Thursday, May 18, 2006

British Columbia Court of Appeal Varies Partial Stay in Christie

The British Columbia Court of Appeal has varied the partial stay of the Court of Appeals decision in Christie v. British Columbia, 2005 BCCA 631,finding that the Social Services Sales Tax is unconstitutional "to the extent that the Act purports to tax legal services related to the determination of rights and obligations by courts of law or independent administrative tribunals...." The stay basically required lawyers to continue to collect the sales tax, but permitted them to hold the funds in trust until the Supreme Court of Canada heard the Provincial Government's application for leave to appeal(See my March 11 post on the stay here, and my December 20, 2005 post on the Court of Appeal's reasons for judgment here.)

In varying the stay, Chief Justice Finch wrote for the court:

[17] In my respectful view, the partial stay is unnecessarily broad and unfair, not only to the petitioner and his clients, but to all low income litigants. On a reading of the chamber judge’s reasons, it does not appear to me that he considered the effect the partial stay would have on low income litigants. It requires them to pay a tax declared by both courts to be unconstitutional in respect of them. It puts them in a worse position, after the petitioner’s success on appeal, than they were in after a successful result in the Supreme Court. There is no balance in the order from their point of view. The evidence, accepted by the Supreme Court judge, was that requiring low income litigants to pay tax denied them access to justice. The partial stay has the same effect.

[18] I am satisfied that the partial stay does not strike a proper balance between government on the one hand, and those who, because of their means, are denied access by requiring them to pay the tax. In my view, there is a compelling public interest in varying the partial stay to the extent that it applies to low income persons.

[19] I would vary the partial stay and grant an exemption from its effect to the petitioner, and his clients, as well as other low income persons, and lawyers who act on their behalf. The petitioner should have the costs of this application.

You can read the Chief Justice's reasons here.

[Since I wrote this post, the Supreme Court of Canada has released its decision holding that the sales tax on legal fees is constitutional. You can read about it here.]

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