Ontario Court of Appeal unpersuaded by principle that governments have the right to legislate “illogically”
In Stonehouse Group Inc. v. Ontario (Minister of Finance), 2021 ONCA 10, a taxpayer was successful in its dispute with the Ministry of Finance. As a result, a refund of the reassessed taxes was paid. The Minister of Finance attempted to argue that the Corporations Tax Act (Ontario) denied the payment of interest to the taxpayer on this refund notwithstanding the obvious unfairness of this interpretation. In advancing that position, counsel for the Minister relied on the principle that “governments have the right to legislate illogically”. The Ontario Court of Appeal found that principle to “not be a persuasive one…[and] not a principle of statutory interpretation to be readily invoked”. Ultimately, the Court disagreed with the Minister’s interpretation of the legislation and held that interest was payable to the taxpayer.