Longley v. Minister of National Revenue, (1999) 19 B.C.T.C. 81 (SC)

• Judge: Quijano, J.
• Court: Supreme Court of British Columbia (Canada)
• Case Date: June 30, 1999
• Jurisdiction: British Columbia
• Citations: (1999), 19 B.C.T.C. 81 (SC)

Longley v. MNR (1999), 19 B.C.T.C. 81 (SC)

MLB headnote and full text

Temp. Cite: [1999] B.C.T.C. TBEd. AU.094

Blair T. Longley (plaintiff) v. Her Majesty The Queen as represented by the Hon. Otto Jelinek Minister of National Revenue (defendant)

(90/1523)

Indexed As: Longley v. Minister of National Revenue

British Columbia Supreme Court

Victoria

Quijano, J.

June 30, 1999.

Summary:

Longley conceived of a plan whereby taxpayers could receive federal political contribution tax credits under s. 127(3) of the Income Tax Act ("Act"), for contribu­tions made to a political party which the taxpayer could direct to be paid so as to benefit either the taxpayer or some other individual whom the taxpayer designated. As potential contributors were sceptical of the scheme, Longley sought, for five years, to obtain written confirmation from Revenue Canada that the scheme was legal. Longley alleged that from 1985 to 1990 Revenue Canada knew that his plan did not offend the Income Tax Act, but refused to acknowledge this to him in writing, and that this refusal caused damage to him and resulted in an enormous benefit to the Federal Government in the form of unclaimed tax credits. Longley sued for damages against Revenue Canada for breach of his ss. 2, 7 and 15 Charter rights or, alternatively, for mis­feasance in public office. Longley also sought a declaration that s. 245 of the Income Tax Act, the General Anti-Avoid­ance Rule, offended ss. 2, 7 and 15 of the Charter of Rights and Freedoms and was void for vagueness. At issue was: 1) whether the plan was contrary to s. 127 of the Income Tax Act prior to the introduction of s. 245; 2) did Revenue Canada commit the tort of misfeasance in public office, or a constitutional tort, in its dealings with Longley prior to the introduction of s. 245; 3) did s. 245 violate s. 2, 7 or 15 of the Charter; 4) was Revenue Canada's threat to use s. 245 to declare the plan contrary to the object and spirit of the Act a violation of Longley's Charter rights; 5) was s. 245 void for vagueness; 6) whether Revenue Canada defamed Longley; and 7) what, if any, dam­ages was Longley entitled to.

The British Columbia Supreme Court held that: 1) the plan did not violate s. 127 of the Income Tax Act prior to the introduction of s. 245; 2) up to the time of the proclamation of s. 245, Revenue Canada's response to Longley's requests amounted to misfeasance in public office; 3) s. 245 did not violate s. 2, 7 or 15 of the Charter; 4) Revenue Cana­da's threat to find the plan in violation of the object and spirit of the Act was not a misfeasance of public office; 5) s. 245 was not void for vagueness; 6) Revenue Canada did not defame Longley. The court awarded Longley $5,000 actual damages and $50,000 punitive damages.

Civil Rights - Topic 725

Liberty - Charter of Rights and Freedoms - Liberty defined - See paragraphs 105 to 113 and 119 to 120.

Civil Rights - Topic 1863

Freedom of speech or expression - Denial of - What constitutes - See paragraphs 101 to 104 and 119 to 120.

Civil Rights - Topic 8664

Canadian Charter of Rights and Freedoms - Equality rights - Application - See para­graphs 114 to 117.

Civil Rights - Topic 8668

Canadian Charter of Rights and Freedoms - Equality rights - What constitutes a breach of s. 15 - See paragraphs 118 to 120.

Damage Awards - Topic 701

Torts - Injury to economic or business relations - Misfeasance of public office - See paragraphs 133 to 136.

Damage Awards - Topic 2025.2

Exemplary or punitive damages - Mis­feasance of public office - See para­graphs 137 to 143.

Income Tax - Topic 7081

Computation of tax - Rules for all taxpayers - Political contributions - Gen­eral - See paragraphs 1 to 143.

Libel and Slander - Topic 684

The statement - What constitutes defama­tory statements - Libel - What constitutes a defamatory statement - See paragraphs 129 to 130.

Statutes - Topic 4552

Operation and effect - Validity - Vague­ness - See paragraphs 121 to 124.

Torts - Topic 9162

Duty of care - Particular relationships - Claims against public officials, authorities or boards - Misfeasance in public office - See paragraphs 62 to 95 and 125 to 128.

Cases Noticed:

Longley v. Minister of National Revenue, [1992] 4 W.W.R. 213; 14 B.C.A.C. 22; 26 W.A.C. 22 (C.A.), refd to. [para. 23].

Stubart Investments Ltd. v. Minister of National Revenue, [1984] 1 S.C.R. 536; 53 N.R. 241; 10 D.L.R.(4th) 1; [1984] C.T.C. 294; 84 D.T.C. 6305, refd to. [para. 34].

Produits LDG Products Inc. v. Minister of National Revenue (1976), 13 N.R. 438; 76 D.T.C. 6344 (F.C.A.), refd to. [para. 35].

Alberta and Southern Gas Co. v. Minister of National Revenue, [1978] 1 F.C. 454; 16 N.R. 220 (F.C.A.), refd to. [para. 38].

Antosko v. Minister of National Revenue, [1994] 2 S.C.R. 312; 168 N.R. 16, refd to. [para. 41].

Opetchesaht Indian Band et al. v. Canada et al., [1997] 2 S.C.R. 119; 211 N.R. 241; 90 B.C.A.C. 1; 147 W.A.C. 1, refd to. [para. 43].

Saint-Basile (Village Sud) v. Ciment Qué­bec Inc., [1993] 2 S.C.R. 823; 155 N.R. 173; 56 Q.A.C. 117, refd to. [para. 45].

Finlay v. Canada, [1993] 1 S.C.R. 1080; 150 N.R. 81, refd to. [para. 45].

Roncarelli v. Duplessis (1959), 16 D.L.R.(2d) 689 (S.C.C.), refd to. [para. 82].

Bourgoin SA v. Ministry of Agriculture, Fisheries and Food, [1985] 3 All E.R. 585 (C.A.), folld. [para. 85].

Chhabra v. Minister of National Revenue (1989), 26 F.T.R. 288; 89 D.T.C. 5310 (T.D.), refd to. [para. 86].

Francoeur et al. v. Canada (1994), 78 F.T.R. 109 (T.D.), refd to. [para. 87].

Stenner v. British Columbia Securities Commission et al. (1996), 82 B.C.A.C. 124; 133 W.A.C. 124; 141 D.L.R.(4th) 122 (C.A.), refd to. [para. 88].

Ichi Canada Ltd. v. Palmquist, [1997] B.C.J. No. 335 (S.C.), folld. [para. 90].

Gerrard et al. v. Manitoba and Muirhead (1992), 81 Man.R.(2d) 295; 30 W.A.C. 295; 98 D.L.R.(4th) 167 (C.A.), folld. [para. 91].

Eldridge et al. v. British Columbia (At­torney General) et al., [1997] 3 S.C.R. 624; 218 N.R. 161; 96 B.C.A.C. 81; 155 W.A.C. 81, refd to. [para. 97].

Davidson v. Slaight Communications Inc., [1989] 1 S.C.R. 1038; 93 N.R. 183; 59 D.L.R.(4th) 416; 26 C.C.E.L. 85; 89 C.L.L.C. 14,031; 40 C.R.R. 100, refd to. [para. 100].

Stasiuk v. Minister of National Revenue, [1986] 2 C.T.C. 346 (F.C.T.D.), refd to. [para. 102].

R. v. Videoflicks Ltd. et al., [1986] 2 S.C.R. 713; 71 N.R. 161; 19 O.A.C. 239; 30 C.C.C.(3d) 385; 55 C.R.(3d) 193; 35 D.L.R.(4th) 1; 28 C.R.R. 1, refd to. [para. 109].

R. v. Edwards Books and Art Ltd. - see R. v. Videoflicks Ltd. et al.

Wilson v. Medical Services Commission (B.C.) (1988), 30 B.C.L.R.(2d) 1 (C.A.), refd to. [para. 109].

Eaton v. Board of Education of Brant County, [1997] 1 S.C.R. 241; 207 N.R. 171; 97 O.A.C. 161, refd to. [para. 115].

R. v. Swain, [1991] 1 S.C.R. 933; 125 N.R. 1; 47 O.A.C. 81; 63 C.C.C.(3d) 481, refd to. [para. 116].

Taylor-Wright et al. v. CHBC-TV et al. (1999), 4 B.C.T.C. 1 (S.C.), refd to. [para. 130].

Vorvis v. Insurance Corp. of British Columbia (1984), 53 B.C.L.R. 63 (C.A.), refd to. [para. 131].

Statutes Noticed:

Income Tax Act, R.S.C. 1985 (5th Supp.), c. 1, sect. 127(3) [para. 25]; sect. 245 [para. 3]; sect. 251(1) [para. 51].

Authors and Works Noticed:

Canada, Revenue Canada, Information Circular 75-2R2, Contributions to a Registered Political Party or to a Candi­date at a Federal Election (April 24, 1978), generally [para. 48].

Canada, Standing Committee on Privileges and Elections, Minutes of Proceedings and Evidence (November 13, 1973), Issue No. 17, generally [para. 47].

Canada, Standing Committee on Privileges and Elections, Minutes of Proceedings and Evidence (December 11, 1973), Issue No. 25, generally [para. 49].

Driedger, Elmer A., Construction of Stat­utes (2nd Ed. 1983), p. 87 [para. 34].

Driedger, Elmer A., Construction of Stat­utes (3rd Ed. 1994), p. 131 [para. 44].

Hogg, Peter W., Constitutional Law of Canada (3rd Ed. 1992), pp. 1028, 1029 [para. 112].

Counsel:

Blair Longley, on his own behalf;

Hans Van Iperen and Ian Torrie, for the defendant.

This action was heard on March 6, 9-13 and 16, 1998, at Victoria, British Columbia, by Quijano, J., of the British Columbia Supreme Court, who delivered the following decision on June 30, 1999.