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Docket: 2001-2324(IT)G
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BETWEEN:
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ALLAN ORCHESON,
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Appellant,
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and
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HER MAJESTY THE QUEEN,
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Respondent.
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____________________________________________________________________
Motion heard on common evidence with the motion of
Lorna Orcheson, 2001-2325(IT)G, on February 25,
2003, at Toronto, Ontario,
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Before: The Honourable Judge C.H. McArthur
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Appearances:
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For the Appellant:
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The Appellant himself
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Counsel for the Respondent:
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Franco Calabrese
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____________________________________________________________________
ORDER
Upon
motion by the Appellant for an Order permitting oral examination
for discovery of D.W. Browne, an auditor with Canada Customs and
Revenue Agency and for written examination for discovery of Alice
Shields, Director of the Toronto Centre Tax Services Office of
CCRA;
And
upon reading the pleadings, the Appellant's material in support
of the motion, and the Respondent's written submissions;
And
upon hearing the Appellant and counsel for the Respondent;
It is
ordered that the motion is dismissed with one set of costs to the
Respondent fixed at $200.
Signed at Ottawa, Canada, this 14th day of April, 2003.
J.T.C.C.
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Docket: 2001-2325(IT)G
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BETWEEN:
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LORNA ORCHESON,
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Appellant,
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and
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HER MAJESTY THE QUEEN,
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Respondent.
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____________________________________________________________________
Motion heard on common evidence with the motion of
Allan Orcheson, 2001-2324(IT)G, on February 25,
2003, at Toronto, Ontario,
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Before: The Honourable Judge C.H. McArthur
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Appearances:
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For the Appellant:
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The Appellant herself
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Counsel for the Respondent:
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Franco Calabrese
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____________________________________________________________________
ORDER
Upon
motion by the Appellant for an Order permitting oral examination
for discovery of D.W. Browne, an auditor with Canada Customs and
Revenue Agency and for written examination for discovery of Alice
Shields, Director of the Toronto Centre Tax Services Office of
CCRA;
And
upon reading the pleadings, the Appellant's material in support
of the motion, and the Respondent's written submissions;
And
upon hearing the Appellant and counsel for the Respondent;
It is
ordered that the motion is dismissed with one set of costs to the
Respondent fixed at $200.
Signed at Ottawa, Canada, this 14th day of April, 2003.
J.T.C.C.
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Citation: 2003TCC269
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Date: 20030414
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Docket: 2001-2324(IT)G
2001-2325(IT)G
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BETWEEN:
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ALLAN ORCHESON
and LORNA ORCHESON,
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Appellants,
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And
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HER MAJESTY THE QUEEN,
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Respondent.
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REASONS FOR ORDER
McArthur J.
[1] The Appellants' motions request an
Order permitting the oral examination for discovery of D.W.
Browne, an auditor with Canada Customs and Revenue Agency and
written examinations for discovery of Alice Shields, Director of
the Toronto Centre Tax Services Office of CCRA. The Appellants'
position is best set out in the affidavit of Allan Orcheson which
includes the following:
For a full and fair disclosure, the oral examination for
discovery can best be conducted with D.W. Browne, the auditor. He
knows the reasons he used in disallowing my legitimate business
expenses. His work gave rise to the Notices of Reassessment and
my Amended Notice of Appeal. It would cause significantly
prejudice if we could not examine D. Browne or a knowledgeable
alternative who is familiar with this case. ...
The auditor's perception of the scope of my business operations
which included the property at 311 Lake Drive North, a viewpoint
he expressed in writing and held prior to his commencement of
this most recent audit, that perception is inconsistent with his
current exclusion of this property. Furthermore, his audit
findings are in conflict with relevant and related assessments
issued by CCRA for taxation years both prior and after his audit
period. He or the aforementioned alternative should be held
accountable in an oral examination for an apparent arbitrary
treatment of my business operations. ...
An oral examination of D. Browne would provide a more full and
fair disclosure. The auditor's written work is unreliable in our
view. He issued an audit report stating that he would reassess
within 30 days of the date of his letter. He did not proceed with
his adjustments as he stated. I had to obtain compliance
elsewhere. As we are unable to confirm D. Browne's current
employment with CCRA, a knowledgeable alternative may be able to
provide verbal clarification as to the reasons for the delay in
reassessing our file by CCRA. ...
[2] Subsections 17.3(1), (2) and (3)
of the Tax Court of Canada Act provide:
17.3(1)
Where the aggregate of all amounts in issue in an appeal under
the Income Tax Act is $25,000 or less, or where the amount
of the loss that is determined under subsection 152(1.1) of that
Act and that is in issue is $50,000 or less, an oral
examination for discovery shall not be held unless the parties
consent thereto or unless one of the parties applies therefor and
the Court is of the opinion that the case could not properly be
conducted without that examination for discovery.
17.3(2)
In considering an application under subsection (1), the Court may
consider the extent to which the appeal is likely to affect any
other appeal of the party who instituted the appeal or relates to
an issue that is common to a group or class of persons.
17.3(3)
The Court shall order an oral examination for discovery in an
appeal referred to in subsection (1), on the request of one of
the parties, where the party making the request agrees to submit
to an oral examination for discovery by the other party and to
pay the costs in respect of that examination for discovery of
that other party in accordance with the tariff of costs set out
in the rules of Court.
[3] The Respondent's position is set
out in the written submissions submitted and includes:
(i) pursuant
to the Tax Court of Canada Act (the "TCCA"), the
appellants are not entitled to conduct oral examinations for
discovery, and leave for oral examinations for discoveries should
not be granted in these appeals;
(ii) pursuant to the
Tax Court of Canada Rules (General Procedure) (the
"General Procedure Rules"), the Deputy Attorney General is
entitled to nominate the representative to be examined on behalf
of the Respondent and the appellants are not entitled, at this
time, to an order permitting them to examine particular
representatives on behalf of the Respondent; and
(iii) pursuant to the
General Procedure Rules, each Appellant is only entitled
to conduct only one examination for discovery of the Respondent
and leave to conduct second examinations for discovery should
only be granted, if at all, after the first examinations for
discovery have been completed and only in appropriate cases.
[4] The Appellants are not interested
in an Order pursuant to subsection 17.3(3) of the Tax
Court of Canada Act whereby they would be required to pay the
costs of the examination for discovery.
[5] There is no question that the
aggregate of all amounts in issue is under $25,000 and the amount
of loss is less than $50,000 as provided for in
subsection 17.3(1). In fact, the amounts under appeal in
each year come within the informal procedure limits. The amount
of tax in dispute in each year is as follows:[1]
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Taxation Year
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Federal Tax in Dispute
Lorna Orcheson
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Federal Tax in Dispute
Allan Orcheson
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1995
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$825.42
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1996
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$741.35
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$1,327.40
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1997
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$2,972.71
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$2,642.58
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1998
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$5,031.19
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$2,846.45
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1999
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$2,912.14
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$7,936.35
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[6] The appeals concern the taxation
years 1995, 1996, 1997, 1998 and 1999. The issue is whether the
Appellants are entitled to deduct expenses for rental cottages
owned jointly by them in excess of those expenses allowed by the
Minister of National Revenue.
[7] Subsection 17.3(1) provides that
an oral examination for discovery shall not be held unless the
Court is of the opinion that the cases could not be properly
conducted without oral examinations. From a reading of the
pleadings, the facts are not complex and the Respondent's
position appears to be clearly set out in the Replies to the
Notices of Appeal. The Respondent is prepared to permit a written
examination of Alice Shields.
[8] The Appellants have not satisfied
me that their appeals could not be properly conducted without the
oral examination of D.W. Browne.
[9] Subsection 93(3) of the Tax
Court of Canada Rules (General Procedure) provides that the
Crown shall select a knowledgeable officer to be examined. Only
after that party has been examined may the Court provide for the
examination of another person.[2]
[10] The Appellants are premature because
the written examinations for discovery of Alice Shields have not
been conducted and they have no basis to conclude, at this time,
that Alice Shields is not knowledgeable. At this stage, there is
insufficient evidence to conclude that the cases could not be
properly conducted with the oral examination of Alice
Shields.
[11] The motions are dismissed with one set
of costs to the Respondent fixed at $200.
Signed at Ottawa, Canada, this 14th day of April, 2003.
J.T.C.C.
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