INCOME TAX
Practice
Judicial review of decision of Minister of National Revenue (Minister) to issue notice of intention effective January 1, 1996, to revoke registration of pension plan established by Cryptic Web Information Technology Security Inc.— Applicant seeking order quashing Minister’s decision or prohibiting Minister from revoking plan retroactively to date earlier than date of notice of intention to revoke (October 16, 2003)—Shortly after commencing judicial review application, applicant filing notice of motion seeking certain interlocutory orders—Respondent (Crown) contesting motions, seeking to quash applicant’s application on basis Court lacking jurisdiction to hear it—Applicant former federal government employee, contributor to public service superannuation plan maintained for federal government employees—In 1999‑2000, applicant worked for Cryptic Web, became member of Cryptic Web pension plan—Cryptic Web’s pension plan registered effective January 1, 1996—‑ In 1999, federal government employee who moved to private sector employment permitted to have money transferred from public service superannuation plan to registered pension plan maintained by or for new employer—Applicant’s pension funds transferred to Cryptic Web’s pension plan—After 2000, money so transferred transferred to another registered pension plan—On October 16, 2003, Minister notifying Cryptic Web of intention to revoke registration of pension plan, effective January 1, 1996, under Income Tax Act (Act), s. 147.1(11)(a), (j) as condition of registration (i.e. members of pension plan not employees as required) not met—Cryptic Web appealed Minister’s notice under Act, s. 172(3)(f)—Applicant sought leave to intervene in Cryptic Web’s appeal but motion dismissed “for prematurity”—Because motion not dismissed on merits, applicant retaining right to reapply to intervene in appeal if appeal proceeding—Cryptic Web’s appeal in abeyance— Members of pension plan could face greater tax burden if registration revoked retroactively—Federal Courts Act giving Federal Court of Appeal jurisdiction to hear, determine applications for judicial review of specified decisions of federal boards, commissions, tribunals—No direct recourse to Court for decisions of Minister of National Revenue except as provided by Income Tax Act (s. 172(3))—Income Tax Act one of federal statutes giving Federal Court of Appeal jurisdiction over matters not within scope of Federal Courts Act—Income Tax Act, s. 172(3)(f) providing for right of appeal from Minister’s decision to issue notice of intention to revoke registration of pension plan—However, right of appeal only given to administrator of pension plan, participating employers—Not given to members of plan—Statutory scheme of revocation of registration of pension plans contemplating two kinds of notices to be given by Minister to plan’s administrator: (1) notice of intention to revoke under Act, s. 147.1(11); (2) notice of revocation under Act, s. 147.1(12) —Notice of intention to revoke must specify reason for proposed revocation, proposed effective date for revocation— Notice triggers statutory right of appeal under Act, s. 172(3)(f)—Also marks beginning of 30‑day period after which Minister may issue notice of revocation, whether appeal under Act, s. 172(3) commenced or not—Notice of revocation instrument by which registration of pension plan revoked— Must specify effective date for revocation—If notice of revocation issued after notice of intent issued, effective date specified may be any date not earlier than proposed effective date specified in notice of intent—Act, s. 147.1(13) providing registration of pension plan revoked as of effective date specified on notice of revocation “unless Court . . . on applica-tion made at any time before determination of appeal . . . orders otherwise”—Unclear about kind of order contem-plated, individual entitled to make application thereunder, when application may be made—S. 147.1(13) providing that application made thereunder must be made before disposition of any appeal under s. 172(3)—Limitation in s. 147.1(13) that only administrator of registered pension plan or participating employer may exercise right of appeal under s. 172(3) when Minister issues notice of intent to revoke registration of plan not expressed in relation to applications made under s. 147.1(13) when Minister issuing notice of revocation—Since adverse tax consequences of revocation falling mainly on members, not unreasonable to assume s. 147.1(13) intended to provide judicial recourse to members of pension plan proposed to be revoked—Two legal effects of s. 147.1(13): revocation of pension plan, effective date of revocation—If application meeting statutory requirements, s. 147.1(13) giving Court jurisdiction to alter effective date of revocation; suspend or stay revocation pending disposition of s. 172(3) appeal—Interpreting s. 147.1(13) to permit only suspension or stay of revocation would preclude possibility, even in case where appeal made under s. 172(3), that s. 147.1(13) may be used to seek order imposing different effective date for revocation than date set out in notice of revocation—No policy reason why s. 147.1(13) would preclude Court’s jurisdiction, in case of voluntary or involuntary revocation, to make order altering effective date of revocation stated in notice of revocation; to make order suspending or staying revocation pending determination s. 172(3) of appeal if appeal pending—Court’s jurisdiction would require application that meets conditions in s. 147.1(13)—S. 147.1(13) not limiting recourse thereto to persons having right of appeal under s. 172(3) (plan administrators, participating employers)— Members of pension plan having most at stake in resolution of any dispute about choice of effective date—If s. 147.1(13) not entitling members of pension plan to challenge effective date of revocation of registration of pension plan, then Minister’s decision to issue notice of revocation may be within exclusive original jurisdiction of Federal Court under Federal Courts Act—If Federal Court having jurisdiction in matter, both Federal Court, Federal Court of Appeal could be required to adjudicate same point with potentially inconsistent results— Therefore, persons capable of demonstrating real, substantial interest in revocation of registration of pension plan have status to bring application under s. 147.1(13)—Application made thereunder cannot be made before Minister issues notice of revocation—However, s. 147.1(13) not precluding commencement of application in respect of pension plan for which notice of revocation not yet issued but for which notice of intent under appeal issued—Court cannot make order under s. 147.1(13) unless application made under s. 147.1(13) before determination of appeal under s. 172(3)—If order to be made before appeal determined, it must be possible to apply for order while appeal pending—Therefore, applicant having status to bring application, Court having jurisdiction to grant order but application cannot be determined unless and until notice of revocation issued—Application stayed—Income Tax Act, R.S.C., 1985, c. 1 (5th Supp.), ss. 147.1 (as am. by S.C. 1990, c. 35, s. 16; 1994, c. 7, Sch. II, s. 120(F); Sch. VIII, s. 85; 1996, c. 21, s. 36; 1997, c. 25, s. 44; 1998, c. 19, ss. 39, 173; 2003, c. 15, s. 84; 2005, c. 30, s. 11), 172(3)(f) (as am. by S.C. 1990, c. 35, s. 18; 1994, c. 7, Sch. II, s. 141; 1998, c. 19, s. 46; 2001, c. 41, ss. 115, 127; 2005, c. 19, s. 39)— Federal Courts Act, R.S.C., 1985, c. F‑7, s. 1 (as am. by S.C. 2002, c. 8, s. 14).
Boudreau v. M.N.R. (A‑248‑05, 2005 FCA 304, Sharlow J.A., order dated 20/9/05, 27 pp.)