Tax Court of Canada Judgments

Date: 20010907

Docket: 1999-4703-IT-I

BETWEEN:

SOLANGE GILBERT,

Appellant,

and

HER MAJESTY THE QUEEN,

Respondent.

Reasons for Judgment

P. R. Dussault, J.T.C.C.

[1]      The Notice of Appeal filed by the appellant has to do with assessments for the 1995, 1996, 1997 and 1998 taxation years. In those assessments, the Minister of National Revenue (''the Minister'') did not allow the appellant the credit for mental or physical impairment for the 1995, 1996 and 1997 taxation years as she had not initially claimed a credit for those years. The credit claimed by the appellant in her 1998 income tax return was disallowed. In June 1997, a reassessment for the 1995 taxation year adjusted a net capital loss from a subsequent taxation year.

[2]      A prescribed form T2201 concerning the credit for mental or physical impairment, signed by Dr. Denis Phaneuf and dated October 6, 1998, was filed with the Minister. As well, a questionnaire dated November 9, 1998 was sent to Dr. Phaneuf, who completed it on November 22, 1998 and returned it to the Minister. In his responses to the questionnaire, Dr. Phaneuf indicated in particular that the appellant had chronic fatigue syndrome.

[3]      However, the appellant served her notices of objection for the 1995, 1996 and 1997 taxation years on the Minister only on March 29, 1999. On April 26, 1999, the Minister notified the appellant that she had filed the notice of objection to the assessment for the 1995 taxation year after the deadline for filing, and indeed after the deadline for applying for an extension of that deadline. He also notified her that she had filed the notice of objection for the 1996 taxation year after the deadline, but could apply for an extension of time. The appellant did so and the application was allowed on June 8, 1999.

[4]      On June 14, 1999, the Minister made the assessment disallowing the credit for mental or physical impairment claimed by the appellant for the 1998 taxation year; on July 5, 1999, the appellant objected to that assessment.

[5]      The appeals from the assessments for the 1996 and 1997 taxation years were instituted within the time prescribed in paragraph 169(1)(a) of the Income Tax Act (''the Act'') and the appeal from the assessment for the 1998 taxation year was instituted within the time prescribed in paragraph 169(1)(b) of the Act, the Minister having at that time not yet confirmed the assessment following the appellant's objection.

[6]      The Minister disallowed the credit for mental or physical impairment claimed by the appellant for the years at issue on the basis that, during those years, the appellant did not have a severe and prolonged mental or physical impairment whoseeffects were such that her ability to perform a basic activity of daily living was markedly restricted within the meaning of sections 118.3 and 118.4 of the Act.

[7]      The above-mentioned facts are set out in paragraph 4 of the Reply to the Notice of Appeal and have been admitted by counsel for the appellant.

[8]      The appeal from the assessment for the 1995 taxation year must be dismissed on the ground of nullity, because it was not preceded by a notice of objection filed within the time prescribed in paragraph 165(1)(b) of the Act.

[9]      I assume that the prescribed form T2201 was filed in support of the appellant's claim for the 1996, 1997 and 1998 taxation years so as to meet the condition set out in paragraph 118.3(1)(b) of the Act, which requires that the requisite medical certificate be filed with the Minister.

Summary of the evidence

[10]     Only the appellant testified. She explained that her illness was diagnosed in 1995. She worked until 1992 and began suffering from symptoms of the illness in 1993. They were identified at the time as symptoms of depression. At that point she was obliged to stop working for one year. In 1994, she returned to work, but for only three months. She stopped working again in January 1995. She testified that, at that time, she was unable to get up and remained in bed all day with excruciating headaches and fibromyalgia pain. This was when chronic fatigue syndrome was identified. The appellant explained that, aside from her frequent appointments with medical doctors, she was in bed most of the time, unable to [TRANSLATION] ''take two steps around the house''. According to the appellant, this condition lasted for three years before she began recuperating and to be able to walk [TRANSLATION] ''slowly''. With the help of a document about chronic fatigue syndrome, the appellant listed her symptoms as being the following: headaches, visual problems, pressure behind the eyeball, hypersensitivity to heat and cold, below-normal body temperature, swollen ganglions, digestive problems, food sensitivity and intolerance, muscle problems and chronic pains, cramps, difficulty remaining standing, chest pains, cardiac problems, palpitations, trouble sleeping, and mood disturbance. She noted that there was a period during which she experienced less severe symptoms, although she was unable to pinpoint when that was. She explained, however, that her symptoms became much worse following a hysterectomy in October 2000.

[11]     The appellant testified as well that in 1994 she required shoulder surgery, from which she had a great deal of trouble recuperating because of her illness, which, she explained, affects the immune system. She also noted that in 1996 she had the same operation on the other shoulder, again recuperating only after convalescing for several months (from three to six months, she said) whereas, normally, a patient should not take more than a week to recover from this type of operation.

[12]     The appellant testified that she also suffered from confusion, a condition I was able to observe, since she lost her train of thought several times while testifying at the hearing.

[13]     In describing a typical day, the appellant said that she would endeavour to [TRANSLATION] ''do [her] little jobs'' after breakfast, although she was already not feeling well. She would suffer, however, from sudden declines in energy that forced her to go back to bed for approximately half an hour or an hour. She would get up again around 11:15 a.m. and begin preparing her lunch. She explained that she would then have to eat very quickly, again because of sudden declines in energy. The same situation would be repeated during the afternoon. The appellant explained that she had given up reading because of problems with concentration: she was unable to recall what she had only just read.

[14]     The appellant stated that she lived alone, receiving assistance from the CLSC (local community social service centre) and in particular the help of an occupational therapist.

[15]     The appellant described walking as [TRANSLATION] ''difficult'' without specifying, however, how long it took her to walk a given distance.

[16]     The appellant explained that feeding herself was a real problem for her, indicating that when she was very hungry she could not prepare anything because the fatigue made her shake. She also noted that as a result of her illness she suffered from various food allergies, which made feeding herself even more complicated. She explained that she was extremely tired after eating, but that when she sat down to rest she could not sleep. She added that she had trouble sleeping and managed to sleep for only one or two hours a night. On this point, she said that the medications prescribed by her doctor for this condition had stopped working after a while.

[17]     The appellant also stated that her recreational activities and social abilities were greatly restricted by her illness. She said that occasionally she would go for a drive, that she would park after a time and then walk to a nearby bench in order to get some fresh air or else sit in the car and listen to the radio. She explained that she avoided meeting people because she was embarrassed about her condition. Noting that she was unable to remain standing for prolonged periods, she stated that, when she met persons she knew outdoors, she pretended not to see or not to recognize them, fearing that her fatigue and inability to remain standing would make her appear ridiculous. Her main outings consisted of frequent visits to various medical specialists, including two visits a year to Dr. Phaneuf in Montréal.

[18]     In addition to testifying, the appellant produced as evidence a number of documents, including the above-mentioned form T2201 completed by Dr. Phaneuf. In response to the question concerning the ability to walk: ''Is your patient able to walk, using an aid if necessary? (For example, at least 50 metres on level ground.)", Dr. Phaneuf checked ''No'' and added the following annotation: [TRANSLATION] ''Walks less than 50 metres on account of fatigue.'' In response to the question concerning mental functions: ''Is your patient able to think, perceive, and remember, using medication or therapy if necessary? (For example, can he or she manage personal affairs or do personal care without supervision?)'', Dr. Phaneuf also checked ''No'' and added the following annotation: [TRANSLATION] ''Problems with short-term memory + + +''.

Relevant statutory provisions

[19]     In 1996 and 1997, paragraphs 118.3(1) and 118.4(1) read as follows:

118.3 (1) Credit for mental or physical impairment -

Where

      (a) an individual has a severe and prolonged mental or physical impairment,

(a.1) the effects of the impairment are such that the individual's ability to perform a basic activity of daily living is markedly restricted,

(a.2)a medical doctor, or where the impairment is an impairment of sight, a medical doctor or an optometrist, has certified in prescribed form that the individual has a severe and prolonged mental or physical impairment the effects of which are such that the individual's ability to perform a basic activity of daily living is markedly restricted,

(b) the individual has filed for a taxation year with the Minister the certificate described in paragraph (a.2), and

(c)    no amount in respect of remuneration for an attendant or care in a nursing home, in respect of the individual, is included in calculating a deduction under section 118.2 (otherwise than because of paragraph 118.2(2)(b.1)) for the year by the individual or by any other person,

for the purposes of computing the tax payable under this Part by the individual for the year, there may be deducted an amount determined by the formula

A x $4,118

          where

            A is the appropriate percentage for the year.

118.4 (1) Nature of impairment - For the purposes of subsection 6(16), sections 118.2 and 118.3 and this subsection:

(a) an impairment is prolonged where it has lasted, or can reasonably be expected to last, for a continuous period of at least 12 months;

(b)    an individual's ability to perform a basic activity of daily living is markedly restricted only where all or substantially all of the time, even with therapy and the use of appropriate devices and medication, the individual is blind or is unable (or requires an inordinate amount of time) to perform a basic activity of daily living;

(c) a basic activity of daily living in relation to an individual means

                                       (i)      perceiving, thinking and remembering,

                                       (ii)     feeding and dressing oneself,

(iii)    speaking so as to be understood, in a quiet setting, by another person familiar with the individual,

(iv)    hearing so as to understand, in a quiet setting, another person familiar with the individual,

            (v)     eliminating (bowel or bladder functions), or

                                       (vi)     walking; and

(d)     for greater certainty, no other activity, including working, housekeeping or a social or recreational activity, shall be considered as a basic activity of daily living.

Paragraph 118.3(1)(a.2) was amended by S.C. 1998, chapter 19, subsection 24(1), applicable to certifications made after February 18, 1997, to read as follows:

(a.2) in the case of

         (i)    a sight impairment, a medical doctor or

                 an optometrist,

(ii)    a hearing impairment, a medical doctor or an audiologist, and

(iii)    an impairment not referred to in subparagraph (i) or (ii), a medical doctor

has certified in prescribed form that the impairment is a severe and prolonged mental or physical impairment the effects of which are such that the individual's ability to perform a basic activity of daily living is markedly restricted.

Subparagraph 118.3(1)(a.2)(iii) was amended and subparagraphs (iv) and (v) were added by S.C. 1999, chapter 22, subsection 35(1), applicable to certifications made after February 24, 1998. Those subparagraphs read as follows:

(iii) an impairment with respect to an individual's ability in feeding and dressing themself, or in walking, a medical doctor or an occupational therapist,

(iv)    an impairment with respect to an individual's ability in perceiving, thinking and remembering, a medical doctor or a psychologist, and

(v) an impairment not referred to in any of subparagraphs (i) to (iv), a medical doctor.

Positions of the parties

[20]     The position of counsel for the appellant-namely that the appellant had a severe and prolonged mental or physical impairment-is based in particular on the comments made by Judge Bowman of this Court in Radage v. Canada, [1996] T.C.J. No. 730 (QL), which were echoed by Létourneau J. A. of the Federal Court of Appeal in Johnston v. Canada, [1998] F.C.J. No. 169 (QL). Counsel for the appellant referred to those decisions in support of his arguments in a similar case heard on the same day as the present appeals. Essentially, the two decisions establish the principle that the legislative provisions dealing with the credit for mental or physical impairment must be interpreted compassionately, and not given a narrow interpretation.

[21]     Then, briefly emphasizing that the appellant's condition had not appreciably improved since the onset of her illness in 1993, counsel for the appellant pointed out that her impairment was without a doubt prolonged, as the Act requires. Concerning the restriction of the appellant's ability to perform basic activities of daily living, counsel emphasized the impairments affecting her walking and her mental functions.

[22]     The arguments put forward by counsel for the respondent were based mainly on the appellant's testimony. Counsel acknowledged that the medical certificate completed by Dr. Phaneuf on the prescribed form T2201 indicated that the appellant required an inordinate amount of time for walking and for exercising the mental functions of perceiving, thinking, and remembering. However, in the opinion of counsel for the respondent, the appellant's testimony contradicted that medical conclusion.

[23]     Concerning walking, counsel for the respondent emphasized that the appellant could drive a car in town and go to a park. He noted that she was able to go shopping and even to travel very long distances, in particular to visit her medical specialist in Montréal twice a year. In counsel's opinion, these facts indicate that the appellant was able to walk for a distance of over 50 metres, in contrast to what was indicated on the form completed by Dr. Phaneuf.

[24]     With respect to thinking and remembering, counsel for the respondent emphasized that the appellant was able to distinguish between various articles of medical literature in her possession, was familiar with a number of medical terms, and was able to situate certain facts chronologically with a rather good degree of accuracy. In particular, counsel referred to the surgical operations spoken of by the appellant, which were performed over five years previously.

[25]     Counsel for the respondent relied on several decisions he cited in argument in another taxpayer's appeals, heard on the same day as the present appeals. Those decisions are Sarkar v. Canada, [1995] T.C.J. No. 669 (QL), Campbell v. Canada, [1996] T.C.J. No. 513 (QL), and Radage (supra).

[26]     Counsel for the respondent quoted the following passage from paragraph 22 of Judge Sarchuk's reasons in Sarkar (supra):

. . . However it is obvious that Parliament, as a matter of policy, intended to create a high threshold regarding the level of disability which must be met in order to qualify. That is the only way to read that section, particularly in view of the fact that it was not worded as strictly before and the legislators amended it to make it stricter. I cannot read it in any other fashion.

[27]     Counsel for the respondent referred as well to the following excerpts from paragraphs 19 and 21 of Judge Rowe's reasons in Campbell (supra):

. . . I find on the evidence that during 1992 and 1993, the appellant had more bad days than good days but she was able to drive her car to the location of her medical professionals and to walk to their office during her visits which, during certain periods, could be as frequent as two or three times per week. . . .

. . . There is no doubt the legislation is designed to bar the claim for all but the most severely handicapped. The problem is exacerbated by the unevenness of assessments from year to year and from person to person suffering from the same disability. It makes it more difficult to understand when many of these persons gather together in support groups and discuss the acceptance or rejection of their claims. These are matters which are within the ability of the Minister to address and are not capable of being remedied by this Court. It is also not the function of the Court to validate, as deserving of increased recognition, a particular disease or condition that may be poorly understood by the majority of medical practitioners.

[28]     Lastly, counsel for the respondent referred to the following passage from paragraph 45 of Judge Bowman's reasons in Radage (supra):

. . . In these guidelines I have emphasized the need to recognize the way in which one function depends on the others, and to attempt to relate the use of those functions to some meaningful result in everyday life.

(e)         Finally there must be considered -- and this is the most difficult principle to formulate -- the criteria to be employed in forming the judgement whether the mental impairment is of such severity that the person is entitled to the credit, i.e. that that person's ability to perceive, think and remember is markedly restricted within the meaning of the Act. It does not necessarily involve a state of complete automatism or anoesis, but is should be of such a severity that it affects and permeates his or her life to a degree that it renders that person incapable of performing such mental tasks as will enable him or her to function independently and with reasonable competence in everyday life.

Analysis

[29]     In Radage (supra), Judge Bowman sets out certain general principles concerning the application of sections 118.3 and 118.4 of the Act. In particular, he states the following in paragraph 45 of his reasons:

. . .

(b)    The court must, while recognizing the narrowness of the tests enumerated in sections 118.3 and 118.4, construe the provisions liberally, humanely and compassionately and not narrowly and technically. . . .

[30]     These comments were moreover echoed by Létourneau J.A. of the Federal Court of Appeal in Johnston (supra). Létourneau J.A. wrote as follows in paragraph 11:

Indeed, although the scope of these provisions is limited in their application to severely impaired persons, they must not be interpreted so restrictively as to negate or compromise the legislative intent.

[31]     In addition to the decisions cited by the parties, there has been a number of rulings by this Court on the application of sections 118.3 and 118.4 of the Act in cases involving persons with chronic fatigue syndrome.[1]

[32]     It goes without saying, however, that while certain decisions may enlighten the Court, each case stands on its own merits and must be decided on its own facts according to the burden of proof and degree of proof required. In this regard, it should be pointed out that the onus was on the appellant to prove on a balance of probabilities the facts demonstrating that, based on the conditions set out in the relevant provisions of the Act, she was entitled to the credit she claimed. The exercise of comparing the facts in another case, which may present certain similarities, therefore cannot replace the application of the statutory provisions, and of the requirements stated therein, to the circumstances proven in a given case.

[33]     As a condition of eligibility for the credit for mental or physical impairment, paragraph 118.3(1)(a.2) requires in particular a certification in the prescribed form, by a medical doctor (or, depending on the impairment, by another of the persons mentioned), ''that the impairment is a severe and prolonged mental or physical impairment the effects of which are such that the individual's ability to perform a basic activity of daily living is markedly restricted''. As well, paragraph 118.3(1)(b) requires the individual claiming the credit to file with the Minister, for a taxation year, the certificate described in paragraph 118.3(1)(a.2).

[34]     The prescribed form, as we know, is form T2201. Not only must that form obligatorily be completed by one of the persons referred to in paragraph 118.3(1)(a.2), it must also certify that there is a severe and prolonged mental or physical impairment the effects of which are those indicated, based on the various definitions set out in section 118.4 of the Act. The certificate in the prescribed form must then be filed with the Minister. The certificate requirement is not merely directory; it is mandatory. In MacIsaac v. Canada; Morrison v. Canada, [1999] F.C.J. No. 1898 (QL), the Federal Court of Appeal emphasized in the following terms, in paragraphs 3 to 6 of its reasons for judgment, the mandatory nature of this requirement laid down in paragraph 118.3(1)(a.2):

[para 3] Revenue Canada issued T-2201 Forms to be completed by doctors who have examined applicants for disability tax credits. Those forms were filled out in both cases but it is unclear to us as to whether they are in compliance with the above sections.

[para 4] The Tax Court Judge allowed both appeals on the basis that in his judgment both Respondents met the criteria established by Section 118.4(1). In considering the forms at issue in this appeal he said in the Morrison case:

''I have therefore concluded that the requirement in paragraph 118.3(1)(a.2) is directory only, and not mandatory.''

[para 5] While we sympathize with both Respondents and with the position taken by the Tax Court Judge we cannot agree with him on this question. Section 118.3(1)(a.2) of the Income Tax Act is not merely directory. It is mandatory. Simply put, there must be a certificate by the doctor that the individual suffers impairments in the language of these subsections. This Court held to the same effect in Partanen v. Canada, [1999] F.C.J. 751 and we feel bound by this decision.

[para 6] It is not obvious that putting the questions as they are in this form results in a thorough consideration by the doctor of the questions confronting him. Putting checks in boxes is perhaps not the best way of eliciting a just result. Nevertheless the Act requires such certificates as a prerequisite to obtaining disability tax credits.

(Emphasis added.)

[35]     In the present case, Dr. Phaneuf, whom the appellant had been consulting for a number of years, completed the prescribed form T2201, certifying thereon that the appellant suffered impairments affecting her walking and her mental functions. As regards the latter, he indicated that she experienced in particular very severe short-term memory problems. As I have noted, this form was filed with the Minister for the years at issue. Therefore, the conditions set out in paragraphs 118.3(1)(a.2) and 118.3(1)(b) have been met. It is true that filing the prescribed form certifying in terms consistent with paragraph 118.3(1)(a.2) and subsection 118.4(1) that there is an impairment is not the only condition set out. Paragraphs 118.3(1)(a) and (a.1) require individuals to establish that they have a severe and prolonged mental or physical impairment, of which the effects are such that their ability to perform a basic activity of daily living is markedly restricted, in accordance with the criteria set out in subsection 118.4(1).

[36]     Counsel for the respondent, who did not cross-examine the appellant, considers that the appellant's testimony contradicts Dr. Phaneuf's conclusions. I disagree. Although the appellant admitted that she could walk for short distances, there is no indication that she can walk a distance of over 50 metres or that she does not require an inordinate amount of time for walking. Unlike counsel for the respondent, I am not convinced that the fact that the appellant is able to travel to Montréal by bus and taxi twice a year shows that she is able to walk a distance of over 50 metres without resting. Concerning the appellant's mental functions, the certificate completed by Dr. Phaneuf indicates very poor short-term memory, which the Court has been able to observe, since the appellant lost her train of thought several times while testifying at the hearing.

[37]     In my opinion, the appellant's testimony alone might not have sufficed to establish clearly that her ability to perform a basic activity of daily living was markedly restricted such that all or substantially all of the time she required an inordinate amount of time to perform it. Nevertheless, her testimony does not directly contradict Dr. Phaneuf's conclusions.

[38]     Given the requirements set out in paragraphs 118.3(1)(a) and (a.1) as well as those in paragraphs 118.3(1)(a.2) and (b) of the Act, it is clear that the Court is not bound by the certificate in the prescribed form. It is equally clear that an unequivocal certification of the existence of an impairment by an authorized person (a medical doctor or other professional) on the prescribed form cannot be dismissed without fully convincing evidence to the contrary.

[39]     Appellants claiming the credit for mental or physical impairment find themselves in a particularly delicate position in relation to the medical doctor or professional who has completed the prescribed form. The problems that persons with an impairment may encounter in asking a medical doctor who has completed that form to appear as a witness, or in compelling the doctor to testify by means of a subpoena, are well known. As was pointed out by Judge Bowman of this Court in paragraph 20 of his reasons for judgment in Morrison v. Canada, [2000] T.C.J. No. 302 (QL):

To expect disabled people to subpoena their doctor and pay him or her $300 as is required by subsection 12(2) of the informal procedure rules is unrealistic.

[40]     This expectation is all the more unrealistic when an appellant has applied to the Court for a waiver of the payment of the $100 filing fee prescribed in paragraph 18.15(3)(b) of the Tax Court of Canada Act and the Court has-as it has done in the present case through the November 18, 1999 order by Chief Judge Garon-allowed that application under subsection 18.15(3.4) because it is satisfied that payment of that fee would cause serious financial hardship to the individual.

[41]     In this context, if the Minister wishes to challenge the responses provided on the prescribed form by a medical doctor or other professional, it would be normal, it seems to me, for the Minister to subpoena that person to appear at the hearing of an appeal so as to genuinely enlighten the Court in a fairer and more equitable context.

[42]     In view of the foregoing, the appeal from the assessment for the 1995 taxation year is dismissed on the ground of nullity. The appeals from the assessments for the 1996, 1997 and 1998 taxation years are allowed and the assessments are referred back to the Minister for reconsideration and reassessment on the basis that for those years the appellant is entitled to the credit for mental or physical impairment under sections 118.3 and 118.4 of the Income Tax Act.

Signed at Ottawa, Canada, this 7th day of September 2001.

"P. R. Dussault"

J.T.C.C.

Translation certified true

on this 31st day of May 2002.

Erich Klein, Revisor

[OFFICIAL ENGLISH TRANSLATION]

1999-4703(IT)I

BETWEEN:

SOLANGE GILBERT,

Appellant,

and

HER MAJESTY THE QUEEN,

Respondent.

Appeals heard on June 15, 2001, at Québec, Quebec, by

the Honourable Judge P. R. Dussault

Appearances

Counsel for the Appellant:                    Gaétan Drolet

Counsel for the Respondent:                Vlad Zolia                       

JUDGMENT

The appeal from the assessment for the 1995 taxation year is dismissed on the ground of nullity. The appeals from the assessments for the 1996, 1997 and 1998 taxation years are allowed and the assessments are referred back to the Minister of National Revenue for reconsideration and reassessment on the basis that for those years the appellant is entitled to the credit for mental or physical impairment under sections 118.3 and 118.4 of the Income Tax Act.

The whole in accordance with the attached Reasons for Judgment.

Signed at Ottawa, Canada, this 7th day of September 2001.

"P. R. Dussault"

J.T.C.C.

Translation certified true

on this 31st day of May 2002.

Erich Klein, Revisor

[OFFICIAL ENGLISH TRANSLATION]