Cardel sues CRA for $32M

[Calgary14]

http://www.bnn.ca/News/2015/2/3/Excl...imidation.aspx

They are suing CRA over 'threats and intimidation' related to a $219M tax bill

[Dan02]

Can we make this one a class action?

[Locke]

You know, I get it. If CRA get it wrong they never want to admit it and their initial tactic is to become more aggressive rather than to fix it.

But I also hate when people start suing the Government for 'pain and suffering, mental anguish and cruel and unusual punishment.'

Settle down princess, you werent thrown into a rat-infested hole for a year or anything.

[darklord700]

Don't know how big Cardel is but to owe this kind of taxes is odd for a home builder.

Also, generally you appeal the assessement at the tax court and court of appeal which doesn't look like is what Cardel is doing now. They went straight to suing CRA which is just odd.

[GGG]

30 of the 32 million from the article is for lost ability to invest as they have a tax liability on their company. This lawsuit at least seems reasonable if their is no basis for the tax reassessment.

Only 2 million is for the garbage charter violation and pain and suffering.

[Resolute 14]

Originally Posted by Locke

But I also hate when people start suing the Government for 'pain and suffering, mental anguish and cruel and unusual punishment.'

A lawblogger I follow likes to define this as "butthurt in the first degree".

[Locke]

Originally Posted by Resolute 14

A lawblogger I follow likes to define this as "butthurt in the first degree".

That and anger. My half-assed assessment based on what I can tell is that Cardel are likely right in this case but they want to 'teach someone a lesson' so they throw that crap in.

Its not like CRA is a dude who has wronged you, its a faceless Government organization that isnt likely to learn any lessons and it would likely have been beneficial to everyone to have calmed down before ordering your lawyers to sue them for that kind of nonsense.

[Bill Bumface]

Originally Posted by Resolute 14

A lawblogger I follow

[kirant]

I can't be the only one who misread that as "Cartel".

[Temporary_User]

Originally Posted by kirant

I can't be the only one who misread that as "Cartel".

Probably not, but it very clearly says Cardel so I'm not sure why you would feel the need to come in and tell everyone that you have trouble reading and contribute nothing to the discussion.

If Cardel is right they really may have a case. I'm sure they have had to spent a lot of extra hours and perhaps hire on more accountants to try and fix this before. Also as they said, they couldn't take that money they thought was theirs and invest it.
This is a case of two goliaths going against each other, but Cardel is sort of the David in this case. A smaller company probably wouldn't have the resources to fight back at all.

[robaur]

Good luck to Cardel or anyone suing the CRA. Funniest thing I read today. Let me know when it works out.

[fredr123]

http://blog.bennettjones.com/2014/07...are-taxpayers/

It's rare but people have won before.

[darklord700]

I wonder how large the Ockley's RRSP accounts are that could potentially result in tax penalty of this magnitude.

-------------------------

“In the proposed reassessments, CRA was effectively objecting to the private mutual fund trust structure that saw monies paid into Ryan and Damon Ockley’s RRSPs,” the statement of claim says, “the overall effect… would be to impose tax amounting to over 150% of the actual income earned.”

[kirant]

Originally Posted by Temporary_User

Probably not, but it very clearly says Cardel so I'm not sure why you would feel the need to come in and tell everyone that you have trouble reading and contribute nothing to the discussion.

It was a poor attempt at a joke like the post above it (which is also a joke). Not sure if you're one of those types who don't want any joke posts on forums but that's the reasoning behind it.

If you're looking for something serious though, I'd be curious as to what percentage of cases against revenue agencies actually end up with the plaintiff coming out successful. It's a stat I've never heard nor do I think I know the right combination of search terms to come out with a good result. I'd imagine the agency could go into a war of financial attrition and keep appealing if they are found guilty and force those without resources into out of court settlements.

[CaptainYooh]

This looks like a very complicated case/dispute. A few years ago, Canadian Government introduced new rules allowing companies to roll their corporately-sponsored RRSP holdings into financial investment vehicles called mutual fund trusts (MFT) avoiding tax payable consequences of selling and redeeming securities held in RRSP accounts. The ruling was especially beneficial to diversified family-owned corporations that had held profits in those RRSP accounts for various family members in various affiliated companies (or limited partnerships). In March 2011, the Government abruptly changed the rules citing some unintended loopholes of MFT rollovers created as a result of the original legislation. In other words, the tax savings realized by companies converting RRSP accounts into MFTs were much higher than originally anticipated.

From what scant information available in the article, it appears that Cardel got caught in between the initial and changed rules and, as a result, got assessed huge penalties that are, in some cases, way above the 100% of the tax payable. The aggravation and stress caused on the company by the $220M assessment is understandable. They are a big company, of course, but not even remotely THAT big.

[Wormius]

Originally Posted by kirant

If you're looking for something serious though, I'd be curious as to what percentage of cases against revenue agencies actually end up with the plaintiff coming out successful. It's a stat I've never heard nor do I think I know the right combination of search terms to come out with a good result. I'd imagine the agency could go into a war of financial attrition and keep appealing if they are found guilty and force those without resources into out of court settlements.

I think there was a Marketplace or Fifth Estate segment about regular citizens trying to go up against the CRA because of some heavy-handedness on the CRAs part. I believe the citizens were pretty much SOL.

[darklord700]

Originally Posted by kirant

If you're looking for something serious though, I'd be curious as to what percentage of cases against revenue agencies actually end up with the plaintiff coming out successful.

Going up again CRA assessment, I heard it's about 50% rate of success. Not sure about suing CRA for negligence but I suspect the success rate is pretty low.