SR&ED in the News SR&ED Updates and Changes

Updates from the Tax Court of Canada (TCC): The Current Plan to Resume Operations

July 28, 2020 Danielle Cooper

Government operations are starting to slowly reopen and resume functioning amid Covid-19, including the Tax Court of Canada (TCC). With the help of the official TCC notices and Practice Directions, we have put together the current summary of the TCC’s current plan to resume operations.

COVID-19 Impacts

Due to the pandemic, the TCC was unable to hold approximately 1,000 plus hearings due to their closure. ¹ The TCC was unable to hold e-Trials and could not address the cases or appeals during the shutdown. Due to the lost days, adjustments to timetables can be made and are explained in further detail below.

Reduced Locations

According to “Notice to the Public and the Profession, July 8, 2020”, the TCC announced:

the Court will hold only hearings in the following locations for the remainder
of 2020:
· Vancouver
· Calgary
· Edmonton
· Hamilton
· Toronto
· Ottawa

· Montréal
· Québec
· Halifax²

Reopening and Rescheduling

On July 3, 2020, it was announced by the TCC that they would be reopening for the transaction of business beginning on July 6, 2020. This Notice to the Public and Profession states, “The Court’s Registry offices across the country will be open, with the exception of the Hamilton office.” The court resumed sitting on July 20, 2020, and conference calls resumed earlier according to the July 8, 2020, Notice to the Public and the Profession.

The TCC states:

Unless parties are specifically advised otherwise, all hearings scheduled up to December 31, 2020 in locations not on the above list will be adjourned and rescheduled to dates beyond 2020. Registry staff will contact parties affected by these postponements to confirm the cancellation of the 2020 dates and reschedule the hearings.²

Bennett Jones LLP provided a summary of a May 14 and May 15, 2020 update provided by Chief Justice Rossiter and Associate Chief Justice Lamarre of the Tax Court of Canada:

Tax Court sittings will be scheduled for throughout the summer of 2020 and the Tax Court will not take its customary break from mid-July to mid-August.

Tax Court sittings will take priority over holidays booked by litigants, counsel and judges.

Priority for scheduling of hearings will be given to the following:

General Procedure appeals commenced and disrupted by the shutdown;

General Procedure appeals adjourned as a result of the shutdown;

General Procedure cases over Informal Procedure cases; and

Informal Procedure cases involving employment/contractor matters or tax benefits, such as disability tax credits.¹

Reserved judgments will be published on a first-in-first-out basis as the TCC reopens. Judgements can be located on the Tax Court of Canada’s website.

Adjustment of Dates

The TCC is considering the time between March 16, 2020, and September 4, 2020, excluded time under the Tax Court of Canada Rules (General Procedure). The total time is 173 days. This means that parties may adjust their timetables by adding 173 days.²

In the “July 8, 2020 Notice to the Public and the Profession” it is explained:

The Court will not be issuing Orders for new timetables with adjusted dates. Parties are asked to adjust the timetable issued by the Court before March 16, 2020 in their proceedings by adding 173 days to all dates scheduled in the timetable.²

Those who missed an appeal deadline due to the COVID-19 pandemic and subsequent TCC closure will be granted an extension. The “July 8, 2020 Notice to the Public and the Profession” states:

Applications for Extensions of Time to File Notices of Appeal
In order to avoid numerous unnecessary Applications for Extension of Time to File Notices of Appeal, the Court will treat all Notices of Appeal filed after the statutory deadline during the period beginning on March 16, 2020 and ending on September 4, 2020, inclusively, as including an Application for an extension of time to appeal brought on the exceptional grounds that the Applicant was prevented by the COVID-19 pandemic and the Court closure from filing within the normal statutory deadlines.².

Fast-Track Settlement Protocol

In order to alleviate the backlog of cases, the TCC will be offering a fast-track settlement protocol. On July 21, 2020, the TCC released Practice Note 24 – Fast-track Settlement Conferences which will allow parties another option to fast-track their settlements to temporarily help alleviate the backlog caused by the TCC’s closure. Practice Note 24 states:

How will parties apply?

The parties must file a joint written request with the Court to the attention of the Chief Justice or Associate Chief Justice, applying for the fast-track settlement conference

The request must be no longer than 12 pages

The request must outline:

The amount in issue;

The material facts in dispute;

The key issues to be discussed at the settlement conference;

Each party’s position on the issues to be discussed;

Why the parties believe their appeal is suitable for a settlement conference;

Any settlement offers that have been made to date;

The appeal’s current stage of discovery; and

The parties’ preferred venue for a settlement conference, being one of Vancouver, Toronto or Montreal.

The request must be written in the official language in which the parties wish the settlement conference to be conducted.⁸

Safety Precautions

All courtrooms will be reconfigured to ensure the health and safety of all, including the use of plexiglass screens, social distancing measures, and masks will be required.⁹

Additionally, the Tax Court of Canada Guidance for attending in‐person hearings explains further precautions:

If you are experiencing any symptoms of COVID‐19, or have been advised by public health officials or your doctor to self‐isolate, do not present yourself to the Court’s facilities. If you are unable to attend your hearing for this reason, please contact the opposing party(ies) and the Court’s Registry as soon as possible.

You will be asked to answer questions about your health and recent travel at a screening site before entering the court facilities. You may be denied entry based on health and security considerations.

You must wear the appropriate PPE (mask and/or gloves) inside the court facilities where two‐metre physical distancing is not possible. This includes courtrooms and indoor common areas.

Masks and gloves will be available.

You cannot bring any bags into the courtroom except briefcases and documents required for your hearing. You may also bring your valuables into the courtroom.

Disposable water bottles will be provided when possible.¹⁰

On July 17, 2020, the TCC released “COVID-19: Recommended Preventive Measures RESUMING IN-PERSON COURT OPERATIONS”, which explains in detail precautions being taken. There will be signage to direct the flow of traffic within the facilities, maximum capacity will be displayed in every room, and courtrooms will be disinfected after each hearing to list a small portion of additional precautions being implemented.¹¹

The filing of documents has been adjusted as well. According to the Tax Court of Canada Guidance for attending in‐person hearings:

General Procedure hearings:
Four (4) bound and paginated copies of your book(s) of documents shall be filed at least seven (7) days before the hearing with the local Registry office where the hearing will take place. Copies may be filed in person or by mail at the address of the hearing location in the attached Order.
Informal Procedure hearings:
If your hearing is scheduled to be heard in the morning, you must file one (1) copy of your
documents to the Registry counter at 8:30 a.m.
If your hearing is scheduled to be heard in the afternoon, you must file one (1) copy of your documents to the Registry counter at 12:30 p.m.¹⁰

Conclusion

The TCC plan to resume operations has come out over a few days, they are still releasing information as they are able. If you are approaching your new hearing date or awaiting the scheduling of your hearing please refer to the official “TCC notice for guidance on in-person hearing regulations” and the “COVID-19: Recommended Preventive Measures RESUMING IN-PERSON COURT Operations” which offer instructions on safety protocols for these hearing as well as instruction on exhibit filing protocols. Please visit the TCC’s website for the most up to date information on the TCC plan to resume operations and any changes which may arise. For additional information on SR&ED related openings please see our post Breaking News: CRA Processing SR&ED Claims. It is wonderful to have things up and moving once again, but please stay safe and healthy.