Canada (National Revenue) v. Blouin

Canada (National Revenue) v. Blouin

The Court found it had jurisdiction to consider whether the December 3, 2002 transfers were unenforceable against the seizing creditor but not to adjudicate broader claims of incapacity-based invalidity. On the evidence the opposing parties proved by a preponderance that the transferred funds were theirs and the seizing creditor established the debtor's insolvency and his fraudulent intent to prefer relatives, but the seizing creditor failed to prove that the recipients (the opposing parties) shared that fraudulent intent or had knowledge of the debtor's insolvency such that the presumptions of art.1632 C.C.Q. applied. Accordingly, the objections to the garnishment succeed and the...

Citation
2005 FC 1657
Parties
Seizing Creditor: Canada (National Revenue); Judgment Debtor: Roger Blouin; Garnishee / Opposing Party: Anne-Marie Blouin; Garnishee / Opposing Party: Rose-Hélène Blouin; Garnishee / Opposing Party: Madeleine Tardif-Blouin
Court
Federal Court
Jurisdiction
Canada
Judgment Date
5 December 2005
Procedural Posture
Income Tax Act Enforcement Garnishment Proceedings / Hearing on Confirmation of Provisional Garnishment and Objections Under Section 597 C.c.p.
Outcome
Objections allowed; garnishments avoided; each party to bear own costs.
Legal Topics
Garnishment, Unenforceability (action Paulienne), Fraudulent Preference, Capacity and Mandates, Minister's Certificate Deemed Judgment
Source Language
English
Tax Law Civil Procedure Insolvency Law Quebec Civil Code Civil Obligations Garnishment Unenforceability (action Paulienne) Fraudulent Preference Capacity and Mandates +1 more

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Parties

Canada (National Revenue)

Seizing Creditor

Roger Blouin

Judgment Debtor

Anne-Marie Blouin

Garnishee / Opposing Party

Rose-Hélène Blouin

Garnishee / Opposing Party

Madeleine Tardif-Blouin

Garnishee / Opposing Party

Procedural Posture

Income Tax Act Enforcement Garnishment Proceedings / Hearing on Confirmation of Provisional Garnishment and Objections Under Section 597 C.c.p.

Legal Issues

  1. 1 Did the money seized belong to the judgment debtor, Roger Blouin?
  2. 2 Are the repayments/transfers of December 3, 2002 enforceable against the seizing creditor under C.C.Q. arts.1631 et seq.?
  3. 3 Does the Federal Court have jurisdiction to decide allegations of incapacity-based invalidity of transactions?

Ratio Decidendi

The Court found it had jurisdiction to consider whether the December 3, 2002 transfers were unenforceable against the seizing creditor but not to adjudicate broader claims of incapacity-based invalidity. On the evidence the opposing parties proved by a preponderance that the transferred funds were theirs and the seizing creditor established the debtor's insolvency and his fraudulent intent to prefer relatives, but the seizing creditor failed to prove that the recipients (the opposing parties) shared that fraudulent intent or had knowledge of the debtor's insolvency such that the presumptions of art.1632 C.C.Q. applied. Accordingly, the objections to the garnishment succeed and the...

Court Disposition

Objections allowed; garnishments avoided; each party to bear own costs.

Orders

  • The three objections are allowed.
  • The seizure of certificates of deposit bearing numbers 555134565403, 555134561475 and 555134561327, following a requirement on December 20, 2002, and amended on February 7, 2003, is avoided.