Date:
20011203
Docket:
2001-1433-EI
BETWEEN:
INTRIA
CORPORATION,
Appellant,
and
THE MINISTER OF
NATIONAL REVENUE,
Respondent,
AND
Docket:
2001-1436(EI)
CIBC FINANCIAL PLANNING
INC.,
Appellant,
and
THE MINISTER OF
NATIONAL REVENUE,
Respondent,
AND
Docket:
2001-1442(EI)
CIBC MORTGAGES
INC.,
Appellant,
and
THE MINISTER OF
NATIONAL REVENUE,
Respondent.
Reasons for
Judgment
WEISMAN,
D.J.T.C.C.
[1] These three appeals under
subsection 103(1) of the Employment Insurance Act (the
"Act") were heard together on common
evidence.
[2] The Appellants are all
wholly-owned subsidiaries of the Canadian Imperial Bank of
Commerce ("CIBC"), which is a multinational and
multi-entity corporate group. In 1999, CIBC and companies
related to it transferred 506 employees to Intria
Corporation ("Intria"), 224 employees to CIBC Financial
Planning Inc. ("CFP"), and 73 employees to CIBC
Mortgages Inc. ("CMI").
[3] Prior to the transfers, CIBC and
its related entities, duly withheld, matched, and remitted to the
Receiver General, the employee's and employer's
employment insurance premiums payable under the
Act.
[4] Following the transfers, further
premiums were withheld, matched, and remitted, but only to the
extent that each employee's maximum insurable earnings, as
received in 1999 from both their initial employers and the
Appellants were not exceeded.
[5] The Minister of National Revenue
(the "Minister") assessed each of the Appellants by
Notice of Assessment dated August 2, 2000, and August 3, 2000,
for failure to remit employment insurance premiums for the 1999
taxation year. Intria was assessed $21,022.43 (plus interest),
CFP was assessed $317,619.58 (plus interest) and CMI was assessed
$16,439.24 (plus interest).
[6] These assessments were based on
paragraph 82.(1) of the Act which provides as
follows:
82.
(l) Every employer paying remuneration to a person
they employ in insurable employment shall
(a) deduct the prescribed amount from
the remuneration as or on account of the employee's premium
payable by that insured person under section 67 for any period
for which the remuneration is paid; and
(b) remit the amount, together with the
employer's premium payable by the employer under
section 68 for that period, to the Receiver General at
the prescribed time and in the prescribed manner.
[7] The Appellants complain that this
provision required the Appellants to start all over in making
employer's employment insurance contributions in respect of
employees for whom CIBC and its related entities had already made
the maximum annual contribution for 1999. While the Act
contains mechanisms for employees to obtain refunds of premium
overpayments, the Appellants can find no comparable provision for
employers. The employer's premiums can accordingly be paid
twice.
[8] In the Appellants' view, this
additional levy upon employers is an unlegislated direct taxation
within the province and is therefore ultra-vires the
Federal Government.
[9] There are two problems with this
argument. First, the Appellants have apparently overlooked
paragraphs 96.(8.2) and 96.(9) of the Act which provide as
follows:
96.
(8.2) With respect to 1999, the Minister shall refund to
the employer the amount determined by the following formula if
that amount is more than $1:
(E2-E1) x
P1999
where
EI is the
total of all insurable earnings paid in 1998 by the employer, for
which premiums were deductible, in respect of employees who were
18 years of age or older but younger than 25 at any time during
1998;
E2 is the total
of all insurable earnings paid in 1999 by the employer, for which
premiums were deductible, in respect of employees who were 18
years of age or older but younger than 25 at any time during
1999; and
P1999 is 1.4 times the premiums rate for
1999.
...
96.
(9) If at any time during a year for which a refund is
sought two or more employers are associated, as defined by the
regulations, they shall be considered a single employer for the
purposes of subsections (6) to (8.4) and any refund shall be
allocated to them in the prescribed manner.
[10]
There was no evidence presented as to how many of the 803
transferred employees fall within the 18-25 age group.
[11]
Second, before raising this constitutional question the
Appellants failed to serve the notices required by subsection
57.(1) of the Federal Court Act which provides as
follows:
57.(1) Where the constitutional validity,
applicability or operability of an Act of Parliament or of the
legislature of any province, or of regulations thereunder, is in
question before the Court or a federal board, commission or other
tribunal, other than a service tribunal within the meaning of the
National Defence Act, the Act or regulation shall not be
adjudged to be invalid, inapplicable or inoperable unless notice
has been served on the Attorney General of Canada and the
attorney general of each province in accordance with subsection
(2).
[12]
The appeals must accordingly be dismissed and the assessments
confirmed.
Signed at Toronto,
Ontario, this 3rd day of December 2001.
D.J.T.C.C.
COURT FILE
NO.:
2001-1433(EI)
STYLE OF
CAUSE:
Intria Corporation and M.N.R.
PLACE OF
HEARING:
Toronto, Ontario
DATE OF
HEARING:
October 25, 2001
REASONS FOR JUDGMENT
BY: the Honourable Deputy Judge N.
Weisman
DATE OF
JUDGMENT:
December 3, 2001
APPEARANCES:
Counsel for the
Appellant: Alan
R. Kester
Erin K. Carley
Counsel for the
Respondent: Scott Simser
COUNSEL OF
RECORD:
For the
Appellant:
Name:
Alan R. Kester
Erin K. Carley
Firm:
Canadian Imperial Bank of Commerce
Toronto, Ontario
For the
Respondent:
Morris Rosenberg
Deputy Attorney General of Canada
Ottawa, Canada
COURT FILE
NO.:
2001-1436(EI)
STYLE OF
CAUSE:
CIBC Financial Planning Inc. and M.N.R.
PLACE OF
HEARING:
Toronto, Ontario
DATE OF
HEARING:
October 25, 2001
REASONS FOR JUDGMENT
BY: the Honourable Deputy Judge N.
Weisman
DATE OF
JUDGMENT:
December 3, 200l
APPEARANCES:
Counsel for the
Appellant: Alan
R. Kester
Erin K. Carley
Counsel for the
Respondent: Scott Simser
COUNSEL OF
RECORD:
For the
Appellant:
Name:
Alan R. Kester
Erin K. Carley
Firm:
Canadian Imperial Bank of Commerce
Toronto, Ontario
For the
Respondent:
Morris Rosenberg
Deputy Attorney General of Canada
Ottawa, Canada
COURT FILE
NO.:
2001-1442(EI)
STYLE OF
CAUSE:
CIBC Mortgages Inc. and M.N.R.
PLACE OF
HEARING:
Toronto, Ontario
DATE OF
HEARING:
October 25, 2001
REASONS FOR JUDGMENT
BY: the Honourable Deputy Judge N.
Weisman
DATE OF
JUDGMENT:
December 3, 2001
APPEARANCES:
Counsel for the
Appellant: Alan
R. Kester
Erin K. Carley
Counsel for the
Respondent: Scott Simser
COUNSEL OF
RECORD:
For the
Appellant:
Name:
Alan R. Kester
Erin K. Carley
Firm:
Canadian Imperial Bank of Commerce
Toronto, Ontario
For the
Respondent:
Morris Rosenberg
Deputy Attorney General of Canada
Ottawa, Canada
2001-1433(EI)
BETWEEN:
INTRIA
CORPORATION,
Appellant,
and
THE MINISTER OF
NATIONAL REVENUE,
Respondent.
Appeal heard on common
evidence with the appeals of Intria Corporation
(2001-1435(CPP)), CIBC Financial Planning Inc.
(2001-1436(EI) and 2001-1438(CPP)) and CIBC
Mortgages Inc. (2001-1442(EI) and
2001-1444(CPP)), on October 25, 2001 at Toronto,
Ontario, by
the Honourable Deputy
Judge N. Weisman
Appearances
Counsel for the
Appellant:
Alan R. Kester
Erin K. Carley
Counsel for the
Respondent:
Scott Simser
JUDGMENT
The appeal is
dismissed and the assessment is confirmed in accordance with the attached Reasons for
Judgment.
Signed at Toronto,
Ontario, this 3rd day of December 2001.
D.J.T.C.C.
2001-1436(EI)
BETWEEN:
CIBC FINANCIAL PLANNING
INC.,
Appellant,
and
THE MINISTER OF
NATIONAL REVENUE,
Respondent.
Appeal heard on common
evidence with the appeals of Intria Corporation
(2001-1433(EI) and 2001-1435(CPP)), CIBC Financial
Planning Inc. (2001-1438(CPP)) and CIBC Mortgages
Inc. (2001-1442(EI) and 2001-1444(CPP)), on
October 25, 2001 at Toronto, Ontario, by
the Honourable Deputy
Judge N. Weisman
Appearances
Counsel for the
Appellant:
Alan R. Kester
Erin K. Carley
Counsel for the
Respondent:
Scott Simser
JUDGMENT
The appeal is
dismissed and the assessment is confirmed in accordance with the attached Reasons for
Judgment.
Signed at Toronto,
Ontario, this 3rd day of December 2001.
D.J.T.C.C.
2001-1442(EI)
BETWEEN:
CIBC MORTGAGES
INC.,
Appellant,
and
THE MINISTER OF
NATIONAL REVENUE,
Respondent.
Appeal heard on common
evidence with the appeals of Intria Corporation
(2001-1433(EI) and 2001-1435(CPP)), CIBC Financial
Planning Inc. (2001-1436(EI) and 2001-1438(CPP))
and CIBC Mortgages Inc. (2001-1444(CPP)), on
October 25, 2001 at Toronto, Ontario, by
the Honourable Deputy
Judge N. Weisman
Appearances
Counsel for the
Appellant:
Alan R. Kester
Erin K. Carley
Counsel for the
Respondent:
Scott Simser
JUDGMENT
The appeal is
dismissed and the assessment is confirmed in accordance with the attached Reasons for
Judgment.
Signed at Toronto,
Ontario, this 3rd day of December 2001.
D.J.T.C.C.
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