Misfeasance

A CRA employee for a time accessed various taxpayers' records out of curiosity (a practice for which he was dismissed.) He did not especially target the taxpayer, did not remember specifically doing so and, in any event, did not retain any information he may have learned, or disseminate it. As he was not aware that his conduct was likely to harm her (and he did not act with the express purpose of harming her), the tort of misfeasance in public office was not made out (para. 54).

After quoting (at para. 123) from an extensive discussion in Odhavji Estate v. Woodhouse, 2003 SCC 69, of the tort of misfeasance in public office, Barnes J concluded (at para. 136) that "the CRA's conduct was fair, responsible and reasonable throughout."

A Revenu Québec auditor (who was under a quota for producing $1,000 per hour of recoveries) generated false and fictitious entires in the taxpayer`s records in order to make it appear that the taxpayer had claimed false expenses, with the result that the taxpayer was reasessed for additional tax, interest and penalties of over $450,000. Revenu Québec's collection department then made a seizure under the taxpayer's line of credit even though it was known that the excesssive reassessments would be reversed. The taxpayer ceased activities.

The court awarded $1.1 million in damages to the taxpayer's shareholder (including $1 million in punitive damages) and $2.75 million to the taxpayer (including $1 million in punitive damages and $350,000 in legal costs). The punitve damages awards were grounded on there being "unlawful and intentional interference" under the Quebec Charter of Human Rights and Freedoms.