BETWEEN:
and
Docket: 2002-2807(CPP)
AND BETWEEN:
WILLIAM SHAWN DAVITT,
Appellant,
and
THE MINISTER OF NATIONAL REVENUE,
Respondent,
2003-283(CPP)
2003-284(EI)
2003-511(IT)G
AND BETWEEN:
WILLIAM SHAWN DAVITT,
Appellant,
and
THE MINISTER OF NATIONAL REVENUE,
and HER MAJESTY THE QUEEN,
Respondent.
____________________________________________________________________
Motions heard on June 15, 2006, at Toronto, Ontario,
By: The Honourable Justice M.A. Mogan
Appearances:
____________________________________________________________________
ORDER
Upon applications by the Appellant for certain Orders in the above matters setting aside the following Orders of this Court:
1. the Order of the Honourable Chief Justice Bowman, dated May 31, 2001, in the appeal of William Shawn Davitt, 2001-893(IT)G;
2. the Order of the Honourable Justice McArthur, dated June 18, 2003, in the appeal of William Shawn Davitt, 2002-2807(CPP); and
3. the Order of the Honourable Justice Little, dated February 9, 2004, in the appeals of William Shawn Davitt, No. 2003-283(CPP), 2003-284(EI) and 2003-511(IT)G.
And upon the Appellant seeking punitive damages of $10 million;
And upon the Appellant seeking an indemnity from counsel for the Respondent with respect to certain costs;
And upon reviewing the material filed by the parties;
And upon hearing the Appellant and counsel for the Respondent;
It is ordered that the applications are dismissed, with costs in the amount of $500.00 payable by the Appellant to the Respondent, and payable forthwith.
Signed at Ottawa, Canada, this 12th day of July, 2006.
"M.A. Mogan"
Citation: 2006TCC402
Date: 20060712
Docket: 2001-893(IT)G
BETWEEN:
WILLIAM SHAWN DAVITT,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent,
Docket: 2002-2807(CPP)
AND BETWEEN:
WILLIAM SHAWN DAVITT,
Appellant,
and
THE MINISTER OF NATIONAL REVENUE,
Respondent,
2003-283(CPP)
2003-284(EI)
2003-511(IT)G
AND BETWEEN:
WILLIAM SHAWN DAVITT,
Appellant,
and
THE MINISTER OF NATIONAL REVENUE,
and HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR ORDER
(Delivered orally from the bench
on June 15, 2006, at Toronto, Ontarioand
edited at Ottawa, Ontarioon July 12, 2006)
[1] I am going to dismiss your motions, Mr. Davitt. In the interest of being expeditious, I will attempt to dictate my reasons now, but I reserve the right to edit those reasons; and modify them; and perhaps expand them. It may be helpful for the parties if I state my position now. Then I will obtain a transcript of what I say and perhaps expand upon it.
[2] The Appellant, William Shawn Davitt, has come to the Court with two Notices of Motion. In the first, he seeks a number of orders which I will recite from the Notice:
(i) an order setting aside the May 31, 2001 judgment of Associate Chief Justice Bowman on the ground of fraud;
(ii) an order setting aside the June 18, 2003 judgment of Justice McArthur on the ground of fraud;
(iii) an order setting aside the February 9, 2004 judgment of Justice Little on the ground of fraud;
(iv) punitive damages of $10 million pursuant to section 24 of the Canadian Charter of Rights and Freedoms;
(v) such further and other remedies as the Appellant may advise and this Honourable Court may permit, and costs.
Then it says:
This motion is made pursuant to section 172 of the Tax Court of Canada Rules.
In substance, ignoring the request for punitive damages, the Appellant is seeking to set aside three orders made by Justices Bowman, McArthur and Little. Those orders, which are a matter of record, had the effect of striking out certain Notices of Appeal which the Appellant had filed in this Court.
[3] By the way, Associate Chief Justice Bowman's Order also granted the Respondent costs in the matter of the appeal for the 1998 taxation year. According to documents in the file, those costs have now been taxed at an amount of $1,475.70.
[4] In the second motion, an order is sought that:
Counsel for the Respondent, Ms. Jocelyn Espejo Clarke, indemnify the Appellant for all costs payable by the Appellant with respect to the above-noted file ...
That is File 2001-893, which is the file on which Associate Chief Justice Bowman issued his order with respect to the 1998 taxation year. I asked the Appellant during the course of his presentation if he had paid those costs, and he said no. That is confirmed by a statement in the written submission of counsel for the Respondent, who states that the Appellant has not yet paid the taxed costs. I will not grant an order for indemnity for two reasons: first, the costs have not been paid by Mr. Davitt. Second, more substantively, I see no grounds on which counsel for the Respondent should be made personally liable for indemnifying the Appellant for costs because, in accordance with her obligation as a lawyer at the Department of Justice, she has sought to recover the costs awarded by Associate Chief Justice Bowman in his order of May 31, 2001.
[5] It has been a long time between the order made by Associate Chief Justice Bowman and the taxation of costs which occurred in the early months of 2006. I do not know the reasons for the delay but certainly the Appellant has had adequate time to pay the costs.
[6] The motion for indemnity from Ms. Clarke is dismissed.
[7] The other motion to set aside the judgments of Justices Bowman, McArthur and Little is based on fraud. The Appellant brought to the Court today many binders of documents which he wanted to submit to the Court in support of his allegation that there was fraud. There were 17 binders he had ready to submit. After a brief discussion with the Appellant, he stated that those 17 binders of documents related mainly to the public accounts of the Government of Canada, the public accounts of the Government of Nova Scotia, certain statements in reports by the Auditor General of Canada, financial statements of the Atomic Energy Company of Canada, and financial statements of other corporations. After hearing the Appellant and counsel for the Respondent, I decided not to accept the 17 binders on the basis that they were not relevant.
[8] The motion to set aside a judgment or order based on fraud must pertain to the manner in which the judge was deceived by the opposing party into granting the judgment or order which, if the judge had not been deceived, would not have been granted.
[9] All of the allegations of fraud which the Appellant brings to the Court are, first of all, no more than allegations; they are not proven. They relate to what I would call general public accounts, whether more money was collected to fund employment insurance than may have been necessary with respect to the claims against the employment insurance fund; whether the personal allowance permitted to each taxpayer in 1998 (around $7,000) was adequate having regard to the fact that in some provinces at that time earnings could not be garnisheed as a result of civil litigation if those earnings were below the level of $10,000 or $11,000.
[10] There may have been a significant difference between the personal allowance amount in the Income Tax Act and the amount in a given province which was exempt from garnishment in civil litigation proceedings but, in my view, making any adjustment for that kind of difference is not in the jurisdiction of the Tax Court of Canada. Those amounts (like the personal allowance in the Income Tax Act, and the low threshold of income free from garnishment) are determined by passing laws in the Parliament of Canada or the legislatures of the provinces. That is where such amounts are discussed, debated and ultimately settled with legislation.
[11] If the Appellant is right in maintaining that the Canada Pension Plan rates are too high, that the Plan is too well-funded, that the excess goes into the general federal revenue; or if he is right that employment insurance rates are too high and he ought not to have paid as much as he paid in the years 1998 or 1999 or 2000; whether such rates are too high or not is an issue that, again, is beyond the jurisdiction of this Court. Those rates are set in public debates in Parliament depending on the particular legislation. There are parliamentary committee hearings where different interest groups, and different political parties make their position known. I conclude the Tax Court of Canada has no jurisdiction to interfere with that kind of legislation.
[12] The Appellant goes a step further, however, and claims that under the Charter of Rights and Freedoms he has been discriminated against vis-à-vis other income groups in Canada or other groups under the Canada Pension Plan which might pay different premiums in different circumstances. I asked him in the course of his presentation if he had any quarrel with the actual amounts of his income determined in the respective years by the Government of Canada through either the revenue department or the employment insurance scheme or the Canada Pension Plan. He said no, he had no quarrel with the fact that his income had been accurately determined.
[13] I asked the Appellant if he had any question as to whether, once his income and taxable income were determined, the rates which were applied to him were the prevailing rates in the relevant legislation, whether it was the Income Tax Act, the Canada Pension Plan or the Employment Insurance scheme. He said no, he did not question that the prevailing rates which would apply to people at his level of income he thinks were applied to him the same as with all other people at that level. The Appellant's position is that there has been so much fraud in certain areas of government that the rates (Income Tax Act, Canada Pension Plan or Employment Insurance) would be different or should be different if such fraud were to be recognized. That is really the fraud he is talking about.
[14] Having listened to the Appellant at length, I find that he has not established or even alleged the kind of fraud which is necessary to set aside a judgment. That is to say, I have not been satisfied that Associate Chief Justice Bowman (as he then was) or Justice McArthur or Justice Little was deceived on a fraudulent basis with respect to any facts presented to those judges when they heard earlier motions to strike out the Appellant's pleadings. Fraud is based primarily on fact; it is not an issue of law. The facts have to pertain to an individual taxpayer relating to his or her particular circumstances within a taxation year, or within some fiscal period that is determined for purposes of employment insurance or the Canada Pension Plan.
[15] The Appellant's argument that he should be permitted to make claims under the Charter as to the unfairness of the rates in the Income Tax Act, the Canada Pension Plan and the Employment Insurance scheme because, under the Charter, they are not fair or equitable to all citizens is beyond the jurisdiction of this Court.
[16] There are circumstances where a claim under the Charter is not beyond the jurisdiction of this Court as, for example (and the Appellant cited this case) the appeal of O'Neill Motors Ltd. v. The Queen, 96 DTC 1486, where it was found that certain documents were seized by Revenue Canada under a provision of the Income Tax Act. That provision violated the Charter and, therefore, the documents seized could not be used to raise an assessment. On an appeal to this Court, because the section of the Act had been struck down as being in violation of the Charter, this Court vacated an assessment because it was based on documents improperly seized.
[17] That is the kind of circumstance where any judge in this Court may hear a Charter argument and grant relief based on the Charter. But the facts must relate to and be peculiar to the taxpayer himself. In O'Neill Motors, it was the taxpayer's documents which were seized illegally. Similarly, counsel for the Respondent referred to a case where a male taxpayer raised a Charter argument as to whether he should be prejudiced by a presumption in the Income Tax Act that the primary caregiver of a particular child was the mother and not the father. The male taxpayer came to this Court on a Charter argument that he was discriminated against under section 15 because, on a gender basis, there should not have been a presumption running in favour of the mother as opposed to the father to determine who the primary caregiver was. That may be a valid Charter argument and can be heard in this Court, but it pertains to the particular circumstances of a male Appellant who claims that a statutory presumption running in favour of his former wife or partner on a gender basis violates the Charter.
[18] Those are the kinds of Charter arguments we hear in this Court and have jurisdiction to hear because they go to the particular circumstances of a taxpayer. The problem the Appellant faces in these motions is that his Charter arguments do not go to his personal circumstances in a particular year. They go to what I would call class arguments. He, as having a particular income level, in a particular year, claims that it is not fair to tax him on a certain basis in relation to other matters. He drew my attention to paragraphs 91, 92, 93 and 94 of his Notice of Appeal which were struck out by Associate Chief Justice Bowman. Within his age group, he claims that he should not have to pay taxes with respect to certain undisclosed liabilities of the Government of Canada.
[19] If there were any validity to that kind of argument, there is no way a judge in this Court can grant relief to the Appellant without striking down the whole legislation as it applies to all taxpayers in Canada. The Appellant has failed to establish any fraud in the manner in which the three judges of this Court arrived at their respective decisions to grant orders quashing his appeals or striking them out.
[20] I have dealt with the Notices of Motion as if they had merit, as fresh notices to this Court; but over and above dealing with them on their merits, there is in my view an overarching reason why the motions should be dismissed. If the orders of those three judges are to be set aside, the Appellant should have taken them to the Federal Court of Appeal. In each case, the order of Associate Justice Bowman, Justice McArthur and Justice Little terminated the Appellant's rights in the sense that the particular order either struck out his entire Notice of Appeal or quashed the appeal. Because those orders terminated the Appellant's opportunity for relief before this Court, I understand the Appellant could have appealed to the Federal Court of Appeal and sought relief in the higher court to show that the orders ought not to have been granted. For whatever reason, the Appellant in his oral presentation today referred to his impecuniosity as one of the basic reasons, he did not pursue that avenue.
[21] The Appellant now comes back, approximately five years after Associate Chief Justice Bowman's order of May 31, 2001, and asks that it be set aside. First, he should have gone to the Federal Court of Appeal. Second the delay is unpardonable in terms of asking that the order be set aside. And third, on the merits, he has not demonstrated that any fraud was perpetrated on Associate Chief Justice Bowman in May 2001. I could say the same about the order issued by Justice McArthur in 2003 and the order issued by Justice Little in 2004. It is three years since Justice McArthur's order of June 18, 2003 and it is more than two years since Justice Little's order of February 9, 2004.
[22] The Appellant is way out of time at this point in trying to set aside those orders. If they were issued on the basis of fraud, as he claims, the fraud should have been so egregious in his mind that he ought to have sought relief within the prescribed time for appealing from such orders. He did not seek that relief within such time.
[23] Notwithstanding these latter positions, I have attempted to consider and hear his arguments on the merits of his case. But to come back to my primary position, the motions fail because of the Appellant's failure to demonstrate any fraud perpetrated on this Court and the particular justices involved when the orders were granted in 2001, 2003 and 2004.
[24] For these reasons, the motions are dismissed: the motions to set aside, the motion for $10 million in punitive damages, and the motion for indemnity. I award costs of $500 to the Respondent payable by the Appellant forthwith.
Signed at Ottawa, Canada, this 12th day of July 2006.
''M.A. Mogan"
Mogan D.J.
COURT FILE NO.: 2001-893(IT)G, 2002-2807(CPP),
2003-283(CPP), 2003-284(EI),
2003-511(IT)G
STYLE OF CAUSE: WILLIAM SHAWN DAVITT AND HER MAJESTY THE QUEEN
PLACE OF HEARING: Toronto, Ontario
DATE OF HEARING: June 15, 2006
REASONS FOR ORDER BY: The Honourable Justice M.A. Mogan
APPEARANCES:
|
For the Appellant: |
The Appellant himself |
|
Counsel for the Respondent: |
Jocelyn Espejo Clarke |
COUNSEL OF RECORD:
Firm: N/A
For the Respondent: John H. Sims, Q.C.
Deputy Attorney General of Canada
Ottawa, Canada