Canada (Minister of Customs and Excise) v. Slalom Sports Canada Ltd., (1986) 5 F.T.R. 269 (TD)

• Judge: Teitelbaum, J.
• Court: Federal Court (Canada)
• Case Date: April 15, 1986
• Jurisdiction: Canada (Federal)
• Citations: (1986), 5 F.T.R. 269 (TD)

Can. v. Slalom Sports Can. Ltd. (1986), 5 F.T.R. 269 (TD)

MLB headnote and full text

Canada (Minister of Customs and Excise) v. Slalom Sports Canada Ltd.

(T-3066-83)

Indexed As: Canada (Minister of Customs and Excise) v. Slalom Sports Canada Ltd.

Federal Court of Canada

Trial Division

Teitelbaum, J.

April 23, 1986.

Summary:

The Minister of Customs and Excise brought an action against Slalom Sports Canada for $337,674.64 allegedly owing in customs duties and penalties because of an alleged underestimation of the value for duty of goods imported from the United States by Slalom. Slalom counterclaimed for a repayment of money paid "under protest" to the Minister in order to obtain the release of the seized goods.

The Federal Court of Canada, Trial Division, allowed the Minister's action, and dismissed the counterclaim.

Customs - Topic 6223

Payment of duty - Valuation for duty - "Purchaser in Canada" defined - A Canadian "subsidiary" imported goods into Canada from its American parent company - The goods were either manufactured or imported by the parent company and sold by the subsidiary in Canada - No documents respecting the subsidiary were present in Canada - All services performed for the subsidiary were performed in the United States - The financial statements of the subsidiary were addressed to the American company - The Federal Court of Canada, Trial Division, held that this and other evidence proved that the subsidiary was only a distribution centre or sales agency for the American parent company, and not a "purchaser" within the meaning of s. 41(1) of the Customs Act - The true purchasers were the customers to whom the goods were finally shipped in Canada - See paragraphs 25 to 45, 56.

Customs - Topic 6227

Payment of duty - Valuation for duty - Sale prices to purchaser - A Canadian "subsidiary" imported goods into Canada from its American parent company, for sale to purchasers in Canada - The subsidiary was only the distribution centre for the imported goods - The Federal Court of Canada, Trial Division, held that under s. 41(1) of the Customs Act, the value of the goods for duty was the sale price to the subsidiary's customers in Canada.

Customs - Topic 8323

Offences and penalties - Evidence - Presumption of fraud - Rebuttal of presumption - An importer of goods into Canada adopted a practice of double invoicing, thereby raising the presumption of fraud in s. 247 of the Customs Act - The importer merely stated that "he did not know of the double invoicing" - The Federal Court of Canada, Trial Division, held that the importer did not establish lack of blameworthy conduct sufficient to rebut the presumption - See paragraphs 57 to 64.

Statutes - Topic 1608

Interpretation - Extrinsic aids - Administrative policy - The Federal Court of Canada, Trial Division, held that guidelines or memorandums established by the Minister of Revenue may be used as an aid in interpreting the Customs Act, s. 41(1) - See paragraphs 23 to 24.

Cases Noticed:

Canada (Minister of Customs and Excise) v. Jay Norris Canada Inc., (1986), 1 F.T.R. 149 (F.C.T.D.), refd to. [para. 64].

Statutes Noticed:

Customs Act, R.S.C. 1970, c. C-40, sect. 41(1) [paras. 21-22]; sect. 247 [paras. 57-58]; sect. 248 [para. 60].

Counsel:

S.A. Barry, for the plaintiff;

G. Dumas and D. Campbell, for the defendant.

Solicitors of Record:

Frank Iacobucci, Q.C., Deputy Attorney General of Canada, for the plaintiff;

Hackett, Campbell, Bouchard, Sherbrooke, Quebec, for the defendant.

This action was heard before Teitelbaum, J., of the Federal Court of Canada, Trial Division, at Montreal, Quèbec, on April 15, 1986. The decision of Teitelbaum, J., was delivered on April 23, 1986.