Precision Contractors Ltd. v. Saskatchewan, (2012) 393 Sask.R. 279 (CA)

• Judge: Lane, J.A.
• Court: Court of Appeal (Saskatchewan)
• Case Date: May 09, 2012
• Jurisdiction: Saskatchewan
• Citations: (2012), 393 Sask.R. 279 (CA);2012 SKCA 57

Precision Contractors v. Sask. (2012), 393 Sask.R. 279 (CA);

    546 W.A.C. 279

MLB headnote and full text

Temp. Cite: [2012] Sask.R. TBEd. MY.073

Precision Contractors Ltd. (prospective appellant/plaintiff) v. Government of Saskatchewan (prospective respondent/defendant)

(CACV2188; 2012 SKCA 57)

Indexed As: Precision Contractors Ltd. v. Saskatchewan

Saskatchewan Court of Appeal

Lane, J.A.

May 25, 2012.

Summary:

The plaintiff, an Alberta corporation, owned and leased construction vehicles and equipment which it brought into Saskatchewan for temporary use in its business. The government of Saskatchewan (the defendant) assessed provincial sales tax (PST) on the property. The plaintiff sought a declaration that the PST levied by the defendant was ultra vires the direct taxation powers granted to provinces. It claimed restitution of the amount it paid in PST between October 19, 2005 and July 24, 2009 ($2,283,921.17), as well as damages. The plaintiff applied to have the action certified as a class action.

The Saskatchewan Court of Queen's Bench, in a decision reported at 378 Sask.R. 31, found that the proposed class proceeding was ill-suited for addressing the constitutionality of the impugned PST legislation. The court adjourned the application pending a determination of the constitutional challenge. For the purposes of s. 6(1)(a) of the Class Actions Act, the court found that the pleadings disclosed the following causes of action: (a) for restitution of PST paid on purchased property pursuant to ultra vires legislation; and (b) for compensatory damages as an alternative to restitution. The court addressed the requirements under ss. 6(1)(b) and (c) of the Act, and deferred any definitive ruling on the remaining questions under ss. 6(1)(d) and (e) until the return of the application. The plaintiff applied for leave to appeal, contending that the court erred by bifurcating the action.

The Saskatchewan Court of Appeal, per Lane, J.A., granted leave to appeal.

Crown - Topic 2448

Liability of Crown arising out of the enforcement of statutes - When liable - Unconstitutional statutes - [See Practice - Topic 209.9 ].

Crown - Topic 2888

Crown immunity - Exceptions - Restitution for ultra vires taxes - [See Practice - Topic 209.9 ].

Practice - Topic 209.3

Persons who can sue and be sued - Individuals and corporations - Status or standing - Class or representative actions - Certification - Considerations (incl. when class action appropriate) - [See Practice - Topic 209.9 ].

Practice - Topic 209.9

Persons who can sue and be sued - Individuals and corporations - Status or standing - Class actions - Appeals (incl. leave to appeal) - A chambers judge adjourned the plaintiff's application to have an action certified as a class action - He ordered the central issue (the constitutionality of provincial sales tax legislation as it was calculated on out-of-province construction contractors which temporarily brought heavy equipment into the province) to be decided by way of judicial review rather than as part of the class action - On the application for leave to appeal, the plaintiff contended that the chambers judge erred by bifurcating the action - The Saskatchewan Court of Appeal, per Lane, J.A., granted leave to appeal - If the plaintiff was successful on the judicial review application and the tax was unconstitutional, it would end the plaintiff's participation, and a new application for certification would have to be commenced with a new representative plaintiff - Also, assuming success on the judicial review application, not all of the proposed class would benefit.

Sales and Service Taxes - Topic 106

Sales tax - Liability of persons and property - Purchases outside province brought into province - [See Practice - Topic 209.9 ].

Cases Noticed:

Rothmans, Benson & Hedges Inc. v. Saskatchewan (2002), 227 Sask.R. 121; 287 W.A.C. 121; 2002 SKCA 119, appld. [para. 5].

Counsel:

E.F.A. Merchant, Q.C., and Casey Churko, for the prospective appellant;

Sharon Pratchler, Q.C., and Andrew Reeson, for the prospective respondent.

This application for leave to appeal was heard in Chambers on May 9, 2012, before Lane, J.A., of the Saskatchewan Court of Appeal, who delivered the following decision on May 25, 2012.