This week at the SCC

The Supreme Court of Canada will hear four appeals this week, three civil and one criminal.

The Supreme Court of Canada will hear four appeals this week, three civil and one criminal. The appeals concern whether the British Columbia Investment Management Corp. must collect and pay GST; whether an Ontario professional corporation had “knowing participation” in a massive fraud; and in Quebec, whether a naturopath was guilty of manslaughter in the death of a patient and whether a journalist must disclose her sources.

May 13 – British Columbia – A.G. of Canada v. British Columbia Investment Management Corp.

Constitutional law: B.C. Investment Management is a provincial Crown corporation incorporated under the Public Sector Pension Plans Act; it also holds property respect in trust. As a provincial Crown corporation, it benefits from B.C.’s immunity from federal taxation in to its property. The majority of the funds held by bcIMC are investments of the five B.C. public-sector pension plans, in pooled portfolios. bcIMC does not collect GST on investment management services for pooled investment portfolios, but it does for other clients who have money in other portfolios. bcIMC was assessed for GST and asked by the attorney general of Canada to pay $40.5 million. The corporation argues it is not subject to payments under the Excise Tax Act but is bound by the Reciprocal Tax Agreement and the Comprehensive Integrated Tax Coordination Agreement, which may require it to collect and remit certain taxes.

Read the appellate court decision here.

May 14 – Ontario – Christine DeJong Medicine Professional Corp. v. DBDC Spadina Ltd.
Tort law: A couple, Norma and Ronauld Walton, committed massive real estate fraud in Toronto over the course of several years, asking individuals to invest with them and then shuffling the funds through a clearinghouse. The parties in the case had invested separately, in several projects, with the Waltons, and in 2013 they launched complex oppressive proceedings against the clearinghouse, which they charged had engaged in knowing participation of fraud. The Ontario Superior Court of Justice awarded $16 million against the Waltons, who were convicted of fraudulent misrepresentation. Late during the oppression proceedings launched by the DBDC parties (the investors), the DBDC parties alleged that the DeJong Professional Corporation, also an investor, had engaged in knowing participation and knowing receipt in the Waltons’ fraud.

The DBDC parties’ claim that the DeJong PC had knowingly participated in a fraudulent and dishonest breach of fiduciary duty was dismissed. The Court of Appeal allowed the DBDC parties’ appeal with respect to knowing participation.

Read the appellate court decision here.

Related legal briefs:
Supreme Court to Rule on Conflicting Rights of Investors in Fraudulent Schemes; Baker & McKenzie LLP

Fraud and Knowing Assistance—Between the Innocents; Bennett Jones LLP

The Ontario Court of Appeal Applies Knowing Assistance Doctrine To Allow Damages Against Corporations In Fraud "Shell Game" Case; Babin Bessner Spry LLP

May 15 – Quebec – Javanmardi v. R.

Criminal law: The appellant is a naturopath who administered treatment to a patient for fluid in the lungs; the patient later died in hospital because of what had been injected. The naturopath was charged with manslaughter and criminal negligence causing death but was acquitted on both counts. The Court of Appeal allowed the Crown’s appeal, substituted a conviction for the acquittal on the manslaughter charge and ordered a new trial on the charge of causing the patient’s death by criminal negligence. Whether the essential elements of those two crimes were established is what the Supreme Court will hear argued.

Read the appellate court decision here.

Related news stories:
Naturopath guilty of manslaughter will get hearing at Supreme Court; CTV News

Montreal naturopath found guilty of manslaughter as Quebec Court of Appeal overturns acquittal; CBC News

May 16 – Quebec – Denis v. Côté

Canadian Charter: Marc-Yvan Côté was a former Quebec MP who was subject to a police investigation for fraud, bribery and breach of trust. He alleged that during the investigation certain documents ended up in the hands of a journalist, who published details. Côté filed a motion alleging the information disclosed had been deliberately leaked by an agent of the state, which compromised his trial. He asked for a stay of proceedings and tried to compel the journalist, Marie-Maude Denis, to testify in order to identify the leaks. She applied for a summons to have the witness identification quashed, relying on the principle of journalistic protection of sources.

The Court of Quebec dismissed the motion to divulge identification of sources under a new rule of the Canada Evidence Act. The Quebec Superior Court allowed Côté’s appeal and authorized the disclosure by Denis of the identity of her confidential sources. The Quebec Court of Appeal dismissed a subsequent appeal by Denis, finding that it had no jurisdiction over her appeal under s. 39.1(10) of the Canada Evidence Act.

Read the appellate court decision here.

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