Law Times

November 6, 2017

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Page 2 November 6, 2017 • Law Times the public favoured Law Society of Ontario, 29 per cent voted for Ontario Law Society and 23 per cent supported Legal Profes- sionals of Ontario. Bencher Julian Falconer says the options presented in the sur- vey ref lected feedback received from the public about which words were clearer and helped gain a better understanding of the law society's function. "We consistently heard what confused and consistently heard from the public that the words 'Upper Canada' were not help- ful in understanding what we do," says Falconer, who was the chairman of the Strategic Com- munications Steering Group, which conducted the research about the name change. The steering group enlisted the help of expert consultants to come up with the alternatives. The group found that the profession was evenly split on the issue of whether the law so- ciety should change its name, but Convocation approved dropping the old name in Sep- tember by a 38-11 vote. The debate over the law soci- ety's name has pitted those who thought the name has historical value against those who thought the name was anachronistic and a barrier to engaging with the public. Donald Crawford, president of the Middlesex Law Associa- tion, says that while he supports changing the regulator's name, he was concerned the law soci- ety hadn't properly reached out to rural lawyers in the lead-up to the decision. "We always have a feeling that the GTA people control everything in the province," he says. "And I guess there's some suggestion of that." The association has been conducting its own survey with its membership about whether it agrees with the name change, but it had not yet finalized the results when benchers voted on the new name. At Convocation, some benchers voiced concerns that the proposal was being ap- proved too quickly without consulting enough with the membership. Bencher Peter Beach pro- posed an unsuccessful motion to table the vote on the new name until January to allow for more consultation and argued that the whole process has been f lawed. "This motion has been rammed down our throats with virtually no notice at all to the profession and very little to the benchers," he said at Convoca- tion. Beach said that benchers should take another month or two to consult further. "At least take the time to let the members feel that they have been consulted and that this is at the end of the day going to be a consensus among our mem- bers going forward." LSUC Treasurer Paul Scha- bas, who has been supportive of a name change, said the in- formation has been available for the profession since June. Falconer pointed to the fact that the law society also held a full information session for the profession in June and shared all the available data. There were 33 benchers who voted for the new name. Bencher Joe Groia was the lone bencher who voted for Ontario Law Society. Six abstained from the vote and five voted against the motion. The change is the first step of a larger communications strate- gy the law society is exploring to better engage the public. It will take effect Jan. 1, 2018. The law society has put aside $150,000 for the rebranding, which will be rolled out over a year. The legal name will remain the "Law Society of Upper Can- ada" until the provincial legis- lature amends the Law Society Act. LT Thousands respond to survey on name change able supply to a recipient or pur- chaser and has remitted the tax payable to the CRA, the supplier can bring an action against the recipient. Diamond found the section allows that when suppliers pay outstanding tax owed by a re- cipient, "then and only then" does the supplier have the right to sue. The defendants contended that s. 225 of the act places a two-year limitation on 24 Gold's ability to claim the correspond- ing input tax credit, meaning the company had allegedly lost the right to claim such a credit because of Money Mart's delay. This should preclude the plaintiff 's action, 24 Gold sub- mitted. Diamond rejected this argu- ment, finding s. 224 does not have a time limit on when a plaintiff must bring such an ac- tion. "On that basis alone, I do not find the presence of any limita- tion period in the Excise Tax Act to commence a legal proceeding contemplated under section 224," he wrote in the decision. Huberman says the decision makes it very clear what needs to be done in order to bring a cause of action under s. 224 of the Excise Tax Act, as well as what the applicable limitations period is. The judge also determined that s. 225 of the act allows the input tax credit to be filed at any time as long as HST was not originally charged and the CRA has since audited the vendor for the outstanding tax. Lawyers say the decision points out the power of the sup- plier's right under s. 224 of the act to sue a recipient of a taxable supply when the recipient hasn't paid the tax to the supplier and recover it as if it were a debt. "In fact, the court's willing- ness to provide 'summary judg- ment' on these matters shows the practical power of this right," says Robert Kreklewetz, a partner with Millar Kreklewetz LLP, who was not involved in the decision. Kreklewetz says the underly- ing issue for the recipient in such a case is how to challenge the CRA's assessment that the gold was subject to HST. "It cannot, and yet that can be the real underlying issue in some of these cases where there is a legitimate issue as to whether the initial supply was taxable, zero-rated or exempt," he says. The defendant also argued that Money Mart's claim was statute-barred by the Limita- tions Act and should have im- mediately realized its failure to invoice 24 Gold at the time of the transactions for the owing tax. Diamond, however, found that Money Mart did not have a cause of action until it invoked s. 224 after it paid the HST that was due. The limitation period, there- fore, would not commence until June 2015 at the earliest. "While I do not condone the delay on the part of the plaintiff to properly invoice the subject transactions, the bottom line is that the plaintiff could not com- mence a legal proceeding until the CRA audit resulted in the payment by the plaintiff of the outstanding HST," Diamond wrote. "No cause of action in law ex- isted until that point." Robert Winters, a tax lawyer who was not involved in the case, says he expects the case will be appealed. "I don't think tax lawyers will look at this and expect this to be the last word on it," he says. Jack Zwicker, the lawyer who represented 24 Gold, did not respond to a request for com- ment. 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