Municipal Contracting Ltd. v. Nova Scotia (Attorney General), (2001) 199 N.S.R.(2d) 362 (SC)

• Judge: Robertson, J.
• Court: Supreme Court of Nova Scotia (Canada)
• Case Date: December 10, 2001
• Jurisdiction: Nova Scotia
• Citations: (2001), 199 N.S.R.(2d) 362 (SC);2001 NSSC 192

Municipal Cont. v. N.S. (A.G.) (2001), 199 N.S.R.(2d) 362 (SC);

 623 A.P.R. 362

MLB headnote and full text

Temp. Cite: [2002] N.S.R.(2d) TBEd. JA.004

Municipal Contracting Limited, as agent for and on behalf of Municipal Enterprises Limited (plaintiff) v. The Attorney General of Nova Scotia, representing Her Majesty the Queen in the Right of the Province of Nova Scotia (defendant)

(SH 108819; 2001 NSSC 192)

Indexed As: Municipal Contracting Ltd. v. Nova Scotia (Attorney General)

Nova Scotia Supreme Court

Robertson, J.

December 10, 2001.

Summary:

Municipal operated a quarry and manu­factured crushed rock for sale. Municipal applied for a declaration that quarry equip­ment was machinery or apparatus used in the manufacture or production of goods for sale within the meaning of ss. 11(2)(h)(iii) and 12(1)(k)(iii) of the Gasoline and Diesel Oil Tax Act Regulations. Municipal applied for certiorari to quash the decision of the Pro­vincial Tax Commissioner denying its re­quest for refunds of diesel fuel tax.

The Nova Scotia Supreme Court, in a judgment reported 110 N.S.R.(2d) 45; 299 A.P.R. 45, allowed the application, quashed the Provincial Tax Commissioner's decision and granted de­claratory relief. The Minister appealed.

The Nova Scotia Supreme Court, in a de­cision reported at 113 N.S.R.(2d) 174; 309 A.P.R. 174, allowed the appeal. The court held that there was no actual decision of the provincial Minister of Finance upon which to base the certiorari application. The Minister subsequently de­nied all the refund claims. The plaintiff sued to obtain the refunds.

The Nova Scotia Supreme Court dismissed the action.

Courts - Topic 77

Stare decisis - Authority of judicial de­cisions - Prior decisions of same court - Reconsideration - The plaintiff was granted certiorari quashing a decision of the Pro­vincial Tax Commissioner denying its request for refunds of diesel fuel tax - The Court of Appeal overturned the decision on the procedural ground that there was no actual decision of the Minister of Finance upon which to base the application - The Minister subsequently denied the refund claims - The plaintiff sued to obtain the refunds and argued, inter alia, that the principle of judicial comity applied to require the court to determine the substan­tive issue in the plaintiff's favour, as in the first decision - The Nova Scotia Supreme Court disagreed - The principle of judicial comity only applied where the decision was made by a court of competent jurisdic­tion and had not been appealed - See paragraph 51.

Estoppel - Topic 377

Estoppel by record (res judicata) - Res judicata as a bar to subsequent proceedings - When applicable - The plaintiff was granted certiorari quashing a decision of the Provincial Tax Commissioner denying its request for refunds of diesel fuel tax - The Court of Appeal overturned the de­cision on the procedural ground that there was no actual decision of the Minister of Finance upon which to base the application - The Minister subsequently denied the refund claims - The plaintiff sued to obtain the refunds and argued, inter alia, that the doctrine of issue estoppel precluded reliti­gation of the substantive issue between the parties - The Nova Scotia Supreme Court disagreed - Issue estoppel applied to final decisions - Issue estoppel was not ap­plicable where a decision was appealed and the judgment set aside - See paragraph 50.

Estoppel - Topic 386

Estoppel by record (res judicata) - Res judicata as a bar to subsequent proceedings - Issues decided in prior proceedings - [See Estoppel - Topic 377 ].

Sales and Service Taxes - Topic 83

Sales tax - Taxing powers - Interpretation -In case of doubt or ambiguity - The Nova Scotia Supreme Court discussed the prin­ciples of statutory interpretation to be applied to taxation statutes - See para­graphs 17, 18, 41 to 47, and 54 to 61 - The court stated that "The residual pre­sumption in favour of the taxpayer where the language of the [legislation] leaves doubt as to its meaning must nevertheless be 'reasonable' and recourse to this pre­sumption is clearly residual." - See para­graph 58.

Sales and Service Taxes - Topic 2743

Gasoline and motive fuel tax - Exemptions - Use in manufacture or production of goods for sale - Section 12(k)(iii) of the Gasoline and Diesel Oil Tax Act Regu­lations provided that where equipment was used in the "manufacture or production of goods for sale" the gas used was exempt from tax, subject to s. 14 - Section 14(d) took away the exemption where the gaso­line was used "in the production or pro­cessing of non-renewable resources" - Section 1(1)(mc) specified that "production or processing" meant "any non-renewable resource to the extent and in the manner determined by these regulations" - The Nova Scotia Supreme Court held that notwithstanding that the Regulations did not go on to address the "extent" or "man­ner" of any activity in connection with any non-renewable resource, where the gasoline was used in the production or processing of non-renewable resources, s. 14(d) operated to take away the exemption in s. 12(1)(k)(iii).

Statutes - Topic 522

Interpretation - General principles - Taxing statutes - [See Sales and Service Taxes - Topic 83 ].

Cases Noticed:

Gateway Materials Ltd. v. Nova Scotia (Attorney General) (1979), 35 N.S.R.(2d) 442; 62 A.P.R. 442 (T.D.), refd to. [para. 33].

Québec (Communauté urbaine) et autres v. Corporation Notre-Dame de Bon Secours, [1994] 3 S.C.R. 3; 171 N.R. 161; 63 Q.A.C. 161, refd to. [para. 43].

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

Angle v. Minister of National Revenue, [1975] 2 S.C.R. 248; 2 N.R. 397; 47 D.L.R.(3d) 544, refd to. [para. 50].

Bell v. Cessna Aircraft (1983), 149 D.L.R.(3d) 509 (B.C.C.A.), refd to. [para. 51].

Lewis Realty Ltd. v. Skalbania et al. (1981), 25 B.C.L.R. 17 (C.A.), refd to. [para. 51].

R. v. Keeping (E.L.) (1992), 116 N.S.R.(2d) 294; 320 A.P.R. 294 (Prov. Ct.), refd to. [para. 52].

Johns-Manville Canada Inc. v. Minister of National Revenue, [1985] 2 S.C.R. 46; 60 N.R. 244; 85 D.T.C. 5373, refd to. [para. 58].

Winnipeg (City) v. Morguard Properties Ltd. et al., [1983] 2 S.C.R. 493; 50 N.R. 264; 25 Man.R.(2d) 302; 3 D.L.R.(4th) 1, dist. [para. 62].

Minister of National Revenue v. Corbett, [2000] 2 F.C. 81; 248 N.R. 3; 1999 CarswellNat 1678; [1999] 4 C.T.C. 231; 21 C.C.P.B. 278; 99 D.T.C. 5624 (F.C.A.), dist. [para. 62].

Air Canada and Pacific Western Airlines Ltd. v. British Columbia, [1989] 1 S.C.R. 1161; 95 N.R. 1; 59 D.L.R.(4th) 161, refd to. [para. 64].

Cherubini Metal Works Ltd. v. Nova Scotia (Attorney General) (1995), 137 N.S.R.(2d) 197; 391 A.P.R. 197 (C.A.), refd to. [para. 18].

Truro Carpet Factory Outlet Ltd. v. Nova Scotia et al. (1991), 103 N.S.R.(2d) 214; 282 A.P.R. 214 (C.A.), refd to. [para. 64].

Johnson et al. v. Nova Scotia (Attorney General) (1990), 96 N.S.R.(2d) 140; 253 A.P.R. 140 (C.A.), refd to. [para. 64].

Statutes Noticed:

Gasoline and Diesel Oil Tax Act Regula­tions, sect. 1(1)(mc), sect. 12(1)(k)(iii), sect. 14(d), sect. 21(1), sect. 34 [para. 13].

Authors and Works Noticed:

Driedger, Elmer A., Construction of Stat­utes (3rd Ed. 1994), generally [paras. 17, 46, 47]; pp. 58 [para. 18]; 106 [para. 60].

Nova Scotia, House of Assembly, Debates (April 30, 1982), pp. 2106, 2117, 2118 [para. 34].

Spencer-Bower and Turner, Doctrine of Res Judicata (2nd Ed.), generally [para. 50].

Sullivan, Ruth, Statutory Interpretation (1997), generally [para. 44].

Counsel:

Robert G. Belliveau, Q.C., and Bruce S. Russell, for the plaintiff;

Duncan R. Beveridge, Q.C., for the de­fendant.

This action was heard on April 17 and May 4, 8 and 16, 2001, by Robertson, J., of the Nova Scotia Supreme Court, who de­livered the following decision on De­cember 10, 2001.