McFadyen v. Canada

McFadyen v. Canada Court (s) Database Federal Court of Appeal Decisions Date 2002-12-11 Neutral citation 2002 FCA 496 File numbers A-623-00 Decision Content Date: 20021211 Docket: A-623-00 Neutral citation: 2002 FCA 496 CORAM: ROTHSTEIN J.A. NOËL J.A. PELLETIER J.A. BETWEEN: NEIL BARRY MCFADYEN Appellant and HER MAJESTY THE QUEEN Respondent Heard at Ottawa, Ontario, on December 11, 2002. Judgment delivered from the Bench at Ottawa, Ontario, on December 11, 2002. REASONS FOR JUDGMENT OF THE COURT BY: ROTHSTEIN J.A. Date: 20021211 Docket: A-623-00 Neutral citation: 2002 FCA 496 CORAM: ROTHSTEIN J.A. NOËL J.A. PELLETIER J.A. BETWEEN: NEIL BARRY MCFADYEN Appellant and HER MAJESTY THE QUEEN Respondent REASONS FOR JUDGMENT (Delivered from the Bench at Ottawa, Ontario on December 11, 2002) ROTHSTEIN J.A. [1] Despite the argument of Mr. Binavince, we are unable to agree that the Tax Court Judge made any palpable or overriding error with respect to his conclusion that the appellant was ordinarily resident in Canada for purposes of the Income Tax Act, R.S.C. 1985 c. 1 (5th Supp). The facts are not in dispute. The conclusion of the Tax Court Judge is one of mixed fact and law and this Court will not intervene in such conclusion barring palpable and overriding error or a pure error of law being extricated from the mixed question, neither of which have been demonstrated here. [2] The appellant contended that the Tax Court Judge erred in assuming jurisdiction to determine whether the appellant was a resident of Japan pursuant to Article 4 of the Canada-Japan Tax Convention, S.C. 1986, c. 48, Part II. The appellant has not convinced us that this case is distinguishable from Crown Forest Industries Ltd. v. Canada, [1995] 2 S.C.R. 802 on this point. However, we make no comment on the Tax Court Judge's application of Crown Forest to the Canada-Japan Tax Convention (Reasons, paragraphs 134 to 151) as the appellant takes no issue with the decision of the Tax Court Judge on that point. [3] The appellant conceded that there was no factual basis for his argument under subsection 6(1) of the Charter and we have not been persuaded that the Tax Court Judge erred in his conclusion that paragraph 250(1)(e) of the Income Tax Act was not contrary to section 15 of the Charter. [4] However, to the extent that income tax has been paid on income in Japan that has also been assessed in Canada, the appellant would be entitled to a foreign tax credit. Counsel for the Minister so recognized, but questioned whether the evidence was sufficient to allow for the conclusion that taxes had indeed been paid in Japan. The Tax Court Judge made no finding as to whether tax was paid in Japan on the appellant's income from Schroeder Securities (Japan) Limited. In his amended reply, the Minister conceded the Schroeder income was taxable in Japan and the evidence was that tax was withheld from the appellant's income. There was no evidence to suggest that a refund was sought or obtained. It is apparent to us that a foreign tax credit should be available to the appellant. The Tax Court Judge made no finding which bars this relief. [5] We would allow the appeal only to the extent of remitting the matter to the Minister for purposes of allowing him to reconsider and reassess the appellant in accordance with paragraph 4 of these reasons. In doing so, the Minister is to take into account the foreign tax credit to which the appellant is entitled in respect of the Japanese income taxes withheld from his 1994 and 1995 Schroeder Securities (Japan) Limited income, as shown on page 207 of the Record in this Court, and in respect of the concession made by the Minister with respect to the appellant's December 1993 salary, as set forth at paragraph 75 of the respondent's original Memorandum of Fact and Law. [6] There will be no order as to costs. "Marshall Rothstein" J.A. FEDERAL COURT OF APPEAL NAMES OF COUNSEL AND SOLICITORS OF RECORD DOCKET: A-623-00 STYLE OF CAUSE: Neil Barry McFadyen v. Her Majesty the Queen PLACE OF HEARING: Ottawa, Ontario DATE OF HEARING: December 11, 2002 REASONS FOR JUDGMENT OF THE COURT: (Rothstein, Noël & Pelletier JJ.A.) RENDERED FROM THE BENCH BY: Rothstein J.A. APPEARANCES: Mr. Emilio Binavince and Ms. Helen Lanctôt FOR THE APPELLANT Mr. Ernest Wheeler and Ms. Gabrielle St-Hilaire FOR THE RESPONDENT SOLICITORS OF RECORD: BINAVINCE SMITH Ottawa, Ontario FOR THE APPELLANT Morris Rosenberg Deputy Attorney General of Canada FOR THE RESPONDENT