Giles,
A.S.P.:—The
motion
before
me
was
to
strike
the
statement
of
claim
as
revealing
no
cause
of
action.
The
statement
of
claim
sought
a
declaration
that
the
Minister's
collection
action
was
improper,
and
an
injunction
restraining
the
Minister
from
instituting
collection
action
until
the
plaintiff's
liability
to
pay
taxes
had
been
determined.
The
situation
was
as
follows:
In
January
1985,
the
plaintiff
designated
$30
million
in
respect
of
scientific
research
credit
and
paid
$15
million
to
a
trustee.
On
March
26,
1985
the
Minister
issued
a
notice
of
assessment
on
account
of
the
plaintiff's
1986
taxation
year
in
the
amount
of
$15
million.
This
was
some
months
before
the
end
or
the
plaintiff's
year
and
before
the
plaintiff
was
obliged
to
file
its
tax
return
for
1986.
This
assessment,
it
is
alleged,
was
accompanied
by
a
written
representation
that
taxes
were
not
then
payable.
This
assessment
did
not
contain
the
standard
notice
to
the
taxpayer
that
a
notice
of
objection
could
be
filed.
The
taxpayer
did
not
file
an
objection
to
this
assessment.
On
July
16,
1985,
the
Minister
instituted
collection
proceedings.
A
number
of
other
collection
proceedings
were
taken
including
the
filing
of
a
certificate
in
the
Federal
Court
on
February
6,
1986
and
the
causing
of
the
issue
of
a
writ
of
fieri
facias.
In
the
summer
of
1986
the
plaintiff
filed
its
1986
tax
return,
was
assessed,
and
filed
a
notice
of
objection.
At
the
initial
hearing
of
this
matter
I
indicated
to
counsel
that
I
understood
that
a
then
recent
decision
of
the
Federal
Court
of
Appeal
in
Optical
Recording
Laboratories
which
had
not
been
referred
to
me,
would
be
determinative
of
the
matter
as
indicating
that
this
Court
had
no
jurisdiction
under
section
18
to
restrain
an
allegedly
illegal
collection
act
of
the
Minister
in
a
matter
where
an
appeal
was
or
would
have
been
possible,
by
the
notice
of
objection
procedure.
I
invited
counsel
to
make
submissions
with
regard
to
Optical
Recording
which
they
did.
That
case
is
The
Queen
v.
Optical
Recording
Laboratories
Inc.,
[1990]
2
C.T.C.
524,
90
D.T.C.
6647
and
deals
with
a
substantially
similar
fact
situation.
In
Optical,
Mr.
Justice
Urie,
for
the
Court,
wrote:
As
held
in
the
Parsons
case,
since
the
Act
expressly
provides
for
an
appeal
of
assessments
made
by
the
Minister,
it
follows
that
section
29
of
the
Federal
Court
Act
precludes
not
only
applications
under
section
28
of
the
Act
in
respect
of
such
assessments
but
also
applications
brought
pursuant
to
section
18,
as
was
done
in
this
case,
to
challenge
not
only
the
assessment
perse
but
the
collection
proceedings
or
action
taken
in
respect
of
those
deemed
valid
assessments.
(Earlier
in
the
report,
the
"Parsons
case”,
is
cited
as
M.N.R.
v.
Parsons
et
al.,
[1984]
2
F.C.
331,
[1984]
C.T.C.
354,
84
D.T.C.
6447.)
I
conclude
that
the
Optical
Recording
case
is
determinative
of
the
issue
before
me
and
that
this
Court
does
not
have
jurisdiction
to
entertain
an
action
under
section
18.
The
defendants'
motion
must
therefore
succeed
and
the
claim
will
be
struck
out
as
revealing
no
cause
of
action.
Order:
Statement
of
claim
is
struck
out
as
revealing
no
cause
of
action
within
the
jurisdiction
of
this
Court.
Application
allowed.
Email this Content