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Docket: 2000-4697(IT)G |
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BETWEEN: |
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ANDRE TREMBLAY, |
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Appellant, |
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and |
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HER MAJESTY THE QUEEN, |
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Respondent. |
____________________________________________________________________
Appeals heard on September 25, 2003 at Victoria, British Columbia
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Before: The Honourable Justice R.D. Bell |
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Appearances: |
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For the Appellant: |
The Appellant himself |
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Counsel for the Respondent: |
Lynn M. Burch |
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JUDGMENT
The appeals from the reassessments made under the Income Tax Act for the 1991, 1992, 1993, 1994, 1995, 1996, 1997 and 1998 taxation years are dismissed in accordance with the attached Reasons for Judgment.
Signed at Ottawa, Canada this 10th day of October, 2003.
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"R.D. Bell" |
J.T.C.C.
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Citation:2003TCC703 |
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Date: 20031010 |
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Docket: 2000-4697(IT)G |
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BETWEEN: |
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ANDRE TREMBLAY, |
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Appellant, |
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and |
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HER MAJESTY THE QUEEN, |
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Respondent. |
REASONS FOR JUDGMENT
Bell, J.
[1] The Respondent filed a Notice of Motion with the Court on September 23, 2003 returnable on September 25, 2003 and served the Appellant by leaving a copy thereof and attached documents, in a sealed envelope, in his mailbox at 3:05 p.m. at 3807-5th Avenue, Port Alberni, British Columbia.
[2] When the Court advised the Respondent's counsel that she had had ample time to file a motion with the appropriate notice she responded that the Appellant was not prejudiced by this motion. The Appellant stated, before he was sworn, that he had not received the served copy of the Notice of Motion.
[3] The motion was for an Order that the appeals be dismissed pursuant to the provisions of Rule 116(4) of the Tax Court of Canada Rules (General Procedure). The ground for the motion was that the Appellant failed to respond to questions on written examination for discovery by affidavit in Form 114 either within 30 days as provided in the said Tax Court Rules, or at any time.
[4] A copy of the affidavit of Karen A. Truscott, counsel in the Tax Law Services Section of the Department of Justice in Vancouver, British Columbia reads as follows:
I, Karen A. Truscott, of the City of Vancouver, in the Province of British Columbia, MAKE OATH AND SAY AS FOLLOWS:
1. I am employed as counsel, in the Tax Law Services Section of the Department of Justice (the "Department") in Vancouver, British Columbia and as such have personal knowledge of the matters hereinafter deposed to, save and except what is stated to be on information and belief, and where so stated, I verily believe them to be true.
2. Attached as Exhibits A and B respectively are copies of the Notice of Appeal and Reply to the Notice of Appeal filed in these proceedings.
3. Attached as Exhibits C and D are copies of the Appellant's List of Documents and the Respondent's List of Documents.
4. I have reviewed the Department's files and am also informed by Ms. Lynn Burch, counsel in the Tax Law Services Section of the Department of Justice, Vancouver, British Columbia, having conduct of this appeal, and do verily believe that on February 6, 2003 Ms. Burch served on the Appellant's then counsel, Mr. George Jones, questions on written examination for discovery together with copies of the documents comprising the Respondent's List of Documents. A copy of Ms. Burch's letter and the questions on written examination for discovery are attached as Exhibit E.
5. I am informed by Ms. Burch and do verily believe that the Appellant did not answer the questions on written examination for discovery in Form 114 as prescribed by the Tax Court of Canada Rules (General Procedure) either within the thirty days of the questions being served on his counsel or at any other time. Counsel for the Appellant did provide a letter dated March 6, 2003 on a "without prejudice" basis. A copy of that letter is attached as Exhibit F.
6. I am informed by Ms Burch and do verily believe that the Appellant, his counsel and Ms. Burch attended a pre-trial conference before Mr. Justice Beaubier, in Victoria, British Columbia on April 3, 2003. A copy of the pre-trial brief is attached as Exhibit G.
7. I am informed by Ms. Burch and do verily believe that the pre-trial conference was unsuccessful in defining or resolving any of the matters at issue in this appeal.
8. On June 4, 2003 Mr. Jones made a motion to be removed as solicitor of record which motion attached a letter of that same date addressed to Mr. Justice Beaubier. A copy of the Notice of Motion and letter are attached as Exhibit H.
9. I am informed by Ms. Burch and do verily believe that Mr. Jones' motion to be relieved as solicitor of record was heard by teleconference call on June 27, 2003 which motion was unopposed by the Respondent and granted by Mr. Justice Beaubier. A copy of the Reasons for Order and Order are attached as Exhibit I.
10. I make this Affidavit in support of the Respondent's motion that the appeal be dismissed pursuant to Rule 116(4) of the Tax Court of Canada Rules (General Procedure).
[5] Exhibit E to Karen Truscott's affidavit is reproduced, in pertinent part, as follows:
QUESTIONS ON WRITTEN EXAMINATION
FOR DISCOVERY
The Respondent has chosen and the Appellant has consented that the Appellant shall be examined for discovery by written questions. The Respondent requires that the following questions b answered by affidavit in Form 114 prescribed the Tax Court of Canada Rules (General Procedure), and served within thirty days after service of these questions.
1. Do you agree that the assessment for your 1998 taxation year, dated September 14, 2000 (see item 42, Respondent's List of Documents) is a nil assessment (ie. it is not an assessment of tax but is a notification that no tax was payable).
2. If you don't agree, why not?
3. You agree with the facts set out at paragraphs 8(b), (c) and (d) of the Reply?
4. If not, state fully the facts which contradict those pleaded facts.
5. Do you agree that the Minister of National Revenue properly included the amounts set out at paragraphs 8(e) of the Reply in your income for the years stated there?
6. If not, why not?
7. Did you claim certain pension and investment income that was properly yours as income of your brother Marquis Tremblay as set out at paragraph 8(e)(i) and (ii)?
8. The documents at Tabs 60, 61, 4, 7, 9 and 62 are tax returns for 1991, 1992, 1993, 1994, 1995 and 1996 that you filed under your brother's name?
9. You signed Marquis Tremblay's name to each of those returns, correct?
10. Has Marquis Tremblay has been deceased since 1935?
11. You agree with the facts stated at paragraphs 8(f), (g), (h), (i), (j), (k), (m), (n), (o) and (p) of the Reply to Notice of Appeal?
12. If not, state fully the facts which contradict those pleaded facts.
13. You did not appeal the decision of the Supreme Court of British Columbia ordering repayment to Shipp?
14. You did not appeal the fraud conviction?
15. You did not appeal your conviction in the 1999 tax prosecution?
16. If any of those matters were appealed, please provide details as to their resolution.
17. Further to an Order of the Supreme Court of British Columbia in respect of the civil suit brought against you by Frederick Shipp ("Shipp") you repaid $794,899 to Shipp in your 1998 taxation year.
18. If you disagree with this statement, fully state why.
19. You agree that the September 14, 2000 Reassessments allowed you to carry the non-capital loss generated by the repayment to your 1995, 1996, 1997 taxation years as set out in Schedule 1 of the Reply?
20. On what facts do you rely in support of the position taken in the Notice of Appeal that you should be allowed to carry back the non-capital loss generated by the 1998 repayment to your 1994 taxation year?
21. Is it your position that you should be allowed to carry back the non-capital loss generated by the 1998 repayment to your 1991, 1992 or 1993 taxation years?
22. If so, what facts do you rely on in support of that position?
23. What is the exact amount of "large legal expenses" and "full legal expenses" referred to at paragraphs B.1 and C.3 of the Notice of Appeal?
24. What are the legal expenses comprised of?
25. Do the legal expenses cover both the civil Shipp action and the two prosecutions?
26. When were the legal expenses incurred?
27. Who was your legal representative in each of those matters?
28. How did your legal representatives in those matters invoice you?
29. Please provide copies of all documents indicating the legal expenses you incurred in defense of the Shipp action and the two prosecutions that you believe should be allowed to you as a deduction.
30. Did you pay legal fees?
31. If so, what was the manner of payment?
32. When were the payments made? Provide copies of any and all documents showing payment.
[6] Respondent's counsel, Lynn Burch, informed the Court that it was impossible, without answers to those questions, to determine the issues in this appeal. She referred to the portion of the Notice of Appeal entitled "C. ISSUES TO BE DECIDED" which reads as follows:
1. Whether indeed the Appellant should have certain sums received from Fred Shipp included in his income in 1994.
2. Whether all monies paid to Fred Shipp's Estate in later years should be credited to the Appellant.
3. Whether the full legal expenses incurred by the Appellant in defending the Shipp actions are deductible under the provisions of the Income Tax Act.
4. Whether the Appellant is entitled to carry back legal expenses and repayment amounts to the 1994 taxation year.
5. Whether the Appellant was guilty of gross negligence in order for penalties to be levied and applied against him.
[7] Counsel also informed the Court that the Appellant had been convicted, under the Criminal Code, of embezzling funds from Mr. Shipp ("Shipp") and sentenced to two years in prison. She stated further that the Appellant had been convicted of offenses under section 239 of the Income Tax Act ("Act") and had been ordered by the Supreme Court of British Columbia on June 26, 1998 to repay Shipp $830,620 in respect of the aforesaid defalcation.
[8] Counsel also described how amounts in respect of the defalcation were paid to Shipp by the Appellant and how such payments had been treated as deductions which were applied against his 1998 income and the income of 1997, 1996 and 1995 with the balance being carried forward for seven years. She also stated that one of the difficulties with the Appellant was that the loss could not be carried back, because of statutory limitation, to his 1994 taxation year. Respondent's counsel also advised the Court that when the case was initially set down for April 3, 2003 the hearing essentially became a pre-hearing conference with an attempt to settle the matter. Counsel advised that the Appellant would not accept a settlement satisfactory to the Respondent and to Appellant's counsel and that the case was adjourned to September 25, 2003.
[9] The Appellant denied ever discussing the written questions with his lawyer and denied having received them from such counsel on his resignation as counsel by order of this Court on June 27, 2003. This denial was made in spite of my assurance to him that his counsel, of outstanding reputation and competence, would have delivered all documents to him after his resignation.
[10] After the Court caused the Appellant to be sworn so that his subsequent statements would all be made under oath, in response to the Court's questions as to what evidence he would produce if the trial proceeded, he said that he would prove that he did not take the money from Shipp. He also referred to untrue statements made by Respondent's counsel.
[11] The impression made upon the Court by the Appellant is that he was untruthful, obstructive and, having ignored his responsibility to answer questions and define the issues, was wholly unprepared to proceed with the hearing of his appeal. This impression was buttressed by his extraordinary declaration that he was not guilty as convicted, blaming his lawyer for such result.
[12] It appears to the Court that this Appellant had no intention of preparing for the conduct of a reasonable hearing and because he denied the existence of proven facts, there was no point in proceeding with that hearing or adjourning it to another date.
[13] Rule 116(4) read as follows:
(4) Where a person refuses or fails to answer a proper question on a written examination or to produce a document which that person is required to produce, the Court may, in addition to imposing the sanctions provided in subsections (2) and (3),
(a) if the person is a party or a person examined on behalf of or in place of a party, dismiss the appeal or allow the appeal as the case may be,
(b) strike out all or part of the person's evidence, and
(c) give such other direction as is just.
[14] In light of the foregoing, I determined that the Appellant was not prejudiced by the short notice for the hearing of the motion and I abridged the time for serving the Notice of Motion under Rule 12 and dismissed the appeal under rule 116(4).
Signed at Ottawa, Canada this 10th day of October, 2003.
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"R.D. Bell" |
J.T.C.C.
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CITATION: |
2003TCC703 |
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COURT FILE NO.: |
2000-4697(IT)G |
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STYLE OF CAUSE: |
Andre Tremblay v. The Queen |
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PLACE OF HEARING: |
Victoria, British Columbia |
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DATE OF HEARING: |
September 25, 2003 |
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REASONS FOR JUDGMENT BY: |
The Honourable Justice R.D. Bell |
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DATE OF JUDGMENT: |
October 10, 2003 |
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APPEARANCES: |
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Counsel for the Appellant: |
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Counsel for the Respondent: |
Lynn M. Burch |
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COUNSEL OF RECORD: |
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For the Appellant: |
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Name: |
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Firm: |
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For the Respondent: |
Morris Rosenberg Deputy Attorney General of Canada Ottawa, Canada |