Forest Oil Corp. v. Minister of National Revenue, (1996) 126 F.T.R. 119 (TD)

• Judge: Gibson, J.
• Court: Federal Court (Canada)
• Case Date: November 27, 1996
• Jurisdiction: Canada (Federal)
• Citations: (1996), 126 F.T.R. 119 (TD)

Forest Oil Corp. v. MNR (1996), 126 F.T.R. 119 (TD)

MLB headnote and full text

Forest Oil Corporation (plaintiff) v. Her Majesty the Queen (defendant)

(T-3041-89)

Indexed As: Forest Oil Corp. v. Minister of National Revenue

Federal Court of Canada

Trial Division

Gibson, J.

November 27, 1996.

Summary:

Forest Oil overpaid $411,424.94 under the Petroleum and Gas Revenue Tax Act. Section 91(1) of the Act empowered the Minister to make a refund if the taxpayer filed a return within four years. No return was filed, even though the Minister requested one. The Minister's position was that there was no obligation or authority to issue a refund. Forest sued the federal Crown seeking, inter alia, a declaration of constructive trust on the basis of unjust enrichment. An enrichment and corresponding deprivation was conceded. The only issue was whether s. 91(1) provided a juristic reason for the enrichment.

The Federal Court of Canada, Trial Division, declared that the Crown held the monies upon a constructive trust based on unjust enrichment.

Mines and Minerals - Topic 9605

Taxation - Refunds - Forest Oil overpaid $411,424.94 under the Petroleum and Gas Revenue Tax Act - Section 91(1) of the Act empowered the Minister to make a refund if the taxpayer filed a return within four years - No return was filed, even though the Minister requested one - The Minister claimed that there was no obligation or authority to issue a refund - Forest sought a declaration of constructive trust on the basis of unjust enrichment - An enrichment and corresponding deprivation was conceded - At issue was whether s. 91(1) was a juristic reason for the enrichment - The Federal Court of Canada, Trial Division, declared that the Crown held the monies upon a constructive trust based on unjust enrichment - Although s. 91(1) was a complete code respecting the authority and obligation to make refunds, it was still open to find a constructive trust based on unjust enrichment - Where there existed no statutory provision clearly and unequivocally justifying the enrichment, the court found no juristic reason for the enrichment.

Mistake - Topic 1710

Recovery of money paid under mistake of law - Mistake of law - Circumstances when recovery allowed - [See Mines and Minerals - Topic 9605 ].

Restitution - Topic 64

Unjust enrichment - Juristic reason for enrichment - [See Mines and Minerals - Topic 9605 ].

Restitution - Topic 123

Unjust enrichment - Remedies - Constructive trust - [See Mines and Minerals - Topic 9605 ].

Trusts - Topic 2346

Constructive trusts - Basis for imposition - Unjust enrichment - [See Mines and Minerals - Topic 9605 ].

Cases Noticed:

Sorochan v. Sorochan, [1986] 2 S.C.R. 38; 69 N.R. 81; 74 A.R. 67; [1986] 5 W.W.R. 289; 2 R.F.L.(3d) 225; 46 Alta. L.R.(2d) 97, refd to. [para. 5].

Winnipeg (City) v. Morguard Properties Ltd. et al., [1983] 2 S.C.R. 493; 50 N.R. 264; 25 Man.R.(2d) 302, refd to. [para. 12].

Amoco Canada Petroleum Co. v. Minister of National Revenue (1985), 57 N.R. 274; 85 D.T.C. 5169 (F.C.A.), refd to. [para. 13].

Stubart Investments Ltd. v. Minister of National Revenue, [1984] 1 S.C.R. 536; 53 N.R. 241, refd to. [para. 14].

Lor-Wes Contracting Ltd. v. Minister of National Revenue, [1986] 1 F.C. 346; 60 N.R. 321 (F.C.A.), refd to. [para. 14].

Air Canada and Pacific Western Airlines Ltd. v. British Columbia, [1989] 1 S.C.R. 1161; 95 N.R. 1, refd to. [para. 17].

Consumers Glass Co. v. Canada, [1988] 2 C.T.C. 141; 21 F.T.R. 131 (T.D.), revd. (1990), 107 N.R. 156 (F.C.A.), refd to. [paras. 18, 19].

Minister of National Revenue v. Union Gas Ltd. (1990), 116 N.R. 220; 90 D.T.C. 6659 (F.C.A.), refd to. [para. 20].

Statutes Noticed:

Petroleum and Gas Revenue Tax Act, S.C. 1980-81-82-83, c. 68, sect. 91(1) [para. 6].

Counsel:

Al Meghji, for the plaintiff;

Bonnie Moon, for the defendant.

Solicitors of Record:

Bennett Jones Verchere, Calgary, Alberta, for the plaintiff;

George Thomson, Deputy Attorney General of Canada, Ottawa, Ontario, for the defendant.

This motion was dealt with in writing without the appearance of parties by Gibson, J., of the Federal Court of Canada, Trial Division, who delivered the following judgment on November 27, 1996.