Law Times

Law Times • November 5, 2018 Page 15 www.lawtimesnews.com apprehended prejudice and need to repress sudden disap- pearance of species in danger because of human activity or quality of environment. There was no evidence in this case that Parliament, when it ad- opted section 80 (4) (c) (ii) of Act, had ulterior motive or that it was attempting to unjustifi- ably encroach on jurisdictions assigned to provinces. Latitude allowed Governor in Council to carefully adapt prohibited ac- tivity according to particulari- ties of species within its habitat and this case-by-case approach was not antithetical to criminal law jurisdiction. Groupe Maison Candiac inc. c. Canada (Procureur gé néral) (2018), 2018 CarswellNat 3416, 2018 CarswellNat 4437, 2018 FC 643, 2018 CF 643, René LeBlanc J. (F.C.). Tax Court of Canada Public Law SOCIAL PROGRAMS Employment insurance Individual failed burden of showing that Minister's determination of his insurable hours was not accurate Individual was employed for entity as delivery driver during crab season. Individual relied on his pay records indicating that he had 457 and 546 insur- able hours for 2010 period and 2011 period respectively. Min- ister of National Revenue de- termined that individual's pay records overstated number of hours worked by individual in relevant period for purpose of entitling him to claim employ- ment insurance and increase his pensionable earnings. Min- ister determined that individ- ual actually worked 447 hours for 2010 period and 446 hours in 2011 period. Investigation of entity had begun in 2009 when entity was suspected of falsify- ing records of employment for purpose of qualifying individu- als for employment insurance benefits that they were not en- titled to receive and company was ultimately convicted of of- fence in regard to this matter. Individual appealed Minister's decisions with respect to 2010 and 2011 periods. Appeal dis- missed. Individual provided no corroborating evidence for claims that he did odd jobs for entity before and after crab sea- son and similar explanations had been given by others of entity's alleged workers whose records of employment were found to be inaccurate – Indi- vidual failed burden of showing that Minister's determination of his insurable hours was not accurate. Carrier v. M.N.R. (2017), 2017 CarswellNat 2601, 2017 CarswellNat 3679, 2017 TCC 101, 2017 CCI 101, Robert J. Ho- gan J. (T.C.C. [Employment In- surance]). Tax INCOME TAX Administration and enforcement Minister's conduct unnecessarily lengthened proceedings, which supported enhanced award of costs Minister of National Revenue assessed taxpayer, treating ga- rage roof repairs as capital ex- penditures, not current expense. Minister refused taxpayer's of- fer to settle. Taxpayer's appeal was allowed. Taxpayer brought motion for costs of $200,000. Motion granted. Taxpayer was awarded lump sum of costs of $150,000. Taxpayer was entirely successful and obtained judg- ment more favourable than its offer to settle. Minister did not respond to taxpayer's offer to settle and raised concern about potential for double deductions for first time in costs submis- sions. Taxpayer's offer could be considered as factor in costs award, but it could not be con- sidered within s. 147(3.1) of Tax Court of Canada Rules (Gen- eral Procedure). Minister's con- duct unnecessarily lengthened proceedings, which supported enhanced award of costs. Por- tion of claimed costs and dis- bursements was incurred prior to filing of notice of appeal so they were denied. Five per cent administrative fee and profes- sional fees for research and prep- aration of memo were denied. Taking into account taxpayer's settlement offer and Minister's conduct, and disallowed dis- bursements, lump sum award of $150,000 was justified. Aon Inc. v. The Queen (2018), 2018 CarswellNat 3163, Diane Campbell J. (T.C.C. [Gen- eral Procedure]); additional rea- sons (2017), 2017 CarswellNat 4242, 2017 TCC 166, Gaston Jorré J. (T.C.C. [General Proce- dure]). Open for director or officer to appear " in person" for corporation as corporation itself and not as agent Representation of corporate taxpayer. Corporate taxpayer brought motion pursuant to R. 30(2) of Tax Court of Canada (General Procedure) Rules to have its sole shareholder, direc- tor and principal officer, DG, act on its behalf. Motion grant- ed on terms. DG could repre- sent taxpayer up to date that parties were to report to court to set trial date, with provisos that ability to act would be revoked if DG missed any deadlines or if Federal Court of Appeal rules that individual could not act for corporate taxpayer. Section 17.1 of Tax Court of Canada Act did not say "individual party" but only "party to proceeding", so s. 17.1(1) of Act could be read as "corporation may appear in person". While there was com- mon law jurisprudence that "in person" could only mean by presence of visible person, there had been no such juris- prudence from Tax Court, un- til recent decisions. Since 1993, Tax Court had proceeded on basis that Act and Rules allowed for director or officer to be "in person" embodiment of corpo- ration. Despite contrary ruling by other Tax Court judges, it was open for director or officer to appear "in person" for corpo- ration as corporation itself and not as agent. In this case, tax- payer could not afford lawyer and DG knew details of issues. DG would be both advocate and witness at hearing, so his ability to act for taxpayer would be lim- ited. There were some concerns with DG's procedural handling of matter, but this was appropri- ate situation to allow DG to be physical presence of taxpayer appearing in person. BCS Group Business Ser vices Inc. v. The Queen (2018), 2018 CarswellNat 3418, 2018 TCC 120, Campbell J. Miller J. (T.C.C. [General Procedure]). Ontario Civil Cases Insurance ACTIONS ON POLICIES Practice and procedure County suffered damages from defendant's failure to obtain insurance Plaintiffs alleged that they slipped and fell on ice while walking through parking lot of community housing location. Defendant was county's winter maintenance contractor for resi- dential parking lot where both plaintiffs claim they fell and were injured. Defendant's insur- er refused to take over defence of county as defendant did not obtain coverage naming county as additional insured as required by contract. These were two sim- ilar Rule 21.01(1)(a) of Rules of Civil Procedure motions for de- termination before trial of ques- tion of law in relation to duty to defend as between county, local housing corporation and third party. Country brought motion for declaration that defendant was in breach of his contract with county for failing to pro- cure insurance naming county as additional insured on policy as required in his contract with county. Motion granted. Dec- laration was issued that defen- dant was in breach of contract for failing to procure insurance naming county as additional insured. County had suffered damages from defendant's fail- ure to obtain insurance as had insurance been obtained, given nature of allegations of neg- ligence by plaintiffs, insurer would have had duty to defend. Had defendant kept his contrac- tual promise, county would have policy of insurance covering costs of defending claims made against county by plaintiffs. Bentley v. Hastings (Coun ty) (2017), 2017 CarswellOnt 7248, 2017 ONSC 2980, H. Ma- cLeod-Beliveau J. (Ont. S.C.J.). AUTOMOBILE INSURANCE No-fault benefits Application of Rule 13 to vehicles travelling in opposite directions at uncontrolled intersection could lead to absurd results Fault determination rules. Driv- er of motorcycle insured by in- surer S collided with car driven by driver insured by insurer B. Accident occurred as car was in process of making left hand turn onto residential street with no traffic signals or signs. Mo- torcycle struck right passenger side of car. Driver of motorcycle applied to insurer S for statutory accident benefits and insurer S sought indemnification from insurer B pursuant to s. 275 of Insurance Act. Insurer B de- clined and dispute was referred for arbitration under Fault De- termination Rules. Rule 12(5) of Rules provided that where two vehicles are travelling in oppo- site directions in adjacent lanes and one vehicle turns left in path of other, driver of left-turning vehicle is 100% at fault for ac- cident. Rule 13(2) of Rules pro- vided that where two vehicles collide at uncontrolled intersec- tion, driver of second vehicle to enter intersection is 100% at fault for accident. Arbitra- tor found that Rule 13 only ap- plied to accidents that occurred when vehicles were approaching uncontrolled intersection from intersecting highways and did not apply to vehicles entering intersection from adjacent lanes travelling in opposite direc- tions as occurred in this acci- dent. Arbitrator found that Rule 13(2) did not apply and that under Rule 12(5) insurer B was responsible for indemnifying insurer S for 100% of statutory accident benefits paid. Insurer B appealed. Appeal dismissed. Arbitrator's decision was both reasonable and correct. There was no principled reason why accident which occurred be- tween two vehicles travelling in opposite directions in adjacent lanes at uncontrolled intersec- tion should have fault allocated differently than in accident oc- curring between two vehicles travelling in opposite directions in adjacent lanes other than at intersection. Application of Rule 13 to vehicles travelling in opposite directions at uncon- trolled intersection could lead to absurd results. State Farm Mutual Auto mobile Insurance Company v. Belair Insurance Company (2017), 2017 CarswellOnt 8333, 2017 ONSC 3281, R.D. Gordon R.S.J. (Ont. S.C.J.). CONTRACTS OF INSURANCE Cancellation and termination Policy was brought to end by mutual agreement of parties Insurer E Co. issued motor ve- hicle policy to V which required installation and use of "auto- graph" device that would record driving information. Some five weeks before end of second six- month term, E Co. informed V that it did not intend to renew for third term because he had failed to register to receive de- vice in previous 12 months. V obtained regular motor vehicle policy from insurer A Inc. but cancelled that policy before he was involved in motor vehicle accident in relation to which he claimed and received statutory accident benefits from Motor Vehicle Accident Claims Fund. Province, on behalf of Minis- ter of Finance, administrator of Fund, brought proceeding disputing obligation to pay in priority to E Co. and A Inc.. Ar- bitrator ruled that E Co.'s notice of non-renewal did not satisfy requirements of s. 236 of Insur- ance Act or Declination Rule 56 because it had been served prematurely and was, therefore, invalid. Arbitrator also found, however, that policy issued by E Co. had not been in force at time of accident with result E Co. was not priority insurer. Province's appeal was allowed. Finding that E Co.'s notice of non-renew- al was invalid because facts in support of declination, failure to register to receive device within previous 12 months, were not in existence at time notice was given was reasonable. Finding that policy had not been in force at time of accident was not rea- sonable. Contracts of insurance remain in force until there is compliance with ss. 236(1), (2) and (3) of Insurance Act. Act re- placed common law principles applicable to renewals of lapsed contracts. There had not been valid notice of non-renewal so policy remained in force at time of accident and E Co. was prior- ity insurer responsible for pay- ment of statutory accident ben- efits.. E Co. appealed. Appeal allowed. Both aspects of arbitra- tor's decision were reasonable and justifiable interpretations of relevant statutory provisions. There was no reason to inter- fere with arbitrator's conclusion that notice of non-renewal was premature. Decision was based on reasonable interpretation of facts and law. Arbitrator's deci- sion that E policy was not longer in force on date was reason- able. Trial judge's finding that s. 236(5) extends coverage until formalities were met was incor- rect as there are other ways to terminate coverage. Section 236 only dealt with non-renewal or policy variations by insurers but it did not deal with renewal. Ar- bitrator's conclusion that policy was brought to end by mutual agreement of parties and was no longer in effect was not unrea- sonable. Ontario (Finance) v. Elite Insurance Company (2018), 2018 CarswellOnt 16490, 2018 ONCA 809, K. van Rensburg J.A., P. Pardu J.A., and David M. Paciocco J.A. (Ont. C.A.); re- versed (2017), 2017 CarswellOnt 8326, 2017 ONSC 3414, P.J. Ca- vanagh J. (Ont. S.C.J.). CASELAW

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