Lalonde v. Canada Revenue Agency, (2008) 334 F.T.R. 97 (FC)

• Judge: Martineau, J.
• Court: Federal Court (Canada)
• Case Date: January 21, 2008
• Jurisdiction: Canada (Federal)
• Citations: (2008), 334 F.T.R. 97 (FC);2008 FC 183

Lalonde v. CRA (2008), 334 F.T.R. 97 (FC)

MLB headnote and full text

[French language version follows English language version]

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

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Temp. Cite: [2008] F.T.R. TBEd. MR.008

Marcel Lalonde (demandeur) v. Agence du Revenu du Canada (défenderesse)

(T-1200-07; 2008 CF 183; 2008 FC 183)

Indexed As: Lalonde v. Canada Revenue Agency

Federal Court

Martineau, J.

February 14, 2008.

Summary:

Lalonde applied for judicial review of a second level decision of a Canada Revenue Agency manager refusing to cancel all the interest that had accrued under reassessments of the 1992 and 1993 taxation years.

The Federal Court allowed the application and remitted the matter to the Agency so that a new decision could be made in light of these reasons.

Income Tax - Topic 7803

Returns - Assessments, payment and appeals - Interest - Waiver - In 1992 and 1993, Lalonde invested in a tax shelter, namely, flow-through shares in a mining company - In his 1992 and 1993 tax returns, he claimed tax deductions of $9,600 and $12,000 in connection with those shares - The Minister of National Revenue began an investigation of the company in 1996 - In 1997, the Minister issued reassessments for the 1992 and 1993 taxation years - Criminal charges were laid against the promoters of the company - Settlement of Lalonde's file was suspended administratively pending the outcome of the trial - In September 2000, Lalonde received notices of reassessment for 1992 and 1993 - The net federal tax payable was $7,603.36 for 1992 and $10,254.91 for 1993 - Lalonde made a "T1 adjustment request" for 1992 and 1993 and an "interest cancellation request" - In December 2001, he was directed to appeal the assessments to the Tax Court of Canada (which he did in 2002) and the requests were denied - The appeal was abandoned in June 2004 and the parties agreed to proceed administratively - In May 2007, the fairness request was processed at the second level and was denied - Lalonde applied for judicial review - The Federal Court allowed the application - In light of the evidence on file, the Minister had not provided a reasonable explanation for a large portion of the delays since December 15, 2001, and especially between June 2004 and May 2007 - Those delays were due mainly to the actions of the Minister or the Minister's representatives - Further, Lalonde did not seem to have been informed within a reasonable time that his file had been suspended pending decisions to be rendered shortly in "similar" cases.

Cases Noticed:

R. v. McKinlay Transport Ltd. and C.T. Transport Inc., [1990] 1 S.C.R. 627; 106 N.R. 385; 39 O.A.C. 385, refd to. [para. 7].

R. v. Adamson, 2002 DTC 1540, refd to. [para. 17].

R. v. Neathly, 2007 TCC 611, refd to. [para. 17].

Lanno v. Canada Customs and Revenue Agency (2005), 334 N.R. 348; 2005 FCA 153, refd to. [para. 54].

Comeau v. Canada Customs and Revenue Agency, [2004] F.T.R. Uned. A77; 2004 FC 961, affd. in part (2005), 361 N.R. 141; 2005 FCA 271, refd to. [para. 54].

Ryan v. Law Society of New Brunswick, [2003] 1 S.C.R. 247; 302 N.R. 1; 257 N.B.R.(2d) 207; 674 A.P.R. 207, refd to. [para. 55].

Bekker v. Minister of National Revenue (2004), 323 N.R. 195 (F.C.A.), refd to. [para. 66].

Canada (Attorney General) v. McKenna et al., [1999] 1 F.C. 401; 233 N.R. 52 (F.C.A.), refd to. [para. 66].

Rouleau-Joncas v. Placements Etteloc Inc. et al., 2006 QCCS 5319, refd to. [para. 68].

Counsel:

Marcel Lalonde, on his own behalf;

Kim Sheppard, for the respondent.

Solicitors of Record:

John H. Sims, Q.C., Deputy Attorney General of Canada, Montreal, Quebec, for the respondent.

This application was heard on January 21, 2008, at Montreal, Quebec, by Martineau, J., of the Federal Court, who delivered the following judgment at Ottawa, Ontario, on February 14, 2008.