BETWEEN:
GERRY GIONET,
Applicant,
and
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR JUDGMENT
(Edited from the transcript of
Reasons for Judgment delivered orally from the Bench on March 29, 2017 at Calgary,
Alberta)
Campbell J.
[1]
Let the record show that I am giving oral
reasons in the matter of the application for extension of time to file Notice
of Appeal in respect to Gerald Gionet.
[2]
This is an application for an extension of time
in which a Notice of Appeal may be filed in respect to the 2007 through to the
2012 taxation years.
[3]
There is a rather lengthy history in terms of
how this application came before me and those underlying facts are relevant to
the application. The taxation years, 2007 to 2011, were reassessed on February
28, 2013. Mr. Gionet filed a Notice of Objection to these reassessments on
April 2, 2013. The Minister of National Revenue (the “Minister”) issued a
Notice of Confirmation on February 4, 2015 in respect to the taxation years
2007, 2008, 2009 and 2010, but not in reference to the taxation years 2011 and
2012.
[4]
In respect to the objection filed for the 2011 taxation
year, Mr. Gionet was further reassessed by Notice of Reassessment, dated
January 28, 2015. There was no Notice of Objection filed in respect to this
reassessment of the 2011 taxation year.
[5]
In respect to the 2012 taxation year, the
Minister issued a Notice of Reassessment on November 28, 2013. Mr. Gionet did
not file a Notice of Objection to this 2012 reassessment.
[6]
According to the affidavit of Chelene Riendeau,
in 2012 Mr. Gionet filed a tax appeal in respect of his 2006 and 2007 taxation
years. In 2013, this appeal, for the 2006 and 2007 taxation years, was held in
abeyance pending the outcome of several other cases. The parties requested a further
abeyance on November 14, 2014 because the Minister had reassessed the 2007
taxation year and the Applicant had filed an objection to that reassessment. Time
was required to process this objection by the Minister and to determine how Mr.
Gionet intended to deal with the outcome of the objection.
[7]
This further abeyance was granted on December 8,
2014 and on March 11, 2015, the parties advised the Court that Mr. Gionet now
had 90 days from February 4, 2015, being the date in which the Minister
processed that objection, to advise how he intended to proceed. The Court
granted the further abeyance and on June 11, 2015, the Crown advised the Court
that the Applicant had not responded to the Minister’s response to the
objection and that the 90-day period had elapsed for filing an appeal. The
Crown asked the Court for a status hearing to determine how best to proceed in
that the 2007 taxation year had been one of the two taxation years appealed (the
other being 2006) by the Notice of Appeal filed for 2006 and 2007 in 2012.
[8]
On August 17, 2015, the status hearing was held,
although counsel, from Gowlings law office, who had been representing the Applicant
was no longer retained in that capacity and was not present at the status
hearing.
[9]
So the 2006 taxation year was still properly
before the Court as part of the Notice of Appeal that had been filed for 2006
and 2007 taxation years but, because 2007 had been further reassessed and Mr.
Gionet had not filed an objection within the 90-day period, as of the date of the
status hearing, 2007 was now not properly before the Court.
[10]
I have reviewed the transcript of the status
hearing and Chief Justice Rossiter is very clear in his direction to Mr. Gionet
that he should obtain new legal counsel by October 31, 2015 and in addition, ensure
that a motion be brought for an extension of time to appeal the reassessment of
the 2007 taxation year by the same deadline of October 31, 2015. To further
ensure the Applicant understood the Court’s direction, a letter was forwarded
to him on August 21, 2015, reiterating the Court’s direction.
[11]
By October 30, 2015, Mr. Gionet had filed a
Notice of Appointment of Solicitor with Mr. Raj Gill as his new legal counsel.
[12]
On February 3, 2016, Mr. Gill attempted to file
an “Amended Notice of Appeal”, which was received by the Court on December 22,
2015. This “Amended Notice of Appeal” purported to appeal all taxation years,
2007 to 2012, but did not follow the Court’s direction to file an application
for an extension of time.
[13]
A further letter was sent to Mr. Gill on March
17, 2016 advising him that he had to file a Notice of Motion for leave to file
an Amended Notice of Appeal.
[14]
On April 14, 2016, Respondent counsel wrote to
Mr. Gill and Mr. Gionet separately setting out in detail the Crown’s
understanding of the various aspects of the appeal before the Court including
its view of the status hearing that had been held, as well as the purported Amended
Notice of Appeal.
[15]
Finally, on May 4, 2016, a telephone conference
was held with Justice Graham of this Court. Mr. Gionet attended without
counsel, but a Mr. Surinder Makkar of the Avocis Tax Group LLP, who was on the
call as a tax consultant, advised the Court that Mr. Gionet would again be
looking for new counsel. During this telephone conference, the Court pointed
out to Mr. Gionet that he must file an application for an extension of time along
with a Notice of Appeal, sorry, a proposed Notice of Appeal for each of the
taxation years and that he had one day left to do so. The application was filed
on May 4, 2016.
[16]
This brings me to the present application for an
extension of time in which a Notice of Appeal may be filed for these taxation
years. The Applicant, Mr. Gionet, was represented by legal counsel, Faisel
Syed, at the hearing of this application. Counsel for the Applicant argued that
Mr. Gionet had been placed in an untenable position due to the negligence and
failure of a number of previous legal counsel that had been retained to follow
his instructions. Counsel stated that Mr. Gionet has always had a bona fide
intention to pursue this matter in the Tax Court and has spent a great deal of
money attempting to do so. In these circumstances, the Applicant’s counsel
argued that it would be just and equitable that the Court grant this
application.
[17]
I intend to deal with these taxation years in
their reverse order, much the same way as the approach Respondent’s counsel
adopted in her submissions.
[18]
The 2012 taxation year was reassessed on
November 28, 2013, but no Notice of Objection has been filed in respect to
2012. Subsection 169(1) of the Income Tax Act (the “Act”)
respecting appeals to this Court references such appeals being made after a
taxpayer has filed an objection to an assessment by the Minister. Where there
has been no Notice of Objection filed by a taxpayer, this Court has no
jurisdiction to entertain an application for an extension of time to file a
Notice of Appeal. Filing a Notice of Objection is a condition precedent to
bringing an appeal before this Court. Unfortunately for the Applicant, his time
limit for filing an objection in respect to 2012 has also expired. The reassessment
occurred on November 28, 2013 and therefore the 90 days plus one-year timeline
according to the legislation expired on February 21, 2014.
[19]
Next, in respect to the 2011 taxation year, this
year was part of the initial reassessment for the 2007 to 2011 taxation years
on February 28, 2013 to which the Applicant filed an objection on April 2, 2013.
[20]
While the 2007 to 2010 taxation years received
confirmation on February 4, 2015, the Minister further reassessed the taxation
year 2011 separately on January 26, 2015.
[21]
While there was confusion and incorrect
information surrounding this Court’s understanding of the confirmation of 2011
during the telephone conference held in May 2016, which was later corrected by
Respondent counsel in correspondence to Justice Graham, that does not change
the actual dates applicable to the 2011 taxation year. Again, the Applicant did
not file an objection to the 2011 taxation year after the reassessment. The
90-day plus one‑year timeline applicable to this taxation year expired on
April 26, 2016 and this Court simply has no jurisdiction to exercise its
discretion to extend that timeline according to the legislation.
[22]
That brings me to the application respecting the
2007 to 2010 taxation years. This application for an extension of time to
appeal was made within the timelines established in the legislation. Therefore,
the Applicant has complied with paragraph 167(5)(a). However, paragraph
167(5)(b) contains the factors that this Court must address before an order is
made in respect to such an application:
167(5) 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
(A) was unable to act or to instruct
another to act in the taxpayer’s name, or
(B) had a bona fide intention to appeal,
(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.
[23]
Subparagraph 167(5)(b)(i) contains two
conditions. First, the Applicant must convince this Court that he was unable to
act or to instruct another to act on his behalf. Second, that he has bona
fide intention to appeal the matter.
[24]
Although, I heard submissions by Applicant’s counsel
respecting alleged failures, omissions and negligence on the part of various
prior counsel that the Applicant had engaged, present counsel chose not to call
the Applicant to provide testimony in this regard. I have nothing concrete in the
way of specifics before me in the documentary evidence and I have no oral
testimony from the Applicant in respect to what is alleged concerning these
prior counsel.
[25]
In fact, in the transcript of the telephone conference
with Justice Graham, Mr. Makkar, who had acted as Mr. Gionet’s consultant, submitted
that Mr. Gill had been retained, and I quote, in a “…consulting capacity to file
administrative documents…that may be necessary and also to act as an office to
receive any mail from the Court…”. Because it was felt that the issues were
primarily administrative (at this point) Mr. Gill’s office was retained
apparently just for that purpose, and I refer to page 4 of the transcript.
[26]
In respect to the retention of Gowlings law firm,
Mr. Makkar states only that Mr. Gionet was, and again I quote “…unsatisfied
with the services and that Mr. Gionet discussed these issues with Gowlings, found
that they couldn't get to a resolution…”. (Page 3 of the Transcript)
[27]
Apart from these references, I have no oral
testimony from any of these respective parties or the Applicant, no affidavit
evidence submitted or other documentary evidence, which would be texts or emails
respecting communications on the instructions or the actions to be taken or not
taken, or the documents to be filed. In Sapi v The Queen, 2016 TCC 239,
2016 DTC 1197 decision, this Court drew an adverse inference from the failure
of an applicant to call or subpoena certain witnesses to provide such
independent evidence.
[28]
In addition, Mr. Gionet was advised, as well as
his counsel at the time, Mr. Gill, by correspondence from the then Respondent
counsel in April 2015 as to the history and the steps remaining in this regard.
[29]
Based on the documents in front of me and the
submissions by the Applicant’s counsel, these are insufficient for me to
conclude that the Applicant has satisfied the first condition in subparagraph
167(5)(b)(i).
[30]
The result of the failure of Mr. Gionet to
testify and of any other prior solicitors to provide oral or affidavit
evidence, means that I have nothing that supports counsel’s submissions that
the Applicant was unable to personally act or instruct someone to act on his
behalf. I have no independent evidence before me even in the way of emails or
correspondence between Mr. Gionet and these law firms that would support his
present counsel’s submissions in this regard. As a result, I draw an adverse
inference from the failure to do so.
[31]
Subsection (B) of subparagraph 167(5)(b)(i)
references the bona fide intent on the part of the Applicant to appeal. It
is separated from (A) by the word “or”, so these two conditions are disjunctive.
[32]
I do conclude that Mr. Gionet had a bona fide
intent to appeal, which I believe he has demonstrated through the documents. However,
he is still unable to meet the remaining three factors set out in subparagraph 167(5)(b)(i),
(ii), (iii) and (iv). These three factors are connected by the word “and” and
consequently the onus is on the Applicant to convince this Court that it would
be just and equitable to grant the application and permit the appeal to
proceed, that he made the application as soon as circumstances permitted and
that there are reasonable grounds for the appeal. A failure to meet any one of
these conditions will be fatal to the taxpayer’s application. (Dewey v The
Queen, 2004 FCA 82, 2004 DTC 6159)
[33]
The Applicant’s position is that it would be
just and equitable to grant this application because of the alleged negligence,
omissions or failure on the part of prior counsel. However, I go back to my
initial remarks respecting the lack of evidence I have concerning their alleged
conduct and whether it was negligent or not.
[34]
In Di Modica v The Queen, [2001] T.C.J.
No. 620, 2002 D.T.C. 1290, Justice Lamarre Proulx in dealing with an
application to extend the time to file a Notice of Objection, where the
applicant alleged negligence on the part of counsel, she stated the following
at paragraph 16:
It is my view that an error by counsel can
be a just and equitable reason for granting an extension of time if counsel
otherwise exercised the reasonable diligence required of a lawyer. I do not
think that the state of the law is such that counsel's negligence or
carelessness can constitute a just and equitable reason for granting the requested
extension within the meaning of subparagraph 166.2(5)(b)(ii) of the Act.
[35]
In the application before me, there is
insufficient evidence for me to conclude that any of the prior counsel were or
were not negligent or careless or failed or omitted to follow instructions
communicated to them.
[36]
In fact, it appears from the remarks of Mr.
Makkar, during the telephone conference with Justice Graham, that one of the
former counsel, Raj Gill, was simply engaged to act as an administrative
clearing house for receipt of documents from Canada Revenue Agency and this
Court. Based on the evidence before me or lack thereof, I cannot conclude that
it would be just and equitable to permit this application.
[37]
In addition, the evidence is inconclusive to
permit me to conclude that Mr. Gionet acted as soon as circumstances
permitted. During the status hearing held in August 2015, Chief Justice
Rossiter advised the Applicant several times throughout that call of the
necessity of bringing a motion for an extension of time to file an appeal as it
related to the 2007 taxation year because due to the sequence of events, it was
no longer properly before the Court. Yet by the time of the telephone
conference with Justice Graham in May 2016, no such motion had been brought and
I have no evidence before me as to why it was not brought except for various
assertions concerning counsel.
[38]
In addition to his counsel’s submissions, Mr.
Gionet requested that he provide his comments on his application. I permitted
him to do so, although he had not been sworn or affirmed. However, his remarks
focused on the social issues he has encountered as a member of a First Nations group
located in Manitoba. He concluded by stating that he put his trust in lawyers
and accountants and simply wanted his day in Court. Unfortunately, he did not
address the very issues that are at the heart of his application. I gathered
from his comments that he relied on this Court doing what would be fair and
equitable in the circumstances. However, this application must be decided within
the confines of the provisions contained in the legislation.
[39]
It is not open to me to come to a conclusion
based on fairness. I have no discretion to do that. My conclusion to dismiss
the application for these taxation years is based solely on the application of
the wording in the legislative provisions to the facts that were before me at
the hearing.
[40]
That concludes my reasons in respect of the
Gionet application and that concludes the work of the Tax Court today. Thank
you.
Signed at Ottawa,
Canada, this 1st day of June 2017.
“Diane Campbell”
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