Date: 20020125
Docket: 2000-831-IT-I
BETWEEN:
SHEILA ANANTHAN,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
Reasonsfor Taxation
Tanasychuk, T.O., T.C.C.
[1] This taxation came on for hearing on October 2, 2001, by means of a telephone conference call. It follows an Amended Judgment of the Honourable Judge Teskey dated April 23, 2001 wherein the appeal from the assessment made under the Income Tax Act for the 1996 taxation year was allowed, with costs. The Appellant represented herself and Ms. Jocelyn Espejo Clarke represented the Respondent.
[2] The Bill of Costs as submitted by the Appellant is as follows:
This is my bill of costs in the above appeal.
A. For services of counsel I claim the following:
(a) preparation of notice of appeal, $
(b) preparation of hearing, $1,186.64
(see attached invoice from Solicitor Sondra O. Gibbons)
(c) conducting the hearing,
# of half days = _____________ $
B. For witnesses, fees I claim the following: $
C. For expert witnesses I claim the following: $
D. Other disbursements (See Schedule A
attached) $2,321.12
[3] The claim for other disbursements of $2,321.12, was itemized on a separate Schedule, as follows:
Unpaid leave to prepare for appeal: 5 days x 7.5 hours = 37.5 hours
Includes time to contact lawyer, photocopy, research etc.
Unpaid leave for court appearances: 3 days x 5 hours = 15.0 hours
52.5 hours
x $32.47/hr.
NOTE: $2,435.76 gross pay/75 hours $1,704.67
Child care 8 days x $55.00 = 440.00
Photocopying (no receipts available)
257 pages at $0.10 = 25.70
Mileage to make appearances at Tax Court:
June 26, 20000 (to Tax Court) 45 km.
(return) 45 km.
January 22, 2000 (to Tax Court) 45 km.
(return) 45 km.
March 30, 2001 45 km.
(return) 45 km.
270 km. X $0.425 = 114.75
Note: Rate used is the rate I receive from CCRA for travel
Parking:
June 26, 2000 $12.00
January 22, 2001 12.00
March 30, 2001 12.00
$36.00 $ 36.00
TOTAL $2,321.12
[4] Item A.(b) is a claim for preparation of hearing totalling $1,186.64. The document submitted in support of this claim was an account from a lawyer, Sondra O. Gibbons, comprised of legal fees of $862.50 plus $60.38 for GST and disbursements of $246.50 plus $17.26 for GST. At the outset, both parties confirmed that there was no dispute as to the disbursements and GST totalling $263.76, from Ms. Gibbons' account. Based on the agreement of the parties, I will allow the sum of $263.76. The remaining amounts from Ms. Gibbons' account of $862.50 for fees plus $60.38 for GST are in dispute.
[5] The next item is a claim for disbursements of $2,321.12, as set out on a separate Schedule. The parties advised that they had reached agreement on three of the items claimed on the Schedule of disbursements as follows:
Photocopies $ 25.70
Mileage 114.75
Parking 36.00
TOTAL $176.45
Accordingly, I will allow the sum of $176.45 for photocopies, mileage and parking. The remaining amounts of $1,7604.67 for unpaid leave and child care expenses of $440.00 from the Schedule of disbursements are in dispute.
SUBMISSIONS BY MS. ANANTHAN:
[6] The first item Ms. Ananthan dealt with was the claim for services of counsel for preparation for hearing in the amount of $862.50 for fees plus $60.38 for GST, as set out in the account from Ms. Sondra Gibbons. Ms. Ananthan stated that the hearing of her appeal commenced on January 22, 2001. After she commenced giving her evidence, the hearing was adjourned to March 30, 2001, to enable her to obtain documents necessary to prove her case and to arrange for the attendance of her lawyer.
[7] Ms. Ananthan's recollection was that the presiding Judge recommended that she arrange for the attendance of her lawyer and that the legal fees she is now seeking to recover were incurred as a result of her acting on the Judge's recommendation. She further stated that the fees incurred were direct costs of successfully prosecuting her appeal.
[8] Ms. Ananthan's claim for unpaid leave represents time she spent preparing her notice of appeal, preparing for the hearing and attending in Court. She was required to take time off work, as a result of a decision made by Canada Customs and Revenue Agency, which she successfully challenged in the Tax Court of Canada.
[9] Ms. Ananthan stated that she has four children, between the ages of two and eight years. She incurred child care expenses over a period of eight days while preparing her notice of appeal, preparing for hearing and attending in Court.
SUBMISSIONS BY MS. ESPEJO CLARKE:
[10] With respect to the claim for reimbursement of Ms. Gibbons' account for legal fees, Ms. Espejo Clarke stated that the Appellant represented herself and was not represented by a lawyer. As such, legal fees are not recoverable. Further, there was no order made by the Court compelling the attendance of her lawyer, but only a suggestion.
[11] Ms. Espejo Clarke admitted that Ms. Gibbons was in attendance in Court on March 30, 2001, but did not give evidence. It is her position that the Appellant is not entitled to recover anything on account of legal fees charged by Ms. Gibbons.
[12] With respect to the claim for unpaid leave, Ms. Espejo Clarke stated that the income lost from employment is not reimbursable. In support of this position, she referred to Stacey v. R., [2000] 2 C.T.C. 2677, Scarlett v. R., [1999] 1 C.T.C. 2295 and Tippet v R., [1996] G.S.T.C. 74.
[13] Ms. Espejo Clark's position is that the child care expenses are not recoverable on a taxation, as these costs are personal in nature and should not be borne by the Respondent.
REPLY BY MS. ANANTHAN:
[14] With respect to the lawyer's fees, Ms. Ananthan responded that her claim for recovery of this amount falls within section 12(3), which reads as follows:
such other disbursements may be allowed as were essential for the conduct of the appeal, if it is established that the disbursements were made or that the party is liable for them.
It is her position that she would not have been successful, had she not incurred these costs and that they were therefore essential for the conduct of the appeal.
[15] Miss Ananthan believes that her claim for unpaid leave is distinguishable from the Scarlett (supra) decision. Ms. Ananthan stated that Ms. Scarlett's claim was for loss of income from a business. Ms. Ananthan stated that she is employed and receives a fixed income. As a result, her claim for unpaid leave can be accurately quantified.
DECISION:
[16] With respect to the claim for the lawyer's fees, they are not recoverable under Rule 11, as the Appellant represented herself in this matter. I must then consider the Appellant's submission that the fees are recoverable under Rule 12(3).
[17] I have reviewed the transcript from the proceedings of January 22, 2001, a copy of which was provided to the Appellant and myself by Ms. Espejo Clarke. Prior to the commencement of the hearing, The Honourable Judge Teskey advised the Appellant that he would grant her an adjournment, if she did not have all necessary documents with her. His Honour outlined what those documents were. Notwithstanding those comments, the Appellant chose to proceed. During the course of her testimony, it became obvious that she did not have all of the documents required to prove her case. Upon attempting to file a letter prepared by her lawyer as an exhibit, the Court adjourned the hearing to a later date, to enable the Appellant to obtain necessary documents and to secure the attendance of witnesses, if required. The Court issued an Order fixing a date for the continuation of the hearing. There was no Order issued compelling the attendance of witnesses.
[18] Ms. Gibbons' account is for services performed that relate to preparation for hearing and attendance at hearing. Had counsel represented the Appellant, Rule 11 permits the allowance of $200.00 for preparation for hearing and $300.00 per half day for the conduct of a hearing. It is interesting to note that Ms. Gibbons' invoice exceeds the amounts allowable for the services of counsel for preparation and attending at hearing, pursuant to Rule 11.
[19] While there is no doubt that Ms. Gibbons prepared document briefs for the Appellant's use at hearing and was in attendance in Court on March 30, 2001, the fees charged by Ms. Gibbons are not recoverable under Rule 12(3). What the Appellant is attempting to do is re-characterize the fees charged by her lawyer for preparation and attendance at hearing and recover them as a disbursement under Rule 12(3). Accordingly, the amount of $863.50 for fees plus $60.38 for GST totalling $922.88 is taxed off.
[20] The next outstanding item is a claim for unpaid leave of $1,704.67. In Tippett (supra) the Appellant's claim for lost wages was disallowed on a taxation of costs before the Registrar of the Tax Court of Canada. That decision was appealed, and the Honourable Judge Rip upheld the decision. In his review of the Registrar's decision, the Honourable Judge Rip stated:
Costs do not include loss of income from employment during litigation.
I agree with The Honourable Judge Rip's decision. An Appellant's claim to recover lost wages as a result of preparation and attendance at hearing is not recoverable on a taxation of costs. When the Appellant filed the notice of appeal, she undertook to do so, at her own expense. Accordingly, I will tax off the full amount claimed for lost wages of $1,704.67.
[21] The last outstanding item is the claim for $440.00 for child care. There is no provision in the Rules to permit the allowance of a claim for child care expenses. I agree with Ms. Espejo Clarke's submission that this is a personal expense, the cost of which should not be borne by the Respondent. I will accordingly tax off the amount claimed of $440.00.
[22] The Bill of Costs of the Appellant in the amount of $3,507.76 is taxed and the amount agreed upon by the parties of $440.21 is allowed. A certificate will be issued.
Dated at Toronto, Ontario, this 25th day of January 2002.
"B.G. Tanasychuk"
Taxing Officer