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FEDERAL INCOME TAX - Appeals - Tax Court of Canada - Representation - Corporations

Thursday, January 21, 2021 @ 6:10 AM  


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Appeal by the Crown from a Tax Court decision granting the respondent corporation leave to be represented by Gagnon, its sole shareholder and director, who was not a lawyer, in a proceeding instituted by the respondent.

HELD: Appeal allowed. The legislator did not intend to oust the common law and civil law principle that a corporation, because of its very nature, could not appear “in person” before a court. It could only be represented by an agent who was a distinct person than the corporation. Other than the grammatical structure of s. 17.1 in the reference to “a party”, there was nothing that suggested that the legislator intended to change the common law/civil law concept that only individuals had the right to appear “in person” or to adopt a definition other than the ordinary meaning of these words at s. 17.1. The grammatical structure of the provision was not sufficient to reach a different conclusion, considering the nature of the rights described, clear statutory scheme and its object. By adopting detailed provisions dealing with representation in the Act, the legislator limited the Tax Court’s implied power to control who could represent the corporation in their courtroom, especially in proceedings subject to the General Procedure. The ordinary meaning of the words “in person”, as opposed to the legal concept of “person”, and the common law/civil law concept that a corporation could not appear in person because of its very nature strongly suggested that under s. 17.1, a party who was a corporation must be represented by counsel as defined by s. 17.1(2). Under the proper statutory interpretation of s. 17.1, the Tax Court could not find that Gagnon personified the corporation and that he was exercising its right to appear “in person”. As Gagnon was not a lawyer, he could not act as counsel for the corporation.

Canada v. BCS Group Business Services Inc., [2020] F.C.J. No. 1152, Federal Court of Appeal, J. Gauthier, Y. de Montigny and G.R. Locke JJ.A., December 2, 2020. Digest No. TLD-January182021007