2020 FC, 2020 FC 1137

Date: 20201209 Docket: T-1439-18 T-1440-18 T-1451-18 T-1452-18 T-1501-18 Citation: 2020 FC 1137 Ottawa, Ontario, December 9, 2020 PRESENT: The Honourable Mr. Justice Southcott BETWEEN: T-1439-18 NADER GHERMEZIAN Applicant and ATTORNEY GENERAL OF CANADA Respondent AND BETWEEN: T-1440-18 MARC VATURI and ATTORNEY GENERAL OF CANADA AND BETWEEN: T-1451-18 NADER GHERMEZIAN and ATTORNEY GENERAL OF CANADA AND BETWEEN: T-1452-18 MARC VATURI and ATTORNEY GENERAL OF CANADA AND BETWEEN: T-1501-18 GHERFAM EQUITIES INC and ATTORNEY GENERAL OF CANADA JUDGMENT AND REASONS I.

Overview [ 1 ] This decision relates to five applications for judicial review of Requirements for Information [RFIs] issued by John Harasymchuk, a delegate of the Minister of National Revenue [the Minister ] under s 231.2(1) of the Income Tax Act , RSC 1985, c 1 (5th Supp ) [ ITA ]. [ 2 ] The Applicants are two individuals, Nader Ghermezian and Marc Vaturi, and a corporation, Gherfam Equities Inc. [Gherfam]. Mr. Ghermezian is the Applicant in two of these matters (Court file numbers T-1439-18 and T-1451-18), Mr.

Vaturi is the Applicant in two of these matters (Court file numbers T-1440-18 and T-1452-18), and Gherfam is the Applicant in the fifth matter (Court file number T- 1501-18). Each of the five RFIs under review required the applicable Applicant to produce certain information for purposes described as related to the administration and enforcement of the ITA . [ 3 ] These five applications for judicial review were heard together, by videoconference employing the Zoom platform, on November 12 and 13, 2020.

As they raise common issues, these Reasons addresses all five applications. [ 4 ] As explained in greater detail below, the applications in Court file numbers T-1439-18, T-1440-18, T-1451-18 and T-1452-18 are dismissed, because I find the decisions to issue the RFIs under review in those applications to be reasonable.

The application in Court file number T-1501-18 is allowed, and the RFI under review in that application is quashed, because I find that RFI unreasonable, in that a particular paragraph of that RFI is not sufficiently precise for the Applicant to understand what information and documentation it is required to provide in response. II. Background [ 5 ] The RFIs under review in T-1439-18 and T-1440-18, both dated June 27, 2018, are the same, other than the persons to whom they

are addressed, as the RFI in T-1439-18 was issued to Mr. Ghermezian and the RFI in T-1440-18 was issued to Mr. Vaturi. As explained in the Respondent’s Memorandum of Fact and Law, these RFIs request production of information and documents relating to certain corporations listed in the RFIs (which the Respondent refers to as the Triple Five Corporations), in particular banking information and documents relating to those corporations including a list of bank accounts, bank statements, and details concerning incoming and outgoing funds transfers.

In these Reasons, I will refer to these two RFIs as the " “Triple Five RFIs.” " [ 6 ] The RFIs under review in Court file numbers T-1451-18 and T-1452-18, both dated June 28, 2018, are also the same, other than the persons to whom they are addressed, as the RFI in T-1451-18 was issued to Mr. Ghermezian and the RFI in T-1452-18 was issued to Mr. Vaturi. These RFIs request production of information and documents relating to certain foreign corporations that are listed in the RFIs, subsidiaries of such corporations and any other entities owned by the Ghermezian Family Trust.

In particular, the RFIs request particular corporate records and bank statements related to these corporations. The corporations listed in the RFIs are described as managed by Mr. Ghermezian and Mr. Vaturi and registered in Gibraltar. In these Reasons, I will refer to these two RFIs as the " “Gibraltar RFIs.” " [ 7 ] The RFIs under review in Court file number T-1501-18 was issued to Gherfam on July 10, 2018 [the Gherfam RFI].

It requests production of information and documents relating to a restructuring and refinancing transaction related to the Mall of America that occurred in 2014, as well as information and documents relating a company named Triple Five of Minnesota, Inc. [T5MN], including the historical asset holdings of that company and related entities and that company’s financial statements. [ 8 ] The parties to these applications have not filed affidavit evidence in support of their respective positions.

Rather, the evidentiary record before the Court consists of the Certified Tribunal Record [CTR] that has been filed in each matter. The original CTR applicable to Court file numbers T-1439-18, T-1440-18, T-1451-18 and T-1452-18 was filed August 16, 2018 and consists of: (

a) the RFIs under review in those four matters; (

b) a document entitled " “Information Sheet for a Requirement to Provide Information” " applicable to those four RFIs [the Ghermezian and Vaturi Information Sheet]; and (

c) drafts of the four RFIs. The Ghermezian and Vaturi Information Sheet contains a number of redactions, described as being made pursuant to ss 37 and 38 of the Canada Evidence Act . The record also includes a revised version of the CTR, filed November 23, 2018, which includes the Ghermezian and Vaturi Information Sheet with fewer redactions. [ 9 ] The CTR applicable to Court file number T-1501-18 was filed August 27, 2018 and consists of: (

a) the RFI under review in that matter; (

b) a document entitled " “Information Sheet for a Requirement to Provide Information” " applicable to that RFI and to an RFI under s 231.6(2) of the ITA [the Gherfam Information Sheet]; (

c) drafts of those RFIs; and (

d) an Audit Information Request that had previously been issued to Gherfam. III. Issues [ 10 ] The Applicant in each of the five applications for judicial review raises the following three issues: A . Whether the RFI is invalid because the Minister failed to obtain the judicial authorization required under s 231.2(2) of the ITA for an unnamed persons requirement; and B . Whether the RFI is invalid because the Minister failed to comply with the criteria in s 231.6 of the ITA for foreign-based information; and C .

Whether the RFI is invalid because it was not issued for purposes related to the administration or enforcement of the ITA . [ 11 ] The Respondent raises the following additional issues: A . The applicable standard of review; B . Which party bears the applicable burden of proof; and C . Whether the relief sought by the Applicants is appropriate in the circumstances. [ 12 ] I consider the combination of issues raised by the parties, starting with the standard of review and then the burden of proof, to represent a suitable framework for the adjudication of the parties’ arguments in these applications. IV.

Analysis A. The applicable standard of review [ 13 ] The parties agree that the reasonableness standard of review applies to the issues under consideration in these applications.

It is useful to canvass some of the principles explained by the Supreme Court of Canada in Canada (Minister of Citizenship and Immigration) v Vavilov , 2019 SCC 65 [ Vavilov ] as governing the conduct of reasonableness review of administrative decisions. [ 14 ] As a starting point, Vavilov explains that the reasonableness standard of review contemplates deference to administrative decision- makers (at paras 75 and 83): 75 Our colleagues emphasize that reviewing courts should respect administrative decision makers and their specialized expertise, should not ask how they themselves would have resolved an issue and should focus on whether the applicant has demonstrated that the decision is unreasonable: paras. 288, 289 and 291.

We agree. As we have stated above, at para. 13, reasonableness review finds its starting point in judicial restraint and respects the distinct role of administrative decision

makers. Moreover, as explained below, reasonableness review considers all relevant circumstances in order to determine whether the applicant has met their onus. …. 83 It follows that the focus of reasonableness review must be on the decision actually made by the decision maker, including both the decision maker’s reasoning process and the outcome. The role of courts in these circumstances is to review , and they are, at least as a general rule, to refrain from deciding the issue themselves.

Accordingly, a court applying the reasonableness standard does not ask what decision it would have made in place of that of the administrative decision maker, attempt to ascertain the “range” of possible conclusions that would have been open to the decision maker, conduct a de novo analysis or seek to determine the “correct” solution to the problem. The Federal Court of Appeal noted in Delios v.

Canada (Attorney General) , 2015 FCA 117 , 472 N.R. 171 (F.C.A.) , that, “as reviewing judges, we do not make our own yardstick and then use that yardstick to measure what the administrator did”: at para. 28; see also Ryan , at paras. 50-51.

Instead, the reviewing court must consider only whether the decision made by the administrative decision maker — including both the rationale for the decision and the outcome to which it led — was unreasonable. [ 15 ] Where the administrative decision-maker has produced written reasons for the decision under review, the Court should begin its review with focus upon those reasons (see Vavilov at para 84 ).

This focus considers not only the outcome of the decision but also whether that outcome is justified by the reasoning process employed by the decision-maker (see Vavilov at paras 86-87 ). [ 16 ] For circumstances where the nature of the decision or decision-making process does not involve the production of formal reasons, Vavilov provides the following guidance (at paras 137-138): 137 Admittedly, applying an approach to judicial review that prioritizes the decision maker’s justification for its decisions can be challenging in cases in which formal reasons have not been provided.

This will often occur where the decision- making process does not easily lend itself to producing a single set of reasons, for example, where a municipality passes a bylaw or a law society renders a decision by holding a vote: see, e.g., Catalyst; Green; Trinity Western University . However, even in such circumstances, the reasoning process that underlies the decision will not usually be opaque. It is important to recall that a reviewing court must look to the record as a whole to understand the decision, and that in doing so, the court will often uncover a clear rationale for the decision: Baker , at para. 44.

For example, as McLachlin C.J. noted in Catalyst , “[t]he reasons for a municipal bylaw are traditionally deduced from the debate, deliberations, and the statements of policy that give rise to the bylaw”: para. 29. In that case, not only were “the reasons [in the sense of rationale] for the bylaw . . . clear to everyone”, they had also been laid out in a five-year plan: para. 33.

Conversely, even without reasons, it is possible for the record and the context to reveal that a decision was made on the basis of an improper motive or for another impermissible reason, as, for example, in Roncarelli . 138 There will nonetheless be situations in which no reasons have been provided and neither the record nor the larger context sheds light on the basis for the decision. In such a case, the reviewing court must still examine the decision in light of the relevant constraints on the decision maker in order to determine whether the decision is reasonable.

But it is perhaps inevitable that without reasons, the analysis will then focus on the outcome rather than on the decision maker’s reasoning process. This does not mean that reasonableness review is less robust in such circumstances, only that it takes a different shape. [ 17 ] The issues in the present applications raise, at least in part, disputes between the parties surrounding

interpretation of certain provisions of the ITA . Vavilov emphasizes the application of the reasonableness standard of review to matters of statutory

interpretation and how that standard should be applied (at paras 115-116). 115 Matters of statutory

interpretation are not treated uniquely and, as with other questions of law, may be evaluated on a reasonableness standard. Although the general approach to reasonableness review described above applies in such cases, we recognize that it is necessary to provide additional guidance to reviewing courts on this point. This is because reviewing courts are accustomed to resolving questions of statutory

interpretation in a context in which the issue is before them at first instance or on appeal, and where they are expected to perform their own independent analysis and come to their own conclusions. 116 Reasonableness review functions differently. Where reasonableness is the applicable standard on a question of statutory

interpretation, the reviewing court does not undertake a de novo analysis of the question or “ask itself what the correct decision would have been”: Ryan , at para. 50.

Instead, just as it does when applying the reasonableness standard in reviewing questions of fact, discretion or policy, the court must examine the administrative decision as a whole, including the reasons provided by the decision maker and the outcome that was reached. [ 18 ] The administrative decision maker’s task is to interpret the statutory provision in a manner consistent with the text, context and purpose, applying its particular insight into the statutory scheme at issue (see Vavilov at para 121 ).

However, as with other aspects of administrative decision-making, there may be cases in which the administrative decision maker has not explicitly considered the meaning of a relevant provision in its reasons. The reviewing court should then consider whether it is able to discern the

interpretation adopted by the decision-maker from the record and determine whether that

interpretation is reasonable (see Vavilov at para 123 ). [ 19 ] I will return to these principles later in these Reasons. B. Which party bears the applicable burden of proof [ 20 ] The Applicants take the position that the Minister bears the burden of proving compliance with s 231.2 of the ITA . They note that the Minister has not filed any affidavit evidence in these applications for judicial review and argue that the Court should draw an adverse inference on that basis, as the facts surrounding the decisions to issue the RFIs are exclusively within the knowledge of the Minister .

[ 21 ] While the Applicants raise this argument principally in connection with the third issue raised in these applications (i.e., whether the RFIs were issued for purposes related to the administration or enforcement of the ITA ), the point is also relevant to the other issues, in which the Applicants also submit that the Respondent has not advanced a sufficient evidentiary foundation to support the issuance of the RFIs under s 231.2(1) of the ITA . [ 22 ] The Respondent disagrees with the Applicants’ position on the applicable burden of proof.

The Respondent submits that, as in all judicial review applications, the burden of proof is borne by the party challenging the decision under review, and it notes that the Applicants have also declined to file affidavit evidence in support of their applications. [ 23 ] On this issue, I agree with the Respondent.

The Supreme Court confirmed in Vavilov that the burden is on the party challenging an administrative decision to show that it is unreasonable (at para 100). [ 24 ] In support of their position on the burden of proof, the Applicants rely on the Federal Court’s decision in Capital Vision Inc v Minister of National Revenue , 2002 FCT 1317 [ Capital Vision ] , in which Justice Heneghan stated as follows at paragraphs 79 and 92: 79 I note, as well, that there is no statutory basis in the Act for the Minister to rely on an “inference” that may or may not be drawn by a third party to whom a requirement is served.

The Minister , not the taxpayer, bears the burden of complying with

section 231.2 . …. 92 As noted by the Court in Montreal Aluminum Processing, supra , the appropriate test for assessing the Minister ’s purpose in relation to

section 231.2 is an objective one. In my opinion, the Minister here has failed to objectively establish that he had fairly stated his purpose in issuing the new requirements. [ 25 ] The Respondent submits that the statements in Capital Vision should not be interpreted as suggesting that the burden of proof, in an application for judicial review of a decision made under s 231.2 of the Act , shifts to the Minister . Rather, these statements identify that the Minister must comply with the Act , which the Minister does not dispute. [ 26 ] I agree with the Respondent’s analysis of Capital Vision .

The outcome of that case turned on whether requirements served on the applicant were in support of an audit of the applicant or an audit of unnamed clients of the applicant. The Court found that the evidence supported the latter

interpretation (at para 72) and that, inconsistent with his obligations under the ITA , the Minister had been less than forthright in stating the purpose for those requirements (at para 77). Justice Heneghan’s comment about the " “burden” " does not represent a conclusion on the applicable burden of proof. [ 27 ] I also find no basis for an adverse inference arising from the absence of an affidavit filed by the Minister .

Subject to certain exceptions that have no application to the issues raised in the present matters, the general rule is that only the evidentiary record that was before the administrative decision-maker is admissible before the reviewing court (see, e.g., Tseil-Waututh Nation v Canada (Attorney General) , 2017 FCA 128 at paras 97-98 ). The CTR fulfils the role of placing the material in the evidentiary record before the reviewing court (see, e.g., Canadian Copyright Licensing Agency (Access Copyright) v Alberta , 2015 FCA 268 at para 17 ). C.

Whether the RFI is invalid because the Minister failed to obtain the judicial authorization required under s 231.2(2) of the ITA for an unnamed persons requirement

(1) Statutory Provisions Relevant to Unnamed Persons [ 28 ] To understand this first substantive issue raised by the Applicants, it is useful to review certain provisions of ss 231 to 231.8 of the ITA . The complete text of the sections referenced in these Reasons is set out in Appendix " “A” " hereto. [ 29 ]

Section 231.2(1), under which the RFIs were issued, entitles the Minister , for any purpose related to the administration or enforcement of the Act , to serve on any person a notice requiring that person to provide any information or document: " Requirement to provide documents or information " " Production de documents ou fourniture de renseignements " " 231.2

(1) Notwithstanding any other provision of this Act , the Minister may, subject to subsection (2), for any purpose related to the administration or enforcement of this Act (including the collection of any amount payable under this Act by any person), of a listed international agreement or, for greater certainty, of a tax treaty with another country, by notice served personally or by registered or certified mail, require that any person provide, within such reasonable time as is stipulated in the notice, " " 231.2 (1) " "

Malgré les autres dispositions de la présente loi, le ministre peut, sous réserve du paragraphe (2) et, pour l’application ou l’exécution de la présente loi (y compris la perception d’un montant payable par une personne en vertu de la présente loi), d’un accord international désigné ou d’un traité fiscal conclu avec un autre pays, par avis signifié à personne ou envoyé par courrier recommandé ou certifié, exiger d’une personne, dans le délai raisonnable que précise l’avis : " " (

a) any information or additional information, including a return of income or a supplementary return; or " " a) " " qu’elle fournisse tout renseignement ou tout renseignement supplémentaire, y compris une déclaration de revenu ou une déclaration supplémentaire; "

" (

b) any document. " " b) " " qu’elle produise des documents. " [ 30 ] The Minister ’s entitlement under 231.2(1) is subject to subsection (2). Subsections (2) and (3), which relate to " “unnamed persons,” " provide as follows: " Unnamed persons " " Personnes non désignées nommément " "

(2) The Minister shall not impose on any person (in this

section referred to as a “third party”) a requirement under subsection 231.2(1) to provide information or any document relating to one or more unnamed persons unless the Minister first obtains the authorization of a judge under subsection 231.2(3) . " " (2) " " Le ministre ne peut exiger de quiconque — appelé « tiers » au présent

article — la fourniture de renseignements ou production de documents prévue au paragraphe (1) concernant une ou plusieurs personnes non désignées nommément, sans y être au préalable autorisé par un juge en vertu du paragraphe (3). " " Judicial authorization " " Autorisation judiciaire "

(3) A judge of the Federal Court may, on application by the Minister and subject to any conditions that the judge considers appropriate, authorize the Minister to impose on a third party a requirement under subsection (1) relating to an unnamed person or more than one unnamed person (in this

section referred to as the “group”) if the judge is satisfied by information on oath that " "

(3) Sur requête du ministre, un juge de la Cour fédérale peut, aux conditions qu’il estime indiquées, autoriser le ministre à exiger d’un tiers la fourniture de renseignements ou la production de documents prévues au paragraphe (1) concernant une personne non désignée nommément ou plus d’une personne non désignée nommément — appelée « groupe » au présent

article —, s’il est convaincu, sur dénonciation sous serment, de ce qui suit : " " " (

a) the person or group is ascertainable; and " " a) " " cette personne ou ce groupe est identifiable; " " (

b) the requirement is made to verify compliance by the person or persons in the group with any duty or obligation under this Act . " " b) " " la fourniture ou la production est exigée pour vérifier si cette personne ou les personnes de ce groupe ont respecté quelque devoir ou obligation prévu par la présente loi; " " (

c) and (d) [Repealed, 1996, c. 21, s. 58(1)] " " c) " " et d) [Abrogés, 1996, ch. 21, art. 58(1)] " [ 31 ] When the unnamed persons provisions are engaged, the Minister must, before issuing a requirement under s 231.2(1), apply for judicial authorization from the Federal Court under s 231.2(3), which prescribes the test to be employed by the Court when considering such an application.

In Canada (National Revenue) v Hydro-Québec , 2018 FC 622 [ Hydro-Québec ], a decision upon which the Applicants rely, Justice Roy explained the purpose of the unnamed persons provisions as follows (at para 68): 68 It is obvious upon examination of the context in which subsections 231.2 (2) and (3) are found that Parliament wanted to limit the scope of the Minister ’s powers, extensive as they are. The purpose of the provision is to limit the scope of requests for information that can be issued.

Thus, the fear of abuse that could be generated by the case law of Canadian Bank of Commerce , Richardson , McKinlay and Jarvis is seen in the obligation of judicial intervention in the case where the targeted individuals cannot be identified by name. Parliament wants to protect unnamed persons ex ante , so as to avoid undue invasions and not to remedy them later.

The protection that Parliament wants to grant is based on a request made to administer or enforce the Act , which case law had interpreted as requiring a genuine and serious inquiry in the case of previously identified individuals, but especially, in the case of people who cannot even be named, that they be identifiable and that we want to verify whether this unnamed but identifiable person has respected duties and obligations outlined in the ITA . It is clear that Parliament is seeking a certain specificity if a request related to people who are unnamed may be targets.

In this case, we are searching in vain for a criterion connected to the ITA that would turn the group into an ascertainable group for the purpose of administering or enforcing the Act and for which it would be permissible to seek information to thereupon verify compliance with the Act . [ 32 ] The issue in dispute between the parties in the present applications is whether the unnamed persons provisions are engaged by the RFIs under review. The Information Sheets that were before the decision-maker identify the particular parties that the Minister was investigating in issuing each of the RFIs.

However, the Applicants argue that the Minister did not name these parties in the RFIs themselves and was therefore required to seek judicial authorization under s 231.2(3) before issuing the RFIs. [ 33 ] The Respondent disputes this

interpretation of how the unnamed persons provisions operate. The Respondent argues that, because the parties under investigation are known to the Minister , the unnamed persons provisions do not apply. [ 34 ] Reduced to its simplest articulation, the dispute surrounds the meaning of the term " “unnamed persons.” " In effect, the Applicants submit that it means unnamed in the RFI, and the Respondent submits that it means unknown to the Minister . Before considering the merits of the parties’ arguments on this issue, and the reasonableness of the RFIs against the backdrop of those arguments, it is useful to review some of the authorities that have considered the unnamed persons provisions.

(2) Jurisprudence

[35] The Respondent submits that the leading authorities are the decisions of the Federal Court of Appeal in Canada (Customs andRevenue Agency) v Artistic Ideas Inc., 2005 FCA 68 [Artistic Ideas] and the subsequent decision of the Supreme Court of Canada inRedeemer Foundation v Minister of National Revenue, 2008 SCC 46 [Redeemer]. [36] In Artistic Ideas, the Minister began an audit of Artistic Ideas Inc. [Artistic], a company that arranged the sale of artwork toindividual Canadian taxpayers who in turn donated the artwork to registered charities.

In the course of the audit, the Minister servedupon Artistic a requirement under s 231.2(1) of the ITA, which required it to provide information including the names of the donors andthe charities. Artistic sought to strike that portion of the requirement. Justice Snider had concluded in the decision below that theMinister was entitled to the names of the charities but not to the names of the donors. The Minister appealed that decision. [37] Writing for the Federal Court of Appeal, Justice Rothstein explained the operation of the unnamed persons provisions as follows (atpara 8): 8 As I understand the scheme of

section 231.2, the Minister may require a third party to provide information and documentspertaining to the third party's compliance with the Act. However, the Minister may not impose a requirement on the thirdparty to provide information or documents relating to unnamed persons whom he wishes to investigate, unless he firstobtains the authorization of a judge.

The judge may authorize the Minister to require such information only if the unnamedpersons are ascertainable and only if satisfied that information or documents relating to them is required to verifycompliance by them with the Act. [38] In upholding Justice Snider’s decision, Justice Rothstein provided the following analysis (at paras 10-13): 10 According to the evidence in the present case, the donors are intended to be the subject of investigations by the Minister.They are precisely the persons to whom subsections 231.2(2) and (3) apply.

If the Minister wants to obtain the names of thedonors from Artistic, he must obtain an authorization from a judge to do so. The Minister has not obtained such authorizationand therefore he cannot require Artistic to provide information about the donors. 11 However, where unnamed persons are not themselves under investigation, subsections 231.2(2) and (3) do not apply.Presumably, in such cases the names of unnamed persons are necessary solely for the Minister's investigation of the thirdparty.

In such cases a third party served with a requirement to provide information and documents under subsection 231.2(1)must provide all the relevant information and documents including the names of unnamed persons.

That is becausesubsection 231.2(2) only pertains to those unnamed persons in respect of whom the Minister may obtain an authorization ofa judge under subsection 231.2(3). 12 There is no evidence that the Minister wishes to have the names of the charities to verify their compliance with the Act.He is therefore entitled to the names of the charities under subsection 231.2(1) because subsections 231.2(2) and (3) do notapply to the charities. 13 The result is that Snider J. was correct in finding that Artistic had to disclose the names of the charities but did not haveto disclose the names of the donors. [39] The effect of Artistic Ideas was to clarify that the unnamed persons provisions are not engaged if the Minister serves a requirementseeking to identify unnamed persons who are not themselves being investigated as to their compliance with the ITA.

Although notrelying on Artistic Ideas, the Supreme Court subsequently confirmed this

interpretation in Redeemer (see Chief Justice McLachlin andJustice LeBel for the majority at para 22 and Justice Rothstein in dissent, although not on this issue, at para 48). [40] There are decisions predating Artistic Ideas and Redeemer, which appear inconsistent with these cases, because they interpret theunnamed persons provisions as applying whenever the Minister sought information about an unnamed person, regardless of whether thatperson was the subject of an investigation (see Canadian Forest Products Ltd v Minister of National Revenue (1996), (FC), 119 FTR 152 (FCTD) [Canadian Forest Products] and Canada (Minister of National Revenue) v Toronto Dominion Bank,2004 FCA 359 [TD Bank] at para 8).

However, in a number of subsequent decisions, this Court has addressed the apparent inconsistencybetween Artistic Ideas and TD Bank and has followed Artistic Ideas (see Canada (National Revenue) v Morton, 2007 FC 503 at para 11;Canada (National Revenue) v Advantage Credit Union, 2008 FC 853 at paras 16-17; Canada (National Revenue) v Amex Bank ofCanada, 2008 FC 972 at para 54; London Life v Canada (Attorney General), 2009 FC 956 [London Life] at paras 21-24). The FederalCourt of Appeal has also adopted the

interpretation of s 231.2(2) consistent with Artistic Ideals in eBay Canada Ltd v Canada, 2008 FCA348 [eBay] at paragraph 23. [41] I pause to note that the particular issue that was addressed differently in Artistic Ideas and TD Bank is not itself in dispute betweenthe parties in the present applications. The Applicants’ counsel confirmed during the hearing that the Applicants are not asserting that s231.2(2) is engaged in relation to unnamed persons who are not themselves under investigation. Regardless, that point has been settledby the jurisprudence canvassed above.

However, it is important to assess the particular issue that is in dispute against the backdrop ofthis jurisprudence. As previously noted, that issue is whether s 231.2(2) is engaged when the Minister issues a requirement seekinginformation about a party, whose compliance with the ITA is under investigation, in circumstances where the identity of the party isknown to the Minister but the party is not named in the requirement. [42] It is useful at this stage of the analysis to refer to the particular facts, relevant to the individual RFIs under review, which give riseto this issue in these applications.

(3) Triple Five RFIs - T-1439-18 and T-1440-18 [43] Each of the two Triple Five RFIs lists in its subject line the names of seven corporations (Triple Five World Group PropertiesLimited, Triple Five Amusement World Enterprises Limited, Triple Five World Investments Limited, Triple Five World Malls Limited,Triple Five World Properties Limited, Triple Five World Ventures Limited, and World Alliance Consulting Limited). As previously

noted, the RFIs request production of information and documents relating to these corporations, in particular banking information and documents including a list of bank accounts, bank statements, and details concerning incoming and outgoing funds transfers. [ 44 ] The principal document in the record that was before the decision-maker, before issuing the Triple Five RFIs to Mr. Ghermezian and Mr. Vaturi, is the Ghermezian and Vaturi Information Sheet.

That document provides information about the background to the issuance of the RFIs, including identifying which entities are the subject of the Minister ’s investigation. The Information Sheet states, " “Information is requested about these Canadian taxpayers:” " and then references the Ghermezian Family Trust dated February 15, 1997 [97GFT] and Triple Five Worldwide Limited [T5WW] and its subsidiaries and sister companies. The Information Sheet then refers to " “Tax years under consideration:” " and identifies particular tax years for 97GFT, for T5WW and its subsidiaries, and for Mr. Ghermezian and Mr. Vaturi.

The reference to the particular tax years for Mr. Ghermezian and Mr. Vaturi is prefaced by the words " “For any consequential adjustments” " . [ 45 ] The Applicants and the Respondent interpret the Information Sheet slightly differently. The Applicants’ position is that it demonstrates that 97GFT and T5WW are the parties under investigation. The Respondent’s position is that it identifies those parties as well as Mr. Ghermezian and Mr. Vaturi as under investigation. The Applicants dispute that the Information Sheet identifies Mr. Ghermezian and Mr.

Vaturi as under investigation, because it refers only to the possibility of consequential adjustments to their tax returns, presumably depending upon the outcome of the investigations of 97GFT and T5WW. [ 46 ] In my view, little turns on this particular area of disagreement, given the nature of the Applicants’ unnamed persons argument. Specifically, they submit that 97GFT and T5WW are the parties under investigation and that, as those parties are not named in the Triple Five RFIs, the Minister was obliged to comply with ss 231.2(2) and (3) and seek judicial authorization before issuing the RFIs.

The Respondent argues the Minister was under no such obligation, because, as demonstrated by the Information Sheet, the identities of 97GFT and T5WW were known to the Minister . While the Respondent argues that Mr. Ghermezian and Mr. Vaturi, to whom the Triple Five RFIs were directed, were also under investigation, this point is not particularly responsive to the Applicants’ argument, which turns on whether the unnamed persons provisions were engaged by the lack of a reference to 97GFT and T5WW in the RFIs. [ 47 ] I will return to the Applicants’ argument on this point later in this analysis.

(4) Gibraltar RFIs - T-1451-18 and T-1452-18 [ 48 ] Each of the two Gibraltar RFIs refers in its subject line to " “Gibraltar entities managed and controlled by Nader Ghermezian and Marc Vaturi.” " As previously noted, the RFIs request production of corporate records and bank statements related to certain foreign corporations. The RFIs refer to seven corporations, subsidiaries of such corporations, and any other entities owned by the Ghermezian Family Trust.

One of the seven corporations listed in the RFI is T5WW. [ 49 ] As with the Triple Five RFIs, the principal document in the record that was before the decision-maker, before issuing the Gibraltar RFIs to Mr. Ghermezian and Mr. Vaturi, is the Ghermezian and Vaturi Information Sheet. As previous noted, the Applicants’ position is that the Information Sheet demonstrates that 97GFT and T5WW are the parties under investigation. Unlike the Triple Five RFIs, the Gibraltar RFIs do contain express references to 97GFT and T5WW as parties in relation to which information and documentation is sought.

However, the Applicants note that the Gibraltar RFIs do not expressly state that 97GFT and T5WW are the parties under investigation. The Applicants therefore argue that the Minister was obliged to comply with ss 231.2(2) and (3) and seek judicial authorization before issuing the RFIs. The Respondent again responds that the Minister was under no such obligation, because, as demonstrated by the Information Sheet, the identities of 97GFT and T5WW were known to the Minister .

(5) Gherfam RFI – T-1501-18 [ 50 ] The Gherfam RFI is structured somewhat differently than the other RFIs under review in these applications. The Gherfam RFI consists of a letter, addressed to Gherfam and referring to Gherfam in its subject line, which states that Gherfam is required to provide all information and documents requested in the attached Audit Information Requests No. GEI-27 and GEI-29. [ 51 ] Audit Information Request No.

GEI-27 [GEI-27] is also addressed to Gherfam and refers in its subject line to " “2014 Restructuring and Refinancing of the Mall of America.” " It requests production of particular documents and categories of documents relating to a restructuring and refinancing transaction related to the Mall of America that occurred in 2014. [ 52 ] Audit Information Request No.

GEI-29 [GEI-29] is again addressed to Gherfam and refers in its subject line to " “$15 Million Loan from First Security Bank N.A.” " It requests production of information and documents relating to T5MN, including the historical asset holdings of T5MN and related entities and financial statements of T5MN. [ 53 ] In referring to information requested in connection with entities related to T5MN, GEI-29 states, " “This information is only requested in respect of entities that were not acquired or held at any time, directly or indirectly, by any of the Ghermezian Family Trusts settled on September 1, 2002 and August 15, 2002 (commonly referred to as the Royce and Regent Trusts).” " GEI-29 also includes a request framed as follows: " “Provide any additional information or explanations that are relevant to determining whether or not the rules of former

section 94 of the Act (for taxation years before 2007) applies to the Royce and Regent Trusts in respect of the transaction described in the background of this query.” " [ 54 ] The principal document in the record that was before the decision-maker, before issuing the Gherfam RFI, is the Gherfam Information Sheet. That document provides information about the background to the issuance of the RFI, including identifying which entities are the subject of the Minister ’s investigation. The Information Sheet refers to " “Tax years under consideration:” " and identifies particular tax years for " “the U.S.

Family Trusts (Mall of America)” " and for " “the American Dream Trust(s).” " In submissions at the hearing, the Respondent’s counsel explained that the Gherfam Information Sheet relates not only to the Gherfam RFI but also to another RFI that is not under review in the present applications. Counsel explained that the reference in the Information Sheet to the American Dream Trust(

s) relates to that other RFI and is therefore irrelevant to the Gherfam RFI presently under review.

[55] The Respondent’s Memorandum of Fact and Law states that the transactional documents sought from Gherfam through theGherfam RFI are for purposes of auditing Gherfam. However, the Respondent’s counsel has confirmed that this statement was an errorin the Memorandum and that the transactional documents are sought for purposes of auditing the residency of eight Ghermezian U.S.Family Trusts (Mall of America) settled on August 15, 2002 and September 1, 2002, described as commonly referred to as the Royce andRegent Trusts.

The Applicant does not dispute the Respondent’s representation as to the targets of the investigation that prompted theGherfam RFI. Its unnamed persons argument is consistent with that representation. [56] The Applicant submits that the Gherfam RFI does not identify the targeted trusts by name and does not state that they are thesubjects of the Minister’s investigation. The Applicant therefore argues that the Minister was obliged to comply with ss 231.2(2) and (3)and seek judicial authorization before issuing the RFI.

The Respondent again responds that the Minister was under no such obligation,because, as demonstrated by the Information Sheet, the identities of the trusts under investigation were known to the Minister.

(6) Reasonableness of the Decision to Issue the RFIs [57] Returning to the dispute between the parties, as to whether the term "“unnamed persons”" employed in ss 231.2(2) and (3) meansunnamed in the RFI or unknown to the Minister, I first note that it is not the role of the Court, sitting in judicial review of the RFIs, todetermine the meaning of this term.

Rather, taking into account the arguments raised by the parties, I must decide whether it wasreasonable for the decision-maker to issue the RFIs without first seeking judicial authorization under ss 231.2(3). [58] The Applicants’ arguments on this issue include the point that neither the RFIs nor the supporting Information Sheets contain anyconsideration of the question whether the unnamed persons provisions of the ITA were engaged.

In other words, there is no expressindication that the decision-maker considered the possible application of ss 231.2(2) and (3) and whether judicial authorization should besought before issuing the RFIs. The Applicants submit that the absence of such consideration itself makes the decision to issue the RFIsunreasonable. [59] I accept that there are circumstances where a decision may be found unreasonable because neither the decision nor the supportingrecord expressly demonstrates consideration of the impact of a potentially relevant statutory provision.

An argument of that sort may becompelling where a party to a proceeding before a quasi-judicial tribunal raises an issue surrounding the application of a statutoryprovision and the tribunal’s decision fails to demonstrate any consideration of that issue.

However, such an argument is less compellingin circumstances such as those presently under review, where the nature of the administrative process is such that the issue was not raisedbefore the decision-maker but rather is raised in the subsequent challenge of the decision through judicial review. [60] In the present case, the decision that no judicial authorization was required in advance of the issuance of the RFIs can perhaps bebest characterized as an implicit decision, and the judicial review of that decision is guided by the principles canvassed earlier in theseReasons (noting in particular paragraphs 123 and 137-138 of Vavilov).

I must consider the record and the outcome of the decision, inassessing whether the implicit decision, that ss 231.2(2) and (3) were not engaged, was reasonable. In my view, as there is little in therecord before the decision-maker that particularly assists with this analysis, my assessment of reasonableness must turn significantly onthe outcome of the decision not to pursue the ss 231.2(2) and (3) process. [61] As this aspect of the decision involves at least in part a matter of statutory

interpretation, I note that I am conscious of the modernapproach to statutory

interpretation, requiring consideration of the text, context and purpose of the statutory provision in issue (see, e.g.,Vavilov at paras 117-118, 121). One of the Applicants’ principal submissions in support of its position on the disputed issue is that ss231.2(2) and (3) employ the term "“unnamed persons.”" They do not, for instance, employ a term such as "“persons unknown to theMinister.”" I agree that consideration of this aspect of the text of the statute favours the Applicants’

interpretation. [62] However, the Respondent argues that it would be nonsensical to interpret the legislation as requiring the Minister to seek judicialauthorization under ss 231.2 (3) in connection with an RFI targeting a person whose name the Minister already knows. The Respondentnotes that the test the Minister must meet in an application under ss 231.2 (3) requires demonstration that: (

a) the person or group ofpersons is ascertainable; and (

b) the requirement is made to verify compliance by the person or persons with any duty or obligation underthe ITA. The Respondent submits that the obligation to demonstrate the person or group is ascertainable supports her position that theunnamed persons provisions are directed at circumstances in which the Minister does not know the names of the parties she wishes totarget. [63] In order to issue a requirement directing a third party to provide the names of such parties and information or documentation relatedthereto, the Minister must convince the Court that it is possible to identify those names.

I agree that test makes little sense in acircumstance where the Minister already knows the names. This argument, which relies upon the context of the statutory language indispute, favours the Respondent’s

interpretation. [64] The body of jurisprudence interpreting and applying the unnamed person provisions provides some guidance as to their purpose. InMNR v Sand Exploration Ltd, (FC), [1995] 3 FC 44 at page 7, Justice Rothstein described these provisions asintended to prevent fishing expeditions.

In Hydro-Québec, Justice Roy (at para 53) referred to Canadian Forest Products’ description ofthese provisions as intended to protect against abusive investigations and expanded upon this explanation at paragraph 68 (reproducedearlier in these Reasons). [65] That explanation describes ss 231.2 (2) and (3) as affording protections against abusive investigations to the unnamed persons, notto the party who is the recipient of the requirement, and refers to those persons as targeted individuals who cannot be identified by name.The potential for abuse is addressed, because of the criteria the Minister must satisfy in order to obtain the necessary judicialauthorization, including that such persons are identifiable.

I consider this description of the purpose of the unnamed person’s provisionsto be consistent with the Respondent’s

interpretation, that the provisions are concerned with circumstances where the Minister is seekinginformation about taxpayers that the Minister cannot yet identify, and not with circumstances where the Minister knows that identity buthas failed to include it in the applicable requirement. [66] Both parties devoted considerable argument to the jurisprudence that has interpreted and applied the unnamed persons provisions.

The Applicants place considerable reliance upon Canadian Forest Products , a case involving requirements issued to companies active in the forest industry, seeking information in the course of auditing other companies in the same industry. It appears that the Minister knew the names of the companies it was auditing but did not name those companies in the requirements. The Minister advanced an argument, akin to the one now under consideration, that s 231.2(2) is designed to address a situation where the Minister is looking for noncomplying taxpayers and does not know their identities (see para 5).

This Court rejected that argument, holding that, because the taxpayers under investigation were not named, the Minister was required to proceed under s 231.2(3). Canadian Forest Products was cited with approval in Capital Vision . [ 67 ] The Respondent relies on the authorities that have applied ss 231.2(2) and (3) in circumstances consistent with the Respondent’s

interpretation of that provision, i.e. where the Minister was seeking from a third party the names of taxpayers that the Minister wished to investigate, but did not know, and information or documentation related to those taxpayers. In Hydro-Québec , while not addressing the particular issue presently in dispute, Justice Roy provided a succinct

summary of some of these authorities (at para 62): 62 As noted, requests for information target persons who are unnamed but who are certainly ascertainable or are members of an ascertainable group for tax purposes. Moreover, we are seeking financial information directly related and pertinent to income generated by these people who owe taxes (beyond a certain threshold). In GMREB-FCA , the brokers and real estate agents on Montréal’s South Shore are targeted to monitor the commissions received on the immovable properties sold. The group of brokers and agents could include about 2,000 people.

The Federal Court of Appeal informs us that the audit of a real estate agent in March 2005 aroused the interest of the Minister , who wanted to know more about the income generated by commissions. In eBay , information was being sought about the PowerSellers’ business volume; the information was on servers in the United States and, at the time, it was estimated that the Canadian PowerSellers program had about 10,000 participants.

In Sand Exploration , it was individuals who had purchased an interest in certain seismic data (a number that was estimated at 12) that led to a tax benefit as a result of inflated prices (p 54). In Redeemer Foundation v. Canada (National Revenue) , 2008 SCC 46 ; [2008] 2 SCR 643 [ Redeemer Foundation ], attention was drawn by students’ parents who made donations to reduce their children’s tuition. It was the audit of the Redeemer University College Foundation that had created this attention regarding "donors" who had benefited from tax credits. In Canada (Customs and Revenue Agency ) v.

Artistic Ideas Inc. , 2005 FCA 68 , Justice Rothstein, this time as an appellate judge, was satisfied that donors in what was suspected to be "art flips" (successive purchases and sales of artworks) and for which inappropriate tax deductions were claimed constituted an ascertainable group (paragraph 10).

In the end, we studied a given group whose characteristics rendered the individuals ascertainable with the specific financial information requested to be certain of the reasonableness of the application. [ 68 ] I agree with the Respondent that these authorities, many of which were canvassed earlier in these Reasons, involve the application of the unnamed persons provisions in circumstances where the Minister was seeking information which included identification of groups (and in many cases large groups) of taxpayers, where the Minister wished to investigate those taxpayers and issued requirements in order to obtain their names.

Those authorities involved analysis by the Court as to whether the taxpayers or groups thereof were ascertainable, Hydro-Québec representing an example where the Court concluded they were not. [ 69 ] The Applicants have identified authorities where courts have employed the term " “unnamed,” " in considering the application of ss 231.2(2) and (3), most notably a number of such references in Justice Rothstein’s analysis in Redeemer . In contrast, there is language in some of the authorities that could be argued to support the Respondent’s

interpretation. For instance, in Hydro-Québec , Justice Roy described the requirement for judicial authorization as a function of the fact that the targets of the information gathering are unnamed and therefore unknown (at para 30). In London Life , Justice Pinard refers to the different processes that are required, depending on whether the Minister is requesting information about a " “known taxpayer” " or " “unknown persons” " (at para 17).

In Blue Bridge Trust Company Inc v Canada (National Revenue) , 2020 FC 893 , Justice Lafrenière refers to prior judicial authorization not being required when a taxpayer is known (at para 105). [ 70 ] Indeed, in paragraph 48 of Redeemer , Justice Rothstein refers to a requirement to obtain judicial authorization in a circumstance where the Canada Revenue Agency [CRA] has formed the intent to obtain information pertaining to compliance of specific but unnamed persons and requests that a charity provide information so that the CRA can obtain the information and names of the unnamed persons (my emphasis). [ 71 ] In my view, none of the authorities canvassed above is determinative of the statutory

interpretation issue presently in dispute. While the particular factual circumstances under consideration in the authorities, and the language used in applying the unnamed persons provisions, are relevant to the consideration of the issue, none of the authorities provides a considered analysis and pronouncement on the particular issue now in dispute. The one case that does speak directly to this issue is Canadian Forest Products .

However, the Respondent notes that this decision has been overtaken by Artistic Ideas , Redeemer , and other subsequent authorities, and submits that it should not be followed. [ 72 ] I agree that Canadian Forest Products must be approached with caution. While it has not been expressly overruled by subsequent jurisprudence, its conclusion to the effect that the unnamed persons provisions were engaged whenever the Minister sought information about an unnamed person, regardless of whether the unnamed person was the subject of the investigation, is clearly no longer good law.

Of course, that conclusion is not the issue currently under dispute. However, the evolution of the jurisprudence casts sufficient doubt on the reasoning in Canadian Forest Products , that I would be reluctant to place substantial reliance upon it in guiding the analysis of the issue now before the Court. [ 73 ] Against that jurisprudential backdrop, I return to the standard of review applicable to the decisions under consideration in these applications.

The question is whether the decision-maker’s implicit decisions, that it was unnecessary to seek judicial authorization under s 231.2(3) before issuing the RFIs, were outside the range of acceptable outcomes and therefore unreasonable in the circumstances of this case. There is no definitive jurisprudence on the point, factors relevant to the text, context and purpose of the relevant provisions do not clearly resolve the issue, and such jurisprudence and factors in some respects support the implicit decisions. I therefore cannot conclude that the decisions are unreasonable.

[ 74 ] I also find particularly compelling the Respondent’s argument that the decision-maker could hardly have been expected to pursue an application under s 231.2(3), in an effort to satisfy the Court that the persons the Minister wished to investigate were ascertainable, when the identities of those persons were actually known to the Minister .

At most, the decision-maker might have expressly included the full names of the relevant targeted persons in each of the RFIs and expressly identified them as the targets of the investigation, in which case the Applicants would not be advancing the unnamed persons argument presently under consideration. However, I have difficulty concluding that those measures would have afforded the persons under investigation with any additional protection of the sort that the unnamed persons provisions are concerned with.

Therefore, focusing on the outcome in the present matters, in relation to the RFIs under review in all five applications presently before the Court, I find that it was reasonable for the decision-maker to have issued the RFIs without seeking judicial authorization in advance.

(7) Additional Arguments of the Applicants [ 75 ] Before leaving this issue, I will address briefly additional arguments advanced by the Applicants, either orally or in writing, in relation to the unnamed persons issue. [ 76 ] In relation to the Gherfam RFI, the Applicant notes that the record does not include a list of the names of the eight trusts that are the subject of the Minister ’s investigation, perhaps raising the possibility that the Minister does not actually know the identities of these trusts.

However, the record describes the trusts as U.S. family trusts of the Ghermezian family, notes the names by which they are commonly referred to (the Royce and Regent Trusts) and, significantly, identifies the dates of their settlement.

In my view, the record does not support a conclusion that the targets of the investigation were unknown to the Minister , such that it was unreasonable for the decision-maker to have issued the Gherfam RFI without seeking judicial authorization under the unnamed persons provisions. [ 77 ] In relation to the Triple Five RFIs, the Applicants’ Memorandum of Fact and Law advances a couple of particular unnamed persons arguments. The Applicants did not press these arguments during oral submissions.

However, as the Applicants noted in general that they continued to rely on their written submissions, I wish to address these arguments. [ 78 ] First, the Applicants note that the Triple Five RFIs impose a requirement to provide " “information and documents for the above- named corporations, either alone or jointly with any other person ” " (Applicants’ emphasis).

The Applicants submit that, because the RFIs failed to define " “any other person,” " that language represents a reference to one or more unnamed persons within the meaning of s 231.2(2). [ 79 ] Second, the Applicants note that the Triple Five RFIs require the " “names of the sending party for transfers from other bank accounts” " together with their account information and " “names of the receiving party” " together with account information. The Applicants submit that the sending and receiving parties are also unnamed persons within the meaning of s 231.2(2). [ 80 ] I find no merit to these submissions.

As explained earlier in these Reasons, the unnamed persons provisions are not engaged where a requirement seeks information related to an unnamed person that is not the subject of the Minister ’s investigation. The Applicants have not identified any basis in the record to regard these particular portions of the RFIs as referring to parties under investigation.

I therefore find no basis to conclude that it was unreasonable for the decision-maker to issue the Triple Five RFIs without recourse to the unnamed persons provisions. [ 81 ] In relation to the Gibraltar RFIs, the Applicants’ Memorandum of Fact and Law also advanced an additional unnamed persons argument which, while not pressed during oral submissions, I will briefly address.

These RFIs include a requirement to provide information and documents for " “all entities not listed above that currently/previously are/were legally or beneficially owned by the Ghermezian Family Trust dated February 15, 1997 (or one of its predecessors).” " The Applicants submit that this requirement requests information or documents relating to one or more unnamed persons within the meaning of s 231.2(2). [ 82 ] Again, I do not find merit in this submission. The Applicants have not identified any basis in the record to regard this language as referring to parties under investigation.

I therefore find no basis to conclude that it was unreasonable for the decision-maker to issue the Gibraltar RFIs without recourse to the unnamed persons provisions. D. Whether the RFI is invalid because the Minister failed to comply with the criteria in s 231.6 of the ITA for foreign-based information

(1) Statutory Provisions Relevant to Foreign-Based Information [ 83 ] This argument advanced by the Applicants, again in relation to all five RFIs under review, is based on s 231.6, which provides as follows: " Definition of foreign-based information or document " " Sens de renseignement ou document étranger " " 231.6

(1) For the purposes of this section, foreign based information or document means any information or document that is available or located outside Canada and that may be relevant to the administration or enforcement of this Act , including the collection of any amount payable under this Act by any person.

" " 231.6 (1) " " Pour l’application du présent article, un renseignement ou document étranger s’entend d’un renseignement accessible, ou d’un document situé, à l’étranger, qui peut être pris en compte pour l’application ou l’exécution de la présente loi, y compris la perception d’un montant payable par une personne en vertu de la présente loi. " " Requirement to provide foreign-based information " " Obligation de fournir des renseignements ou documents étrangers "

"

(2) Notwithstanding any other provision of this Act , the Minister may, by notice served personally or by registered or certified mail, require that a person resident in Canada or a non-resident person carrying on business in Canada provide any foreign-based information or document. " " (2) " "

Malgré les autres dispositions de la présente loi, le ministre peut, par avis signifié à personne ou envoyé par courrier recommandé ou certifié, exiger d’une personne résidant au Canada ou d’une personne n’y résidant pas mais y exploitant une entreprise de fournir des renseignements ou documents étrangers. " " Notice " " Contenu de l’avis " "

(3) The notice referred to in subsection 231.6(2) shall set out " " (3) " " L’avis doit: " " (

a) a reasonable period of time of not less than 90 days for the production of the information or document; " " a) " " indiquer le délai raisonnable, d’au moins 90 jours, dans lequel les renseignements ou documents étrangers doivent être fournis; " " (

b) a description of the information or document being sought; and " " b) " " décrire les renseignements ou documents étrangers recherchés; " " (

c) the consequences under subsection 231.6(8) to the person of the failure to provide the information or documents being sought within the period of time set out in the notice. " " c) " " préciser les conséquences prévues au paragraphe (8) du défaut de fournir les renseignements ou documents étrangers recherchés dans le délai ci-dessus. " " Review of foreign information requirement " " Révision par un juge " "

(4) The person on whom a notice of a requirement is served under subsection 231.6(2) may, within 90 days after the service of the notice, apply to a judge for a review of the requirement. " " (4) " " La personne à qui l’avis est signifié ou envoyé peut, dans les 90 jours suivant la date de signification ou d’envoi, contester, par requête à un juge, la mise en demeure du ministre. " " Powers on review " " Pouvoirs de révision " "

(5) On hearing an application under subsection 231.6(4) in respect of a requirement, a judge may " " (5) " " À l’audition de la requête, le juge peut : " " (

a) confirm the requirement; " " a) " " confirmer la mise en demeure; " " (

b) vary the requirement as the judge considers appropriate in the circumstances; or " " b) " " modifier la mise en demeure de la façon qu’il estime indiquée dans les circonstances; " " (

c) set aside the requirement if the judge is satisfied that the requirement is unreasonable. " " c) " " déclarer sans effet la mise en demeure s’il est convaincu que celle-ci est déraisonnable. " " Idem " " Précision " "

(6) For the purposes of paragraph 231.6(5) (c), the requirement to provide the information or document shall not be considered to be unreasonable because the information or document is under the control of or available to a non-resident person that is not controlled by the person served with the notice of the requirement under subsection 231.6(2) if that person is related to the non- resident person.

" " (6) " " Pour l’application de l’alinéa (5)c), le fait que des renseignements ou documents étrangers soient accessibles ou situés chez une personne non-résidente qui n’est pas contrôlée par la personne à qui l’avis est signifié ou envoyé, ou soient sous la garde de cette personne non-résidente, ne rend pas déraisonnable la mise en demeure de fournir ces renseignements ou documents, si ces deux personnes sont liées. " " Time period not to count " " Suspension du délai " "

(7) The period of time between the day on which an application for review of a requirement is made pursuant to subsection (4) and the day on which the application is finally disposed of shall not be counted in the computation of " " (7) " " Le délai qui court entre le jour où une requête est présentée conformément au paragraphe (4) et le jour où la requête est définitivement réglée ne compte pas dans le calcul : " " (

a) the period of time set out in the notice of the requirement; and " " a) " " du délai indiqué dans l’avis correspondant à la mise en demeure qui a donné lieu à la requête; " " (

b) the period of time within which an assessment may be made pursuant to subsection 152(4). " " b) " " du délai dans lequel une cotisation peut être établie conformément au paragraphe 152(4). " " Consequence of failure " " Conséquences du défaut "

"

(8) If a person fails to comply substantiallywith a notice served under subsection231.6(2) and if the notice is not set aside by ajudge pursuant to subsection 231.6(5), anycourt having jurisdiction in a civil proceedingrelating to the administration or enforcementof this Act shall, on motion of the Minister,prohibit the introduction by that person ofany foreign-based information or documentcovered by that notice.

" "(8)"" Si une personne ne fournit pas latotalité, ou presque, des renseignements oudocuments étrangers visés par la mise endemeure signifiée conformément auparagraphe (2) et si la mise en demeure n’estpas déclarée sans effet par un juge enapplication du paragraphe (5), tout tribunalsaisi d’une affaire civile portant surl’application ou l’exécution de la présente loidoit, sur requête du ministre, refuser le dépôten preuve par cette personne de toutrenseignement ou document étranger visé parla mise en demeure.

" [84] These provisions relate to requirements to provide a "“foreign-based information or document,”" which s 231.6(1) defines as anyinformation or document that is available or located outside Canada and that may be relevant to the administration or enforcement of theITA, including the collection of the amount payable under the ITA by any person. [85] When the Minister serves a requirement under s 231.6, that

section operates to afford the person served with certain protections.Under s 231.6(3), the requirement must afford the person no less than 90 days for the production of the information or document,provide a description of the information or document being sought, and set out the consequences of failing to comply. Under s 231.6(4),the person served has the right, within 90 days of service, to apply to the Court for a review of the requirement.

Section 231.6(5)provides that the Court may then confirm the requirement, vary it as the judge considers appropriate in the circumstances, or set asidethe requirement if the judge is satisfied that the requirement is unreasonable.

(2) Application of

Section 231.2(1) to Foreign-Based Information [86] The Applicants argue that, based upon the descriptions in the RFIs, the requested documents and information are prime facieavailable or located outside Canada and therefore constitute foreign-based information. They therefore submit that it was unreasonablefor the Minister to issue the RFIs under s 231.2 rather than s 231.6.

In support of this position, the Applicants argue that the Respondenthas failed to adduce any evidence in these applications showing that the documents and information requested in the RFIs are located oravailable within Canada. [87] The Respondent’s position on this argument is that the Minister is not required to resort to the foreign-based requirement regimeunder s 231.6 because, even if some of the information sought is located outside Canada, this fact does not invalidate the RFIs issuedunder s 231.2.

In support of this position, the Respondent places substantial reliance on an argument that the Applicants are required toproduce any information or documents requested in an RFI issued under s 231.2 that are in their power, possession and control, even ifthey are located outside of Canada. That is, independent of the foreign-based information regime, if the information or documentation iswithin the Applicants’ power, possession or control, they will have to produce it, regardless of where it is located. [88] The Applicants dispute this

interpretation of the ITA. They rely on the principle of statutory

interpretation expressed in Latin asgeneralia specialibus non derogant, meaning that the general does not derogate from the specific.

The Applicants also refer to theexpression of this principle as follows in James Richardson & Sons v MNR, (SCC), [1984] 1 SCR 614 at p 621 (quotingfrom Pretty v Solly (1959), 53 ER 1032): The rule is, that wherever there is a particular enactment and a general enactment in the same statute, and the latter, taken inits most comprehensive sense, would overrule the former, the particular enactment must be operative, and the generalenactment must be taken to affect only the other parts of the statute to which it may properly apply. [89] In other words, the Applicants argue that, as Parliament enacted s 231.6 to apply specifically to circumstances in which the Ministerwished to require production of foreign-based material, the more general power to issue requirements under s 231.2 should not beinterpreted as also applying to production of foreign-based material. [90] Returning again to the standard of review, I note that the Court’s role is to decide, against the backdrop of the parties’ arguments onthis point, whether it was reasonable for the decision-maker to issue the RFIs under s 231.2 rather than 231.6.

Similar to myconsideration of the unnamed persons issue, I note that the decision to employ s 231.2 rather than 231.6 represents an implicit decision,and the judicial review of that decision is guided by the principles canvassed earlier in these Reasons, relying on paragraphs 123 and137-138 of Vavilov. I must consider the record and the outcome of the decision, in assessing whether the implicit decision that s 231.6was not engaged was reasonable. [91] The Respondent relies on a number of authorities to support its expansive

interpretation of the operation of s 231.2. First, it refers toRevcon Oilfield Constructors Incorporated v Canada (National Revenue), 2017 FCA 22 [Revcon] as authority for its submission that theApplicants must comply with the RFIs issued under s 231.2 if the information and documents sought are within their power, possessionand control.

Revcon involved an appeal from a compliance order issued upon an application by the Minister under s 231.7 of the ITA.The appellants argued that the Federal Court did not have the authority to issue the order, because it directly or indirectly ordered theappellant’s law firm to disclose material, contrary to jurisprudence to the effect that 231.7 was of no force and effect in so far as it relatedto lawyers and notaries.

The Federal Court of Appeal rejected this argument, holding that the order was directed only against theappellant, not its lawyers. [92] In expressing this conclusion, Justice Stratas stated that the order required the appellant to disclose all documents in its power,possession and control, wherever located. However, this statement related to the conclusion that the order applied only to the appellant.

Itdoes not represent a finding that the order applied to documents in the appellants’ power, possession and control located outside Canada,as the decision does not indicate that extra-territorial application of the order was an issue before the Court.

[93] The Respondent also relies on R v McKinley Transport Ltd., (SCC), [1990] 1 SCR 627 [McKinley], submittingthat the facts of that case involved information outside Canada that was in the power, possession or control of a person in Canada. TheRespondent notes that the books and record of the Canadian corporate taxpayer were located at the premises of its corporate parent inMichigan.

The Respondent submits that the absence of any suggestion in that case, that s 231(3) of the ITA (the predecessor to the s231.2(1)) could not be used to obtain information from a Canadian taxpayer whose records were in the U.S., supports its position. [94] However, I agree with the Applicants’ response that McKinley did not analyze the issue of the application of s 231(3) to foreign-based information.

That case involved a challenge to that provision under s 8 of the Canadian Charter of Rights and Freedoms.Moreover, it arose out of circumstances that predated the addition to the ITA of the foreign-based information provisions. In my view,McKinley provides no support for the Respondent’s position. [95] Turning to more recent jurisprudence, the Respondent also relies on the decision of the Federal Court of Appeal in eBay.

This caseis closer to addressing the point in issue, as it considered an argument by the appellant, eBay Canada Inc [eBay Canada], that theMinister was unable to require production of information under s 231.2 because the information was located outside Canada and thusconstituted foreign-based information under s 231.6. The Federal Court found, and Federal Court of Appeal affirmed, that the Ministerwas not required to resort to s 231.6, notwithstanding that the required information was stored on computer services located outsideCanada.

The Respondent refers in particular to paragraphs 50 to 53 of this decision, which the Respondent submits demonstrates theFederal Court of Appeal relying on a conclusion that the information was within eBay Canada’s power, possession and control. [96] Again, I disagree that this authority supports the Respondent’s position. The result in eBay turned on the Federal Court’s finding,affirmed by the Federal Court of Appeal, that the relevant information was located in Canada, because eBay Canada was able to access itfrom its computers in Canada.

Indeed, the Federal Court of Appeal concludes its analysis by stating that, because the facts of that casedid not engage s 231.6, it was unnecessary to consider whether the presence of that

section in the statutory scheme reduced the Minister’spowers under s 231.2 when the requirement related to foreign-based information (at para 53). I read this statement as expresslyconfirming that the Court was not addressing the proposition the Respondent is advancing in the present case. [97] At the hearing, I asked counsel to address R v Pierlot, (PE SCAD), [1994] 1 CTC 134 [Pierlot] and its relevanceto this issue.

In that case, the Prince Edward Island Supreme Court, Appeal Division considered the appellant’s appeal from hisconviction for failing to comply with a requirement issued under s 231.2(1) of the ITA, requesting information including the name andaddress of any estate that provided funds to him as an inheritance.

The appellant took the position that, as such funds were inherited fromfamily estates in Belgium, the requested information was foreign-based and the Minister was required to resort to s 231.6 to obtain it. [98] In dismissing the appeal, the Court concluded that, although the names and addresses of the estates could be classified as foreign-based information under s 231.6, it could equally well be requested under s 231.2(1), because it was far-fetched to believe that theappellant would receive these funds and not know details as to their source.

In other words, the Minister was only asking the appellantfor something that he has. [99] With the benefit of the parties’ respective submissions on Pierlot, I conclude that it does not assist the Respondent. It does not standfor the proposition advanced by the Respondent that the Minister can obtain foreign-based information through a requirement issuedunder s 231.2, provided it is in the possession, power or control of the recipient of the requirement. Rather, somewhat like eBay, this caseturned on a factual determination that the relevant information was available to the recipient in Canada.

In other words, these authoritiessupport the conclusion only that, if foreign-based information is also located in Canada, it can be compelled under s 231.2 by virtue of itsCanadian location.

They do not support a conclusion that information which is located only outside Canada can be compelled under s231.2 because it is within the power, possession or control of the recipient of the requirement. [100] Taking into account the parties’ respective arguments on the point, the Respondent has not convinced me that the statutoryscheme of the ITA permits the Minister to require production of foreign-based information through s 231.2(1).

However, my role is notto arrive at a definitive conclusion on this point, and I need not do so in order to decide these applications for judicial review, as anotherargument advanced by the Respondent (canvassed next in these Reasons) satisfies me as to the reasonableness of the decisions to issuethe RFIs without recourse to s 231.6.

(3) Uncertainty as to Location of Requested Information [101] The record before the decision-maker and now before the Court does not indicate where the requested material is actually located.However, the Respondent acknowledges that some of the information sought in the RFIs may be located outside Canada and that theInformation Sheets that were before the decision-maker reflect this possibility.

The Respondent submits that the possibility the materialmay be outside Canada does not translate into a conclusion that the Minister must resort to s 231.6 to request the information and that theRFIs issued under s 231.2(1) are therefore invalid.

Indeed, the record indicates that, in contemplation of this possibility, the Minister hasissued separate requirements under both s 231.2 and 231.6 in relation to this information (although only the s 231.2 requirements are thesubject of the present applications for judicial review). [102] In response, the Applicants take the position that the weight of the evidence before the decision-maker suggests that theinformation being requested is foreign-based and that the decision-maker had no evidentiary foundation for a conclusion that theinformation was located in Canada.

The Applicants argue that it was therefore unreasonable for the decision-maker to seek theinformation under s 231.2 rather than s 231.6. [103] I accept that there was information before the decision-maker that supports the Applicants’ assertion that the information isforeign-based. The Applicants rely in part on the foreign locations of incorporation and operation of various entities that are the subjectof the RFIs. The Information Sheets also contain some evidence that speaks to the possible location of the information anddocumentation sought.

For instance, the Gherfam Information Sheet notes that the taxpayer’s representative has previously indicated thatthe Mall of America (the refinancing of which the Gherfam RFI relates to) is located in the United States, that the accounting for thatentity is performed there, and that the documents supporting the accounting for the Mall of America are not maintained in Canada.Similarly, the Ghermezian and Vaturi Information Sheet indicates that some of the information supporting the Triple Five RFIs and

Gibraltar RFIs was provided by

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