Ministre du Revenu national v. Gadbois et al.

• Jurisdiction: Federal Jurisdiction (Canada)
• Court: Court of Appeal (Canada)
• Judge: Létourneau, Nadon and Pelletier, JJ.A.
• Citation: (2002), 298 N.R. 374 (FCA),2002 FCA 228
• Date: 22 May 2002

MNR v. Gadbois (2002), 298 N.R. 374 (FCA)

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: [2002] N.R. TBEd. JN.037

Sa Majesté la reine (créancière saisissante/appelante) v. Transport H. Cordeau Inc. (tierce saisie/intimée), J.L. Michon Transport Inc. (tierce saisie), Gilbert Gadbois (débiteur judiciaire/intimé) et 2951-7539 Québec Inc. (mise-en-cause/intimée)

(A-64-01; 2002 FCA 228; 2002 CAF 228)

Indexed As: Ministre du Revenu national v. Gadbois et al.

Federal Court of Appeal

Létourneau, Nadon and Pelletier, JJ.A.

May 31, 2002.

Summary:

The Minister of National Revenue (MNR) certified an amount payable by the judgment debtor Gadbois and obtained a garnishment order against the garnishee, Transport H. Cordeau Inc. (See [2000] F.T.R. Uned. 172 (Protho.)). The garnishee appealed. While the matter was under consideration, the judge hearing the appeal asked the parties to sub­mit arguments respecting the jurisdiction of the Trial Division to deal with the issues raised by the garnishee.

The Federal Court of Canada, Trial Divi­sion, in a decision reported [2001] F.T.R. Uned. 274, held that only provincial courts were competent to deal with the issues raised by the garnishee. The MNR appealed raising the following questions:

(a) Does the Trial Division have jurisdic­tion, in garnishment proceedings, to deter­mine whether an assignment of debt by Transport H. Cordeau Inc., the respondent garnishee, made allegedly in fraud of the rights of the creditors, may be set up against the appellant, the Minister of National Revenue (MNR)?

(b) In that same context, does the Trial Division have jurisdiction to determine whether the releases dated February 12 and March 25, 1997, resulting from the assign­ment of debt and a secret contract between the respondent garnishee and the judgment debtor, Gilbert Gadbois, may be set up against the appellant, the MNR?

(c) Does the Trial Division have jurisdic­tion to order the lifting of the corporate veil between Gilbert Gadbois, the judgment debtor, and 2951-7539 Québec Inc. that belonged to him? and

(d) Does the Trial Division have jurisdic­tion to rule on the appeal that was before it from the prothonotary's order making the garnishment against the respondent garnishee final and ordering it to pay $100,000 with interest and costs to the judgment creditor, Her Majesty the Queen?

The Federal Court of Appeal answered the questions in the affirmative. The court there­fore allowed the appeal.

Courts - Topic 4055

Federal Court of Canada - Jurisdiction - Trial Division - Execution of judgments (incl. garnishment) - The Federal Court of Appeal discussed the jurisdiction of the Trial Division to deal with issues raised in an appeal from a garnishment order, where the issues raised involved provincial law, in this case Quebec law - See paragraphs 1 to 32.

Cases Noticed:

Wellgate International Ltd. et al. v. Minist­er of National Revenue (2000), 185 F.T.R. 223; 2000 D.T.C. 6420 (T.D.­), refd to. [para. 10].

Bois de Construction du Nord (1971) Ltée v. Guilbault (Charles) Inc. et al. and Minister of National Revenue, [1986] 2 C.T.C. 227; 77 N.R. 392 (F.C.A.), refd to. [para. 14].

Miida Electronics Inc. v. Mitsui O.S.K. Lines Ltd. and ITO-International Termi­nal Operators Ltd., [1986] 1 S.C.R. 752; 68 N.R. 241, refd to. [para. 14].

Belliard v. Québec (Sous-ministre du Revenu) (1997), 225 N.R. 347 (F.C.A.), refd to. [para. 16].

Minister of National Revenue v. Wolf and Wolf (1992), 145 N.R. 217 (F.C.A.), refd to. [para. 16].

Côté v. Ministre du Revenu national (1999), 254 N.R. 191 (F.C.A.), leave to appeal denied (2000), 262 N.R. 396 (S.C.C.), refd to. [para. 16].

Biderman v. Minister of National Revenue (2000), 253 N.R. 236 (F.C.A.), leave to appeal denied (2000), 264 N.R. 197 (S.C.C.), refd to. [para. 16].

Caisse populaire de Daveluyville v. Ministre du Revenu national (Douanes et Accise) (1998), 240 N.R. 201 (F.C.A.), refd to. [para. 16].

Counsel:

Chantal Comtois, for the appellant;

Gérald Bélanger, for the respondent.

Solicitors of Record:

Morris Rosenberg, Deputy Attorney General of Canada, Montreal, Quebec, for the appellant;

Gérald Bélanger, Montreal, Quebec, for the respondent.

This appeal was heard at Montreal, Quebec, on May 22, 2002, before Létour­neau, Nadon and Pelletier, JJ.A., of the Federal Court of Appeal. Létourneau, J.A., delivered the following decision for the Court of Appeal at Ottawa, Ontario, on May 31, 2002.