Proceedings of the Standing Senate Committee on National Finance
Issue 8 - Evidence
OTTAWA, Tuesday, June 10, 2003
The Standing Senate Committee on National Finance, to which was referred Bill C-28, to implement certain provisions of the budget tabled in Parliament on February 18, 2003, met this day at 9:34 a.m. to give consideration to the bill.
Senator Lowell Murray (Chairman) in the Chair.
[English]
The Chairman: I call the meeting to order. We have before us Bill C-28 in respect of the proposed budget implementation act, 2003. As honourable senators are aware, this is a typical omnibus bill that contains 130 clauses more than 132 pages. The bill covers every imaginable subject examined in the budget. Most of these issues, although not all, are covered in the Main Estimates 2003-04 that we have had before us now for some weeks. The committee will meet again tomorrow to hear from officials from the Department of Finance. If all goes well, we could proceed to clause-by-clause study of the bill at that time.
There is one provision in Bill C-28 that has attracted attention and on which a number of witnesses have asked to be heard.
[Translation]
These are amendments to the Excise Tax Act. They deal specifically with clause 64, on page 54, of Part VII of the bill. Part VII concerns reimbursement of the Goods and Services Tax paid to private transportation companies for school transportation. The problem revolves around retroactive legislation and the fact that a judgment was overturned.
[English]
We have several sets of witnesses on this matter. One individual, who will not testify before the committee, has been particularly interested in this issue and has expressed his concern in writing to the committee. I extend a warm welcome back to Parliament Hill to the Honourable Marc Lalonde, former Minister of Finance. Welcome, Mr. Lalonde, it is a pleasure to have you here today. We read your brief with great interest.
[Translation]
From the Quebec School Boards Federation, we will be hearing first from Mr. Roger Tassé. He is well known on Parliament Hill for having been, among other things, deputy minister of Justice between 1977 and 1985. He was also a constitutional adviser to a number of federal governments and prime ministers; he is a member of the Order of Canada and was one of the drafters of the Charter of Rights and Freedoms.
[English]
Mr. Roger Tassé has a luminous reputation in this place. Welcome, Mr. Tassé, please proceed.
[Translation]
Mr. Roger Tassé, as an individual: Thank you, Mr. Chairman, for those words of welcome. I am pleased to be appearing before your committee. I will begin by trying to outline our principal areas of disagreement with the proposal that you have before you from the Minister of Finance. This proposal would amend the Excise Tax Act. It applies to school boards and school transportation.
Although the facts are rather complex, the issue before you is quite simple. It is important, however, to have a good understanding of what has happened since 1996 in the Des Chênes case and other related cases.
I do not intend to go into detail about the use of retroactive legislation. We agree that there are situations, especially in taxation areas, where it is appropriate for Parliament to make laws retroactive. And that is what the minister is proposing Parliament do in this case. What we object to is how these principles are being applied to the facts. That is why we consider the facts to be extremely important.
I will present only the main facts. There was a first group of school boards that were covered by the Des Chênes case. In 1996, a few years after the 1991 Excise Tax Act came into force, 29 school boards decided to submit claims. Their legal counsel indicated that it was possible to claim a full reimbursement, rather than a partial one, of costs related to school transportation. As a result, those school boards filed claims for reimbursement, which were rejected by the department.
Senator Bolduc: Are we talking about transportation for their own students?
Mr. Tassé: Yes. Legal proceedings were initiated and followed their course. The 29 school boards consolidated behind the leading Des Chênes case. The question was raised as to whether each case should be heard or only Des Chênes. Following considerable debate before the Tax Court of Canada, the judge decided that the same facts and points of law were at issue and therefore the cases should be filed simultaneously. However, in order to simplify proceedings, only the Des Chênes case was heard. That is why it became the leading case.
The cases were first heard in 1999 by the Tax Court of Canada, which decided in favour of the government. The case was then appealed to the Federal Court of Appeal on October 17, 2001. The Court of Appeal ruled in favour of the school board rather than the department. The 29 school boards, represented by the Des Chênes case, won their case and were reimbursed.
Those facts are relevant to the question before us. The department has proposed that these cases be exempted from the amendment to the Excise Tax Act that would be retroactive to the date in 1990 when the act came into force. That is important to note. They acknowledged that it was fair and reasonable to make that exception. They should have gone further, however, and extended the exemption.
There is a second group of school board cases that includes school boards from Quebec. Of the 19 Quebec school boards in this second group, 18 are also part of the first group. Those school boards continued to file reimbursement claims following the proceedings that led to the Des Chênes ruling and the decisions already mentioned. Those claims were filed between 1997 and 2001.
This second group also includes school boards from Ontario. However, the school boards that took action, by filing claims and submitting their position to the Tax Court of Canada to ensure that their cases were prepared, were the Ontario school boards and the 19th school board from Quebec in the second group.
Since the number of cases pending before the Tax Court of Canada was increasing, the Crown's lawyers decided that, rather than proceeding with all these cases, it would be best to suspend them pending judgment in the Des Chênes case, which was decided on October 17, 2001.
The cases in the second group were submitted, ready to be dealt with by the Canadian Tax Court, before the ruling by the Federal Court of Appeal but were suspended because of the agreement reached by counsel on both sides.
When the ruling in the Des Chênes case was handed down in October 2001, the school boards in the second group filed, through their legal counsel, a motion in court asking that judgment be rendered on the basis of the Des Chênes case. The lawyers indicated to the Tax Court of Canada that they wanted it to rule on the cases, since the position of the Federal Court of Appeal on the particular point of law was now known.
Counsel for the department objected to this motion from the school boards' lawyers. He claimed that new facts prevented the court from proceeding and that the case had to be heard on its own merits, with arguments about the facts and the point of law, as if the Des Chênes ruling did not exist. The Tax Court of Canada responded to the objection from Crown counsel by agreeing to dismiss the motion. The school boards then decided to appeal the decision to the Federal Court of Appeal.
Those are important points. We asked for a hearing before the Tax Court of Canada, which was set for December 19, 2002. The second group of cases was scheduled to be heard by the Tax Court of Canada in March 2003. On December 13, six days prior to the hearing before the Federal Court of Appeal, counsel for the department transmitted an offer to the school boards. The offer said that if we withdrew our appeal concerning the new facts, they would be prepared to consent to judgment, as in Des Chênes.
The reason for that proposal is presumably that the facts and points of law are the same. For the Quebec cases, the parties and legal counsel were the same as well. The offer was conditional on the school boards withdrawing their motion before the Federal Court of Appeal concerning new facts.
The offer was accepted, consent to judgment was brought before the Tax Court of Canada and a final decision was handed down on January 29, 2003, before the February budget.
Where the Ontario cases were concerned, the department suspended its position in January 2003 before the Tax Court of Canada in order to check whether the Ontario Education Act was similar to the Quebec legislation. If so and if the facts were substantially the same, the department would take the same position on the Ontario cases.
To date, consent to judgment and a final decision have been applied in nearly all the Ontario school board cases; under the agreement that the facts have to be substantially the same, the same process would be followed. The second group, which includes both Quebec and Ontario cases, is not eligible for the exemption being proposed by the government, which indicated that only the first group would be exempted from the retroactivity rule.
The reimbursements were made on the basis of the Tax Court of Canada decisions. As I indicated, however, the retroactivity rule applies fully to the second group, which includes the Quebec and Ontario cases. No reimbursements have been awarded, as if the other proceedings had never taken place. I would again remind you that the same parties are represented in both groups, in the case of the Quebec school boards.
Why would the exemption allowed by the government to the retroactivity rule not apply to the second group? The facts are the same. The proceedings show that very similar wording is used in both cases. The school boards' claims and the legal counsel's arguments are largely the same. The points of law are the same for both groups of cases.
Moreover, the cases were launched by each school board in the second group in a timely manner, that is, before the Federal Court of Appeal ruling was handed down. The parties wanted to have their claims heard and an agreement was reached by legal counsel on both sides to suspend the hearings until the Des Chênes decision was rendered. These cases were ready to be heard before October 17, 2001. Why suspend them unless to await the Des Chênes ruling in order to determine the legal rule to be applied?
It is also significant that consent to judgment was offered by the Crown counsel. They took the initiative to contact the counsel for the second group of school boards and propose that the appeal on the new grounds be withdrawn in return for a consent to judgment, and final decisions were handed down as a result. Why propose consent to judgment if there was no intention to follow through?
The real question is whether the government acted in good faith between 1996 and 2001. The reimbursement claims were filed beginning in 1996. The government could have indicated, as it is claiming today, that the provision is clear and that it permits only a partial rather than a full reimbursement. Why not introduce an amendment right away?
Instead, they agreed to undertake a legal process that would last several years, and they assumed that the courts would eventually rule in favour of the government. Unfortunately, that was not what happened. The Federal Court of Appeal came down in favour of the taxpayer.
The government is arguing that, a few months after the Federal Court ruling, on December 21, 2001, it announced that amendments to the act would be proposed.
The decision was handed down on October 17, 2001. On December 10, 2001, when the budget was introduced, there was no mention of such amendments. However, a press release announced that the government intended to bring in changes. During the course of 2002, the December 10th budget was debated but the intended amendments were never brought up. It was not until 15 months later, in the February 2003 budget, that the amendment was proposed.
One wonders, in view of the 2001 press release, whether the school boards, on the basis of the Federal Court ruling and the consent to judgment, should not have dropped their cases, since the minister had indicated that he intended to introduce amendments.
The minister might have changed his mind, however. The government could decide to do something else. Is it reasonable to claim today that the school boards knew since 2001 that the government was intending to bring in changes? It is impossible to argue both ways.
When there is an intention to do something in a timely manner, it is important not to delay, allow lawyers to argue before the courts, consent to judgments and then say: we lost in court, so we will amend the law so that we win anyway. I do not feel that this approach is fair.
I would therefore suggest that your committee should look into the possibility of recommending that this exemption to the retroactivity rule be extended to these cases. I am not saying that the retroactivity rule is unreasonable. It would continue to apply to these school boards, even with an amendment to exempt the second group of cases. For the future, beginning in 2001, the retroactivity rule would prevent the school boards in both groups from filing further claims.
I think that this is a reasonable suggestion. The retroactivity rule is justified in these situations. However, if Parliament agrees to amend the act without including the second group, it would be condoning to a certain extent what happened in this legal saga, with its many twists and turns.
The Chairman: We only have about 20 minutes before hearing the other witnesses on this subject. However, Mr. Yves St-Cyr, legal counsel for the Quebec Federation of School Boards, wishes to table a document with the committee.
Mr. Yves St-Cyr, legal counsel, Quebec School Board Federation: These are diagrams that make it easier to understand the chronology we are talking about, with respect to both the Quebec and Ontario school boards. The material is in both English and French, if you would like to distribute it to the committee members.
The Chairman: We will now go to questions.
Senator Bolduc: If I understand correctly, Mr. Tassé, the central issue is whether the government keeps its promises. We need to decide whether the agreement made by the legal counsel between 1997 and 2001 is binding, for all practical purposes, on the Minister of Finance and whether the resulting legislation can be retroactive. We know that budgets are always retroactive, since they are tabled on a given date and voted on up to a year and a half later.
So we need to know whether the consent granted by the lawyers to the second group of school boards between 1997 and 2001 is binding on the government. If not, do you have an amendment to propose?
Mr. Tassé: To answer your question, we are of the opinion that this agreement is indeed binding on the government. That commitment was even recognized by the consents to judgment.
On the other hand, we understand that Parliament is supreme, that it can go against court rulings in these cases. Parliament has a responsibility to ensure that fundamental values are recognized and that there is effective compliance with court decisions.
Senator Bolduc: In other words, the same is true for the budget.
Mr. Tassé: I could provide you with some wording for an amendment to correct the situation.
Senator Bolduc: So your focus is the second group and not a third group of school boards that are not involved in this.
Mr. Tassé: Other school boards did not act in time to have their claims considered.
Mr. St-Cyr: We are only talking about the Quebec and Ontario school boards whose cases were already ruled on by the tax court of Canada as a result of the consent to judgment agreed on by crown counsel.
Senator Bolduc: This is the law. It has already been granted. We are talking about the second group.
Mr. St-Cyr: I am talking about the second group. The federal Court of appeal ruled with respect to the first group. The second group includes Quebec school boards whose cases were ruled on as a result of the consent to judgment. The Ontario school boards in that group are in the same situation.
The Chairman: Mr. Tassé has tabled a proposed amendment.
Mr. Tassé: I sent a letter to Mr. Paquette in the other place and, on page 2 of that letter, I suggested an approach that would treat the school boards in the second group in a fair and reasonable manner. I suggest that subclause 64(2) of Bill C-28 be amended. It currently reads as follows:
(2) Subsection (1) is deemed to have come into force on December 17, 1990.
I would add: With the exception of those cases for which the crown attorneys are bringing consents to judgment before the appropriate court.
This would be very limited. These would be cases where there has been a consent to judgment.
Senator Bolduc: It would confirm that the Minister of Finance is bound by the decision made by his attorneys.
Mr. Tassé: That the Minister of Finance should respect the decisions made by the attorneys that resulted in court judgments. Accordingly, he would respect the consents to judgments.
Senator Bolduc: That would make the third paragraph disappear.
Mr. Tassé: Right.
The Chairman: Mr. Tassé sent a letter to Ms. Sue Barnes, who is the chair of the House of Commons Standing Committee on Finance.
[English]
It is suggested in the letter that following subclause 2, which reads: "(2) Subsection (1) is deemed to have come into force on December 17, 1990," the following words be added: "except for those cases in which the lawyers representing Her Majesty the Queen have agreed to file consents to judgment before the appropriate court."
Do all of you have that?
[Translation]
Senator Beaudoin: Your logic stands up very well. It is true that, in theory, the res judicata applies to the parties in a case before a certain court, but once the judgment has been rendered, a principle of law is created. This principle of law, if taken into account along with other facts that are the same and which occur at nearly the same period or for a portion of that time period, because there was some interaction between the two courts of justice and we must never forget this, is adequate as far as I am concerned, legally speaking. Since we already have a very clear judgment from an appeal court, Parliament would be very ill-advised to reach a different conclusion because the second group is involved rather than the first one.
In other words, the problem lies in the similarity of the facts. If the facts are similar and the decision has been rendered, it would really bother me if we did not apply exactly the same principles. I accept that. As the legislative branch of the State, it would not be advisable to go against decisions rendered by a court. As far as this is concerned, I do not see any difficulties. However, when it comes to the retroactivity of the law, that is another matter.
Laws can be retroactive in taxation matters. The budget is a classic case. For the second group, we have to legislate the way we did for the first, given the decision made in the Des Chênes case. I do not have any problem with that. The retroactivity rule, which is only partial, does not bother me at all. You have not mentioned this aspect at all as far as the third group is concerned.
Mr. Tassé: The third group comprises all of the other school boards that did not take timely action and even the school boards from the first and second group, for the time periods following the federal appeal court decision. In other words, the school boards that did not have a judgment and that were filing a motion for the period following the 2001-2002 judgment would be subject to the retroactivity rule. You are right in saying that this is a partial application of the exemption to the retroactivity act.
The retroactivity rule applies to very specific cases such as the cases included in the first group where there was a judgment. After reviewing the facts — they are the same facts, the same points of law — I do not understand why the attorneys consents did not comply with the recognized principle. The government recognized that the retroactivity rule should not apply to the first group. Why to the second?
Senator Beaudoin: In other words, when you have the same facts, you apply the same principles of law. That is enough for me.
Mr. St-Cyr: When we talk about the second group of school boards, we are referring to the second group of school boards from Quebec and Ontario. More specifically, these school boards — I want to be clear — obtained a decision from the Tax Court of Canada further to Her Majesty's consent and this judgment is final, and hence it is binding.
Should the amendment carry, the part of the amendment that results in the school boards not being covered or exempted means that the Minister of Revenue will have to reimburse the school boards in order to carry out the judgment and, with the retroactive amendment, he retains the right to recover this money in a year or a year and a half.
Senator Bolduc: Earlier, I said that this was about determining whether or not the Minister of Finance would agree or, I used another word, but I meant to say respect the consents. Basically, that is the problem.
Mr. St-Cyr: You are right.
The Chairman: Does anyone else wish to speak?
Senator Biron: Do you have an idea how much money is being sought?
Mr. St-Cyr: In the two remaining groups, the second group from Quebec and the Ontario school boards, the total should be approximately $16 million.
Senator Bolduc: Could we take an unusual step, Mr. Chairman?
The Chairman: What would that be, Senator Bolduc?
Senator Bolduc: I was a member of the administration, however not in the same capacity as the former minister of finance here today. I get the feeling that an official from the Department of Finance, under the guise of efficiency or something else, drafted something along the lines of shutting the door to anything that occurred before 1991 so that not everybody would be able to jump on board.
I am sure that our former minister of finance, if he had been the minister when such a situation like that had occurred, would understand that a rule of law applies and that, in all honesty, this does not make good sense.
Senator Comeau: You said that the retroactivity rule is a relatively common procedure. I understand that and we often see this with tax measures.
Nevertheless, I am not convinced that the retroactivity rule can apply to a date prior to the announcement. For instance, if the Minister of Finance were to announce that something would be taxed more heavily, generally speaking this measure would not be retroactive to this date. That is a little bit like the case we have here.
The appeal court rendered its decision in 2001 and stated that school boards would be exempted. The government agreed, but said that it would make a change retroactive to 1991. Is that normal? The government could announce measures that are retroactive to 2001, but to go all the way to 1991! I have never heard of doing anything like that before.
Mr. Tassé: I must confess that I have never heard about such a situation, but it may be useful to ensure that there is not a whole series of applications that could result further to a court decision. I can see the government suggesting amendments to Parliament to ensure that people who have not taken timely action not be allowed to take advantage of a judgment rendered later on. But in our case, that is not what happened.
We are saying that we want the retroactivity rule exemption to apply only to those school boards which applied for reimbursement by the deadline for the same facts, which obtained consents and which were therefore prepared to go to judgment. This is a very restricted number in our case.
Senator Comeau: I understand, but the fact remains that the court of appeal did make a decision and there were exemptions. The government decided to remove this exemption for everyone. If the government manages to establish a retroactivity rule for a prior date, we are perhaps setting a precedent that we may not want to see. If Canadians get the impression that the government can do what it wants and change the laws retroactively, that means that there is a problem.
Mr. St-Cyr: As regards the principle of retroactive legislation, Parliament is sovereign and can make laws retroactive. Moreover, in reality, we must ask ourselves whether or not this has already been done. Indeed, this does occur.
There are more specific situations where Parliament will decide to make a section of an act retroactive, for example, in cases where there will be no consequences with respect to taxpayers' money. Generally speaking, the department's intent is specified when the measure is adopted and the department points out that perhaps it was not clear in the actual section of the act but that it was clear in the technical notes at that time. At this point, Parliament will often amend the provision in question, again going right back to the time when the system was implemented in 1991. This is quite frequent.
Moreover, when rights are concerned, as in this case, it is another matter. Making this case retroactive, for example, by saving the 29 cases that received a favourable decision from the Federal Court of Appeal, is not unusual because the judgment is nonetheless respected. The department decided to abide by the judgment. Shortly after this date, the department decided, in order to prevent any shortfalls in the public purse, to adopt an amendment that applies to all other school boards right up to the time that the system was implemented.
Senator Comeau: For the second group that agreed with the attorneys to wait for the decision, that means that the word of the Government of Canada attorneys is worthless.
Mr. St-Cyr: What is happening now in the cases that we generally deal with in the legal and tax community is that when the departmental lawyers tell us that they will put a case on hold until they hear how the court rules but that they do not feel bound for the other cases, we always say no. That involves extraordinary expenses for the taxpayers.
Senator Comeau: That is finished now.
Mr. St-Cyr: These cases cost Canadian taxpayers a fortune.
Senator Gauthier: Are the facts the same?
Mr. St-Cyr: The facts are the same and the law is the same.
Mr. Tassé: The point of law is the same.
Senator Gauthier: Lawyers have a talent for making things complicated. Mr. Tassé, you have tried to clarify this issue.
Mr. Tassé: But it is complicated!
Senator Gauthier: If I read your amendment, subsection 1 is deemed to have come into force on December 17, 1990, except for cases where the lawyers representing the Crown have agreed to consents to judgment before the appropriate court. This is what Senator Comeau was asking you. The Crown attorneys do represent the Crown after all. They either keep their word or they do not! They made a commitment. Are there any other considerations that we do not understand? It seems to me that it is clear.
Mr. Tassé: I am going to take this opportunity to tell you that, in a letter sent to Mr. St-Cyr, at the time when the consents were given in a case, the attorney said that the department of revenue would do all it could to apply the judgments rendered. But he added that he had to warn us that the minister had already given his notice of intent to make amendments and that, should these amendments carry, everything would fall through.
I am wondering why action was not taken in a timely fashion. This could have been in 1996, when school boards started submitting these applications. But the government did not respond, just as it did not respond to the budget of 2001-2002 tabled on December 10, 2001. Nothing indicated that such a change was desired and, 15 months later, an amendment was introduced. Should we criticize the taxpayers for not dropping their case? The court of appeal recognized that they had rights.
Furthermore, I have the impression that the administration, in this saga which went on from 1996 to 2003, wanted to take the legal route with the idea that, should it win, the whole matter would be dropped and, should it lose, it could always then take the legislative route.
Under the circumstances, I find it unacceptable to ask Parliament to allow the government to take the legislative route and change what had been decided by the court with the consent of the attorneys. In my opinion, this is a violation of one of the fundamental values of our country, namely, respect for court decisions.
Senator Gauthier: May I have a copy of this letter?
Mr. Tassé: Yes.
[English]
Senator Day: If I understand the facts correctly, the GST reimbursement to the school boards, which began in 1991, was about 68 per cent. Then the school boards were advised that they could receive 100 per cent, so they decided to file a re-assessment. If they did not get that, they would go to court. In 1997, a group of school boards went to the tax court. As it turned out, this process of appeals and an attempt to get the difference between 68 per cent and 100 per cent reimbursement brought about a group that became known as the Des Chênes School Board group, comprising 29 school boards.
Did the others have their appeal submitted as well?
Mr. St-Cyr: Yes, some of them did and some did not. We were unable to submit these appeals for a hearing because not all of the cases were ready to be heard.
Senator Day: Why were all the pending cases not together?
Mr. St-Cyr: We would have liked to do it that way, but the first 29 cases were ready for court and we proceeded. We began the process with that group while the other appeal cases prepared. Each week we received defences from the ministry. The other cases were not ready to go to court yet. Consequently, after the first 29 cases were heard, we decided to suspend the others. That is how it usually works in court when there are many similar cases.
Mr. Tassé: With their consent.
Mr. St-Cyr: We had 200 cases before the Tax Court of Canada. They were overloaded with these cases. Therefore, we suspended them to await first, the decision of the Tax Court of Canada and second, the decision of the Federal Court of Appeal.
Senator Day: In the matter of the Des Chênes case, the Federal Court of Appeal made a decision and then the Crown had to decide whether to take it to the Supreme Court of Canada. You were still waiting.
Mr. St-Cyr: Yes, we waited until the end of December.
Senator Day: On December 21, 2001, or sometime in late December, the Crown decided that they would not appeal the decision of the Federal Court of Appeal of October 21, 2001. On December 21, shortly after the Crown decided not to proceed, the minister made an announcement that the House would pass legislation to clarify this and to make it retroactive to 1991, when the GST came in. The minister said that he would try to clarify the law to ensure that that would be the case.
Mr. St-Cyr: Yes.
Senator Day: That happened in December 2001. In January, less than one month later, the lawyers for the school board of group number two went before the Tax Court of Canada and said that, based on the Des Chênes decision, they would like to have the same judgment. Is that correct?
Mr. St-Cyr: Yes.
Senator Day: It bothers me that this time there could have been a judgment. Was there any discussion with the judge at that time about the minister's announcement of less than one month earlier?
Mr. St-Cyr: There was some discussion. However, the judge said that it was the law at the time and that he would judge the motion before him in respect of the actual law. Any changes to that law were only proposed and no one knew whether they would go further. Consequently, the tax court did not take these pretensions into account. As well, counsel for the ministry said that they may have some new arguments to present to the court but it was not true.
Senator Day: Mr. St-Cyr, are you telling me that the judge in the Tax Court said that he would not give judgment to group number two based on the Des Chênes decision because officials of the Crown said that they had more facts and, therefore, would have to deal with those other facts.
[Translation]
Mr. St-Cyr: Yes and no. The Crown attorneys referred to a decision of the Quebec Court of Appeal that was further to a decision made by the Federal Court of Appeal. This was the Des Chênes case, which dealt with grants given to public administrations, in this case universities.
This court of appeal decision had absolutely nothing to do with tax issues and stated that the grants were free, whereas the Federal Court of Appeal, in the Des Chênes case, had said that the very direct grants, for transportations were, in accordance with the Excise Tax Act as it was drafted, an exempt supply.
On this basis, the Crown attorneys tried to convince the judge that they allegedly had grounds to bring forward with respect to this new Quebec Court of Appeal decision that was rendered following the Federal Court of Appeal decision. During the judgment on motion, the judge simply said that he would not rule on the substance and that he could not accept the motion, despite the fact that the Crown was claiming that it could have put forward grounds that it had not presented at the time because the decision had not yet been rendered by the Quebec Court of Appeal.
[English]
Senator Day: Mr. Chairman, I think it is important that I continue so that chronology of events is complete. We are now at the stage where group number 2 asked for judgment based on the decision for group number one. The Tax Court said no and the group went to the Federal Court of Appeal. However, there was a settlement before the case was heard.
Mr. St-Cyr: Yes, there was a settlement from the Crown.
Senator Day: The settlement was based on an exchange of letters, of which we have copies. I will not read through the letters but the first one is from the Department of Justice to Messrs. Ogilvie and Renaud, and to Maitre Yves St- Cyr. Mr. St-Cyr, you were involved in the case and in the settlement. The letter from the Department of Justice, according to our understanding, said that the proposed amendment would have no effect on the cases that have been decided — in other words the Des Chênes cases — at the date of the press releases but — and this is the minister's announcement — will apply to all other proceedings. That means that they may apply to your proceedings or may potentially apply to your proceedings. Do I understand that correctly?
Mr. St-Cyr: I have the letter in French.
Senator Day: This letter was dated December 13.
Mr. St-Cyr: The original letter was written in French.
Senator Day: With my apologies, you are correct. The English version is marked as a translated document. It was dated December 13.
Mr. St-Cyr: Have you read the letter dated December 16?
Senator Day: That one said: "We understand that this settlement is binding notwithstanding whether the retroactive amendments were announced on December 21, 2001."
Mr. St-Cyr, you are saying that, notwithstanding this, the announcement will not apply to group number two. The letter of December 16 was sent and the ministry said it did not understand that paragraph because it had been clearly stated that the announcement would potentially affect group number 2. That is my understanding of that exchange of letters.
My question is: When the settlement was reached, was it clear to you that group number two could be affected by the minister's announcement of December 21, 2001?
[Translation]
Mr. St-Cyr: This was not any clearer than if it had not been mentioned. The department could have amended the act. This amendment was already pending. We received a consent to judgement from the Crown attorneys on December 13. Should I accept or refuse a consent from the Crown in a decision which would result in my client winning his case? These are quite extraordinary situations.
I wrote a letter telling the department that we agreed to the consent and that we understood that everything would work out well. We received a letter stating that, considering the wording of the press release issued by the Department of Finance on December 21, it was possible that the retroactivity amendment pertaining to the relevant provisions would have an impact on the present cases, notwithstanding the Tax Court of Canada decisions. In other words, the Crown attorneys were telling us: we will give you the money, but we may not abide by the tax court decision and we are going to have to take the money back. This seemed quite incredible to me.
Senator Bolduc: This is an abuse of power.
Mr. St-Cyr: That is clear.
Senator Bolduc: I can accept the Minister of Finance talking when he tables his budget. Everybody understands that. The minister stands up in the evening and he talks about the stock market and all kinds of things. But it is not just any letter that arrives any time that changes decisions. The letter of the 16th does not make sense. The same government cannot talk from both sides of the mouth even if this comes from the Minister of Finance, for whom I have a great deal of respect. It is clear that this is an abuse of power.
Mr. St-Cyr: When you tell a taxpayer that you will consent to a judgement in a case and you are the person in power, in authority, and you also tell him: we do not know, perhaps... I telephoned the Department of Justice and I asked them the following question: Do you know something that I do not know? Will the amendment carry or not? They told me that they did not know what the Department of Finance was doing. So the right hand does not know what the left hand is doing. That is how taxpayers' files are being managed.
Mr. Tassé: They know that there has been notice of intent, and that they must take appropriate action.
Mr. St-Cyr: When there has been a notice of intent, when cases are ready to go ahead and the agreement with prosecutors has been suspended, taxpayers would have to be asked to withdraw their cases from the Tax Court of Canada and risk never having the amendment passed. And you are trying to tell me that in Canada, legislation is made through press releases from the Department of Finance.
[English]
Senator Day: Can you tell me if you had any correspondence after the letter to you dated December 16, which says, "On the basis of the Minister of Finance press release of December 21, 2001, the possibility remains that the retroactive amendment to the relevant provisions would have an effect on these proceedings, notwithstanding the judgments of the tax court. In that event, the present settlement will not constitute a constraint on the power of the Minister of National Revenue to reassess in accordance with the terms of any retroactive amendment." What was your reply to that?
Mr. St-Cyr: What date is that?
Senator Day: That is the Department of Justice letter to you of December 16, 2002. If you thought it made no sense, what did you say?
Mr. Tassé: Senator Day, what was the date of that letter?
Senator Day: December 16, 2002.
[Translation]
It is dated December 16, 2002. I have the letter in English, but I think it must have been written in French.
Mr. Tassé: Yes, it was written in French.
Senator Day: The original was written in French.
Mr. St-Cyr: There is a sentence in the letter dated December 16 that you did not read. It is in the second paragraph on page 2; I will read it in French. It states that the Minister of National Revenue intends to respect the decisions of the Tax Court of Canada and act promptly in order to follow up on them. I did not answer the letter, and they signed the consents to judgment.
Senator Day: Could you read the last paragraph, please?
Mr. St-Cyr: You have read it yourself. That is what it says there. I cannot tell you what is not in there.
Senator Day: The paragraph is there in French as well.
Senator Bolduc: But it does not make sense. You can see, as I do, that it does not make sense.
Senator Day: But the document was signed with this letter anyway.
Senator Bolduc: The court has ruled, and the Department of Justice counsel says that it may apply the ruling. It does not make sense.
Senator Day: I understand this is a legal case.
[English]
The Chairman: Thank you, Mr. Tassé and Mr. St-Cyr.
We will invite the representatives of the Canadian Bar and the Quebec bar to come to the table now. Perhaps they can all help to shed some light on this discussion, where there has been some heat.
Before we hear from the next witnesses, colleagues, I have a very pleasant duty to perform, and that is to welcome to our committee hearing this morning a delegation from the National Assembly of the Republic of Serbia. They are visiting Canada this week under the Parliamentary Centres Southeast Europe Parliamentary Program, which is a CIDA-funded project. In particular, they are studying our parliamentary participation in the budget process, parliamentary monitoring of government expenditures, and human resources development and strategic planning, particularly to support activities that will help to strengthen parliamentary accountability and oversight.
Senator Comeau: — and good governance.
The Chairman: I accept that amendment, senator. I would ask the deputy speaker of the Serbian Assembly, Madam Gordana Comic, and the other members of the delegation, please, to stand. Thank you very much. We extend a warm welcome to you. We hope that your visit will be useful and that it will strengthen the links between our countries, and particularly among parliamentarians in our two countries. Welcome.
Senators, on this same subject that we were discussing with Mr. Tassé and Mr. St-Cyr a few moments ago, we have representatives of the Quebec Bar Association and the Canadian Bar Association.
[Translation]
We will begin with representatives from the Quebec Bar Association, starting with Mr. Claude Desaulniers, Chair of the Legislation and Fiscal Administration Committee, and Marc Sauvé, secretary of the committee.
Mr. Marc Sauvé, Secretary, Legislation and Fiscal Administration Committee, Quebec Bar Association: I am a legal counsel with the Quebec Bar Association. With me today is a young man who has been practising tax law for several years — just over 35, in fact. The Quebec Bar Association has a social mission, which includes defending the rule of law and supporting the authority of the courts and the credibility of the judicial process. Here, unfortunately, is a bill that in our opinion will discredit the judicial process and undermine taxpayer confidence in public institutions and the courts.
On April 7, 2003, the Quebec Bar Association wrote to the Minister of Justice, and forwarded a copy of the letter to John Manley, the Minister of Finance. I believe that you have a copy of this letter. Mr. Desaulniers will now talk to you in greater depth about the issues involved.
Mr. Claude P. Desaulniers, Chair, Legislation and Fiscal Administration Committee, Quebec Bar Association: I will not go back over the facts so eloquently dealt with by Mr. Tassé. If we set aside the point of law, the facts set out are in my opinion quite sufficient to justify Mr. Tassé's conclusion.
I would like to give you the comments of an experienced tax litigator. I have been working in tax litigation for 37 years, and plead before both Canadian and Quebec courts. I will give an outline of the current context. As you know, our taxation system is based on self-assessment. The primary principle of our system is that taxpayers assess their own taxes. The second principle is that the burden of proof is on taxpayers in their dealings with government authorities and the courts. The third principle is that this legislation is extremely complex.
As a former assessor, and someone who was very closely involved in drafting a number of tax statutes, including Quebec's Taxation Act, I can say that this legislation is highly technical. I would even say that we have lost control in drafting tax legislation.
Let me give you some background. In 1985, we passed an number of anti-avoidance provisions for the Taxation Act, which are also in the Excise Tax Act. Under these anti-avoidance provisions, even if you are in compliance with sections 1 and 2 of the Taxation Act and the minister considered that your transaction departed from the spirit of the act, he can redefine the rules governing your transaction. So that is the backdrop against which school boards are submitting claims to the tax authorities.
You may remember a case that was before the Supreme Court in the early 1990s. It led to the reimbursement of some $2 billion or $3 billion, the highest amount of taxes ever reimbursed. In view of this, the Auditor General strongly recommended the implementation of a system that would detect problems of this nature before the courts became involved. The goal was to prevent situations where a taxpayer would have to go to the Supreme Court and then be forced to reimburse amounts not provided for in the finance department budget.
The government responded to the Auditor General's report by referring the problem to the Standing Committee on Public Accounts. The committee made a number of recommendations. In 1995 — if my memory serves me — the government responded to the standing committee's report.
In its report, the government stated that it had established an extraordinary risk management system. The system was designed to ensure that the Supreme Court would no longer catch it unawares. There had to be measures in place to detect problems from the very start, and avoid ending up in court.
Then, we saw school boards submitting claims. I presume that the school boards first requested opinions from their legal counsel. Counsel replied that the school board had a case to take to court. I presume that the departments of justice and revenue also asked for a legal opinion. Their counsel must have told them there was a risk involved.
So if there was a risk involved, and if we had established a system to prevent exactly his kind of situation, why choose the legal procedures rather than an immediate amendment? That is the first question, and the first result. If you undertake a legal process rather than proceed by amendment, you have to accept the consequences of that choice. We have already talked about this, and it goes without saying.
In its response, the government also stated that in certain cases, it might be best to use a test case. Allow me to read a few lines of the report.
[English]
When issues involving groups are not resolved at the objection stage, a limited number of objections (test cases) are selected to proceed to court after consultations with the taxpayers involved in the group and the Department of Justice. The final and binding court decision is then applied to all other objections in that group.
[Translation]
This was said by the government.
We know what the normal practice is. I have already been involved in a series of cases involving 192 taxpayers. We could not plead before the court for all taxpayers, for the same reason. Legal costs were expected to amount to $40,000 or $50,000. We decided to proceed with a single case, with all other taxpayers involved sharing the costs.
What we have in the present case is one person chosen to go before the court. He won the case. However, it is just too bad for all the others who had to pay the costs.
That is exactly what we are seeing today. I think we are seeing this practice more and more. This is not the first time this has happened within the federal government. It looks even worse when we consider the preceding case, the one we are talking about today, which flowed from a ruling of the Federal Court of Appeal in April 2001. We are not talking about last century. The court of appeal ruling declared that regulations issued pursuant to section 59.3(2) of the Excise Tax Act in connection with bar supplies were ultra vires.
The court told the government it had five months to amend the regulations. Amending the regulations takes less time than amending the act. In September or October 2001 — two months before the statement of December 21 — the government had not amended its regulations on bar supplies, but rather the act itself, to have the regulations enter into force retroactively.
Thus, the regulations' enabling legislation was amended retroactively, since the regulations themselves were ultra vires. Regulations covering bar supplies thus became retroactively valid. Validity was retroactive to November 10, 1986.
To my mind this is a very dangerous approach. I will not say anything about what the provinces are doing. However, for school supplies, Quebec has done the same thing. It has also done the same thing for another series of cases concerning municipalities.
In response to the point made by Senator Bolduc, counsel were given a mandate by their client in this case. They are the agents of the government. They have given consent to judgment, and when they do so, the government consents to judgment. How can the government on one hand give consent to judgment and on the other hand prepare a declaratory amendment?
The entire tax system is based on taxpayer confidence in our institutions. It is based on confidence that tax returns will be followed up by payments in compliance with the legislation; if a taxpayer is not in agreement with a given assessment, there is an administrative process to contest the assessment, with a charter to protect his rights. If the system fails at the end of the line, the taxpayer can go to the courts and rely on the ruling rendered, whether it is in his favour or not.
The concern of the Quebec Bar Association is that this confidence is being seriously undermined. What worries me as a practising attorney is that our practice is being undermined. The next time I go to court with 192 cases in a class action suit, I may be forced to file 192 separate cases. The court will not accept that.
Taxpayers have every right to expect that they can no longer be gouged at the mercy of the authorities, as they could in the Middle Ages. They have a right to institutions that allow them to receive what the courts have granted to them.
[English]
The Chairman: I will now invite Mr. Simon Potter, the President of the Canadian Bar Association, to give his presentation.
[Translation]
Mr. Simon Potter, President, Canadian Bar Association: It is an honour to be here with you today and to explain a principle that the Canadian Bar Association considers extremely important.
[English]
The Canadian Bar Association speaks for about 38,000 lawyers across Canada. The reason their president is here today — rather than the president of the national commodity tax section — is that the issues raised here go well beyond tax. They cover issues in all fields of law. You are speaking of tax today, but my message to you will be that the precedent of this legislation means that the issue that you are looking at is an issue that will come back in some other field of law tomorrow. I hope to convince you that that precedent is something that you will not want to see come back.
[Translation]
I believe you have already received the letter dated April 24, which our association sent to the honourable ministers of finance and justice.
[English]
I will not read it. I will cover the major points of it. At issue here is respect for the law, the actual operation of the law, and, of course, simple questions of outright fairness as was brought out so well by senators Beaudoin and Bolduc.
On the question of respect for the law, there are three points that I would like to point out for you, and for those who are actually looking at my letter, they appear more or less in the third paragraph on page 2.
The three points are these: First, we hardly encourage respect for the law among our citizens if we say that the citizens must follow the law but the government does not.
Second, we hardly encourage respect for the law if we say that the government may rely on ex post facto retroactive adjustments to make the law read the way the government thinks it would have been nice for it to read.
Third, and worse, we hardly encourage respect for the law if we allow the government, in a dispute with a citizen as to what the law is, to try its luck in court, and then, if things do not go the government's way, to get its way anyway. What is the point of going to court if that is what we allow? That is so whether we are talking in tax, whether we are talking misleading advertising under the Competition Act, or whether we are talking labelling before the Canadian Food Inspection Agency. It is so across the board. It is a precedent that, I submit to you, is dangerous in the extreme.
On the question of the simple operation of the law — and this is so especially for colleagues of mine such as Claude Desaulniers, who work in tax, but it is the same for me working in other fields of law — we cannot advise our clients on the basis of what we think the administration will ask the law to read retroactively 13 years from now. We can only advise our clients on the basis of what we think the law is actually today, just as in this case the judge who heard the case was told that maybe an amendment would come, and maybe it would be retroactive, and he quite correctly said, "Well, I am afraid I have no choice. I must render judgment according to what the law is today." That is the way the law works, and that is the way the law should work.
In the GST context, there are two other issues to consider: one is that this tax is a transaction-based tax. People enter into those transactions, each one of them, on the basis of their expected cost and benefit in that transaction. They must, as they enter into the transaction, have some kind of certainty. They must, therefore, consider the cost to them as the law appears to them at that minute. The moment we allow a precedent that will throw doubt onto that certainty is the moment that you will have business uncertainty, which will make business not happen.
The second aspect is, of course, the simple arranging of one's own personal affairs as an individual in our society. How do I arrange my affairs if I am ever at risk that a government will come and retroactively change the basis on which I make those arrangements of my own affairs? In the end, it goes to the position of the citizen in our state.
I would say, then, that interfering with vested rights is only justifiable in the very rarest of circumstances. I would say that must be particularly true — must it not? — when the judicial branch has confirmed those vested rights.
[Translation]
There is also an issue of simple justice. The government itself wrote this rule. It seems to me that the government should have taken into account the risk of being associated with one court rather than another. As a simple question of justice, what will Canadians say if that risk does not apply to the authorities that set the rules?
[English]
You remember that the government did respond a year and a half later to the seventh report of the Standing Committee on Public Accounts by issuing five guidelines that would govern the government's adoption of retroactive legislation. I submit to you that not a single one of those guidelines is at issue here.
One of those guidelines is that it will be all right if the amendments are corrections of ambiguous or deficient provisions. This amendment is no more a correction of an ambiguity or a deficiency than any amendment. All amendments are to correct a perceived ambiguity or deficiency. I say to you that if you let this one through there is a precedent there that is dangerous, added, of course, to the ones that Mr. Desaulniers correctly put before you.
[Translation]
In conclusion, this amendment would remove Canadians' certainty in the area of taxation. It would be a very serious development for the whole system, not only for the practice of my learned friend, but for the practice of all lawyers and the dealings of every citizen.
[English]
Some of you have wondered how to cure this. A proposal of amendment to the bill has been put to you.
[Translation]
It is true that we occasionally see some retroactivity in the taxation field. We see it with the stock market, for example. In this case, to reflect what is done with regular tax cases, it would be perfectly all right to maintain retroactivity, but only back to December 2001, when the announcement was made. That is what I would suggest.
[English]
The Chairman: I thank all of the witnesses today for their cooperation.
[Translation]
Senator Bolduc: I found the briefs of our witnesses very clear. I therefore have no particular comments to make.
I get the feeling that the kinds of measures we are talking about today are implemented to correct administrative errors by officials. This is not acceptable. If an official commits an error — and things are so complex that an official could well commit a very strategic error — then the government has to pay for it. The client should not have to bear the burden.
Senator Beaudoin: If we choose to take the legal route, we end up in court, as logic would dictate. If we take the legislative route, the same thing applies. What I find interesting in your statement is that the government's intent is nothing more than an intent until it is formulated in a statute. I do not see how one can intervene and set aside a court ruling by saying that one does not see things in the same way and set about doing something else. We have to comply with the court ruling. We have to respect the legislative and judicial processes. Both are sovereign in their own areas. If we take one path, we have to stay on it until the end. We cannot take both paths and amend the statute simply on the basis of government intent. Things have to be very clear.
If the legislation is not amended, then the court ruling must apply until such time as the legislative powers intervene clearly, in a specific field, to set aside the ruling.
Mr. Desaulniers: We have always — and I have been in the taxation field for almost 40 years — had retroactive amendments in taxation. Normally, they are retroactive to the day to the budget, but we have always assumed that the amendment would not apply to pending cases, simply because the legislative arm of the system should respect the judicial arm. This is the principle that is now being set aside.
Senator Beaudoin: If we do not do that, we mix the two.
Mr. Potter: What Mr. Desaulniers has just said is extremely important. We should not fall into the trap of granting retroactivity simply for those who have succeeded in obtaining a ruling.
Senator Beaudoin: No, we should not.
Mr. Potter: We should grant it to all those who had cases pending. Otherwise, why file cases and go before the courts? It is going before the courts that counts, not the ruling.
Senator Beaudoin: We agree on that score.
[English]
Senator Day: I want to have your proposal clear in my mind. You will recall the discussion we had with respect to three different groups: The Des Chênes School Board group, group number two, which had the "mise en cause," and the third group that did nothing. With your argument that there should not be retroactivity, are you then advocating that group number three also be entitled to reimbursement, even though they did not bring a case to court?
Mr. Potter: I am here for the Canadian Bar Association, Senator Day, so I am not here for group one, two or three. I do not intend to get into the facts of that case or who did what when because I do not know. From the perspective of the principles that I am defending, I do not think it should matter.
I am proposing that because this is in respect of tax, Parliament should allow the kind of retroactivity that normally applies in a tax matter — to go back to the announcement, which usually is a budget announcement. In this case, it happens to be a press release. Go to the press release of December 2001. Personally, I would stop there.
If it were that, as senators, you fear people coming out of the woodwork who actually had not done anything prior to December 2001, then you would be attracted to the proposed amendment by Mr. Tassé. It would be a shame to do that. You have no information before you, as far as I know, as to the danger, as to the scope of the dollars in question or as to the people coming out of the woodwork. If I were a senator, I would stick to the principle of it because it is time to return to the principles of the issue for the reasons that I stated. The principle would allow you to return in retroactivity to the time of the announcement period.
Senator Day: In respect of those comments, if we were to adopt your position on principle — that group three who made no application to the court would also be entitled to the same reimbursement and should be —
Mr. Potter: Excuse me, I have been very clear, senator.
The Chairman: One moment, senator. Mr. Potter will speak to that.
Mr. Potter: I thought I made it clear in my tailgating on Mr. Desaulniers that it is important that the people who had actually instituted something by that date should not be covered by the retroactivity.
Senator Day: Absolutely. Why should those others who did nothing, have to start a court case in order to be entitled to the same reimbursement?
Mr. Potter: Senator, if I were a senator, I would only go back to the day of the announcement, December 2001, and I would forget about whether other people would come or not.
However, it may be that you are concerned that there are many who have done nothing. In that case, you could go with the approach suggested by Mr. Tassé — and, indeed, the approach suggested by Mr. Desaulniers — that you allow an exception to the retroactivity, but not an exception that applies only to people who have judgments, whether by consent or otherwise. The exception has to be for everyone who had a proceeding of some kind files.
Mr. Desaulniers: May I add to that? The practice is such that when a retroactivity amendment is proposed, it does not apply to cases pending; and taxpayers have known that well since 1917. Thus, people know that when there is an amendment, they have to bring their case to court or it will not be covered. I guess that is the answer I guess to your question.
Senator Day: That is a good answer. Is it a basic principle that if you have a court case pending on an issue and an announcement is made, that it should not apply to that pending case?
Mr. Desaulniers: Absolutely.
Senator Mahovlich: With regard to group three, could other provinces come into play, such as Manitoba and those on the East Coast?
Mr. Potter: Senator Mahovlich, from the perspective of the Canadian Bar Association, I do not know if there are situations out there. I suppose in theory there are. However, if the retroactivity that you allow is a retroactivity that excludes people who have actually begun proceedings before December 2001, you exclude that possibility.
Senator Mahovlich: School boards are school boards and in Canada, we do things across the board. What is good for the gander is good for the goose, I always say. That is fair and I think that is what the public wants. That is common sense. It is not lawyer talking. It is just a common-sense guy.
Mr. Potter: Mr. Chair, there is a point here. Among the five criteria that the government announced in 1995 in response to the 1993 seventh report of the standing committee, et cetera, one has to do with whether people are going to get a windfall, and the other as to whether the money in question is necessary to preserve the stability of the Crown's revenue base. Looking at those two criteria, first, this money is not necessary to the Crown's revenue base. It is perhaps necessary to the saving of face of some people, but it is not necessary to the stability of the Crown's revenue base.
Will it be a windfall for certain taxpayers? I think it is relevant that we are talking about school boards. We are not talking about a windfall for each individual school board. It is not a huge amount of money and they need the money, frankly. That would lead me to my preferred solution: that your exemption should only go back to that date, period, and that is it.
Senator Comeau: I would like to ask you about a trend. Recently a bill passed through the Senate whereby we retroactively broke our word as Parliament. We said that we are now breaking a promise we made retroactively from 1917 or so, whereby we had promised Canadians that the contents of their census forms would not be divulged. Recently, we passed a bill in the Senate that breaks that promise retroactively. Is this a trend that we might be seeing from now on, that the government is not as concerned with breaking its commitments retroactively?
Mr. Potter: First, in law and in our Constitution, Parliament can do no wrong. We used to say that Parliament may do anything it wants except turn a man into a woman, and, frankly, in law, it can do even that. In fact, we are seeing some of that going on right now.
The fact is that we have always had a system of government that allows people to do quite unthinkable things, such as change things retroactively. However, we have always long understood that these retroactive changes have severe consequences — particularly on the kinds of principles of which I have spoken: respect for the law, the rule of law, the position of the citizen in the society in which he or she lives. There are very grave consequences. That means that we must have those consequences in mind in each case in which we are looking at using this unbelievable power of Parliament to change history retroactively.
It does not mean we should never do it, but it means we have to be very careful. To get to your real question, whether we are becoming a little bit too careless in doing it, I think when you hear the story that Mr. Desaulniers told you you have to conclude that the answer is yes.
Senator Comeau: When I first arrived in the Senate we had what was then called the "Pearson bill," where we wanted to remove the rights of citizens to have their day in court.
We fought tooth and nail on that one and I think we did, in fact, win. I think it was a great win for Canadians. We should not drop the constant vigilance that the Senate has had for such items as far as I can remember.
Mr. Potter: The fact that this bill is now before you indicates that you are the guardian on this point.
Senator Comeau: Exactly.
The Chairman: That is a good note on which to end, before we go back to too many precedents.
Honourable senators, representatives of the Department of Finance will be here to explain this tomorrow evening at 6:15. They will be here obviously to discuss all the other provisions — 130 of them — in this bill.
Let me thank the witnesses again and thank everyone for their forbearance. We have gone overtime. It has been very helpful.
The committee adjourned.