77-T-625
In re Jung and in re section 223 of the Income
Tax Act
Trial Division, Cattanach J.—Ottawa, October 3
and 24, 1977.
Practice — Refusal of Court to register Minister's certifi
cate produced for registration under s. 223 of Income Tax Act
— Improper form — If proper form, whether registration
mandatory or whether person to be given opportunity to
oppose registration — Whether proof of conditions precedent
to registration to be presented at registration — Income Tax
Act, S.C. 1970-71-72, c. 63, s. 223.
This is an ex parte notice of motion by the Minister of
National Revenue for directions as to the registration of a
certificate produced pursuant to section 223 of the Income Tax
Act. The certificate tendered had been refused by the Adminis
trator of the Court because of the decision in The Queen v. Star
Treck Holdings Ltd. concerning the form of the certificate.
Other substantive issues arose for consideration. Was it manda
tory that a certificate in proper form be registered or was the
person affected to be first afforded the opportunity of opposing
the registration? Further, when a proper certificate is produced
for registration, must that certificate be accompanied by proof
that the conditions precedent to the Minister's author
ity exist?
Held, the certificate in present form is not registrable. The
inclusion of a style of cause appropriate to a style of cause in a
statement of claim and language implying that the document is
one issued by the Court rather than merely a certificate made
by the Minister or an officer of the Department authorized to
do so, is inaccurate and misleading so as to constitute justifica
tion for the rejection of a certificate in such form when
produced for registration. On production under section 223(2)
of a certificate in proper form, registration is mandatory. It is
to be presumed that the prerequisites to the making of the
certificate by the Minister have been complied with and on its
face the certificate is to be taken as rightly made and accord
ingly shall be accepted for registration on production subject
always to that presumption being rebutted by the person
adversely affected in a subsequent hearing.
R. v. Star Treck Holdings Ltd. [1978] 1 F.C. 61, applied.
NOTICE of motion.
COUNSEL:
E. Bowie for Minister of National Revenue.
SOLICITORS:
Deputy Attorney General of Canada for Min
ister of National Revenue.
The following are the reasons for judgment
rendered in English by
CATTANACH J.: This is an ex parte notice of
motion by the Minister of National Revenue for
directions as to the registration of the certificate
mentioned in the above style which had been
refused when tendered for registration by the
Administrator of the Court no doubt as the conse
quence of a decision by myself in The Queen v.
Star Treck Holdings Ltd.'
In the Star Treck matter an application was
made to correct an error in a certificate by the
Minister produced under section 223 of the
Income Tax Act which had been registered.
This I refused to do for the reason that the
certificate is not a judgment nor does it become a
judgment of this Court when registered but rather
it remains what it always has been and that is
merely a certificate of the Minister even though
section 223 of the Income Tax Act provides that
when such a certificate is registered it has the
same force and effect, and all proceedings may be
taken thereon as if the certificate were a judgment
obtained in this Court.
That being so there was no Rule of the Federal
Court nor any provision in the Income Tax Act
which authorizes a judge of this Court to direct
the correction of an error in a certificate which
had been registered. That was the ratio decidendi.
However I did continue to say that when the
Minister, and the officers of his Department, to
whom he is authorized to delegate his responsibili
ty in these respects, are armed with such extraordi
nary powers it is incumbent upon them to be
cautious and accurate in exercising the powers so
bestowed upon them.
I continued to further say that the form of
certificate in use, and the same applies to the
certificate now under consideration, is fraught
with inaccuracies.
Without attempting to be all-inclusive I pointed
out that the certificates recite a style of cause as
' [1978] 1 F.C. 61.
between Her Majesty the Queen, as plaintiff, and
a named person or persons, as defendant or
defendants.
In the certificate presently under consideration
the same inaccuracy occurs. The Queen is named
as plaintiff and Taehoon Jung, 26 Courtwright
Road, of the Borough of Etobicoke, Ontario, is
named as defendant.
In the printed form used, the words "Her
Majesty the Queen" are printed as part of the
form indicative of the degree of permanency in the
practice adopted by the Department with a blank
space provided to permit the typing in of the name
of the person selected to be a defendant.
As I pointed out in the Star Treck matter, there
is no authority in the Income Tax Act, the Federal
Court Act, the Federal Court Rules or elsewhere
for converting what is not an action into an action
nor is it deemed to be an action between the
parties so named.
There is, in fact, no action within the meaning
of that word in that there is no proceeding in the
Trial Division between the parties named and
accordingly to use the form prescribed by the
Federal Court Rules for use in the style of cause
of an action in the Court between parties is grossly
misleading. It confuses the certificate with a pro
ceeding by action and thus represents it to be what
in fact it is not.
Furthermore the form of certificate contains in
prominent printed block capital letters at its very
beginning the words, "IN THE FEDERAL
COURT OF CANADA" followed by the words,
"TRIAL DIVISION" in smaller type capital letters
and are preceded by the words, "COURT NO." with
space for an assigned Court number for an action.
This is not a document issued by the Court. It is
a certificate prepared by the Minister or his offi
cers to whom authority is delegated to do so. On
registration the certificate becomes available for
public inspection. The manner in which the docu
ment is printed gives the appearance that it was
deliberately designed to convey to the unwary or
uninitiated to whose attention it might come, the
impression that it is a document which emanates
from the Court. This is wrong. There is no statute
or Rule which authorizes the Minister or any
officer of his Department to issue documents in the
name of the Court.
Furthermore the certificate is prepared to be
manually signed over the printed title, "Director,
Collection Division, Department of National Reve
nue, Taxation". The holder of that office is obvi
ously an officer of the Department and is not an
officer of this Court authorized to sign such a
document in such capacity.
As I said in the Star Treck matter the use of the
words, "IN THE FEDERAL COURT OF
CANADA", displayed with such prominence,
should be discontinued. I also said that the certifi
cate by the Minister should be directed, "TO THE
FEDERAL COURT OF CANADA" and the
appropriate Division of the Court. On reflection I
do not think it needs to be directed to anyone, but
if it is to be directed to anyone it should be to the
Court.
It is quite obvious what the draftsman of the
form of the certificate did. He adapted the styles
appearing in Forms 1 and 2 in the Appendix to the
Federal Court Rules. These forms prescribe the
appropriate court title by division and the style of
cause to appear upon a statement of claim.
Because there is no cause of action and no
statement of claim in these matters the adoption of
those forms is not analogous and is most inept.
Counsel for the Minister agreed that the criti
cisms I have made of the form of the certificate in
use, in these two particulars, are well-founded.
I did not decide in the Star Treck matter that
the registration of a certificate prepared in such
form was rendered invalid thereby. However I did
say that the form of the certificate was inappropri
ate, grossly misleading and inaccurate. In the Star
Treck matter I made suggestions as to the proper
form to be adopted in respect of the two particu
lars above mentioned with which counsel for the
Minister also agreed. It follows that these factors,
standing alone, are sufficient justification for
refusing to direct the Administrator to accept the
certificate produced for registration in its present
form.
While this conclusion disposes of the present
application so long as the certificate is produced
for registration without amendment, as indicated
above, there still remains for determination a far
more crucial issue and that is when the certificate,
amended as I have indicated, is produced for
registration whether it is mandatory that the cer
tificate be registered and the consequences thereby
follow automatically or whether the person
adversely affected thereby must first be afforded
the opportunity of opposing the registration at this
point in time.
The Federal Court Rules are silent upon the
matter.
If the person adversely affected has the right to
oppose the registration it follows that under the
Rules as they presently read the application for
registration must be by way of a notice of motion
supported by an appropriate affidavit establishing
that all conditions precedent to registration have
been complied with and the opposite party may
cross-examine on the affidavit filed in support of
the motion and file an affidavit in reply.
It would appear that with respect to the regis
tration of the Minister's certificates under section
223 of the Income Tax Act, assuming always that
there must be a notice of motion as a condition to
registration, the appropriate procedure would be
by way of an originating notice of motion under
Rule 304(1) which by virtue of that Rule must be
served personally on the interested person and in
that event I entertain doubt if resort might be had
to Rule 324 to dispose of the matter without
personal appearance on the basis of written
representations.
Section 223 reads:
223. (1) An amount payable under this Act that has not
been paid or such part of an amount payable under this Act as
has not been paid may be certified by the Minister
(a) where there has been a direction by the Minister under
subsection 158(2), forthwith after such direction, and
(b) otherwise, upon the expiration of 30 days after the
default.
(2) On production to the Federal Court of Canada, a certifi
cate made under this section shall be registered in the Court
and when registered has the same force and effect, and all
proceedings may be taken thereon, as if the certificate were a
judgment obtained in the said Court for a debt of the amount
specified in the certificate plus interest to the day of payment
as provided for in this Act.
(3) All reasonable costs and charges attendant upon the
registration of the certificate are recoverable in like manner as
if they had been certified and the certificate had been regis
tered under this section.
By virtue of subsection (1) what the Minister is
to certify is the amount expressed in terms of
money that is payable under the Income Tax Act
which would be inclusive of all taxes assessed,
interest accumulated thereon in accordance with
the Act, penalties imposed, costs and other like
amounts or such part of the total amount which
has not been paid. This is the certification required
to be made by the Minister. It would follow there
from that other language included in the certifi
cate such as a style of cause and the title of the
Court to which the certificate is to be produced is
a mere surplusage of verbiage and would not affect
the validity of the certificate if the essential
ingredient thereof, that is the amount payable and
not paid, is certified. This does not detract from
my conclusion that the inclusion of a style of cause
appropriate to a style of cause in a statement of
claim and language implying that the document is
one issued by the Court rather than merely a
certificate made by the Minister or an officer of
the Department authorized to do so, is inaccurate
and misleading so as to constitute justification for
the rejection of a certificate in such form when
produced for registration.
However the much more substantive question
arises for consideration and that is, when a proper
certificate is produced for registration, must that
certificate be accompanied by proof that the con
ditions precedent in section 223(1)(a) or (b) to the
Minister's authority to make the certificate exist?
If that be so then I should think that a mere
statement contained in the certificate that a notice
of assessment was mailed to the taxpayer on a
certain day, that 30 days have elapsed from the
day of mailing of the notice of assessment and that
the whole has not been paid or a part remains
unpaid or that the Minister was of the opinion that
the taxpayer was attempting to avoid payment of
taxes and directed that all taxes, penalties and
interest assessed shall be paid forthwith upon
assessment without the grace of 30 days from the
mailing of the notice of assessment, which are the
conditions precedent to the Minister making the
certificate, would not be enough. The proof, if such
is requisite to registration, should be by means of
an affidavit.
My brother Walsh had occasion to consider a
similar problem which arose following the filing
and registration of an order of an arbitration board
pursuant to section 159 of the Canada Labour
Code (R.S.C. 1970, c. L-1 as amended by S.C.
1972, c. 18) in Public Service Alliance of Canada,
Local 660 v. Canadian Broadcasting Corporation
[1976] 2 F.C. 151.
Section 159 reads:
159. (1) Where any person or organization has failed to
comply with any order or decision of an arbitrator or arbitra
tion board, any person or organization affected by the order or
decision may, after fourteen days from the date on which the
order or decision is made, or the date provided in it for
compliance, whichever is the later date, file in the Federal
Court of Canada a copy of the order or decision, exclusive of
the reasons therefor.
(2) On filing in the Federal Court of Canada under subsec
tion (1), an order or decision of an arbitrator or arbitration
board shall be registered in the Court and, when registered, has
the same force and effect, and all proceedings may be taken
thereon, as if the order or decision were a judgment obtained in
the Court.
Mr. Justice Walsh had before him the question
of the validity off the registration of an arbitration
award purporting to be registered with this Court
under section 159.
On behalf of the petitioner it was contended that
under section 159(2) no prior notice to the party
adverse in interest was necessary for registration.
Mr. Justice Walsh held otherwise.
He said that section 159(2) must be read with
section 159(1) which provides that when 14 days
have elapsed from the date of the Board's decision
and the person required to comply with the
Board's order has not done so, then the person in
whose favour the order was given may file in the
Federal Court a copy of the Board's order for
registration.
He continued to say that the failure to comply
with the Board's order was a condition precedent
to filing for registration.
Walsh J. pointed out [at pages 152-1531 that:
Rule 321 of the Federal Court Rules clearly provides that
unless otherwise authorized to be made ex parte motions must
be served on the opposite parties at least 2 clear days before the
hearing, unless this is dispensed with. Rule 319 requires that
the motion shall be supported by an affidavit setting out all the
facts on which the motion is based that do not appear from the
record, and that the adverse party may fife an affidavit in reply,
and that by leave of the Court a witness may be called to testify
in relation to an issue of fact raised by an application.
He went on to say [at page 1531:
While petitioner's motion for inter alla, the registration of
the arbitration award was accompanied by an affidavit setting
out that respondent has not complied entirely with the arbitra
tion award, no details were given as to which conditions were
not complied with, and more important it was not served on the
opposite party before the registration was effected so as to give
the respondent the opportunity to deny, as it does, that the
award was not complied with. This is contrary to Federal Court
Rule 321 and to '' a basic principle of equity audi alteram
partem. The establishment that the arbitration award has not
been complied with is a condition sine qua non of its registra
tion in this Court.
After having annulled and struck out the regis
tration of the Arbitration Board's order, he con
cluded by saying [at page 1531:
It will however be up to the judge heating the motion if same is
presented again, after due service, to decide whether his deci
sion as to whether the award has not been complied with, and
hence can be registered should he made on the basis of affida
vits alone, or after hearing evidence.
In International d,'rotherhood of Electrical
Workers, Local Union 529 v. Central Broadcast
ing Company Ltd. Q[14771 2 F.C. 78) an applica
tion was made before me to have an order of the
Canada Labour Relations Board, which had been
filed unilaterally and subsequently registered on
March 12, 1975 under section 123 of the Canada
Labour Code without notice having been served on
the party affected thereby, to register pursuant to
the motion currently made, service of which notice
of motion to this and other ends having been
served, with retroactive effect to March 12, 1975 if
such re-registration should be required together
with many other requests for relief.
The relief sought in the notice of motion for
registration of the order of the Board with retro
spective effect was inspired by the decision of
Walsh J. in Public Service Alliance of Canada,
Local 660 v. Canadian Broadcasting Corporation
(supra).
Section 123 and section 159 of the Canada
Labour Code are identical in language except for
minor differences dictated by the necessity of the
subject matters and the decision of Walsh J. is an
equally authoritative interpretation of section 123
as it is of section 159.
The issue as to the validity of the filing and
registration of the order of the Board was before
me and on the basis of the decision of my brother
Walsh I held the filing of the order and its subse
quent registration to be a nullity.
I also refused to amend the order of the Board
to fix a time for compliance, to direct the registra
tion of the order pursuant to the request to do so
because the order of the Board was conditional
and not a final order, and because the order was so
inexplicit in other respects that it could not be
determined what was ordered to be done I denied
an order for committal and leave to issue a writ of
sequestration, but in addition to these reasons I
refused the relief sought for the overriding reason
that no order of the Board had been filed and
registered as an order of this Court to enforce.
There are remarkable areas of similarity and
dissimilarity in the purposes and language of sec
tions 123 and 159 of the Canada Labour Code and
section 223 of the Income Tax Act.
Under sections 123 and 159 of the Canada
Labour Code the conditions precedent are a failure
to comply with the order of the Board within
fourteen days. When these conditions exist any
person affected by the Board's order may file a
copy in the Federal Court of Canada. Under sub-
section (1) of section 223 of the Income Tax Act
the Minister may certify that an amount payable
under the Act has not been paid, when there has
been a direction by the Minister under section
158(2) or otherwise upon the expiration of thirty
days after the default.
Counsel for the applicant referred me to the
decision of my brother Mahoney in In re Anishe-
nineo Piminagan Inc. [1978] 1 F.C. 642, presum
ably as authority for the proposition that, by
analogy, section 223 of the Income Tax Act pro
vides a procedure for the registration of the Minis
ter's certificate in the Federal Court.
If that was the purpose for the decision of
Mahoney J. being cited, as I understood it to be, I
do not agree that it is authority for the proposition
for which it was cited.
Mr. Justice Mahoney had for consideration
before him the rescission or stay of execution of an
order made by the Canadian Transport Commis
sion, a copy of which order had been entered of
record in this Court pursuant to and with the
effect prescribed by subsections (1), (2) and (3) of
section 61 of the National Transportation Act.
Under section 61(1) any order made by the
Commission may be made an order of the Federal
Court of Canada or of any superior court of any
province of Canada and shall be enforced in like
manner as any order of the Court.
Subsection (2) of section 61 provides the proce
dure to make the order of the Commission an
order of the Court and that procedure is twofold:
(1) the usual practice and procedure of the Court
in such matters may be followed, or (2) in lieu
thereof a certified copy of the Commission's order
may be made by the Secretary which copy shall
have an endorsement thereon signed by the Presi
dent with the seal of the Commission affixed
moving to make the order of the Commission an
order of the Federal Court.
Under subsection (3), in this latter event, the
Secretary forwards such certified copy so endorsed
to the proper officer of this Court and thereupon
the Commission's order becomes an order of this
Court.
It was the second of these two procedures that
the Commission adopted and the persons respon
sible for so electing the second procedure available
to the Commission were astute in doing so. First,
because there is no rule in the Federal Court
Rules which specifically deals with such matters
and there may well be no "usual practice and
procedure of the court" or if there is a usual
practice and procedure it would be that concluded
by Mr. Justice Walsh to be applicable to the filing
and registration of an order of a Board under
section 159 of the Canada Labour Code, that is by
way of notice of motion under Rules 319 and 321.
Section 61 of the National Transportation Act
differs dramatically from section 223 of the
Income Tax Act. While Mahoney J. did not base
his decision on this point, under section 61 the
order of the Canadian Transport Commission
becomes an order of this Court whereas an order
filed and registered under sections 123 and 159 of
the Canada Labour Code and a certificate under
section 223 of the Income Tax Act do not.
This was made abundantly clear by Thurlow J.
(as he then was) in M.N.R. v. Bolduc ([1961]
Ex.C.R. 115) where he said, in effect, that a
certificate is not a judgment nor does it become a
judgment of the Court when registered but it
remains merely a certificate, albeit one of a unique
nature, upon which the proceedings authorized by
the Income Tax Act may be taken.
Mr. Justice Mahoney said [at pages 648-649]:
Parliament's prescription for the making of an order of the
CTC an order of this Court under section 61 of the National
Transportation Act is quite different from its prescription for
giving similar effect to orders under sections 123 and 159 of the
Canada Labour Code. It is unnecessary here to consider the
significance, if any, of the distinction that, by subsection 61(3),
a CTC order, upon entry of record in the Court, "shall there
upon become and be" the order of the Court while under the
particular provisions of the Canada Labour Code, an order,
upon registration, ''has the same force and effect...as if... [it]
were a jam,yacicnt obtained in the Court." The sections of the
Canada labour Code prescribe no procedure for effecting
re;Ã tratioo. In the absence of such prescription, the procedures
of the Court 1. ' warn with the result indicated in the decisions
cited. Section 61 of the National Transportation Act does,
however, prr -rik procedure. The CTC has the choice of
ffoHHowin , i,e "usual practice and procedure" of the Court or it
may follow the procedure it did in this instance. Where Parlia
ment has given the CTC that clear option, it would be unrea
sonable to hold at if it chooses the second, it is bound by
requirements that pertain only to the first.
Parliament has, in unambiguous terms, prescribed a proce
dure for the making of orders of the CTC orders of this Court
w E:ch, unlike the Court's own procedures, excludes compliance
wi 6: the principle arrdi alteram partem. That procedure has
been scrupulously followed here and, accordingly, the order is
no more subject to rescission than had it been registered after
due compliance with the "usual practice and procedure" of the
Court- The motion to rescind the order will be dismissed ... .
Ha\, it so disposed of the question as to the
rescission of the order he then turned his attention
to the alternative motion to stay the execution of
the order and his reasoning in this respect has no
application to ï u e present motion.
/i ccordl gly l revert to a consideration of the
areas of similarity and dissimilarity between sec
tion 159 of the Canada Labour Code which was
the subject of Mr. Justice Walsh's decision in
Public Service Alliance of Canada, Local 660 v.
Canadian Broadcasting Corporation (supra) and
section 123 of the Canada Labour Code which was
the subject of the decision in International Broth
erhood of Electrical Workers, Local Union 529 v.
Centr u l Broadcasting Company Ltd. (supra) on
the one hand and section 223 of the Income Tax
Act on the other to ascertain if these decisions are
applicable to the production and registration of a
Minister's certificate under section 223 of the
Income Tax Act.
All statutes are to be construed so as to give
effect to the intention which is expressed by the
words used in the statute. But that is not to be
discovered by considering those words in the
abstract but by inquiring what is the intention
expressed by those words used in a statute with
reference to the subject matter and i' a object with
which the statute was enact-•.
Under subsections (2) of sections 123 ,., nd 159 of
the Canada Labour Code it is provided i . t on the
"filing" of a copy of an order of the i,t I . rd under
subsection (1) then the order of the 'u .' rd sio s 11 be
registered and upon registration the order of the
Board has the same force and effect and all pro
ceedings may be taken rrereon as if t'r,e order were
a judgment of the Court.
Under subsection (2) of section 223 of the
Income Tax Act it is provid - , k that "On ,: educ-
tion" to the Federal Court the Minister's certifi
cate shall be registered and when res °.tered it shall
have the same force and effect, and all pr i.,iinf
may be taken thereon, as if the certificate were a
judgment obtained in the Court for a debt in the
amount certified by the Minister plus interest as
provided in the Income Tax Act until payment.
In the section of the Canada u-our Code the
phrase used is "On filing" whereas in the section
of the Income Tax Act the phrase is "0 rr produc
tion". As I appreciate the mean,. rig of "to file" it is
to place a document in the Court records a "to
produce" is to offer for inspection or consideration.
For practical purposes it would appear that the
phrases "On filing" and "On prn suction" basically
and substantially have the same meaning with the
exception that the phrase "On production" has the
implication of inspection and if, on inspection, the
certificate so produced, a l ,. rt from the substance
in the body thereof, patently displays inaccuracies
such as that it is susceptible of being interpreted as
a document issued by the Court when it is not and
refers to a cause of action where none exists, it is
then that such patent irregularities constitute jus
tification for the rejection of a certificate in such
form on production as I have concluded to Li;- the
case.
The object of the Canada Labour Code can be
gleaned, in general terms, from the preamble
which is support for freedom of association among
employees on the one hand and employers on the
other and the principle of free collective bargain
ing as the bases of effective industrial relations for
good working conditions and sound labour-man
agement relations.
The Canada Labour Code, being a code, then
enacts specific provisions designed to accomplish
that general objective as expressed in the preamble
such as the determination of appropriate collective
bargaining units, certification of bargaining units
and the hearing and determination of complaints,
disputes and allegations of unfair practices.
To do so provision is made for the establishment
of a board for these purposes.
Every order of such a board is final, in the sense
that it shall not be questioned or reviewed in any
court except in accordance with section 28 of the
Federal Court Act.
From the very nature of the powers, duties and
functions of the board the orders and decisions
given by it necessarily will direct compliance with
a provision of the Code by a party.
Therefore it is almost invariably an order direct
ing some person to do some specific act or refrain
from doing some specific act. The order is positive
in the sense that it directs some person to do
something such as directing an employer to rein
state a discharged employee and the like.
In International Brotherhood of Electrical
Workers, Local Union 529 v. Central Broadcast
ing Company Ltd. (supra) these considerations led
me to say at pages 81-82:
The legislative intent is abundantly clear in subsection (2) of
section 123. It is that when an order of the Board has been
registered it shall have the same force and effect as if the order
of the Board had been an order of this Court for purposes of
enforcement and that all processes available for the enforce
ment of an order of this Court are equally available for the
enforcement of an order of the Board when it has been regis
tered as contemplated by the section.
Section 123 is ranged with section 122 under the heading
"Review and Enforcement of Orders". In my view a heading
such as this is not to be treated as if it were a marginal note or
merely for the purpose of classifying the enactments. In my
opinion it constitutes an important part of the statute itself and
may be read, not only as explaining the sections which follow,
as a preamble may be read, but as a better key to the
construction of the sections which follow than might be afford
ed by a mere preamble.
It is for this reason added to the language of the section that
I conclude that section 123(2) was inserted in the statute for
the purpose of providing for the enforcing of orders of the
Board by the processes of this Court, no similar means being
provided in the Canada Labour Code for the Board to enforce
its orders. That is the obligation thrust upon this Court by
section 123(2). That being so, the orders of the Board must be
cast in the precise language as are orders of the judges of this
Court and must be so framed as to be capable of enforcement
by the normal processes of this Court.
The normal processes of this Court usually
sought to enforce an order or decision of the Court
are orders of committal for contempt of the
Court's order and sequestration of property.
However before the Board makes its finding and
consequent order or decision there has been a
hearing before that tribunal. There has been a
quasi -lis between quasi-parties and the principles
of natural justice will have been complied with,
and if not resort may be had to section 28 of the
Federal Court Act, particularly notice and the
opportunity to be heard.
Because there is no provision in the Code for
the Board to enforce its orders sections 123 and
159 make provision for the registration of the
order of the Board in this Court whereupon that
order becomes enforceable as an order of this
Court.
The condition for doing so under sections 123
and 159 are, as stated before, that the order or
decision of the Board has not been complied with
by the party ordered to do some act within a
period of fourteen days from which the order of
the Board was made or a date provided therein for
compliance. These conditions prevailing, then the
other party may file a copy of the order or decision
of the Board and upon registration the conse
quences provided for in subsection (2) follow.
The gist of the decision of Walsh J. in Public
Service Alliance of Canada, Local 660 v. Canadi-
an Broadcasting Corporation (supra), as I
appreciate it, is that whether there has been failure
to comply with the Board's order within the pre-
scribed time is a justiciable issue. That being so
the principles of natural justice apply, particularly
the requirement of notice and the opportunity to
be heard.
The only procedure available to so ensure under
the Federal Court Rules, and which would be the
"usual practice and procedure of the court", would
be by way of notice of motion under Rule 321 and
Rule 319. That this was the proper procedure to be
followed was held by Walsh J. and failure to
follow that procedure vitiated the registration of
the order.
In International Brotherhood of Electrical
Workers, Local 529 v. Central Broadcasting Com
pany Ltd. (supra) at pages 89-90, I adopted and
applied the decision of my brother Walsh by
saying:
I think I am bound to approach this matter in the same way
as the similar problem was approached by Mr. Justice Walsh
until such time, if any, as a different course is indicated by a
higher court. When I say bound, I do not mean that I am
bound by any strict rule of stare decisis but by my own view as
to the desirability of having this Court follow a consistent
course as far as possible. That being so, the original filing and
registration of the Board's order in the Registry of this Court
on March 12, 1975, was a nullity.
In addition to the reasons outlined by my broth
er Walsh I added further comment at page 99:
The decision of Mr. Justice Walsh in Public Service Alliance
of Canada v. Canadian Broadcasting Corporation (supra)
makes eminent common sense. If this Court is to enforce an
order of the Canada Labour Relations Board as its own order
then the Court must have control over the order of the Board
which is to be filed and consequently registered. That control is
present in a limited extent in subsection (1) of section 123 of
the Canada Labour Code which provides that failure to comply
with an order of the Board must be established before the order
is filed. If the Board's order is imprecise, as this order is, then it
is impossible to establish non-compliance therewith and the
order must be rejected for filing.
Upon examination of the Board's order, which
examination would have been denied me if regis
tration followed ex debito justitiae on filing, it was
evident that the Board's order was not intended to
be final in that the Board reserved unto itself the
right to fix the "quantum" of salaries to dis
charged employees failing agreement between the
parties (there was no agreement between the par
ties and no reference made to the Board to fix the
quantum) and even if the Board's order was final,
in the sense that it was to be enforced by the
processes of this Court, the order was so vague,
imprecise, ambiguous and inexplicit as not to be
capable of enforcement.
Furthermore I was not satisfied on the evidence
before me that the order of the Board had not been
complied with and I declined the request that I
should amend the Board's order to fix a time for
compliance with its order first because this was not
an appeal proper from the Board's order so that I
might give the order the Board ought to have given
and secondly because the Board's order remains
what it always has been and that is the order of the
Board even though enforceable as an order of this
Court and the only proper authority to amend that
order, if it can be amended, is the Board. This was
the reason for which the request to amend a
certificate made by the Minister under section 223
of the Income Tax Act was refused in the Star
Treck matter.
I turn now to a consideration of section 223 of
the Income Tax Act in the light of the legislative
intent of the Income Tax Act with respect thereto.
It is axiomatic that there is no equity in a taxing
statute and the Income Tax Act is no exception to
that axiom. On the contrary the Act is stacked
against the taxpayer and in favour of the tax
collector designed, no doubt, as a matter of public
policy to strengthen the hand of the tax collector
and to ensure that the taxpayer and his assets fall
within the net cast by the collector even though the
taxpayer may contest his liability to tax. Under
section 158(1) of the Act the taxpayer shall,
within 30 days from the mailing of the notice of
assessment (not from the date of the receipt of the
notice, there having been instances where the
entire 30 days from mailing the notice was con
sumed in delivery) the taxpayer shall pay the tax
assessed whether or not an objection to or appeal
from the assessment is outstanding.
Clearly from section 158 the tax assessed is
payable 30 days from the mailing of the notice of
assessment even if it is subsequently established
that the taxpayer is not liable therefor and if the
Minister so orders under section 158(2) the tax
may become payable forthwith upon assessment.
If the taxpayer does not pay the assessed tax on
the date fixed for payment he is assessed for
interest at a rate of 6% on the amount unpaid so
long as it remains unpaid, either in whole or in
part. However, if there has been an overpayment
of tax or if it has been found by a court of
competent jurisdiction that no tax is payable as
assessed, a refund shall be made to the taxpayer
with interest from the day the overpayment arose
but with interest at a prescribed rate of 3% and the
interest so paid is assessed as income to the tax
payer in the year in which the payment was made.
Of course there is no equity in the Income Tax
Act but the cold fact remains that tax is payable
upon assessment as indicated above.
Therefore, under section 223 (1) the amount
payable under the Act is all taxes assessed, interest
accumulated thereon, penalties imposed and the
like which have not been paid. That is the amount
to be certified by the Minister. The conditions to
that certification are either one of those recited in
paragraph (a) or (b) of section 223(1).
After careful reflection I have reached the con
clusion that the requirements of section 223(1)
that an amount has been assessed and remains
unpaid and that thirty days have elapsed from the
mailing of the notice of assessment or a direction
has been made by the Minister under section
158(2) waiving the thirty-day period, are condi
tions precedent to the making of the certificate by
the Minister as opposed to conditions precedent to
the registration of the certificate under section
223(2) on production.
In the Star Treck matter I pointed out that a
person affected by such a certificate can impugn
the making thereof and its registration in an origi
nal proceeding in this Court but I made the tenta
tive suggestion by way of obiter that for the Minis-
ter not to establish the conditions precedent to his
making the certificate was an open invitation to
attack its validity. To do so is still open to the
person adversely affected by the certificate but in
view of the conclusion I have reached that the
conditions in section 223(1) are prerequisites to
the Minister making the certificate as opposed to
registration itself that gratuitous suggestion was
not well-founded. On the other hand, since I have
concluded that the material content of the certifi
cate dictated by section 223(1) is the amount
payable that has not been paid, then other recitals
are surplus and it may well be advantageous to
state by recital or otherwise that the conditions
precedent to the making of the certificate exist, ex
abundanti cautela.
As a result of the foregoing conclusion it follows
that on production under section 223(2) of a cer
tificate in proper form registration thereof is man
datory particularly from the use of the word
"shall".
By virtue of section 244(13) of the Income Tax
Act every document purporting to be a certificate,
amongst other specified instruments, over the
name of the Minister, the Deputy Minister or
officer authorized by regulation, shall be deemed
to be a document signed, made and issued by the
Minister, his deputy or authorized official and can
be called into question only by the Minister or
some person acting for him or Her Majesty. That
means that the document must be accepted by
other persons for what it purports to be and the
authority of the signatory cannot be questioned.
That does not mean that the conditions precedent
to making the certificate and the accuracy of the
content of the certificate cannot be attacked by the
person adversely affected by it.
The maxim omnia praesumuntur rite et solem-
niter esse acta donec probetur in contrarium
would be applicable, which is simply that every
thing is presumed to be rightly done and duly
performed until the contrary is shown, that is until
the contrary is shown by the person attacking the
registration. Therefore it is to be presumed that
the prerequisites to the making of the certificate
by the Minister have been complied with and on its
face such certificate is to be taken as rightly made
and accordingly shall be accepted for registration
on production under section 223(2) subject always
to that presumption being rebutted by the person
adversely affected in a subsequent proceeding.
I am confirmed in this conclusion by the com
ments made by my brother Addy in Lambert v.
The Queen ([1975] F.C. 548) in which the plain
tiff sought a declaration that section 223 of the
Income Tax Act is unconstitutional and ultra vires
of the Parliament of Canada as being contrary to
the principles of natural justice and the Canadia n
Bill of Rights.
Mr. Justice Addy dismissed the action. He
pointed out that under the Income Tax Act proce
dure is provided for a taxpayer to contest an
assessment against him, that the obligation of a
taxpayer to pay the tax assessed, pending final
determination of the liability, is not a final deter
mination of the taxpayer's liability, since it is still
open to him to contest the assessment and if
successful to claim a refund for any overpayment.
He also stated that the powers given the Minister
by section 223 to ensure speedy and effective tax
collection do• not infringe the principle of audi
alteram partem and section 2(e) of the Canadian
Bill of Rights.
On appeal to the Appeal Division of the Federal
Court the appeal from the decision of Addy J. was
dismissed (Lambert v. The Queen [1977] 1 F.C.
199) but the issue on appeal was decided on the
question whether a subsequent assessment to the
assessment on which the Minister's certificate
under section 223(1) was based nullified the liabil
ity to pay tax under the prior assessment. The
Court of Appeal held that this did not render the
Minister's certificate void so that in all other
respects the decision of Addy J. stands inviolate.
Accordingly many of Mr. Justice Addy's com
ments warrant repetition in the context of the
present motion. He said at page 551:
Generally speaking, even an administrative act or procedure,
where it involves a decision, which results in a fmal determina
tion of rights, is subject to the common law rule as to the right
to be heard and also to the provisions of section 2(e) of the
Canadian Bill of Rights as aforesaid, while one that does not
result in a final determination of rights is not subject to either.
Cartwright J. (as he then was), in delivering reasons on behalf
of the Supreme Court of Canada in its unanimous decision in
the case of The Queen v. Randolph ([19661 S.C.R. 260) stated
at page 266:
Generally speaking the maxim audi alteram partem has
reference to the making of decisions affecting the rights of
parties which are final in their nature, and this is true also of
s. 2(e) of the Canadian Bill of Rights upon which the
respondents relied.
The following passage in Broom's Legal Maxims, 10th ed.,
at p. 117 is in point:
Although cases may be found in the books of decisions
under particular statutes which at first might seem to
conflict with the maxim, it will be found on consideration
that they are not inconsistent with it, for the rule, which is
one of elementary justice, only requires that a man shall
not be subject to final judgment or to punishment without
an opportunity of being heard.
He then defined the legal issue before him as
follows [at page 552]:
The legal issue turns on whether the issuing of the certificate
and the registering thereof in the Federal Court of Canada
constitute in effect a final determination of any fundamental
rights of the plaintiff.
Having so defined the issue he continued to say
[at page 552]:
It is clear that where a judgment fixes the liability for taxes
and the amount thereof, there will be no further right to be
heard on the merits of the case unless some error had occurred
on the conduct of the trial or in the making of the decision
which flows at law from the evidence adduced at the trial or
from the facts alleged in the pleadings in the case of a
judgment in default of either appearance or pleading.
At this point it is significant to repeat that the
certificate of the Minister when registered does not
become a judgment but is enforceable as such by
the processes of the Court for which reason the
certificate should not recite a style of cause where
no cause exists.
Addy J. then continues to outline the right of a
taxpayer to be heard on the merits of the assess
ment in these words [at pages 552-553]:
In the case of a certificate issued under section 223, however,
there is a full right to be heard on the merits if an objection to
the assessment is made within the time limited for making such
an objection, and section 165 provides for the method of
objecting, imposes an obligation on the Minister to reconsider
the assessment and also confers the right on a taxpayer to
appeal directly to the Tax Review Board or to the Federal
Court.
While the right off the taxpayer to contest an
assessment is preserved, Addy J. points out the
unique effect of the registration of a Minister's
certificate in these words [at page 5531:
The procedure laid down in the Act gives full right to the
taxpayer to contest the assessment either before or after the
certificate is registered depending on when the Minister has
issued and registered the certificate. It is clear that the issuing
of the certificate does not put an end to the normal right of the
taxpayer to contest any assessment. It does, however, permit
execution against the assets of the taxpayer to take effect even
before the case as to liability has been finally heard, in the
event of the taxpayer failing to pay the tax in the meantime.
The obligation to pay the tax, pending final determination of
the liability to do so, is not a final determination of the
taxpayer's liability for the tax, since, notwithstanding any such
payment, it is still open to him to contest the assessment and, if
successful, to claim the return of any overpayment after final
determination. These are obviously two different matters.
Although it might be argued that the right to register a
certificate, before the liability to pay the taxes has been finally
determined, is an extraordinary one, and although that right
carries with it a right to a writ of execution which in turn
carries with it the right to have the assets seized and subse
quently disposed of by sale or otherwise, the execution aspect is
merely a means of guaranteeing or of assuring the payment of
the tax by the taxpayer either before or after the liability for
same has been finally established.
In Morch v. M.N.R. ([1949] Ex.C.R. 327) it
has been held that there is nothing unreasonable or
unduly oppressive in the summary procedure pro
vided by Parliament for the registration of a Min
ister's certificate and the effects which flow there
from where execution has been issued on the
certificate, notwithstanding an objection to or
appeal against the assessment.
As I have mentioned above and as Mr. Justice
Addy also states, the obligation of a taxpayer to
pay the tax assessed against him arises upon the
assessment, subject to the right of contesting the
ultimate liability therefor.
Addy J. expressed the policy of the Income Tax
Act in these words [at page 555]:
The public policy behind the power in many taxing statutes
to declare an amount payable before final liability for the
amount has been determined and to take effective steps of
securing such payment by means of seizure of assets and of sale
of same if necessary, is of course founded on the principle that
the tax collector must be furnished some means of preventing
tax avoidance by dissipation of assets or by the taxpayer
removing them from the jurisdiction. Where the fundamental
right of the taxpayer to have his liability for taxes ultimately
determined on the merits is preserved, such as in the Income
Tax Act, the powers given the Minister of National Revenue by
section 223 to ensure speedy and effective tax collection do not
infringe the principle of audi alteram partem or the Canadian
Bill of Rights.
As has been held by my brother Thurlow in
M.N.R. v. Bolduc (supra) the right of the taxpay
er to contest the facts upon which the au
thority of the Minister to make and register a
certificate under section 223 are based, remains
available to the taxpayer.
In effect the result is that while the right of a
taxpayer to contest an assessment to tax and to
impugn the Minister's certificate both remain,
these rights are postponed and do not constitute an
impediment to the registration of a certificate by
the Minister under section 223 on production if, on
its face, it is in proper form.
It is not the proper function of a judge to inquire
into the policy and public expediency which moti
vate the legislative branch of government in enact
ing statutes save as is necessary to determine the
purpose and object of a statute as an aid in
interpreting the intention of the legislature as
expressed in the words it used. To do otherwise
would be an abandonment of the role of judge and
the assumption of the role of the legislator.
In comparing a certificate under sections 123
and 159 of the Canada Labour Code which were
the subjects of decision in Public Service Alliance
of Canada, Local 660 v. Canadian Broadcasting
Corporation (supra) and International Brother
hood of Electrical Workers, Local 529 v. Central
Broadcasting Company Ltd. (supra) with a certifi
cate under section 223 of the Income Tax Act,
different legislative intention, policy and procedure
are apparent.
Under the Canada Labour Code there has been
a lis inter partes with a hearing to be conducted
within the principles of natural justice. Following
that hearing one party may be directed by the
Board established under the Code to do a specific
act. If there has been a failure to perform that act
within a time prescribed then the adverse party
affected thereby may file a copy of the Board's
order to obtain enforcement of that order by the
processes of the Court, there being no such facili
ties vested in the Board. The question as to failure
to comply with the Board's order within a pre
scribed time is susceptible of dispute and being a
condition precedent to the filing and registration of
the order it follows that the filing and registration
must be by way of an application, notice of which
has been served on the opposite party otherwise no
opportunity is afforded the adverse party to be
heard. That was the ratio decidendi of Public
Service Alliance of Canada, Local 660 v. Canadi-
an Broadcasting Corporation (supra).
Under the Income Tax Act a sum of money
assessed as tax becomes payable on assessment.
Mr. Justice Addy has outlined the policy explicit
in the statute whereby the tax collector is empow
ered to seize the taxpayer's assets and thus pre
serve the certainty of collection. This is a means to
that end and does not end the taxpayer's right to
contest the assessment or the correctness of the
basis of the Minister's certificate. It postpones
these rights with the taxpayer's assets secure in the
hands of the tax collector during the interval.
By virtue of section 122 of the Canada Labour
Code every order or decision of a board is final and
should not be questioned or reviewed in any court,
except in accordance with section 28 of the Feder
al Court Act.
As Cartwright J. (as he then was) stated in The
Queen v. Randolph (supra) the maxim audi
alteram partem has reference to the making of
decisions affecting the rights of parties that are
final in their nature.
Since an order of a board under the Canada
Labour Code is final the maxim is applicable, as
Walsh J. held in Public Service Alliance of
Canada, Local 529 v. Canadian Broadcasting
Corporation (supra), but since the certificate
under section 223 of the Income Tax Act is not
final but the content thereof and the prerequisites
to its making are subject to attack, albeit a post
poned attack, the maxim is not applicable as held
by Addy J. in Lambert v. The Queen (supra).
It is for the foregoing reasons that I have con
cluded that upon the production of a Minister's
certificate under section 223 of the Income Tax
Act proper on its face such a certificate must be
accepted for registration under subsection (2) of
section 223. For the reasons also expressed the
certificate produced for registration in the present
application is not a proper certificate on its face
because of the objectionable matter therein and
accordingly I decline to direct its registration in its
present form as is requested.
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.