Canadian Lawyer

w w w . C A N A D I A N L a w y e r m a g . c o m M A Y 2 0 1 6 13 \ AT L A N T I C \ C E N T R A L \ W E S T REGIONAL WRAP-UP T he old maxim "a day late and dollar short" got new meaning for one big bank recently as the British Columbia government got leave to appeal a B.C. Supreme Court decision that told it to reconsider a $2,839,421 tax refund owed to the Toronto Dominion Bank after it had earlier denied the refund because the application came a day late. The nub of the case is how each party counts the days set out in two statutes that impact the filing deadline for the tax refund as both sides argue the merits of their own tally system. The B.C. Court of Appeal waded into the debate as there is legal issue of how two legal statutes are related when inter- preting deadlines and the province is arguing the case has an impact beyond the current debate in The Toronto Dominion Bank v. British Columbia. "The result of the appeal may affect the interpretation of other statutes," said Appeal Court Justice Nicole J. Garson in reasons, after hearing the case in cham- bers. "It concerns the interpretation of a statute, which is a question of law. There is no directly applicable appellate authority on the points in issue." The difficulty arose when the TD applied for a tax refund for the 2012 taxation year, which ended Oct. 31, 2012, under the International Business Activity Act. The refund can be filed up to 18 months after the close of the corporate year. The refund application was couriered to the B.C. Ministry of Finance on April 30, 2014 and received May 1, 2014. The ministry took the position the bank wasn't entitled to a refund because it missed the filing date dead- line as set out under the IBAA by a day. The TD bank then applied to the B.C. Commissioner of Income Tax for a one-day extension of the filing per- iod, which was subsequently denied. The bank's plea then went to the B.C. minister of finance in July 2015 where it fell on deaf ears. The bank sought a judicial review of the government's decision and filed in B.C. Supreme Court to have two peti- tions heard, one seeking a review of the commissioner's decision refusing the one-day extension and a second appeal- ing the minister's decision that the return was filed late. The two reviews were consolidated into one and heard. The TD bank argued that the filing period as set out in s. 24(1) of the stat- ute and applicable to TD's fiscal year started Nov. 1, 2012 or the first day after the end of the taxation year. But, under s. 25 (5) of the Interpretation Act, TD said the first day of the period was excluded from the count. The bank argued that Nov. 2, 2012, was the first day of the 18-month filing interlude. Applying the definition of "month" in s. 29 of the Interpretation Act, the calendar period would then end Dec. 1. Applied over the 18-month period, the deadline ends May 1, 2014. While the B.C. government agreed with s. 25(5), it maintained the first day that was to be discounted was that day trig- gering the commencement of the new period, which was Oct. 31, and the end of the TD bank's taxation year. The first day then was Nov. 1 and the filing dead- line became April 30, 2014. B.C. Supreme Court Justice Laura B. Gerow agreed with the bank and ordered the minister to consider the TD application as it had met the filing dead- line. The B.C. government then filed for leave to appeal, arguing the chambers judge erred in her interpretation and there is ambiguity over how the two statutes involved in the case relate to one another. The B.C. Court of Appeal has now agreed and allowed the appeal. "This appeal will turn on the question of whether, on a proper interpretation of these sections, November 1, 2012, is the day after the end of the tax period and therefore should be excluded from the calculation of the time period," Garson reasoned. The appeal justice also sided with the province, agreeing that this was a ques- tion of law rather than simply one of determining the correct starting date for the deadline calculation of filing. But the question of law was not determinative. "In my view, the correctness of a legal standard is at the heart of this appeal, not whether a legal standard was correctly applied to the facts. The essential question is how IBAA, s. 24(1) and s. 25(5) of the Interpretation Act ought to be interpreted, in light of their interaction with each other," the justice reasoned in the appeal granting. "The Province says the correct interpretation of the Interpretation Act is generally important because it is a statute of general application. It says that the chambers judge's decision intro- duces uncertainty into the calculation of time under any statute to which the Interpretation Act applies that uses the same formula as the IBAA." There was no information available about when the appeal is scheduled to go forward. — JEAN SORENSEN jean_sorensen@telus.net Day late fi ling cost TD bank $2.8-million refund $2,839,421 31 OCTOBER

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