BETWEEN:
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ASSESSMENT OF COSTS - REASONS
Assessment Officer
[1] This appeal from a consent judgment of the Tax Court of Canada allowing James Venneri's appeals in part for three taxation years and dismissing his appeals for two other taxation years was dismissed with costs on February 8, 2005 (the Judgment). I issued a timetable for written disposition of the assessment of the Respondent's costs. The Appellant's mother, Rose Venneri, asserts that the transmission of my directions to the Appellant, in care of herself to the address for service set out in the instituting document, constitutes insulting behaviour, harassment and intimidation which must stop immediately. As well, she asserts that she has informed the Registry several times that the Appellant is engaged in medical studies out of the country for two or three years, that she no longer represents his interests and that he has not been served with the costs materials and my directions.
[2] James Venneri did not sign the instituting document (filed August 18, 2003). Rather, the signature block shows "J. Venneri by R. Venneri" followed by an address for service unchanged throughout this proceeding and then by the identification of Rose Venneri as "agent for the appellant." She attested that she was authorized by her son to act in all matters related to the transactions in dispute (the transactions). Both are lay persons. The order dated September 23, 2003 directed that the Appellant, who was a minor at the time of the transactions, could be represented by his mother. I could not find any documents in the record signed by the Appellant. There is a pattern in the documents signed by Rose Venneri of complaints about stress associated with her health and her doctorate program interfering with her conduct on his behalf. Some allege intimidation and some blame others for her problems in conduct.
[3] Correspondence to and from Rose Venneri sometimes specifies that she is the Appellant's agent and sometimes it does not. That would not generally be of significance relative to an agent serving merely as a conduit for the materials and submissions of the named party litigant. However, my reading of the record is that Rose Venneri is the driving force in this litigation effectively formulating materials and submissions with minimal, if any, consultation with or input from her son. An example of this, by no means exhaustive, is her Response to Status Review Request filed March 24, 2004, the first page of which identifies her as agent for her son. This document is not generally drafted in the third person as if it had been prepared by her as agent for her son as the named Appellant. Rather, it generally is written in the first person and she signed it without specifying that she did so as agent for her son. That would not preclude James Venneri as the creator of its contents with Rose Venneri simply receiving it from him, adding her signature on his behalf and then filing it for him. However, that is not so here. That is, paragraphs 1 to 4 assert generally in the first person that this matter arises from "investments which were registered to me and my son, James, who is now 30 and in medical school outside the country", he was in high school and not working at the time of the transactions, "I have his permission to deal with this matter as I have first-hand information about the funds in question", the transactions "have already been addressed in a Tax Court case, which ruled in my favour", the Respondent subsequently made the transactions a separate issue for her son and "I would be pleased to pay income tax which is warranted, but I am not willing to pay income tax…".
[4] Paragraph 6 then asserts that the Respondent has "attempted to deny my right to appeal…and have denied my right to object to their decision" and that the Tax Court of Canada "ultimately ruled in my favour". This I think refers to an earlier Tax Court of Canada decision not the subject of this appeal. Paragraph 7 asserts that "I expressed my desire to pay appropriate taxes" and then asserts her frustration with the process.
[5] Rose Venneri submitted a notice of motion dated April 7, 2004 for an extension of time to file the Application Record and Requisition for Hearing. This document is drafted in the third person for the Appellant. I read the supporting materials as blaming everyone other than herself for the difficulties giving rise to this application, which was allowed in part. The point is simply that, although the record disclosed some previous difficulties for the Registry in transmitting materials to her, she appeared to still be fully engaged in a process with the potential from her perspective for success. Her supporting materials included her periodic statement throughout that she was authorized to act for her son.
[6] The problem of effecting service on the Appellant was the subject of a motion by the Respondent for security for costs. Reference was made to a letter signed by Rose Venneri (no mention of agent status) asserting that she has "no intention of paying these costs", referring to a recent award of interlocutory costs in the Respondent's favour. This motion was granted in part on June 11, 2004, i.e. for $1,000.00 to be paid into Court as security for costs instead of the $2,986.00 sought. At about this time, Rose Venneri filed the Application Record requisite for hearing. It contains material reinforcing my belief that Rose Venneri, and not James Venneri, was and is driving this proceeding. An example, not exhaustive, is her assertion in paragraph 4 of her affidavit sworn May 31, 2004 that the transactions were made in her name and in the name of her son, in high school at the time, to ensure that he would have access to the funds given her medical problems at the time. Paragraph 17 then asserts that James Venneri "had no material knowledge" of the transactions. I note that it is understandable that, in drafting materials, she might lose sight of the fact that this proceeding supposedly addressed resolution of her son's issues as opposed to her own. Given that the Respondent was pushing at about this time for collection of costs, the reality of a potential lack of success and adverse monetary consequences may have affected her conduct (see her letters dated May 20 and June 7, 2004, blaming the Registry for her liability for costs). Certainly, problems with transmissions of material by the Registry to her subsequently became more frequent.
[7] The record discloses several attempts to contact Rose Venneri about a hearing date. On November 22, 2004, she called the Judicial Administrator (Appeal) to outline her available dates, which included February 1, 2005, the date subsequently set by order for hearing of the appeal. The record discloses that the Judicial Administrator (Appeal) advised Rose Venneri by telephone of said hearing date. I note with interest that James Venneri initially answered at the telephone number for Rose Venneri, but did not take the hearing date information and instead requested that a voice-mail be left for her. The Registry official immediately called back and did so. The Registry's mailing of the order to her was returned by Canada Post and marked unclaimed, as was the Registry's second mailing of said order on January 17, 2005. As above, this reinforces my feeling that the only active step taken by James Venneri in this matter was to permit his mother to use his name as the Appellant so that she could fully engage with the Respondent over her disagreements concerning the transactions. The appeal hearing convened on February 1, 2005, no one appearing for James Venneri, and the matter was taken under reserve. The presiding judge then added a note to the record on February 8, 2005, that he was satisfied with the Registry's notice to Rose Venneri of the hearing date and that the Court would not reconvene further to her informal request to do so. The Court directed that its note and the judgment be sent to her by registered mail and by ordinary mail. The registered mailing was returned marked unclaimed.
[8] By letter dated February 9, 2005, she asserted that she did "not intend to abandon this appeal" and she requested information about how to appeal. There is no indication that her son concurred in or was aware of this. The supporting materials for her motion for reconsideration of the judgment did briefly distinguish between herself and her son, but do not convince me that her son was involved in their preparation. I find it ironic that she had blamed the Registry throughout for shortcomings in conduct on the part of the Appellant, yet when it was convenient in these supporting materials to do so in an attempt to convince the Court of her good intentions as justification to reconvene, she asserted in paragraph 6 of her affidavit sworn February 11, 2005 that various Senior Registry Officers kept her properly informed throughout. On March 11, 2005, the Court dismissed her motion for reconsideration. The Registry transmitted this order to her by facsimile and by mail. The letter was returned unclaimed. Her letter to the Registry dated March 21, 2005, complained of the unfairness of the court process, including the use of registered mail given her inability to get to Canada Post during work hours and medical issues causing her to avoid public places. The Registry pointed her to the Supreme Court of Canada.
[9] The Respondent filed a notice of motion on May 19, 2005, for payment out to the Crown of the $1,000.00 paid into Court on behalf of the Appellant for security for costs. Rose Venneri filed (on June 30, 2005) a motion record opposing payment out on the grounds that James Venneri cannot directly address this matter because of his medical studies in Europe, he is not at fault, he is retaining legal services to investigate alternative process, his preoccupation with his studies precluded him from properly assessing the incompetence or incapacity of Rose Venneri as his representative and a number of other factors. Apparently, in asserting at paragraph 20 that the Registry had "provided incorrect information to the Appellant's representative that resulted in the motion for security and court costs", she had forgotten her recent affidavit (sworn February 11, 2005) that the Registry had kept her properly informed throughout. Her accompanying affidavit sworn June 30, 2005 asserted that, as James Venneri had been too busy with his studies, he was not aware of the details of the proceeding or the medical incapacity of her as his representative. Paragraph 14 of said affidavit asserting negligent advice by the Registry staff directly contradicts paragraph 6 of her affidavit sworn February 11, 2005. The little that I do believe as a function of the aggregate of materials formulated throughout by her on behalf of her son is that he gave her permission to use his name and that he gave little, if any, instructions or input to her. By order dated July 26, 2005, the Court granted the Respondent's motion. Again, the record discloses difficulty for the Registry in transmitting this order to her.
[10] On October 10, 2006, the Respondent initiated process for assessment of costs. The record discloses her letter dated June 7, 2006 to the Respondent's representative asserting that her son will not be able to address the matter of costs until after he finishes his studies and returns to Canada in three years. The Respondent's letter dated June 21, 2006 in response reminded her of her sworn evidence that she had permission to act in all matters related to the transactions, which would include these outstanding costs. Her letter dated July 4, 2006 in response asserted that the June 21, 2006 letter was "threatening, harassing, intimidating, inappropriate and unacceptable", that she no longer represents her son and that there must be no further attempts to contact her about the transactions. She responded to my directions concerning conduct of the assessment in similar fashion with the added assertion that James Venneri has not been served with or received the costs materials, including my directions.
[11] Simply put, I reject her position that the assessment of costs must be delayed. She, by way of her son as the named Appellant, cannot treat court process as a convenient conduit for expression of her dissatisfaction without having to coincidentally bear the associated consequences if imposed as here. Technically, only James Venneri could have designated her as his agent and only he can rescind said designation. Neither can frustrate, at their convenience, the Respondent's rightful access to court process. My reading of the court record is that Rose Venneri alone conceived, initiated and implemented all steps on the part of James Venneri without substantive instruction from and participation by him, other than the granting of permission to use his name. In so concluding, I acknowledge that the transactions giving rise to the relevant Tax Court of Canada decision addressed him alone, but I think that the reality is that she cannot disassociate herself from the events further to which the Respondent has received costs. I am not suggesting that nor is it my role to determine whether Rose Venneri, as opposed to James Venneri, is liable to satisfy any assessed costs. I simply think that she cannot frustrate court process by disengaging at her convenience. I might think differently if James Venneri had removed her as his agent or if there was believable evidence of her incapacity. I also think that, even if James Venneri was not aware of any details of the process conducted in his name, he had to have been aware that it was occurring. I find that proper notice of the assessment of the Respondent's costs has been given.
Assessment
[12] The effect of Rose Venneri's conduct is that the Appellant did not file any materials in response to the Respondent's materials. My view, often expressed in comparable circumstances, is that the Federal Courts Rules do not contemplate a litigant benefiting by an assessment officer stepping away from a position of neutrality to act as the litigant's advocate in challenging given items in a bill of costs. However, the assessment officer cannot certify unlawful items, i.e. those outside the authority of the judgment and the tariff. I examined each item claimed in the bill of costs and the supporting materials within those parameters. Certain items warrant my intervention as a function of my expressed parameters above and given what I perceive as general opposition to the bills of costs.
[13] The Respondent presented a bill of costs further to an order dated March 26, 2004, dismissing the Appellant's motion for an order allowing the appeal. Costs were awarded payable forthwith to the Respondent. The resultant bill of costs dated April 15, 2004 (the 1st bill of costs) included an item 2 claim for preparation of the Respondent's Record for the hearing of the appeal, but no item 21(a) claim for preparation of a motion record. The bill of costs dated May 19, 2005, for the appeal proceeding (the 2nd bill of costs) also included an item 2 claim for the Respondent's record for the hearing of the appeal. It did include an item 21(a) claim for preparation of the motion record (the March 26, 2004 order). By direction of the Court further to statutory requirements, this proceeding had been converted from an application for judicial review to an appeal proceeding. Therefore, although item 2 is not necessarily the appropriate counsel fee item, its amount approximates that for the comparable service in an appeal proceeding and is allowed as presented at $600.00 in the 2nd bill of costs, but is disallowed in the 1st bill of costs. Items 21(a), 22(a) (appearance at the hearing of the appeal) and 25 (services after judgment) are allowed as presented at $360.00, $270.00 and $120.00 respectively. Each bill of costs claims a mid-range value of $480.00 for item 26 (assessment of costs). I allow only 5 units in total at $120.00 per unit (in the 2nd bill of costs) as these assessments were essentially a single process. Disbursements for photocopies are in order and are allowed as presented at $96.00 and $162.40 respectively. The 1st and 2nd bill of costs of the Respondent, presented at $1,086.00 and $1,992.40 respectively, are assessed and allowed at $96.00 and $2,112.40 respectively. A single Certificate of Assessment will issue confirming assessed costs totalling $2,208.40 for the Respondent. Of that, only $1,208.40 remains outstanding and payable by the Appellant to the Respondent given that the $1,000.00 paid into Court by the Appellant as security for costs has already been paid out to the Respondent. Given the difficulties associated with transmission of documents by the Registry to the Appellant, the Registry is instructed to send my decision to the Appellant by registered mail and then again by ordinary mail.
FEDERAL COURT OF APPEAL
SOLICITORS OF RECORD
DOCKET: A-379-03
STYLE OF CAUSE: JAMES VENNERI v. HMQ
ASSESSMENT OF COSTS IN WRITING WITHOUT PERSONAL APPEARANCE OF THE PARTIES
REASONS FOR ASSESSMENT OF COSTS: CHARLES E. STINSON
WRITTEN REPRESENTATIONS BY:
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Steven D. Leckie
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SOLICITORS OF RECORD:
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John H. Sims, Q.C. Deputy Attorney General of Canada
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