Date: 20061019
Docket: T-1833-05
Citation: 2006
FC 1251
Ottawa, Ontario,
this 19th day of October, 2006
PRESENT: The Honourable Mr. Justice Russell
BETWEEN:
1373997 ONTARIO INC.
Applicant
and
ATTORNEY GENERAL OF CANADA
Respondent
REASONS FOR ORDER AND ORDER
THE APPLICATION
[1]
This
matter began as an application for judicial review of a second-level decision
of the Canada Revenue Agency (CRA), communicated to the Applicant by Mr. Gerald
Travis on October 6, 2005 (Decision).
[2]
The
Decision indicated that CRA would waive interest for an additional period of 16
weeks.
[3]
The
interest was charged on a Notice of Reassessment dated June 14, 2004 for the
1999-08-31 to 2000-08-30 tax year.
[4]
The
Applicant sought an order that the Decision be set aside, with costs, and that
the matter be referred back to another decision-maker with appropriate
directions.
THE HEARING
[5]
The
hearing for the application came before me on July 12, 2006 in Halifax, Nova Scotia.
[6]
Applicant’s
counsel requested an adjournment of the hearing on July 12, 2006 to allow time
for a resolution to the underlying income tax reassessment. I refused the
adjournment and heard full argument. However, I also agreed to reserve judgment
to give the parties some time to resolve their dispute. They were directed to
report back to the Court on their progress in this regard.
[7]
Before I
was able to render reasons and order on the application, the Respondent
received instructions to consent to have the Decision sent back for
re-determination by a different decision-maker, and the Respondent informed the
Court of this consent.
[8]
The
Respondent is also agreeable to having the matter sent back for
re-determination on the understanding that the 16 weeks of interest relief that
had already been granted would not be revised on a new review.
[9]
The
Applicant would not consent to having the matter sent back for re-determination
and indicated that it wanted the Court to deal with the application and issue
reasons on the merits.
THE MOTION
[10]
Because
the Applicant would not consent to having the application sent back for
re-determination by a different decision-maker, the Respondent brought a motion
in writing dated September 8, 2006 (Motion) pursuant to Rules 3 and 392 of the Federal
Court Rules, 1998 and sections 18(1) and 18.1(3) of the Federal Court
Act asking the Court to order that the application of October 19, 2005 made
by the Applicant be granted and that the matter be returned for
reconsideration.
[11]
The
Applicant has resisted the Motion and wants the Court to deny it and then
proceed to deal with the Application and issue reasons that can be used when
the matter is returned for re-consideration.
ANALYSIS
[12]
The Court
will deal with the Application and the Motion together.
[13]
It would
appear from the Motion materials that the Applicant is resisting the Motion
because:
a)
The Motion
makes no mention of the costs sought by the Applicant in the Application;
b)
The Motion
makes no mention of the reasons for which the Decision is referred back for
re-consideration, so that the new decision-maker will not know what
precipitated the judicial review application.
[14]
The
Applicant appears to have a particular concern that while the Respondent has
identified two possible errors in the Decision to justify its consent to a
re-consideration, the Respondent has not addressed the Applicant’s allegations
regarding a reasonable apprehension of bias.
[15]
The
Applicant sums up his objections as follows:
It would frustrate the expectation and
right of aggrieved parties who seek recourse from this Honourable Court via
judicial review applications if the respondent in such applications could
choose to dodge issuance of potentially adverse reasons for judgment simply by
accepting after the launch of such applications that the matter be referred
back for re-election. There is no effectual judicial supervision inherent in
such practice.
[16]
The
Applicant feels aggrieved in this case because “the Respondent has had its
revelation on the road to Damascus following full written and
oral argument by both parties.”
[17]
This is a
slightly odd situation because of my agreement to reserve judgment after the
hearing in order to give the parties time to work out their difference. In the
normal course, had they reached a timely settlement, the Application would have
been dismissed by consent and the parties would have moved forward in
accordance with their settlement.
[18]
It is not
entirely clear to the Court why a settlement has not proved possible, and I
think I must now deal with the Application and the Motion on the understanding
that a disposition of these matters cannot be incorporated into a general
settlement.
[19]
However, I
do not think it is possible for the Court to simply ignore the fact that the
Respondent has consented to the Application and has agreed that the Decision
should be returned for re-consideration. That possibility was not specifically
addressed at the hearing of the Application when I agreed to reserve judgment,
but it was certainly an eventuality that could not be left entirely out of
account.
[20]
It is not
made clear in the Applicant’s response to the Motion whether the Applicant is
prepared to accept a denial of the Applicantion if the Court now gives it full
consideration and issues reasons for judgment. But it seems to me that could be
one result of proceeding in accordance with the arguments put forward by the
Applicant on the Motion.
[21]
This could
potentially result in a bizarre situation whereby the Court denies the
Application even though the Respondent has indicated its consent.
[22]
It seems
to me that the Applicant is simply assuming the Court will grant the Application.
But the fact is that the Applicant is not yet an aggrieved party – to use the
Applicant’s words – because the Court has yet to make a decision on the merits
of the Application.
[23]
It is
quite normal in judicial review proceedings for the Court to acknowledge and
rely upon a consent without reviewing the merits. A consent merely indicates
that the Respondent agrees that the matter should be re-considered. This is,
after all, the relief that the Applicant seeks. There might also be directions
and terms imposed by the Court, even though the parties in the present case
have reached no formal agreement as to what those directions might be.
[24]
But if I
look at the grounds raised by the Applicant in the Application, and the
materials that have been filed with the motion, it seems clear to me that the
Respondent is conceding that the Court could conclude that Decision was made
without reference to the waiver provisions in the Act that allow the deadline
to be postponed, and that the decision-maker did not address the offer made by
the Applicant to waive the statutory time limits. What appears to trouble the
Applicant is that there is no reference to the apprehension of bias ground.
[25]
I regard
the costs issue as entirely separate, and the fact that the Respondent consents
to the Application at such a late date can obviously be addressed in terms of
costs.
[26]
I have
reviewed the apprehension of bias issues raised by the Applicant in his
original application. He has not convinced me that he has raised sufficient
evidence to satisfy the jurisprudence on this point. When the wording he cites
is read in its entire context I cannot conclude that a reasonable person, fully
appraised of that context, would apprehend bias. Hence, I do not believe that anything
needs to be said on the bias matter for the benefit of a future decision-maker.
[27]
As regards
the other possible errors, I believe the Respondent has already sufficiently
acknowledged the difficulties in its materials to allow a future decision-maker
to take full note of the problems that arose in this case and to avoid them in
future. I do not think it would be prudent or an efficient use of Court time
for me to now provide a formal analysis of those grounds that could be at odds
with the concessions already made by the Respondent.
[28]
Hence, I
believe that the most just, efficient and cost effective way to dispose of the
Application and the Motion is to treat the Motion as a concession and agreement
by the Respondent that the Decision should be returned for reconsideration on
the understanding that the 16 weeks interest relief already granted will not be
revised and that the issues raised by the Applicant in the Application will,
apart from the bias issue, be fully considered and taken into account in any
new re-consideration and decision. I believe this result meets the concerns of
both parties.
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