Court File and Parties

COURT FILE NO. : CV-22-690982 DATE: 20240103 ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN:

HEATHER MILLER Applicant – and – TELEMACO MATRUNDOLA and 1000125576 ONTARIO INC. Respondents

Counsel: Eric Sherkin, for the Applicant Miranda Spence and Neil Bass, for the Respondents

HEARD in Toronto: December 8, 2023, by video conference

Reasons for Judgment

R. A. LOCOCO J.

I. Introduction

[1] The applicant Heather Miller brings an application to require the respondents Telemaco Matrundola and 1000125576 Ontario Inc. (“576 Ontario”) to comply with an undertaking given in connection with the closing of the applicant’s sale of real property to 576 Ontario.

[2] The agreement of purchase and sale provided that if the transaction was subject to Harmonized Sales Tax (“HST”), the amount of the tax was included in the purchase price. Before closing, to address a dispute as to whether the transaction was subject to HST, the respondents provided an undertaking to the applicant, in which the respondents (i) acknowledged that the applicant would apply for a tax ruling as to the applicability of HST, and (ii) undertook to readjust the purchase price in accordance with the result. After closing, the applicant applied for and received a tax ruling in her favour, but the respondents refused to comply with the undertaking.

[3] The respondents submit the tax ruling was not binding because the information included in the ruling request was untrue, inaccurate or incomplete (which the applicant denies). On that basis, the respondents argue that they are not required to comply with the undertaking.

[4] For the reasons below, I am granting the application, requiring the respondents to pay the balance of the purchase price to the applicant.

II. Background

[5] The applicant acquired a 49.4-acre farm property in Tottenham in April 2017. The property included a residence, where the applicant lived while she owed the property.

[6] The applicant has two businesses: Miller Bins, a sole proprietorship; and Pro Touch Landscape Inc. (“Pro Landscape”), an Ontario corporation that she wholly owns. The property’s address was the registered address for both entities.

[7] When the applicant acquired the property (which was previously a horse farm), it was in a run-down condition. She undertook substantial repair work on the property with the assistance of her boyfriend.

[8] Commencing in June 2020, the applicant leased 30 acres of the property to Chamberlain Acres, an unincorporated partnership. The partners of Chamberlain Acres were two individuals (Mr. and Ms. Chamberlain) who used the property for farming purposes. The lease was for a term of five years with an annual rent of $60 per acre, for a total of $1,800. Mr. Chamberlain drafted the lease, which made no reference to HST. Chamberlain Acres paid the annual rent of $1,800 to the applicant for only one year prior to the applicant’s sale of the property.

[9] The applicant listed the property for sale in the fall of 2021 as a residential listing. Mr. Matrundola made an offer to purchase, using the residential real estate form. Mr. Matrundola is a property developer who owns other similar rural properties. The offer resulted in an agreement of purchase and sale dated October 8, 2021, under which the applicant agreed to sell the property to Mr. Matrundola for $3,355,000. For this transaction, both sides were represented by their own realtors, lawyers and tax advisers.

[10] The purchase agreement provided that if the transaction was subject to HST under Part IX the Excise Tax Act, R.S.C. 1985, c. E-15 (“ETA”) [1], the amount of tax would be included in the purchase price. The agreement also provided that if the transaction was not subject to HST, the seller would certify on or before closing that the transaction was not subject to HST.

[11] The agreement was subject to a due diligence condition that Mr. Matrundola waived on October 19, 2021. Prior to closing, Mr. Matrundola assigned his right to acquire the property to the respondent 576 Ontario, a company he controls, but he remained bound by his other obligations under the purchase agreement by its terms.

[12] Before the transaction closed, the parties had a difference of opinion about whether the transaction was subject to HST. The respondents’ position was that the transaction was subject to HST to the extent that the property was used for commercial purposes. The applicant’s position was that the transaction was exempt from HST since she used the property for residential and personal purposes rather than for commercial purposes.

[13] The parties were unable to resolve their dispute before closing. To permit the closing to proceed, the respondents signed an undertaking addressed to the applicant, the terms of which included the respondents’ acknowledgement and agreement to the following:

a. The applicant will be applying for a written ruling as to the applicability of HST to the transaction, but nothing will preclude the respondents from making their own independent enquiry to the Canada Revenue Agency (“CRA”) and obtaining their own written ruling;

b. The Statement of Adjustments includes a credit of $255,973.45, based on the respondents’ understanding that HST applies to all but $1 million of the purchase price, with their acknowledgement that this understanding may be inaccurate; and

c. Upon receipt of the tax ruling, the respondents will readjust the purchase price in accordance with the HST applicability set out in the ruling and provide the appropriate funds to the applicant within 48 hours, “bearing in mind that the buyer may have also obtained a written opinion as to the applicability of H.S.T. in this transaction which, if it differs from that of the seller’s written opinion, will then require further discussion, negotiation and agreement.”

[14] The undertaking also included the respondents’ acknowledgement that the applicant would be providing an appraisal of the value of the residential portion of the property. However, at the application hearing, counsel for both parties agreed that provision was not relevant to the outcome of this application.

[15] The property transaction closed on March 4, 2022, the day after the undertaking was signed. The purchase price the respondents paid on closing was reduced by $255,973.45, being the respondents’ estimate of the HST payable on the taxable portion of the property, in accordance with the undertaking’s terms.

[16] While not explicitly stated in the undertaking, correspondence between counsel indicated the parties’ intention that if HST was payable, the respondents would remit to CRA the required amount of tax. If the transaction was exempt from HST, the respondents would pay the withheld portion of the purchase price to the applicant.

[17] On March 9, 2022, the applicant submitted a ruling request to CRA. The ruling request was prepared by a tax accountant with experience in HST. On May 5, 2022, CRA issued a written ruling that the transaction was exempt from HST. The ruling also stated that CRA is bound by the ruling, subject to the qualifications and guidelines set out in CRA’s GST/HST Memorandum 1.4, Excise and GST/HST Rulings and Interpretations Service, including the qualification that “all relevant facts and transactions have been fully and accurately disclosed.”

[18] After the ruling was issued, the respondents’ tax counsel made an inquiry to CRA about the respondents’ making their own request for a tax ruling. Counsel was advised that real property buyers were unable to request CRA rulings regarding the tax treatment of real property sales, the rationale being that it was the seller rather than the buyer who would have access to the information required to make the ruling request.

[19] After receiving the CRA ruling, the applicant requested that the respondents readjust the purchase price in accordance with the undertaking by paying to the applicant the amount by which the sale proceeds had been reduced on closing. The respondents refused to do so, as explained further below in these reasons under the headings “Parties positions” and “Alleged deficiencies in ruling request”.

[20] After acquiring the property, 576 Ontario entered into a new farm lease with Chamberlain Acres. While settling the lease’s terms in March 2022, Ms. Chamberlain advised Mr. Matrundola by email that the applicant collected HST for the farm rental, the annual rent being $1,800 plus HST. In a subsequent email to Mr. Matrundola in October 2022, Ms. Chamberlain revised that information, stating that the applicant did not charge HST on the $1,800 rental amount paid in 2020, being the only rent payment they made to the applicant.

[21] On November 30, 2022, the applicant brought a Notice of Application, seeking to enforce the undertaking. On August 11, 2023, the respondents provided a Responding Application Record, opposing the application.

III. Parties’ positions

[22] As a preliminary matter at the application hearing, I asked respondents’ counsel to identify the respondents’ economic interest in the outcome of this application, given the following sequence of events (as I understood them). The respondents agreed to pay the applicant over $3.3 million for the applicant’s property. Upon closing, the amount they paid was closer to $3 million. The balance of the purchase price was either due to CRA (if the transaction was subject to HST) or due to the applicant (if the transaction was HST exempt). Either way, the respondents do not get to keep the money, which has been available for their use since closing pending disposition of this application. In these circumstances, what legitimate economic interest do the respondents have in the application’s outcome?

[23] In the explanation I received, a key consideration was the parties’ HST registration status under Part IX of the ETA entitled “Goods and Services Tax”.

[24] Businesses in Canada, with certain exceptions, are required to charge, collect and remit HST or other applicable sales taxes. The obligation arises in connection with making a “taxable supply”, which may include a sale or lease of real property in the course of a commercial activity: ETA, s. 123(1). Under s. 240(1), subject to certain exceptions, every person who makes a taxable supply in Canada in the course of a commercial activity is required to be registered under the ETA. The respondent 576 Ontario is registered under the ETA. The applicant is not (although the respondents argue that she is a deemed HST registrant, as noted below under the heading “HST registration status”).

[25] The respondents submit that if the sale of the applicant’s property was a taxable supply, the obligation to remit HST would fall upon 576 Ontario. It would be required to self-assess and remit to CRA the amount of HST payable. It would be liable to CRA if it failed to do so. That is the respondents’ economic interest in the application’s outcome.

[26] The applicant’s counsel did not dispute that explanation. However, while the explanation provides useful background, both sides agreed that it was not relevant to the application’s outcome.

[27] The applicant submits that an order should issue requiring the respondents to comply with the undertaking by paying the applicant the balance of the purchase price withheld on closing. As set out in the undertaking, the applicant applied for a tax ruling, requesting confirmation that the transaction was not subject to HST. The CRA ruled in the applicant’s favour. The ruling was based on the information set out in the ruling request or subsequently provided to CRA at their request. The applicant says that the information provided was accurate and complete. Therefore, the respondents are required to readjust the purchase price and pay the applicant the balance of the purchase price in accordance with the undertaking.

[28] The respondents disagree. They submit that CRA is not bound by the ruling because the information the applicant provided to CRA relating to commercial activity on the property was “untrue, inaccurate or incomplete.” They say that to comply with the undertaking’s terms, the applicant was required to submit a ruling request based on accurate information. They ask the court to make a finding of fact that if the applicant had provided accurate information, CRA would have found that the transaction was subject to HST. By providing inaccurate information, the applicant failed to act honestly in the performance of her contractual obligations under the undertaking: see CM Callow Inc v Zollinger, 2020 SCC 45, 452 D.L.R. (4th) 44, at paras. 3, 54. On that basis, the respondents say that the undertaking is not enforceable against them.

[29] In the course of oral submissions by respondents’ counsel, they acknowledged the respondents’ agreement that if the facts provided to CRA were true, accurate and complete, the tax ruling would be binding and the respondents would be required to pay the balance of the purchase price to the applicant, as required by the undertaking. They also say that it is still open to the applicant to comply with the undertaking’s terms by making another ruling request that provides true, accurate and complete information to CRA.

IV. Alleged deficiencies in ruling request

A. Information disclosed in ruling request

[30] To consider the merits of the parties’ positions, it is useful to set out in further detail the information provided to CRA in connection with the ruling request as well as the deficiencies that the respondents allege.

[31] The information set out in the tax ruling request included the following:

a. The applicant leased 30 acres of the property to a local farmer and received a single annual payment of $1,800, an amount that was greatly exceeded by maintenance and ownership costs for the property.

b. The property also contains a residential structure in which the applicant resided for the previous five years. The remaining land was vacant and used by the applicant only for personal/recreational purposes.

c. Other than the rental activity mentioned above, the applicant “has not used the Property in a business or in the course of an adventure or concern in the nature of trade”, [2] noting for clarity that the applicant herself had not conducted farming activities on the property.

d. The applicant undertook several projects to restore the property, during which she temporarily placed storage bins on the property to assist with the disposal of old fencing, tires, dead trees and discarded material left on the property.

e. On occasion, the applicant stored her personal vehicles and a snowplough on the property for personal use and property maintenance.

f. The applicant is not registered for GST/HST.

[32] Among other things, the respondents say that the information in the ruling request was inaccurate in the following respects:

a. Commercial activity on the property: The ruling request was inaccurate in stating that the property was not used for business purposes in light of commercial activity that took place on the property that was not disclosed to CRA.

b. HST registration status: The ruling request was inaccurate in stating that the applicant was not registered for HST. The applicant is an “HST registrant” within the meaning of the ETA.

[33] I will address each of these matters in turn.

B. Commercial activity on the property

[34] The respondents submit that the ruling request was inaccurate in stating that the property was not used for business purposes in light of commercial activity that took place on the property that was not disclosed to CRA.

[35] In s. 123(1) of the ETA, “commercial activity” of a person is defined is as follows:

(a) a business carried on by the person (other than a business carried on without a reasonable expectation of profit by an individual …), except to the extent to which the business involves the making of exempt supplies by the person,

(b) an adventure or concern of the person in the nature of trade (other than an adventure or concern engaged in without a reasonable expectation of profit by an individual …), except to the extent to which the adventure or concern involves the making of exempt supplies by the person, and

(c) the making of a supply (other than an exempt supply) by the person of real property of the person, including anything done by the person in the course of or in connection with the making of the supply;

[36] An “exempt supply” includes a “supply of real property made by way of sale by an individual” unless immediately before the transfer, the real property was capital property that was (i) used primarily in a business carried on by the individual with a reasonable expectation of profit, or (ii) if the individual is an HST registrant, used primarily in making taxable supplies of real property by way of lease, or in any combination of uses described in paragraph (i) above: ETA, Sched. V, Part 1, s. 9(2).

[37] The respondents argue that the applicant’s lease of the “farm portion” of the property to Chamberlain Acres was a “commercial activity” as defined in s. 123(1)(c) the ETA. In that regard, the respondents submit that the supply of real property by way of lease constitutes “commercial activity” even if it is not carried on with a reasonable expectation of profit.

[38] The respondents also submit that the applicant herself, through Miller Bins and Pro Landscape, was carrying on “commercial activity” on the property. They also argue that by reason of that commercial activity, the property’s sale would not constitute an “exempt supply of real property” if the applicant used the property primarily for her business carried on with a reasonable expectation of profit: see ETA, Sched. V, Part 1, s. 9(2)(a)(1). As a result, the property’s sale would be subject to HST.

[39] To support their position that the applicant was carrying on commercial activity on the property, the respondents rely on the following evidence from the cross examination of the applicant on her affidavit:

a. Miller Bins’ business is owning bins and renting them out;

b. Pro Landscape’s business is cutting grass and snowplowing as well as owning bins and renting them out;

c. Miller Bins and Pro Landscape together own a total of 24 bins;

d. In a marketing video arranged by the applicant’s realtor, there were 12 or 14 bins present on the property at that time, as well as two personal vehicles of the applicant and a vehicle owned by Pro Landscape and used in its business;

e. Neither Miller Bins nor Pro Landscape had an office apart from the desk and printer in the applicant’s residence; and

f. Profile Reports (available from the Ontario Ministry of Public and Business Service Delivery) listed the property’s address as the “Principal Place of Business” of Miller Bins and the “Registered or Head Office Address” of Pro Landscape.

[40] The respondents also rely on other evidence that they say establishes that the applicant’s two businesses and her personal life were so intertwined that her statements denying she used the property for commercial purposes were not credible. Among other things, the respondents focus on the 12-14 bins present on the property in the marketing video (half the number that her businesses owned), which the applicant deposed were there for her personal use arising from restoration work on the property.

[41] The applicant submits that she correctly advised CRA that she used the property for residential and personal purposes and not for commercial purposes. She says that the information included in the ruling request and subsequently provided to CRA at its request was accurate and complete, including the information about her activities on the property and the leasing arrangements with Chamberlain Acres.

[42] In her evidence, the applicant acknowledged that consistent with her status as a small business owner, she worked from “my bed or my kitchen table or from Tim Hortons or in the truck wherever it may be”, rather from separate business premises. She also acknowledged that both Miller Bins and Pro Landscape were in the business of renting bins to customers but denied storing those bins on the property, stating that she used various rental facilities for that purpose. She also explained that the occasional presence of bins on the property was for personal use in connection with restoration work on the property, as disclosed in the ruling request. The applicant submits that the respondents have no reliable evidence to the contrary, their position being based on conjecture and speculation.

[43] The applicant also argues that the respondents were at liberty to conduct due diligence with respect to the applicability of HST to the transaction prior to waiving the due diligence condition but did not do so.

C. HST registration status

[44] The respondents submit that the ruling request was inaccurate in stating that the applicant was not registered for HST. They say that the applicant is an “HST registrant” within the meaning of the ETA.

[45] As previously noted, subject to certain exceptions, every person who makes a taxable supply in Canada in the course of a commercial activity is required by s. 240(1) of the ETA to be registered for the purposes of collecting and remitting HST under Part IX of the ETA. The exceptions to the registration requirement include the following: where the person is a “small supplier” (s. 240(1)(a)), and where the person’s only commercial activity is the making of supplies of real property by way of sale otherwise than in the course of a business (s. 240(1)(b)).

[46] In general terms, a person qualifies as a “small supplier” if the value of the revenue for taxable supplies due to that person or an associate of that person does not exceed $30,000 in any single quarter, or in the four calendar quarters immediately preceding the relevant quarter: ETA, s. 148(1). A person other than a corporation is associated with a particular corporation if that particular corporation is controlled by the person: ETA, s. 127(2).

[47] Pro Landscape is registered under Part IX of the ETA. Given the nature of Pro Landscape’s business activity and its own level of revenue ($150,000-$250,000 annually), there is no dispute that it would not qualify as a “small supplier” and is not otherwise exempt from registration under the ETA.

[48] The applicant is not registered under the ETA. The evidence indicated that her sole proprietorship Miller Bin’s annual revenue was in the range of $15,000 to $25,000, which considered on its own would fall within the revenue threshold required to meet the definition of a “small supplier”.

[49] Nonetheless, the respondents submit that the applicant is required to be registered under s. 240(1) of the ETA. They argue that in the course of Miller Bins’ bin rental business, the applicant makes a “taxable supply in the course of a commercial activity”, as defined in s. 123(1), since it provides goods or services for sale or lease in the course of a business carried on with a reasonable expectation of profit. Since the applicant is not otherwise exempt from registration, the applicant is required to register unless she qualifies as a “small supplier”. To determine whether she qualifies, the respondents submit that it is necessary to aggregate Miller Bins’ revenue with that of Pro Landscape, since the applicant is an associate of Pro Landscape as its controlling shareholder: see ETA, ss. 127(2), 148(1). When those revenue amounts are combined, the applicant would not qualify as a “small supplier”, with the result that she would be required to be registered for HST.

[50] The respondents further submit that by reason of the definition of “registrant” in s. 123(1) of the ETA, the applicant is deemed to be an HST registrant. Under s. 123(1), registrant means “a person who is registered, or who is required to be registered, under Subdivision D of Division V” (emphasis added), which includes s. 240(1).

[51] The applicant represented in the ruling request that she was not registered for HST but did not disclose that she was a deemed HST registrant by reason of being an associate of Pro Landscape, which was itself registered for HST. On that basis, the respondents submit that the information the applicant provided to CRA was not accurate or complete.

[52] The applicant submits that the question of whether she is a deemed HST registrant is not a relevant issue in this application. The obligation to collect and/or remit HST arises in respect of a “taxable supply”. The sale of real property is a “supply” of real property which may give rise to an obligation to collect and/or remit HST if it is a “taxable supply”. The applicant argues that whether or not the applicant is an HST registrant does not determine or imply that every supply by her is a taxable supply.

[53] A taxable supply is defined as a supply made in the course of a commercial activity, which does not include a supply that is an “exempt supply” of real property. The applicant says that the property sale was not made in the course of a commercial activity, since as a factual matter she did not use the property for business purposes. She also argues that the respondents cannot establish that the sale of the property in this case is not an exempt supply, which would require that the property be capital property she used primarily for business purposes, the determination of which is likely outside the jurisdiction of this court. The applicant notes that CRA’s GST/HST Memorandum 19.5, Land and Associated Real Property, published by CRA contains guidelines for determining whether capital real property is used primarily in a business.

V. Analysis and conclusion

[54] Despite the parties’ conflicting positions on the issues outlined above, the parties agree that the purpose of this application is to determine whether the respondents are required to comply with the terms of the undertaking given in connection with a real estate transaction. The court is not being asked to determine whether the transaction is subject to HST under Part IX of the ETA. As the parties acknowledge, whether the transaction is subject to HST is a matter within the purview of the Tax Court of Canada, which has exclusive original jurisdiction to hear and determine references and appeals to that court on matters arising under Part IX the ETA as well as questions referred to that court under the ETA: Tax Court of Canada Act, R.S.C. 1985, c. T-2, ss. 12(1), 12(3).

[55] While there is fundamental agreement on the latter point, the findings this court is being asked to make in this application test the limits of the court’s jurisdiction. For example, as noted previously, the respondents ask the court to find that the applicant’s ruling request failed to provide CRA with complete and accurate information. Doing so may involve a determination of what information should have been provided to comply with the requirements of the ETA, a task this court is ill-equipped to undertake. The respondents go further, asking for a finding of fact that had the applicant provided complete and accurate information, CRA would have found the transaction was subject to HST. I do not consider it appropriate to make a finding of that nature, given this court’s jurisdictional ambit.

[56] To determine the matters in issue in this application, the preferred approach is to focus on the terms of the undertaking itself in the circumstances in which it was given. To recap, prior to the transaction’s closing, the parties had conflicting views about the application of HST to the transaction and decided to defer the issue until after closing. As set out in the undertaking, the amount that the respondents were required to pay on closing was reduced by the amount that the respondents calculated would be the tax payable if the transaction were subject to HST. The applicants would request a tax ruling as to the applicability of HST. The parties would be bound by the results of that tax ruling, but with certain qualifications set out in the undertaking.

[57] First, the undertaking expressly provided that it was open to the respondents to make their own independent enquiry to CRA and obtain their own tax ruling.

[58] Second, as previously noted, the obligation to readjust the purchase price in accordance the tax ruling (and provide appropriate funds to the applicant within 48 hours) was qualified by the wording that “bearing in mind that the buyer may have also obtained a written opinion as to the applicability of H.S.T. in this transaction which, if it differs from that of the seller’s written opinion, will then require further discussion, negotiation and agreement.”

[59] In addition to another tax ruling or a written tax opinion, the applicant’s counsel suggests a third option of a similar nature, that is, asking CRA for a “technical interpretation” as to HST applicability based on a stated set of facts.

[60] The respondents argue that none of those alternatives is practically open to them. Their tax counsel made inquires to CRA about obtaining their own tax ruling but was advised that a buyer did not have standing to request a tax ruling, the seller being the party with the necessary information to make that request. On a similar basis, the respondents argue that it would not be feasible for them to obtain a written tax opinion or a CRA technical interpretation to address the HST issue.

[61] While that may well be the case, the fact is that the undertaking by its terms contemplated either another CRA ruling or a written tax opinion as alternative means of challenging the results the existing CRA tax ruling. There is no evidence to suggest that the applicant misled the respondents as to the efficacy of those alternatives. As previously noted, the respondents had their own independent legal and tax advisers when the undertaking’s terms were settled.

[62] The respondents are instead resisting compliance with the undertaking by challenging the binding nature of the tax ruling, on the basis that all relevant information was not “fully and accurately disclosed” by the applicant.

[63] On the evidence before the court on this application, the applicant has complied with the terms of the undertaking. After closing, the applicant requested a ruling as to the applicability of HST to the transaction. For that purpose, she retained a tax accountant with HST experience, who made the ruling request and also provided additional information that CRA requested. CRA ruled that the transaction was not subject to HST. That ruling is binding on its face, subject to the standard qualifications and guidelines set out in CRA’s GST/HST Memorandum 1.4, including that “all relevant facts and transactions have been fully and accurately disclosed.” As explained below, I am not satisfied on the evidence that CRA is not bound by the ruling, as the respondent alleges. As a result, the respondents are required to comply with the undertaking’s terms by paying the balance of the purchase price to the applicant.

[64] The information provided to CRA in support of the ruling request disclosed the applicant’s use of the property for residential and personal purposes and not for business purposes. It also included disclosure relating to the applicant’s lease of part of the property to Chamberlain Acres for farming purposes, receiving one payment of annual rent. The ruling request also acknowledged and explained the presence of storage bins and vehicles on the property for the applicant’s personal purposes.

[65] The information provided to CRA did not disclose the applicant’s business activities through Miller Bins or Pro Landscape. However, as argued by the applicant, I am not satisfied on the evidence that the applicant carried on commercial activities on the property. I accept the applicant’s evidence relating to her use of the property for residential and personal purposes. As already noted, her lease to Chamberlain Acres was disclosed to CRA.

[66] The information provided to CRA did not include reference to Pro Landscape’s status as an HST registrant or the applicant’s alleged status as a deemed registrant. However, as argued by the applicant, I am not satisfied on the evidence that Pro Landscape’s HST registration status or the applicant’s alleged status as a deemed registrant was relevant information the omission of which caused the information the applicant provided to be inaccurate or incomplete.

VI. Disposition and costs

[67] For the above reasons, the application is granted. Judgment will issue ordering the respondents to pay the sum of $255,973.45 to the applicant, as required by the undertaking. The respondent is also ordered to pay the applicant pre-judgment interest commencing March 4, 2022 and post-judgment interest from today’s date, in each case at the statutory rate.

[68] The parties have each provided a bill of costs and have agreed that the appropriate amount of partial indemnity costs would be $30,000. However, the parties have not agreed on how costs should be calculated or paid in this case because of one or more offers made prior to the application hearing.

[69] If the parties are unable agree on costs, each side may serve and file brief written costs submissions (not to exceed three pages) together with any relevant offer within 14 days. Each side may respond by brief written submissions within a further seven days. Submissions are to be provided by email to the Civil court office and uploaded to CaseLines. If no submissions are received within the specified timeframe, the parties will be deemed to have settled costs.

R. A. Lococo J.

Released: January 3, 2024.

Footnotes

[1] In some provinces including Ontario, HST replaced the federal Goods and Services Tax (“GST”) and the provincial sales tax as a single harmonized tax, which the Canada Revenue Agency administers and collects in accordance with Part IX of the ETA entitled “Goods and Services Tax”.

[2] This language tracks wording in the definition of “commercial activity” in s. 123(1) of the ETA (see below under the heading “Commercial activity on the property”).