Shaw Communications v. M.N.R., docket 2000-1446-EI

Date: 20010717

Dockets: 2000-1446-EI,

2000-1448-CPP

BETWEEN:

SHAW COMMUNICATIONS INC.,

Appellant,

and

THE MINISTER OF NATIONAL REVENUE,

Respondent,

and

PATRICK PLUMMER,

Intervenor.

Reasonsfor Order

Mogan J.

[1]            The Appellant carries on the business of providing cable television programming and services, digital audio services, internet services and content to households and businesses in various regions throughout Canada. The Appellant entered into contracts with certain individuals (the "workers") to install and repair the services provided by the Appellant.

[2]            In a ruling by the Respondent dated November 15, 1999, it was determined that (i) the workers' employment was pensionable under paragraph 6(1)(a) of the Canada Pension Plan and (ii) the workers' employment was insurable under paragraph 5(1)(a) of the Employment Insurance Act on the basis that the workers were employees under contracts of service and not independent contractors for the period of January 1, 1998 to November 2, 1998.

[3]            The Appellant filed a Notice of Appeal with the Court on February 11, 2000 from this ruling. The Respondent filed a Reply to the Notice of Appeal on May 29, 2000. At issue in the appeal is whether the workers in question provided services to the Appellant pursuant to a contract of service (as employees) or provided services pursuant to a contract for service (as independent contractors) for the period of January 1, 1998 to November 2, 1998. In substance, this is a dispute over whether the Workers were employees of the Appellant or independent contractors. The hearing of the appeal is scheduled for Calgary on September 24, 2001 for a period of four days.

[4]            By Notice of Motion dated June 28, 2001, the Respondent seeks leave to amend the Reply to the Notice of Appeal to withdraw certain admissions and to make certain statements. For the reasons set out below, I have concluded that the Respondent should be permitted to amend the Reply. This Court has rules of procedure for appeals respecting the Canada Pension Plan andthe Employment Insurance Act. There is nothing in those rules with respect to the amendment of pleadings or the withdrawal of admissions. Therefore, I refer to sections 54, and 132 of the Tax Court of Canada Rules (General Procedure):

               

54             A pleading may be amended by the party filing it, at any time before the close of pleadings, and thereafter either on filing the consent of all other parties, or with leave of the Court, and the Court in granting leave may impose such terms as are just.

132           A party may withdraw an admission made in response to a request to admit, a deemed admission or an admission in the party's pleading on consent or with leave of the Court.

[5]            These provisions give the Court a broad discretion to permit the amendment of pleadings and the withdrawal of admissions. The general rule with respect to such amendments is stated by the Federal Court of Appeal in The Queen v. Canderel Limited, 93 DTC 5357 at page 5360:

... the general rule is that an amendment should be allowed at any stage of an action for the purpose of determining the real questions in controversy between the parties, provided, notably, that the allowance would not result in an injustice to the other party not capable of being compensated by an award of costs and that it would serve the interests of justice.

When a party seeks to amend its pleading, the most important consideration is that other parties not be prejudiced. Counsel for the Appellant, in his Factum, set out a number of criteria to consider in determining whether amendments to pleadings should be permitted. He did not, however, describe any manner in which the Appellant would be prejudiced if the amendments sought by the Respondent were to be permitted. The question is whether it is more consistent with the interests of justice that the withdrawal be permitted or that it be denied. As stated by Judge Bowman in Continental Bank Leasing Corporation et al v. The Queen, 93 DTC 298 at 302 (also quoted by the Federal Court of Appeal in Canderel):

... No single factor predominates nor is its presence or absence necessarily determinative. All must be assigned their proper weight in the context of the particular case. Ultimately it boils down to a consideration of simple fairness, common sense and the interest that the courts have that justice be done.

[6]            The Appellant argued that counsel for the Respondent should not be permitted to amend his Reply because he had provided no evidence as to why the amendments are sought or admissions withdrawn. During the hearing of this motion, counsel for the Respondent stated that the Minister's officer, who had made the decision under appeal and who will be the nominee for discovery, was seriously ill and only recently returned to full time employment, enabling counsel for the Respondent to begin preparing for discovery. Counsel explained that it was in the course of preparing for discovery with the nominee that they concluded that the pleadings did not accurately reflect the position taken by the Minister. Although no affidavit was filed with the Respondent's motion supporting this explanation, I accept the explanation.

[7]            The Federal Court of Appeal in Andersen Consulting v. The Queen, [1998] 1 C.T.C. 322 stated at page 327 that they favoured an approach which:

... gives the Court seized with a motion to amend pleadings, including an amendment withdrawing or purporting to withdraw an admission, the needed flexibility to ensure that triable issues are tried in the interests of justice without injustice to the litigants.

I favour a policy which encourages the generous admission of facts. No court wants to discourage defendants from admitting facts. If courts do not permit admissions to be withdrawn when new facts are discovered, parties will be discouraged from making what seem, at the time, to be reasonable admissions. As stated by the Federal Court of Appeal in Andersen at page 327:

... We must ensure that the procedure to withdraw admissions is not made so complex and so stringent that virtually no admissions will be made by defendants.

[8]            Counsel for the Respondent submits that the proposed amended Reply clarifies the position of the Minister and the matters in dispute before the Court. A court should be able to decide cases on correct facts. Prohibiting the Respondent from amending his Reply could force the court to base its decision on an erroneous factual premise. The facts, as initially stated in pleadings, are not necessarily frozen for all time. I agree with the view expressed by Judge Bowman in Continental Bank that to refuse amendments could restrict the ability of the court at trial to consider all aspects of a question on its merits.

[9]            Leave to amend the Reply has been sought by the Respondent prior to examinations for discovery. While 13 months have passed since the original Reply was filed, it is still early in the process. I have not been persuaded that the proposed amended Reply would result in any prejudice or injustice to the Appellant.

[10]          For these reasons, the Respondent's application to amend the Reply is granted on condition that any amended Reply is to be signed by counsel for the Respondent.

Signed at Ottawa, Canada, this 17th day of July, 2001.

"M.A. Mogan"

J.T.C.C.

COURT FILE NO.:                                                 2000-1446(EI) and 2000-1448(CPP)

STYLE OF CAUSE:                                                               Shaw Communications Inc. and The Minister of National Revenue and

                                                                                                Patrick Plummer

PLACE OF HEARING:                                         Ottawa, Ontario

DATE OF HEARING:                                           July 9, 2001

REASONS FOR ORDER BY:                               The Honourable Judge M.A. Mogan

DATE OF ORDER:                                                July 17, 2001

APPEARANCES:

Counsel for the Appellant: Alistair Campbell

Counsel for the Respondent:              Michael Taylor

For the Intervenor:                                                No one appeared

COUNSEL OF RECORD:

For the Appellant:                

Name:                                Alistair Campbell

Firm:                  Felesky Flynn

For the Respondent:                             Morris Rosenberg

                                                                                Deputy Attorney General of Canada

                                                                                                Ottawa, Canada

2000-1446(EI)

2000-1448(CPP)

BETWEEN:

SHAW COMMUNICATIONS INC.,

Appellant,

and

THE MINISTER OF NATIONAL REVENUE,

Respondent,

and

PATRICK PLUMMER,

Intervenor.

Motion heard by telephone conference on July 9, 2001, at Ottawa, Ontario, by

the Honourable Judge M.A. Mogan

Appearances

Counsel for the Appellant:                    Alistair Campbell

Counsel for the Respondent:                Michael Taylor

For the Intervenor:                               No one appeared

ORDER

Upon motion by counsel for the Respondent for an order granting leave to amend the Reply to the Notice of Appeal;

         

And upon reading the affidavit of Linda Plitt, filed;

Aand upon hearing counsel for the parties;

It is ordered that the Respondent be granted leave to amend the Reply to Notice of Appeal in the manner of the draft amended Reply attached to the affidavit of Linda Plitt, on condition that any Amended Reply be signed by counsel for the Respondent.

Signed at Ottawa, Canada, this 17th day of July, 2001.

"M.A. Mogan"

J.T.C.C.