Murphy v. Canada (Minister of National Revenue)

Murphy v. Canada (Minister of National Revenue) Court (s) Database Federal Court of Appeal Decisions Date 2002-04-29 Neutral citation 2002 FCA 160 File numbers A-27-00 Notes Digest Decision Content Date: 20020429 Docket: A-27-00 Neutral Citation: 2002 FCA 160 BETWEEN: COLIN J. MURPHY, MARION MURPHY, RAYLYNN MURPHY, WILSON MURPHY, JR., MYRTLE MURPHY-SMITH AND RONALD SMITH Applicants - and - THE MINISTER OF NATIONAL REVENUE Respondent ASSESSMENT OF COSTS - REASONS FRANÇOIS PILON Assessment Officer [1] This application for judicial review was dismissed with costs on June 4, 2001. The party and party assessment of the respondent's costs took place on April 16, 2002 by tele-conference with Mr. John Sinnott, Q.C. acting on behalf of the applicants and Mr. John Bodurtha on behalf of the respondent. [2] Mr. Sinnott does not oppose the assessable services claimed under items 2, 14 and 25. However, he suggests 2 units would be reasonable for the assessment of costs under item 26. Mr. Bodurtha agrees to reduce the number of units from 3 to 2. [3] Mr. Sinnott does not object to the following disbursements which are all supported by invoices: - $384.07 for photocopying services; - $14.00 for the services of a Commissioner of Oaths and - $39.68 for priority post charges. [4] The amount of $541.00 to photocopy the respondent's affidavit and application record is not opposed, but left to the discretion of the assessment officer. There is no evidence to support this expense. In Diversified Products Corp. et al v. Tye-Sil Corp., 34 C.P.R. (3rd) 267 Mr. Justice Teitelbaum established that the costs of photocopies is an allowable disbursement only if it is essential to the conduct of the proceedings. That test has been met here, the respondent having complied with the requirements of Rules 307 and 310. However, there is no evidence nor indication of the actual cost incurred. An examination of the Court record reveals that approximately 2,500 copies were made to comply with the above-noted Rules. I will allow the discretionary amount of $300.00 which appears to be reasonable in the circumstances. In so doing I find support in the reasoning of Assessment Officer Parent at page 23 of her reasons for assessment of costs in Inverhuron & District Ratepayers Association v. Minister of the Environment et al [2001] F.C.J. no. 666. In the absence of proof of the actual costs of photocopying she allowed a lump sum well below the figure claimed. [5] Finally, the respondent claims the sum of $1,849.20 to obtain a copy of the transcript of cross-examination of F.G. Brown. This cost is supported by an invoice dated March 7, 2000. At the assessment it was established by counsel that this disbursement was not made for the above-noted purpose, but rather to obtain a copy of the full transcript of the oral evidence before the Tax Court. Mr. Sinnott opposes the payment of this expense for the following reasons: i) After appealing the decision of the Tax Court Judge, counsel for the applicants did not file a transcript and he did not requests one; ii) The respondent did not provide a copy of the transcript to the applicants; iii) The transcript was not filed with the Court. It was only for the respondent's own, personal use; 4) Costs of photocopying portions of the transcript are already included in the amount of $541.00; 5) He would have taken notes during the Tax Court hearing so as to avoid incurring additional expenses; 6) Only portions of the transcript were used in the Federal Court. The applicants should not pay for the full document and 7) Counsel maintains it is wrong in principle for the respondent to have included this item of disbursement in this bill of costs. [6] Mr. Bodurtha rejects the arguments of Mr. Sinnott. His position is summarized below: 1) Portions of the transcript form part of the Court's record; 2) The respondent is entitled to rely upon the full transcript of the proceedings before the Tax Court in defence of its position; 3) The issues before the Tax Court Judge were, to a large extent, based upon the credibility of the applicants. The full transcript was essential to review the decision appealed from; 4) The Crown must not be punished for obtaining documentation required and relevant to its case; 5) The provisions of Rule 310 (2) (d) requires a respondent to include parts of the transcript of oral testimony and 6) At the time the transcript was requested counsel could not have known which portion would be relied upon at the hearing. [7] I agree with both parties that this issue raises important principles. Rule 310 (2) of the Federal Court Rules provides that: "The record of a respondent shall contain... d) the portions of any transcript of oral evidence before a tribunal that are to be used by the respondent at the hearing". [8] Mr. Sinnott and Mr. Bodurtha presented excellent arguments in support of their respective positions. I find the principles set forth by the respondent of greater importance than the ones held by his opponent. In my view Mr. Bodurtha was justified and entitled to obtain a copy of the transcript of the Tax Court proceedings to prepare an adequate defence of his case. The provisions of the Rules specifically require a respondent to include parts of a transcript which he/she intends to rely upon. And as Mr. Bodurtha pointed out the full transcript was necessary because he could not have been reasonably expected to know which part was essential to his case. Three decisions of the Court were helpful in deciding this point. In Hanson v. Canada (M.N.R.) [1987] F.C.J. No. 729 Mr. Justice Muldoon wrote at page 1 of his Reasons for Order: "The taxpayers of Canada do not unconditionally owe the plaintiff the cost of a transcript of proceedings in the Tax Court of Canada.... By whatever lawful means, however, the plaintiff is obliged to bear the disbursements of the action which he has instituted. A transcript is available to all, and is not a document in the sole possession of the defendant. Therefore, if the plaintiff wants a transcript, he must pay for it. If the plaintiff be ultimately awarded his costs of this action, and if the Court or a taxing officer consider that the transcript was necessary and relevant to the prosecution of the plaintiff's action, then the cost of the transcript can be included as a disbursement in any such costs as may be awarded to the plaintiff. But first the plaintiff must decide whether such a transcript be relevant and necessary, and if so, pay for it at this stage of the proceedings." [9] Taxing costs in a judicial review application in Swanson Estate v. Canada [1990] F.C.J. No. 357, Taxing Officer Stinson was faced with a similar situation to the case at bar. At page 4 he concludes: "I am reluctant to apply, as a standard, my assessment of whether plaintiffs' solicitor could have functioned without the transcript because this would involve hindsight to some extent as opposed to the considerably more relevant test of the reasonableness of the decision to incur the disbursement given the circumstances at the time. Here, plaintiffs' solicitor could not ignore the potential relevance of this evidence to case preparation and I approve the cost." [10] The same approach was endorsed by Taxing Officer Smith in Robert Pocha v. The Queen [1998] F.C.J. No. 306 where at page 2 he states: "The defendant also claimed disbursements of $184.90 for transcripts and $12.94 for Goods and Services Taxes. Costs for a transcript were also opposed by the plaintiff on the ground that the action was discontinued before examinations for discovery were held and no transcripts had been created in the proceedings before this Court. Counsel for the defendant responded that the disbursement claimed and the related taxes were expenditures for a transcript of the proceedings before the Tax Court of Canada and that they were prudently here. Again, I must agree with the position taken by the defendant. It may well now appear that a transcript of the Tax Court proceedings was not needed. The defendant was nevertheless required to undertake prudent steps to defend against the plaintiff's action. In fact, a defence was filed on June 6, 1990. I find the disbursements and related taxes claimed to be reasonable and necessary in the circumstances." [11] The respondent's bill of costs will accordingly be assessed and allowed in the amounts of $1,320.00 for assessable services and $2,586.95 for disbursements. A certificate of assessment will issue in the amount of $3.906.95. Halifax, Nova Scotia April 29, 2002 François Pilon Assessment Officer FEDERAL COURT OF APPEAL NAMES OF COUNSEL AND SOLICITORS OF RECORD COURT FILE NO.: A-27-00 BETWEEN: COLIN J. MURPHY ET AL Applicants -and- THE MINISTER OF NATIONAL REVENUE Respondent ASSESSMENT BY TELEPHONE CONFERENCE ON APRIL 16, 2002 ASSESSMENT OF COSTS - REASONS BY: FRANÇOIS PILON DATED: APRIL 29, 2002 APPEARANCES BY: Mr. John Sinnott, Q.C. For the Applicants Mr. John Bodurtha For the Respondent SOLICITORS OF RECORD: Lewis Sinnott St. John's, Newfoundland & Labrador For the Applicants Morris Rosenberg Deputy Attorney General of Canada (Ottawa) For the Respondent