T-2277-86
Corena Doris Clow (Plaintiff)
v.
Her Majesty the Queen (Defendant)
INDEXED AS: CLOW V. M.N.R. (TD.)
Trial Division, Jerome A.C.J.—Vancouver, July 12,
1991; Ottawa, January 23, 1992.
Constitutional law — Charter of Rights — Life, liberty and
security — Application for order Income Tax Act, s. /67(5)(a)
of no force or effect as violating plaintiff's Charter, s. 7 rights
— Initial 90-day limitation period under s. 165 may be
extended during further one-year period under s. /67(5)(a)
Appeal from reassessment not filed within prescribed time and
application for extension dismissed for want of prosecution —
Plaintiff arguing loss of right of appeal having,fnancial conse
quences directly affecting physical and psychological well-
being — Reference to B.C.C.A. decisions holding limitation of
actions for damages not contrary to Charter, ,s. 7 as plaintiffs
seeking economic relief — Plaintiff seeking economic remedy
not covered by Charter, s. 7 — Extension meeting requirement
of inordinateness of delay before remedy taken away — Plain
tiff afforded opportunity of demonstrating violation of Charter
rights by application of legislation.
Income tax — Reassessment — Income Tax Act, s. 167(5)(a)
providing one-year extension to initial 90-day period permitted
under s. 165 to file notice of objection to reassessment —
Plaintiff not filing within prescribed time limit submitting
financial consequences of loss of right of appeal having impact
on physical and psychological well-being — S. /67(5)(a) not
violating Charter, s. 7.
Federal Court jurisdiction — Trial Division — Objection to
notices of reassessment not filed within time prescribed by
Income Tax Act, ss. 165, 167(5)(a) — Argument s. 167(5)(a)
violating Charter, s. 7 right to life, liberty and security rejected
as plaintiff seeking economic remedy not covered by s. 7 — If
time limits in ss. 165 and 167 not met, Court lacking jurisdic
tion to consider action.
This was an application for an order that Income Tax Act,
paragraph 167(5)(a) violated Charter, section 7 and was of no
force and effect. The plaintiff's accountant failed to file a
notice of objection to reassessments within the prescribed time
period. The plaintiff applied to the Tax Court for an extension
of time to file a notice of objection. The application was dis
missed for want of prosecution, no one appearing for the plain
tiff who, according to her affidavit, was hospitalized at the
time. The plaintiff then launched an appeal to the Tax Court,
which was dismissed for want of jurisdiction. The plaintiff
commenced this action seeking an extension of time within
which to file notices of objection, arguing that the Court has
jurisdiction to allow the extension since she has been denied
the right to prove her case on a purely technical ground. She
also alleged that the defendant withheld documents which she
required to prepare proper notices of objection. Upon the
defendant's motion to strike the statement of claim for failure
to prosecute, the plaintiff filed the within application, arguing
that she should be exempted from the application of paragraph
167(5)(a) and that the Court should be permitted to consider
the merits of her application for an extension because, in the
particular circumstances, paragraph 167(5)(a) violates Charter,
section 7. The motion for dismissal was adjourned to consider
the Charter argument.
Under Income Tax Act, subsection 165(1) a taxpayer has 90
days from the day of mailing of the notice of assessment to file
a notice of objection. Under subsection 167(5)(a) an extension
may be granted if certain conditions are met during a further
period of one year. The issue was whether paragraph I 67(5)(a)
violated the plaintiffs Charter, section 7 right to life, liberty
and security of the person. Plaintiff's submission was that par
agraph 167(5)(a) imposed an inflexible and unjustifiable limi
tation on her statutory right of appeal, thereby denying her an
opportunity to explain the delay. This was said to contravene
the principle that persons whose property rights are affected
have a right to be heard. Plaintiff relied upon Bains v. Canada
(Minister of Employment and Immigration), [1989] 3 F.C. 487
(C.A.) as authority for the proposition that a rigid and inflexi
ble time limit with no possibility of extension no matter what
the circumstances, is not in accordance with the principles of
fundamental justice and may lead to a deprivation of life, lib
erty or security of the person. Also relied upon was Kaur v.
Canada (Minister of Employment and Immigration), [1990] 2
F.C. 209 (C.A.) where legislation was not applied to an indi
vidual because it would have infringed her Charter rights.
Plaintiff maintained that the loss of her right of appeal
threatened her financial position and that that could directly
affect her physical and psychological well-being and her secur
ity of the person. The plaintiff essentially argued that her situa
tion fell within a nebulous middle ground where an economic
interest is connected to and affects the life, liberty and security
of the individual. The defendant submitted that the plaintiff is
seeking an economic remedy, something not covered by Char
ter, section 7.
Held, the application should be dismissed; the application to
strike should be allowed.
The plaintiffs Charter, section 7 rights are not infringed by
the application of paragraph 167(5)(a). The British Columbia
Court of Appeal has recently held that limitation periods bar
ring actions for recovery of damages do not violate section 7 as
the plaintiffs were seeking economic relief. In a recent
Supreme Court of Canada decision, Lamer J. indicated that the
kinds of liberty and security of the person intended to be pro
tected by section 7 are those which the state empowers judges
and courts to restrict (such as the confinement of persons
against their will). Although the plaintiff was not seeking dam
ages per se, she was seeking an economic remedy. Even
accepting that there ought to be some inordinateness of delay
before the remedy is taken away, Parliament has met that
requirement by allowing an extension of the initial 90-day lim
itation period during a further period of one year.
There was no merit to the allegations that the plaintiff's
income tax records were withheld contrary to the Charter.
There was no evidence that records were requested or concerns
expressed with respect to these records at any time before the
expiration of the limitation period.
The case law is clear that if the time limits set out in sections
165 and 167 are not met, the Court lacks jurisdiction to con
sider the plaintiff's action.
Bains and Kaur merely stand for the proposition that a per
son shall be afforded an opportunity to demonstrate that his
Charter rights have been violated by the application of legisla
tion. The plaintiff has been afforded this opportunity.
STATUTES AND REGULATIONS JUDICIALLY
CONSIDERED
Canada Shipping Act, R.S.C. 1970, c. S-9, ss. 647(2),
649.
Canadian Charter of Rights and Freedoms, being Part I
of the Constitution Act, 1982, Schedule B, Canada Act
1982, 1982, c. 11 (U.K.) [R.S.C., 1985, Appendix II,
No. 44], ss. 7, 24.
Constitution Act, /982, Schedule B, Canada Act /982,
1982, c. 11 (U.K.) [R.S.C., 1985, Appendix II, No. 44],
s. 52.
Immigration Act, /976, S.C. 1976-77, c. 52, ss.
27(1)(d)(ii), 32(2), 35(1), 70(1).
Immigration Regulations, 1978, SOR/78-172, s. 40(1) (as
am. by SOR/80-601, s. 4).
Income Tax Act, S.C. 1970-71-72, c. 63, ss. 163(2) (as am.
by S.C. 1978-79, c. 5, s. 7), 165(1), 167 (as am. by S.C.
1980-81-82-83, c. 158, s. 58), 169 (as am. idem; 1984,
c. 45, s. 70).
Limitation Act, R.S.B.C. 1979, c. 236, s. 8(1).
CASES JUDICIALLY CONSIDERED
APPLIED:
Graham (H. I.) v. The Queen, [1987] 2 C.T.C. 255;
(1987), 87 DTC 5455 (F.C.T.D.); Whitbread v. Walley
(1988), 51 D.L.R. (4th) 509; [1988] 5 W.W.R. 313; 26
B.C.L.R. (2d) 203 (C.A.); Wittman (Guardian Ad Litem)
v. Emmott (1991), 77 D.L.R. (4th) 77; [1991] 4 W.W.R.
175; 53 B.C.L.R. (2d) 228; 45 C.P.C. (2d) 245 (C.A.);
Streng et al. v. Township of Winchester (1986), 56 O.R.
(2d) 649; 31 D.L.R. (4th) 734; 37 C.C.L.T. 296; 11 C.P.C.
(2d) 183; 25 C.R.R. 357; 34 M.P.L.R. 116; 43 M.V.R. 1
(H.C.); Reference re ss. 193 and 195.1(1)(c) of the Crimi
nal Code (Man.), [1990] 1 S.C.R. I 123; [1990] 4 W.W.R.
481; (1990), 68 Man. R. (2d) 1; 56 C.C.C. (3d) 65; 77
C.R. (3d) 1; 109 N.R. 81.
CONSIDERED:
Bains v. Canada (Minister of Employment and Immigra
tion), [1989] 3 F.C. 487; (1989), 61 D.L.R. (4th) 573; 47
C.R.R. 361; (1989), 8 Imm. L.R. (2d) 165 (C.A.); Kaur v.
Canada (Minister of Employment and Immigration),
[1990] 2 F.C. 209; (1989), 64 D.L.R. (4th) 317; 104 N.R.
50; 10 Imm. L.R. (2d) 1 (C.A.); Smith, Kline & French
Laboratories Limited v. Attorney General of Canada,
[1986] 1 F.C. 274; (1985), 24 D.L.R. (4th) 321; 7 C.P.R.
(3d) 145; 19 C.R.R. 233; 12 F.T.R. 81 (T.D.); affd [1987]
2 F.C. 359; (1986), 34 D.L.R. (4th) 584; 11 C.I.P.R. 181;
12 C.P.R. (3d) 385; 27 C.R.R. 286; 78 N.R. 30 (C.A.);
Chiarelli v. Canada (Minister of Employment and Immi
gration), [1990] 2 F.C. 299; (1990), 67 D.L.R. (4th) 697;
42 Admin. L.R. 189; 10 Imm. L.R. (2d) 137; 107 N.R.
107 (C.A.).
REFERRED TO:
R. v. Neale (1985), 62 A.R. 350; 39 Alta. L.R. (2d) 24; 20
C.C.C. (3d) 415; 46 C.R. (3d) 366; 17 C.R.R. 282; 34
M.V.R. 245 (Q.B.); revd (1986), 71 A.R. 337; [1986] 5
W.W.R. 577; 46 Alta. L.R. (2d) 225; 28 C.C.C. (3d) 345;
52 C.R. (3d) 376; 26 C.R.R. 1; 43 M.V.R. 194 (C.A.); Re
S.E.M. (1988), 88 A.R. 346; [1988] 6 W.W.R. 661; 61
Alta. L.R. (2d) 206 (C.A.); Starlite Bottlers Ltd. v. The
Queen, [1988] 2 C.T.C. 60; (1988), 88 DTC 6272
(F.C.T.D.); Singh et al. v. Minister of Employment and
Immigration, [1985] 1 S.C.R. 177; (1985), 17 D.L.R.
(4th) 422; 12 Admin. L.R. 137; 14 C.R.R. 13; 58 N.R. 1.
APPLICATION for an order that Income Tax Act,
paragraph 167(5)(a) was of no force and effect as it
violated Charter, section 7. Application dismissed.
COUNSEL:
R. Glen Sherman for plaintiff.
Mary Jane Dodge, Q.C. and E. Junkin for defen
dant.
SOLICITORS:
Macintosh Riecken & Sherman, Vancouver, for
plaintiff.
Deputy Attorney General of Canada for defen
dant.
The following are the reasons for order rendered in
English by
JEROME A.C.J.: This application by the plaintiff for
an order that paragraph 167(5)(a) of the Income Tax
Act [S.C. 1970-71-72, c. 63] as am. violates section 7
of the Canadian Charter of Rights and Freedoms
[being Part I of the Constitution Act, 1982, Schedule
B, Canada Act 1982, 1982, c. 11 (U.K.) [R.S.C.,
1985, Appendix II, No. 44]] and that paragraph
167(5)(a) is of no force or effect pursuant to section
24 of the Charter or section 52 of the Constitution
Act, 1982 [Schedule B, Canada Act 1982, 1982, c. 11
(U.K.) [R.S.C., 1985, Appendix II, No. 44]] was
heard at Vancouver, British Columbia on July 12,
1991. On June 24, 1986 the Tax Court of Canada dis
missed for want of jurisdiction the plaintiff's appeal
of an earlier Tax Court decision that it had no juris
diction to consider the plaintiff's application to
extend time to file notices of objection. In the within
action the plaintiff seeks an extension of time within
which to file notices of objection to tax assessments
for the years 1975 through 1978, but is barred by the
operation of the limitation period imposed by para
graph 167(5)(a). The plaintiff argues that she should
be exempted from the application of paragraph
167(5)(a) and that this Court should be permitted to
consider the merits of her application for an exten
sion because, in the particular circumstances of her
case, paragraph 167(5)(a) violates section 7 of the
Charter.
BACKGROUND
The plaintiff's income tax returns for the years
1975, 1976, 1977 and 1978 were assessed by the
Minister of National Revenue (the "Minister") on
June 25, 1976, July 26, 1977, July 14, 1978, and June
26, 1979 respectively. By way of notices of reassess-
ment dated November 18, 1981 the Minister reas
sessed the plaintiff with respect to her 1975, 1976,
1977 and 1978 taxation years. The Minister disal
lowed a number of expenses claimed by the plaintiff
as having been incurred for the purpose of earning
income from a businessl and imposed penalties under
subsection 163(2) of the Income Tax Act [as am. by
S.C. 1978-79, c. 5, s. 7]. 2 According to affidavits of
the plaintiff and of Millard Magasin, both dated June
21, 1991, the plaintiff brought the reassessments to
the attention of her accountant, Mr. Millard Magasin,
in November, 1981. He prepared a notice of objec
tion, but it was not filed because, according to Mr.
Magasin, he was involved in an ongoing process of
review with the Department of National Revenue and
because he had a number of financial problems in
1982.
In an application dated August 10, 1983 the plain
tiff applied to the Tax Court of Canada for an exten
sion of time to file a notice of objection. The applica
tion was called for hearing on January 30, 1984. No
one appeared for or on behalf of the plaintiff, how
ever, and the application was dismissed for want of
prosecution by order of St-Onge T.C.J. dated Febru-
ary 13, 1984. In her affidavit dated June 21, 1991 the
plaintiff explains that she did not attend the hearing
because she was in the Royal Columbian Hospital in
New Westminster, British Columbia, at the time. The
plaintiff then launched an appeal to the Tax Court of
Canada in respect of her 1975, 1976, 1977 and 1978
taxation years. By order of Kempo T.C.J. dated June
24, 1986 the Minister's motion requesting that the
appeal be quashed was allowed because the plaintiff
had failed to comply with the provisions of section
i The following amounts were disallowed: 1975—
$11,631.83; 1976—$11,151.34; 1977—$9,488.78; 1978—
$6,312.00.
2 The Minister alleged that the plaintiff knowingly or under
circumstances amounting to gross negligence made or partici
pated in or assented to or acquiesced in the making of false
statements in her income tax returns for the 1975, 1976, 1977
and 1978 taxation years contrary to s. 163(2) of the Income Tax
Act.
169 of the Income Tax Act [as am. by S.C. 1980-81-
82-83, c. 158, s. 58, item 2; 1984, c. 45, s. 70]. 3
On October 14, 1986 the plaintiff issued a state
ment of claim in this Court with respect to her 1975,
1976, 1977, 1978 and 1979 taxation years submitting
that, on the grounds of her age and illness, this Court
has jurisdiction to allow her this extension since on a
purely technical ground, she has been denied the
right to prove her case. She also alleges that she was
unable to file proper notices of objection at the
required time because all vouchers, documents and
records on which the notices of objection were based
were held by the defendant contrary to the Charter.
The statement of defence was filed on January 30,
1987.
No further action was taken until the defendant by
letters dated January 4 and May 6, 1991 advised the
plaintiff that because there had been no response
from her to date, it would be necessary to strike the
claim. On May 9, 1991 the plaintiff filed a notice of
intention to proceed. She explained that during the
past several years she had suffered from a very severe
case of asthma and bronchial disorders which had
prevented her from giving an earlier response. On
May 17, 1991 the defendant brought a motion to dis
miss the plaintiff's action and on June 24, 1991 the
plaintiff applied to this Court for an order that sub
section 167(5) of the Income Tax Act violates section
7 of the Charter and is of no force or effect. By order
of Joyal J. dated July 11, 1991, the defendant's
motion for an order dismissing the plaintiff's action
was adjourned to July 12, 1991 for the limited pur
pose of considering the plaintiff's Charter argument.
It was further ordered that " [i]n the event the plaintiff
3 169. Where a taxpayer has served notice of objection to an
assessment under section 165, he may appeal to the Tax Court
of Canada to have the assessment vacated or varied after either
(a) the Minister has confirmed the assessment or reassessed,
or
(b) 90 days have elapsed after service of the notice of objec
tion and the Minister has not notified the taxpayer that he
has vacated or confirmed the assessment or reassessed;
but no appeal under this section may be instituted after the
expiration of 90 days from the day notice has been mailed to
the taxpayer under section 165 that the Minister has confirmed
the assessment or reassessed.
is not successful in its Charter argument, judgment
will be ordered in favour of the defendant".
RELEVANT STATUTORY PROVISIONS
The statutory provisions relevant to this applica
tion are subsections 165(1), 167(1) [as am. by S.C.
1980-81-82-83, c. 158, s. 58], 167(2) [as am. idem]
and 167(5) [as am. idem] of the Income Tax Act, S.C.
1970-71-72, c. 63 as amended and section 7 of the
Canadian Charter of Rights and Freedoms, Part I of
the Constitution Act, 1982, being Schedule B of the
Canada Act 1982, 1982, c. 11 (U.K.) and subsection
52(1) of the Constitution Act, 1982:
Income Tax Act
165. (I) A taxpayer who objects to an assessment under this
Part may, within 90 days from the day of mailing of the notice
of assessment, serve on the Minister a notice of objection in
duplicate in prescribed form setting out the reasons for the
objection and all relevant facts.
167. (1) Where no objection to an assessment under section
165 or appeal to the Tax Court of Canada under section 169
has been made or instituted within the time limited by section
165 or 169, as the case may be, for doing so, an application
may be made to the Tax Court of Canada for an order
extending the time within which a notice of objection maybe
served or an appeal instituted and the Court may, if in its opin
ion the circumstances of the case are such that it would be just
and equitable to do so, make an order extending the time for
objecting or appealing and may impose such terms as it deems
just.
(2) The application referred to in subsection (1) shall set
forth the reasons why it was not possible to serve the notice of
objection or institute the appeal to the Court within the time
otherwise limited by this Act for so doing.
(5) No order shall be made under subsection (I) or (4)
(a) unless the application to extend the time for objecting or
appealing is made within one year after the expiration of the
time otherwise limited by this Act for objecting to or appeal
ing from the assessment in respect of which the application
is made;
(b) if the Tax Court of Canada or Federal Court has previ
ously made an order extending the time for objecting to or
appealing from the assessment; and
(c) unless the Tax Court of Canada or Federal Court is satis
fied that,
(i) but for the circumstances mentioned in subsection (I)
or (4), as the case may be, an objection or appeal would
have been made or taken within the time otherwise lim
ited by this Act for so doing,
(ii) the application was brought as soon as circumstances
permitted it to be brought, and
(iii) there are reasonable grounds for objecting to or
appealing from the assessment. [Emphasis added.]
Charter
7. Everyone has the right to life, liberty and security of the
person and the right not to be deprived thereof except in accor
dance with the principles of fundamental justice.
Constitution Act, 1982
52. (1) The Constitution of Canada is the supreme law of
Canada, and any law that is inconsistent with the provisions of
the Constitution is, to the extent of the inconsistency, of no
force or effect.
ISSUE
The issue is simply whether paragraph 167(5)(a) of
the Income Tax Act infringes the plaintiff's right to
life, liberty and security of the person contrary to sec
tion 7 of the Charter.
PLAINTIFF'S SUBMISSIONS
The plaintiff submits that paragraph 167(5)(a) of
the Income Tax Act infringes her section 7 Charter
rights, particularly her right to security of the person.
She contends that paragraph 167(5)(a) imposes an
inflexible and unjustifiable limitation on her statutory
right of appeal. She is thereby denied an opportunity
to answer the issue of delay and thus paragraph
167(5)(a) is at variance with the principle that per
sons whose property rights are affected have a right
to be heard. Furthermore, the threat of harm to the
plaintiff in the present circumstances is sufficient to
attract the protection of section 7 of the Charter. The
loss of her right of appeal could put her in "dire
straights with respect to her financial position at pre
sent".
It is agreed that a mere economic detriment is not a
sufficient ground upon which to base a section 7
Charter argument. The plaintiff alleges, however, that
the loss of her right of appeal is not simply an eco
nomic detriment but a threat to her means of self-sup
port and sustenance such that it will directly bear
upon her physical and psychological well-being and
threaten her security of the person. Relying on the
decision in R. v. Neale (1985), 62 A.R. 350 (Q.B.)
(reversed on other grounds (1986), 71 A.R. 337
(C.A.)), the plaintiff submits that the purpose of sec
tion 7 of the Charter is to enhance the vitality, voli
tion, autonomy and physical well-being of citizens.
The word "deprivation" in section 7 is not limited to
the complete loss or absolute denial of the right to
life, liberty and security of the person, but includes its
mere infringement, and the phrase "security of the
person" is not restricted to physical integrity but may
encompass more than physical and psychological
security.
The plaintiff submits that the Minister is not
prejudiced in any way should a delay go beyond the
one-year limitation period imposed by paragraph
167(5)(a). She suggests that if there is a section 7
Charter infringement or if a limitation period pre
vents a person from being heard when there are
sound reasons for failing to comply with a limitation
period, then a Court may intervene and allow the per
son an opportunity to explain his or her failure to
comply. She, therefore, requests that subsection 52(1)
of the Constitution Act, 1982 be applied in this
instance to exempt her from the operation of para
graph 167(5)(a) of the Income Tax Act and she asks
that this Court consider the merits of her application
for an extension of time within which to file a notice
of objection.
DEFENDANT'S SUBMISSIONS
The defendant indicates that in this case the 90-day
period prescribed by section 165 of the Income Tax
Act expired on February 16, 1982 and that the further
one-year period to apply for an extension under sec
tion 167 expired on February 16, 1983. As the plain
tiff did not file her extension application until
August, 1983 she did not comply with the limitation
periods imposed by the Income Tax Act and, accord-
ing to the strict interpretation previously given to par
agraph 167(5)(a), this Court does not have jurisdic
tion to entertain her appeal.
The defendant submits that the plaintiff's right to
life, liberty and security of the person is not at stake.
The plaintiff's grievance concerns an assessment of
tax for which she will have to make a monetary pay
ment; she will not be subject to imprisonment or any
other denial of her liberty or security. The remedy
she is seeking is an economic remedy and, as such, it
is not covered by section 7 of the Charter. Taxing
statutes affect economic rights and the courts have
clearly rejected the proposition that a right to life, lib
erty or security of the person includes economic rem
edies. Furthermore, there has been no threat taken to
collect the tax liability that has been outstanding and
collectable since 1982 and, in any event, the collec
tion of a valid tax liability is a different issue. Finally,
fundamental justice does not include a right to
abridge limitation periods. Relying on Re S.E.M.
(1988), 88 A.R. 346 (C.A.), the defendant submits
that the Minister must have some degree of certainty
as to when files can effectively be closed and that a
limitation period would become virtually meaning
less with the automatic extension proposed by the
plaintiff.
ANALYSIS
Section 165 of the Income Tax Act provides that a
taxpayer who objects to an assessment may, as of
right, file a notice of objection within 90 days from
the date of the assessment. In the event the taxpayer
does not file the notice of objection within 90 days,
section 167 of the Income Tax Act provides a mecha
nism whereby an extension may he granted to allow
late filing if certain conditions are met and if the
application is made within one year after the expira
tion of the time limit set out in section 165. The juris
prudence is clear that if these time limits are not com
plied with, then this Court does not have jurisdiction
to consider the plaintiff's action. In Graham (H. I.) v.
The Queen, [1987] 2 C.T.C. 255 (F.C.T.D.), Cullen J.
found that he did not have jurisdiction to hear a tax
payer's appeal from an income tax assessment when
the action was not brought within the time limits set
out in paragraph 167(5)(a) of the Income Tax Act.
Accordingly, he allowed the Crown's application for
an order to strike out the taxpayer's statement of
claim. He commented, at pages 256-257:
With respect to the 1979 and 1981 taxation years, as earlier
stated, the plaintiff applied to the Tax Court of Canada for an
extension of time to serve upon the Minister of National Reve
nue, notices of objection in respect of his 1948 to 1979 taxa
tion years inclusive, as well as his 1981 and 1982 taxation
years. That application was dismissed by court order dated
December 18, 1986 (Court No. 2709 (IT)). The applications
were for the most part undated but received by the Court on
December 10, 1985. More than one year and 90 days had
elapsed and so the Tax Court had no jurisdiction to extend the
time for filing notices of objection (see paragraph 167(5)(a) of
the Income Tax Act).
Based on the relevant facts, it was not open to the plaintiff to
launch a trial de novo. If paragraph 167(5)(a) of the Act effec
tively barred any action before the Tax Court of Canada, then
one can no longer consider those taxation years. There is no
jurisdiction in the Federal Court of Canada because the action
was not brought within time limits imposed by the Income Tax
Act. [Underlining added.]
Pinard J. reached the same conclusion in similar cir
cumstances in Starlite Bottlers Ltd. v. The Queen,
[1988] 2 C.T.C. 60 (F.C.T.D.).
Clearly then, as indicated in the order of Joyal J.
dated July 11, 1991, the plaintiff is caught by the lim
itation period unless she is successful in her Charter
argument. In support of her argument and the particu
lar remedy sought in this instance, the plaintiff relies
on two recent decisions of the Federal Court of
Appeal: Bains v. Canada (Minister of Employment
and Immigration), [1989] 3 F.C. 487 and the majority
concurring decision in Kaur v. Canada (Minister of
Employment and Immigration), [1990] 2 F.C. 209.
In Bains, the applicants sought to set aside two
decisions of the former Immigration Appeal Board
refusing to extend time for each applicant to file
applications for redetermination of their claims to
refugee status under subsection 70(1) of the Immigra
tion Act, 1976, S.C. 1976-77, c. 52 in the light of the
limitation period prescribed by subsection 40(1) of
the Immigration Regulations, 1978, SOR/78-172 [as
am. by SOR/80-601, s. 4]. 4 Hugessen J.A., for the
Court, concluded that the Board was correct in deter
mining that it did not have jurisdiction to extend a
time limit fixed by the Governor-in-Council pursuant
to the regulation-making power conferred on him by
the Act. However, he accepted the applicants' argu
ment that a rigid and inflexible time limit within
which to apply for redetermination, with no possibil
ity of extension no matter what the circumstances, is
not in accordance with the principles of fundamental
justice and may lead to a deprivation of life, liberty or
security of the person, contrary to section 7 of the
Charter. He noted, at page 490, that subsequent to the
Supreme Court of Canada decision in Singh et al. v.
Minister of Employment and Immigration, [1985] 1
S.C.R. 177 "[i]t is now well settled that a claim to
refugee status may put in play rights which enjoy
Charter-protection". He allowed the applications and
referred the matters back to the Board for reconsider
ation "on the basis that the Board has jurisdiction to
consider whether fundamental justice requires that, in
the circumstances, the applicants be permitted to
apply for redetermination of their refugee claims
outside the time fixed by law." He commented, at
page 491:
The difficulty with the argument advanced by counsel for
the Minister is that the Board, being of the view that it had no
jurisdiction to do so, never examined the facts of either case. It
4 70. (1) A person who claims to be a Convention refugee
and has been informed in writing by the Minister pursuant to
subsection 45(5) that he is not a Convention refugee may,
within such period of time as is prescribed, make an applica
tion to the Board for a redetermination of the claim that he is a
Convention refugee.
40. (1) A person who claims to be a Convention refugee and
who has been informed in writing by the Minister pursuant to
subsection 45(5) of the Act that he is not a Convention refugee
may, within fifteen days after he is so informed, make an
application to the Board pursuant to section 70 of the Act for a
redetermination of his claim that he is a Convention refugee by
delivering such an application in writing to an immigration
officer or by filing it with the Board.
may well be that, in the end, the Board will agree with the sub
mission of counsel for the Minister and find that the facts
reveal no breach of the rules of fundamental justice, but the
duty of examining and answering that question lies, at least in
the first instance, on the Board and not on this Court. The
Board is a court of record, (Immigration Act, /976, subsection
65(1)) with "sole and exclusive jurisdiction" (Immigration Act,
1976 subsection 59(1)) over a matter such as we have here,
namely, an application for redetermination of a refugee claim.
Its powers and its jurisdiction must be read in the light of the
Charter. Hence it cannot simply refuse to entertain an applica
tion of the type here in question; rather, it must look at the
particular circumstances of each case to determine whether the
applicant stands to be deprived of a Charter-protected right if
not permitted to apply for redetermination, and, if so, whether
fundamental justice requires that he be granted such permis
sion. [Emphasis added.]
In Kaur, an Adjudicator had denied a refugee
claimant's request to reopen her inquiry. At the hear
ing of her Convention refugee claim, the applicant
had stated that she wished to return to India and that
she no longer wished to claim refugee status. An
exclusion order was made, however, the applicant
later requested a reopening of the inquiry because at
the time of the hearing she had been under great
duress exerted by her former husband. Heald J.A., for
the majority concurring opinion, held (at page 216)
that the Adjudicator "did not err in refusing to reopen
the inquiry under the authority of section 35 of the
Act, 5 absent any possible application of the Charter."
He then considered the argument that the applicant's
Charter rights had been infringed and on the basis of
the following reasoning, he concluded (at page 218)
that "this is clearly a case for intervention pursuant to
section 7 of the Charter":
It is apparent from the record that due to the duress exerted
upon her by her former husband during the inquiry, she was
effectively deprived of her right to be represented by indepen-
5 S. 35(1) of the Immigration Act, 1976, S.C. 1976-77, c. 52
provided:
35. (1) Subject to the regulations, an inquiry by an adjudi
cator may be reopened at any time by that adjudicator or by
any other adjudicator for the hearing and receiving of any
additional evidence or testimony and the adjudicator who
hears and receives such evidence or testimony may confirm,
amend or reverse any decision previously given by an adju
dicator.
dent counsel. She was also effectively deprived of the ability to
make a free, informed and independent decision respecting a
claim to refugee status. Accordingly I conclude that the exclu
sion order issued herein is manifestly unfair in the circum
stances of this case and contrary to the provisions of section 7
of the Charter.
On the question of a remedy he found that [at page
223] "this is a clear case for an `exemption' or 'read-
ing out', in which legislation remains in force but is
not applied to a person such as this applicant whose
Charter rights have been infringed through the appli
cation of the legislative provisions to his situation.
Consistent with the reasoning and spirit of the
decisions of the Federal Court of Appeal in Kaur and
Bains, the plaintiff has been afforded an opportunity
to demonstrate that her section 7 Charter rights have
been violated by the application of paragraph
167(5)(a) of the Income Tax Act. I do not consider
that these cases stand for any broader proposition.
Here, the plaintiff agrees that limitation periods are
necessary but suggests that they are not valid in all
cases particularly where a person's section 7 Charter
rights are infringed. She does not seek a declaration
that the section is invalid but simply that, as it oper
ates in the particular circumstances of her case, the
section imposes an unjustifiable limitation on her
right of appeal.
The plaintiff, however, has not convinced me that
in the present circumstances paragraph 167(5)(a)
should be held to be inoperative because it would
have the effect of depriving her of security of the per
son. The circumstances put forth by the plaintiff and
her accountant to explain her delay in filing notices
of objection and to outline the impact that the denial
of a right to appeal will have on her personal situa
tion are unfortunate and regrettable, but certainly not
unique. Accepting, as did Strayer J. in Smith, Kline &
French Laboratories Limited v. Attorney General of
Canada, [ 1986] 1 F.C. 274 (T.D.), at page 315
(affirmed [1987] 2 F.C. 359 (C.A.)), that "there may
be some situations in which section 7 would protect,
incidentally, the property of an individual", the plain
tiff has not shown that this is such a case.
In Whitbread v. Walley (1988), 51 D.L.R. (4th) 509
(C.A.), McLachlin J.A. (as she then was), for the
Court, found that sections 647(2) and 649 of the
Canada Shipping Act, R.S.C. 1970, c. S-9 which
limit the liability of owners and masters of ships for
damages for personal injury to a sum based on the
tonnage of the ship do not deny a right to life, liberty
or security of the person contrary to section 7 of the
Canadian Charter of Rights and Freedoms. In Whit-
bread, the plaintiff had been seriously injured in a
boating accident. He suffered spinal injuries which
resulted in quadriplegia and he sued the defendant
owners and operators of the boat. The Trial Judge
found that the provisions limiting liability were eco
nomic in effect and, therefore, did not infringe sec
tion 7 of the Charter.
On appeal, the Court acknowledged that legislation
or state action that directly affects the life, liberty or
security of the person falls within section 7 and that
legislation that is entirely economic falls outside the
scope of section 7. However, McLachlin J.A.
observed (at page 520) that "[t]he difficult question,
which remains to some extent unresolved, concerns
the situation which falls between these two extremes
—the case where the measure complained of, while it
has an economic aspect, arguably is connected to or
affects the life, liberty or security of the person." She
summarized the plaintiff's Charter arguments (at
pages 520 and 521) as follows: 1. a claim for eco
nomic interest which is founded on a deprivation of
life, liberty and security of person falls within section
7 of the Charter; and 2. a claim for economic interest
which may enhance a person's ability to acquire aids
and amenities to improve the person's life, liberty or
security of person, falls under section 7 of the Char
ter. These arguments, however, were rejected (at
pages 521-522):
The first argument ... requires the words "life, liberty, and
security of the person" in s. 7 to be read as if they were ampli
fied by the words "or such economic benefit as the law may
award in their stead". In the absence of compelling circum
stances, I would be loath to embark on a course of reading into
the Charter words which its drafters did not see fit to include
and which the objectives of the Charter provision in question,
as interpreted in Reference re Section 94(2) of the Motor Vehi
cle Act, supra, [(1985), 24 D.L.R. (4th) 536, 23 C.C.C. (3d)
289, [1985] 2 S.C.R. 486] do not require.
The second argument, ... raises the same difficulty. Argua
bly, it requires reading into s. 7, after the declaration that a
person has the right to "life, liberty and security of person", the
additional phrase that he has the right to "any benefit which
may enhance life, liberty or security of person". This argu
ment, however, is undermined by an even more seriousprob-
lem. It is difficult to conceive of a property or economic inter
est which does not arguably impact on the life, liberty or
security of person. Liberty and security of person are flexible
and expansive concepts, and the degree to which they can
expand is intimately tied with the amount of money one has at
his or her disposal. For example, a person who is barred by
legislation from raising a claim for breach of contract or whose
corporation is denied a licence, might claim that the resultant
financial loss has affected his liberty and security of person
because without money he cannot go where he wants to go,
pursue the activities he wishes to pursue, or provide adequately
for his future. To accept the plaintiffs second argument would
be to make s. 7 applicable to virtually all property interests.
Given the scheme of the Charter and the absence of any refer
ence to the right to property, I cannot accept that this was the
intention of its framers. [Emphasis added.]
Recently, in Wittman (Guardian Ad Litem) v.
Emmott (1991), 77 D.L.R. (4th) 77 (C.A.), it was
held that subsection 8(1) of the Limitation Act,
R.S.B.C. 1979, c. 236, which provided for an ulti
mate limitation of six years for claims against mem
bers of the medical profession, did not infringe sec
tion 7 of the Charter because the direct effect of
section 8 was purely economic in nature in that it
bars a person from seeking damages, an economic
remedy. The plaintiff in Wittman was born in August
1978 with cerebral palsy, spastic quadriplegia and
other serious physical disabilities. In March, 1982 his
parents first became aware that his condition may
have resulted from negligent medical care by the
defendant doctors during the mother's pregnancy.
The plaintiff's writ of summons, issued in 1985 was
dismissed because it was brought outside the six-year
limitation period imposed by section 8 of the Limita-
tion Act. On appeal, the plaintiff argued inter alia that
section 8 violated his rights under section 7 of the
Charter.
Wallace J.A., for the Court, rejected this argument
stating (at page 87) that "[i]n my opinion, what is at
stake in this action is not liberty or security of the
person but an economic remedy." He considered
Whitbread v. Walley and found that subsection 8(1),
in restricting the time within which a claim may be
brought, did not violate section 7 of the Charter. He
stated, at page 89:
Here, the infant plaintiff is suing the defendants to recover
damages in a sum sufficient to compensate him for the injuries
he has sustained. As in Whitbread, the action is one for eco
nomic relief. It does not seek a remedy affecting the dignity,
self-esteem or liberty, in the traditional sense, of the individ
ual.
Even in the area of the deportation of permanent
residents on the basis of the commission of criminal
offences, the Federal Court of Appeal has recently
held in Chiarelli v. Canada (Minister of Employment
and Immigration), [ 1990] 2 F.C. 299, that subpara-
graph 27(1)(d)(ii) and subsection 32(2) of the Immi
gration Act, 1976 did not contravene section 7 of the
Charter. Pratte J.A., for the Court (although dissent
ing on another question), did not accept the appel
lant's argument that the making of a deportation
order against a permanent resident for the sole reason
that he had committed a criminal offence and without
considering the circumstances in which the offence
was committed, was contrary to his rights under sec
tion 7 of the Charter. Furthermore, Lamer J. (as he
then was) in a minority concurring opinion in Refer
ence re ss. 193 and 195.1(1)(c) of the Criminal Code
(Man.), [1990] 1 S.C.R. 1123 considered examples of
when section 7 of the Charter would come into play.
Although not limiting the applicà tion of section 7 to
the examples considered, he observed, at pages 1175-
1176, that:
What is at stake in these examples is the kind of liberty and
security of the person the state typically empowers judges and
courts to restrict. In other words, the confinement of individu
als against their will, or the restriction of control over their
own minds and bodies, are precisely the kind of activities that
fall within the domain of the judiciary as guardian of the jus
tice system.
Here, as in Whitbread and in Wittman, I cannot
find that the plaintiff's section 7 Charter rights have
been or will be infringed by the application of para
graph 167(5)(a). Even though the plaintiff is not
seeking damages per se, she is nevertheless seeking
an economic remedy. As in Whitbread, the plaintiff
in this instance is essentially arguing that she falls
within a nebulous middle ground where an economic
interest is connected to and affects her life, liberty
and security of the person. The Income Tax Act estab
lishes and delineates a right of appeal. Even
accepting, as did the Ontario High Court of Justice in
Streng et al. v. Township of Winchester (1986), 56
O.R. (2d) 649, at page 654, that "there ought always
to be some inordinateness of delay before the remedy
is taken away", I find that Parliament has met this
requirement. The initial limitation period established
by section 165 is 90 days, however, during a further
period of one year it may be extended under certain
conditions.
Finally, the plaintiff's allegations that her income
tax records were withheld contrary to the Charter
thus preventing her from completing a proper notice
of objection are without merit. There is no evidence
that records were requested or concerns expressed
with respect to these records at any time before the
expiration of the limitation period. In addition, such
allegations are contrary to the explanations proffered
by Mr. Magasin in his affidavit of June 21, 1991.
CONCLUSION
Accordingly, the plaintiff's constitutional attack is
dismissed and the defendant's application to strike
the action will succeed. No order as to costs.
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.