October 07, 2011

Her Majesty the Queen (Appellant) v. Global Communications Limited (Respondent)

97 DTC 5194
Federal Court of Appeal
April 7, 1997

(Court File Nos. A-147-97, A-178-97 and A-205-97.)

Appeal procedure — In course of corporate taxpayer’s appeal to Tax Court of Canada, that Court making three orders, including one refusing Crown leave to amend its Reply — Whether Tax Court Judge manifestly right in refusing such leave — Income Tax Act, R.S.C. 1985 c. 1 (5th Supp.), s. 169.

Two months prior to the date (April 14, 1997) fixed for the trial of the corporate taxpayer’s appeal to the Tax Court of Canada, the Crown applied for leave to amend its Reply. The proposed amendment sought to add an allegation that a certain person, through whom taxpayer had bought certain seismic data forming the basis for its claimed Canadian Exploration Expense deduction, had engaged in similar activities (characterized by the Crown as tax scams) with other taxpayers. The Tax Court judge concluded that this allegation was irrelevant and, if allowed, would broaden the litigation beyond all reason. The Crown appealed to the Federal Court of Appeal.

Held: The Crown’s appeal was dismissed. The Tax Court judge was manifestly right. He had also denied an adjournment of the trial and a stay of the order setting the case down. But the principal ground upon which such adjournment and stay had been requested was the pending proposed amendment, which had now been disposed of.