R. v. McCartie Date:, 2012 BCPC 510

Citation: R. v. McCartie Date: 20121113 2012 BCPC 0510 File No: 74283-1 Registry: Nanaimo IN THE PROVINCIAL COURT OF BRITISH COLUMBIA REGINA v. COLIN GARY McCARTIE ANNIE McCARTIE RULING RE DEFENDANTS’ PRE-TRIAL APPLICATIONS OF THE HONOURABLE JUDGE J.P. MacCARTHY Crown Counsel: R. Gibson Appearing on his own behalf: C. McCartie

Appearing on her own behalf: A. McCartie Place of Hearing: Nanaimo, B.C. Date of Judgment: November 13, 2012 [ 1 ] THE COURT (orally): Colin Gary McCartie and Anni e McCartie are before this court on Information 74283-1, which contains 10 counts. [ 2 ] Colin McCartie is named in six of the counts. Four of the counts, being Counts 1 through 4 inclusive, are charges for false reporting under s. 239(1) (

a) of the Income Tax Act , R.S.C. 1985, c. 1 (5th Supp.) (" ITA "), for a number of taxation years. One count, being Count 5, is a charge of evasion under s. 239(1)(

d) of the Income Tax Act . One count, being Count 6, is a charge of evasion under s. 327(1) (

c) of the Excise Tax Act , R.S.C. 1985, c. E-15 (" ETA "). [ 3 ] Annie McCartie is named in four of the counts, being Counts 7 through 10 inclusive. Three of the counts, being Counts 7 through 9 inclusive, allege false reporting under s. 239(1) (

a) of the ITA for a number of taxation years. One count, being Count 10, is a charge of evasion under s. 239(1)(

a) of the ITA . [ 4 ] Colin and Annie McCartie are self-represented. They have brought on a number of applications before me. I have been assigned to deal with pre-trial management of this case, and in particular with pre-trial applications that may arise.

At this point, I have not been assigned to be the trial judge of this case, nor at this point am I seized to hear the trial. [ 5 ] The Application Notice Number 2 filed October 12, 2012, is entitled, "Application To Dismiss Charges, Counts 1-5 & 7-10". [ 6 ] The application states the grounds on which the application is brought before this court as follows, and I quote: 1. There is an arguable issue as to the taxability of the alleged amounts. It is not the task of the criminal court to determine civil liability or to resolve ambiguities in tax jurisprudence or legislation.

The criminal court usurps its function and appropriates itself of a jurisdiction, which it does not possess, in attempting to determine whether a taxpayer is susceptible to taxation or not. If there is an arguable issue in regard to the question of taxability, there can be no finding of criminal responsibility. 2. No offences have been committed contrary to sections 239(1) (

a) and 239(1)(

d) of the Income Tax Act ("ITA") and section 327(1) (

c) of the Excise Tax Act ("ETA"), because as a matter of law, the amounts received during the years in question were not from a source of income that is subject to taxation for purposes of the ITA and/or ETA. [ 7 ] In support of this application, the applicants have filed the following: 1. the Notice of Application filed October 12, 2012; 2. the Affidavit of Colin McCartie designated number 7, containing Exhibits A to D inclusive; 3. the Affidavit of Annie McCartie, designated number 9, containing Exhibits A through C inclusive; 4. the applicants' memorandum consisting of 29 pages; and 5. the list of several authorities upon which the applicants rely. [ 8 ] In the applicants' memorandum in support of the application to dismiss, there appears a heading "Overview".

Paragraphs 1 and 2 are a

summary of the position taken with respect to this application, and I quote: 1. This application is a challenge of the Provincial Court's jurisdiction to adjudicate the matter of taxability, a subject that is properly within the exclusive original jurisdiction of the Tax Court of Canada. 2. This application will show that the taxability of the amounts received is not clear-cut, obvious, undisputable, or unquestionable. Criminal courts have been held to an exacting standard in regards to taxability and it is not the function of the criminal courts to weigh whether a taxpayer is susceptible to taxation or not.

In order to have "taxable income", there must first be a "source of income" and it is precisely these two matters that will form the basis of the arguable issue of taxability. [ 9 ] The next application that is before me is entitled "Notice #3 - Application to Dismiss GST Charge", that is brought by the

applicant Colin McCartie. [ 10 ] In the Notice #3, the grounds for dismissal of Count 6 of the Information are stated as follows, I quote: 1. The applicant was not engaged in a commercial activity, as defined in the ETA . 2. The applicant had no reasonable expectation of profit from his activities. 3. The applicant was not a GST registrant during the years at issue. 4. The applicant was not required to be registered for GST during those years. 5. The applicant did not collect GST during the years at issue. 6. The applicant was not required to collect GST for his activities. 7.

The last company that collected and remitted GST paid it in full. 8. Canada Revenue Agency ("CRA") is collecting the GST twice. 9. CRA's assessment and collection actions in this case are a fraud and a conspiracy to injure the applicant because of a bias held toward the applicant. [ 11 ] In support of this application, the applicants have filed the following: 1. Notice of Application filed October 12, 2012; 2.

Affidavit of Colin McCartie, designated number 8, containing Exhibits A through J inclusive; 3. the applicants' memorandum consisting of 15 pages; 4. a list of authorities; 5. a Notice of Constitutional Question; and 6. a GST Flowchart, Parts A and B. [ 12 ] The Notice of Constitutional Question that has been filed raises the following question, found at page 3 under the heading, "The following is the legal basis for the constitutional question:" and then: 7.

The applicant is seeking an answer to a question of law, about the constitutional validity, applicability or operability of the Excise Tax Act ("ETA") to deem an individual a GST registrant, even though they are not required to be, and enforce collection actions against the individual before they have had a fair hearing for the determination of their rights and obligations. This practice by CRA lacks fundamental justice and violates the individual's rights under

section 7 of the Charter of Rights and Freedoms ("the Charter") and sections 1(

a) and 2(

e) of the Canadian Bill of Rights ("the Bill"). [ 13 ] The applicants' memorandum in support of the Application #3 to dismiss Count 6, being the GST charges, further identifies the constitutional issues being raised by the applicant as follows, referring to page 2, paragraph 6, I quote: 6. This application also raises three constitutional questions which are detailed in the Notice of Constitutional Question filed within this application.

First, it raises the question of whether or not the minister can compel the applicant into a binding contract of trusteeship without pecuniary consideration where he has not made an application to register for GST and before he has been afforded a hearing for the determination of his rights and obligations as to whether or not he is required to be registered for GST and to collect and remit the tax? 7.

Second, it raises the question of whether or not the applicant can be compelled into a binding contract of trusteeship without consideration and which places him in a position of involuntary servitude when he is not engaged in a commercial activity? 8. Third, it asks whether or not this compulsion is a breach of the applicant's constitutionally protected liberty and property rights as secured by

section 1(

a) and 2(

e) of the Canadian Bill of Rights ("Bill"), sections 7 and 26 of the Canadian Charter of Rights and Freedoms ("Charter"), and section 52(1) of the Constitutional Act, 1982, whereby the penalties for non-compliance and non-performance of the fiduciary responsibility of a trustee under the ETA , including incarceration and deprivation of his property without due process of law? [ 14 ] Most noteworthy, under paragraph number 1 of the overview, the applicant on page 1 of 15 states as follows:

1. This application is a challenge of the Provincial Court's jurisdiction to adjudicate an arguable issue of GST liability and taxability, an issue that is properly within the exclusive original jurisdiction of the Tax Court of Canada. [ 15 ] I understand the accused's position is that while this court has the jurisdiction to dismiss the charges and to deal with constitutional and Charter issues relating to the charges, this court should, in a preliminary motion, dismiss all charges against the accused on the basis:

a) taxability is an essential element of the offence as charged;

b) the Tax Court of Canada enjoys exclusive jurisdiction to hear and determine issues between a taxpayer and CRA where there is disputed liability; and

c) the Provincial Court of British Columbia has no jurisdiction to deal with the charges set out in the information until the issue is resolved, pursuant to the applicants' pending civil/ administrative applications under the ITA and the ETA have been decided. [ 16 ] At the outset of the hearing of the applications, I expressed two concerns.

First of all, I requested that the parties address the more narrow preliminary issue, which I understand really is before me: whether the jurisdiction issue has already been dealt with in the decision of the Honourable Chief Justice Bauman of our Supreme Court of British Columbia in his decision cited as R. v.

McCartie , 2012 BCSC 928 , which was heard on March 20, 2012, and the Chief Justice's judgment was rendered on June 25, 2012. [ 17 ] Secondly, whether the relief being sought by the applicant, in terms of the various applications before me, was premature in nature, insofar as it should actually be dealt with during the trial of the charges against the applicants.

The Applicants' Position [ 18 ] On the first question as to whether or not the matter has already been dealt with by Chief Justice Bauman, I understand the position put forward by the applicants is that they say that there is a difference between what they seek from me in this court and what was being sought from the Supreme Court of British Columbia. In the first instance, what was being sought from the Supreme Court was an extraordinary remedy in the nature of an order of certiorari to quash the information.

What I am told they are seeking from me is what is described as an "ordinary remedy", which I understand to be a dismissal of the charges at a preliminary stage. [ 19 ] I am told that the second position being put forward by the defendants is that the ETA argument was not before Chief Justice Bauman in his reasons for judgment.

By that, I take it that the jurisdictional issue was not one that he had dealt with in his reasons for judgment. [ 20 ] The third leg of the arguments being put forward by the applicants essentially is that this court should be and can deal with the charges on the basis of the affidavit materials filed by the applicants. [ 21 ] This proposition is based on the argument that I am obliged to examine the test set out in R. v.

Redpath Industries Ltd. , reported at (1984), 84 D.T.C. 6349 . [ 22 ] The test in Redpath was summarized in the Nusch decision, which is at the Court of Appeal of Saskatchewan, cited as Nusch v. Her Majesty , 1998 Saskatchewan Court of Appeal, Docket 7283. That test is set out in Redpath at page 6351, as follows: A criminal court is not the forum to determine income taxability and to make determinations as to rights to tax assessment or absence of rights of assessment involved.

In a tax evasion charge, it must appear prima facie from the evidence that the taxability is clear-cut, obvious, indisputable, unquestionable from lack of reporting, before entering the examination of the other facts of the charge, e.g. whether the undisputable taxability, based on income gained, proven and undeclared, leads to a conclusion beyond a reasonable doubt that it was wilfully omitted by a taxpayer in his tax returns. The Crown’s Position [ 23 ] Crown's position with respect to the adjudication of these issues in Chief Justice Bauman's decision of R. v.

McCartie is that essentially the decision of Chief Justice Bauman relates to the same information that is before this court. It is argued by Crown that Chief Justice Bauman disposed of essentially the same argument by finding it to be premature on the basis that there must first be an evidentiary record, in order to determine whether the amounts at issue are "clear-cut" and "obvious". [ 24 ] The Crown goes on to argue that Chief Justice Bauman adopted the comments from R. v. Lawson and Dang-Lawson , 2012 BCSC 356 .

That case dealt with various objections, including the jurisdiction issue, and the decision in that case found in favour of the Crown. [ 25 ] The Crown's next submission to me is that in their view the present application is, as it was in the matter before Chief Justice Bauman, premature as there is no proper evidentiary basis upon which the court can determine whether the amounts at issue are taxable income. [ 26 ] Crown further states that it is for Crown to prove beyond a reasonable doubt at trial that the amounts at issue are taxable income.

That trial has, as Crown has indicated, clearly not yet occurred, and it is Crown's further argument that any attempt to create the necessary evidentiary record at a pre-trial application would be entirely duplicative of the trial itself. [ 27 ] Crown further argues that with respect to the issue to dismiss the charges at this stage, that it will be open to the applicants at

trial to argue that the taxability of the amounts at issue is not so "clear-cut" and that therefore the actus reus or mens rea of the offence is unproven. They summarize their position in this regard to say that such will be the question to be determined at trial. [ 28 ] With respect to the GST issue of jurisdiction, again Crown says that this issue was dealt with by Chief Justice Bauman in his decision in R. v. McCartie , and also with reference that the Chief Justice made to the decision which he referred to, being that of the Honourable Mr. Justice Myers in R. v.

Keith David Lawson and May Dang-Lawson , cited as R. v. Lawson , 2012 BCSC 356 . In other words, the same issue as to the jurisdiction of the Provincial Court to deal with that issue has already been determined by Chief Justice Bauman. [ 29 ] The position that is advanced, again with respect to the GST charges, is similar in nature to that advanced with respect to the income tax charges; essentially that there must be a proper evidentiary basis upon which the court can determine as to whether or not the offence of evasion of taxes under the Excise Tax Act has been proven.

In other words, it is through a trial process that there will be a proper evidentiary basis upon which the court can make that determination, and to determine the numerous arguments that have been raised by Colin McCartie with respect to the applicability of the Excise Tax Act to him. [ 30 ] Accordingly, with respect to the GST issue, Crown submits that the application of the applicant should be dismissed. With respect to the jurisdictional and taxability issue and to the extent that the application is relevant to the criminal charges, that the applicant should be free to make such arguments at the trial proper.

The Decision in R. v. McCartie [ 31 ] In his case of R. v. McCartie , the Chief Justice had before him a series of applications. Those applications were brought forward before Chief Justice Bauman to obtain an order in the nature of certiorari to quash the Information. [ 32 ] At paragraph 4 of his reasons, the Chief Justice sets out the following information with respect to the grounds advanced by the applicants in order to obtain the relief that was being sought by the applicants.

Paragraph 4 reads as follows, and I quote: In seeking this relief, the applicants advance a number of diverse grounds, but I can summarize them so: (

i) the Provincial Court of British Columbia does not have jurisdiction to decide the "taxability" of the amounts alleged and the applicants vigorously dispute that issue; (ii) it is an abuse of process and contrary to the applicants' rights under the Charter and the Canadian Bill of Rights when, as here, the applicants have not been permitted to exhaust their civil/administrative remedies under the applicable legislation; processes which they have invoked; (iii) the information was improperly obtained; (iv) the applicants had a legitimate expectation that they would have a right to procedural fairness before criminal proceedings were commenced; and (

v) fingerprinting the applicants before conviction is not necessary and is in breach of their Charter rights and contrary to the Canadian Bill of Rights . [ 33 ] The Chief Justice dealt with each of the applicants' arguments and the applications. The applications were dismissed. [ 34 ] Under

Part II of his reasons for judgment, the Chief Justice dealt with the jurisdiction/taxability argument. That particular argument and his decision is the most relevant to the proceedings before me.

Paragraph 6 of the reasons for judgment and the succeeding paragraphs through to paragraph 13 read as follows, and I quote: [6] The substance of this argument proceeds: "taxability" is an essential element of the offences charged; the Tax Court of Canada enjoys exclusive jurisdiction to hear and determine issues of disputed taxability; until that issue is resolved pursuant to the applicants' pending civil/administrative applications under the ITA and the ETA , the Provincial Court of British Columbia has no jurisdiction to entertain the information. [7] The applicants rely on the decision of the Quebec Superior Court in The Queen v.

Redpath Industries Ltd. et al. (1984), 84 D.T.C. 6349 (QCCS Crim. Div.) . Briefly, the respondents in that case were engaged in a complicated business structure to achieve tax savings. They were charged with wilfully evading the payment of tax on certain profits. The companies were acquitted by the trial judge on the basis that the Crown failed to prove the existence of a sham or scheme to evade taxes. The Crown's appeal to the Quebec Superior Court was dismissed.

The Quebec Superior Court held that there must be prima facie evidence that the tax was indisputably payable before it could decide if tax had been evaded. [8] I note that the companies were charged with evasion under s. 239(1) (

d) of the ITA "by omitting to declare in their income tax returns taxable income...". In that context, Justice Bergeron said this (at 6350-51): The main thrust of the Act is to compel the taxpayer to declare his income, no matter what the source may be, and the taxpayer has no choice but to declare it as faithfully as his activities engendered. In doing so, he is entitled to take into account whatever exemptions are recognized by the Act and he may claim the benefit of such exemptions in his tax return.

The Revenue, upon such disclosure, may not agree with the taxpayer's exemptions claim and may move to reject such claim by notice ofassessment, opening the door to legal civil proceedings to be decided on the merit of the respective contentions of the parties, by theAppeal Board and the Exchequer Court (for the years involved), later on by the Tax Appeal Board (now the Tax Court of Canada) andthe Federal Court. These authorities constitute the forum where adverse contentions are debated as to taxability or not.

The obligation to declare his revenue on the part of the taxpayer is unquestionable and wilfull failure to do so may entail the commissionof an offence of evading compliance with the Act, which is not to be confused with an avoidance of tax. The case law is replete with prosecution for failure to declare, but it is worth noting that in regard to a charge of tax evasion, not a singlereported case could be found based on wilfull omission to declare income such as in the present case where the total income is declared,and declared as non-taxable by virtue of exemption simultaneously claimed in tax returns. . . .

We have to deal here with a specific charge of 'failure to declare' and not with the manner in which an exemption was claimed in taxreturns, since it is clear from the record that a true and exact income was admittedly reported. A criminal court is not the forum to determine income taxability and to make determinations as to rights to tax assessment or absence ofrights of assessment involved.

In a tax evasion charge, it must appear prima facie from the evidence that the taxability is clear-cut,obvious, indisputable, unquestionable from lack of reporting, before entering the examination of the other facts of the charge, e.g.whether the undisputable taxability, based on income gained proven and undeclared, leads to a conclusion beyond a reasonable doubt thatit was wilfully omitted by a taxpayer in his tax returns.

If such basis is not present and there exists an obligation to enter into the examination of the merit of a possible assessment in respect of adeclared income in order to weigh whether a taxpayer is susceptible to taxation or not, may or may not take advantage of claimedexemptions a criminal court usurps its function and appropriates itself of a jurisdiction which it does not possess.

We are faced in this instance, with a strict problem of taxability, originating from the creation of an affiliated company, a foreign offshorecorporation, a device widely used over more than the last half century by numerous large and multinational corporations, to conductsome of their international commercial operations and as a means of recuperating tax-free dividends, due to a certain elasticity, if not tosay laxity, in the Canadian legislation as it then existed.

The case law abounds with instances where, in taxation matters, the Revenue Department has constantly frowned upon the practice and,not seeing eye to eye with the taxpayer's exemption claims, has on multiple occasions set the civil machinery in motion to contest thevalidity of the exemption claim pursuant to a declaration so qualified by the taxpayer; in all such cases, always introduced in civiljurisdictions, the Revenue has often relied on the theory of 'sham', an artifice to camouflage the true nature of a taxpayer's operationsthrough a corporate dummy or puppet.

But never, as well as I could ascertain, has a criminal prosecution been instigated, based on a totally declared income couched in returnsduly filed as required by law but qualified by direct and unequivocal indications of the source and nature of the income, and thedispositions of the law on which the taxpayer relies to claim tax exemption.

If the true income has been declared, what opposite views the parties may adopt as to their respective merit, should not be the concern ofa criminal court, but that of civil tribunals, and the matter could end right there as far as an information for 'failure to disclose' isconcerned. [9] The applicants also rely on the Saskatchewan Court of Appeal’s decision in Nusch v. The Queen (1998), (SKCA), 168 Sask. R. 193 (CA), which applied Redpath Industries Ltd. in the context of charges under ss. 239(1)(

a) and (

d) of the ITA. [10] The problem with the applicants' submission, however, is that it is premature. I underline that Redpath Industries Ltd. holds that: In a tax evasion charge it must appear prima facie from the evidence that the taxability is clear-cut, obvious, indisputable... [emphasis added] [11] I agree with the essence of the Crown’s submission at para. 22 of its argument: [22] To determine at a pre-trial application whether taxability in a tax evasion charge is of such a clear nature based on the supportingevidence places the "cart before the horse".

There must first be evidence adduced during the trial for a court to make such adetermination. The Applicants are inviting the Court to make such a finding in a factual vacuum. The Redpath decision does notanywhere indicate that tax evasion charges should proceed in the Tax Court. Nowhere does the decision say that the provincial-levelcourts are without jurisdiction to try a criminal tax evasion case. Rather, the decision stands for the proposition that civil taxationquestions should not be adjudicated in the criminal process.

[12] A similar view was taken by Justice Myers in R. v. Lawson , 2012 BCSC 356 , where the taxpayers similarly brought application to quash tax evasion charges. They, too, raised the taxability/ jurisdiction argument. Justice Myers rejected that submission as premature (at para. 20): [20] I do not agree that the Crown is obliged to seek a remedy in tax court rather than launch a prosecution for tax evasion. There have been several cases in which the Crown has obtained convictions for tax evasion and failure to remit GST. While Mr.

Lawson cited cases in which the courts have acquitted on charges of tax evasion and remarked in their decisions that the Crown should have pursued the matter in tax court as a collection matter; that is, a decision that is made at a trial or preliminary inquiry. It is not for this Court to pre- determine that issue by way of a motion for a prerogative remedy. [13] In my view, that disposes of this aspect of the applicants' argument. [ 35 ] Under

Part II, heading (ii), in R. v. McCartie , Chief Justice Bauman deals with what is referred to as "The Abuse of Process Argument". In that portion of his reasons for judgment, the Chief Justice makes reference to s. 239(4) of the Income Tax Act .

It provides as follows, and I quote: Where, in any appeal under this Act, substantially the same facts are at issue as those that are at issue in a prosecution under this section, the Minister may file a stay of proceedings with the Tax Court of Canada and thereupon the proceedings before that Court are stayed pending final determination of the outcome of the prosecution. [ 36 ] In paragraph 18 of his reasons for judgment, Chief Justice Bauman points out that the ETA contains a similar provision. [ 37 ] As a result of his analysis contained under the heading of "Abuse of Process Argument", the Chief Justice concludes that it is possible that there can be parallel proceedings proceeding, and that the Crown is at liberty to pursue income tax evasion charges, and hence the operation of s. 239(4) of the Income Tax Act operates to stay the proceedings within the Tax Court of Canada. [ 38 ] In dealing with the abuse of process argument, Chief Justice Bauman deals at paragraph 20 of his decision with respect to the applicants' argument that proceeding criminally amounts to an abuse of process and a violation of rights under s. 7, s. 24(1), and/or ss. 1(

a) and 2(

e) of the Canadian Bill of Rights when applicants are exercising their right to due process. He states as follows: I cannot credit this submission. In the criminal proceeding, the applicants will have a complete opportunity to make full answer and defence and to specifically argue, as in Redpath Industries Ltd. , that the Crown has not demonstrated taxability to be clear-cut, obvious and indisputable. Analysis [ 39 ] As I understand the decision of Chief Justice Bauman, what the applicants were seeking from him, which was denied, was the extraordinary remedy of certiorari .

The result of the granting of that order would have been to quash the information, based on the jurisdiction of the Provincial Court to deal with the tax evasion charges. [ 40 ] What I understand the applicants are seeking to do before me is essentially to obtain a remedy that all of the charges should be dismissed, and to defer to the jurisdiction of the Tax Court. Essentially what the applicants are seeking is the same result denied by Chief Justice Bauman. [ 41 ] Based on the decision of Chief Justice Bauman in R. v.

McCartie , I am satisfied that the application of the applicants for dismissal of the charges, based on the lack of jurisdiction of this court to deal with the charges which are set out in the information, must fail. [ 42 ] The arguments that they are raising with respect to jurisdiction have been dealt with by the Honourable Chief Justice in his reasons on the certiorari application.

I see no new arguments being raised which would permit me to come to a contrary conclusion. [ 43 ] Whether it is an extraordinary remedy being sought by the applicants from the Supreme Court or whether it is what they described as an "ordinary remedy" to dismiss the charges against them, there must still be a basis for that remedy. That basis has not been established by the applicants; the case law and the decision of the Chief Justice in R. v.

McCartie are binding upon me in that regard. [ 44 ] With respect to the second issue that I am dealing with: as to whether or not the applications for the other relief being sought by the applicants are premature. I wish to note that what essentially the applicants are seeking to do is to have all charges against them disposed by way of a

summary trial, based on the affidavit evidence that they have filed. Crown has not, however, filed any responding affidavits with respect to the evidence that I expect that they will be adducing at trial in order to deal with the various charges that have been laid against the applicants, nor would I have necessarily expected them to do so. [ 45 ] The affidavits filed by the applicants do serve as a foundation for the defence that they intend to raise with respect to the various charges.

However, those affidavits are not determinative of whether or not the Crown can discharge the burden of proof upon them; that is, to prove the charges against the applicants beyond a reasonable doubt. [ 46 ] The earliest that it will be known as to whether or not the Crown has satisfied that burden is most likely at the time that the Crown closes its case. [ 47 ] The cases that the accused has relied upon, such as Redpath and Nusch , are clearly cases where a trial judge has heard the

evidence and has ruled and adjudicated upon the evidence that the Crown had put forward. As Crown has clearly pointed out, at this point in the case before me, the matter has not proceeded to trial. The decisions in Redpath and Nusch are obviously decisions that were not decided on the basis of

summary applications put forward by way of affidavit. [ 48 ] I agree with the Crown's position that there must be foundational evidence which will come before the trial judge through the trial process, before an application for dismissal of the charges can be entertained. [ 49 ] Similarly, I am of the view that the Charter arguments that have been advanced by the applicant will require the same sort of foundational evidence which will be likely forthcoming through the trial process. [ 50 ] The trial judge will be in the best position to deal with the arguments that have been raised by the applicants with respect to the various Charter and the constitutional issues that have been raised.

At this point, those applications are premature. [ 51 ] I did not invite submissions from the applicants on the other applications that they have brought forward, specifically as part of the Application Number 3. I have no intention to prejudge the merit or the potential success of those applications. The trial judge will be in the best position to deal with those applications, having heard the evidence, or alternatively to rule on whether or not the application has any prospect of success.

Conclusion [ 52 ] Accordingly, my conclusion is that the applicants' applications to have all charges dismissed are to be rejected and are therefore dismissed.

It will be open to the applicants to argue at the trial about the taxability of the amounts at issue, and of course whether or not Crown has proven the actus reus or the mens rea of the alleged offences. [ 53 ] It will also be open to the applicants to argue the GST issues raised in their application at the trial, and those would include issues relating to commercial activity, excise tax obligations, Charter arguments, and constitutional questions, and the issues of cost. [ 54 ] In essence, the applications brought with respect to the GST charges are premature at this time. [ 55 ] That concludes my reasons for judgment with respect to the applications that are before me and with respect to the other applications that have been brought by the applicants. (REASONS CONCLUDED)