BETWEEN:
and
Heard at Toronto, Ontario, on March 20, 2007.
Judgment delivered from the Bench at Toronto, Ontario, on March 20, 2007.
REASONS FOR JUDGMENT OF THE COURT BY: EVANS J.A.
Docket: A-311-06
Citation: 2007 FCA 114
CORAM: DÉCARY J.A.
SEXTON J.A.
EVANS J.A.
BETWEEN:
LJP SALES AGENCY INC.
Appellant
and
MINISTER OF NATIONAL REVENUE
Respondent
REASONS FOR JUDGMENT OF THE COURT
(Delivered from the Bench at Toronto, Ontario, on March 20, 2007)
[1] This is an appeal by LJP Sales Agency Inc. (“LJP”) from a decision by Justice Mactavish of the Federal Court dismissing an appeal from an order of Prothonotary Milczynski, dated October 25, 2005, granting a motion by the Minister of National Revenue to strike LJP’s application for judicial review on the ground that it was bereft of any possibility of success. The Motions Judge’s decision is reported as LJP Sales Agency Inc. v. Canada (Minister of National Revenue), 2006 FC 735.
[2] In its application for judicial review, LJP requested an order of mandamus to require the Minister to reassess its tax liability for the taxation years 1998 and 1999, on the basis that it was not associated with Jo-Van Distributors Inc. and was entitled to a small business tax deduction. LJP based its claim to be reassessed on a decision of the Tax Court of Canada, dated December 1, 2003, that the Minister had erred in refusing it a small business tax deduction for the years 1995, 1996 and 1997 because it was associated with Jo-Van Distributors.
[3] The Minister reassessed the taxation years 1996, 1996 and 1997 in accordance with the Court’s decision. However, he refused LJP’s request to reassess the taxation years 1998 and 1999: the assessments had been made in 2001, LJP had filed no notice of objection or waiver and the time for so doing had expired, and the exception for out-of-time reassessments in subsection 152(4.3) of the Income Tax Act, R.S.C. 1985 (5th Supp.), c. 1, did not apply.
[4] The Motions Judge held that the Minister’s motion to strike was not inappropriate, since LJP’s application for judicial review depended on a question of statutory interpretation which did not require evidence of facts in addition to those in the notice of application. She further held that the facts relied on by LJP, which she assumed for the purpose of the motion to be true, were materially indistinguishable from those in Sherway Centre Inc. v. Canada, 2003 FCA 26.
[5] It was held in Sherway Centre that the Minister has a duty or power under subsection 152(4.3) to reassess beyond the normal limitation period only when the reassessment is reasonably related to a change in the taxpayer’s numerical balance in a previous taxation year as a result of a decision on appeal, not to a change in the principles on which the computation was based.
[6] In the present case, LJP based its request for a reassessment for the years 1998 and 1999 on the Tax Court’s decision permitting it a small business tax deduction in the taxation years 1995, 1996 and 1997, because, contrary to the Minister’s view, it was held not to be associated in those years with Jo-Van Distributors. In these circumstances, LJP said that it was entitled to the small business tax exemption for the taxation years 1998 and 1999 as well.
[7] The Motions Judge concluded that, as a result of the interpretation of subsection 152(4.3) in Sherway Centre, LJP’s application for judicial review was bereft of all possibility of success and had been properly struck by the Prothonotary. We are not persuaded that the Motions Judge committed any reviewable error in reaching her decision.
[8] First, the Minister’s motion to strike was not inappropriate, even though, as this Court held in David Bull Laboratories (Canada) Inc. v. Pharmacia Inc. (1994), 58 C.P.R. (3d) 209 (F.C.A.), motions to strike applications for judicial review should only be brought in exceptional circumstances because of the summary nature of the proceedings. However, the presence of an authority which is directly contrary to the position on which an application is based can be such an exceptional circumstance, when no further development of the factual record is required.
[9] Second, counsel submits that Sherway Centre was wrongly decided and that the Judge hearing the application for judicial review, and this Court on appeal, should reconsider it. We disagree. In the interests of certainty and judicial economy, this Court will usually not reconsider its own decisions: Miller v. Canada (Attorney General), 2002 FCA 370. In light of this general principle, and its exceptions, we are not persuaded that there is any basis for reconsidering Sherway Centre in this case.
[10] For these reasons, the appeal will be dismissed with costs.
FEDERAL COURT OF APPEAL
NAMES OF COUNSEL AND SOLICITORS OF RECORD
STYLE OF CAUSE: LJP SALES AGENCY INC. v MINISTER OF NATIONAL REVENUE
DATE OF HEARING: MARCH 20, 2007
PLACE OF HEARING: TORONTO, ONTARIO
OF THE COURT BY: (DÉCARY, SEXTON & EVANS JJ.A.)
DELIVERED FROM THE
BENCH BY: EVANS J.A.
APPEARANCES:
Thomas McRae FOR THE APPELLANT
Marie -Therese Boris FOR THE RESPONDENT
SOLICITORS OF RECORD:
Shibley Righton LLP
Toronto, Ontario FOR THE APPELLANT
John H. Sims, Q.C.
Deputy Attorney General of Canada FOR THE RESPONDENT