Picard v. The Queen, 2009 FCA 370

Federal Court of Appeal, December 14, 2009

Available at: http: http://www.canlii.org/en/ca/fca/doc/2009/2009fca370/2009fca370.html

The Federal Court of Appeal denied the Appellant’s argument regarding the application of the s. 87 Aboriginal tax exemption, pursuant to the connecting factors approach.

The facts leading to the litigation are as follows:

The Appellant, a credit consultant, is an Indian living on reserve with his family. While the head office of his business is located on reserve, his work is carried out off-reserve at his customer’s places of business.

The Appellant’s challenge of his reassessments issued by the Minister of National Revenue (M.N.R.) was denied by the Tax Court of Canada.

The Federal Court of Appeal (FCA) upheld the reassessments and dismissed the appeal. In doing so, the FCA applied the so-called “connecting factors” approach, as set out in the Williams case.

Létourneau J.A. also discusses the standard of review applicable to decisions of lower courts that apply the test. The finding from the application of the connecting factors approach by the merits judge is one of mixed fact and law to which the standard of palpable and overriding error must be applied. In other words, the Appellant Court cannot intervene to set aside or vary this finding unless it contains such an error.

Finally, and although this point was not in the Appellant’s official notice of appeal, Létourneau J.A. addresses the issue of potential conflict – resulting form the fact that the Tax Court judge heard the present case and that of the Appellant’s partner, with whom he was in conflict , within a day of each other – and concluded that there is no reason why a second hearing that may be interrelated with a first one should not be held before the same judge.