Briggs Bros. Student Transportation Ltd. v. Alberta (Attorney General), 2012 ABQB 455

Court of Queen ’ s Bench of Alberta Citation: Briggs Bros. Student Transportation Ltd. v. Alberta (Attorney General), 2012 ABQB 455 Date: 20120712 Docket: 0303 14423 Registry: Edmonton Between: Briggs Bros. Student Transportation Ltd. Respondent - and - The Minister of Revenue and Provincial Treasurer for the Province of Alberta, As Represented by the Attorney General of Alberta Applicant _______________________________________________________ Reasons for Judgment of the Honourable Mr.

Justice Donald Lee _______________________________________________________ Background [ 1 ] The Minister of Revenue and Provincial Treasurer for the Province of Alberta, as represented by the Attorney General of Alberta, (hereinafter “ the Crown ” ) filed a Notice of Motion on June 29, 2010 pursuant to Rule 244.1 of the Alberta Rules of Court for an Order dismissing the action on the basis that 5 years had passed without a “ thing ” having been done that materially advanced the action. [ 2 ] The Crown submits that the issues are:

A. Do the new Rules, particularly Rule 15.4 and 4.33 impact the issues or questions that this Court must answer? B. In the five year period immediately prior to June 29, 2010 had any “ thing ” been done which significantly advanced the action? (

i) Are negotiations in other tax appeals, a “ thing ” which materially advanced the action? (ii) Does Rule 15.4(2) apply? Facts [ 3 ] Briggs Bros. Student Transportation Ltd. is an Alberta corporation in the business of providing “ little yellow school buses ” in the province of Alberta. [ 4 ] Under the fuel tax rebate program governed by the Fuel Tax Act and the Fuel Tax Regulation in 1999, consumers could obtain a fuel tax rebate for fuel consumed in certain vehicles while they were being used for commercial purposes off public roads and areas (off-road ’ ).

The off-road use relied upon by the rebate applicant was idling time. [ 5 ] The amount of a fuel tax rebate is determined by multiplying the total litres of fuel used off-road by a rebate applicant by the per-litre tax paid on that fuel. [ 6 ] Determining the rebate applicants total litres of fuel used off-road requires the rebate applicant to establish 3 variables: the fuel consumption rate (litres per hour) while idling, the off-road time (hours) and the number of eligible vehicles actually idling off-road. [ 7 ] The procedure for obtaining a fuel tax rebate under the Fuel Tax Act and the Fuel Tax Regulation is as follows: a.

The applicant makes an application for a fuel tax rebate pursuant to s. 4(1) of the Fuel Tax Act; b. The Minister may grant a rebate of tax pursuant to s. 4(3) of the Fuel Tax Act and s. 5 of the Fuel Tax Regulation; c. The Minister may assess a person for an amount owing and penalties pursuant to ss. 12 and 12.1 of the Fuel Tax Act; d. A person who objects to an assessment may file a notice of objection pursuant to s. 17 of the Fuel Tax Act; e.

Upon receipt of the notice of objection, the Minister may reconsider the assessment and may vacate, confirm or vary the assessment pursuant to s, 17(4) of the Fuel Tax Act; f. If the assessment is confirmed, the applicant may appeal by filing a notice of appeal with the Court of Queens Bench pursuant to s. 18 of the Fuel Tax Act. [ 8 ] In June 1998, the Respondent applied through its agent and consultant, Dudak, for a rebate of $160,902.51 for off-road fuel

consumption for the period January 6, 1995 to December 31, 1997 ( “ the First Application ” ). [ 9 ] Following discussions, correspondence and amendment to the application, the government determined that the Respondent was entitled to a rebate of $141,386.14 and on March 18, 1999 issued a cheque accordingly. [ 10 ] On April 2, 2001, the government decided to disallow the previously granted rebate on the grounds that it was not satisfied that the Respondent ’ s supporting documentation was sufficient to establish, among other things, the fuel consumption rate of idling yellow school buses.

It demanded repayment of the $141,386.14 rebate, as well as $35,346.53 in penalties and a further $26,327.84 in interest, for a total reassessment of $203,060.51 ( “ the Reassessment ” ). [ 11 ] The Respondent filed with the Minister a Notice of Objection ( “ the Objection ” ) to the Reassessment in June 2001, which was denied. [ 12 ] The Respondent then filed a Notice of Appeal ( “ this Appeal ” ) commencing this action in the Court of Queen ’ s Bench of Alberta in August 2003.

The government filed a Reply to Notice of Appeal in October 2003. [ 13 ] Following the First Application, the Respondent continued to make applications for fuel tax rebates. Dudak also made applications for fuel tax rebates for a number of its other clients who operated yellow school buses.

Collectively these applications will be referred to as “ the Other Applications ” [ 14 ] The Other Applications included applications on behalf of the Respondent for fuel tax rebates for two time periods subsequent to the time period of the application under appeal — for claim periods ending August 31, 1999 and December 31, 2000.

The Other Applications also included applications by other school bus operators for the same time period as under this Appeal. [ 15 ] The Other Applications were also denied, and Dudak filed Notices of Objection ( “ the Other Objections ” ) to the denials in April 2005. [ 16 ] At issue, inter alia , in the Other Objections was the fuel consumption rate that should be applied to idling yellow school buses. [ 17 ] Prior to 2009, the government had applied a fuel consumption rate to idling yellow school buses of 2.0 litres per hour.

This number was not based on statistical survey evidence of fuel tax applicants ’ actual school buses, but rather was an arbitrary number used in the absence of statistical survey evidence that satisfied the government of the fuel consumption rate of idling yellow school buses. [ 18 ] In support of the Other Objections, Dudak submitted 14 fuel consumption surveys of yellow school bus operations showing that the average fuel consumption of its clients ’ idling yellow school buses was 4.83 litres per hour, not 2.0 litres per hour. [ 19 ] In a series of letters to Dudak dated between October 2009 and February 2010, the government accepted Dudaks fuel consumption surveys and agreed to resolve the Other Objections by applying a fuel consumption rate of 4.83 litres per hour multiplied by a 7% margin of error, for a fuel consumption rate of idling yellow school buses of 5.17 litres per hour.

None of these determinations by Alberta were appealed by any of the applicants. [ 20 ] On June 29, 2010, the Applicant brought this application to dismiss the Respondents Appeal pertaining to the First Application, alleging long delay pursuant to Rule 15.4 of the Rules of Court. [ 21 ] The sole issue in this appeal is this:

a. Is the determination by the government of the applicable fuel consumption rate for idling yellow school buses in October 2009 to February 2010 of 5.17 litres per hour a “ thing done to significantly advance ” this Appeal within the meaning of Rule 15.4(1)?

The Law [ 22 ] The test for whether dismissal for long delay is available under Rule 15.4 is whether 5 years have elapsed since the last thing done to “ significantly advance the action ” . [ 23 ] While the wording of the current Rule has been altered slightly from its predecessor (the former Rule 244.1), this Court has established that the change from “ materially advance the action ” in the old Rules of Court to “ significantly advance the action ” in the current Rules carries no difference in meaning.

Therefore case law dealing with what constitutes a “ material ” advancement is still applicable. [ 24 ] In Alberta v. Morasch , 2000 ABCA 24 at paras. 12-14 , the Alberta Court of Appeal stated that a “ thing ” is not required to be a procedural step, but may be anything that moves the action closer to trial in a meaningful way. [ 25 ] In Calgary (City of) v.

Chisan , 2000 ABCA 313 at para. 3 , the Alberta Court of Appeal determined that a “ thing ” does not have to be done in the within action, but may be done in “ a closely related action, when the proceedings are inextricably linked. ” Analysis [ 26 ] The Crown submits that the Other Objections were mere “ negotiation ” . Acknowledging that negotiation was involved, the key event is the result: a final determination of the off-road idling rate at 5.17 litres per hour.

The issue is whether the administrative action in which that determination was made is “ inextricably linked ” to this Appeal. [ 27 ] In 155569 Canada Limited v. Clarkson Gordon , 2004 ABQB 17 at paras. 33-35 , this Court determined that another proceeding may be “ inextricably linked ” if a thing done in the other proceeding determined the main issues in the action in which the application had been brought. In that case, the delay of the prosecution of the action occurred while the parties awaited the passage of a foreclosure action involving the same property and parties through various appeal levels.

The Court held that the proceedings were “ inextricably linked ” because the finding in the earlier proceedings regarding the validity or enforceability of a mortgage and assignment agreement bound the applicant and respondent in the dismissal application. [ 28 ] The Crown cites Haekel v. Canada, 2008 ABQB 701 , where this Court cited Angevine and four factors to be considered in determining if a related action is “ inextricably linked ” to the primary action: 1.

Are the two actions inextricably linked in the sense that the result in the related action would be “ legally or factually determinative ” of the issues in the primary action? 2. Will the issue determined in the related action be “ relevant and binding ” in the primary action? 3. Does the related action materially advance the primary action? 4. Could the decision in the related action be a “ barrier in law ” to the Court ’ s adjudicating the primary action?

[ 29 ] It is to be noted that the central issue is whether the two actions are “ inextricably linked ” and these four items are mere factors to be considered in deciding that issue. Therefore the Haekel factors are not an exhaustive 4-part test. [ 30 ] An issue that was determined in the Other Objections and that is to be determined in this Appeal is the fuel consumption rate for idling yellow school buses.

As a result of the overlapping issue, the government ’ s finding as to idling rate in the Other Objections is “ relevant ” to this Appeal. [ 31 ] The next issue is whether that finding as to the idling rate is “ legally or factually determinative ” or ‘ binding ” . [ 32 ] The finding by the government of the off-road idle rate of 5.17 litres per hour in the Other Applications was made after a four-year administrative process and after exhaustive submission of surveys and information by Dudak.

The government ’ s decision in 2009 and 2010, when it accepted 5.17 litres per hour as the applicable fuel consumption rate of idling yellow school buses was a factual determination after due consideration of all the evidence over a lengthy period of time. [ 33 ] This is an appeal from that same administrative process. The Crown ’ s decision was made in the course of an administrative proceeding to set the fuel tax rebate for the applicants, including this Respondent.

The Crown ’ s decision was announced in respect of at least 14 applications for fuel tax rebate by operators of little yellow school buses, including some applications overlapping the time span under this Appeal and some applications by the Respondent for succeeding time spans. [ 34 ] This determination of the off-road idle rate is final in that it has not been appealed by the Respondent or the Crown. The issue of applicable idling rate has been determined as a result of these administrative proceedings and the doctrine of issue estoppel will prevent the parties from re-litigating the issue in this Appeal.

The application of the principle of estoppel as against a Minister of the Crown is well-recognized. [ 35 ] Issue estoppel is available to prevent a party from litigating in court what has already been litigated in earlier proceedings. As determined by the Supreme Court in Danyluk v. Ainsworth Technologies Inc., supra , and Angle v.

M.N.R., supra , it is available not only in criminal and civil proceedings, but also in the context of administrative proceedings, including those involving a Minister of the Crown. [ 36 ] A prerequisite for the application of issue estoppel is that the prior decision be a “ judicial decision ” . After that threshold issue is met, the first step is to determine whether the three preconditions for issue estoppel are met.

The second step is to determine as a matter of discretion whether issue estoppel ought to be applied. [ 37 ] As to the threshold issue, issue estoppel is available against a Minister of the Crown. [ 38 ] The legislative regime established by the Fuel Tax Act and applicable regulations mandates the Minister to act in a judicial manner.

By necessary implication, he must base his decisions on findings of fact and the application of an objective legal standard to those facts. [ 39 ] As to the first step of the test, the preconditions for issue estoppel are threefold, and have been met in the present case: a. the same question has been decided (idling rate of yellow school buses);

b. the judicial decision which is said to create the estoppel was final (it was not appealed); and c. the parties to the judicial decision or their privies were the same persons as the parties to the proceedings in which the estoppel is raised or their privies (the government and the Respondent). [ 40 ] The second part of the test is one of fairness and avoiding injustice. Fairness mandates the application of issue estoppel to the circumstances of this case.

It would be unfair to allow the government to resile from its determination of the fuel consumption rate for idling yellow school buses made in the Other Objections. A rate higher than that set out in the Other Objections would be unfair to the Other Applicants.

A rate lower than that set out in the Other Objections would be unfair to the Respondent. [ 41 ] By determining the idling rate in the Other Applications, the government has therefore also determined the rate for this Appeal, and so was ‘ materially advancing ” this Appeal by resolving one of the matters in issue. [ 42 ] By virtue of the matters discussed above, and in particular issue estoppel, the decisions in the Other Objections is a “ barrier in law ” to the Court adjudicating otherwise than 5.17 litres per hour on the issue of the fuel consumption rate of idling yellow school buses in this Appeal. [ 43 ] I concluded that establishment of the applicable fuel consumption rate for idling yellow school buses by the government in the Other Objections in 2009 and 2010 constitutes a “ thing done ” that significantly advances this Appeal. [ 44 ] The Crown ’ s motion to dismiss this Appeal for long delay is denied.

Heard on the 10 th day of July, 2012. Dated at the City of Edmonton, Alberta this 12 th day of July, 2012. Donald Lee J.C.Q.B.A. Appearances: Shelley J. MacDonald Alberta Justice for the Applicant Daniel P. Carroll, Q.C.

Field LLP for the Respondent