The Queen (Plaintiff)
v.
Fredericton Housing Limited (Defendant)
Trial Division, Cattanach J.—Fredericton, N.B.,
January 16; Ottawa, February 23, 1973.
Income tax—Practice and procedure—Pleading, sufficien
cy of—Particulars not pleaded—Errors of fact corrected by
amendment—Date of filing statement of claim inserted by
clerk of process—Propriety of—Statement of claim required
to be signed by Attorney General or a person authorized by
him—Whether authorized signer may delegate responsibili-
ty—Income Tax Act, s. 175(5)—Federal Court Rule 600.
On July 31, 1972, the Tax Review Board allowed an
appeal from an assessment to income tax of the profit made
by defendant on the purchase and sale of land. The Crown
appealed. The statement of claim instituting the appeal was
filed on November 27, 1972, and copies were mailed by the
Court Registry to defendant on that date but were not
received by him until November 29, which was one day
after the expiry of 120 days from the time allowed by
section 175(5) of the Income Tax Act for appeal. The
statement of claim alleged that the gain made was income
from a business but did not allege that defendant was a
corporation, the locus of the land or that defendant was a
taxpayer. The statement of claim alleged that the judgment
appealed from was rendered on July 31, 1971, instead of
July 31, 1972, but this error was corrected by amendment
before defendant pleaded. The date of filing the statement
of claim was inserted by the clerk of process who also
inserted the date above the signature of plaintiff's solicitor.
The statement of claim purported to be signed by D, who
had been authorized to do so by the Deputy Attorney
General, was in fact signed in D's name by a solicitor acting
with D's authority.
Held, a motion by defendant to strike out the statement of
claim must be dismissed.
1. The statement of claim disclosed a cause of action, and
if defendant was prejudiced it should have asked for
particulars.
2. The correction of the date of the judgment appealed
from by amendment was retroactive to the date of filing.
3. The clerk of process was right in inserting the filing
date of the statement of claim, and while he ought not to
have inserted the date above the signature of plaintiff's
solicitor, the validity of the statement of claim was not
thereby affected.
4. Under section 175(5) of the Income Tax Act, the date
of service of the statement of claim on defendant was the
date of mailing the copies thereof by the Registry, viz. on
November 27, 1972, which was within the time allowed for
appeal.
5. The signature of D's name by someone else on D's
authority was in fact the signature of D. London County
Council v. Agricultural Food Products Ltd. [1955] 2 Q.B.
218, followed; Carltona Ltd. v. Commissioners of Works
[1943] 2 All E.R. 560; Lewisham v. Roberts [1949] 1 All
E.R. 815; Gamache v. Jones [1968] 1 Ex.C.R. 345,
considered.
MOTION.
COUNSEL:
G. W. Ainslie, Q.C. and R. S. G. Thompson
for plaintiff.
E. J. Mockler and E. McGinley for
defendant.
SOLICITORS:
Deputy Attorney General of Canada for
plaintiff.
Hoyt, Mockler, Allen, Dixon and Godin,
Fredericton, for defendant.
CATTANACH J.—This matter arose as a conse
quence of a motion by the defendant for an
order granting the defendant leave to enter a
conditional appearance to an appeal de novo
from a decision of the Tax Review Board dated
July 31, 1972 initiated by the filing of a state
ment of claim.
After an exchange of correspondence
between counsel particularly a letter dated
December 29, 1972 from Mr. Mockler, counsel.
for the defendant, to Mr. Ainslie, counsel for
the plaintiff, as to the objections to the state
ment of claim to be raised by Mr. Mockler dated
January 8, 1973 wherein the material to be
placed before the Court was outlined, it was
agreed that counsel for the plaintiff would con
sent to a conditional appearance and that the
motion would be considered as an application to
strike out the statement of claim in its entirety
to be argued on its merits but limited to the
objections to the statement of claim as outlined
in items 1 to 5 in Mr. Mockler's letter dated
December 29, 1972.
Those grounds of objection to the statement
of claim are as follows:
(1) The statement of claim contravenes Rule
408 in that it does not state the material facts
to support the action.
(2) The statement of claim as originally filed
purported to commence an action from a
judgment dated July 31, 1971 and mailed
August 1, 1971 was, on its face, in contraven
tion of section 172 of the Income Tax Act.
I would mention here parenthetically that the
insertion of the dates of July 31, 1971 and
August 1, 1971 in paragraph 1 of the statement
of claim was by clerical error and that the
plaintiff amended its pleadings pursuant to Rule
421 whereby any party may amend his plead-
ings without leave at any time before any other
party has pleaded thereto and that this amend
ment was prior to any pleading by the defend
ant, so that the references to the figures 1971 in
the second and third lines of paragraph 1 of the
statement of claim were deleted and replaced by
the figures 1972.
This amendment was done by written altera
tions in accordance with Rule 429 since the
amendment did not require the insertion of
more than 10 words on the page.
Two certified copies of the amended state
ment of claim were transmitted to the defendant
on December 5, 1972.
(3) The statement of claim purports to be
signed by F. J. Dubrule on behalf of D. S.
Maxwell, Deputy Attorney General of
Canada, whereas the name F. J. Dubrule was
written by Mr. Storrow. The contention of
counsel for the defendant was to be that Mr.
Storrow should have signed his own name on
behalf of D. S. Maxwell and that Mr. Dubrule,
being the agent of Mr. Maxwell, would not
have authority to sub-delegate.
(4) The original statement of claim when filed
was not dated. The date of November 27,
1972 was inserted by a Deputy Clerk of Pro
cess. On the first page a typewritten endorse
ment reading "Filed this (blank) day of
(blank) 1972" was also completed by the
Deputy Clerk of Process who inserted "27th"
in the first blank and the word "November"
in the second blank. It was to be the conten-
tion of the defendant that the Deputy Clerk of
Process had no authority to do this.
At this point I would again add parenthetical
ly that the Deputy Clerk of Process inserted the
dates in the two places indicated on his own
initiative and not on the instructions of the
person who presented the statement of claim to
him for filing over the counter in the Registry.
The matter was argued upon this basis so that
no question of agency arises in these instances.
(5) The last item was that counsel for the
defendant would contend that the action was
begun out of time in any event since the
statement of claim was not served on the
defendant until November 29, 1972.
In a letter dated December 19, 1972 from Mr.
Ainslie to Mr. Mockler which constituted part
of the material by agreement between the par
ties it was stated,
... I understand that Mr. Power has confirmed to you that
Mr. Dubrule's signature was in fact endorsed upon the
Statement of Claim by Mr. Storrow, one of the solicitors
who works in the Tax Litigation Section. I wish to further
confirm that Mr. Storrow, as one of the solicitors who forms
part of the Tax Litigation Section, had the authority to sign
the Statement of Claim... .
During his argument counsel for the plaintiff
contended that Mr. Storrow had the authority
from Mr. Dubrule to endorse his name on the
statement of claim.
The above quoted extract from Mr. Ainslie's
letter is ambiguous. Therefore at the request of
counsel for the defendant I adjourned the
matter in order that the plaintiff might file an
affidavit or affidavits on the question of the
authority given by Mr. Dubrule to Mr. Storrow.
I gave leave to counsel for the defendant to
submit written argument on this issue after the
affidavits had been produced to him. I also
afforded him the opportunity to decide whether
he wished to cross-examine upon any affidavit
produced. He has now concluded that he does
not need to cross-examine and has submitted
written argument.
During the oral argument on the merits of the
motion counsel for the defendant raised an
objection which was not one of the five objec-
tions agreed upon between counsel. It was to
the effect that the typewritten words and letters
"D. S. Maxwell, Deputy Attorney General" was
not the affixing of the signature of D. S. Max-
well. As I understood his submission it was that
the word and letters "D. S. Maxwell" should
have been written manually by Mr. Dubrule or
by an impression of a rubber stamp facsimile of
Mr. Maxwell's signature and that in the event of
either procedure being adopted that Mr.
Dubrule should also sign his own name in a
manner indicative that he had the authority to
manually write Mr. Maxwell's name or affix the
stamp facsimile of Mr. Maxwell's signature.
I did not preclude counsel for the defendant
advancing that argument despite the fact that
this ground of objection was not included as a
ground in the agreement between counsel, but I
have afforded counsel for the plaintiff the
opportunity to reply thereto in writing.
Adverting to the first objection to the state
ment of claim, which is that it does not state the
material facts necessary to sustain a cause of
action, Rule 408(1) requires that "every plead
ing must contain a precise statement of the
material facts on which the party pleading
relies".
The statement of claim, which is commend
able in its brevity, consists of four paragraphs
under the heading "Statement of Facts".
The first paragraph recites the fact that the
Tax Review Board allowed the defendant's
appeal from the Minister's assessment to
income tax.
An appeal from a decision of the Tax Review
Board is by way of a hearing de novo which
accounts for proceeding by way of statement of
claim.
The second paragraph alleges the purchase of
a parcel of property by the defendant in 1965 at
the cost specified, the sale of a portion of that
parcel in 1970 at a specified sale price and that
a gain in the amount of $168,018 was realized
by the defendant.
Paragraph 3 recites that the Minister included
the gain in computing the defendant's income on
the assumption that the gain was income from a
business or venture in the nature of trade.
These allegations, in my view, comply in
spirit with Rule 408. It clearly raises the issue of
what has been commonly referred to as a "trad-
ing" case. It discloses with equal clarity the case
which the Minister will put forward and with
abundant clarity discloses the case which the
defendant will be required to meet.
However counsel for the defendant submits
that the statement of claim is deficient in that it
does not allege,
(1) that the defendant is a body corporate and
politic incorporated pursuant to the laws of a
specified jurisdiction;
(2) the place where the land sold is situate;
and
(3) that the defendant is a taxpayer or subject
to the Income Tax which could have been
accomplished by an allegation that the
defendant was resident in Canada or carried
on business in Canada.
It is a cardinal rule that one party has no right
to dictate to the other how he shall plead sub
ject only to the modification and limitation that
the parties must not offend against the rules of
pleading laid down by law.
As I have indicated above the general rule of
pleading is that those facts which will put the
defendant on guard as to the case he has to
meet at trial shall be stated and material facts
are those as are necessary to formulate a cause
of action.
This I think has been done by the present
statement of claim.
I fail to follow how the failure to allege that
the defendant is an incorporated joint stock
company can in any way prejudice the defend
ant. This fact is well known to the defendant
and an averment of this kind is not essential to
be proven by the Minister as a condition to his
success at trial. In any event in the style of
cause the corporate name of the defendant
appears the concluding word of which is "Limit-
ed". In all common law jurisdictions in Canada
there are statutory provisions that the conclud
ing word of a joint stock company shall be
Limited or the abbreviation thereof. I also fail
to follow that the omission of an allegation by
what jurisdiction the defendant is incorporated
would prejudice the defendant in its defence or
is a fact which the Minister must prove as
essential to his success.
No doubt counsel for the defendant by sub
mitting that the omission of an allegation as to
the description of the land which was sold and
its situs as well as an allegation that the defend
ant is a taxpayer has in mind that these are
averments essential to bring the defendant
within the purview of the Income Tax Act and
as such the lack of a "material" statement
makes the statement of claim bad.
The question whether a particular fact is
material depends upon the special circum
stances of the particular case. In this instance
paragraph one of the statement of facts alleges
that the Tax Review Board by its judgment
allowed the defendant's appeal from the assess
ment by the Minister for the defendant's 1970
taxation year. The formal judgment is dated
July 31, 1972 and ordered that the appeal be
allowed and the matter be referred back to the
Minister for re-assessment accordingly. Com
prehensive reasons for judgment were also
given. It is, therefore, obvious that the appeal
was heard and determined on the question of
whether the gain realized by the defendant was
the enhanced value of a capital or arose from a
business or venture in the nature of trade.
It follows from this that the defendant was
subject to the Income Tax Act. This would
remain so and is implicit from the allegations of
fact in paragraph one bearing in mind that this is
an appeal by way of a hearing de novo.
Accordingly the defendant has not been
placed at a disadvantage.
Further it seems to me that if the land is not
situate in Canada or that the defendant is not
resident in Canada, then the transaction in ques
tion may not be the subject-matter of taxation in
Canada. If this is so then it seems to me that
such matters are properly the subject-matter of
defence. It is not the function of a statement of
claim to anticipate the defence and state what
would be alleged in response thereto if said.
It is my opinion that the statement of claim in
its present form discloses a cause of action.
Assuming, however, that the defendant is pre
judiced in some way then the remedy would be
to ask for particulars. I do not think that the
statement of claim should be struck out but the
Minister should be given leave to amend.
I base the opinion I have last expressed above
on Rule 302 that no proceeding shall be defeat
ed by any merely formal objection and that
non-compliance with a rule of practice shall not
render any proceeding void but that such pro
ceedings may be amended.
However the present motion is to strike out
the statement of claim in its entirety as being
bad. I am not being asked to cure any deficiency
by ordering particulars or an amendment.
Head B of the statement of claim is entitled
"Statutory Provision upon which the plaintiff
relies and the reasons which he intends to sub
mit". Paragraph 4 states that the Minister
intends to rely on sections 3, 4 and 139(1)(e) of
the Income Tax Act. Section 3 provides that the
income of a taxpayer is his income from all
sources inside or outside Canada and includes
income from businesses. By section 4 income
from a business is the profit therefrom. Section
139(1)(e) defines "business" as including an
adventure or concern in the nature of trade.
These are the statutory provisions relied upon
and which are invariably cited in trading cases
to bring a single transaction within the definition
of business.
Counsel for the defendant contends that the
statement of claim is bad because paragraph 4
does not contain the reasons which the Minister
intends to submit as stated in the title to the
heading. There is such omission.
However paragraph 3 of the statement of
facts recites:
The Minister of National Revenue in assessing the
Defendant for its 1970 taxation year and including in its
income the gain of $168,018.00 did so on the assumption
that the gain arising therefrom was income from a business
or venture in the nature of a trade.
This is clearly the reason for which the Minis
ter assessed the defendant as he did and to
repeat that reason in paragraph 4 would, in my
view, be needless repetition. The defendant has
been apprised of the case to be put forward by
the Minister which it will be compelled to meet.
For the reasons above expressed I decline to
strike out the statement of claim on the first
ground advanced.
The second ground advanced for striking out
the statement of claim is that as originally filed
it purported to commence an appeal de novo
from a judgment dated July 31, 1971 and mailed
on August 1, 1971. Under section 172 of the
Income Tax Act which came into force on Janu-
ary 1, 1972, the Minister or taxpayer may
appeal to the Federal Court of Canada from a
judgment of the Tax Review Board within 120
days from the day on which the registrar of that
Board mails the decision to the Minister or the
taxpayer.
Accordingly on the face of the document the
appeal was filed beyond the time.
However as I mentioned above, the insertion
of the dates of July 31, 1971 and August 1,
1971 was done in error. These errors were
corrected under Rule 421 before any pleading
by the defendant, to read July 31, 1972 and
August 1, 1972 and the defendant was advised
of the amendments on December 5, 1972.
An amendment duly made, with or without
leave, takes effect, not from the date when the
amendment is made, but from the date of the
original document which it amends. (See
Hodson L.J. in Warner v. Simpson [1959] 1
Q.B. 297 at p. 321.)
Since the amendment is retroactive the state
ment of claim cannot be struck out on the
second ground.
I propose, at this point, to depart from the
numerical sequence of the grounds of objection
to the statement of claim and consider the
fourth and fifth objections leaving the third
objection, which has caused me the greatest
concern, until the last.
The fourth objection is two-fold. The first is
that a Deputy Clerk of Process inserted "27th"
and the word "November" in a legend at the top
of the statement of claim reading, "Filed this
day of 1972",
without authority to do so.
I do not agree but on the contrary I think it
was the responsibility of the Clerk of Process to
do so.
Rule 400 provides that unless otherwise pro
vided, every action shall be commenced by
filing an originating document, which may be
called a statement of claim or a declaration in
the form of Form 11 in an appendix to the
Rules. In Rule 2, which is a definition and
interpretation rule, paragraph (3) states that the
reference to a "form" in the Rules shall be
construed as a reference to that form in the
appendix and as a direction that the document
referred to shall follow the form as nearly as
may be.
Form 11 bears the endorsation,
Filed on the day of
19
By Rule 201 there shall be maintained with
respect to every proceeding in the Court a file
on which shall be kept duly stamped to show
the date and time of filing or receipt permanent-
ly bound in the order in which they are
received, every document filed pursuant to the
Rules.
Paragraph (4) of Rule 201 prohibits the
removal of documents from the Court file
except by an order of the Court or, in the
ordinary course of work in the Registry by an
officer responsible to ensure that it is replaced
in its proper position.
In compliance with Rule 201 the Registry has
adopted a stamp device to show the date and
time a document is filed which is affixed to the
document when filed.
It is quite obvious that a Clerk of Process
shall affix that stamp and not the person who
presents a document for filing. A document is
not filed until so stamped when it becomes part
of the Court file. Until that time it is impossible
to complete the endorsation prescribed by Form
11 indicative of the date of filing.
Bearing in mind the prohibition of removal of
documents from the Court file except by order
or in the course of the work of the Registry and
that many documents are sent by mail when it is
impossible to forecast when they will be
received and filed, it is only reasonable and
practical that the Clerk of Process should com
plete the endorsation in question.
The éndorsation on Form 11 serves precisely
the same purpose as the stamp. It is inconceiv
able that a person other than a duly authorized
clerk in the Registry office could affix that
stamp. The reason for the endorsation on Form
11 is to facilitate the preparation of certified
copies which for mechanical reasons the stamp
is not practical.
In my view this endorsation is the same as the
stamp and if the stamp must be affixed by
Registry personnel, it follows that the endorsa-
tion must be completed by those personnel.
It is for these reasons that I do not accept the
defendant's contention that the Deputy Clerk of
Process had no authority to insert the date of
filing in the endorsation.
The second part of this fourth objection is
that the Deputy Clerk of Process completed the
blanks in the dating of the statement of claim.
Form 11 provides for the dating of the state
ment of claim by concluding the document as
follows:
Dated at , this
day of , 19
with a space indicated below for the signature
by the attorney or solicitor for the plaintiff.
The statement of claim herein was received
and filed by the Registry office with the place
completed in typing but with the dates in blank.
A Deputy Clerk of Process, on his own initia
tive, inserted these dates.
Obviously the completion of this part of the
statement of claim is the responsibility of the
solicitor for the plaintiff and is not that of any
officer or clerk employed in the Registry.
I do not condone the enterprise of the Deputy
Clerk of Process who must have noticed that
the statement of claim was not dated and under
took to cure that omission by completing the
blanks by inserting a date coincident with the
date of filing, but I do not think that this unwar
ranted assumption of authority affects the valid
ity of the statement of claim.
In Halsbury, 3rd ed. vol. 11 paragraph 604 it
is stated,
An alteration made in a deed, after its execution, in some
particular which is not material does not in any way affect
the validity of the deed; and this is equally the case whether
the alteration was made by a stranger or a party to the deed.
The rule was laid down in Pigot's case (1614)
11 Co. Rep. 26b, at p. 27a,
So if the obligee himself alters the deed by any of the said
ways, although it is in words not material, yet the deed is
void; but if a stranger, without his privity, alters the deed by
any of the said ways in any point not material, it shall not
avoid the deed, .. .
Pigot's case was considered in Aldous v.
Cornwell (1868) L.R. 3 Q.B. 573 at p. 579. Lush
J. speaking for the Court after reviewing the
authorities said,
This being the state of the authorities, we think we are not
bound by the doctrine in Pigot's Case, or the authority cited
for it; and not being bound, we are certainly not disposed to
lay it down as a rule of law that the addition of words which
cannot possibly prejudice any one, destroys the validity of
the note.
The rule in Pigot's case that any alteration
made by the obligee after execution invalidates
the deed, must, since the decision of Aldous v.
Cornwell, be taken to apply only to material
alterations.
Pigot's case was overruled on the point that if
the obligee altered a deed it was void even
though the alteration was immaterial by Bishop
of Crediton v. Bishop of Exeter [1905] 2 Ch.
455, where Swinfen Eady J. said at page 459,
... In other words, Pigot's Case is not now any authority
that where the alteration is not material the deed is made
void.
The rule in Pigot's case that "if a stranger,
without the privity of an obligee, alters the deed
in any point not material, it shall not avoid the
deed" stands unaffected.
These cases are cited by the editor of Hals -
bury in the footnotes as authority for the propo
sition succinctly stated in the paragraph quoted
above.
While these cases deal with deeds which are
contracts, nevertheless, the principles enunciat
ed therein, in my view, apply with equal force to
the statement of claim herein bearing in mind
the spirit which inspired Rule 302 that merely
formal objection or failure to comply with the
Rules shall not defeat or render the proceedings
void.
The alteration of the statement of claim by
the Deputy Clerk of Process was not a material
alteration. The requirement that the statement
of claim be dated is a formality. In the present
instance the statement of claim could have been
dated on any one of 120 days immediately fol
lowing August 1, 1972, the day on which the
Registrar of the Tax Review Board mailed the
decision of that Board to the defendant. It
would seem to me that the statement of claim,
which becomes effective only on filing with the
Registry, would be equally effective even
though undated. The material date is when the
action was commenced by filing the statement
of claim in the Registry.
For the foregoing reasons I decline to strike
out the statement of claim herein on the fourth
ground advanced by the defendant.
The fifth ground of objection is that the
action is out of time in that the statement of
claim was not served on the defendant until
November 29, 1972.
Section 172(1) of the Income Tax Act reads
as follows:
172. (1) The Minister or the taxpayer may, within 120
days from the day on which the Registrar of the Tax Review
Board mails the decision on an appeal under section 169 to
the Minister and the taxpayer, appeal to the Federal Court
of Canada.
The Registrar of the Tax Review Board
mailed the decision of the Board on August 1,
1972. Therefore the time within which the Min
ister may appeal to the Federal Court as provid
ed in section 172(1) would expire on November
28, 1972.
Section 175(1) of the Income Tax Act
provides:
175. (1) An appeal to the Federal Court under this Act,
other than an appeal to which section 180 applies, shall be
instituted,
(a) in the case of an appeal by a taxpayer,
(i) in the manner set forth in section 48 of the Federal
Court Act, or
(ii) by the filing by the Minister in the Registry of the
Federal Court of a copy of a notice of objection pursu
ant to paragraph 165(3)(6); and
(6) in the case of an appeal by the Minister, in the manner
provided by the Federal Court Rules for the commence
ment of an action.
Section 48(1) of the Federal Court Act is as
follows:
48. (1) A proceeding against the Crown may be instituted
by filing in the Registry of the Court a document in the form
set out in Schedule I to this Act.
The remaining subsections provide for the
material to be filed, the service thereof on Her
Majesty and a certificate of service.
Rule 600 of the Federal Court, covering
actions by the Crown, provides in part as
follows:
Rule 600. (1) Except in a case where some other proce
dure is required by statute, Rule 400 applies to an action by
the Crown, .. .
Rule 400, which is applicable in the present
instance, reads as follows:
Rule 400. Unless otherwise provided every action shall be
commenced by filing an originating document, which may be
called a statement of claim or a declaration ... .
If it were incumbent upon me to decide, the
language of section 48 of the Federal Court Act
and Rule 400 would lead me to the conclusion
that the action is commenced by the filing of the
originating document in the Registry, in this
instance on November 27, 1972.
The position taken by counsel for the defend
ant is that the action is not commenced until the
originating document has been filed in the Reg
istry and served on the defendant and that serv
ice on the defendant is on the day of receipt by
the defendant, which in this instance was on
November 29, 1972, the day after the expiration
of the time for appeal.
The certificate of the Clerk of Process is that
the original and two copies of the statement of
claim were received and filed in the Registry on
November 27, 1972 and that the copies were
transmitted by registered mail to the defendant
at the latest known address, 829 Aberdeen
Street, Fredericton, N.B. all in accordance with
subsection (4) and subsection (5) of section 175
of the Income Tax Act which read as follows:
175. (4) Where an appeal is instituted by the Minister
under this section or a copy of a notice of objection is filed
in the Registry of the Federal Court by him pursuant to
paragraph 165(3)(b) and the Minister files the originating
document or the copy of the notice of objection, together
with two copies or additional copies thereof and a certificate
as to the latest known address of the taxpayer, an officer of
the Registry of the Court shall, after verifying the accuracy
of the copies, forthwith on behalf of the Minister serve the
originating document or the copy of the notice of objection
on the taxpayer by sending the copies or additional copies
thereof by registered mail addressed to him at the address
set forth in the certificate.
(5) Where copies have been served on a taxpayer under
subsection (4), a certificate signed by an officer of the
Registry of the Federal Court as to the date of filing and the
date of mailing of the copies shall be transmitted to the
office of the Deputy Attorney General of Canada and such
certificate is evidence of the date of filing and the date of
service of the document referred to therein.
During argument I expressed the view that
the date of service on the defendant was the
date of mailing copies of the originating docu
ment to the taxpayer. In my view the quoted
subsection (5) of section 175 is susceptible of
no other interpretation than that the date of
service on the defendant is the date of the
mailing of the copies by the Registry.
I am confirmed in this view by the decision of
Hyndman D.J. in M.N.R. v. Walker [1951]
C.T.C. 334. In that case Hyndman D.J. was
obliged to interpret section 89(2) of the Income
Tax Act then in force. He said at page 336:
However, one must examine carefully the language of
Section 89(2) above set out. The wording is, "may be served
upon the taxpayer either personally or by being `sent' to him
at his last known address by registered mail." My interpreta
tion of this wording is that it is not the receipt of the notice
by the taxpayer which is important, but its "being sent;" and
the date on which it was "sent", should be regarded as the
date of service.
On mature reflection I adhere to my previous
ly expressed opinion that the service was in
time and accordingly this objection fails.
I now turn to the last objection to the validity
of the statement of claim which is the third
ground set forth in the letter of December 29,
1972 from counsel for the defendant to counsel
for the plaintiff which I quote:
3. The Statement of Claim purports to be signed by Mr.
Dubrule on behalf of D. S. Maxwell and we both know the
document was, in fact, signed by a Mr. Storrow while Mr.
Dubrule was in Toronto. It will be our position that Mr.
Storrow should have signed his own name on behalf of Mr.
Maxwell and that Mr. Dubrule, being an agent of Mr.
Maxwell, would not have authority to sub-delegate.
In oral argument it was pointed out by coun
sel for the defendant that Rule 600 specifically
requires that,
... A statement of claim or declaration in an action by the
Crown may be signed by the Attorney General of Canada,
the Deputy Attorney General of Canada, or by some person
duly authorized to affix the signature of one of them
thereto.
The word "may" as used in the context is
permissive in the sense that a statement of claim
or declaration may be signed by one of two
persons or a person authorized to affix the
signature of either such person but it is to be
construed as obligatory in that the document
must be so signed by one of such persons.
It is common ground that D. S. Maxwell was
at the material time the Deputy Attorney Gener
al of Canada and that F. J. Dubrule was a
person duly authorized to affix the signature of
D. S. Maxwell to a statement of claim.
The signature of the statement of claim herein
was in the following manner,
D. S. Maxwell
Deputy Attorney General of Canada
per: "F. J. Dubrule"
F. J. Dubrule
All words and letters were typewritten except
"F. J. Dubrule" above the line which was writ
ten manually.
It is also common ground that the manually
written initials and surname "F. J. Dubrule"
were not so written by Mr. Dubrule but by Mr.
Storrow, a solicitor in the Tax Litigation Section
of the Department of Justice of which section
Mr. Dubrule is the director.
Basically it was the contention of counsel for
the defendant that Mr. Dubrule being authorized
to affix the signature of the Deputy Attorney
General, he could not delegate that authority to
Mr. Storrow.
Counsel for the Crown in reply contended
upon the basis of authorities cited that the sig-
nature "F. J. Dubrule" subscribed by Mr. Stor-
row was in fact the signature of Mr. Dubrule.
During argument counsel for the defendant
disputed that Mr. Storrow had been authorized
by Mr. Dubrule to sign his name. Because the
agreement between counsel was not susceptible
of indicating the agreement in this respect in
clear and unequivocal terms I concurred in
counsel for the defendant's insistence that evi
dence of this authority be produced by affidavit
and gave leave to the Crown to do so.
Also during argument counsel for the defend
ant raised the further point, not previously put
forward as a ground of objection, that the type
written initials and surname "D. S. Maxwell"
could not be adopted as the signature of Mr.
Maxwell but that his name should have been
written manually or affixed by a rubber stamp
of Mr. Maxwell's signature.
Again he required to be informed of how the
typewritten initials and surname were affixed
and by whom. I gave leave to counsel for the
Crown to provide a further affidavit covering
this subject-matter.
These affidavits have now been produced.
The affidavit of Linda A. Terry, who works
as a secretary in the Tax Litigation Section,
deposes as to a telephone call she received from
Mr. Dubrule instructing her to take a statement
of claim left on his desk and have it signed by
one of the lawyers in the Tax Litigation Section
and filed with the Registry of the Federal Court.
The affiant further deposes of how on Novem-
ber 27, 1972 she took the statement of claim to
Mr. Storrow to sign. When the statement of
claim had been signed and filed in the Registry
she then telephoned Mr. Dubrule and informed
him of what had been done.
In my view the affidavit of Miss Terry estab
lishes that Mr. Dubrule authorized and instruct
ed her to have a lawyer in the Tax Litigation
Section execute, the statement of claim. Any one
of the several lawyers in the Section, of which
Mr. Storrow was one, are covered by those
instructions. Miss Terry complied with the
instructions received by her from Mr. Dubrule
by having Mr. Storrow sign the statement of
claim and so reported.
The instructions of Mr. Dubrule received by
Miss Terry as related by her are so broad as to
be susceptible of two interpretations, (1) that
Mr. Storrow execute the statement of claim by
signing his own name "M. R. V. Storrow" or (2)
that Mr. Storrow sign Mr. Dubrule's name.
If Mr. Storrow had accepted the first interpre
tation he could have subscribed his own name
assuming that he was authorized to affix the
signature of the Deputy Attorney General.
However he chose to interpret the instructions
in the second manner and signed Mr. Dubrule's
name, which course, because of the nature of
the instructions conveyed by Miss Terry from
Mr. Dubrule, he was, in my view, entitled to do.
The argument of counsel for the Crown, as I
understood it, may be summarized as follows:
(1) that the signature, F. J. Dubrule, manually
written by Mr. Storrow was in fact the signa
ture of Mr. Dubrule because where a person
authorizes another to sign for him the signa
ture of a person so signing is the signature of
the person authorizing it;
(2) that the writing of the name "F. J.
Dubrule" by a person authorized to do so, to
wit, Mr. Storrow, is the affixing of the signa
ture, D. S. Maxwell, by a person authorized to
affix that signature, to wit, Mr. Dubrule.
In The Queen v. The Justices of Kent (1873)
L.R. 8 Q.B. 305, one Weld appealed against the
rating of his lands. The notice of appeal was
required to be "signed by the person giving the
same or by his attorney." The notice was not
signed by Weld by his attorney but was signed
in Weld's name by the clerk to his attorney, by
Weld's authority. It was objected that the notice
of appeal was bad because the signature of the
appellant was not in his handwriting.
Blackburn J. said at page 307,
No doubt at common law, where a person authorizes
another to sign for him, the signature of the person so
signing is the signature of the person authorizing it; never
theless there may be cases in which a statute may require
personal signature.
and later on the same page,
Here the clerk, having full authority from the appellant,
signed for him, and this is a sufficient signing at common
law. I see nothing in this statute that makes a personal
signature necessary, and the rule must therefore be made
absolute.
Quain J. said also at page 307:
I am of the same opinion. We ought not to restrict the
common law rule, qui facit per alium facit per se, unless the
statute makes a personal signature indispensable.
Archibald J. spoke to like effect as Quain J.
In France v. Dutton [1891] 2 Q.B. 208, the
County Court rules required that particulars of
claim be signed "by the solicitor". The particu
lars were signed in the name of the solicitor by
his clerk in pursuance of a general authority.
Lord Coleridge C.J. held that the signature
was sufficient quoting with approval the expla
nation of Blackburn J. in The Queen v. Kent
Justices (supra) as set out above.
In The Queen v. Cowper (1890) 24 Q.B.D.
533, the question was whether the signature of a
solicitor was sufficiently signed solely by the
appearance of a lithographed statement of the
solicitor's name. This was held by the majority
to be insufficient.
Lord Esher M.R., who dissented, said at page
535:
I know of no case with the exception of a will in which, if
a man's name is put down by him with the intent that it shall
be treated as his signature, that is insufficient, because it is
not in his handwriting.
The majority held that the rules contemplated
that it must be shown that the matter had come
under the personal notice of the solicitor and
had been adopted by him which was not the
case when the solicitor's name was merely litho
graphed but the remarks by Lord Esher quoted
above were not challenged but have been cited
with approval in many subsequent cases.
In London County Council v. Agricultural
Food Products Ld. [1955] 2 Q.B. 218, tenancy
agreements made by the London County Coun
cil, as landlords, contained a clause to the effect
that if the landlords desired to terminate the
tenancy, it must be by "a written notice signed
by the valuer to the council." The landlords
served notices to quit on the tenants on which
the name of the valuer to the Council appeared
as signatory, but his name was written by an
assistant valuer with nothing on the document
to show the signature was by proxy.
These facts are the exact parallel of the signa
ture "F. J. Dubrule" by Mr. Storrow.
Lord Denning had this to say at page 222:
On the wording of this tenancy agreement, I think that a
signature by proxy was permissible on this notice to quit.
Take the case where the tenants desire to determine the
tenancy. The notice has to be in writing "signed by the
tenants." But the tenant is a limited company which cannot
write its own name. It can only sign by proxy, as, for
instance, by a director or secretary signing on its behalf.
Take next the case where the London County Council desire
to give a notice to quit. The notice has to be a written notice
"signed by the valuer to the council." The valuer is not
designated by name, but by his office. The tenants might not
even know his name. Valuers come and go without the
tenants being any the wiser. The personality of the valuer
does not come into it. In these circumstances I think that a
signature by proxy is permissible. The valuer can get one of
the assistant valuers to write his name for him; but the
assistant should add the letters "p.p." to show that it is done
by proxy, followed by his initials.
Obviously Lord Denning feels that when
someone signs someone else's name with that
person's authority the better practice is to add
"per", "per proc." or "p.p." to indicate that it
was done by proxy followed by the proxy's
initials.
To comply with Lord Denning's preference
Mr. Storrow should have written "F. J. Dubrule,
per M. R. V. Storrow" or his initials "M. R. V.
S.".
However this was not done in the London
County Council (supra) case nor in the present
instance.
Lord Denning continued, on page 223 to say,
The second question is more difficult. The assistant valuer
did not add the letters "p.p." as he ought to have done. This
is a bad practice because it is misleading. Anyone who did
not know Toole's signature would think that he had himself
signed the document. If it were not for authority, I should
have thought that this was a fatal flaw. But there are two
cases which show the contrary. In Reg. v. Kent Justices
((1873) L.R. 8 Q.B. 305) and France v. Dutton ([1891] 2
Q.B. 208) a clerk wrote the name of the principal, being duly
authorized so to do, but did not add anything to show that it
was done by proxy. Nevertheless the signature was done by
proxy. Nevertheless the signature was held good. I do not
think that we should disturb cases of such long standing;
especially when section 91(1) of the Bills of Exchange Act,
1882, proceeds on the same footing. That section says that:
"Where, by this Act, any instrument or writing is required to
be signed by any person it is not necessary that he should
sign it with his own hand, but it is sufficient if his signature
is written thereon by some other person by or under his
authority." That Act is a codification Act, and is therefore a
statutory recognition of the rule in Reg. v. Kent Justices
(L.R. 8 Q.B. 305). Applying this rule, I think that the
signature of this notice to quit should be held good so long
as it was authorized by Toole.
I would point out that section 4 of the Bills of
Exchange Act, R.S.C. 1970, c. B-5 is in the
identical language of section 91(1) of the Bills of
Exchange Act 1882 quoted by Lord Denning.
Lord Romer said at pages 223-4:
It is established, in my judgment, as a general proposition
that at common law a person sufficiently "signs" a docu
ment if it is signed in his name and with his authority by
somebody else; and in such case the agent's signature is
treated as being that of his principal. That this is so was
recognized by Blackburn J. in Reg. v. Kent Justices (L.R. 8
Q.B. 305) by Lord Esher in Reg. v. Cowper, ((1890) 24
Q.B.D. 533; 6 T.L.R.) and by the Divisional Court in France
v. Dutton ([1891] 2 Q.B. 208. The definition of "signature"
in Stroud's Judicial Dictionary is also in conformity with the
principle.
Lord Parker began his judgment by quoting
Stroud's Judicial Dictionary. He said at pages
225-6:
The definition of "Signed; signature" in Stroud's Judicial
Dictionary, 3rd ed., vol. 4, p. 2783, is as follows: "(1)
Speaking generally, a signature is the writing, or otherwise
affixing, a person's name, or a mark to represent his name,
by himself or by his authority ... with the intention of
authenticating a document as being that of, or as binding on,
the person whose name or mark is so written or affixed.
As stated by Romer L.J. in Goodman v. J. Eban Ld.,
([1954] 1 Q.B. 550, 563) that statement appears to be in
accord with ... what Blackburn J. said in Reg. v. Kent
Justices, (L.R. 8 Q.B. 305, 307) namely: "No doubt at
common law, where a person authorizes another to sign for
him, the signature of the person so signing is the signature of
the person authorizing it; nevertheless there may be cases in
which a statute may require personal signature." This state
ment, moreover, was expressly approved by Lord Coleridge
C.J. in France v. Dutton ([18911 2 Q.B. 208, 210). See also
per Lord Esher M.R. in Reg. v. Cowper (24 Q.B.D. 533,
535).
There is much to be said for the view expressed by
Denning L.J. in Goodman v. J. Eban Ld., ([1954] 1 Q.B.
550, 561) where he said, "In modern English usage, when a
document is required to be signed by someone, that means
that he must write his name with his own hand upon it."
This view, however, was not shared by the majority of the
court, who held that a rubber stamp bearing a solicitor's
name, put on with his authority, was a good signature on a
bill of costs. It is true that the question in that case was not
"by whom, but how, the relevant document "must be
`signed,"' but it does show that the old common law rule still
survives.
In view of the foregoing authorities of conclu
sive weight and in view of my conclusion that
Mr. Dubrule authorized Mr. Storrow to sign his
name, there is no question that the signature "F.
J. Dubrule" written by Mr. Storrow is in fact the
signature of Mr. Dubrule.
The next question which follows from this
conclusion is whether Rule 600 makes it manda
tory that a statement of claim must be signed
personally by the person on whom that duty is
cast.
The position taken on behalf of the defendant
was while the Attorney General or Deputy
Attorney General had authorized Mr. Dubrule
to affix the signature of one of them Mr.
Dubrule, in turn, could not delegate that authori
ty to a solicitor in the Tax Litigation Section of
which he is director.
There are many cases which show that when
a discretion to act for a principal is given to an
agent the maxim "Delegates non potest dele-
gare" applies but there are certain well recog
nized exceptions where the authority to delegate
is necessarily implied generally on the ground
that personal attention is not required and the
duty is capable of being equally well discharged
by any person.
In Carltona, Ltd. v. Commissioners of Works
[1943] 2 All E.R. 560 Lord Greene said at page
563:
In the administration of government in this country the
functions which are given to ministers (and constitutionally
properly given to ministers because they are constitutionally
responsible) are functions so multifarious that no minister
could ever personally attend to them. To take the example
of the present case no doubt there have been thousands of
requisitions in this country by individual ministries. It
cannot be supposed that this regulation meant that, in each
case, the minister in person should direct his mind to the
matter. The duties imposed upon ministers and the powers
given to ministers are normally exercised under the authori
ty of the ministers by responsible officials of the depart
ment. Public business could not be carried on if that were
not the case. Constitutionally, the decision of such an offi
cial is, of course, the decision of the minister. The minister
is responsible. It is he who must answer before Parliament
for anything that his officials have done under his authority,
and, if for an important matter he selected an official of
such junior standing that he could not be expected compe
tently to perform the work, the minister would have to
answer for that in Parliament. The whole system of depart
mental organisation and administration is based on the view
that ministers, being responsible to Parliament, will see that
important duties are committed to experienced officials. If
they do not do that, Parliament is the place where complaint
must be made against them.
In Metropolitan Borough and Town Clerk of
Lewisham v. Roberts [1949] 1 All E.R. 815,
Bucknill L.J. said at page 821:
After quoting from the judgment of Lord Greene M.R. in
Carltona, Ltd. v. Works Comrs. ([1943] 2 All E.R. 560) the
learned county court judge continued:
... applying these considerations to the present case, I am
unable to say that the evidence shows that Mr. O'Gara in
purporting to sanction on behalf of the Minister the requisi
tioning of property, and in particular in issuing the document
of Nov. 12, 1946, was acting without authority to do so. On
the contrary, the presumption being that ministerial acts will
be performed, not by the Minister in person, but by respon
sible officials in his department, I think where such acts of
an, official nature, all of them involving the knowledge and
some of them requiring and receiving the concurrence of
other officials, have, as here, continued over a long period,
this of itself affords cogent evidence that the person in fact
acting in such an official capacity was duly authorised to
act.
Lord Denning said at page 824:
... I take it to be quite plain that when a Minister is
entrusted with administrative, as distinct from legislative,
functions he is entitled to act by any authorised official of
his department.
The matter was dealt with by Jenkins J. at
page 828 in the following language:
The validity of the delegation which Mr. O'Gara purport
ed by this letter to effect on behalf of the Minister was
further attacked on the ground that, even if he was, in fact,
authorised by the Minister to effect such delegations in the
sense that the duties entrusted to him in terms extended to
the making of such delegations, he could only be so autho
rised as a delegate of the Minister's powers with the result
that as a matter of law he could not himself validly effect
any further delegations, in view of the well-known principle
of delegatus non potest delegare. I think this contention is
based on a misconception of the relationship between a
Minister and the officials in his department. A Minister must
perforce, from the necessity of the case, act through his
departmental officials, and where, as in the Defence Regula
tions now under consideration, functions are expressed to
be committed to a Minister, those functions must, as a
matter of necessary implication, be exercisable by the Min
ister either personally or through his departmental officials,
and acts done in exercise of those functions are equally acts
of the Minister whether they are done by him personally, or
through his departmental officials, as in practice except in
matters of the very first importance they almost invariably
would be done. No question of agency or delegation as
between the Minister and Mr. O'Gara seems to me to arise
at all. I think this view is borne out by the observations of
Lord, Greene M.R., in Caritona, Ltd. v. Commissioners of
Works... .
On the authority of the foregoing cases, Noël
J. (as he then was) said in Gamache v. Jones
[1968] 1 Ex.C.R. 345 at pages 369-70:
... I do not believe that the principle of delegatus non
potest delegare applies to the present instance where the
Pilotage Authority happens to be the Minister of Transport.
It does not apply because the act done by a departmental
official such as here is equally the act of the authority and
the departmental official has the power to act as if the
authority had done it personally.
In Rule 600 it is recognized that the signature
by the Attorney General or Deputy Attorney
General may be affixed on their behalf.
The Attorney General is charged with the
regulation and conduct of all litigation for and
against the Crown but it is inconceivable that he
should personally do so.
Accordingly it is my view that the Minister or
his deputy are not required to personally super
vise such litigation for the reasons indicated and
that the duties may be equally well discharged
by other qualified persons. That being so the
maxim delegates non potest delegare does not
apply and authority to delegate is implicit.
It is not so much a question of sub-delegation
as it is whether Mr. Dubrule must personally
sign his name. In view of the fact that other
persons are capable of approving a statement of
claim it follows that Mr. Dubrule's personal
attention is not required to be authenticated by
the act of his personal signature. Therefore on
the basis of long standing authority Mr.
Dubrule's signature written by Mr. Storrow
remains Mr. Dubrule's signature.
It seems to me that the question of sub-dele
gation would arise if Mr. Dubrule, who is
authorized to affix the signature of the Deputy
Attorney General, purported to authorize Mr.
Storrow to affix the signature of the Deputy
Attorney General assuming that Mr. Storrow
was not otherwise authorized to do so.
On the other hand if Mr. Storrow was pos
sessed of authority to affix the signature of the
Deputy Attorney General (there was no evi
dence before me on this point) then I think it
would have been better practice for him to have
written his own name rather than Mr. Dubrule's.
But he wrote Mr. Dubrule's name. I should
have thought, as Lord Denning expressed it in
London County Council (supra) case, that it
would have been preferable that Mr. Storrow
having written Mr. Dubrule's name should next
have written the letters "p.p." then written his
own name or initials.
However he did not do so and as I have said
before the fact that Mr. Storrow signed Mr.
Dubrule's name does not detract, in the circum
stance here present, from that being the signa
ture of Mr. Dubrule.
For these reasons the third ground of objec
tion to the statement of claim must also fail.
During the course of the oral argument coun
sel for the defendant maintained that the name
"D. S. Maxwell" should not have been typed
but should have been manually written by
whomsoever was authorized to affix Mr. Max-
well's signature or that that person should have
affixed a facsimile of Mr. Maxwell's signature
by means of a rubber stamp.
I have no doubt that the suggestion of the use
of a rubber stamp was inspired by the decision
in Goodman v. J. Eban Ld. [1954] 1 Q.B. 550,
often referred to as "the rubber stamp case",
which held that a rubber stamp bearing a name
put on a document with the person's authority is
the signature of that person for some purposes.
Counsel's suggestion, as I recall it, was that
Mr. Dubrule or Mr. Storrow could have used
such a stamp bearing Mr. Maxwell's name, or
have written Mr. Maxwell's name manually, but
that the typewritten name could not be an affix
ing of Mr. Maxwell's signature.
It was for this reason that, on the request of
counsel for the defendant, I gave leave to coun
sel for the Crown, to produce an affidavit for
the purpose of showing who typed the name D.
S. Maxwell on the statement of claim. The
affidavit of Kathleen S. Landry establishes that
she was the secretary who did so.
I do not agree with this contention by the
defendant.
In the Interpretation Act, R.S.C. 1970, c. I-23
"writing" is defined in section 28 as follows:
"writing", or any term of like import, includes words print
ed, typewritten, painted, engraved, lithographed, photo
graphed, or represented or reproduced by any mode of
representing or reproducing words in visible form;
Stroud's Judicial Dictionary defines "Signed;
signature" as follows:
(1) Speaking generally, a signature is the writing, or other
wise affixing, a person's name, or a mark to represent his
name, by himself or by his authority ... with the intention
of authenticating a document as being that of, or as binding
on, the person whose name or mark is so written or affixed.
If the typewritten name "D. S. Maxwell" is
not "writing" (as I think it is) it is most certainly
a mechanical method of affixing and I cannot
distinguish in principle an affixing by keys strik
ing a ribbon from a rubber stamp with ink on it.
I assume that counsel's point was that it was
Mrs. Landry who affixed Mr. Maxwell's name
which entailed a still further delegation by Mr.
Dubrule.
In Regina v. Welsford [1967] 2 O.R. 496,
McGillivray said at p. 497:
There have been many cases where the courts have held
that a legislative requirement for a signature did not neces
sarily require a signature be in the handwriting of the person
signing. In particular instances, typed names, stamped
names or a man's mark have been accepted.
In my view, the typed symbols, "D. S. Max-
well" when authenticated by the subscription of
Mr. Dubrule's signature by Mr. Storrow,
became the signature of the Deputy Attorney
General of Canada.
The motion is dismissed with costs in the
cause.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.