Cheder Chabad v. Minister of National Revenue, (2013) 456 N.R. 158 (FCA)

• Judge: Mainville, J.A.
• Court: Federal Court of Appeal (Canada)
• Case Date: August 21, 2013
• Jurisdiction: Canada (Federal)
• Citations: (2013), 456 N.R. 158 (FCA);2013 FCA 196

Cheder Chabad v. MNR (2013), 456 N.R. 158 (FCA)

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[French language version follows English language version]

[La version française vient à la suite de la version anglaise]

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Temp. Cite: [2013] N.R. TBEd. MR.022

Cheder Chabad (applicant) v. Minister of National Revenue (respondent)

(A-276-13; 2013 FCA 196; 2013 CAF 196)

Indexed As: Cheder Chabad v. Minister of National Revenue

Federal Court of Appeal

Mainville, J.A.

August 23, 2013.

Summary:

The applicant was a registered charity under the Income Tax Act. The Canada Revenue Agency (CRA) determined that the applicant failed to comply with the requirements on a registered charity, and as a result, the Minister of National Revenue proposed, under s. 168(1) of the Act, to revoke the applicant's registration as a charity. The applicant applied for an order prohibiting the Minister from giving effect to that proposal by publishing a copy of the notice in the Canada Gazette under s. 168(2).

The Federal Court of Appeal, per Mainville, J.A., ordered, under s. 168(2)(b) of the Act, that the period during which the Minister was precluded from publishing a copy of the notice proposing to revoke the applicant's registration in the Canada Gazette be extended, on a one-time basis, to December 31, 2013.

Income Tax - Topic 7533

Exemptions - Particular exemptions - Charitable organizations and foundations - The applicant was a registered charity under the Income Tax Act and operated a school for boys - The Canada Revenue Agency (CRA) determined that the applicant failed to comply with the requirements on a registered charity, and as a result, the Minister of National Revenue proposed, under s. 168(1) of the Act, to revoke the applicant's registration as a charity - The applicant applied for an order prohibiting the Minister from giving effect to that proposal by publishing a copy of the notice in the Canada Gazette under s. 168(2) - The Federal Court of Appeal, per Mainville, J.A., held that the applicable test was that set out in RJR-MacDonald Inc. et Imperial Tobacco Ltd. v. Canada (Procureur général) (SCC 1994) for the granting of a stay or an injunction - The Minster accepted that there was a serious issue to be determined from the applicant's notice of objection under s. 168(4) of the Act - The applicant had demonstrated, on a balance of probabilities, that the revocation of its registration would cause irreparable harm, where it might provoke the cancellation of the upcoming school year and the dismissal of the teachers and staff - Finally, the balance of convenience favoured granting the application in light of the interests of the school's 180 students - Further, the balance of convenience required that an orderly solution be crafted which took into account both the students interests as well as the general public interest in the integrity of the charitable sector - The court ordered, under s. 168(2)(b) of the Act, that the period during which the Minister was precluded from publishing a copy of the notice proposing to revoke the applicant's registration in the Canada Gazette be extended, on a one-time basis, to December 31, 2013.

Cases Noticed:

International Charity Association Network v. Minister of National Revenue (2008), 375 N.R. 383; 2008 FCA 62, refd to. [para. 10].

RJR-MacDonald Inc. et Imperial Tobacco Ltd. v. Canada (Procureur général), [1994] 1 S.C.R. 311; 164 N.R. 1, refd to. [para. 12].

International Charity Association Network v. Minister of National Revenue (2008), 375 N.R. 387; 2008 FCA 114, refd to. [para. 12].

Millenium Charitable Foundation v. Minister of National Revenue (2008), 384 N.R. 119; 2008 FCA 414, refd to. [para. 12].

Gateway City Church v. Minister of National Revenue (2013), 445 N.R. 360; 2013 FCA 126, refd to. [para. 16].

Choson Kallah Fund of Toronto v. Minister of National Revenue (2008), 383 N.R. 196; 2008 FCA 311, refd to. [para. 25].

Imperial Chemical Industries PLC et al. v. Apotex Inc., [1990] 1 F.C. 221; 101 N.R. 147 (F.C.A.), refd to. [para. 26].

Lassonde (A.) Inc. v. Island Oasis Canada Inc. et al., [2001] 2 F.C. 568; 273 N.R. 179 (F.C.A.), refd to. [para. 26].

Haché et al. v. Canada (Minister of Fisheries and Oceans) et al., [2006] N.R. Uned. 204; 2006 FCA 424, refd to. [para. 26].

Statutes Noticed:

Income Tax Act, R.S.C. 1985 (5th Supp.), c. 1, sect. 168 [para. 1 et seq.].

Counsel:

Adam Aptowitzer and Alexandra Tzannidakis, for the applicant;

Johanna Hill, for the respondent.

Solicitors of Record:

Drache Aptowitzer, Ottawa, Ontario, for the applicant;

William F. Pentney, Deputy Attorney General of Canada, Ottawa, Ontario, for the respondent.

This case was heard by telephone conference on August 21, 2013, by Mainville, J.A., of the Federal Court of Appeal, who delivered the following judgment at Ottawa, Ontario, on August 23, 2013.