Section 305

The appellant (“RBBSI”), a legal professional corporation for Mr. Bureau, did not file a notice of appeal within 90 days of the final HST assessments in issue, but applied under s. 305 for an extension order on the one-year anniversary of such assessments (i.e., nine months into the period for so applying). In accepting the application, Russell J accepted the testimony of Mr. Bureau that his strategy was to see if anticipated income tax reassessments (both of the appellant and him personally) might assist RBBSI’s HST position in its HST appeal. He further stated (at para. 15) regarding the test in s. 305(5)(b)(ii)):

I consider it just and equitable to permit an entity its day in court absent a clear rationale for declining to do so. As well … procedural gaffes are not so egregious as to require or demand denial of this application.

Regarding the test in s. 305(5)(b)(iv), he stated (at para. 18) that “there is a semblance of logic to … [RBBSI’s] position, sufficient to constitute reasonable grounds for appealing.”

An application for extension of time to file a GST appeal to the Tax Court of Canada succeeded solely because the Court of Quebec had reached the same conclusion in a parallel Quebec Sales Tax appeal. Houda International said it instructed its lawyers to file appeals for GST and QST assessments, but they were not filed on time; Houda was granted an extension from the Court of Quebec in its QST appeal on the basis that it was not at fault for its lawyer’s failure to timely file an appeal. Its parallel application in the Tax Court of Canada from a GST assessment, was granted on the basis that the two statutory extension tests were essentially the same, and the doctrine of “abuse of process” prevented relitigation of an issue already decided in another court. Boyle J stated (at para. 21):

I am satisfied that the matter before this Court has already been addressed by the Cour du Quebec and should not be relitigated before this forum as that might result in a different outcome.

He further found (at para. 22) that “judicial comity” would be further grounds to avoid duplicating the litigation and avoid potential conflicting decisions:

According to the doctrine of judicial comity, reasoned judgments of such courts or judges should be deferred to in the absence of exceptional circumstances.

The appellants applied for extension of time to appeal an assessment. Their lawyer had missed the deadline, they took five months to retain a new lawyer, and the new lawyer took a further four months to file application.

Favreau J. dismissed the application. Although the appellants were not at fault for the first lawyer’s negligence, they were at fault for not proceeding expeditiously to remedy the problem, thereby not meeting the condition of s.305(5)(b)(iii). Furthermore, the court suggested that the first lawyer’s negligence would not be grounds for allowing an application, as this would be inconsistent with Di Monica (2001 CanLII 548) and s.166.2(5)(b)(ii).