Tax - Income Tax - Administration and enforcement
In taxpayer’s appeals from reassessments, his request to conduct late discoveries and adjourn appeal hearing was granted with costs of $7,500 awarded to Minister . In status report to Tax Court of Canada, Minister advised that discoveries were not complete and that taxpayer had not paid this outstanding costs award, taking position that appeals that should not be set down for trial until after completion of discoveries. Tax Court issued order requiring taxpayer to pay outstanding costs award by deadline or face automatic dismissal of appeals without further notice or formality and, as taxpayer failed to pay amount owing by deadline, appeals were automatically dismissed. Taxpayer’s motion for stay of proceedings pending appeal of order was dismissed on basis that there was nothing to stay. Taxpayer appealed from order and dismissal of motion. Appeal allowed in part. Only reason provided for term for conditional dismissal of appeals was recital that taxpayer had failed to comply with costs award. Term was drastic step for Court to take, resulting in dismissal without appeal being heard on merits, and it was doubtful that it was warranted . Relief was issued on Tax Court’s own initiative with parties provided no opportunity to make submissions on its terms. This process breached principle of natural justice, that included right to be heard, that warranted appellate intervention. There was no reason to intervene in dismissal of motion, as Tax Court correctly concluded that there were no proceedings to stay after automatic dismissal of appeals. Many of taxpayer’s submissions were focused on very high costs award, fixed without parties’ submissions and despite lack of Minister’s opposition to taxpayer’s request, but he did not appeal that award and so it was not before court.
Kibalian v. Canada (2019), 2019 CarswellNat 2119, 2019 FCA 160, M. Nadon J.A., Wyman W. Webb J.A., and Judith Woods J.A. (F.C.A.).
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