Yves Ouellette

The appellant appealed a decision regarding whether a trustee appointed under the Special Corporate Powers Act is required to notify the Minister before realizing on security, pursuant to s. 14 of the Act respecting the Ministère du Revenu.

The Supreme Court of Canada dismissed the appeal, agreeing with the Quebec Court of Appeal that such a trustee is not one of the persons provided for in s. 14 as it was worded at the time of the notice of assessment.

The appellant's premises were searched by officials of the Ministère du revenu pursuant to an authorization approved by a judge of the Court of Sessions of the Peace under s. 40 of the Act respecting the Ministère du revenu.

The appellant challenged the authorization via a writ of evocation, arguing the information was too vague.

The Supreme Court of Canada allowed the appeal, holding that the authorizing judge exercises a judicial function and must carefully scrutinize the ministerial discretion.

Because the information did not disclose the facts underlying the informant's belief, the judge could not verify its reasonableness and failed in his duty by not requesting further information.

The search and seizure were declared null and void.

The appellant corporation was incorporated solely to purchase and hold land as a mandatary for two other companies.

The Minister of Revenue assessed the value of the land as 'paid-up capital' under the Corporation Tax Act and imposed a tax.

The Supreme Court of Canada held that the appellant acted as a nominee (prête-nom) and its obligation to the true owners was not a debt.

Therefore, the value of the land did not constitute paid-up capital, and the assessment was vacated.