Canada (National Revenue) v. ConocoPhillips Canada Resources Corp
. (December 15, 2014 – 2014 FCA 297) is the latest in a recent string of decisions dealing with the ambit of possible judicial review by the Federal Court in the context of income tax assessments. The recent decision of the Federal Court of Appeal in JP Morgan seemed to virtually rule out judicial reviews of assessments:
The same could be said of Szymczyk et al. v. Canada (National Revenue) which followed shortly after JP Morgan:
In Siftco however the Federal Court of Appeal allowed a judicial review in the context of a voluntary disclosure:
The ConocoPhillips decision was based on the Minister’s refusal to consider a notice of objection filed by ConocoPhillips on June 7, 2010; that refusal was based on the Minister’s assertion that ConocoPhillips had been mailed the reassessment in question on November 7, 2008 and therefore the notice of objection was out of time. ConocoPhillips on the other hand alleged that it had first become aware of the notice of reassessment on April 14, 2010 and therefore its notice of objection was timely. The Federal Court allowed ConocoPhillips’ application for judicial review and and set aside the decision not to consider the objection.
The Federal Court of Appeal set aside that decision on the basis that the proper forum was the Tax Court of Canada:
 In the present case, ConocoPhillips’ proper recourse was to commence an appeal to the Tax Court under paragraph 169(1)(b) of the Act and to demonstrate in that appeal that its notice of objection was filed on a timely basis. It is within the jurisdiction of the Tax Court to determine whether the notice of reassessment was in fact mailed as the Minister alleges. This it will do on a full evidentiary record with regard to the statutory presumption found in subsection 244(14) of the Act (which presumes a notice of reassessment to have been mailed on its date). See: Walker v. Canada, 2005 FCA 393, 344 N.R. 169, at paragraphs 11 to 13. It is open to ConocoPhillips to request that the question of the timeliness of its notice of objection be determined before the trial pursuant to Rule 58(1) of the Tax Court of Canada Rules (General Procedure)
 At paragraph 8 of his reasons, the Federal Court Judge expressed the view that paragraph 169(1)(b) of the Act did not apply because “the conditions precedents [sic] do not exist”. To similar effect, in this Court ConocoPhillips argues that it is entitled to have the Minister reconsider the notice of reassessment on the ground that subsection 165(3) obliges the Minister to reconsider an assessment “with all due dispatch” when served with a notice of objection. ConocoPhillips argues that the only way that it can have its right to reconsideration respected is by having the Federal Court resolve the timeliness issue and, if resolved in ConocoPhillips’ favour, ordering the Minister to reconsider under subsection 165(3) of the Act.
 It is uncontroversial that subsection 165(3) obliges the Minister to reconsider an assessment when served with a notice of objection. The flaw in ConocoPhillips’ position is that the ministerial obligation is triggered only when a notice of objection is served within the time frame mandated by the Act. ConocoPhillips cannot argue that the Minister’s failure to consider a notice of objection that may or may not have been filed on a timely basis takes ConocoPhillips out of the statutory scheme contained in the Act and out of the specialized expertise of the Tax Court. This argument begs the question as to the proper forum to determine if, or when, the notice of reassessment was mailed, and when the time for filing a notice of objection expired.
In a somewhat unexpected twist however the Federal Court of Appeal seems to have suggested that the Tax Court has the inherent (or implicit) jurisdiction to direct the Minister to consider the notice of objection if it finds that it was filed in a timely manner:
 Without expressing any opinion on the timeliness issue, should the Tax Court find the notice of objection was in fact filed on a timely basis the Minister will be under a legally enforceable duty to reconsider the notice of reassessment. The Tax Court may facilitate this by adjourning or staying the appeal. [Emphasis added]
As a result the appeal was allowed and the application for judicial review dismissed with costs both in the Federal Court of Appeal and the Federal Court.
Comment: This is an interesting case. While it is perhaps too early to assess the ambit of the decision, it is at least arguable that this may be the harbinger of a somewhat enhanced jurisdiction for the Tax Court over administrative or quasi-administrative law issues. The alternative argument would be that the taxpayer, having a ruling by the Tax Court that the notice of objection was timely, would then have to apply to another court (presumably the Federal Court) to direct the Minister to consider the notice of objection. If that were the case it would seem a very convoluted result.