COURT FILE NO.: CV-18-00609250-0000
DATE: 20200204
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
FORD MOTOR COMPANY OF CANADA, LIMITED
Appellant
(Moving Party)
– and –
THE MINISTER OF FINANCE (ONTARIO)
Respondent (Responding Party)
Mark Tonkovich and Jeffrey Shafer, counsel for the Appellant (Moving Party)
Arnold H. Bornstein and Jesse Epp-Fransen, counsel for the Respondent (Responding Party)
HEARD: DECEMBER 19, 2019
G. DOW, J.
REASONS FOR DECISION
[1] The Appellant (Moving Party), Ford Motor Company of Canada, Limited (“Ford”) seeks a determination of whether the reassessment by the Respondent, The Minister of Finance (Ontario) (“Minister”) of what the Minister described as an excess refund payment with interest was done beyond the applicable limitation period set out by the proper application of subsection 82(11) of the Corporations Tax Act, R.S.O. 1990, c. C.40 as amended (“CTA”).
Background
[2] The taxation year in question was 1999. The parties were involved in assessments, objections and reviews of that taxation year with a decision by the Minister of October 29, 2009 that Ford was entitled to be repaid by $5,429,823.39. On May 10, 2017, the Minister delivered a Notice of Assessment advising Ford that its prior calculation of interest was interest was incorrect and Ford was obligated to repay this amount plus interest which then totaled $6,285,751.58.
[3] Ford appeals that assessment to this court seeking summary judgment on the basis that the Minister’s demand for repayment was out of time.
Analysis
[4] The authority of the Minister to seek reimbursement for its calculation error is under subsection 82(11)(a) of Part V of the CTA and provides for “Recovery of excess refund” as a subheading. It becomes a “liability of the Corporation” which the Minister may assess. In addition, this provision states, at subsection 82(11)(b) “the provisions of Part V apply with necessary modifications to such assessment as though the assessment were made under subsection 80(11)”.
[5] The subheading above subsection 80(11) states “When assessment may issue” and the subsection begins “The Minister may at any time assess tax, interest or penalties …” and goes on to limit situations, such as this one which was not “tax, interest or penalties” in subsection 80(11)(c) to being done on or before the later of the expiry of the “normal assessment period” and the “latest day on which a reassessment, additional assessment or assessment can be made…”. “Normal assessment period is defined under Subsection 80(10) as “five years after the day of mailing of a notice of an original assessment”.
[6] The parties agree the proper legal test involves evaluating the text of the statute to be interpreted, the context in which the statute can be interpreted, and the legislative purpose. The key difference in the position of the parties was the submission by Ford that subsection 82(11) stands on its own. The Minister submitted the “as though the assessment were made under subsection 80(11) results in importing “at any time” contained at the outset of subsection 80(11).
[7] In this regard, I was directed to the federal legislation passed in 1970 on which the CTA was modelled as part of determining the legislative purpose. The equivalent section in the federal statute is section 180.1 and contains the words “at any time”. The inference is the Ontario legislation, passed in 1994, was not only aware of the possible importance of including “at any time” but chose not to include this phrase. This position is reinforced by the comments of the Supreme Court of Canada in Markevich v. Canada, 2003 SCC 9 (at paragraphs 15 and 16) where it approved the principle of statutory interpretation that courts should not insert or infer extra wording when there is an acceptable interpretation which does not require adding words.
[8] The Legislature of Ontario clearly has the ability the consider and set limitation periods and has repeatedly done so in the CTA where it gave the Minister power to make assessments “at any time”. It did not do so in this subsection. Any decision to not limit the power of the Minister to make assessments against a taxpayer should be stated clearly. That was not done here.
[9] As a result, I conclude that, in this situation, where the Legislature “intends there to be no limitation period, it has so stated” (at paragraph 16 in Markevich v. Canada, supra). As a result, there is a limitation period under subsection 82(11) which passed before delivery of the May 10, 2017 Notice of Assessment.
[10] Both parties made additional and alternative submissions in support of their respective positions. Given my analysis above determines the matter, I shall not detail those submissions.
Conclusion
[11] The disputed reassessment or more precisely, the Notice of Assessment dated May 10, 2017 was statute barred as having been issued beyond the applicable normal reassessment period under the CTA. The Appellant, as requested, is granted summary judgment in its favour pursuant to Rule 20.01(1).
[12] The parties jointly submitted they could likely agree on costs once this decision was known and I urge them to do so. If they cannot do so within the next thirty days, Ford may submit to me in writing the quantum they are seeking including any Offer to Settle being relied on by or before February 28, 2020. The Minister shall have until March 20, 2020 to submit its written responding submissions to me setting out its position. Both parties shall limit their submissions to not more than five doubled spaced pages in a readable font in accordance with Rule 4.01(1) 2.
_____________________________ Mr. Justice G. Dow
Released: February 4, 2020
COURT FILE NO.: CV-18-00609250-0000
DATE: 20200204
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
FORD MOTOR COMPANY OF CANADA, LIMITED
Appellant (Moving Party)
– and –
THE MINISTER OF FINANCE (ONTARIO)
Respondent (Responding Party)
REASONS FOR DECISION
Mr. Justice G. Dow
Released: February 4, 2020