Bay Street lawyer accuses counsel of fraud in tax appeal

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A Bay Street lawyer who accused government lawyers of defrauding the court has failed in a bid to get his tax appeal reopened. Michael Davies, a partner in the banking and finance practice group at Dentons Canada LLP, was one of around 25 to 30 taxpayers who appealed the Canada Revenue Agency’s decision to disallow capital cost allowance claims for software licences in the tax years between 2005 and 2007. Davies claimed allowances totalling just under $1 million over the three years.

However, when the group’s law firm, Osler Hoskin and Harcourt LLP, settled the case for less than he had agreed to, Davies claimed the agreement had been made without his authority and was invalid, according to Tax Court Justice Randall Bocock’s April 27 decision. Since justice department lawyers knew of his objections, Davies’ new counsel argued they should never have filed a notice of discontinuance in his appeal without judicial direction, and that doing so constituted a fraud on the court.

By: Michael McKiernan
Read the full article at Law Times.