Date: 20010730
Docket: 1999-464-IT-G, 1999-466-IT-G, 1999-467-IT-G, 1999-468-IT-G, 1999-469-IT-G, 1999-472-IT-G, 1999-473-IT-G, 1999-474-IT-G, 1999-475-IT-G, 1999-476-IT-G, 1999-478-IT-G, 1999-479-IT-G, 1999-480-IT-G, 1999-481-IT-G, 1999-484-IT-G, 1999-486-IT-G, 1999-487-IT-G, 1999-488-IT-G.
BETWEEN:
DOUGLAS H. MATHEW, STEVEN M. COOK, EUGENE KAULIUS, CHARLES E. BEIL, 347059 B.C. Ltd., JOHN R. OWEN, AMALIO DE COTIIS, WILLIAM JOHN MILLAR, NSFC HOLDINGS LTD., WARREN J. A. MITCHELL, TFTI HOLDINGS LIMITED, IAN H. PITFIELD, THE ESTATE OF THE LATE LORNE A. GREEN, INNOCENZO DE COTIIS, VERLAAN INVESTMENTS INC., FRANK MAYER, CRAIG C. STURROCK, JOHN N. GREGORY,
Appellants,
and
HER MAJESTY THE QUEEN,
Respondent.
Reasons for order
P.R. Dussault, J.T.C.C.
[1] These reasons are in support of an Order concerning the admissibility in evidence of an expert report filed with the Court and served on the Appellants by the Respondent as well as the admissibility of restricted testimony by Mr. Richard Charles Taylor, the author of the report.
[2] Counsel for the Respondent attempted to have Mr. Taylor recognized as an expert and his report entered as evidence. Mr. Taylor is a chartered accountant and a chartered business valuator with the firm of Low Rosen Taylor Soriano. In his report Mr. Taylor expresses his opinion regarding the commercial and economic rationale for the investment in Class A units of a general partnership known as SRMP. His conclusions and opinion are couched in the following terms at pages 2 and 40 of the report:
(page 2)
Based on my scope of review and analysis and subject to the qualifications, assumptions and restrictions noted herein, in my opinion, a profit-oriented business person acting reasonably would not enter into the transactions, as described herein, in the absence of or excluding income tax considerations. Further, the monetary returns provided by the tax deduction resulting from the investment described herein, greatly exceed the potential returns to be generated from the real estate portfolio.
(page 40)
As stated above, it is my opinion that on a purely commercial basis, a prudent investor would not have purchased the Class A units of SRMP absent other considerations. The Class B units of SRMP however were at nominal cost to the unit holders. Any return on the portfolio would yield a positive return, and quite probably a return in excess of a market rate of return for a real estate investment of this nature. This excessive return would in part be due to the smaller, less than market return demanded by the Class A unit holders.
[3] While Mr. Taylor admitted that he had benefited from the collaboration of one of his partners in reaching his conclusions, he declared that he was in a position to defend fully the opinion stated in the report submitted as evidence. Mr. Taylor explained that he based his opinions on what he called "hypotheticals", as well as on certain assumptions that he had made. According to him, his "hypotheticals" came from various documents listed on page 2 of his report, under the heading Scope of Review, as follows:
i) The transcript of the testimony of Eugene Kaulius at the trial of the OSFC case;[1]
ii) The transcript of the testimony of Stewart Robertson at the trial of the OSFC case;
iii) Discovery productions of the Appellants ("Appellants Common Documents");
iv) Discovery productions of Her Majesty the Queen [of 347059 B.C. Ltd.];
v) Transcripts of the Examinations for Discovery of Messrs. Cook, Mathew, Gregory, Sturrock, Pitfield, Mitchell and Michael De Cotiis;
vi) Answers to undertakings of Messrs. Cook and Gregory in connection with their Examinations for Discovery.
[4] While counsel for the Appellants did not dispute the qualifications of Mr. Taylor as a business valuator, he objected to the admission of his expert evidence on the basis that his report did not fall within the scope of those qualifications. He pointed out that Mr. Taylor arrived at what are in effect some 30 conclusions of fact and law—notably in the Analysis and Issues section of his report—on matters in respect of which Mr. Taylor admitted that he was not in any better position than the Court to draw such conclusions.
Arguments submitted on behalf of the Appellants
[5] Counsel for the Appellants submitted that the leading case on the admissibility of expert evidence is R. v. Mohan, [1994] 2 S.C.R. 9, in which the Supreme Court of Canada set out the following criteria for determining whether expert evidence is admissible, at p. 20:
(a) relevance;
(b) necessity in assisting the trier of fact;
(c) the absence of any exclusionary rule;
(d) a properly qualified expert.
[6] In particular, counsel took issue with the evidence in question on the basis of the criteria of relevance and of necessity in assisting the trier of fact and submitted that the opinion Mr. Taylor was being asked to give was not an expert opinion, although there was expert analysis buried within it. In summary, counsel submitted the following reasons for excluding Mr. Taylor's evidence:
· The opinion essentially goes to the ultimate issue. As a result, the Court should be very careful when it comes to admitting it.
· The opinion is based on a review of transcripts of an entirely different trial and of transcripts of examinations for discovery which are not part of the evidence before the Court.
· It is from what Mr. Taylor believed to be the relevant parts of these documents that he drew the findings of fact on which he based his final opinion. In so doing, he undertook the very function that counsel and the Court play in the litigation process. In basing his opinion on his own findings of fact, Mr. Taylor usurps the function of the Court, and that violates the basic rationale for the admission of opinion evidence.
· Most of the inferences and conclusions in the report do not concern technical matters outside the Court's knowledge and therefore they are not necessary to enable the Court to appreciate the matters in issue due to the technical nature of these matters.
· The remaining part of the report is a matter of arithmetic, which is not beyond the Court's ability, considering the various arithmetical calculations brought out by the Respondent's counsel in cross-examination of the various witnesses.
· The opinion expressed in the report overreaches in that it purports to establish how a reasonable businessperson would behave.
[7] In addition to the Mohan case, counsel referred to RIS-Christie Ltd. v. The Queen, 99 DTC 5087 (F.C.A.), Surrey Credit Union v. Willson, 45 B.C.L.R. (2d) 310 (B.C.S.C.), Emil Anderson Const. Co. V. B.C. Ry. Co., 15 B.C.L.R. (2d) 28 (B.C.S.C.), Yewdale v. Insurance Corp. of British Columbia, 3 B.C.L.R. (3d) 240 (B.C.S.C.), Johnson v. Goldsmid, [1987] B.C.J. No. 2530 (QL) and Adam v. Campbell, [1950] 3 D.L.R. 449 (S.C.C.) to support his contention. He also referred to J. Sopinka, S.N. Lederman and A.W. Bryant, The Law of Evidence in Canada, 2nd ed. (Toronto and Vancouver: Butterworths, 1999), p. 641.
Arguments submitted on behalf of the Respondent
[8] The arguments of counsel for the Respondent consisted mainly of the following propositions:
· The ultimate issue in the present appeals is whether the SRMP purchase transactions were avoidance transactions, i.e. whether they may reasonably be regarded as not having been entered into primarily for bona fide purposes other than to obtain a tax benefit that accrued to the Appellants. However, Mr. Taylor's evidence is directed solely at whether these transactions were ones which profit-motivated businessmen would enter into in the absence of tax benefits. His opinion therefore does not go to the ultimate issue.
· Regardless of whether Mr. Taylor may be said to express an opinion on the ultimate issue, it is well settled that the old rule—namely that no opinion may be expressed on the ultimate issue—no longer applies. (On this point, counsel referred to J. Sopinka, S.N. Lederman and A.W. Bryant, The Law of Evidence in Canada (Toronto and Vancouver: Butterworths, 1992), at pp. 537-46).
· There can be no doubt about the relevance of the evidence proffered by Mr. Taylor.
· The purely commercial and economic rationale of the SRMP transactions is by no means obvious from the documentary evidence in these appeals or from the Appellants' testimony. As a result, Mr. Taylor's knowledge is not only helpful to the Court, it is necessary, particularly with respect to such matters as valuations of return on investment, quantification of expected returns, risk assessment and tax impact.
[9] Counsel also referred the Court to Cotterall v. Canada, [1995] T.C.J. No. 384 (QL), in which Judge Rip of this Court commented on the admissibility of expert evidence written by two persons, only one of whom attended at trial. Counsel referred in particular to para. 13, in which Judge Rip ruled that an expert may give evidence only to the extent that he is in a position to defend fully the report without having to consult with the other writer. Counsel stated that Mr. Taylor has already testified that he is in a position to fully defend the report herein on his own and that his partner's collaboration would therefore not constitute an impediment to the admissibility of his opinion evidence.
[10] With respect to the arguments advanced by counsel for the Appellants, counsel for the Respondent contended that deficiencies in expertise resulting, for instance, in reliance on facts irrelevant to the determination, are to be assessed in determining the weight to be given the expert evidence, not its admissibility. On that point, counsel referred to R. v. Marquard, [1993] 4 S.C.R. 223, in which the Supreme Court of Canada stated, at p. 243, that:
[t]he only requirement for the admission of expert opinion is that the "expert witness possesses special knowledge and experience going beyond that of the trier of fact".
[11] Counsel further submitted that whether Mr. Taylor relied on more facts than he needed in order to express his opinion cannot be determined until Mr. Taylor testifies, since there is no indication as to whether he actually relied on the facts he assumed or as to the extent to which those facts were irrelevant.
[12] With respect to reliance on hypothetical fact situations, counsel quoted the 1992 edition of Sopinka, Lederman and Bryant, supra, at p. 537:
If the expert lacks personal knowledge of the matters in issue, and is called to give an opinion upon certain disputed facts, evidence of which has been or will be led at trial, the opinion may be elicited only through the vehicle of a hypothetical question.
[13] He then quoted the following, from p. 539:
The hypothetical fact situation put to the expert witness must be clear, uncontradictory and proved at trial. The hypothetical question need not include all the facts relevant to the expert's opinion. As long as the question incorporates sufficient assumed facts to enable the witness to give answers of value, it will be proper.
[14] Applying the above to Mr. Taylor's evidence, counsel for the Respondent stated that the transcripts of the examinations for discovery of some of the Appellants as well as the transcripts of the oral evidence at trial in the OSFC case that were given to Mr. Taylor were not evidence before the Court. Therefore, counsel asserted, they represented facts that he was asked to assume and thus constituted hypothetical fact situations at the time Mr. Taylor wrote his expert opinion.
[15] Counsel further submitted that the nature of the source upon which an expert opinion is based has no effect on the admissibility of that opinion. In support of his position, he relied on Saint John (City) v. Irving Oil Co., [1966] S.C.R. 581, in which the Supreme Court of Canada ruled expert evidence admissible even though it was based on information obtained from people who had not been called to testify in the course of the expert's investigation. The Court stated, at p. 592, that:
[a]ny frailties which may be alleged concerning the information upon which the opinion was founded are in my view only relevant in assessing the weight to be attached to that opinion . . . .
[16] Applying the above to Mr. Taylor's evidence, counsel submitted that even if the facts underlying Mr. Taylor's opinion were not proven before the Court, that would only affect the weight to be given to his evidence, and not its admissibility.
[17] In the same vein, counsel relied on R. v. Warsing, [1998] 3 S.C.R. 579, a case in which the Supreme Court of Canada stated, at p. 608:
In many cases the evidence of experts depends on the hypothesis or assumptions that they are asked to make. The value of the opinion will depend on the validity of the assumptions and is related to weight not admissibility.
[18] Alternatively, counsel for the Respondent referred to subsection 145(4) of the Tax Court of Canada Rules (General Procedure),[2] which reads as follows:
(4) Subject to compliance with subsection (2), evidence in chief of an expert witness may be given at the hearing by,
(a) reading the whole or part of the affidavit into evidence by the witness, unless the Court, with the consent of the parties, permits it to be taken as read, and
(b) if the party calling the witness so elects, the verbal testimony of the witness,
(i) explaining or demonstrating what is in the affidavit
or the part that has been given in evidence, and
(ii) in respect of other matters by special leave of the Court, upon such terms as may be just.
[Emphasis added.]
[19] Relying on subparagraph 145(4)(b)(ii), counsel submitted that even if the report completely overreaches and might be flawed in various ways, Mr. Taylor should not be prevented from giving verbal testimony with respect to limited matters such as market rates of return on the types of investment in issue in the present appeals.
[20] Counsel for the Appellants took exception to such a suggestion. According to him, if the calculation of an internal rate of return by Mr. Taylor were admissible, his opinion as to what would constitute a reasonable rate of return in the circumstances would be inadmissible because it would flow from the inadmissible materials reviewed by him from which he made findings of fact that he cannot "disabuse himself" of.
[21] Counsel for the Appellants stated that there would be extreme prejudice in proceeding in that fashion as he would not know at this point in the trial—which has already lasted nine days—what opinion Mr. Taylor would be asked to give.
[22] Counsel also pointed to the fact that he "might very well have run this trial on a fundamentally different basis" had he thought that the expert would be asked his opinion on a much narrower issue. In reliance on the report he received, counsel for the Appellants proceeded on the basis that the expert evidence was totally inadmissible given its content and conclusions and not that it called for a rebuttal opinion, which he might have sought if Mr. Taylor's report had been confined to a simple opinion on the calculation of internal rates of return or of market rates of return on certain types of investment.
Analysis
[23] In Mohan, supra, the Supreme Court of Canada enumerated the applicable criteria for determining the admissibility of opinion evidence. To those criteria the Court added "a cost benefit analysis, that is 'whether its value is worth what it costs'" (p. 21).
[24] The Court explained the effect of such an inquiry on the relevance analysis as follows, at p. 21:
Evidence that is otherwise logically relevant may be excluded on this basis, if its probative value is overborne by its prejudicial effect, if it involves an inordinate amount of time which is not commensurate with its value or if it is misleading in the sense that its effect on the trier of fact, particularly a jury, is out of proportion to its reliability. While frequently considered as an aspect of legal relevance, the exclusion of logically relevant evidence on these grounds is more properly regarded as a general exclusionary rule (see Morris v. The Queen, [1983] 2 S.C.R. 190). Whether it is treated as an aspect of relevance or an exclusionary rule, the effect is the same. The reliability versus effect factor has special significance in assessing the admissibility of expert evidence.
[25] The Court also explained how the same inquiry affects the necessity analysis. The Court described the necessity criterion as follows at p. 23:
What is required is that the opinion be necessary in the sense that it provide information "which is likely to be outside the experience and knowledge of a judge or jury": as quoted by Dickson J. in R. v. Abbey, supra. As stated by Dickson J., the evidence must be necessary to enable the trier of fact to appreciate the matters in issue due to their technical nature. In Kelliher (Village of) v. Smith, [1931] S.C.R. 672, at p. 684, this Court, quoting from Beven on Negligence (4th ed. 1928), at p. 141, stated that in order for expert evidence to be admissible, "[t]he subject-matter of the inquiry must be such that ordinary people are unlikely to form a correct judgment about it, if unassisted by persons with special knowledge".
[26] As to the effect of the cost-benefit analysis, the Court stated, at pp. 24-25:
As in the case of relevance, discussed above, the need for the evidence is assessed in light of its potential to distort the fact-finding process. As stated by Lawton L.J. in R. v. Turner, [1975] Q.B. 834, at p. 841, and approved by Lord Wilberforce in Director of Public Prosecutions v. Jordan, [1977] A.C. 699, at p. 718:
"An expert's opinion is admissible to furnish the court with scientific information which is likely to be outside the experience and knowledge of a judge or jury. If on the proven facts a judge or jury can form their own conclusions without help, then the opinion of an expert is unnecessary. In such a case if it is given dressed up in scientific jargon it may make judgment more difficult. The fact that an expert witness has impressive scientific qualifications does not by that fact alone make his opinion on matters of human nature and behaviour within the limits of normality any more helpful than that of the jurors themselves; but there is a danger that they may think it does."
The possibility that evidence will overwhelm the jury and distract them from their task can often be offset by proper instructions.
There is also a concern inherent in the application of this criterion that experts not be permitted to usurp the functions of the trier of fact. Too liberal an approach could result in a trial's becoming nothing more than a contest of experts with the trier of fact acting as referee in deciding which expert to accept.
These concerns were the basis of the rule which excluded expert evidence in respect of the ultimate issue. Although the rule is no longer of general application, the concerns underlying it remain. In light of these concerns, the criteria of relevance and necessity are applied strictly, on occasion, to exclude expert evidence as to an ultimate issue. Expert evidence as to credibility or oath-helping has been excluded on this basis. See R. v. Marquard, [1993] 4 S.C.R. 223, per McLachlin J.
[Emphasis added.]
[27] These principles were also applied in several cases submitted by counsel for the Appellants. The following statement by Meredith J. of the Supreme Court of British Columbia in Johnson v. Goldsmid, supra, is particularly relevant:
In the first place, Dr. Andrews was left to draw his own factual conclusions from evidence he was given - much of which was not even available to the Court. For instance, he was given to read the complete discoveries, he listened to the unsworn observations of Mr. Stokie, and he took a view of the hill, guided by defence counsel. This may ease the burden for defence counsel considerably and it certainly would ease the burden on the Court in that the "expert" is left to decide the case. But it violates the basic rationale for the admission of opinion evidence of this sort.
First it is usually not for the expert to decide the facts upon which his opinion is based. But if he does decide certain facts, they must at least be stated. Let me emphasize: the opinion must be based on stated facts or hypotheses to be proven by evidence. In the present case the facts were not stated. And certainly the expert could not find facts in any event on hearsay, unsworn and untested. It will usually be for counsel to prove the facts in Court upon which the opinion is based.
The decisions in Yewdale v. Insurance Corp. of British Columbia and Surrey Credit Union v. Willson, supra, also contain similar reasoning.
[28] The above-cited authorities clearly state that when an expert witness's opinion relies upon hypothetical facts or assumptions of fact he has a duty to communicate those hypothetical facts or assumptions and he cannot make findings of fact himself. It is worth mentioning that the requirement that the hypothetical fact situation put to the expert witness be clear is also stated by Sopinka, Lederman and Bryant (1992), supra, in a paragraph that counsel for the Respondent relied on himself.
[29] None of the authorities referred to by the Respondent's counsel refute this general principle. Although I recognize that the nature of the source upon which an expert opinion is based cannot affect the admissibility of the opinion itself, as stated by the Supreme Court of Canada in the Saint John case, I am of the opinion that that source, regardless of its nature, has to be clearly stated. Similarly, I agree with the Respondent's counsel that deficiencies in the expert opinion that may result from reliance on inaccurate assumptions are only relevant in assessing the weight of the opinion, as the Supreme Court of Canada stated in the Warsing case, supra. However, I am also of the opinion that the unknown character of the assumptions relied on is relevant to the determination of the admissibility of the expert opinion. In my view, the fact that the opinion is based on the expert's own findings of fact (as appears to be the case with Mr. Taylor's report), which are unknown to the Court, is an issue that relates to its admissibility. It seems obvious to me that the admission of the expert evidence in the present case would, as a result of the extreme difficulty in determining what assumptions were actually relied on and how accurate they were as well as which ones were not considered, leave the Court wondering when assessing the weight to be attached to that evidence. In no way can this meet the test of clear and unambiguous hypothetical facts.
[30] Moreover, I think that the Marquard case, supra, relied on by the Respondent's counsel, is a further argument for refusal of the evidence in question. In that case, the issue was whether the expert witnesses, as practising physicians, possessed some special knowledge related to the burns and child abuse with respect to which they testified and which were alleged to lie outside their field of expertise. The Supreme Court of Canada found that while they were not medical specialists in burns, there could be no doubt that "as practising physicians they possessed an expertise on burns which is not possessed by the ordinary untrained person." It is in this context that the Court stated that "[t]he only requirement for the admission of expert opinion is that the 'expert witness possesses special knowledge and experience going beyond that of the trier of fact'". As stated by the Appellants' counsel, the evidence at issue contains several conclusions of fact and law in respect of which Mr. Taylor does not possess any special knowledge and experience going beyond that of the trier of fact. Mr. Taylor readily admitted as much when questioned by the Appellants' counsel with respect to no less than 30 such conclusions.
[31] Applying the foregoing to the expert report as presented before the Court, I agree with the Appellants' counsel that Mr. Taylor, by founding his analysis on assumptions he made based on his review of various transcripts—which moreover were not necessarily part of the evidence before the Court—"has heard a different trial, a trial of his own making, a trial that was put to him . . . ." There is no doubt that Mr. Taylor was initially sent on a fact-finding mission in the transcripts of evidence in the OSFC trial and also in discoveries that were perhaps not all adduced as evidence. I do not agree with counsel for the Respondent that they were facts that he was asked to assume and, as such, hypothetical fact situations as required by the case law. Moreover, it is trite to say that identical sets of facts can be entered into evidence in a court of law in many different ways and can produce results that differ widely. This depends on numerous factors, not the least of which being the ability of counsel in examination and cross-examination to elicit the pertinent facts of a case. Hence, we can readily see the compelling necessity of giving the expert clear, unambiguous and uncontradicted hypothetical facts on which to give his opinion, unless it can be based on facts proven in the case at bar.
[32] Moreover, in my opinion, in admitting Mr. Taylor's report and testimony, which are based on numerous conclusions of fact stemming from his reliance on evidence relating to another trial, there would be a danger that the Court might be led to use that evidence, at least in part, to decide the present appeals. In that respect, one can but recall the words of the Federal Court of Appeal in Attorney General of Canada v. Pompa, 94 DTC 6630; [1995] 1 C.T.C. 466, at p. 469:
If there is one well-settled rule of law it is that a judge cannot take cognizance of facts coming directly to his attention in the course of another proceeding to decide on the fate of a proceeding in which those facts were not entered in evidence. A judge simply does not have any ex officio knowledge of what he learned in another case (see Sopinka, Lederman & Bryant, The Law of Evidence in Canada, Butterworths, Toronto, 1992, page 985) and he is failing greatly in his duty of neutrality if he makes use of such knowledge (see Ducharme, Précis de la preuve, 3d ed., Wilson and Lafleur, Montréal, 1986, page 17). As Professor Ducharme observes, "the judge's neutrality is the best guarantee of his impartiality".
[33] The foregoing analysis would in my view be sufficient to refuse to admit the evidence at issue. However, I would add that I agree with counsel for the Appellants that Mr. Taylor's conclusion that "a profit-oriented business person acting reasonably would not enter into the transactions, as described herein, in the absence of or excluding income tax considerations"[3] relates to how a reasonable person would behave and would seem to be contrary to the Adam case, supra. In that case, the Supreme Court of Canada, at p. 458, referred to Phipson on Evidence, 8th ed., p. 385, in stating the following:
[n]either experts nor ordinary witnesses may give their opinions upon matters of legal or moral obligation, or general human nature, or the manner in which other persons would probably act or be influenced.
[34] In sum, I find that the whole process from beginning to end "violates the basic rationale for the admission of opinion evidence" (see Johnson v. Goldsmid, supra).
[35] With respect to counsel for the Respondent's alternative argument to the effect that Mr. Taylor should be permitted to testify on limited matters within his area of expertise, I agree with the submissions of counsel for the Appellants. To accept Mr. Taylor's testimony on limited matters confined to market rates of return or proper calculation of rates of return would be to engage in a completely different exercise than the one Mr. Taylor undertook and which was from the outset an unauthorized fact-finding mission. First of all, such acceptance would imply, as counsel for the Appellants said, that Mr. Taylor could "disabuse himself" of the clearly inadmissible evidence contained in his report. This would appear to be more easily said than done and the result would probably be more theoretical than practical. Secondly, notice was given pursuant to section 145 of the Tax Court of Canada Rules (General Procedure) that the evidence Mr. Taylor was going to give was that contained in his report. Based on his evaluation of the type of evidence contained in the report, counsel for the Appellants proceeded to trial on the assumption that the report could not be admitted in evidence and that a rebuttal opinion was not necessary in the circumstances. After nine days of trial we are at a point where counsel for the Respondent is asking the Court to at least accept Mr. Taylor's testimony on limited matters within his area of expertise. In my opinion, procedural fairness embodied in section 145 of the Rules requires that the report filed and served represent the evidence that the expert is prepared to give in the matter. The 30 days' notice ensures that the other party can prepare his case accordingly.
[36] Because neither the exact opinion Mr. Taylor would be asked to give on limited matters nor the hypothetical facts which he would have to assume are precisely known at this point[4] and because counsel for the Appellants could not and cannot receive advance notice thereof so as to be able to obtain a rebuttal opinion if necessary, I am convinced that the prejudice that would be suffered outweighs the necessity of Mr. Taylor's evidence.
[37] This by no means implies that expert evidence would not have been more than useful in the present case had things been done differently from the outset. However, considering the cost-benefit analysis referred to in the Mohan case, supra, I am of the opinion that the criterion of necessity should be applied strictly and that Mr. Taylor's expert evidence should be excluded in its entirety.
[38] Consequently, Mr. Richard Charles Taylor's expert report filed with the Court and served on the Appellants by the Respondent will not be admitted in evidence. Mr. Taylor will not be permitted to give testimony on limited technical matters confined to his area of expertise. The copies of Mr. Taylor's report in the Court's possession will thus be sealed and the envelope containing the same will be marked as Exhibit I on "voir dire" in the present appeals.
Signed at Ottawa, Canada, this 30th day of July 2001.
"P.R. Dussault"
J.T.C.C.
COURT FILE NOS.: 1999-464(IT)G, 1999-466(IT)G, 1999-467(IT)G, 1999-468(IT)G, 1999-469(IT)G, 1999-472(IT)G, 1999-473(IT)G, 1999-474(IT)G, 1999-475(IT)G, 1999-476(IT)G, 1999-478(IT)G, 1999-479(IT)G, 1999-480(IT)G, 1999-481(IT)G, 1999-484(IT)G, 1999-486(IT)G, 1999-487(IT)G, 1999-488(IT)G.
STYLE OF CAUSE: DOUGLAS H. MATHEW, STEVEN M. COOK, EUGENE KAULIUS, CHARLES E. BEIL,
347059 B.C. Ltd., JOHN R. OWEN,
AMALIO DE COTIIS, WILLIAM JOHN MILLAR,
NSFC HOLDINGS LTD.,
WARREN J. A. MITCHELL,
TFTI HOLDINGS LIMITED, IAN H. PITFIELD,
THE ESTATE OF THE LATE LORNE A. GREEN,
INNOCENZO DE COTIIS,
VERLAAN INVESTMENTS INC., FRANK MAYER, CRAIG C. STURROCK, JOHN N. GREGORY,
and Her Majesty The Queen
PLACES OF HEARING: Vancouver, British Columbia
Ottawa, Canada
DATES OF HEARING: July 3 - 13, 2001 (Vancouver)
July 18, 2001 (Ottawa)
REASONS FOR ORDER BY: The Honourable P.R. Dussault
DATE OF ORDER: July 19, 2001
DATE OF REASONS FOR ORDER: July 30, 2001
APPEARANCES:
Counsel for the Appellants: Kim Hansen
David Martin
Counsel for the Respondent: Luther P. Chambers
Robert Carvalho
COUNSEL OF RECORD:
For the Appellants:
Name: Kim Hansen
David Martin
Firm: THORSTEINSSONS
Vancouver, British Columbia
For the Respondent: Morris Rosenberg
Deputy Attorney General of Canada
Ottawa, Canada
[1] This is a reference to the case of OSFC Holdings Ltd. v. The Queen. The decision of the Tax Court of Canada in that case is reported at 99 DTC 1044, [1999] 3 C.T.C. 2649 and has been appealed to the Federal Court of Appeal.
[2] SOR/90-688, as amended.
[3] Page 2 of Mr. Taylor's report.
[4] This is a reference to the day the order was made verbally during a conference call on June 18, 2001, at 4 p.m. That order was signed in Ottawa on June 19, 2001. Two hours before the conference call was scheduled to take place, counsel for the Respondent sent by fax new submissions in support of having Mr. Taylor testify on four specific matters. At the beginning of the conference call, I indicated to counsel for the Respondent that these new submissions had not been communicated to me. Counsel for the Appellants stated that he had not received them either. As a matter of fact, these new submissions were communicated to me on my arrival at the Court at around 8:15 a.m. on June 19, 2001. Again, on the basis that fair notice had not been given to counsel for the Appellants and also because the submissions in question were presented in an unacceptable fashion, I decided to maintain the order and I signed it the same day.