Law Times

Law Times • apriL 16, 2018 Page 13 www.lawtimesnews.com Supreme Court of Canada Labour and Employment Law LABOUR LAW Trade unions Proper way to sue union was to obtain representation order Plaintiff employee PL brought action for wrongful dismissal against defendant union, and later against directors of union as individual defendants. Union pleaded that as trade union, it could not be named as party without representation order, pursuant to s. 3(2) of Rights of Labour Act. After expiry of lim- itation period, employee moved successfully to amend statement of claim, adding individual di- rectors as representatives of union. Majority of Court of Ap- peal dismissed union and direc- tors' appeal. Majority held that, while proper way to sue union was to obtain representation order, this statement of claim could not be considered nullity because union did not treat it as such, and there was question of how Act should be interpreted in context of contemporary la- bour relations regime. Majority agreed with motion judge that union was sum of its members and that members would have known that employee intended to name legal entity that they comprised as members. Major- ity agreed with motion judge that request for representation order could be characterized as request to correct name of party incorrectly named. Majority held that union and directors participated in action for over two years and would suffer no prejudice as result of representa- tion order. Union and directors appealed. Appeal dismissed. Appeal was dismissed substan- tially for reasons in three para- graphs in decision of majority of Court of Appeal. International Brotherhood of Electrical Workers (IBEW) Local 773 v. Lawrence (2018), 2018 CarswellOnt 4370, 2018 CarswellOnt 4371, 2018 SCC 11, 2018 CSC 11, Wagner C.J.C., Abella J., Moldaver J., Karakat- sanis J., Gascon J., Côté J., Brown J., Rowe J., and Martin J. (S.C.C.); affirmed (2017), 2017 Carswel- lOnt 5650, 2017 ONCA 321, Robert J. Sharpe J.A., P. Lauw- ers J.A., and C.W. Hourigan J.A. (Ont. C.A.). Federal Court Criminal Law SEARCH AND SEIZURE Detention of property seized Finding of contravention under Excise Act not required before legal forfeiture occurs Return of seized goods. RCMP found contraband tobacco in truck leaving plaintiffs' resi- dence. RCMP seized $181,183 in cash from plaintiffs' residence pursuant to search warrant is- sued under s. 487 of Criminal Code. Plaintiffs received seizure report, providing that funds were seized pursuant to s. 260 of Excise Act, 2001. Plaintiffs were charged under Act and Code, but criminal charges were dropped. Plaintiffs' request for return of seized funds was out of time. Plaintiffs brought mo- tion for summary judgment of their action for declaration that defendant Crown was unlaw- fully detaining seized funds and to determine whether Code or Act applied to seized funds. De- fendant brought motion to sum- marily dismiss claim. Plaintiffs' motion dismissed and defen- dant's motion granted. This was appropriate case for determi- nation by summary judgment. Plaintiffs' argument that there must be finding of contraven- tion under Act before legal for- feiture occurred was not con- sistent with Act. Seized funds were seized pursuant to search warrant to verify compliance with Act. Act applied to seized funds and warrant under Code did not change this conclusion. Provisions in Act that provided process for objections to sei- zures operated to oust jurisdic- tion of court. Plaintiffs' failure to take steps under Act to object to seizure within outlined time frames meant there was no gen- uine issue for trial. Flaro v. Canada (2018), 2018 CarswellNat 650, 2018 Carswell- Nat 997, 2018 FC 229, 2018 CF 229, Ann Marie McDonald J. (F.C.). Tax Court of Canada Tax GOODS AND SERVICES TAX Supply RVs delivered or made outside Canada were not taxable supplies subject to GST/HST American registrant entered into dealership sales and service agreements with Canadian deal- ers to allow dealers to sell recre- ational vehicles (RVs) and parts in Canada. Dealers could choose option of having registrant ar- range to have common carrier transport RV to dealer. Regis- trant retained customs broker to assist in shipping parts, which would arrange for carrier to ship parts to broker's facility in Can- ada. Minister of National Rev- enue assessed registrant for un- collected GST/HST on sales of recreational vehicles (RVs) and freight transportation service relating to parts and uncollected provincial component of HST with respect to parts shipped from US to Canadian dealers. Registrant appealed. Appeal allowed in part. Appeal was al- lowed with respect to supply of RVs but not in respect of supply of parts. Registrant was not re- quired to collect and remit GST and HST on RVs because they were delivered or made available outside Canada, so they were not taxable supplies. Under Indiana laws, delivery occurred at sell- er's place of business. RVs were delivered at business premises of registrant in US, so supplies were deemed to be made outside Canada pursuant to s. 142(2) (a) of Excise Tax Act. Registrant was required to collect and re- mit provincial component of HST on parts shipped from US to Canada because parts were delivered or made available in Canada, so they were taxable supplies. Under contractual ar- rangement, customs broker was acting on behalf of registrant and delivery did not occur at registrant's business premises in US. In light of contractual ar- rangements, bill of lading, and conduct of registrant, Canadian dealers and broker, parts were delivered or made available in Canada. Jayco, Inc. v. The Queen (2018), 2018 CarswellNat 534, 2018 TCC 34, Johanne D'Auray J. (T.C.C. [General Procedure]). INCOME TAX Administration and enforcement Enquiries were extensive enough to negate finding of wilful blindness Brother of taxpayer's then boy- friend received tax refund of ap- proximately $50,000. Taxpayer and boyfriend viewed refund cheque and were told that broth- er had confirmed that cheque could be cashed. Taxpayer and boyfriend engaged same tax preparer and signed blank docu- ments for tax preparer. Taxpayer was denied business loss for 2008 taxation year and was as- sessed gross negligence penalty of $24,760 per s. 163(2) of Income Tax Act. Taxpayer appealed. Ap- peal allowed. Denial of claimed business loss of $178,172 was not contested. Two elements of s. 163(2) to be established were false statement in return and knowledge or gross negligence in making of, assenting to or ac- quiescing in making of that false return. Taxpayer had not con- tested that false statements were made in her 2008 T1 adjust- ment return. Evidence did not support that taxpayer had any actual knowledge of false state- ments being made on her behalf in her 2008 revised filing. View- ing cheque was significant and reasonable step taken by person unsophisticated in tax matters to assure herself as to legality of work done by tax return prepar- ers boyfriend's brother had uti- lized. Enquiries were extensive enough to suffice for purposes of negating finding of wilful blindness in context of her deci- sion that she could trust new tax return preparers. Kajtor v. The Queen (2018), 2018 CarswellNat 24, 2018 TCC 6, B. Russell J. (T.C.C. [General Procedure]). INCOME TAX Tax credits Claim to SRED capital expenditure requiring evidence of intention to use Waterjet System for SRED Taxpayer claimed $453,323 as a scientific research and experi- mental development (SRED) capital expenditure. Amount represented cost of integrated and automated Pure Pulse Wa- terjet System equipment. 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