Docket: 2025-2127(IT)G

BETWEEN:

THE ESTATE OF THE LATE TROY E. DUCHARME,

Appellant,

and

HIS MAJESTY THE KING,

Respondent.

Motion heard on July 16, 2026 at Toronto, Ontario

Before: The Honourable Justice J. Scott Bodie

Appearances:

Counsel for the Appellant:

Louise Summerhill Stephanie D’Amico Rebecca Skinner

Counsel for the Respondent:

Natasha Tso Erin Strashin

ORDER

WHEREAS the Respondent brought a motion seeking an order to quash an appeal brought by the Appellant;

AND UPON hearing from the parties;

AND UPON review of all material relevant to the within motion;

AND IN ACCORDANCE with the attached Reasons for Order;

IT IS ORDERED THAT:

1. The Respondent’s motion to quash the appeal is dismissed.

2. The Respondent shall have 60 days from the date of the within Order to file a Reply to the Notice of Appeal.

3. Costs of this motion shall be in the cause.

Signed this 12th day of August 2026.

“J. Scott Bodie”

Bodie J.

Citation: 2026 TCC 150

Date: 20260812

Docket: 2025-2127(IT)G

BETWEEN:

THE ESTATE OF THE LATE TROY E. DUCHARME,

Appellant,

and

HIS MAJESTY THE KING,

Respondent.

REASONS FOR ORDER

Bodie J.

I. INTRODUCTION

(a) Positions of the Parties

[1] These reasons relate to the Respondent’s application for an order to quash an appeal brought by the Appellant (the “Estate”). It is the Respondent’s position that:

1. two Notices of Reassessment, dated March 17, 2023, were issued to the Estate by the Minister of National Revenue (the “Minister”) (collectively, the “Notices of Penalty Reassessments”);

2. the Estate did not serve valid Notices of Objection in respect of these penalty reassessments as the Notices of Objection, which the Estate did ultimately file in this matter, were served outside of the time limit prescribed by section 165 of the Income Tax Act (the “Act”), on April 24, 2025;

3. without having served valid Notices of Objection, the Estate did not fulfill a necessary precondition to filing a valid appeal pursuant to subsection 169(1) of the Act;

4. accordingly, the Estate’s appeal must be quashed.

[2] Unless otherwise indicated, all statutory references herein are to the Act.

[3] On the other hand, it is the Estate’s position that the Notices of Objection which were filed on April 24, 2025, are valid because the Notices of Penalty Reassessments were not mailed to the Estate prior to March 3, 2025. The Estate then filed its Notice of Appeal to this Court following the expiration of 90 days after it filed valid Notices of Objection, and prior to the time the Minister either confirmed or reassessed the Notices of Penalty Reassessments.

(b) Statutory Regime

[4] Subsection 165(1) provides that a taxpayer may object to a reassessment on or before the day that is 90 days after the mailing of a Notice of Assessment or Reassessment (“Notice of Assessment”). If the taxpayer misses this deadline, the taxpayer may apply to the Minister for an extension of time to serve a Notice of Objection under subsection 166.1(1). However, under paragraph 166.1(7)(a) that application must be made within one year after the end of that original 90‑day period (the “One year plus 90‑day period”).

[5] If the Minister refuses the application to extend, or fails to notify the taxpayer of its decision within 90 days of the service of the application, the taxpayer may apply, under subsection 166.2(1) to this Court to have the extension granted. However, if the Minister has refused the application, the application to this Court must be made within 90 days of the day on which notification of the Minister’s decision is mailed to the taxpayer; and in any event, the taxpayer’s application under subsection 166.1(1) to the Minister must have been made within the One year plus 90‑day period.

[6] If these deadlines are all missed the taxpayer has no further avenues available. The taxpayer is unable to file a Notice of Objection.

[7] Further, while a taxpayer may appeal an assessment to this Court, one of the preconditions to being able to bring such an appeal is that the taxpayer first serves a Notice of Objection under subsection 165(1). Accordingly, if all the deadlines described above for the proper filing of a Notice of Objection are missed, the taxpayer is unable to appeal an assessment to this Court.

II. ISSUE

[8] The triggering date for determining all such deadlines is the date that the Notice of Assessment is sent or mailed to the taxpayer. Therefore, the issue in this application is: what date were the Notices of Penalty Reassessments mailed to the Estate? If, on a balance of probabilities, they were mailed to the Estate on March 17, 2023, as advocated by the Respondent, then all the deadlines for the valid filing of a Notice of Objection were missed, and the appeal must be quashed in accordance with paragraph 53(3)(b) of the Tax Court of Canada Rules (General Procedure). For a precondition to instituting an appeal was not met. However, if on a balance of probabilities, they were mailed to the Estate on or after March 3, 2025, as advocated by the Estate, then the Estate filed valid Notices of Objection within one of the applicable deadlines, and the appeal may therefore proceed under subsection 169(1).

III. ANALYSIS

(a) What date were the Notices of Penalty Reassessments mailed to the Estate?

A. Legal Test

[9] Courts have developed a well‑established, four‑step process to be followed where there is a dispute over the date of mailing of a Notice of Assessment. The steps are:

1. Step 1: The taxpayer must assert that the Notice of Assessment was not mailed. Generally, a taxpayer will assert that the notice was not received and therefore believes that it was not mailed. Alternatively, the taxpayer may assert that the notice was mailed to the wrong address by the Canada Revenue Agency (the “CRA”) and therefore was, in effect, not mailed to the taxpayer.

2. Step 2: If the taxpayer asserts that that the notice was not mailed, the Minister must introduce sufficient evidence to prove, on a balance of probabilities, that the notice was mailed, or if applicable, mailed to the proper address the CRA had on file.

3. Step 3: If the Minister is able to prove that the notice was mailed, then the notice is presumed under subsection 244(14) to have been mailed on the date set out on the notice. As this presumption is rebuttable, the taxpayer may introduce evidence to prove that the mailing occurred on a different date.

4. Step 4: Once the mailing date is so established, the notice is deemed to have been received on that date under subsection 248(7). As a result of this deeming provision, which is not rebuttable, by the time that this step is reached, the issue of whether or not the taxpayer actually received the notice is no longer relevant.

(Mpamugo v. R, 2016 TCC 215, upheld on appeal at 2017 FCA 136; Boroumend v. R, 2016 TCC 256, upheld on appeal at 2017 FCA 245; Sodecia Canada Investments Inc . v R, 2024 FCA 216; Simon Ribbans Photography Inc v. R, 2025 TCC 146).

[10] I will now apply each of the applicable steps in turn.

A. Has the taxpayer asserted that the Notices of Penalty Reassessments were not mailed?

[11] The Estate relies on affidavit evidence from the trustee of the Estate, Robin Ducharme and the Estate’s advisor at Deloitte LLP (“Deloitte”), Ingrid Reynolds in asserting that the Estate did not receive the Notices of Penalty Reassessments on March 17, 2023, as advocated by the Respondent. In her affidavit, Ms. Ducharme attests as follows:

1. As trustee of the Estate, she routinely receives, retains and provides copies of documents relating to the Estate’s affairs to its advisors, including correspondence received from the CRA.

2. During her time as the trustee of the Estate, the mailing address on file for the Estate with the CRA has been her personal residence in Victoria, British Columbia, and that is the address at which the Estate has consistently received CRA correspondence.

3. She organizes all Estate documents by date of receipt, with the most recent documents filed first, and maintains them in a physical file in her home. In addition to maintaining these physical files, she always forwards electronic copies of the relevant documents to the Estate’s legal and accounting advisors.

4. Throughout her time as trustee of the Estate, her principal contact at Deloitte, the Estate’s accounting advisor, has been Ms. Reynolds. Deloitte prepared notices of objection in response to notices of reassessment issued by the Minister on March 7 and 8, 2023 (the “Primary Reassessments”).

5. Other than the Primary Reassessments, Ms. Ducharme did not receive any CRA notices of assessment or reassessment for the Estate prior to 2025 and understood that neither Ms. Reynolds nor Deloitte received the Notices of Penalty Reassessments until after they came to light in 2025.

[12] I will explain how Ms. Ducharme says the Notices of Penalty Reassessments came to her attention below.

[13] In her affidavit, Ms. Reynolds attests that:

1. She is an accountant and a Business Tax partner in the Tax and Legal business line at Deloitte, where she has worked for 19 years, routinely assisting clients with audits, objections and collection matters, including the Estate.

2. As part of her engagement with the Estate, she prepared and filed Notices of Objection to the Primary Reassessments.

3. She had received the Primary Reassessments from the CRA auditor, Russ Lyons via fax in 2023.

4. Throughout the period from March 17, 2023, to January 2025, she did not receive any communications from the CRA indicating that a multi‑million‑dollar balance had been assessed, was payable and was not under objection by the Estate. Prior to January 2025, she was only aware of the Primary Reassessments.

[14] The Respondent did not challenge the affidavit evidence of either Ms. Ducharme or Ms. Reynolds and I understand that neither were cross‑examined on their respective affidavits. Accordingly, the Estate has indeed asserted that the Notices of Penalty Reassessments were not received in 2023 and therefore believes that they were not mailed on March 17, 2023, as advocated by the Respondent. I will therefore move to Step 2.

B. Has the Minister proved, on a balance of probabilities, that the Notices of Penalty Reassessments were mailed to the Estate?

[15] To address this issue, the Respondent entered into evidence the following four affidavits:

1. Affidavit sworn by Caroline Ariola, who is the Team Leader in the Manual Production Section of the CRA at the Winnipeg Tax Centre (the “Ariola Affidavit”);

2. Affidavit sworn by Nicole Perez, who is a Team Leader in the Individual Returns Division, Post Assessing – T1 Adjustments & T1/T3 Accounts Control Section of the CRA at the Winnipeg Tax Centre (the “Perez Affidavit”);

3. Affidavit sworn by Indy Rehal, who is the manager of the Mail Operations section of the CRA at the Winnipeg Tax Centre (the “Rehal Affidavit”); and

4. Affidavit sworn by Emily Halliday, who is a Litigation Officer in the Tax and Charities Appeals Directorate of the CRA (the “Halliday Affidavit”).

[16] The Act recognizes, and makes some allowance for, the difficulties faced by the CRA in having to prove that an assessment has been mailed, given the size of its operations and the huge volume of correspondence it must mail to millions of Canadians each year. As Justice Graham noted in Mpamugo at paragraph 12, subsection 244(10) somewhat eases the path for the Respondent to prove mailing, provided certain conditions are met. It provides that if an officer of the CRA swears an affidavit stating that the officer has charge of the appropriate records, has knowledge of the practices of the CRA, has examined those records, and those records show that a Notice of Assessment has been mailed, those statements shall, absent proof to the contrary, be evidence that the Notice of Assessment was mailed.

[17] In situations where the affidavit of a CRA officer does not comply with the requirements of subsection 244(10), the Court must weigh the evidence provided by the Minister against the evidence provided by the taxpayer to determine whether it is more likely than not that that the Notice of Assessment was mailed (DaSilva v. R, 2018 TCC 74 at paragraph 9).

[18] It is the Respondent’s position that the Halliday Affidavit meets all the requirements of subsection 244(10), and therefore under that subsection constitutes sufficient evidence to establish that the Notices of Penalty Reassessments were mailed. Step 2 in the view of the Respondent, is therefore satisfied. As set out above, if Step 2 is satisfied then under Step 3, the Notices of Penalty Reassessments are presumed to have been mailed on the date set out in the Notices in accordance with subsection 244(14). The date set out in such Notices is March 17, 2023.

[19] Alternatively, the Respondent submits that if this Court finds that the Halliday Affidavit does not meet the requirements of subsection 244(10), then the totality of the four affidavits adduced into evidence by the Respondent are sufficient to establish that it is more likely than not that the Notices of Penalty Reassessments were mailed. Step 2 would then, in the view of the Respondent be satisfied.

1. Does the Halliday Affidavit meet the Requirements of subsection 244(10)?

[20] In my view, the Halliday Affidavit does not meet the requirements of subsection 244(10). In her affidavit, Ms. Halliday attests that she has charge of the appropriate records, has knowledge of the practices of the CRA and that she carefully examined and searched those records. Accordingly, the preliminary requirements of subsection 244(10) are met. However, the most important requirement for purposes of this application is that the affidavit set out that “an examination of those records shows that a notice of assessment for a particular taxation year…was mailed…”.

[21] In my view, the Halliday Affidavit does not meet this requirement. In her affidavit, Ms. Halliday makes the following two statements:

1. A search of the CRA’s records shows that on March 17, 2023, the Minister of National Revenue (the “Minister”) assessed the Appellant a penalty for failure to file a return on Form T1134 with respect to the 2014 taxation year and accordingly issued a notice on that date (“T1134 Notice”). Attached as EXHIBIT “A” to this affidavit is an electronic reproduction of the T1134 Notice.

2. A search of the CRA’s records shows that on March 17, 2023, the Minister assessed the Appellant a penalty for failure to file a return on Form T1135 with respect to the 2014 taxation year and accordingly issued a notice on that date (“T1135 Notice”). Attached as EXHIBIT “B” to this affidavit is an electronic reproduction of the T1135 Notice.

[22] The requirement in subsection 244(10) is clear. To receive the benefit of that subsection, the affiant must attest that the notice at issue was “mailed”. As the Respondent chose not to produce Ms. Halliday as a witness at the hearing of this motion, as the Respondent was entirely entitled to do, I only have the words set out in the affidavit by which to make a determination.

[23] When the issue is whether or not the Notices of Penalty Reassessments were “mailed”, and subsection 244(10) specifically requires a statement that the notices in question were “mailed”, I find it very curious that the key statement in the one affidavit produced by the Respondent to meet the requirements of subsection 244(10), uses the word “issued” rather than “mailed” or even the word “sent”. For while the word “issue” could mean “sent”, it could just as easily mean “published”. The Canadian Oxford Dictionary (Second Edition) contains both meanings as possible definitions of the word “issue”.

[24] When I asked counsel for the Respondent at the hearing of this motion if she knew what Ms. Halliday meant when she used the word “issued”, counsel admitted that the meaning of the word “issued” in the Halliday Affidavit was less than clear. Under the circumstances, I am not prepared to read the word “issued” to mean “mailed”. The Halliday Affidavit does not meet the requirements of subsection 244(10).

2. Is it more likely than not that the that the Notices of the Penalty Assessments were mailed?

[25] As mentioned above, it is the Respondent’s position that with the assistance of the presumption contained in subsection 244(14), the totality of the evidence contained in the four affidavits the Respondent introduced into evidence establishes, that it is more likely than not that the Notices of Penalty Reassessments were mailed and therefore after moving to step 3 are presumed to have been mailed on the date of such Notices, March 17, 2023.

[26] For the Court to determine whether it agrees with this position, it is necessary for the Court to weigh the evidence adduced by the Respondent against the evidence provided by the taxpayer. I do so below.

[27] In the Ariola Affidavit, Ms. Ariola explains the notice production process for manual notices at the Winnipeg Tax Centre. She then attests that after reviewing the records available and based on her understanding of the practices at the Winnipeg Tax Centre relating to the printing of notices, she believes that the usual procedures at that Winnipeg Tax Centre were followed with respect to the printing of the Notices of Penalty Reassessments.

[28] Ms. Ariola attached to her affidavit as an exhibit a screenshot from the CRA’s Enterprise Correspondence History System which indicates that on March 17, 2023, Penalty (Re)Assessments in respect of the 2014 taxation year addressed to the Estate were “sent”. Ms. Ariola then makes the following statement to explain the meaning of the word “sent” within the context of the Enterprise Correspondence History System:

For T1 manual Notices of Reassessment an activity status of “Sent” indicates that the notice was printed. The activity status of an item is automatically updated to “Sent” once a correspondence item has been printed using the ECO system.

[29] In the Perez Affidavit, Ms. Perez describes the system for moving printed Notices of Assessment and Reassessment from the Manual Production Team to the Control area, where the notices are handled before being picked up and brought to the mailroom at the Winnipeg Tax Centre. She sets out the various control procedures that are followed by the CRA following this system. She describes one of the steps in this system as follows:

A second Control Clerk then inserts the Notice or Notices into an envelope. This second Control Clerk sorts the stuffed envelopes in accordance with the date printed on the Notice and bundles them together in batches of approximately 25 or 50 envelopes. Each batch is bundled together with a summary page (a “Batch Header”) that includes, among other information, the date printed on the Notice which is the date that the Notices are to be mailed. Notices with different dates printed on them would not be bundled together.

[30] Ms. Perez attests that to the best of her knowledge and information the procedures she describes in her affidavit are identical to the procedures which were followed in the Control Section at the Winnipeg Tax Centre in 2023.

[31] In the Rehal Affidavit, Ms. Rehal describes the procedures utilized in the Winnipeg Tax Centre Mail Operations for metering and mailing outgoing mail. She describes the specific control procedures in place including a Material Handling Clerk who validates the number of pieces of mail in each bundle to ensure that the count matches the number of pieces of mail indicated on the batch header, which is attached to each bundle. She also explains that the Material Handling Clerk performs a daily sweep of the Mail Operations area before Canada Post arrives to pick up the mail to ensure that no outgoing mail was missed.

[32] Ms. Rahal attests that on March 17, 2023, all daily outgoing mail received by the Winnipeg Tax Centre was metered and mailed that same day. She attests that she knows this because, “ever since I became the manager in 2014 there has never been a situation where the mail required to be sent from the Winnipeg TC on any given day has been unable to be metered, prepared and ready for pickup by Canada Post”.

[33] By contrast, in her affidavit, Ms. Reynolds, the accountant for the Estate, attests that in June 2023 she assisted in preparing and filing Notices of Objection to the Primary Reassessments, which resulted in the Estate being assessed for a total of $360,243,548.56.

[34] On January 28, 2025, Ms. Reynolds received a telephone call from the CRA inquiring whether there would be an appeal to the Court, presumably with respect to the Primary Reassessments, or whether the Estate planned to pay the outstanding balance. Ms. Reyolds attests that she replied that an appeal would be launched. The CRA officer then, according to Ms. Reynolds, informed her of the Notices of Penalty Reassessments, to which there had been no objection. The total penalties assessed in these Notices is $15,774,855.36. Ms. Reynolds attests that she then made arrangements with the CRA officer for the Notices of Penalty Reassessments to be mailed to Ms. Ducharme’s address in Victoria, as she was unaware of those assessments. The CRA officer informed her that she could not send the assessments directly to Ms. Reynolds.

[35] In her affidavit, Ms. Ducharme attests that she received the Notices of Penalty Reassessments by mail on March 11, 2025. The covering letter accompanying these Notices was dated March 3, 2025. She attests that she then emailed copies to Ms. Reynolds.

[36] Notices of Objection to the Notices of Penalty Reassessments were filed on behalf of the Estate on April 24, 2025.

IV. CONCLUSION

[37] After reviewing and considering the affidavit evidence submitted by both parties outlined above, in my view, it is more likely than not that the Notices of Penalty Reassessments were not mailed to the Estate prior to March 3, 2025. It is therefore not necessary to consider either of the remaining steps.

[38] The affidavit evidence submitted by the Respondent details the processes and procedures followed by the Winnipeg Tax Centre in producing, metering and mailing a Notice of Assessment. It also outlines the systems the CRA uses to track a Notice of Assessment as it makes its way through these processes. Through these tracking systems the CRA can definitively show that the Notices of Penalty Reassessments were printed. However, after the printing of the Notices, the tracking trail ends. The evidence shows that the CRA has a system of tracking a notice after it is printed and makes its way through the process of being put into an envelope and then moving to Mail Operations in the form of a summary page, known as a batch header. However, the Respondent was unable to produce a specific batch header tracking the Notices of Penalty Reassessments beyond their printing.

[39] On the other hand, the affidavit evidence of both Ms. Ducharme and Ms. Reynolds indicates that they did not become aware of the multi‑million‑dollar penalty reassessments in question until January 28, 2025, when Ms. Reynolds learned of their existence during a telephone call with the CRA. Prior to that, Ms. Reynolds had duly assisted in the preparation and filing of Notices of Objection to the Primary Reassessments to which the Notices of Penalty Reassessments relate. Once she discovered the existence of the Notices of Penalty Reassessments, she immediately arranged for them to be mailed to Ms. Ducharme. Within six weeks of Ms. Ducharme receiving the Notices of Penalty Reassessments on March 11, 2025, the Estate filed Notices of Objection.

[40] The Respondent did not challenge any of these facts through cross‑examination. In my view these facts indicate a pattern of Ms. Ducharme and Ms. Reynolds working together to handle the affairs of the Estate in an organized and diligent manner.

[41] The Respondent introduced evidence which depicted in detail the journey of a notice through the various stages of the Winnipeg Tax Centre in 2023, from the time it is printed through to the time it is ultimately picked up by Canada Post. Yet for all the sophistication of the CRA’s systems, it could not produce evidence of the journey of the specific Notices of Penalty Reassessments beyond their printing, despite the evidence showing that it had the ability to track the journey further through the batch header system. The Respondent could not produce the batch headers related to the specific Notices of Penalty Reassessments. The Respondent could not produce any direct evidence linking the Notices of Penalty Reassessments to a mailing event.

[42] When this evidence of the Respondent is weighed against the unchallenged, seemingly credible evidence of the Estate, that neither its trustee nor its advisor, who had clearly been a point of contact for the CRA in the past, received the specific Notices of Penalty Reassessments until March 11, 2025, I can only conclude that it is more likely than not, that the Notices of Penalty Reassessments were not mailed to the Estate prior to March 3, 2025.

[43] The Respondent’s application to quash the appeal is dismissed. The Respondent shall have 60 days from the date of the within Order to file a Reply to the Notice of Appeal. Costs of this motion shall be in the cause.

Signed this 12th day of August 2026.

“J. Scott Bodie”

Bodie J.

2026 TCC 150

COURT FILE NO.:

2025-2127(IT)G

STYLE OF CAUSE:

THE ESTATE OF THE LATE TROY E. DUCHARME AND HIS MAJESTY THE KING

PLACE OF HEARING:

Toronto, Ontario

DATE OF HEARING:

July 16, 2026

REASONS FOR ORDER BY:

The Honourable Justice Scott Bodie

DATE OF ORDER:

August 12, 2026

APPEARANCES:

Counsel for the Appellant:

Louise Summerhill Stephanie D’Amico Rebecca Skinner

Counsel for the Respondent:

Natasha Tso Erin Strashin

COUNSEL OF RECORD:

For the Appellant:

Name:

Louise Summerhill

Firm:

Aird & Berlis LLP 181 Bay Street, Suite 1800 Toronto, ON

For the Respondent:

Marie-Josée Hogue Deputy Attorney General of Canada Ottawa, Canada