Owen Holdings Ltd. v. R., 97 D.T.C. 380, [1997] 3 C.T.C. 2313

Rip T.C.J.:

1 On November 21, 1996 I heard motions by Owen Holdings Ltd., the appellant, and Her Majesty the Queen, the respondent. The genesis of the motions was orders issued by me on June 27, 1996, September 11, 1996 and September 26, 1996. The motions by the respondent were for orders, amongst other things, to stay or vary my order of June 27, 1996 by the motion by the appellant was to allow its appeal.

Background

2 I wish to review what has taken place up to now so as to assist the reader.

3 The appellant appealed an assessment of income tax for its 1992 taxation year. The Minister of National Revenue (“Minister”) viewed a transaction entered into by the appellant as part of a tax avoidance transaction and invoked the general anti-avoidance provisions of the Income Tax Act (“Act”), section 245 (“GAAR”), against the appellant.

4 After Lists of Documents were filed by the parties in accordance with subsection 81(1) of the Tax Court of Canada Rule (General Procedure), the appellant made a motion, on May 24, 1996, for an order under Rule 82(1) that the respondent file a full List of Documents and produce for discovery an officer or agent who, amongst other things, has complied with Rule 95(2).

5 By order dated June 27, 1996, I directed the respondent to deposit certain documents on her List of Documents in a sealed envelope for delivery to me which she had refused earlier to produce; I would then determine whether the documents, or any one of them, ought to be included in the List of Documents under Rule 82(1).

6 The order of June 27, 1996 also directed the respondent to

...file and serve on the appellant a list of all documents containing a description of any Advance Rulings or Technical Interpretations issued to any other taxpayer concerning the application of general anti-avoidance rules in the Income Tax Act in the context of a transfer of property with an inherent loss to a related party, in accordance with subsection 82(1) of the Tax Court of Canada Rules (General Procedure); copies of such documents shall be made available to the appellant provided that the respondent shall erase or otherwise obliterate the names of any taxpayers which may appear on copies of any such documents.

7 The formal order of June 27, 1996 did not grant the appellant's application that the respondent produce for discovery an officer or agent who had complied with Rule 95(2) since such an order would be premature.

8 The appellant appealed my order of June 27, 1996 to the Federal Court of Canada insofar as I failed to order production of certain categories of documents it requested. The respondent cross-appealed my order of June 27th to the Federal Court of Appeal insofar as I directed the respondent to deposit with the Court documents in an envelope and insofar as I directed the respondent to file and serve on the appellant a List of Documents containing a description of any Advance Rulings and Technical Interpretations issued to other taxpayers concerning GAAR in the context of a transfer of property with an inherent loss to a related party.

9 I heard two more motions on September 5, 1996. The respondent applied for an order that I suspend the operation of my order of June 27th since the order had been appealed to the Federal Court of Canada and compliance with the order would require the commitment of considerable human resources which, if the cross-appeal were allowed, would have been expended without benefit to the litigation. The second motion was by the appellant for an order under Rule 91(c) that the appellant's appeal be allowed since the respondent had failed to file a full List of Documents as required by the order of June 27th and as undertaken to do so by counsel for the respondent, she had failed to file the List of Documents referred to the second part of the order, and she failed to disclose certain documents described in my reasons for the order as undertaken to do so by counsel for the respondent.

10 On September 11, 1996 I dismissed the respondent's motion to suspend the operation of my order of June 27, 1996. On September 26, 1996 I ordered the respondent to deliver all undertakings to the appellant by October 16, 1996. My reasons for the latter order are dated September 26, 1996. I did not at the time release any reasons for my order of September 11, 1996 and I am therefore attaching those reasons as Schedule “A” to these reasons.

Directives Respecting Second Portion of Order of June 27, 1996

11 I am also taking the opportunity of issuing directives with respect to the documents filed with the Court in an envelope. The documents are numbered 198, 199, 203 and 206 in the appellant's List of Documents:

12 No. 198. This document is a “memo”, dated November 30, 1992, of a telephone conversation between officials of Revenue Canada and the Alberta Tax Ministry. The contents of the memorandum are not relevant to the merits of the appeal and neither the memorandum nor telephone message form attached to it need be included in the respondent's List of Documents [Rule 82(1)].

13 No. 199. This describes a bundle of documents and includes a) minutes of GAAR committee and perhaps other Revenue Canada meetings with respect to the appellant and other taxpayers; b) memo for file, dated July 21, 1993, of a telephone conversation by officials of Revenue Canada and also includes hand-written notes; c) memorandum of June 11, 1993 with respect to a draft proposal letter to the appellant but attached to the memorandum is a copy of a proposal letter to a non-resident taxpayer with respect to another transaction; d) a GAAR Committee Meeting Report of April 16, 1993 with a note attached on page one of the two page report that:

when place(d) in taxpayer's file this page was blanked out because it related to other taxpayers - was not exempted because no information was on it

“Bernice Gorner”

A/Asst. Director ATIP

14 Only those documents referred to as No. 199 which relate only to matters affecting the appellant ought to be included in the respondent's List of Documents [Rule 82(1)]. These include documents described in a), b), c), d) and e) above. Officials of the Minister shall delete sections or portions of copies of these documents, such as minutes of GAAR committee meetings which do not relate to, or affect, the appellant, which are delivered to the appellant. For example, on the first page of No. 199, paragraphs 3 and 4 are to be deleted, paragraph 5 is to remain. Any portion or document referring to the Owen Family Trust shall also be included in the respondent's List of Documents unless it is obvious the reference is clearly irrelevant to the appellant's appeal. As far as the documents in c) are concerned, the Minister's officials are to produce the draft proposal letter to the appellant referred to in the memorandum, if such draft exists, but not the draft proposal letter to the non-resident unless the contents relate to the issue in appeal; in such case the identities of other taxpayers are not to be revealed but the integrity of the contents of the draft letter is not to be destroyed.

15 There is no reason the documents in No. 199 ought not be included in the respondent's List of Documents [Rule 82(1)]. Copies of these documents shall be delivered to the appellant with appropriate deletions or alterations so as to protect the identity of other taxpayers. The integrity of the contents of the documents is to remain. The contents of these documents may or may not assist the appellant in making its case, but it is entitled to them. The appellant has a right to know the “thinking” of the Minister's officials when they caused the appellant to be reassessed.

16 No. 203. This document is referred to as a “Complexity Rating Schedule”. I see no reason why it should not be included in the respondent's List of Documents [Rule 82(1)]. Although the information on the document is rather cryptic and appears to have been prepared for internal administrative purposes, the appellant should have the opportunity to discover the respondent's representative as to its import, if any.

17 No. 206. These documents refer to discussions between officials of Revenue Canada and the Alberta Tax Ministry and are not relevant for purposes of this appeal.

Motions Before The Court

18 Finally, we arrive at the applications now before me. On November 21, 1996 the respondent moved for:

1. an Order varying the Order of the Court dated June 27, 1996, or granting other relief to permit the Respondent to make all necessary deletions to protect confidential taxpayer information as referred to in s. 241 of the Income Tax Act in any Advance Rulings or Technical Interpretations to be produced under paragraph (b) of that Order;

2. an Order suspending the operation of the Order of June 17, (sic) 1996, or such varied Order that may be made, pending the disposition of the Appeal and the Cross-Appeal from the Order of June 27, 1996, filed in the Federal Court of Appeal July 12, 1996 and July 18, 1996, respectively.

19 On the same day, the appellant, by notice dated November 14, 1996, moved for an order under Rule 91(c) that the appellant's appeal from an assessment of tax be allowed since the respondent has failed to comply with orders dated June 27 and September 26, 1996 in that the respondent has failed to deliver to the appellant at times required copies of Advance Rulings and Technical Interpretations referred to in the second part of the June 27, 1996 order.

20 Also, on November 21, 1996, the respondent made a cross-motion for:

1. an Order abridging the time for filing and service of the Cross-Motion;

2. an Order extending the time for filing and serving the Rule 82 List of Documents to October 24, 1996;

3. an Order relieving the Respondent from producing Advance Rulings and Technical Bulletins falling with (sic) the terms of the Order of June 27, 1996 for production and inspection until all necessary deletions to protect confidential taxpayer information as referred to in s. 241 of the Income Tax Act have been made;

4. an Order suspending the operation of that part of the Order of Sept. 26, 1996 relating to Advance Rulings or Technical Interpretations[FN1: <p>Documents filed by the parties refer to both Technical Bulletins and Technical Interpretations. I understand these are one and the same.</p>] pending the disposition of the Appeal and the Cross-Appeal from the Order of June 27, 1996, filed in the Federal Court of Appeal July 12, 1996 and July 18, 1996, respectively.

5. an Order dismissing the Motion of the Appellant of November 14, 1996;

21 Some of the orders sought by the respondent in her motion and cross-motion are similar.[FN2: <p>See paragraphs 1 and 3 of the respondent's motion and cross-motion and paragraphs 2 and 4 of the motion and cross-motion respectively.</p>]

22 Mr. Nitikman, counsel for the appellant, advised the Court that his client had no objection to me abridging the time for the filing and service of the cross-motion and to extend the time for filing and serving the Rule 82 List of Documents to October 24, 1996. Such orders will be issued.

23 There are then essentially two motions by the respondent, to vary my order of June 27, 1996 and to suspend operations of my order of September 12, 1996 pending the appeals to the Federal Court of Appeal and one motion by the appellant, to allow its appeal. I shall consider now each motion.

A. By the respondent, to vary the order of June 27, 1996 or grant other relief to permit her to make deletions to protect confidential taxpayer information.

24 There is no question that

[I]nterlocutory orders are subject to be vacated or modified by the court of first instance if the circumstances have materially changed.

25 A court has no power, jurisdiction or authority to amend a judgment or order that changes its decision on a matter of substantive right after its judgment has been drawn up and entered.[FN4: <p><em>Minister of National Revenue v. Gunnar Mining Ltd.</em>(1970), 70 D.T.C. 6135 (Can. Ex. Ct.)</p>] The general good of the community requires a final end to be put to litigation.[FN5: <p>See, for example,<em>Gunnar Mining Ltd.</em>,<em>supra</em>, at p. 6144 and<em>Laskaris v. Minister of National Revenue</em>(1990), 90 D.T.C. 1364 (T.C.C.), at p. 1367.</p>] The Supreme Court stated that there is no power to amend a judgment that has been drawn up and entered except in two cases:

1. when there has been a slip in drawing it up (commonly known as the “slip” rule), or

2. where there has been error in expressing the manifest intention of the Court.

26 Rule 172(1)(a) provides that a judgment that contains an error arising from an accidental slip or omission may be amended on motion.

27 Respondent's counsel submitted that I may amend an order if the order does not express my manifest intention that taxpayer information, including the identity of the taxpayers referred to in the Advance Rulings and Technical Interpretations, remain confidential.

28 Counsel for the respondent submitted that on the authority of Etienne v. R. (1993), 164 N.R. 318 (Fed. C.A.), a judge cannot vary an order because of new facts on which the judge did not previously adjudicate. Nevertheless a judge may amend or vary an order where it does not express his or her manifest intention. A judge is not functus if the judge's manifest intention is not expressed in the order: First City Trust Co. v. Triple Five Corp. (1991), 80 Alta. L.R. (2d) 190 (Alta. C.A.), at 192 and Bank of Nova Scotia v. Golden Forest Holdings Ltd. (1990), 98 N.S.R. (2d) 429 (N.S. C.A.)and(1990), 263 A.P.R. 429 (N.S. C.A.), at p. 431.

29 Appellant's counsel argued that even if the doctrine of manifest intention exists, the Tax Court, being a statutory court created under the authority of section 101 of the Constitution Act, 1867, does not have the jurisdiction to amend an order notwithstanding that the order may not express the manifest intention of the Court. Such jurisdiction lies only in courts of original jurisdiction. His authority is Bank of Nova Scotia, supra, at 431, where Hallett J.A. writing for the Nova Scotia Court of Appeal quoted Halsbury's Laws of England, (4th Ed. 1982), vol. 37, at p. 23 to describe the inherent jurisdiction of the court:

In sum, it may be said that the inherent jurisdiction of the court is a virile and viable doctrine, and has been defined as being the reserve or fund of powers, a residual source of powers, which the court may draw upon as necessary whenever it is just or equitable to do so, in particular to ensure the observance of the due process of law, to prevent improper vexation or oppression...

30 This Court is not a court of equity, said counsel. To grant the respondent's motion to vary I must find my authority in Rule 172.

31 I do not read the Bank of Nova Scotia, supra, for the proposition that a statutory court has no inherent jurisdiction. A judge of a court, whether of original jurisdiction or a section 101 court, must have some authority vested in or attached to him or her so that he or she may do justice between the parties and secure a fair trial between them. A judge of a statutory court cannot sit by and tolerate a possible wrong occurring in the courtroom. In today's society a court's inherent jurisdiction cannot depend solely on that court's origins. I believe I have the authority to amend an order to better reflect my manifest intention; however, my authority to do so is limited to what I reasonably contemplated or could have reasonably contemplated, at the time of the original order. In the appeals of First City Trust Co., supra, and Dumont v. Law Society (Prince Edward Island) (1989), 42 C.P.C. (2d) 279 (P.E.I. C.A.), for example, the appellate courts considered only the inherent jurisdiction of courts of original jurisdiction. They did not comment on statutory courts.

32 In his reasons in Minister of National Revenue v. Gunnar Mining Ltd., supra, Jackett P., as he then was, analyzed the application of the “slip” rule when he considered the power of the Tax Appeal Board to change its record of judgment or otherwise make corrections. He was satisfied

...that the Tax Appeal Board, which is a court of record, has the inherent power to change the record[FN7: <p>Having regard to the fact that the Board's formal judgment was apparently settled concurrently with the issuance of its Reasons, no question arises here as to whether it has the power of most common law courts to rehear a matter and reconsider its judgment at any time before its judgment is settled and entered.</p>] of a judgment pronounced by it so that it will express the order actually made by the Board even though there is nothing in the statute law or the regulations that expressly permits it to do so.[FN8: <p><em>Supra</em>, pp. 6144-6145 (emphasis added).</p>]

33 Jackett P. reviewed several cases dealing with whether a court expressed its manifest intention.[FN9: <p><em>Supra</em>, p. 6146.</p>] Among these cases is Thynne v. Thynne,[FN10: <p>[1955] P. 272 (Eng. C.A.), cited in<em>Gunnar Mining Ltd.</em>,<em>supra</em>, at p. 6146.</p>] where it was held that the Court could correct a divorce decree after it became absolute to make it recite the marriage ceremony which created the state of marriage that was dissolved by the decree instead of a subsequent ceremony that was only one of which the Court had been informed before the divorce decree was pronounced. In the view of Jackett P.:

[T]his would seem to go somewhat further than the bounds established in the Paper Machinery case, supra, but does not go any further than making changes necessary to make the judgment reflect what the Court really intended to do.... These cases can have no application here where it is clear that the Board did not have in mind, when it delivered its original judgment, the quite different judgment substituted by the later order.

34 A judge of the Tax Court has the inherent power to amend an order or judgment when it does not express his or her manifest intention.

35 Appellant's counsel also submitted that once the Crown cross-appealed the order of June 27, 1996, no motion to vary that order is permissible and that an order to vary would be inappropriate. He relied, inter alia, on the authority of the following cases: Etienne, supra, and Apotex Inc. v. Canada (Attorney General) (1986), 3 F.T.R. 239 (Fed. T.D.), Flexi-Coil Ltd. v. Smith-Roles Ltd. (1985), 4 C.P.R. (3d) 174 (Fed. T.D.)and Zeneca Pharma Inc. v. Canada (Minister of National Health & Welfare) (1996), 66 C.P.R. (3d) 169 (Fed. T.D.). An order is “crystallised” once appealed, and the proper place to deal with it is the Federal Court of Appeal: Western Caissons Ltd. v. Zurich Insurance Co. (1993), 137 A.R. 377 (Alta. Q.B.), at p. 381.

36 In Etienne, Hugessen J.A. stated, at pp. 318-319:

While we would not state the question in terms of“ jurisdiction” nor of “functus officio”, as did the motion judge, we think he was correct to view it as inappropriate for a trial judge to deal with an application under rule 1733[FN11: <p>Rule 1733 of The Federal Court states that “A party entitled to maintain an action for the reversal or variation of a judgment or order upon the ground of matter arising subsequent to the making thereof or subsequently discovered, or to impeach a judgment or order on the ground of fraud, may make an application in the action or other proceeding in which such judgment or order was delivered or made for the relief claimed.”</p>] [see footnote 1] in respect of his own judgment at a time that an appeal from that judgment was pending.

37 If evidence is discovered after the trial, the proper remedy is to introduce such evidence before the Court of Appeal, said Hugessen J.A.

38 However, the Trial Division of the Federal Court has on at least one occasion permitted an order to be amended notwithstanding the order had been appealed when the order did not reflect the intent of the written reasons due to an oversight or omission. Rouleau, J. held it was in the interests of justice that the order be amended to reflect the decision of the presiding judge: Metaxas v. “Galaxias” (No. 3) (1988), 24 F.T.R. 241 (Fed. T.D.), at p. 242. Rouleau J. referred to the decisions of Flexi-Coil Ltd., supra, and Apotex, supra.

39 Also, in A.H. Al-Sagar & Brothers Engineering Project Co. v. Al- Jabouri (1989), 46 C.P.C. (2d) 69 (Ont. H.C.), Sutherland J. had no difficulty in concluding, at pp. 77-78, that solely because a judgment of the Court had been appealed and the appeal is pending

...does not preclude the bringing of a motion to this Court under r. 59.06(2) for the variation or setting aside of this Court's Judgment on the basis of evidence that has arisen since that judgment was pronounced.[FN12: <ul>Section 59.06(2) of the Ontario Rules of Civil Procedure provides that:<li><ul>(2) A party who seeks to,<li><p>(a) have an order set aside or varied on the ground of fraud or of facts arising or discovered after it was made;</p></li><li><p>(b) suspend the operation of an order;</p></li><li><p>(c) carry an order into operations; or</p></li><li><p>(d) obtain other relief than that originally awarded, may make a motion in the proceeding for the relief claimed. O. Reg. 560/84.</p></li></ul></li></ul>]

40 Sutherland J. was of the view (p. 78) that the

[w]ork loads and consequent time pressures at the appellate levels ... make it desirable that as many loose ends as possible are dealt with at the trial Court level, so there will be a complete record to go before the appellate Court.

41 I am inclined to adopt the reasons of Sutherland J. Where it is possible for a trial Judge to correct an order he or she should do so notwithstanding that the order has been appealed, if it appears from the Notice of Appeal or Cross-Appeal that amendment does not affect the substance of the issue in appeal. If an amendment to the order does not affect the principle ground or the general thrust of the respondent's cross-appeal, such an amendment is proper. For example, an amendment that the respondent need not file and serve the List of Documents would be improper since that would be a complete change to the order. An amendment correcting a slip or clarifying the judge's intent would be proper. A lower court should, if possible, do whatever housecleaning is necessary to ensure the appellate court has a complete record to consider the matter before it.

42 In the matter at bar, the Crown has cross-appealed my order of June 27, 1996 to the Federal Court of Appeal insofar as I ordered the deposit with the Tax Court in an envelope of copies of certain documents, and insofar as I ordered the respondent to file and serve on the appellant a List of Documents

...containing a description of any Advance Rulings or Technical Interpretations issued to any other taxpayer concerning the application of general anti-avoidance rules in the Income Tax Act in the context of a transfer of property with an inherent loss to a related party.

43 On the basis of the reasons for the order of June 27th and my comments during the hearing of motions in May and September, respondent's counsel submits that my manifest intention was to protect the confidentiality of the identities of the taxpayers who had obtained the Advance Rulings and Technical Interpretations and the means by which this was to be done was secondary. My order referred only to the means by which I wished the confidentiality to be retained and not the purpose.

44 Respondent's counsel also suggested that I had not adjudicated that documents disclosing identities of taxpayers be disclosed without further editing and it was therefore available to me to indicate this in an amended order. Counsel referred to the decision Tak Ming Co. v. Yee Sang Metal Supplies Co., [1973] 1 All E.R. 569 (Hong Kong P.C.), a decision of the Privy Council.

45 Appellant's counsel said that the matters regarding the confidentiality of taxpayers were brought to my attention because now “we know what the problem is”. He declared that the facts as to confidentiality were discovered after my previous orders had issued and after reasonable diligence was taken by officials of Revenue Canada in searching for documents. The respondent, he submitted, should not be held to a strict standard as fresh evidence in an appeal.

• Copies of such documents shall be made available to the appellant provided that the respondent shall erase or otherwise obliterate the names of any taxpayers which may appear on copies of any such documents

do not protect the identity of the taxpayers as I had intended. Counsel referred to transcripts of the hearing of the motions on May 28, 1996 and September 4, 1996.

47 On May 28, 1996, in discussion with counsel for the respondent during his submissions, I stated:

I mean, the names don't have to be given to him. The names could be blanked out.

48 On September 4, 1996, Mr. Paris, counsel for the respondent, was concerned that the Minister may suffer irreversible harm if Advance Rulings and Technical Interpretations were released to the appellant. On page 39 of the transcript is the following exchange between counsel for the respondent and me:

HIS HONOUR: What is the harm? What is the harm if you do give it to them and then they find it's irrelevant — the Federal Court finds it's irrelevant?

MR. PARIS: On two bases, Your Honour. There is the fact that these are tax rulings which are particular to individual taxpayers.

HIS HONOUR: No, but in my order I said the names of the people will be struck out.

MR. PARIS: But there is also the possibility that the fact situations are so particular to an individual taxpayer, that there can be an identification by that means.

HIS HONOUR: That was never alleged.

MR. PARIS: Secondly, Your Honour —

HIS HONOUR: That was never alleged.

49 Also, in my Reasons for Order of June 27, 1996 I stated, at page 14 of the Reasons

I am inclined in these circumstances to allow the applicant access to copies of category IX documents. However, names of all taxpayers on such documents shall be erased or obliterated so their names will remain confidential.

50 The respondent has filed two affidavits of officers of Revenue Canada, by William Ernest Harris, a Section Chief in the Reorganizations and International Section of the Income Tax Rulings and Interpretation Directorate of Revenue Canada, and the other, by Michael Hiltz, Director of that Directorate and Harris' superior.

51 Harris was assigned to search Revenue Canada's data bank for all documents which may be subject to my order of June 27, 1996. He started his search on July 9, 1996 and by July 12th he had identified approximately 140 documents which may fall within “the scope” of the order. On July 15th he was informed of the appellant's appeal of my order and the respondent's intention to cross-appeal and, therefore, stopped his search.

52 When the Crown's motion to stay the order was denied, Harris continued his search on or about September 9th. On September 13, 1996 he began to print approximately 155 documents. He read those documents and identified 89 as falling, or possibly falling, within the order of June 27, 1996. He searched the data bank for additional documents on or about September 25, 1996 to find additional documents dealing with facts similar to those in the appellant's appeal where there was a consideration of GAAR. A list of 279 documents was created.

53 Harris had meetings with Hiltz and Roger Taylor, respondent's lead counsel, to discuss compliance with the order and they agreed a further search should be made on the category “winding-up of wholly-owned subsidiairies”. Four additional documents were found in the data bank. The total documents found which appeared to be relevant were 93. New searches were made for documents where subsections “69(5) and 245(2)” of the Act were considered. No new documents were found.

54 Harris explained that an advance income tax ruling identifies the representative of taxpayer who requested the ruling, the parties to the ruling, a detailed description of relevant facts of the taxpayers involved and of the proposed transactions in ruling requested. A majority of the rulings reviewed by Harris were in excess of 10 pages long and some were as long as 20 pages or more. Of the 93 documents, Harris identified 45 documents in respect of which the deletion of only the taxpayer's name, in his view, would not protect the identity of the taxpayer and the production of which would require the disclosure of taxpayer information as defined by section 241 of the Act. In his view the detailed description of the facts of the transactions remaining after the obliteration of the names of the taxpayers are so descriptive so as to sufficiently identify the taxpayers involved. He states he identified a further 33 documents in respect of which the deletion of only the taxpayer's name or names, again in his view, might not protect the taxpayer's identify and production of which might require the disclosure of taxpayer information. These 33 documents identify public companies with their names and addresses or their representatives, or describe a unique business or relate to specific real estate which is identified by municipal address.

55 In Harris' view there were only 15 documents in which the deletion alone of the taxpayer name or names would be sufficient to protect the taxpayer's identity or identities.

56 Harris fears that it is possible that the confidentiality of taxpayer's identity or identities could be compromised by the name and address of the taxpayer's representative, the date of incorporation or amalgamation, the incorporated jurisdiction, and the day and month of the advance rulings and the production of which might require the disclosure of taxpayer information as defined by the Act.

57 Harris stated that in most cases it is possible to protect the identity of the taxpayers in these documents by editing out other taxpayers information in addition to names of the taxpayers. An example of such a document was attached to his affidavit. This document is one which has been released to the public pursuant to Revenue Canada's policy to publish rulings issued after 1995 when the taxpayer agrees.

58 Hiltz described the concept and procedure of advance income tax rulings and his concern with the release of information:

4. The provision of advance income tax rulings is an administrative service and there is no legal requirement for the Department to issue them. Subject to certain exceptions (such as “capital versus income” questions, questions which are currently before the courts, and questions of foreign law), the Department does consider all requests for advance income tax rulings.

5. An advance income tax ruling is a written statement given by the Department to a taxpayer stating how it will interpret and apply specific provisions of existing Canadian income tax law to a definite transaction or transactions which the taxpayer is contemplating. Accordingly, an advance income tax ruling may be either favourable or unfavourable to the interpretation desired by the taxpayer. An advance income tax ruling given by the Department applies only to the taxpayer who requested it or on whose behalf it was requested.

6. The ruling itself is usually addressed to the taxpayer's representative, contains a statement of the circumstances of the taxpayer, a description of the transactions the taxpayer proposes to undertake, and a statement of how Revenue Canada will apply particular provisions of the Income Tax Act to the proposed transactions.

7. All information which directly or indirectly reveals the identity of a taxpayer, which is provided by taxpayers in the course of a request for an advance income tax ruling, must be kept confidential pursuant to subsections 241(1) and 241(10) of the Income Tax Act. In addition, based on my experience and contacts with taxpayers and their representatives I believe that there is an expectation on the part of taxpayers requesting advance tax rulings that information provided in the course of a request will remain confidential.

8. Based on my experience I believe that if confidential taxpayer information were made public, the advance rulings process would be seriously damaged. Taxpayers would be reluctant to provide information which contained sensitive information. As a result, taxpayers would either not submit advance ruling requests or would submit the request without the fullest disclosure of the information required to properly evaluate the proposed transaction and the benefits to taxpayers and to the income tax administration of the advance ruling system would be lost.

9. With the consent of the taxpayer, all advance income tax rulings issued after 1995 either have been or will be released to the public in edited form. Under this process, all information which had been provided to the Department on a confidential basis and which could identify the taxpayer or taxpayers involved in the ruling, is edited out. The edited advance income tax rulings are then distributed electronically to various publishers of income tax information and are also available to the public for viewing (in electronic format) in the reading rooms of Revenue Canada Tax Services Offices.

59 Counsel for the appellant argued that Hiltz knew at all times that rulings contained confidential information but it is only for the purpose of the motion now before me, the third motion, that the respondent first raises the issue of confidentiality. This matter was not raised during the hearing of the motion on May 28, 1996. Indeed it was I who originally addressed the issue during the hearing on May 28th and again in the order. In counsel's view, it is too late for the respondent to raise the issue and I ought not vary the order of June 27th for that reason: Bow River Pipe Lines Ltd. v. R. (1996), 96 D.T.C. 1414 (T.C.C.), at p. 1415 per Christie A.C.J.T.C.C.

60 Appellant's counsel stated the initial request for the Advance Rulings and Technical Interpretations was made to the respondent's counsel on March 12, 1996. Harris' affidavit states he did not begin his search until the June order had been issued that he stopped searching on July 15, 1996, when he learned that a cross-appeal would be filed. He did not begin searching again until September 9, 1996. Counsel stressed that there is no evidence that documents could not have been found prior to the hearing of the first and second motions. There is no evidence that Harris' reading and classifying of documents from September 13, 1996 to October 16, 1996, could not have been done prior to the May 28, 1996 hearing even though the documents were in existence at the time. Counsel also stated that the respondent never alleged that the failure to make the searches and classify documents before June 1996 arose through negligence, inadvertence or even accident. Counsel referred to Spencer-Bower and Turner, Res judicata, (2nd ed. 1968) 1601-61; Doering v. Grandview (Town) (1975), [1976] 2 S.C.R. 621, 61 D.L.R. (4th) 455 (S.C.C.); Modlivco v. R. (1995), 95 D.T.C. 692 (T.C.C.); Modlivco Inc. v. R. (1996), 96 D.T.C. 1516 (T.C.C.).

61 In replying to a question put by me, counsel for the appellant stated that he requires the confidential information, other than the names of the taxpayers, contained in the various documents, since it is “difficult to read severed information in the rulings” and “in allowing the Crown to unilaterally sever what Revenue Canada deems to be confidential, there is a danger” that not all of the salient information may be forthcoming. There is no procedure for the appellant to ensure officials of the Minister edit the contents of the documents properly. The Minister's officials cannot be cross-examined on the means they adopted to edit the documents.

62 Given that the various provisions under section 241 deal with “taxpayer information”, the key to this issue is whether the advance rulings constitute “taxpayer information” as defined by subsection 241(10). Unless the information in question meets that definition, it is not subject to any obligation of confidentiality under this section.

63 The definition of “taxpayer information” includes information that is “obtained by or on behalf of the Minister for the purposes of this Act”. A plain reading of this phrase might lead one to conclude that since advance rulings are voluntarily submitted by taxpayers, they are not “obtained by” the Minister. The Shorter Oxford Dictionary defines the word “obtain”:

To procure or gain, as the result of purpose and effort; hence, generally, to acquire, get....

In order to succeed, the appellant had to demonstrate that the documents in question were of a confidential nature within the meaning of subsection 241(1), i.e., that they were: i) “obtained by or on behalf of the Minister”, ii) “for the purposes of the Income Tax Act”.

Section 241 cannot be interpreted in a vacuum. The legislative intent, admittedly, is the protection of the confidentiality of information given to the Minister for the purposes of the Income Tax Act. The privilege is not established in favour of Revenue Canada but in favour of those, particularly the taxpayer, who give information to the Minister on the understanding that such information will remain confidential.

The most usual and natural meaning of the word“ obtained” and of its French equivalent “obtenir”, whether read in the context of “any information” as in section 241(1)(a) or in the context of“ other document” as in subsection 241(1)(b), is that of information or document not in the possession of the person seeking either and being“ given” to that person. In my view, in order to be “obtained” within the meaning of subsection 241(1), a document must be either a document in the possession of someone else than the Minister or his officers, or a document prepared by the Minister or his officers but on the basis of information given to them that has remained confidential. For example, internal self-generated documents, as they were described by the appellant, could well be subject to the statutory prohibition against disclosure if they are based on information given to the authors of the documents under the Income Tax Act and not released to the public through court proceedings.

64 Despite not being actively obtained by the Minister, advance rulings are documents prepared by the Minister on the basis of information given to him. Hence, one must conclude that information contained in advance rulings was “obtained by or on behalf of the Minister”.

65 Appellant's counsel argued that since the system of advance rulings has no statutory basis, information given to the Minister for an advance ruling cannot have been obtained “for the purposes of this Act”. If these purposes are to be perceived narrowly, then, as appellant's counsel suggested, since the Act makes no mention of advance rulings, it cannot be said that they fulfill a purpose which has been recognized by Parliament and thus be given effect in the Act. However, a broader approach ought to be taken: advance rulings do fit within the broader ambit of the Act.

66 Messers. Hiltz and Harris have described the purpose and nature of advance rulings. The practise of issuing advance rulings serves the Minister's purposes of encouraging voluntary compliance, promoting uniformity in the application of the law, fostering and encouraging the self-assessment component of the tax system, and in promoting public confidence in the integrity of the tax system. The interests of taxpayers in seeking advance rulings may differ, however, as they are more typically motivated primarily by the desire for greater certainty regarding the tax aspects of proposed transactions.

67 Bowman J.T.C.C. recognized the importance of advance rulings in Goldstein v. R (1995), 96 D.T.C. 1029 (T.C.C.), at page 1034, footnote 10:

I leave aside entirely the question of advance rulings which form so important and necessary a part of the administration of the Income Tax Act. These rulings are treated by the Department of National Revenue as binding. So far as I am aware no advance ruling that has been given to a taxpayer and acted upon has ever been repudiated by the Minister as against the taxpayer to whom it was given. The system would fall apart if he ever did so.

68 The systems of Advance Rulings and Technical Interpretations are now so imbedded in the day-to-day administration of Revenue Canada and both the Canadian taxpayer and the fisc find the systems mutually beneficial. It would thus be reckless for me to suggest that it is beyond the Minister's authority under the Act to issue Advance Rrulings and Technical Interpretations. Information used in Advance Rulings and Technical Interpretations is “taxpayer information” contemplated by subsection 241(10).

69 Section 241 applies to protect the confidentiality of the information contained in Advance Rulings and Technical Interpretations. Taxpayer information, as defined by subsection 241(10), ceases to be taxpayer information when it “does not directly or indirectly reveal the identity of the taxpayer to whom it relates”.

• b) The respondent shall file and serve on the appellant a list of all documents containing a description of any Advance Rulings and Technical Interpretations issued to any other taxpayer concerning the application of general anti-avoidance rules in the Income Tax Act in the context of a transfer of property with an inherent loss to a related party, in accordance with subsection 82(1) of the Tax Court of Canada Rules (General Procedure); copies of such documents shall be made available to the appellant provided that the respondent shall edit such documents sothat the information contained in them shall not directly or indirectly reveal the identities of the taxpayers to whom they relate; and if the results of the editing of the documents affect the integrity of any Advance Rulings and Technical Interpretations so that a person experienced in such matters is unable to comprehend the tenor of the document, the respondent is directed to request in writing from the taxpayer his or her authorization to release the document to appellant's counsel. If authorization is not received within 21 days of the request, then the respondent shall cause the Minister, with legal advice, if necessary, to prepare a narrative description of the Advance Rulings and Technical Interpretations describing the facts in general terms, ensuring the identities of taxpayers remain confidential, and how the Minister applied the law to these facts.

• The respondent shall file her List of Documents and produce for inspection copies, extracts or narratives of the Advance Rulings and Technical Interpretations so required to be produced and inspected within 60 days.

71 Respondent's counsel informed me at the hearing of the motions that the respondent would require three weeks to prepare the documents for production and inspection. Since my order requires more effort on the part of the respondent than anticipated at the hearing, I have given the respondent 60 days to prepare the documents. I assume this is sufficient time.

72 I do not believe this is a matter in which the law contemplates that a judge should be called upon to decide whether the Minister has properly edited an Advance Rulings and Technical Interpretations. The appellant is entitled to the Advance Rulings and Technical Interpretations but not at the cost of revealing the identity of the taxpayers. The provisions of section 241 protect these taxpayers' identities.

B. By the respondent, to suspend the operation of the order of June 27th or such varied order that may be made, depending on the disposition of the appeal and cross-appeal.

73 The grounds for which the respondent asks the order of June 27, 1996 be suspended are that a) to the extent to which there will be disclosure of taxpayers identities in the Advance Rulings and Technical Bulletins to be produced was not known until after September 13, 1996 and b) would cause irreparable harm to the appellant and to those taxpayers whose identities may be disclosed and who are parties to the appeal, and c) pursuant to subsections 241(6), (7) and (8) of the Act, the respondent's cross-appeal to the Federal Court operates as a stay of the order of June 27, 1996.

i) Subsection 241(8) stay.

74 I shall deal with the last ground first. I am not of the view that solely due to the respondent's cross-appeal of the order of June 27, 1996 to the Federal Court of Appeal, that order is suspended. Subsection 241(8) of the Act states that “on appeal instituted pursuant to subsection (6) shall stay the operation of the order or direction appealed from until judgment is pronounced”. However, for such an order to be appealed “pursuant to subsection (6)” notice must be served “on all interested parties”. Subsection 241(6) reads as follows:

An order or direction made in the course of or in connection with any legal proceedings requiring an official or authorized person to give evidence relating to any information or produce any book, record, writing, return or other document obtained by or on behalf of the Minister for the purposes of this Act or the Petroleum and Gas Revenue Tax Act, may, by notice served upon all interested parties, be appealed forthwith by the Minister or by the person against whom the order or direction is made to

• (b) the Federal Court of Appeal, in the case of an order or direction made by a court or other tribunal established by or pursuant to the laws of Canada.

75 In the matter at bar, the “interested parties” include not only the appellant and respondent but also those taxpayers who provided information contained in the Advance Rulings and Technical Interpretations to which the appellant is entitled. It is their identities that the respondent is required not to reveal. I was advised by counsel for the respondent that the notices of the cross-appeal have not been served on these “interested parties” and thus the respondent's cross-appeal does not appear to have been instituted pursuant to subsection 241(b). The order cannot be said to be stayed by virtue of subsection 241(6). I realize this is a “Catch 22” situation for the Crown. If notice is given to all such interested parties their identities will become known to the appellant, at least. And if no notice is served on the interested parties, no cross-appeal may lie pursuant to paragraph 241(1)(b).

ii) Extent of Disclosure not known until September 1996

76 Roger Taylor, respondent's lead counsel in this appeal, filed a lengthy affidavit in support of the respondent's motions. Much of what is in his affidavit is contained in Harris' affidavit. However, he states that following a meeting with Hiltz and Harris on September 25, 1996 he realized there was a problem in respect of the protection of the taxpayers involved in the advance rulings and advised appellant's counsel of his concern:

...Having regard to the concern which Judge Rip had expressed in his Reasons for Order to protect the confidentiality of the identity of the taxpayers involved in these Rulings, I expressed the view that we were caught between the spirit and the letter of the said Order....

77 In Etienne, supra, Huggessen J.A. stated that if evidence is discovered after trial, the proper remedy is to introduce the evidence before the Court of Appeal under Rule 1102(1). Appellant's counsel has taken the position that the Minister knew, or ought to have known, as early as May, 1996 of the extent to which the safeguarding of taxpayers' identities was a potential problem. But, as revealed by Harris, nothing was done until September 1996, after the hearing of the first series of motions in May. The Crown had failed to earlier search its files and review the relevant advance rulings. Taylor never pretended this evidence was unavailable in May, 1996. Appellant's counsel argued a motion for a stay in such circumstances is barred by res judicata: Doering, supra, at p. 638 per Ritchie J.

78 I do not subscribe to the view of appellant's counsel that the knowledge in September by the Minister's officials of the extent of those taxpayers whose identities may have to be revealed as a result of my order is new evidence in the circumstances. Before June 27, 1996 there was no legal obligation for the Minister to initiate any search if she was of the opinion that any such search would yield only taxpayer information that she is precluded from disclosing. It was reasonable for Harris to stop his search once the order was cross-appealed and for him to continue his search only when the respondent's request for a stay of the order was denied. I do not therefore agree with appellant's counsel that the respondent was aware of the extent of the problem at the time of the hearing on May 28, 1996.

iii) Irreparable Harm

79 I have previously considered the importance of the system of advance rulings both to the taxpayer and Revenue Canada. It is a process that ought not be disturbed. The confidentiality of taxpayers using the process must be retained for the system to function.

80 I have reviewed the law concerning a stay or suspension of an appealed order when I denied the Minister's original request for a stay. (These reasons are attached as Schedule “A” to these reasons.)

81 The respondent has submitted that unless the stay is granted, the disclosure of taxpayers' identities in the documents ordered to be produced would cause irreparable harm to the Minister and to those taxpayers who are not parties to the present appeal.

82 Counsel for the appellant referred to the Supreme Court decision in RJR - MacDonald Inc. v. Canada (Attorney General), [1994] 1 S.C.R. 311 (S.C.C.). Sopinka and Cory JJ. stated at page 334 that in considering an application for either a stay or an interlocutory judgment, one of the facts to be considered is whether the applicant would suffer irreparable harm if the application were refused. The two other factors to consider, as set out in Metropolitan Stores (MTS) Ltd. v. Manitoba Food & Commercial Workers, Local 832, [1987] 1 S.C.R. 110 (S.C.C.), as cited by Sopinka and Cory JJ., are that firstly, a preliminary assessment must be made of the merits of the case to ensure there is a serious question to be tried and finally, an assessment must be made as to which of the parties would suffer greater harm from the granting or refusing of the remedy pending a decision on the merits. At page 344 Sopinka and Cory JJ. state that:

...Each party is entitled to make the court aware of the damage it might suffer prior to the decision on the merits. In addition, either the applicant or the respondent may tip the scales of convenience in its favour by demonstrating to the court a compelling public interest in the granting or refusal of the relief sought. “Public interest” includes both the concerns of society generally and the particular interests of identifiable groups.

83 Counsel for the respondent submitted that harm in the risk of disclosure of confidential taxpayer information in advance rulings requested by persons not party to litigation is greater than any harm flowing from the delay in production until the appeal and cross-appeal have been heard by the Court of Appeal. The harm would be both to the advance rulings process which benefits taxpayers generally and the tax administration and to the persons to whom 93 specific documents relate.

84 Counsel for the appellant argued that in his affidavit Hiltz simply states there would be harm to the advance rulings process as a whole. The evidence refers to harm to the Crown but the motion claims harm to the taxpayers.

85 I shall stay neither the order of June 27, 1996 nor the amended order. In my reasons for my previous order, attached as Schedule “A” to these reasons, I set out why I rejected the first request by the respondent for the stay of the order. In my view, the evidence has not convinced me that I should order a stay at this time. The order of June 27, 1996 sought to be stayed will be amended. The identities of the taxpayers will be protected. This should protect the interests of those taxpayers and reduce significantly the risk, if such risk exists, of irreparable harm to them and the Crown.

C. By the appellant for an order allowing the appeal.

86 The appellant moved for an order that its appeal be allowed. The appellant argues that the original request for copies of advance rulings was made by the appellant's counsel to the Crown's counsel by letter dated March 12, 1996. A motion to force disclosure was heard on May 28, 1996 and an order for disclosure was dated June 27, 1996. When the Crown applied for stay of the June 27th order on September 4, 1996, two months had passed since the order of September 11th had been issued. At time of the hearing of this motion five months had passed since the order and the Crown had still not complied with the original order to produce. On September 26, 1996 I ordered that disclosure be made by October 16, 1996.

87 During his submissions, I advised the appellant's counsel that based on the evidence before me it was not my intention to allow the appellant's motion to allow the appeal. I informed counsel that the Crown, in not complying with the order, was not displaying, to use a current expression, an “...in your face” attitude to the appellant. Officials of the Minister had a valid concern that compliance with the order of June 27, 1996 may force them to surrender “taxpayer information” within the meaning of subsection 241(10) of the Act. The Crown was of the view that my wording of the order, referring to “names” of taxpayers rather than their “identities” may not suffice to preserve confidentiality. This was always the concern of Messers. Hiltz and Harris. It is for that reason that the Crown wished the order of June 27th stayed and when the officials realized the extent of the number of taxpayers so affected, a second application to stay was made. This is not a situation similar to that in Mehr v. R., [1996] 2 C.T.C. 2249 (T.C.C.), where the taxpayer was cavalier in ignoring a Court order. Here, officials of Revenue Canada were legitimately concerned that the identities of taxpayers would be made public, perhaps contrary to law. This concern is expressed in Hiltz's affidavit. The Crown, like a taxpayer, may lose an appeal before this Court for failure to obey an order, but the facts in this appeal do not warrant such egregious action.

88 Recently, Hugessen J.A.[FN13: <p><em>R. v. North Grant Landscaping</em>(Fed. C.A.)</p>] reminded litigants that:

[r]ules of procedure are not intended as traps for the unwary or to victimize those who make innocent mistakes which cause no harm. The power of the Court to relieve against default has for its purpose to allow parties to resolve the real issues between them on the merit and not on mere technical or procedural grounds.

89 All counsel should take cognizance of this statement.

90 The appellant's motion will be dismissed, but it will be entitled to its costs of the motion. The appellant's motion was precipitated, in part, by events beyond its control.

91 The costs of the respondent's motions will be in its cause.

Addendum

While these reasons and the attached order were awaiting my signature Mr. Bourgard, counsel for the respondent, and Mr. Nitikman, counsel for the respondent, sent letters, dated January 17, 1997, to the Registrar of the Court. The letters concern the respondent's motion of November 21, 1996 for a stay of that part of my order of June 27, 1996 in which I directed the respondent to file and serve on the appellant a list of documents containing a description of any Advance Rulings and Technical Interpretations. One ground for the motion was that the extent to which there would be disclosure of taxpayers' identities in the Advance Rulings and Technical Interpretations ordered to be produced was not known until after September 13, 1996 and would cause irreparable harm to the respondent and to those taxpayers whose identities may be disclosed and who are not parties to this appeal.

Mr. Bourgard now understands that by the week of July 15, 1996, Revenue Canada officials working to meet the requirements of the June 27th order appreciated that in some cases a mere erasure or obliteration of some taxpayers' names would not protect their identities and the officials had concerns regarding a potential problem with respect to confidentiality. Mr. Bourgard added:

I should also draw to the Court's attention that it is now my understanding that on Sept. 3, 1996, just prior to the argument of the Motion for a stay that was heard in Vancouver on Sept. 4, 1996 Mr. Paris who argued the Motion on behalf of the Applicant/Respondent recollects that he and Mr. Taylor discussed whether the issue of confidentiality could be advanced as a ground of irreparable harm in support of the application for a stay. Mr. Taylor accepts Mr. Paris' recollection that the matter of confidentiality of the Rulings was discussed between them, but does not believe that the issue of confidentiality was first raised by him (Mr. Taylor). Mr. Taylor's continuing recollection is that prior to that conversation as far as he was concerned the only ground the Crown had upon which to argue the Stay Motion was that of the administrative burden of complying with the Order of June 27, 1996 at a time when that Order was subject to a cross-appeal to the Federal Court of Appeal.

Mr. Nitikman's comments were with respect to the last sentence in the passage of Mr. Bourgard's letter referred to above. Mr. Nitikman recalled that:

...Mr. Paris specifically raised the issue of confidentiality at the September 4 Stay Motion. Accordingly, although Mr. Taylor's memory is that prior to the September 3 conversation with Mr. Paris there was only one ground on which the Stay Motion could be argued, it is evident that his conversation with Mr. Paris changed that position because Mr. Paris advanced two grounds at the Stay Motion, the first being the administrative burden and the second being the matter of confidentiality.

Therefore, Mr. Nitikman submitted that:

...the revelation that the confidentiality issue was raised months before the November 21 motion and in fact months before the September 4 motion strongly indicates that as of November 21, 1996 the matter was res judicata as argued by the writer at the November 21 motion. We reiterate our submission that this matter could have and should have been raised either on the original May 15 Motion or the September 4 Motion and that as of November 21, 1996 the matter was res judicata in terms of varying the June 27 Order to protect confidentiality.

...on November 21 we made a Motion under Rule 91(c) to allow the Appeal on the ground that The Queen had failed to comply with your June 27 Order relating to the advance rulings. During the argument of that Motion Your Honour strongly indicated that you were not inclined to grant that Motion. It is our submission that the revelations contained in Mr. Bourgard's January 17, 1997 letter strongly support our Rule 91(c) Motion. This is not the first but indeed the second time that Revenue Canada has caused its solicitors to stand up before Your Honour and put forward statements and evidence which turn out not to be true (the first time being when Mr. Taylor indicated that they (sic) were no minutes of the GAAR Committee and later was forced to admit that his client had failed to give him certain minutes of the GAAR Committee).

Mr. Nitikman's position is that “Revenue Canada has a complete disregard for putting forward the truth when it matters. It is our submission that as compared to the facts in Bassermann and other cases[FN14: <p><em>Bassermann, supra, Doering, supra, Modlivco, supra.</em></p>] . which have allowed Appeals for failure to comply with court orders, this case stands on even stronger facts for...” a ruling allowing the appellant's appeal in accordance with Rule 91(c).

Mr. Bourgard replied as follows:

...The Respondent's Motion of November 13 in paragraph 6(i) was phrased“the extent to which there will be disclosure of taxpayer's identities in the Advance Rulings or Technical Bulletins was not known until after Sept. 13, 1996”. I explained to the Court on the argument of the Motion that on Sept. 13, 1996 all the documents which had been previously identified in the computer search of Mr. Harris were printed and the reading of the printed versions and classifying of them commenced. Since the argument of the Motion in Winnipeg officials at Revenue and we at the Department of Justice have continued to work on the file. As a result of that ongoing work I came to understand that the facts which I had put before the Court were incomplete as to point in time when it could be said that there was a first appreciation of an issue of confidentiality. I would not have wanted to leave the Court with the impression that the point in time at which the extent of the problem was known was also the point in time at which there was an appreciation that in some cases Revenue would not be able to protect the identity of some taxpayers. I was not kept in the dark by either Revenue or Mr. Taylor. Mr. Taylor accepts Mr. Paris' recollection of their discussion but he himself still does not recall the issue of confidentiality being raised between them.

I stated in my reasons for judgment that a judge of the Tax Court has the inherent power to amend an order when it does not express his or her manifest intention. I also wrote that the reason I ordered the names of taxpayers on copies of Advance Rulings and Technical Interpretations be erased or obliterated so that their identities would not be revealed.

Section 241 of the Income Tax Act provides for the confidentiality of taxpayer information. When I issued my order on June 27, 1996 I was of the view that a mere erasure or obliteration of names of taxpayers would satisfy this requirement. The issue of confidentiality was considered by me, although not argued before me. Unfortunately the method I selected to protect the identity of the taxpayers, in the view of the respondent, fails to serve the purpose intended. Based on the affidavits of Messrs. Harris and Hiltz, the respondent is probably correct in her view.

Nothing in counsels' letters compels me to alter my proposed order and reasons. Mr. Bourgard wrote advising that certain facts he represented to the Court were wrong and he wished to set the record straight; I would expect no less from Mr. Bourgard. That officials of Revenue Canada contemplated or did not contemplate the issue of confidentiality before or after a particular date is not really the issue here. Section 241 was always present, whether or not confidentiality was pleaded or argued before June 27, 1996. I am bound by section 241 of the Act and I cannot refuse to apply it, even on grounds of equity; see Granger v. Canada (Employment & Immigration Commission), [1986] 3 F.C. 70 (Fed. C.A.)cited by Chevalier D.J. in Ludco Enterprises Ltd./Entreprises Ludco Ltée v. R. (1994), [1996] 3 C.T.C. 74 (Fed. C.A.)at p. 5317. The order of June 27th was an interlocutory order; in the circumstances of this matter, that order ought not be subject to the doctrine of res judicata[FN15: <p>See:<em>Ratich v. Hourston</em>(1986), 35 C.C.L.T. 267 (B.C. S.C.), at 304, 305,70 B.C.L.R. 200, p. 231 Southin J.</p>]

The amending order simply provides the means for officials of Revenue Canada to observe the principle of the original order of June 27, 1996, for the appellant to receive information which it believes it requires to prosecute its appeal and for the identities of other taxpayers not to be revealed.