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One Response to Revisi ting Regulatory Negligence: The

Ernst Fracking Lit igation

Martin Olszynskisays:

October 21, 2014 at 7:26 am

The British Columbia Supreme Court recently released a decision that further

supports the argument that Chief Justice Wittmann and the ABCA erred in

striking the claim against the ERCB. In Leroux v. Canada Revenue Agency,

2014 BCSC 720 (CanLII), CRA auditors were found to owe a duty of care; see

http://canlii.ca/t/g6px8.

The courts duty of care analysis starts at paragraph 271. Paragraph 306 is

interesting with respect to the second stage of the Anns/Cooper test, and is

arguably more consistent with the Supreme Courts approach in Hill than the

ABCAs approach in Ernst:

[306] The next consideration is whether policy considerations should prevent

a duty of care from being imposed. While there is a duty to the public and to

the Minister of National Revenue to collect taxes that are properly payable, as

recognized in the cases above, I am unable to see that this duty conflicts with a

duty to take reasonable care in assessing taxes, auditing taxpayers, and

particularly in imposing penalties. It is true, as CRA contends, that the

Canadian tax system depends on self-assessment, and therefore the honestyand full disclosure of taxpayer is crucial. However, within that scheme, CRA is

given almost unchecked powers. CRA officials are not accountable to any

independent body for their actions, except through an appeal to the Tax Court

of Canada. As the Supreme Court of Canada observed at para. 56 of Hill,

holding police officers to a standard of care that might make them more

careful is not necessarily a bad thing. The same reasoning applies in this case.

http://ablawg.ca/2014/10/15/revisiting-regulatory-negligence-the-ernst-fracking-

litigation/

http://ablawg.ca/2014/10/15/revisiting-regulatory-negligence-the-ernst-fracking-litigation/comment-page-1/#comment-946251http://ablawg.ca/2014/10/15/revisiting-regulatory-negligence-the-ernst-fracking-litigation/comment-page-1/#comment-946251http://canlii.ca/t/g6px8http://canlii.ca/t/g6px8http://ablawg.ca/2014/10/15/revisiting-regulatory-negligence-the-ernst-fracking-litigation/comment-page-1/#comment-946251