BETWEEN:
and
Respondent
Heard at Vancouver, British Columbia, on June 28, 2006.
Judgment delivered from the Bench at Vancouver, British Columbia, on June 28, 2006.
REASONS FOR JUDGMENT OF THE COURT BY: SHARLOW J.A.
Docket: A-671-04
Citation: 2006 FCA 247
CORAM: DÉCARY J.A.
LINDENJ.A.
SHARLOW J.A.
BETWEEN:
RICHARD SOBON
Appellant
and
HER MAJESTY THE QUEEN
Respondent
REASONS FOR JUDGMENT OF THE COURT
(Delivered from the Bench at Vancouver, British Columbia, on June 28, 2006)
[1] We are all of the view that this appeal should be allowed with costs.
[2] The Tax Court Judge made two factual errors. First, he misstated the number of chicks in the year under appeal. Second, he suggested that the appellant had made comments to the effect that the farm could never generate a profit as presently operated. The transcript does not contain any such comment. On the contrary, the appellant testified as to his belief that the farm could be profitable.
[3] These factual errors are sufficiently important, in our view, to vitiate the Judge's conclusion that the appellant had not satisfied the third Moldowan factor (actual or potential profits).
[4] It is open to the Court to send this matter back to the Tax Court for a rehearing. However, we note that this matter proceeded under the informal procedure of the Tax Court of Canada, and that the appellant has already suffered a lengthy delay in the resolution of this appeal because the Judge did not deliver his judgment within the statutorily mandated time frame.
[5] In the circumstances, we believe the most appropriate remedy is to allow this appeal with costs, set aside the judgment of the Tax Court, allow the appellant's tax appeals with costs, and remit this matter to the Minister for reassessment on the basis that section 31 of the Income Tax Act does not apply to the appellant for the 1997 and 1998 taxation years.
"K. Sharlow"
FEDERAL COURT OF APPEAL
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: A-671-04
APPEAL FROM A DECISION OF THE HONOURABLE MR. JUSTICE LITTLE OF THE TAX COURT OF CANADA DATED JUNE 22, 2004 ON COURT FILE NO.
2002-4897(IT)I
STYLE OF CAUSE: RICHARD SOBON v. HMQ
PLACE OF HEARING: VANCOUVER, BC
DATE OF HEARING: JUNE 28, 2006
REASONS FOR JUDGMENT OF THE COURT BY: DÉCARY, J.A.
LINDEN, J.A.
SHARLOW, J.A.
DELIVERED FROM THE BENCH BY: SHARLOW, J.A.
APPEARANCES:
|
Ms. Lisa J. Helps
|
FOR THE APPELLANT
|
|
Ms. Susan Wont |
FOR THE RESPONDENT
|
SOLICITORS OF RECORD:
|
Lumby, BC
|
FOR THE APPELLANT
|
|
Deputy Attorney General of Canada Vancouver, BC |
FOR THE RESPONDENT
|