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The SCC’s use of webcasts will likely be met with conflicting reactions. On the one hand, the webcasts increase the court’s accessibility to the general public. This will not only encourage Canadians to take an interest in the work of the SCC, but may also provide practical insights into the optics of a Supreme Court proceeding. On the other hand, the ready availability of archived video recordings may result in less candid discussion and more cautious judgments from the court.

With the addition of the webcasts, it is possible that the SCC website will become a destination for the broader public, as well the legal community. However, if viewers expect the excitement of a Law and Order episode, they will likely be disappointed when they find the sober, logic-laden, if somewhat dry, jurisprudence of the Supreme Court. Only time will tell how the webcasts will fare, but the growing online presence of the SCC certainly indicates the court’s commitment to dynamism and transparency.

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Ten years ago, there would be no issue as to whether or not a partnership exists in this situation. Back then, it was the “carrying on of a business, not a mere agreement to carry it on” which constituted the test for a partnership. Now, however, more recent case law allows for the possibility of a “pursuit partnership” which calls for the duty of utmost good faith to arise, even when “trading” may not have yet commenced. In situations, such as the one at hand, the plaintiffs argue that the pursuit partnership was formed initially, even though the actual “acquisition partnership”, which would have likely been a limited partnership, had not yet come into existence since the parties had not agreed on the format of the ultimate transaction.

At trial, the judge found that there was no partnership in these circumstances since the men had only agreed informally to “work toward the formal arrangement”, hence there was no duties of good faith or loyalty. Nor did the judge find that a joint venture had existed. Despite this, even if there were a partnership or a joint venture in these circumstances, the judge found that when Aquilini withdrew from the relationship in March he was allowed to compete against the two other businessmen, as there had been “no maturing business opportunity” existing by the time he departed from the group. Among other reasons, the plaintiffs argued at the Court of Appeal that the trial judge misconstrued the nature of the common venture and misapprehended the evidence as to the nature of the common venture, which lead to err in law in her determination of the agreement that constituted the partnership. They also claimed that the judge erred in law regarding the essential terms of the partnership contract and in holding that even if the men were partners, Aquilini owed no fiduciary duties to the other two men following his departure from the group, as well as misconstruing and overlooking key relevant evidence.

In looking at the facts of the case, it was found that none of the three businessmen had the authority to bind the others in any transaction. All proposals would be in the form of expressions of interest and a consensus among the three men was required before any proposal could form the basis of a binding agreement. Further, the upper limit of the price each was willing to pay was not discussed, nor were the terms they were ultimately prepared to accept. Finally, the group agreed that even once the transaction was formed, each member could decide whether or not to proceed and was permitted to seek the approval of his family as to whether to go forward with the transaction or not. Any member was free to leave the group at any time.

The British Columbia Court of Appeal dismissed the plaintiffs appeal, holding that no partnership had been created. While the Court of Appeal found that the trial judge did not always clearly distinguish the concepts of a “pursuit” versus an “acquisition” partnership, the court held that according there was simply not enough evidence to establish a “pursuit partnership”. The court acknowledged that recent case law have broadened t he meaning of “carrying on business”, however, this cannot be interpreted as eliminating the basis o f a partnership, specifically the “subjective intention to carry on business in common with a view to profit”. Here, there was no intention either by written evidence or the conduct of the parties to carry on business in common with a view to profit. They had a “loose understanding” of what the others wished and did not commit to anything other than the payment of their lawyer’s fees. Further, there was no actual offer for the purchase of the Canucks, only “expressions of interest” and no promise to be held jointly liable for obligations that may arise relating to the acquisition. Further, there was no suggestion that Aquilini was bound to continue on as a member once he left the group, and each individual was able to pursue his own interest. Finally, the men were experienced businessmen who had experience with partnerships and partnership agreements, as well legal advice and there was no evidence that a fiduciary relationship was created as they had no discussed or assumed that any of them would act in each other’s best interests. As stated by the trial judge, C.A. Wedge J., “the law does not discourage the pursuit of self-interest in most commercial dealings. Whether an individual owes a duty of loyalty or good faith to another depends on the nature of the particular relationship in issue.”

While the decision came as a relief to the Aquilini family, should the case eventually be heard by the Supreme Court of Canada, it may serve as an opportunity for the court to further clarify the law surrounding partnerships and their corresponding obligations. For now, however, the law regarding partnerships stands for situations of this nature. As M.V. Newbury J.A stated for the Court of Appeal in paragraph 58:

The parties in this case were experienced businessmen who were familiar with partnerships and partnership agreements. They had legal advice at the outset of their relationship. There was no evidence that they discussed or assumed that each of them would act in the others’ best interests, nor did any confer a discretion on another to act for him, thus becoming vulnerable to that other’s discretion. None was empowered to bind the others in their negotiations. In short, the facts as found by the trial judge do not establish any of the usual hallmarks either of a partnership or of a fiduciary relationship generally.

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Writing for a unanimous court, Abella J. allowed the appeal and restored the order made by the trial judge. On the significance of the presence of professional assistance with respect to the vulnerability of one party to a separation contract, Abella J. justified the court’s finding by drawing on Miglin:

[61] [Miglin] indicates that when vulnerabilities have been compensated for by the presence of professionals, the agreement should be respected. This is an important observation. Given that vulnerabilities are almost always present in these negotiations, the parties’ genuine wish to finalize their arrangements should, absent psychological exploitation or misinformation, be respected. One way to help attenuate the possibility of such negotiating abuses is undoubtedly through professional assistance. But exploitation is not rendered anodyne merely because a spouse has access to professional advice. It is a question of fact in each case.

In the present case, Abella J. explained, the trial judge had concluded that Rick’s vulnerabilities were notcompensated for by professional assistance, because her emotional and mental condition rendered her unable to make use of it. As the trial judge’s findings of fact were fully supported by the record, the Court of Appeal should not have rejected them.

The lesson to take from this case is that the deliberate failure to make full financial disclosure when entering into a marriage or separation contract may result in a court finding that the contract is unconscionable and therefore unenforceable. (An example of a similar situation in the context of a marriage contract was seen in LeVan v. LeVan, 2008 ONCA 388, leave to appeal refused 2008 CanLII 54724).

To be sure, Abella J. did qualify her finding, noting that “[w]hether a court will, in fact, intervene will clearly depend on the circumstances of each case, including the extent of the defective disclosure and the degree to which it is found to have been deliberately generated[; i]t will also depend on the extent to which the resulting negotiated terms are at variance from the goals of the relevant legislation” (para. 49). Nevertheless, Rick makes clear that there is a duty on separating spouses to provide full and honest disclosure of all relevant financial information “to protect the integrity of the result of negotiations undertaken in these uniquely vulnerable circumstances”.

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The turmoil began back in 1990 with the Royal Commission of Inquiry into the wrongful conviction of Donald Marshall. The damning report placed blame for the wrongful conviction and 11-year incarceration of the Mi’kmaq man on the shoulders of the Attorney General and the Crown Attorney’s office. In particular, it criticized the Crown Attorney’s for becoming overly zealous and vulnerable to political interference. The Nova Scotia legislature responded by moving the Crown Attorney’s office to a new arms-length organization under less control of the Ministry. But the problems were not to end there. Instead, the new organization created internal confusion as to how the relationship with the government was to work. That compounded with complaints over low pay, burdensome case loads and a loss of public confidence meant for plummeting morale in the Crown’s office by the end of the decade.

In 1999, the Nova Scotia Crown Attorneys staged a 2-day strike over their working conditions. The action was a major success for staff lawyers the who walked away with an agreement from the provincial government that recognized the Crown Attorney’s Association as their official bargaining representative and put in place mechanisms for collective bargaining over some issues. The victory was only partial, however. The scope of what could and could not be bargained for was narrowly circumscribed to the issue of wages, and more notably the agreement did not include mechanisms for resolving grievances related to discipline and termination. Perhaps galvanized by the success of the strike, the Nova Scotia Crowns continued to press for these and additional protections that appeared to be more union-like in their character, similar to those enjoyed by other public sector workers. When the provincial government refused to budge on these issues, the Crowns in Nova Scotia filed a lawsuit in Superior Court raising section 2(d) of the Charter.

Before the case could get to get to trial, the Supreme Court released its decision in BC Health Services. Seeing the writing on the wall, the Nova Scotia government ceded to the Crowns’ demands. The result is that Crowns in Nova Scotia now have a bargaining and grievance process nearly identical to that of other unionized public sector workers. Notwithstanding the absence of a judicial ruling, the Nova Scotia Crown’s case demonstrates that lawyers are often like many other employees who find themselves in employment circumstances where collective action is desirable. And the situation is not limited to Crown Attorneys. Criminal defence lawyers in Ontario and Manitoba have staged strikes to protest inadequate legal aid tariffs, and staff lawyers working in public defender offices often attempt to bargain collectively for terms of employment. It seems likely that the government now has a constitutional duty to negotiate with some of these publicly-employed lawyers - but exactly where the lines of that duty get drawn remain to be determined.

Further, whether and to what extent the Charter might apply to private-sector lawyers raises additional questions. Most jurisdictions exclude private-sector lawyers from their labour legislation, leaving them without protections to organize and bargain - very much like agricultural workers. Granted, it is doubtful that the courts would have much sympathy for lawyers’ need for labour law protection (indeed, lawyers seem more than capable of defending their rights without the protection of the state), but the structural and legal similarities between lawyers and agricultural workers run far enough that a 2(d) claim on behalf of private-sector lawyers is not beyond imagination. The struggle for gender equity in large firms, and the perceived lack of protection for women in the profession, for example, may signal some areas where lawyers’ collective action may warrant protection. For the time being lawyers’ unions may seem far-fetched, but as the implications of the BC Health Workers decision are fleshed out, the possibility of lawyers organizing themselves collectively may seem more plausible.

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The Conviction of Donald Spindler
In 2001 Donald Spindler was convicted by a jury of second degree in the death of Irene MacDonald. The Crown’s theory is that Spindler murdered MacDonald, and disposed of her body by pouring lye over it. This is based on the testimony of two witnesses. Firstly, Spindler’s ex-wife Katherine McCoy testified at trial that Spindler had previously threatened her and claimed he could get rid of a body by pouring lye over it. The second Crown witness was William Tanton, who dated Spindler’s daughter during the 1980s. Tanton testified Spindler told him that he had choked Irene and disposed of her body around Southampton by pouring acid on it.

There are credibility issues with both of the Crown’s key witnesses. McCoy admitted to lying to the police including on sworn statements and faced obstruction of justice charges. Tanton’s criminal record includes several crimes of dishonesty and he has been described as a ‘career informant.’ Tanton stated at trial that two of his convictions would be coming off of his record.

The Ontario Court of Appeal dismissed Spindler’s appeal based on the W. (D.) Instruction and Vetrovec Warning.

The Innocence Project
Enter the Innocence Project. The Innocence Project at Osgoode Hall Law School is one of several similar programs across Canada that assist individuals who claim to have been wrongfully convicted. Law students work under the direction of faculty to seek proof for the claim of innocence. Individuals apply to the Innocence Project and their cases are initially assessed based on the following criteria:

A conviction for a serious offence
All rights of appeal have been exhausted
A claim of factual innocence is seriously advanced
Alternative resources are unavailable

Ms. Rehner is assisting with Mr. Spindler’s appeal. Innocence Project students gain high level experience by finding new evidence and developing legal arguments required to prove the innocence of individuals who feel they were wrongfully accused. Six Innocence Project students have assisted with the Spindler file since 2005.

Application for Leave to Appeal to the SCC
The central issue with the Crown’s theory of the case is its reliance on circumstantial evidence from two witnesses with questionable credibility. This issue is exacerbated by the fact there was no body or forensic evidence discovered. The Innocence Project staff are preparing a 20-page factum for submission to the SCC.

With regards to the chances of success of the leave to appeal application, Ms. Rehner says there are novel legal issues of national importance connected with this case. She understands that the SCC does not normally provide reasons when applications for leave are dismissed. As a result, denied applicants will never know the grounds on which their application was denied. This could be frustrating for applicants when there are substantive arguments combined with procedural issues and limitation periods.

The fate of Spindler’s SCC application will not be known for several months. Through her involvement with the Innocence Project, Ms. Renher has already observed the drawbacks of the narrow approach taken by law enforcement and the Crown to some murder investigations. She feels this can lead to both wrongful convictions and or unsolved cases. If all goes well for Mr. Spindler, TheCourt could be reporting on his hearing at the SCC in the near future.

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On November 23, 2005, both Teck and Lloyd’s sought declaratory orders regarding the insurers’ obligations to defend and indemnify (in the affirmative and in the negative respectively). Teck commenced their action in Washington State, whereas Lloyd’s pursued their action in British Columbia Supreme Court. Each party then took steps to obtain jurisdictional rulings.

On May 1, 2006, the U.S. District Court for the Eastern District of Washington asserted jurisdiction over the matter by denying the insurers’ applications to dismiss Teck’s claims against them. They did so on the basis of forum non conveniens.

In B.C., Teck was denied their application for stay of the proceedings against them in the B.C. Supreme court. Teck’s appeal to the BC Court of Appeal failed, and the case was further appealed to the SCC.

Analysis

S. 11 of the CJPTA states the following:

11(1) After considering the interests of the parties to a proceeding and the ends of justice, a court may decline to exercise its territorial competence in the proceeding on the ground that a court of another state is a more appropriate forum in which to hear the proceeding.

(2) A court, in deciding the question of whether it or a court outside British Columbia is the more appropriate forum in which to hear a proceeding, must consider the circumstances relevant to the proceeding, including

(a) the comparative convenience and expense for the parties to the proceeding and for their witnesses, in litigating in the court or in any alternative forum,

(b) the law to be applied to issues in the proceeding,

(c) the desirability of avoiding multiplicity of legal proceedings,

(d) the desirability of avoiding conflicting decisions in different courts,

(e) the enforcement of an eventual judgment, and

(f) the fair and efficient working of the Canadian legal system as a whole.

Teck advanced two arguments before the SCC: (1) that the multifactored test under s. 11 must give way to a ‘comity-based’ test that respects foreign courts’ decision to take jurisdiction, and (2) that even if the s.11(2) factors are to remain in contemplation, that “the assertion of jurisdiction by the foreign court is a factor of overwhelming significance in the determination of whether the local forum is appropriate (forum conveniens).” (para. 19)

The SCC rejected both arguments.

In rejecting the first argument, the court notes that not only does a comity-based test not supersede the s.11(2) factors, but also, that each of the factors must always be considered. At para. 21, the court states,

The CJPTA creates a comprehensive regime that applies to all cases where a stay of proceedings is sought on the ground that the action should be pursued in a different jurisdiction (forum non conveniens). It requires that in every case, including cases where a foreign judge has asserted jurisdiction in parallel proceedings, all the relevant factors listed in s. 11 be considered in order to determine if a stay of proceedings is warranted. (emphasis mine)

Further, the court closed the door on the introduction of any additional factors in the forum non conveniens determination. After noting that the CJPTA emanated from the Uniform Law Conference of Canada, the court states the following at para. 22:

[s]ection 11 of the CJPTA thus constitutes a complete codification of the common law test for forum non conveniens. It admits no exceptions. (emphasis mine)

In rejecting Teck’s second argument, the court advances two points. First, McLachlin C.J. notes that the legislature’s mention of the avoidance of a multiplicity of proceedings is one amongst many factors in s. 11(2). Specifically, that factor was not given any special preference by the legislature. As such, the court determines that the assertion of jurisdiction by a foreign court should not be made an overriding and determinative factor in the s. 11 analysis as Teck suggested.

Second, the court distinguishes several authorities put forward by Teck. In short, the court notes that the cited cases all took into account the several factors mentioned in s.11(2) without elevating the factor of the existence of parallel proceedings above all other factors.

After rejecting Teck’s two arguments, the court went on to further articulate policy reasons for rejecting Teck’s position. At para. 29, McLachlin C.J. writes,

To adopt this approach would be to encourage a first-to-file system, where each party would rush to commence proceedings in the jurisdiction which it thinks will be most favourable to it and try to delay the proceedings in the other jurisdiction in order to secure a prior assertion in their preferred jurisdiction. Technicalities, such as how long it takes a particular judge to assert jurisdiction, might be determinative of the outcome. In short, considerations that have little or nothing to do with where an action is most conveniently or appropriately heard, would carry the day. Such a result is undesirable and inconsistent with the language and purpose of s. 11, discussed above.

Moreover, the court comments on dangers emanating from a potential difference between different conceptions of jurisdiction:

A distinction should be made between situations that involve a uniform and shared approach to the exercise of jurisdiction (e.g. inter-provincial conflicts) and those, such as the present, that do not. In the latter, blind acceptance of a foreign court’s prior assertion of jurisdiction carries with it the risk of declining jurisdiction in favour of a jurisdiction that is not more appropriate. (emphasis mine, para. 30)

In the end, the court advocates “[a] holistic approach, in which the avoidance of a multiplicity of proceedings is one factor among others to be considered, [because it] better serves the purpose of fair resolution of the forum non conveniens issue with due comity to foreign courts.” (para. 30)

Applying this law to the facts, the court concluded that the chambers judge took into account the appropriate factors when denying Teck’s initial claim. That is, the central issues in determining whether there was insurance coverage (disclosure, risk assessment, and policy interpretation) “weighted in favor of British Columbia, and that the only coverage issues properly the substance of the U.S. Environmental Action are inconsequential.” (para. 34)

Enforceability of Potential Conflicting Judgments

While it is clear that a strict comity-based test with regards to asserting jurisdiction is rejected, comity remains a valid doctrine when enforcing judgments. A possibility emanating from this decision is that parties may have to deal with multiple conflicting judgments from different jurisdictions. While the court was aware of this consequence, it did not specify the exact response.

However, the court did supply a brief outline of potential solutions: (1) a race where the first judgment handed down prevails; (2) an absolute preference for local proceedings; or (3) a middle ground that adopts a general first-to-judgment rule but affords additional defences to enforcement that may be engaged in some circumstances. (para. 39)

Comment

In an era of ever-increasing global trade, this case makes real the possibility that international Canadian businesses could be exposed to simultaneous proceedings in both foreign and local jurisdictions for the same matter. While the court’s reasons for refusing to elevate the factor of parallel proceedings seem cogent, the prospect of multiple legal proceedings stemming from a single cause of action (the reality for Teck now) is an immensely cumbersome one.

Moreover, the uncertainty stemming from the court’s reluctance to pronounce on what happens in the face of potential conflicting judgments is problematic. Each of the proposed responses offered by the court presents problems.

If solution 1, “a race where the first judgment handed down prevails,” is adopted, it will create the possibility that after a local court has asserted jurisdiction, the case is nevertheless decided in a foreign court. Such an outcome is wasteful of judicial resources, and reduces the legitimacy of the original assertion of jurisdiction by the local court.

If solution 2, “an absolute preference for local proceedings,” is adopted, the principle of comity will be reduced to an impotent doctrine. In the SCC’s recent decision in Pro Swing Inc. v. Elta Golf Inc., 2006 SCC 52, the majority opinion spoke about the need to balance comity with the protection of the judicial system of the enforcing state (para. 27). Considering that the court ultimately held that foreign non-monetary judgments could be enforced (with certain preconditions), it seems that a strict preference for local proceedings would seem to give comity too limited a role.

Thus, the third solution, “a middle ground that adopts a general first-to-judgment rule but affords additional defences to enforcement…,” is arguably the best approach to resolving the issue of conflicting judgments. Presumably, defences that are required to preserve the legal legitimacy of any domestic decision (and the accompanying judicial system) would fall into this category. Nevertheless, questions remain about these defences would be shaped remain.

The uncertainty emanating from this decision makes it difficult for companies put in such a situation to plan. Not only are they now subject to the expenses of having to partake in multiple proceedings, they are further faced with not knowing whether the judgments that they are seeking to obtain will be enforceable. Such a situation seems to fly in the face of the principles of rule of law and predictability.

In the final analysis, given that the potential for conflicting judgments is also a factor in the determination of whether to assert jurisdiction, it seems that courts are hopeful that such a situation will not arise. If it ever does, it will be interesting to see how the difficult tension between comity and the preservation of local rulings is resolved.

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Before there was any question as to Dr. Smith’s conduct, Ms. Marquardt launched an appeal to the Ontario Court of Appeal in 1998 on three grounds. Ms. Marquadt appealed on several grounds. She alleged that the trial judge erred in failing to properly direct the jury as to the meaning of reasonable doubt. Secondly, she argued that the trial judge erred in directing the jury that they could draw an adverse inference against Ms. Marquardt’s version of a conversation with a witness because her version had not been brought to the witness in cross-examination. The Ontario Court of Appeal dispatched both arguments in one paragraph. Ms. Marquadt’s third ground of appeal was that the trial judge erred in failing to relate the evidence in support of a manslaughter verdict to the elements of that offence. Ms. Marquardt argued that this non-direction deprived her of the jury’s effective appreciation of the manslaughter alternative. Though the OCA considered this ground in more detail, the court still found that the judge’s charge on manslaughter was sufficient, and the appeal was dismissed.

Now, in light of the staggering evidence against Dr. Smith, Ms. Marquardt has the opportunity to launch her appeal on entirely new grounds. Her motion to extend the time to serve and file her application for leave to appeal from the OCA’s 1998 judgment, and to file a lengthy memorandum of argument, has been granted by the SCC. Though it is clear that the details of her appeal are still under construction, an affidavit filed with the SCC brief demonstrates that Dr. Smith’s excoriated work will certainly be questioned in this case, as it has in so many others. In the affidavit, Newfoundland’s Chief Medical Examiner dismisses Dr. Smith’s conclusion that Kenneth’s death was due to asphyxia as “wrong and inappropriate.” This view is corroborated by a Finnish pathologist, who stated that Dr. Smith’s conclusions were “illogical” and “against scientific-based reasoning.” Based on this preliminary argumentation, it is safe to say that Dr. Smith’s name will yet again be in the news once Ms. Marquardt’s case reaches the Supreme Court.

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The Court has recently acknowledged the chilling effect of libel law and its impact on “freedom of expression and debate that is said to be the ‘very life blood of our freedom and free institutions” in WIC Radio Ltd. v. Simpson, 2008 SCC 40. In WIC Radio, an incremental change was made to the defence of fair comment to accommodate the requirements of the “rough trade” of public controversy. The Court clarified and strengthened the defence of fair comment to permit robust discussion of matters of public interest. The intervenors in this case are now looking for similar accommodation in the defence of qualified privilege.

While the intervenors each have their own arguments, that differ somewhat in the details, there are two basic arguments that flow throughout the submissions.

Firstly, the intervenors argue that the traditional qualified privilege defence does not conform to current societal standards and Charter values as it restricts the ability of the media to report on matters of public interest and gives undue protection to reputation at society’s expense.

Secondly, the media intervenors argue that the Court should affirm the Ontario Court of Appeal adoption of the defence of public interest responsible journalism, as a necessary, principled and incremental development in the common law of defamation. This defence would be an added protection when the traditional defence of qualified privilege is inadequate to protect stories that are responsibly reported and of interest to the public. Some also argue that a defence of “public interest communication” should be adopted, which would not be restricted to media.

There are differences in the way in which the various media intervenors would like to see the changes made. There are those who would simply like to see the “public interest responsible journalism” (PIRJ) defence adopted, wholesale, as an additional defence, as set out in Justice Sharpe’s Court of Appeal judgment in Quan, with no alteration to the traditional defence of qualified privilege. There are others who would prefer that the defence of qualified privilege simply be expanded to include PIRJ. And, there are those who would like to see a test like that in Dagenais v. Canadian Broadcasting Corporation, [1994] 3 S.C.R. 835, applied in cases where a question of potentially erroneous defamatory fact, on matters of public interest, is expressed.

The current state of the law is outdated and unconstitutional. Most people in a democratic society such as ours receive their information from a third party, be it on the internet, through newspapers or through broadcast media. As participants in a democracy they have a right to timely information on all matters of public interest. At the same time, those who publish the information have a responsibility to ascertain, as much as possible, the truth of the facts they are imparting. A recognition, from the Court, that this new approach is necessary and desirable, would greatly reduce the chill in libel law and bring Canada into the 21st century.

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The plight of immigrants ought to be the proper focus of the constitutional challenge. A recent report indicates that recognizing polygamous marriages and repealing the criminal prohibitions against it would in fact promote the well-being of women and marginalized immigrants. The report, prepared for Status of Women Canada by several members of the Queen’s University Faculty of Law points to the harmful effects the prohibition has on immigrating practitioners of polygamy. First, polygamous families will not be permitted to immigrate to Canada as a single family unit. Should they immigrate separately, their immigration applications may be rejected on the basis that the applicant will commit criminal offences in Canada. This raises the possibility of the ‘wife left behind’ and may lead to disrupted family units and alienated spouses such as the case of Ali v. Canada, 1998 CanLII 8816 (F.C.). Secondly, and more importantly, women in polygamous marriages are denied the protections otherwise provided to women in monogamous marriages such as succession, the division of marital property, and spousal support. Excluding polygamous marriages from these protections is likely to have a disproportionate effect on women and especially women from minority cultures. Several provinces including Ontario have already amended their legislation to recognize polygamous relationships for some purposes, but the nation-wide result between federal and provincial jurisdictions is an inconsistent hodge-podge of conflicting rights and sanctions.

To the extent that polygamous relationships can and do cause harm, it seems to me, as well as the authors of the Queen’s report, that those harms can be addressed through other existing penal sanctions. Child and spousal abuse are already criminal offences, and Children’s Aid Societies are well-rehearsed in intervening in problematic household environments. It’s not clear that punishment of polygamy per se will in any way advance the interests of a democratic society aimed at promoting inclusion and equality. The harms of Bountiful aside, polygamy as it is practiced in most other situations raises a host of concerns. When Blackmore’s challenge hits the courts, those ought to be the focus of the argument, but I suspect the Crown will resist and keep the attention focused on the more media-appealing Mormon community.

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Under the proposals in the Working Paper, any transaction or series of transaction that is found to be abusive would be subject to a sanction of up to 25% of the additional tax under the GAAR reassessment. Promoters of an aggressive tax plan would also be subject to a penalty of 12.5% of the amount receivable for having sold the impugned tax plan.

The GAAR currently does not punish taxpayers or tax promoters for engaging in transactions that trigger GAAR reassessment. If a tax scheme is found to be abusive, the GAAR simply reassesses the taxpayer’s taxable income as if the scheme’s transactions did not take place. The taxpayer is therefore not in any worse a position than she would be if she had not engaged in the anti-avoidance scheme.

A financial penalty would deter tax planners from looking for loopholes and attempting abusive tax avoidance. Taxpayers who are unsure whether their tax plan is abusive may still avoid the penalty if they disclosed the scheme early to Revenu Québec. Notwithstanding disclosure, however, the penalization of GAAR threatens to turn aggressive tax avoidance into a lighter form of tax evasion.

The Working Paper’s recommendations concern only Quebec’s Taxation Act, but they may be a harbinger for developments across the country. Quebec’s Taxation Act has its own GAAR whose wording is virtually identical to that in the federal Income Tax Act. If the Working Paper’s recommendations are adopted, the other provinces and the federal government may follow suit and implement penalty schemes in their respective income tax legislation.

On another note, the Working Papers also offer some insight into how the government (in Quebec, at least) is interpreting the relationship between the GAAR and specific anti-avoidance provisions:

Where it is shown that the conditions for the application of a specific anti-avoidance rule are satisfied, the remedy it stipulates must be applied. The tax authorities cannot then invoke the GAAR to substitute a remedy they consider more suitable.

The government has evidently adopted Justice Rothstein’s opinion in Lipson that any specific anti-avoidance rule overrides the GAAR; that is, if a particular tax transaction already attracts a specific anti-avoidance rule, the GAAR does not apply. The majority in Lipson did not address this issue.

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