Newsroom – Convictions – Ontario

Judge’s verdict reasonable — Conviction did

not represent miscarriage of justice

M was the director and controlling mind of the corporate taxpayer. Both were charged with two counts of making scientific research and experimental development (‘‘SR&ED’’) claims to which they were not entitled. They were acquitted on the first count, because the trial judge found that they genuinely believed they were entitled to the first claim. However, they were convicted on the second count, because the trial judge found that when making their second claim, they deliberately filed intentionally misleading documentation, even though they had been told by Canada Revenue Agency officials the reasons why the claim was invalid, and had understood those reasons. They were also fined $250,000, i.e., approximately 77% of the SR&ED claim, which was at the low end of the sentencing range provided in the Income Tax Act. The taxpayer appealed to the Court of Queen’s Bench of Alberta.

The taxpayer’s appeal was dismissed. Neither the trial judge’s findings of fact nor his verdict were unreasonable. In addition, the taxpayer’s conviction did not represent a miscarriage of justice of the type contemplated in s. 686(1)(a)(iii) of the Criminal Code. Nor were the sentences excessive.