http://decisions.fca-caf.gc.ca/fca-caf/decisions/en/item/229741/index.do
CBS Canada Holdings Co. v. Canada (March 31, 2017 – 2017 FCA 65, Pelletier (author), Rennie, Woods JJ.A.).
Précis: The taxpayer filed an affidavit by a Ms. Toaze, a lawyer for the taxpayer (not a lawyer acting as counsel in the proceedings but a member of the same firm), in a motion to enforce a settlement agreement with CRA. The Crown moved to strike the affidavit. The Tax Court Judge held that the affidavit was hearsay and exercised her discretion to exclude it. The taxpayer appealed to the Federal Court of Appeal. The Court of Appeal held that the Tax Court Judge erred in excluding the affidavit and allowed the appeal with costs both in the Court of Appeal and in the Tax Court.
Decision: The Court of Appeal reversed the Tax Court:
[43] To summarize, the Tax Court Judge erred in principle in concluding prematurely that the contents of the Toaze affidavit were tendered in proof of their contents. This error led to further errors as to the scope of cross-examination of Ms. Toaze on her affidavit and the appropriateness of her affirming her affidavit. This combination of errors led the Tax Court Judge to strike the Toaze affidavit without justification, a palpable and overriding error. As a result, I would allow the appeal with costs, set aside the Tax Court Judge’s order, and dismiss the motion to strike the Toaze affidavit, also with costs.
In particular the Court of Appeal found that there was nothing inappropriate in the choice of Ms. Toaze as affiant, as opposed to someone from the ranks of CBS Canada Holdings Co.
Thus the appeal was allowed with costs both in the Court of Appeal and in the Tax Court.
Comment: The Court of Appeal’s decision is perhaps only surprising insofar as it endorses the use of affidavits from members of a counsel’s law firm (rather than from the client) in very contentious proceedings. In my view the Crown should seek the opinion of the Supreme Court on this question since it touches on a very broad range of litigation practice and this result seems somewhat suspect by modern standards of practice.