R. v. BCS Group Business Services Inc. – FCA: A corporation cannot be represented by a non-lawyer agent in General Procedure appeals before the Tax Court – TCC decision reversed

R. v. BCS Group Business Services Inc. – FCA:  A corporation cannot be represented by a non-lawyer agent in General Procedure appeals before the Tax Court – TCC decision reversed



Canada v. BCS Group Business Services Inc. (December 2, 2020 – 2020 FCA 205, Gauthier (Author), de Montigny, Locke JJ.A.).

Précis:   The Respondent, BCS, argued successfully before the Tax Court that it should be able to conduct its general procedure using its sole shareholder, director and officer, Mr. Denis Gagnon (who is not a lawyer), as its agent.  The Crown appealed.  The Federal Court of Appeal in a detailed and scholarly opinion authored by Gauthier J.A. concluded that the Tax Court was in error and that the Tax Court of Canada Act, R.S.C., 1985, c. T-2, particularly section 17.1 of that statute, precluded the use of a non-lawyer agent in General Procedure appeals.  It is highly unlikely that the Supreme Court would be willing to review this question so the BCS Group decision is likely to be the final word on the subject for the indefinite future unless Parliament chooses to amend the Tax Court of Canada Act (which also seems an unlikely prospect).

Decision:   The Court of Appeal resisted the argument that the unique position of the Tax Court should lend itself to the disputed construction:

[54]  Finally, I cannot agree with the comments of the TCC at paragraph 8 of the Order, that suggest that it is relevant here to consider the uniqueness of the TCC. Like the TCC (GP Rule 4), other courts, including this Court and the Federal Court have a practice Rule (see Rule (3) of Federal Courts Rules, SOR/98-106), describing the need to construe their Rules and apply them to secure the just and most expeditious and least expensive determination of the proceedings on its merits. But as mentioned, this does not mean that artificial entities such as corporations are given an automatic right to appear in person, nor that it allows the TCC to construe the Act in accordance with its own policy preference.

In the opinion of Gauthier J.A. the issue was cut and dried:

[61]  Hence, I cannot agree that how section 17.1 would apply in any given case was left open. In fact, as mentioned, at the time the Act came into force, the GP Rules of the TCC had already been approved and published, and GP Rule 30(2) was clearly in line with my purposive interpretation of section 17.1.

[62]  In 1988, the adoption of the General Procedure and the restriction as to who could represent a party (see paragraph 36) was a major change in the procedure to be followed by the judges of the Tax Review Board, who were now sitting on the TCC, as well as the new judges appointed in 1983, for they now had to follow more formal rules that characterized a court of law such as the Federal Court. The purpose of this restructuration may have been lost in the last iterations of the GP Rules, especially because it is somewhat unusual to find a statutory provision dealing expressly with matters of procedures such as the one under discussion.

[63]  Certainly, section 17.1 could have been worded more clearly, as was the 1990 version of GP Rules 30(1) and (2). However, at the relevant time, nobody could have thought that a corporation could appear in person.

Thus the Crown’s appeal was allowed and the order of the Tax Court which permitted M. Gagnon to appear as agent was set aside.  No costs were awarded as the Crown did not ask for costs.