider the assessment and vacate, confirm or vary the assessment
or reassess
or
(b) where the
taxpayer indicates in the notice of objection that the taxpayer wishes to
appeal immediately to the Tax Court of Canada and waives reconsideration of the
assessment and the Minister consents, file a copy of the notice of objection
with the Registrar of that Court,
and the Minister shall
thereupon notify the taxpayer by registered mail of the action taken.
[15] Subsection 165(3) of the Act now reads as follows:
165(3) Duties of
Minister — On receipt of a notice of objection under this section, the
Minister shall, with all due dispatch, reconsider the assessment and vacate,
confirm or vary the assessment or reassess, and shall thereupon notify the
taxpayer in writing of the Minister’s action.
[16] Upon reading these provisions, it is clear that the amendment did not
change the principles set out by the Federal Court of Appeal in Bowen (supra).
[17] Subsections 169(1), 167(1), 167(5) and 244(14) of the Act read as
follows:
167(1) Extension of
time to appeal — Where an appeal to the Tax Court of Canada has not been instituted
by a taxpayer under section 169 within the time limited by that section for
doing so, the taxpayer may make an application to the Court for an order extending
the time within which the appeal may be instituted and the Court may make an
order extending the time for appealing and may impose such terms as it deems
just.
167(5) When order to
be made — No
order shall be made under this section unless:
(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,
(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.
169(1) Appeal — Where a taxpayer has served
notice of objection to an assessment under section 165, the taxpayer may appeal
to the Tax Court of Canada to have the assessment vacated or varied after
either:
(a) the Minister has confirmed the
assessment or reassessed, or;
(b) 90 days have elapsed after
service of the notice of objection and the Minister has not notified the
taxpayer that the Minister has vacated or confirmed the assessment or
reassessed,
but no appeal under this section may be
instituted after the expiration of 90 days from the day notice has been mailed
to the taxpayer under section 165 that the Minister has confirmed the
assessment or reassessed.
244(14) Mailing date
— For the purposes
of this Act, where any notice or notification described in subsection
149.1(6.3), 152(3.1), 165(3) or 166.1(5) or any notice of assessment or
determination is mailed, it shall be presumed to be mailed on the date of that
notice or notification.
[18] I believe that the evidence revealed that the confirmation notices
were sent in writing on August 20, 2002, by registered mail as reported in
Exhibit I-2.
[19] Exhibit I-2 also shows that the documents were received. In any case,
it is not very plausible that three notices sent to different addresses where
the addressees have been residing for a long time were not received. It is also
strange that the Applicants only responded after receiving the final notice
requesting payment.
[20] When taxpayers can clearly demonstrate that they have not received
mail items because they have moved or if for some reason they were not residing
at their address, these facts can help show that within the prescribed time,
these taxpayers were unable to act or have someone else act on their behalf, as
stipulated in subsection 167(5) of the Act.
[21] In this case, there was no change of address and no evidence that the
Applicants had been absent from their homes for long periods of time when the
confirmation notices were sent. The only evidence from the Applicants was that
they did not receive the confirmation notices.
[22] On a balance of evidence, it is impossible for me to believe this
version of the facts.
[23] Consequently, the applications must be dismissed.
Signed at Ottawa, Canada this
4th day of March 2004.
Lamarre
Proulx J.
on this 23rd day of December 2004 .
Julie Oliveira, Translator
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