Graham v. Canada
A-55-96
Hawkes v. Canada
A-46-96
Strayer J.A.
23/12/96
9 pp.
Appeal from Tax Court's order striking out paragraphs 9, 10, 11 in notice of appeal, dismissing motion for better discovery of documents in relation to Dr. Clifford Revell in respect of expenses incurred by him in same enterprise in which appellants claim to be entitled to deductions for expenses incurred to gain, produce income-Appellants entered into agreement whereby undertook to provide funds to prosecute lawsuit-If lawsuit successful, appellants would share in proceeds in excess of funds advanced-Dr. Revell entering into "substantially similar" agreement-While Edmonton office of respondent allowing Dr. Revell to deduct such amounts as being expended to gain or produce income, Victoria office refusing deduction to appellants-Appeals dismissed-(1) Where party making motion to strike already pleading to allegations complained of, motions judge having discretion whether to entertain application to strike-Tax Court Judge exercised discretion in entertaining motion one year after respondent so pleading-No error in principle in exercise of discretion-(2) Court not condoning inconsistent assessments or conflicting information being provided to taxpayers-Such conduct must be avoided if taxpayers to perceive system as fair, equitable, reasonable in application, system with which expected to cooperate voluntarily-But not established law Minister always bound by own mistakes-Basic principle Minister's duty to assess, reassess if necessary, taxpayers' returns so as to apply correctly law to facts-That Minister assessing one return of taxpayer differently from another, or assessing two taxpayers involved in similar activities differently, not proof any particular assessment right-Matter for determination on appeal-Allegation in paragraph 9 Dr. Revell assessed differently by different taxation office not raising ground for attacking assessment-Although paragraph 10 asserting Victoria office of Revenue Canada advising appellants respondent would allow deductions in question, on basis Edmonton office had allowed such deductions in respect of Revell, only final assessment can be attacked and interim opinions, or even previous assessments, cannot be relied upon to establish invalidity of last assessment or reassessment, provided latter made within time allowed by statute-Proposition Minister bound by earlier assessments, statements of opinion by letter, would render meaningless times allowed for reassessment by Income Tax Act, s. 152(4)-Paragraph 11 alleging estoppel based on Minister's actions disclosing no reasonable ground for appeal-Estoppel not applicable to prevent Minister from performing duties imposed by Act, i.e. proper assessment of returns in accordance with law-Same limitation applies to doctrine of legitimate expectations-Appellants not alleging adequate facts to bring themselves within doctrine of estoppel-No allegation representee acting to detriment in reliance on representations-Paragraphs should be struck as disclosing no reasonable grounds of appeal-No basis for motions for better discovery-Tax Court of Canada Rules (General Procedure), SOR/90-688, s. 58(1)(b).