Lazarescu (L.E.) v. Canada, [1995] 1 CTC 2313, [1995] DTC 348

Bowman J.T.C.C.:-These appeals were heard together on common evidence. The arguments presented by the appellants were essentially the same.

Ms. Byrne’s appeal was originally from assessments for 1989, 1991 and 1992. At the opening of trial she withdrew her appeal for 1989. Ms. Lazarescu’s appeal was from an assessment for 1991.

In both cases the issue is whether maintenance payments made to the appellants by their former spouses for the support of their children are properly included in the appellants’ income.

The appellants stated specifically that their challenge to the assessments was not based on any provision of the Canadian Charter of Rights and Freedoms. Rather, they relied upon a number of grounds unrelated to the Charter.

It was not contended that the maintenance payments did not fall within paragraph 56(l)(b) of the Income Tax Act, R.S.C. 1952, c. 148 (am. S.C. 1970-71-72, c. 63) (the "Act”) as amounts "received by [the appellants]...pursuant to a decree, order or judgment of a competent tribunal...as alimony or other allowance payable on a periodic basis for the maintenance of...children of the marriage...or that [the appellants] were living apart from and [were] separated from [their respective former spouses] who were required to make the payments] at the time the payments] were received and throughout the remainder of the year".

The argument was that the requirement under the Income Tax Act that women such as the appellants must include in income such maintenance payments received for the support of their children discriminates against women in contravention of the Declaration on the Elimination of Discrimination against Women, the Convention on the Elimination of All Forms of Discrimination against Women and the United Nations Declaration of the Rights of the Child.

The Federal Court of Appeal has recently rendered judgment in the case of Thibaudeau v. Canada, [1994] 2 C.T.C. 4, 94 D.T.C. 6230, and has held that paragraph 56(1 )(b) of the Income Tax Act violates Ms. Thibaudeau’s rights under the Charter. Since the decision of the Federal Court of Appeal is of general application, I am bound by it.

After the Thibaudeau decision was rendered by the Federal Court of Appeal, I invited the appellants and counsel for the respondent to make such further representations on the effect of Thibaudeau as they saw fit. I have not heard from the appellants, but counsel for the respondent replied and quite properly observed that the appellants had specifically declined to invoke the Charter and that in any event no notice of a constitutional question was given to the Attorney General of Canada or the provincial attorneys general under section 57 of the Federal Court Act.

I do not think that the appellants’ failure to raise the Charter is a sufficient reason for me to ignore a binding decision of the Federal Court of Appeal that has held the very section challenged by the appellants to be unconstitutional.

As to the failure to give notice of a constitutional issue under section 57 of the Federal Court Act, there are practical considerations to be taken into account. Although it is presumably the responsibility of the party raising a constitutional issue to give notice under that section, the practice has been, where a constitutional question is raised in a notice of appeal, for the registry of this court to give notice to the various attorneys general. It might be noted in passing that no provincial attorney general has ever intervened in this court where a provision of the Income Tax Act has been challenged under the Charter. The Attorney General of Canada is, of course, always represented. The usual result would undoubtedly ensue if notice under section 57 were given in this case. Moreover, it is questionable whether section 57 of the Federal Court Act is germane in any event. It is not I, but rather the Federal Court of Appeal, who have adjudged paragraph 56(1 )(b) to be invalid. I am merely applying the doctrine of stare decisis in following that court’s decision, as I must do.

Counsel for the respondent also asked that I postpone rendering judgment until the Thibaudeau case was heard and disposed of by the Supreme Court of Canada. I do not think in all the circumstances that I should defer rendering judgment. These cases were heard under the informal procedure of this Court which contemplates an expeditious disposition of appeals. At the present time, I do not know when the Supreme Court will finally dispose of Thibaudeau and it is unfair to the appellants to force them to wait indefinitely for a decision. If the respondent considers it important that the disposition of these cases be held in abeyance until the Supreme Court renders a decision in Thibaudeau, she can file a protective notice of appeal.

In the circumstances it is not necessary for me to deal with the other arguments advanced by the appellants beyond observing that conventions and declarations of the type relied upon by the appellants here, even though signed by Canada, do not, unless implemented by statute, have the force of law in Canada so as to override domestic legislation, although they may be useful guides to interpretation.

I think therefore that the appropriate course for me to follow is to allow the appeals on the basis of the Federal Court of Appeal decision in Thibaudeau.

Accordingly, the appeal of Ms. Lazarescu from her assessment for 1991 is allowed with costs, if any, and the assessment referred back to the Minister of National Revenue for reconsideration and reassessment to delete the sum of $3,775 included in her income under paragraph 56(1 )(b) of the Income Tax Act and the appeals of Ms. Byrne from assessments for 1991 and 1992 are allowed with costs, if any, and the assessments referred back to the Minister of National Revenue for reconsideration and reassessment to delete the amounts of $6,325 and $7,475 respectively included in her income for those years under paragraph 56(1)(b) on the basis that paragraph 56(1 )(b) violates the appellants’ rights under the Canadian Charter of Rights and Freedoms. Ms. Byrne’s appeal from an assessment for 1989 having been withdrawn, that appeal is dismissed.

Appeals allowed.