Date: 19990915
Docket: T-2268-98
BETWEEN:
CHEVRON CANADA RESOURCES LIMITED
Applicant
- and -
THE MINISTER OF NATIONAL REVENUE,
CUSTOMS, EXCISE AND TAXATION
Respondent
REASONS FOR ORDER
TEITELBAUM, J:
INTRODUCTION
This is an application by Chevron Canada Resources Limited "for judicial review of the failure of the respondent, Minister of National Revenue, Customs, Excise and Taxation to reassess the 1985 and 1986 taxation years of the applicant in accordance with the terms of a memorandum of understanding dated December 9, 1994 (the Memorandum of Understanding) (MOU)".
The applicant also seeks judicial review "of the refusal of the respondent, dated November 12, 1998, to grant the applicant's request dated October 28, 1998 to reassess the 1985 and 1986 taxation years of the applicant in the manner stipulated in the aforesaid memorandum of understanding.
As well, the applicant seeks a writ of mandamus "ordering the respondent to reassess the applicant in accordance with the provisions of the Income Tax Act, S.C. 1970-71-72 as amended to December 31, 1986 (the "Act") and the terms of the Memorandum of Understanding."
The grounds for the present application, as stated in the Application for judicial review are:
1. The respondent has a duty to assess the applicant for the correct amount of tax exigible under the Act.
2. The respondent has acknowledged in the Memorandum of Understanding that taxpayers such as the applicant are entitled to adjustments in calculating Resource Profits pursuant to Regulation 1204 of the Income Tax Regulations, Consolidated Regulations of Canada, c. 945, (the "Regulations") in respect of general and administrative expense, scientific research and experimental development expenditures, capital cost allowance prior to the year of commencement of production and pre-production expenses for the purpose of calculating its resource allowance pursuant to Regulation 1210 and the deduction stipulated in paragraph 20(1)(v.1) of the Act.
3. The applicant has filed a Waiver of the Limitation Period, set forth in subsection 152(4) and 152(5) of the Act for the respondent to reassess the applicant in respect of the calculation of its Resource Allowance in its 1985 and 1986 taxation years.
4. The applicant through its counsel has asked the respondent to reassess its 1985 and 1986 taxation years to increase its Resource Allowance deductible pursant to paragraph 20(1)(v.1) of the Act and the respondent has refused the applicant's request.
5. The failure of the respondent to reassess the applicant with the authority conferred on him by the Act is a breach of his statutory duty to assess the amount of the tax payable on the facts as he finds them in accordance with the law.
6. The respondent has failed to discharge his duties by declining to act in accordance with his jurisdiction under the Act.
7. In refusing to reassess the applicant in accordance with the relevant facts and the Act, the respondent has acted in an arbitrary and capricious manner in the exercise of his statutory duty under the Act.
8. In refusing to reassess the applicant in accordance with the relevant facts and the Act, the respondent has exercised his statutory duty under the Act in a discriminatory manner.
9. The respondent has a duty to act fairly and in an even-handed manner in the exercise of his statutory duty under the Act. He has failed in that duty by refusing to reassess the applicant's 1985 and 1986 taxation years while at the same time having reassessed other taxation years of the applicant and of other taxpayers on the basis that the applicant now seeks to have applied to those years.
10. The applicant relies on subsections 152(1), 152(4) and 152(4.1) of the Act.
FACTS
The applicant signed two Waivers dated October 3, 1988 and April 16, 1990 in respect to the normal time period for reassessment of the 1985 and 1986 taxation years. The applicant has not revoked the two waivers relating to the 1985 and 1986 taxation years.
By Notices of Reassessment dated January 27, 1989 and August 9, 1990 the respondent reassessed the applicant for its 1985 and 1986 taxation years.
Notices of Objection dated April 7, 1989 and November 6, 1990 were filed by the applicant in respect of the aforementioned reassessments. The main issue was the manner of calculation of the applicant's resource profits and resource allowance ( "the Resource Allowance Issue").
By Notifications of Confirmation dated December 31, 1991, the reassessments of the 1985 and 1986 taxation years were confirmed by the respondent. The notification of confirmation can be seen at Tabs G and H in the respondent's Motion Record. The Notification informs the applicant that the Minister gave consideration to the facts and reasons set forth in the reassessments for 1985 and 1986 taxation years for which the applicant had signed waivers.
Effectively, when the respondent sent out its Notices of Reassessment for the 1985 and 1986 taxation years, the Waivers signed by the applicant became redundant, that is to say that the respondent was not holding the 1985 and 1986 taxation years reassessed in abeyance.
By separate Notices of Appeal dated March 25, 1992, the applicant appealed the confirmation of reassessments issued in respect of its 1985 and 1986 taxation years to the Tax Court of Canada. On May 15, 1992, the Tax Court of Canada agreed to combine all of the issues raised on appeal by the applicant into one appeal.
A Status Hearing for the applicant's appeal was held on November 19, 1993 and a trial date was set for September 14, 1994.
The following were the issues raised by the applicant in its Notice of Appeal filed with the Tax Court of Canada:
(a) are delay lease rentals on undeveloped lands deductible from income as a current expense or capitalized and added to Canadian Oil and Gas Property Expenses ("COGPE");
(b) are Scientific Research and Experimental Development Expenses ("SR & ED") and Crown lease rentals on unproductive lands required to be deducted in the computation of resource profits for the purposes of resource allowance;
(c) is interest income properly characterized as active business or investment income for the purposes of calculating its Manufacturing and Processing ("M & P") profit; and
(d) are royalties in respect of liquefied petroleum gases ("LPG's") deductible in calculating income.
The applicant filed, on December 20, 1993, an Amended Notice of Appeal in the Tax Court action withdrawing the issue of deductibility of royalties in respect to liquified petroleum gases ("LPG").
The parties reached a settlement on the remaining issues of the appeal and Minutes of Settlement dated September 9, 1994 indicate that the applicant's appeal be allowed and referred back to the Minister for reconsideration and reassessment in accordance with the Consent to Judgment. Judgment by the Tax Court of Canada was rendered on September 20, 1994, allowing the appeal and referring the assessments back to the Minister. Neither party appealed the decision of the Tax Court.
The Consent to Judgment states:
The Appellant and the Respondent consent to Judgment allowing the appeal with respect to the Appellant's 1985 and 1986 taxation years, without costs, and referring the matter back to the Minister of National Revenue for reconsideration and reassessment on the basis that:
(a) $2,284,161 of the Appellant's income from its short term investments in its 1985 taxation year and $662,861 of the Appellant's income from its short term investments in its 1986 taxation year constitute income from an active business for the purposes of calculating the Appellant's manufacturing and processing deduction pursuant to section 125.1 of the Income Tax Act ; and
(b) neither the Appellant's scientific research expenditures nor its crown lease rental payments are to be deducted under paragraph 1204(1)(f) of the Income Tax Regulations , or otherwise, in the calculation of resource profits for the purpose of paragraph 20(1)(v.1) of the Income Tax Act.
The Appellant is not entitled to any further relief.
Dated at Calgary, this 9th date of September 1994.
The Judgment in the Tax Court states:
Upon reading the Consent to Judgment filed:
The appeals from the assessments made under the Income Tax Act for the 1985 and 1986 taxation years are allowed, without costs, and the assessments are referred back to the Minister of National Revenue for reconsideration in accordance with the terms of the attached Consent to Judgment.
Signed at Ottawa, Canada
this 20th day of September 1994.
Just prior to the Consent to Judgment being filed in the Tax Court action, the Federal Court of Appeal issued a judgment in the case of The Queen v. Gulf Canada Resources Ltd., 1992 DTC 6123 (FCA) which dealt with the Resource Allowance Issue.
Subsequent to the Gulf Canada (supra) decision and prior to the parties in the case at bar filing Minutes of Settlement and the Consent to Judgment in the Tax Court action, the Canadian Association of Petroleum Producers ( "CAPP") and Revenue Canada commenced negotiations to resolve the Resource Allowance Issue, pursuant to section 20(1)(v.1) of the Income Tax Act , S.C. 1970-71-72, c. 63.
At no time prior to the signing of the Minutes of Settlement or prior to the signing of the Consent to Judgment, or prior to the signing of the Judgment in the Tax Court of Canada, did the applicant request an adjournment of the Tax Court case or do anything to ensure that the calculation of the Resource Allowance Issue would be changed in accordance with the expenses that were the subject of the Gulf Canada case and that were the subject of the negotiations between CAPP & Revenue Canada.
The negotiations between CAPP and the respondent resulted in a Memorandum of Understanding ( "MOU") which was agreed to in principle but it was clearly understood that its terms were not binding on the members of CAPP.
By Notices of Reassessment dated February 14, 1995 in respect of the 1985 and 1986 taxation years, the applicant was reassessed to give effect to the September 20, 1994 Tax Court of Canada Judgment which Judgment was based on the Consent to Judgment signed by the parties on September 8, 1994.
Notices of Objection were filed by the applicant on February 28, 1995 in respect to these reassessments on the basis that the respondent failed to comply with the terms of the MOU to allow the applicant an adjustment in the calculation of Resource Allowance.
Pursuant to section 173 of the Income Tax Act, the parties proceeded with a reference to the Tax Court of Canada to determine whether the applicant had the legal right to file the Notice of Objection dated February 28, 1995. On March 4, 1997, the decision was rendered in favour of the applicant subject to the condition that the issue of royalties on LPG's could not be raised again because "this item was withdrawn in conformity with the Tax Court settlement.
On appeal to the Federal Court of Appeal from the decision of the Tax Court of Canada, the question posed was whether the applicant was entitled to pursue its objection with respect to the computation of the Resource Allowance Issue.
In a decision dated September 28, 1998, the Federal Court of Appeal held that the computation of the applicant's resource allowance had been raised before the Tax Court of Canada and dealt with conclusively in the Consent Judgment. Therefore, pursuant to subsection 165(1.1) of the Act, the applicant was not entitled to file Notices of Objection to the reassessments dated February 14, 1995.
On October 28, 1998 the applicant requested by letter that the respondent reassess the 1985 and 1986 taxation years in respect to the Resource Allowance issue. The respondent replied on November 12, 1998 that no reassessment was intended because of the decision of the Federal Court of Appeal and that it was open to the applicant, if it so wished, to seek leave to appeal the Federal Court decision to the Supreme Court. The applicant did not seek leave to appeal.
SUBMISSIONS
Applicant's Submission
The applicant submits that the respondent has the authority, and must exercise that authority, to reassess the 1985 and 1986 taxation years on the basis that the Waivers filed in respect of these years have never been revoked. The applicant argues that the waivers apply specifically to the computation of the Resource Allowance Issue and that reassessments may continue as necessary under the Waivers.
Secondly, the applicant submits that the conditions for an order of mandamus have been met:
(1) the respondent has a clear statutory duty to assess taxpayers in accordance with the law, which is the Memorandum of Understanding in this case;
(2) the failure of the applicant to raise this matter in the Consent Judgment does not permit the respondent to avoid their statutory duty to reassess the applicant;
(3) the applicant is the person to whom the duty is owed by the respondent as they are the person filing the income tax return;
(4) the applicant has a right to the performance of the statutory duty by the respondent.
The applicant argues that the failure of the respondent to reassess the applicant is contrary to the law as the respondent must exercise his statutory duty. In this case, the Memorandum of Understanding represents the law and therefore should be applied.
An order of mandamus should be granted accordingly so that reassessments of the 1985 and 1986 taxation years will be undertaken. This would provide the only opportunity for the applicant to have these taxation years reconsidered, and the law applied in accordance with the terms of the MOU.
Respondent's Submissions
The respondent submits that the applicant raised the issues which it now seeks to have considered in its Notices of Objection which were filed with the Tax Court of Canada and subsequently appealed to the Federal Court of Appeal. It was determined by the Federal Court of Appeal that the Resource Allowance Issue had been conclusively decided by the Consent Judgment. Thus, the matter is now res judicata and full effect must be given to the judgment.
It is further submitted by the respondent that this is not a proper case for the Court to exercise its jurisdiction under section 18 of the Federal Court Act R.S.C. 1985, c. F-7. By issuing a writ of mandamus, the Court would be in effect challenging the reassessments done pursuant to the Consent Judgment and acting beyond the scope of its jurisdiction.
ISSUES
This application for judicial review raises the following issues:
(1) Is it within the scope of the Court's jurisdiction to grant a writ of mandamus obliging the respondent to reassess the applicant's 1985 and 1986 taxation years?
(2) Does the respondent have the authority to reassess the applicant's 1985 and 1986 taxation years under the Waivers filed?
(3) Does the Memorandum of Understanding form part of the law?
STATUTORY PROVISIONS
| s.18 (1) Extraordinary remedies, federal tribunals - subject to section 28, the Trial Division has exclusive jurisdiction (a) issue an injunction, writ of certiorari, writ of prohibition, writ of mandamus, or writ of quo warranto, or grant declaratory relief, against any federal board, commission or other tribunal; and (b) to hear and determine any application or other proceeding for relief in the nature of relief contemplated by paragraph (a), including any proceeding brought against the Attorney General of Canada, to obtain relief against a federal board, commission or other tribunal. |
Recours extraordinaires_: offices fédéraux 18. (1) Sous réserve de l'article 28, la Section de première instance a compétence exclusive, en première instance, pour_: a) décerner une injonction, un bref de certiorari, de mandamus, de prohibition ou de quo warranto, ou pour rendre un jugement déclaratoire contre tout office fédéral; b) connaître de toute demande de réparation de la nature visée par l'alinéa a), et notamment de toute procédure engagée contre le procureur général du Canada afin d'obtenir réparation de la part d'un office fédér |
| Judicial review 28. (1) The Court of Appeal has jurisdiction to hear and determine applications for judicial review made in respect of any of the following federal boards, commissions or other tribunals: (a) the Board of Arbitration established by the Canada Agricultural Products Act; (b) the Review Tribunal established by the Canada Agricultural Products Act; (c) the Canadian Radio-television and Telecommunications Commission established by the Canadian Radio-television and Telecommunications Commission Act; (d) the Pension Appeals Board established by the Canada Pension Plan; (e) the Canadian International Trade Tribunal established by the Canadian International Trade Tribunal Act; (f) the National Energy Board established by the National Energy Board Act; (g) [Repealed, 1992, c. 49, s. 128] (h) the Canada Labour Relations Board continued by the Canada Labour Code; (i) the Public Service Staff Relations Board established by the Public Service Staff Relations Act; (j) the Copyright Board established by the Copyright Act; (k) the Canadian Transportation Agency established by the Canada Transportation Act; (l) the Tax Court of Canada established by the Tax Court of Canada Act; (m) umpires appointed under the Employment Insurance Act; (n) the Competition Tribunal established by the Competition Tribunal Act; (o) assessors appointed under the Canada Deposit Insurance Corporation Act; and (p) the Canadian Artists and Producers Professional Relations Tribunal established by subsection 10(1) of the Status of the Artist Act. |
| Contrôle judiciaire 28. (1) La Cour d'appel a compétence pour connaître des demandes de contrôle judiciaire visant les offices fédéraux suivants_: a) le conseil d'arbitrage constitué par la Loi sur les produits agricoles au Canada; b) la commission de révision constituée par cette loi; c) le Conseil de la radiodiffusion et des télécommunications canadiennes constitué par la Loi sur le Conseil de la radiodiffusion et des télécommunications canadiennes; d) la Commission d'appel des pensions constituée par le Régime de pensions du Canada; e) le Tribunal canadien du commerce extérieur constitué par la Loi sur le Tribunal canadien du commerce extérieur; f) l'Office national de l'énergie constitué par la Loi sur l'Office national de l'énergie; g) [Abrogé, 1992, ch. 49, art. 128] h) le Conseil canadien des relations du travail au sens du Code canadien du travail; i) la Commission des relations de travail dans la fonction publique constituée par la Loi sur les relations de travail dans la fonction publique; j) la Commission du droit d'auteur constituée par la Loi sur le droit d'auteur; k) l'Office des transports du Canada constitué par la Loi sur les transports au Canada; l) la Cour canadienne de l'impôt constituée par la Loi sur la Cour canadienne de l'impôt; m) les juges-arbitres nommés en vertu de la Loi sur l'assurance-emploi; n) le Tribunal de la concurrence constitué par la Loi sur le Tribunal de la concurrence; o) les évaluateurs nommés en application de la Loi sur la Société d'assurance-dépôts du Canada; p) le Tribunal canadien des relations professionnelles artistes-producteurs constitué par le paragraphe 10(1) de la Loi sur le statut de l'artiste. |
| Trial Division deprived of jurisdiction (3) Where the Court of Appeal has jurisdiction to hear and determine any matter, the Trial Division has no jurisdiction to entertain any proceeding in respect of the same matter. Income Tax Act, R.S.C., 1985 (5th Supp.) C.1, subsection 165(1) as amended 165(1) A taxpayer who objects to an assessment under this Part may serve on the Minister a notice of objection, in writing, setting out the reasons for the objection and all relevant facts, (a) where the assessment is in respect of the taxpayer for a taxation year and the taxpayer is an individual (other than a trust) or a testamentary trust, on or before the later of (i) the day that is one year after the taxpayer's filing-due date for the year, and (ii) the day that is 90 days after the day of mailing the notice of assessment. (1.1) Notwithstanding subsection (1), where at any time the Minister assesses tax, interest or penalties, payable under this part by, or makes a determination in respect of , a taxpayer (a) under subsection 67.5(2), subparagraph 153(4)(b)(i) or subsection 154(4.3) or (6) or 164(4.1), 220(3.4) or 245(8) or in accordance with an order of a court vacating, varying or restoring the assessment or referring the assessment back to the Minister for reconsideration and assessment, (b) under subsection (3) where the underlying objection relates to an assessment or a determination made under any of the provisions or circumstances referred to in paragraph (a), or (c) under a provision of an Act of Parliament requiring an assessment to be made that, but for that provision, would not be made because of subsections 152(4) to (5), the taxpayer may object to the assessment or determination within 90 days after the day of mailing of the notice of assessment or determination, but only to the extent that the reasons for the objections can be reasonably regarded as relating to a matter that gave rise to the assessment or determination and that was not conclusively determined by the court, and this subsection shall not be construed as limiting the right of the taxpayer to object to an assessment or determination issued or made before that time. |
| Incompétence de la Section de première instance (3) La Section de première instance ne peut être saisie des questions qui relèvent de la Cour d'appel. 165(1) Le contribuable qui s'oppose à une cotisation prévue par la présente partie peut signifier au ministre, par écrit, un avis d'opposition exposant les motifs de son opposition et tous les faits pertinents, dans les délais suivants (a) lorsqu'il s'agit d'une cotisation relative à un contribuable qui est un particulier (sauf une fiducie) ou une fiducie testamentaire, pour une année d'imposition, au plus tard le dernier en date des jours suivants: (i) le jour qui tombe un an après la date d'échance de production qui est applicable au contribuable pour l'année, (ii) le 90è jour suivant la date de mise à la poste de l'avis de cotisation; (b) dans les autres cas, au plus tard le 90è jour suivant la date de mise à poste de l'avis de cotisation. (1.1) Malgré le paragraphe (1), dans le cas où, à un moment donné, le ministre établit un cotisation concernant l'impôt, les intérêts ou les pénalités payables par un contribuable en vertu de la présente partie ou détermine un montant à l'égard d'un contribuable: (a) soit en application du paragraphe 67.5(2), du sous alinéa 152(4)(b)(i) ou des paragraphes 152(4.3) ou (6), 164(4.1), 220(3.4) ou 245(8) ou en conformité avec l'ordonnance d'un tribunal qui annule, modifie ou rétabliet la cotisation ou la renvoie au ministre pour nouvel examen et nouvelle cotisation; (b) soit en application de paragraphe (3), à la suite d'un avis d'opposition relatif à une cotisation établie ou un montant déterminé en application des dispositions visées à l'alinéa a) ou dans les circonstances qui y sont indiquées; (c) soit en application d'une disposition d'une loi fédérale exigeant l'établissement d'une cotisation qui sans cette disposition, ne sera pas établie en vertu des paragraphes 152(4) à (5). Le contribuable peut faire opposition à la cotisation ou au montant déterminé dans les 90 jours suivant la date de mise à la poste de l'avis de cotisation ou de l'avis portant un montant a été déterminé seulement dans la mesure où il est raisonnable de considérer que les motifs d'opposition sont liés à une question qui a donné lieu à la cotisation ou au montant déterminé et que le tribunal n'a pas tranchée définitivement; toutefois, le présent paragraphe n'a pas pour effet de limiter le droit du contribuable de s'opposer à quelque cotisation établie ou montant déterminé avant le moment donné. |
ANALYSIS
The Applicability of the Waivers
Beginning with the first issue, the waivers filed by the applicant deal with the resource allowance issue and have never been revoked. This is not in dispute.
The applicant submits that the waivers give the respondent the authority to reassess the 1985 and 1986 taxation years as there can be no limitation of the right of the Minister to reassess the matter stipulated in the waiver if there has been no revocation.
The waivers were filed within the prescribed time limit and clearly dealt with the computation of resource profits and resource allowance thereby giving the Minister the right to reassess as often as is necessary regarding these matters.
The respondent submits that while the applicant filed valid waivers in respect of the resource allowance issue, this gives the Minister the statutory authority to reassess but creates no duty to do so. It is a purely discretionary matter.
In the case at bar, the Minister did reassess following the waivers filed by the applicant. Moreover, further reassessments were issued subsequent to the Consent Judgment.
While I am in agreement with the submission of the applicant that the waivers are unlimited and enable the Minister to reassess as often as required, he is not obliged by the waivers to reassess. Therefore, although he has the authority to act on the waiver, he is under no duty, particularly after several reassessments have already been issued.
The applicable law for granting an Order of Mandamus
Turning to the second submission, the applicant argues that the requirements governing the grant of an order of mandamus are satisfied by the facts of this case. Firstly, the Minister had a duty which he owed to the applicant. The applicant had a right to this duty, to have the reassessment performed in accordance with the law, and was denied this right by the failure of the Minister to apply the Memorandum of Understanding which represents the law.
I have carefully reviewed the events which led to the Memorandum of Understanding being signed by the parties on December 4, 1994 and have considered the intentions of the parties in drafting this agreement. I am satisfied that the Agreement represented no more than an agreement in principle. It does not form part of the law and does not bind either party to the agreement, that is, it did not bind any member of the Canadian Association of Petroleum Producers.
The facts establish unequivocally that the applicant was aware upon receiving the reassessments of February 1995, if not before, that the Memorandum of Understanding was not applicable to the computation of the 1985 and 1986 taxation years. This is evidenced by the applicant's immediate filing of a Notice of Objection against those reassessments.
Yet in the case at bar the applicant seeks to raise the same matters raised in the Notice of Objection dated February 28th, 1995. The issues being raised are as follows: the pre-production capital cost allowance, reproduction operating expenses and general administrative costs in the computation of resource profits and the resulting increase resource allowance.
The respondent submits that these are the very matters that were raised in the litigation before the Tax Court of Canada and were the subject of the Consent Judgment. Thus, they are now res judicata. I agree.
It is submitted that the applicant filed Notices of Appeal and filed amended Notices of Appeal and could have raised these issues at any time during that process. The respondent argues that the applicant knew of these facts prior to the Consent Judgment, no new facts have arisen and no new evidence has been admitted to enable these matters to be reconsidered.
The Reasons of the Federal Court of Appeal
The respondent relies on the decision of the Federal Court of Appeal which states at paragraph 37:
Applying this principle [res judicata], it seems clear that the issues which the respondent now attempts to raise formed a logical and, indeed, an integral part of the litigation that was before the Tax Court prior to the Consent Judgment being entered, and that these issues could and should have been raised at the time. The respondent was before the proper forum, the computation of its resource allowance clearly in issue and the additional contentions with respect to this computation known to it and capable of being raised; yet they were not brought forth for reasons that remain unexplained. The rule is that a party who under conditions omits to raise an issue is forever barred from raising it again. To the extent that this rule applies, the matters of the computation of the respondent's resource allowance must be held to have been conclusively determined by the consent judgment.
I am in agreement with my colleague Noël J. for the reasons that he has so succinctly articulated in his decision. There was ample opportunity for these matters to be raised before the proper forum, the Tax Court of Canada, and dealt with accordingly in the Consent Judgment. There has been no reason given for this omission except that it was an error.
From the outset, the respondent has stated that the applicant has no right to file Notices of Objection as the issues concerned have been conclusively dealt with by the Tax Court of Canada. Subsection 165(1.1) of the Income Tax Act precludes the applicant from filing Notices of Objection relating to matters which were previously resolved, in this case by the Consent Judgment.
I am satisfied that subsection 165(1.1) of the Act was enacted with the intention of limiting the right of reassessment of matters forming the subject of a judgment by the Court. In effect, it serves as a reinforcement on the rule of res judicata in the context of appeals against an amount of assessment.
It is argued by the respondent that to grant a writ of mandamus would indirectly allow the applicant to file a Notice of Objection following the reassessment and that this amounts to a collateral attack against the Reasons of the Federal Court of Appeal.
Other than seeking leave to appeal to the Supreme Court of Canada, all appeals have been exhausted in this case. The Income Tax Act provides for a full appeal procedure which is the only source of remedy available to the applicant. The facts show that the applicant availed himself of this procedure in obtaining the Consent Judgment. The applicant now seeks a writ of mandamus to allow them to file further Notices of Objection. This is exactly what the Federal Court of Appeal found to be precluded by subsection 165(1.1) of the Act.
I am satisfied that the central question in this application is the amount of tax assessed in the 1985 and 1986 taxation years. It is also clear to me that this formed the basis of the Consent Judgment as well as the decision of the Federal Court of Appeal, and that the matters raised here ought to have been brought forward in the litigation before the Tax Court of Canada.
To allow this application to proceed would be to reconsider the issues agreed upon in the Consent Judgment and to overrule the decision of the Federal Court of Appeal.
Pursuant to subsection 28(3) of the Federal Court Act, this Court has no authority at this stage of the proceeding to entertain such an application under section 18 of the Federal Court Act. The application is hereby dismissed.
The present application for judicial review is denied with costs in favour of the respondent.
"Max M. Teitelbaum"
J.F.C.C.
Ottawa, Ontario
September 15, 1999