Law Times

PAGE 14 CaseLawLaw FEDERAL COURT OF APPEAL Social Welfare CANADA PENSION PLAN Leave to appeal Review Tribunal's decision should have been granted Application judge erred in de- nying appellant's application for judicial review of decision of designated Member of Pen- sion Appeals Board who re- fused appellant's leave to appeal from Review Tribunal decision. Had application judge directed her attention more closely to designated member's decision rather than to that of tribunal, she would have allowed appli- cation given record, error of law committed by tribunal's powers under Canada Pension Plan, and failure of designated Member to even mention ar- guments put forward by ap- pellant, which raised arguable case for consideration. Matter referred back to board for rede- termination by another mem- ber on basis that leave to appeal decision of tribunal should be granted. Upshall v. Canada (Attor- ney General) (Oct. 5, 2009, F.C.A., Sharlow, Ryer and Tru- del JJ.A., File No. A-381-08) Decision at 168 A.C.W.S. (3d) 880 was reversed. Order No. 009/286/120 (15 pp.). Taxation INCOME TAX Judge erred in granting application for judicial review from minister's decision Application judge granted ap- plication for judicial review brought by respondent to set aside decision of Minister of National Revenue refusing to cancel certain interest and pen- alties that were payable by re- spondent pursuant to Income Tax Act (Can.), in respect of its 1988 to 1990 taxation years. Application judge made no error in holding that portion of decision that encompassed refusal of Minister to cancel Post-December 1, 1996 ac- crued interest was unreason- able. However, application judge erred in resulting order that he made. Matter remitted to Minister for redetermina- tion in accordance with these reasons. Slau Ltd. v. Canada Revenue Agency (Sep. 22, 2009, F.C.A., Sexton, Layden-Stevenson and Ryer JJ.A., File No. A-560-08) Decision at 172 A.C.W.S. (3d) 246 was reversed in part. Order No. 009/280/078 (17 pp.). CANADA CIVIL CASES Industrial And Intellectual Property Action PATENTS Action for damages for patent infringement was dismissed by pharmaceutical company against competi- tor for damages for patent in- fringement. Pharmaceutical company obtained patent cov- ering 15 trillion compounds with similar chemical struc- ture. Pharmaceutical company subsequently obtained selec- tion patent covering particular compound called olanzapine. Olanzapine was purported to have manifested unexpected, substantial, and special prop- erties compared to other com- pounds covered by original patent. Olanzapine was regard- ed as relatively safe and often effective medicine for treating schizophrenia. Competitor produced generic version of olanzapine. Action dismissed. Selection patent did not ad- equately describe alleged ad- vantages of olanzapine. Indeed, pharmaceutical company did not have evidence supporting alleged advantages of olanzap- ine when it applied for selection patent. Olanzapine was not known to be superior in terms of less increase in particular liv- er enzymes or muscle enzyme and no sound prediction could have been made. Evidence did December 14, 2009 • Law Times COURT DECISIONS ainmaker_LT_June2_08.indd 1 CaseLaw is a weekly summary of notable unreported civil and criminal court decisions by the Supreme Court of Canada, the Federal Court of Canada and all Ontario courts. CaseLaw is a weekly summary of notable unreported civil and criminal court decisions by the Supreme Court of Canada, the Federal Court of Canada and all Ontario courts. Single or multiple copies of the full text of any case digested in this issue can be obtained by: 5/28/08 10:43:29 AM Single or multiple copies of the full text of any case digested in this issue can be obtained by calling CaseLaw's photocopy department at (905) 726-5419, or 1(800) 565-6967. i) completing and mailing in the order form in this issue; or ii) calling CaseLaw's photocopy department at (905) 841-6472 in Toronto, (800) 263-3269 in Ontario and Quebec, or (800) 263-2037 in other provinces; or iii) faxing a copy of the completed order form to (905) 841-5085. not support advantage of olan- zapine over another compound in terms of producing less neu- romuscular side effects and no sound prediction could have been made. Fact that olanzap- ine did not produce increase in cholesterol in dogs when com- pared with another compound was not shown to be advan- tage. Evidence did not provide substantial factual foundation for assertion that olanzapine had high efficacy at low doses. Other alleged advantages were not supported by evidence. Evidence did not go so far as to establish misstatements or omissions on part of pharma- ceutical company. Competitor was entitled to relief under s. 8 of Patented Medicines (Notice of Compliance) Regulations (Can.), to be determined in separate proceeding. Eli Lilly Canada Inc. v. Novop- harm Ltd. (Oct. 5, 2009, F.C., O'Reilly J., File No. T-1048- 07) Order No. 009/293/020 (72 pp.). TAX COURT OF CANADA Taxation INCOME TAX Trusts were resident in Canada for purposes of Treaty In 1998 reorganization of share structure of PMPL, two trusts with Canadian beneficiaries were settled by individual resi- dent in Caribbean island of St. Vincent. Sole trustee of each trust was corporation resident in Barbados. As part of reorga- nization, trusts subscribed for shares of newly-incorporated Canadian corporations and corporations in turn subscribed for shares of PMPL. Transac- tions were effected at nominal consideration. In 2000, as part of arm's length sale of PMPL, trusts disposed of majority of shares that they held in hold- ing companies. Capital gains of over $450,000 were real- ized. Amounts on account of potential tax on capital gains had been remitted to govern- ment pursuant to withholding procedures in s. 116 of Income Tax Act (Can.). In income tax returns filed for 2000 taxation year, trusts sought return of amounts withheld, claiming exemption from tax pursuant to Article XIV(4) of Agree- ment Between Canada and Barbados for the Avoidance of Double Taxation and the Pre- vention of Fiscal Evasion with Respect to Taxes on Income and Capital ("Treaty"). Min- ister correctly took position that exemption does not apply because trusts were resident in Canada. Judge-made test of residence that had been estab- lished for corporation should also apply to trusts, with such modifications as are appro- priate. That test is "where the central management and con- trol actually abides". Although corporate trustee of each trust was acknowledged to be resi- dent in Barbados, management and control of each trust was in Canada. Trusts were resident in Canada for purposes of Treaty. Appeal dismissed. Garron v. Canada (Sep. 10, 2009, T.C.C., Woods J., File No. 2006-1405(IT)G; 2006- 1407(IT)G; 2006-1408(IT) G; 2006-1409(IT)G; 2006- 1410(IT)G) Order No. 009/260/040 (101 pp.). ONTARIO CIVIL CASES Bankruptcy And Insolvency COURTS AND PROCEDURE Registrar erred in setting aside notices of examination Appeal by trustee from order by registrar setting aside notices of examination pursuant to s. 163(1) of Bankruptcy and In- solvency Act (Can.), prohibit- ing bankrupt from conducting examinations. Appeal allowed. Registrar erred in principle in ordering that firm not be per- mitted to conduct examina- tions. Assets of creditor were not at risk of being dissipated by funding questions. Safire Infrastructure Inc. (Re) (Oct. 16, 2009, Ont. S.C.J., Hoy J., File No. 32-1037458; 32-1037902; 32-1037972) Order No. 009/299/031 (8 pp.). Civil Procedure PLEADINGS Motion judge erred in striking several paragraphs from statement of claim Motion judge correctly struck number of paragraphs in state- ment of claim on basis that they were non-justiciable. Ap- pellants were granted leave to amend to plead with greater clarity claim that respondents breached their duty to educate appellants' children in accor- dance with Anglican faith and values by promoting and in- doctrinating students with fun- damentally different religious values, thereby causing them harm. Motion judge erred in striking number of paragraphs on basis that they were redun- dant, irrelevant, pled evidence or were argumentative. These paragraphs ought not to have been struck. Cavanaugh v. Grenville Christian College (Oct. 26, 2009, Ont. C.A., O'Connor A.C.J.O., Sharpe and Juriansz JJ.A., File No. C50253) Deci- sion at 175 A.C.W.S. (3d) 95 was reversed in part. Order No. 009/306/020 (3 pp.). Debtor And Creditor PRIORITIES Bank and insurer were entitled to satisfaction of shortfall Application by bank and mort- gage insurer for mortgage in- surance proceeds applied in satisfaction of shortfalls experi- enced by them and for balance to be placed in court. Bankrupt and man were joint tenants of property. Bankrupt and man mortgaged property with plain- tiff bank and had mortgage insurance. Bankrupt made as- signment. Man died. Bank ex- Your next best move? SMSS.COM CHARLOTTETOWN Untitled-6 1 Choose to have our IT expertise in your corner. FREDERICTON www.lawtimesnews.com HALIFAX MONCTON SAINT JOHN ST. JOHN'S 12/1/09 11:31:42 AM

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