Adler v. The Queen

Adler v. The Queen
Court (s) Database
Tax Court of Canada Judgments
Date
2007-01-12
Neutral citation
2007 TCC 272
File numbers
2003-1188(IT)G
Judges and Taxing Officers
Dwayne W. Rowe
Subjects
Income Tax Act
Decision Content
Docket: 2003-1188(IT)G
BETWEEN:
DESMOND A. ADLER,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
_______________________________________________________________
Appeal heard during the course of 5 days between January 8 and January 12, 2007 at Edmonton, Alberta
Before: The Honourable D.W. Rowe, Deputy Judge
Appearances:
Counsel for the Appellant:
Curtis R. Stewart
Jasmine Sidhu and
Michael J. Gemmiti
Counsel for the Respondent:
Rhonda L. Nahorniak
Kerry E.S. Boyd
_______________________________________________________________
JUDGMENT
The appeal from the assessment made under the Income Tax Act for the 1998 taxation year is dismissed and the Respondent is entitled to costs in accordance with the terms of the attached Reasons for Judgment.
Signed at Sidney, British Columbia, this 17th day of May 2007.
"D.W. Rowe"
Rowe, D.J.
Docket: 2003-1231(IT)G
BETWEEN:
DOUGLAS ALLOWAY,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
_______________________________________________________________
Appeal heard during the course of 5 days between January 8 and January 12, 2007 at Edmonton, Alberta
Before: The Honourable D.W. Rowe, Deputy Judge
Appearances:
Counsel for the Appellant:
Curtis R. Stewart
Jasmine Sidhu and
Michael J. Gemmiti
Counsel for the Respondent:
Rhonda L. Nahorniak
Kerry E.S. Boyd
_______________________________________________________________
JUDGMENT
The appeal from the assessment made under the Income Tax Act for the 1998 taxation year is dismissed and the Respondent is entitled to costs in accordance with the terms of the attached Reasons for Judgment.
Signed at Sidney, British Columbia, this 17th day of May 2007.
"D.W. Rowe"
Rowe, D.J.
Docket: 2003-1232(IT)G
BETWEEN:
CAROL AMELIO,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
_______________________________________________________________
Appeal heard during the course of 5 days between January 8 and January 12, 2007 at Edmonton, Alberta
Before: The Honourable D.W. Rowe, Deputy Judge
Appearances:
Counsel for the Appellant:
Curtis R. Stewart
Jasmine Sidhu and
Michael J. Gemmiti
Counsel for the Respondent:
Rhonda L. Nahorniak
Kerry E.S. Boyd
_______________________________________________________________
JUDGMENT
The appeal from the assessment made under the Income Tax Act for the 1998 taxation year is dismissed and the Respondent is entitled to costs in accordance with the terms of the attached Reasons for Judgment.
Signed at Sidney, British Columbia, this 17th day of May 2007.
"D.W. Rowe"
Rowe, D.J.
Docket: 2002-4231(IT)G
BETWEEN:
DONALD BARNES,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
_______________________________________________________________
Appeal heard during the course of 5 days between January 8 and January 12, 2007 at Edmonton, Alberta
Before: The Honourable D.W. Rowe, Deputy Judge
Appearances:
Counsel for the Appellant:
Curtis R. Stewart
Jasmine Sidhu and
Michael J. Gemmiti
Counsel for the Respondent:
Rhonda L. Nahorniak
Kerry E.S. Boyd
_______________________________________________________________
JUDGMENT
The appeal from the assessment made under the Income Tax Act for the 1998 taxation year is dismissed and the Respondent is entitled to costs in accordance with the terms of the attached Reasons for Judgment.
Signed at Sidney, British Columbia, this 17th day of May 2007.
"D.W. Rowe"
Rowe, D.J.
Docket: 2003-1239(IT)G
BETWEEN:
MARY-PATRICIA BARRY,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
_______________________________________________________________
Appeal heard during the course of 5 days between January 8 and January 12, 2007 at Edmonton, Alberta
Before: The Honourable D.W. Rowe, Deputy Judge
Appearances:
Counsel for the Appellant:
Curtis R. Stewart
Jasmine Sidhu and
Michael J. Gemmiti
Counsel for the Respondent:
Rhonda L. Nahorniak
Kerry E.S. Boyd
_______________________________________________________________
JUDGMENT
The appeal from the assessment made under the Income Tax Act for the 1998 taxation year is dismissed and the Respondent is entitled to costs in accordance with the terms of the attached Reasons for Judgment.
Signed at Sidney, British Columbia, this 17th day of May 2007.
"D.W. Rowe"
Rowe, D.J.
Docket: 2003-1240(IT)G
BETWEEN:
RANDY BAYRACK,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
_______________________________________________________________
Appeal heard during the course of 5 days between January 8 and January 12, 2007 at Edmonton, Alberta
Before: The Honourable D.W. Rowe, Deputy Judge
Appearances:
Counsel for the Appellant:
Curtis R. Stewart
Jasmine Sidhu and
Michael J. Gemmiti
Counsel for the Respondent:
Rhonda L. Nahorniak
Kerry E.S. Boyd
_______________________________________________________________
JUDGMENT
The appeal from the assessment made under the Income Tax Act for the 1998 taxation year is dismissed and the Respondent is entitled to costs in accordance with the terms of the attached Reasons for Judgment.
Signed at Sidney, British Columbia, this 17th day of May 2007.
"D.W. Rowe"
Rowe, D.J.
Docket: 2003-1187(IT)G
BETWEEN:
JOANNE BEATON,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
_______________________________________________________________
Appeal heard during the course of 5 days between January 8 and January 12, 2007 at Edmonton, Alberta
Before: The Honourable D.W. Rowe, Deputy Judge
Appearances:
Counsel for the Appellant:
Curtis R. Stewart
Jasmine Sidhu and
Michael J. Gemmiti
Counsel for the Respondent:
Rhonda L. Nahorniak
Kerry E.S. Boyd
_______________________________________________________________
JUDGMENT
The appeal from the assessment made under the Income Tax Act for the 1998 taxation year is dismissed and the Respondent is entitled to costs in accordance with the terms of the attached Reasons for Judgment.
Signed at Sidney, British Columbia, this 17th day of May 2007.
"D.W. Rowe"
Rowe, D.J.
Docket: 2003-1242(IT)G
BETWEEN:
MYRON S. BORYS,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
_______________________________________________________________
Appeal heard during the course of 5 days between January 8 and January 12, 2007 at Edmonton, Alberta
Before: The Honourable D.W. Rowe, Deputy Judge
Appearances:
Counsel for the Appellant:
Curtis R. Stewart
Jasmine Sidhu and
Michael J. Gemmiti
Counsel for the Respondent:
Rhonda L. Nahorniak
Kerry E.S. Boyd
_______________________________________________________________
JUDGMENT
The appeal from the assessment made under the Income Tax Act for the 1998 taxation year is dismissed and the Respondent is entitled to costs in accordance with the terms of the attached Reasons for Judgment.
Signed at Sidney, British Columbia, this 17th day of May 2007.
"D.W. Rowe"
Rowe, D.J.
Docket: 2003-1230(IT)G
BETWEEN:
BRUCE R. BRANDELL,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
_______________________________________________________________
Appeal heard during the course of 5 days between January 8 and January 12, 2007 at Edmonton, Alberta
Before: The Honourable D.W. Rowe, Deputy Judge
Appearances:
Counsel for the Appellant:
Curtis R. Stewart
Jasmine Sidhu and
Michael J. Gemmiti
Counsel for the Respondent:
Rhonda L. Nahorniak
Kerry E.S. Boyd
_______________________________________________________________
JUDGMENT
The appeal from the assessment made under the Income Tax Act for the 1998 taxation year is allowed and the assessment is referred back to the Minister for reconsideration and reassessment on the basis that:
1. The sum of $1,926.00 included in income be deleted;
2. The Appellant is entitled to costs in accordance with the terms of the attached Reasons for Judgment.
Signed at Sidney, British Columbia, this 17th day of May 2007.
"D.W. Rowe"
Rowe, D.J.
Docket: 2003-1197(IT)G
BETWEEN:
HENRY C. BRUNS,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
_______________________________________________________________
Appeal heard during the course of 5 days between January 8 and January 12, 2007 at Edmonton, Alberta
Before: The Honourable D.W. Rowe, Deputy Judge
Appearances:
Counsel for the Appellant:
Curtis R. Stewart
Jasmine Sidhu and
Michael J. Gemmiti
Counsel for the Respondent:
Rhonda L. Nahorniak
Kerry E.S. Boyd
_______________________________________________________________
JUDGMENT
The appeal from the assessment made under the Income Tax Act for the 1998 taxation year is dismissed and the Respondent is entitled to costs in accordance with the terms of the attached Reasons for Judgment.
Signed at Sidney, British Columbia, this 17th day of May 2007.
"D.W. Rowe"
Rowe, D.J.
Docket: 2003-1198(IT)G
BETWEEN:
GARY CERANTOLA,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
_______________________________________________________________
Appeal heard during the course of 5 days between January 8 and January 12, 2007 at Edmonton, Alberta
Before: The Honourable D.W. Rowe, Deputy Judge
Appearances:
Counsel for the Appellant:
Curtis R. Stewart
Jasmine Sidhu and
Michael J. Gemmiti
Counsel for the Respondent:
Rhonda L. Nahorniak
Kerry E.S. Boyd
_______________________________________________________________
JUDGMENT
The appeal from the assessment made under the Income Tax Act for the 1998 taxation year is dismissed and the Respondent is entitled to costs in accordance with the terms of the attached Reasons for Judgment.
Signed at Sidney, British Columbia, this 17th day of May 2007.
"D.W. Rowe"
Rowe, D.J.
Docket: 2002-4221(IT)G
BETWEEN:
DAN DELALOYE,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
_______________________________________________________________
Appeal heard during the course of 5 days between January 8 and January 12, 2007 at Edmonton, Alberta
Before: The Honourable D.W. Rowe, Deputy Judge
Appearances:
Counsel for the Appellant:
Curtis R. Stewart
Jasmine Sidhu and
Michael J. Gemmiti
Counsel for the Respondent:
Rhonda L. Nahorniak
Kerry E.S. Boyd
_______________________________________________________________
JUDGMENT
The appeal from the assessment made under the Income Tax Act for the 1998 taxation year is allowed and the assessment is referred back to the Minister for reconsideration and reassessment on the basis that:
1. The sum of $1,926.00 included in income be deleted;
2. The Appellant is entitled to costs in accordance with the terms of the attached Reasons for Judgment.
Signed at Sidney, British Columbia, this 17th day of May 2007.
"D.W. Rowe"
Rowe, D.J.
Docket: 2002-4220(IT)G
BETWEEN:
RANDALL L. EDGAR,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
_______________________________________________________________
Appeal heard during the course of 5 days between January 8 and January 12, 2007 at Edmonton, Alberta
Before: The Honourable D.W. Rowe, Deputy Judge
Appearances:
Counsel for the Appellant:
Curtis R. Stewart
Jasmine Sidhu and
Michael J. Gemmiti
Counsel for the Respondent:
Rhonda L. Nahorniak
Kerry E.S. Boyd
_______________________________________________________________
JUDGMENT
The appeal from the assessment made under the Income Tax Act for the 1998 taxation year is dismissed and the Respondent is entitled to costs in accordance with the terms of the attached Reasons for Judgment.
Signed at Sidney, British Columbia, this 17th day of May 2007.
"D.W. Rowe"
Rowe, D.J.
Docket: 2003-1196(IT)G
BETWEEN:
JOHN R. HARRINGTON,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
_______________________________________________________________
Appeal heard during the course of 5 days between January 8 and January 12, 2007 at Edmonton, Alberta
Before: The Honourable D.W. Rowe, Deputy Judge
Appearances:
Counsel for the Appellant:
Curtis R. Stewart
Jasmine Sidhu and
Michael J. Gemmiti
Counsel for the Respondent:
Rhonda L. Nahorniak
Kerry E.S. Boyd
_______________________________________________________________
JUDGMENT
The appeal from the assessment made under the Income Tax Act for the 1998 taxation year is dismissed and the Respondent is entitled to costs in accordance with the terms of the attached Reasons for Judgment.
Signed at Sidney, British Columbia, this 17th day of May 2007.
"D.W. Rowe"
Rowe, D.J.
Docket: 2003-1195(IT)G
BETWEEN:
HENRY P. LAZARENKO,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
_______________________________________________________________
Appeal heard during the course of 5 days between January 8 and January 12, 2007 at Edmonton, Alberta
Before: The Honourable D.W. Rowe, Deputy Judge
Appearances:
Counsel for the Appellant:
Curtis R. Stewart
Jasmine Sidhu and
Michael J. Gemmiti
Counsel for the Respondent:
Rhonda L. Nahorniak
Kerry E.S. Boyd
_______________________________________________________________
JUDGMENT
The appeal from the assessment made under the Income Tax Act for the 1998 taxation year is dismissed and the Respondent is entitled to costs in accordance with the terms of the attached Reasons for Judgment.
Signed at Sidney, British Columbia, this 17th day of May 2007.
"D.W. Rowe"
Rowe, D.J.
Docket: 2003-1191(IT)G
BETWEEN:
ROY A. VITEYCHUK,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
_______________________________________________________________
Appeal heard during the course of 5 days between January 8 and January 12, 2007 at Edmonton, Alberta
Before: The Honourable D.W. Rowe, Deputy Judge
Appearances:
Counsel for the Appellant:
Curtis R. Stewart
Jasmine Sidhu and
Michael J. Gemmiti
Counsel for the Respondent:
Rhonda L. Nahorniak
Kerry E.S. Boyd
_______________________________________________________________
JUDGMENT
The appeal from the assessment made under the Income Tax Act for the 1998 taxation year is dismissed and the Respondent is entitled to costs in accordance with the terms of the attached Reasons for Judgment.
Signed at Sidney, British Columbia, this 17th day of May 2007.
"D.W. Rowe"
Rowe, D.J.
Citation: 2007TCC272
Date: 20070517
Dockets: 2003-1188(IT)G, 2003-1231(IT)G,
2003-1232(IT)G, 2002-4231(IT)G, 2003-1239(IT)G,
2003-1240(IT)G, 2003-1187(IT)G, 2003-1242(IT)G,
2003-1230(IT)G, 2003-1197(IT)G,
2003-1198(IT)G, 2002-4221(IT)G, 2002-4220(IT)G,
2003-1196(IT)G, 2003-1195(IT)G,
2003-1191(IT)G,
BETWEEN:
DESMOND A. ADLER, DOUGLAS ALLOWAY,
CAROL AMELIO, DONALD BARNES, MARY-PATRICIA BARRY,
RANDY BAYRACK, JOANNE BEATON, MYRON S. BORYS,
BRUCE R. BRANDELL, HENRY C. BRUNS,
GARY CERANTOLA, DAN DELALOYE, RANDALL L. EDGAR,
JOHN R. HARRINGTON, HENRY P. LAZARENKO
ROY A. VITEYCHUK,
Appellants,
and
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR JUDGMENT
Rowe, D.J.
[1] Each appellant appealed from an assessment of income tax for the 1998 taxation year. Each appellant had been provided with a free parking pass by their employer – Telus Communications Inc. (Telus) either directly or through a wholly-owned subsidiary or division of Telus within a large organization generally known as Telus Group. The Minister of National Revenue (the "Minister") assessed each appellant on the basis the fair market value of the parking pass constituted a taxable benefit and added the applicable amount thereof into the taxable income of each appellant. Although the amount included into income of each appellant representing the fair market value of the parking pass provided by Telus varies, the common issue is whether the pass is a taxable benefit pursuant to the relevant provisions of the Income Tax Act. (the "Act") The position of the Minister is that the provision of those parking passes falls within the meaning of subsection 6(1)(a) of the Act.
[2] The appellants were represented by Mr. Curtis Stewart, Ms. Jasmine Sidhu and Mr. Michael Gemmiti. Counsel for the respondent were Ms. Rhonda Nahorniak and Mr. Kerry Boyd. Counsel for the respondents and counsel for the appellants agreed these appeals would proceed on the basis of common evidence to be applied - as required - to each appeal. Four of the parking facilities provided by Telus to employees – in 1998 - were located in Edmonton and one was in Calgary. Three of the appellants worked in Calgary and 13 were employed in Edmonton.
[3] Counsel for both parties agreed that a binder entitled Admissions of Facts and Documents be filed as Exhibit A-1. As the index indicates, the admissions at tabs 1‑7, inclusive, relate to admissions of facts and documents – referred to as Global Admissions – that relate to all 16 appellants. Thereafter, the admissions of facts and documents are specific to an individual appellant. In addition to the admissions contained in the Global Admissions, during the direct testimony of the appellant Mary-Patricia Barry, Curtis Stewart, counsel for the appellants, advised the Court that the answer provided below by Telus to each appellant for purposes of satisfying the question posed by the respondent in the process of written interrogatories was binding on all appellants. In responding to questions posed within the fourth set of interrogatories, each appellant had undertaken to ask Telus to advise which factors it had identified - in giving previous answers - upon which it had relied to issue a free parking pass. The response was as follows:
Telus has described in various answers the criteria it normally used in issuing parking passes to employees. Given the passage of time, it may be impossible to determine the specific factors Telus used in issuing a parking pass to each of the 50 appellants. Ultimately, it is likely that Telus would be forced to rely on the rationale provided by the particular Appellant who is in a much better position to know the particular reasons. Telus understands that in the previous answers provided by each particular Appellant, the Appellants have provided the factors he or she believed justified the issuance of a parking pass by Telus.
[4] Counsel for the appellants agreed there was no issue with respect to the fair market value of the parking passes issued by Telus to the appellants in 1998 as adopted by the Minister for the purpose of reassessing each appellant by including that amount into income. The thrust of the appellants’ contention is that the Minister was incorrect in assuming the parking pass primarily benefited an appellant rather than Telus or that the parking pass was a personal benefit conferred on an appellant because it facilitated travel to and from the workplace.
[5] All but one of the 16 appellants testified. In the course of testimony, most appellants dealt with many facts that were the subject of an admission – either Global – or those within Exhibit A-1 - applicable to a particular appeal. In the event some matters were not covered in the course of examination of an appellant on the witness stand and were relevant to issues before me, I have included those admitted facts after each segment of these reasons dealing with the evidence of a specific appellant.
[6] Richard George Schroter was examined by Mr. Stewart. Schroter testified he is a Chartered Accountant and is employed by Telus as a Director of Taxation. He began working for Telus in 1991 in the internal audit department and after 2 years was assigned to the tax group where he carried out various functions with increasing responsibility. In 1998, he was appointed Director of the Income Tax Section and supervises 20 employees. Schroter stated that in 1998, Telus was the sole provider of telecommunication services in Alberta. However, the Canadian Radio-television and Telecommunications Commission (CRTC) – in 1997 - provided a framework for competition within the telecommunication industry in Canada. Up to that point, British Columbia Telephone Company (BC Tel) operated in British Columbia, Telus in Alberta and Bell Canada Enterprises (Bell) in Ontario and Québec, basically without competition. The change in structure opened up the marketplace in Canada and required a major shift in business direction including the need to pursue certain acquisitions so Telus could operate in Ontario. In 1999, Telus merged with BC Tel. With respect to the issue of parking benefits provided to Telus employees, Schroter stated he was involved – in 1997 - with Canada Customs and Revenue Agency (CCRA), the predecessor of Canada Revenue Agency (CRA) pertaining to the 1994 taxation year. In that instance, Telus took the position that the primary benefit of the parking pass accrued to Telus rather than the employee. Two of the workers who were reassessed by the Minister to include the value of the parking pass into income as a taxable benefit appealed to the Tax Court of Canada and won their appeals. Schroter stated the issue of parking passes did not come up again until early March 2002, when the Minister reassessed certain Telus employees for the 1998 taxation year by including the value of the parking passes into their income. Schroter ascertained in the course of discussions with CRA officials that the agency did not consider itself bound by the two Tax Court decisions with respect to the same issue - in the 1994 taxation year - since those cases had proceeded by way of informal procedure and did not have precedential value. Schroter stated he knew Telus wanted senior employees to have vehicles readily available, especially for those who worked irregular shifts throughout the entire year. Telus did not want employees spending time travelling to the office from another work location nor did it consider the use of public transit to be adequate. As a Director of Taxation, Schroter relied on the earlier decisions of the Tax Court and retained counsel to appeal - pursuant to the General Procedure Rules - those assessments issued by the Minister on the basis the provision of free parking did not constitute a taxable benefit. Schroter stated he did not know the reasons for issuing parking passes to certain employees. Counsel referred Schroter to the binder - Exhibit A-1 – and to paragraph 11 of the Global Admissions which stated that - in 1998 – “for employees in pay bands 5 and 4, it was an implied condition that overtime would be expected where required to keep up to the workload and to ensure completion of projects on a timely basis, and such overtime was generally built into the employee’s overall compensation.” Schroter stated there were 7 pay bands in 1998. The first 3 pertained to entry-level employees working in clerical and support positions. Mid‑level managers, some senior staff and some professionals such as engineers, lawyers, accountants were included in pay bands 4 and 5. The General Manager and various vice-presidents and other business leaders were remunerated pursuant to pay bands 6 and 7. Schroter stated there was a lot of work that had to be performed in 1998 because of the number and breadth of projects in Canada designed to expand the business operation of Telus. The investigations required before merging with BC Tel or prior to acquiring other companies generated a substantial volume of work for managers and senior employees, all of whom were expected to work as long as necessary to complete their tasks. In order to carry out these onerous duties, Telus wanted its managers to have the ability to travel, as required. The Telus policy with respect to reimbursing employees for taxi fares is stated in paragraphs 3, 4 and 5 of the Global Admissions. Summarizing the admissions in paragraphs 6, 7 and 8, Schroter stated Telus did not carry out any analysis to determine whether it was an economic advantage to Telus to provide parking to its employees rather than reimbursing them for taxi fares nor whether it was cost-effective to provide parking to its employees as opposed to paying for taxis nor was any analysis undertaken to compare the cost of requiring employees to use their own vehicles in the course of their duties rather than reimbursing them for taxi fare.
[7] Schroter was cross-examined by Rhonda Nahorniak. He acknowledged that he was Manager of Taxation in 1998. Since then, the duties of that position have evolved and the title is now Director. In the course of dealing with CRA officials with respect to the parking pass issue, he was assisted by two other members of his group, Ken Bagnall and Trevor Edmundson. CRA submitted queries which were completed in writing and returned and meetings were held on a regular basis with the CRA audit team. Schroter identified a document – Exhibit R-1 – dated November 2, 1999 - as the Telus response to CRA inquiries. He wrote a letter – Exhibit R-2 – dated January 25, 2002 - to Don Cloutier, Verification and Enforcement Division of CCRA. Schroter agreed the position stated in paragraph 3 of said letter is the same today, namely, that Telus provides parking for certain employees because it is primarily to its advantage to do so considering the nature of the duties carried out by the recipients of these passes and their rank within the organization which requires them to work irregular hours, extra hours, and to work on weekends and holidays. Counsel referred Schroter to a Telus document entitled Compensation Policies and Guidelines – Variable Pay – Exhibit A-1, tab 4 – effective January 1996. Schroter stated he thought that policy was in effect during 1998 and also applied to Telus wholly-owned subsidiaries. He acknowledged the wording of the portion of said document – p. 12/74 – which stated perquisites “are kept to a minimum and are provided in order to be market competitive or to enhance an individual’s ability to perform their role.”
[8] Daniel (Dan) Henry Delaloye - examined by Curtis Stewart - testified he is Chief Executive Officer of Celera Solutions Inc. He started working for Alberta Government Telephones (AGT) - the predecessor of Telus - in 1993. In 1998, at Telus, he was Vice President, Card, Operator, Pay Phone Services, a position in pay band 6. He was responsible for 3 offices in Edmonton, 3 in Calgary and one each in Grande Prairie and Lethbridge. In 1997, he moved to Calgary in order to supervise a new division of Telus and was issued a parking pass for the lot in Telus Tower at 411 – 1st St. SE in downtown Calgary. Delaloye stated he worked long hours in 1998 and travelled by car to pay phone offices at locations within Calgary. Part of his duties was to attend various community functions including United Way which held meetings at 7 a.m. and to participate in activities undertaken by Theatre Calgary and other organizations with the view to increasing the visibility of Telus. Delaloye estimated one-third of his time was spent away from the office in 1998. Executive meetings were held in Edmonton and, if he needed a vehicle there, drove from Calgary. Since joining Telus in 1993, he had always been assigned a free parking pass and considered it “absolutely essential” in order to provide him with the opportunity to commute during the day and visit clients such as CP Hotels that owned or operated facilities in various locations, including Banff or to attend at the Calgary Airport Authority offices or at Telus pay phone offices in Calgary. In his opinion, it was extremely difficult to use other means of transportation to carry out his responsibilities to Telus. He did not consider the parking pass was a significant item in terms of compensation since a new card was issued about every 36 months without having to apply for a renewal.
[9] Delaloye was cross-examined by Kerry Boyd. He conceded that driving his own car allowed him to commute to and from work at convenient times. His assigned parking space was a reserved stall, underground, in a heated parkade. While attending at other Telus offices or when attending functions at night on behalf of Telus, he used public parking and was reimbursed by Telus for the cost. He acknowledged he was permitted to park in the space for personal use – such as shopping – but cannot recall having done so as it was not conveniently located to the stores. He agreed he could have taken the LRT public transit from his residential area in Lake Bonavista and that there was a station within 4 blocks of the Telus Tower. Delaloye stated he did not have any documentation with respect to the reason Telus provided him with a vehicle – 1997 Honda Acura - but assumed it was inherent in the position he occupied. He paid income tax on the personal use portion of the vehicle on the basis it constituted a personal benefit. He knew about the Telus policy of reimbursing employees who used their own vehicles in the course of their employment. He was aware of a memorandum establishing his position but did not have a written employment contract nor was there an official job description pertaining to his role in 1998. Delaloye stated his out-of-town travel to Toronto, Vancouver and various cities in Alberta occupied about 70 days. According to the log – Exhibit A-1, Delaloye label, tab 2 – he used the vehicle 137 days and the business portion of total distance driven was 70%. Telus had its own air service but the aircraft were often full and he had to travel by commercial airlines. The pay phone office in West Calgary was located in a residential area and Delaloye was able to park without paying. He agreed that parking lots in the vicinity of Telus Tower in downtown Calgary all charged for parking space. Delaloye stated he worked from home a few days in 1998 and could control his hours in the sense he did not “punch a clock.” He held an executive position and worked long hours. In his opinion, without the convenience of a parking pass, he would not have been able to fulfill his responsibilities by using public transit or taxis because some days he made 4 or 5 trips away from his office to locations in Calgary. Delaloye stated that without a reserved parking space he probably would not have worked on Saturday. He agreed he had provided an answer to a written interrogatory that he did not contribute additional hours of work – in 1998 – as a result of Telus providing the parking pass. He stated he believed the parking pass allowed him to be more effective and productive. He acknowledged it would be difficult to calculate the amount of any saving to Telus but considered it reasonable to assume that each time one called for a taxi the waiting time would be at least 15 minutes. In his view, that wasted time could amount to thousands of dollars per year in otherwise billable executive hours, even though Telus had not carried out any analysis to support this theory. Delaloye participated in the variable pay program and received a bonus in excess of $47,000 according to the Direct Deposit Statement – Exhibit R-3 – which indicated his hourly pay rate was $68.97.
[10] In re-examination, Delaloye stated he was responsible for various business decisions and considered it essential that he have a vehicle at his disposal together with an assigned parking space within Telus Tower.
[11] (The following facts were admitted by Delaloye in these numbered paragraphs of the admissions found behind his label in the binder, Exhibit A-1.)
5. I did not keep or submit to Telus any records of any overtime I worked in 1998.
9. I had access to the parking lot with the parking pass 24 hours per day, 7 days per week in 1998.
11. In 1998 there was never a time where there were no parking stalls available to me within the parking lot.
13. In 1998 I made use of the parking pass approximately 3 days per week as I traveled throughout Alberta and Canada the remainder of the week.
14. In 1998 I used the parking pass to attend community functions located near Telus Tower approximately 20 to 40 times.
[12] Myron S. Borys – examined by Curtis Stewart - testified he is employed as Vice President of Edmonton Economic Development Corporation. In 1998, he worked for Telus as Director of Consumer Internet Services, a strategic business unity comprised of several groups reporting directly to him. He functioned as general manager to those groups including the help desk service which had more than 200 employees. Other groups within the business unit had up to 40 employees. The help desk operated 7 days a week, 24 hours a day and was structured in two tiers with the second level being staffed by more technologically-advanced personnel capable of dealing with problems unresolved by the initial responder. Borys stated the internet services division was the fastest-growing unit within Telus and the milestone of 100,000 customers was attained. In order to compete with other service providers, Telus introduced high-speed internet connection. Borys stated he was at work before 8 a.m. and worked until 5:30 or 6:00 p.m. and considered those hours to be normal in view of his managerial position - in pay band 5 - which required extra hours of work to carry out his duties. He understood his pay rank had been structured to take into account that he would need to work additional hours which would – otherwise – have been considered as overtime. He used his own vehicle for Telus business purposes “a couple of days a week.” In his opinion, it was not convenient to take a bus to off-site meetings and the frequency of bus service after 6 p.m. was reduced, leading to longer wait times. In 1998, his household had just one vehicle so he took the bus to work often but when he had to arrive early or leave late he used the family car. Telus policy allowed employees to take taxis for business and to claim reimbursement. Borys stated he had a parking pass but did not have an assigned stall. Instead, the parking privilege was on a “first come, first served” basis but he was always able to find a space. In his opinion, the ability to park his vehicle enhanced his ability to carry out his work. On occasion, he needed to work at the office during a weekend to access the computers, printers and related equipment in order to prepare presentations. He estimated that he used the Telus parking lot once or twice a year for personal reasons.
[13] Borys was cross-examined by Rhonda Nahorniak. He stated his understanding that objectives were established by his supervisor and that a bonus was based on meeting or exceeding those goals. He considered the provision of free parking to be part of his overall compensation since receiving a pass - in 1994 – when employed as a Manager with Edmonton Telephones (Ed Tel), a company subsequently acquired by Telus. He acknowledged Telus did not require him to own or operate a vehicle in the course of his employment nor did his position demand that he hold a valid driver’s licence. Borys estimated he used his vehicle 2 days per week - approximately 100 times per year - and although he knew Telus paid employees for using their personal vehicle for business, could not recall having submitted any expense claims for that purpose in 1998. He agreed Telus was not concerned whether he brought his vehicle to work. As for bus service on Route 66, he acknowledged there was one bus stop approximately 500 metres from his residence and another approximately 7 blocks away and that the service was every 15 minutes in the morning, starting at about 6:30. Borys agreed the parking pass was convenient and reduced travel time to and from work. In 1998, he was not aware of any free parking available on a daily basis in downtown Edmonton. He stated he may have found alternative modes of transportation if he had been required to pay for his parking space. In his opinion, the parking space was most useful when he worked two weekends a month - sometimes as late at 7 p.m. – because bus service was less frequent during those periods. Borys identified the print-out of his 1998 expense claim - behind his label in Exhibit A-1 – and entries showing reimbursement for taxi fares totalling $1,400.00. He stated Telus policy was to pay for taxis for business purposes even if an employee had brought a vehicle to work. Borys stated sometimes for business travel, he took a taxi to work and then to and from the airport. He was not aware of any reasons for Telus having issued him the parking pass.
[14] (The following facts were admitted by Borys in these numbered paragraphs of the admissions found behind his label in the binder, Exhibit A-1.)
3. In 1998 I resided at 8703 - 42 Avenue, Edmonton, Alberta.
5. In 1998 my scheduled hours of work were 7.5 hour work days from 8:00 a.m. to 4:30 p.m..
6. Despite my scheduled hours of work, in 1998 I worked 1 to 3 hours of overtime per day virtually every day and 4 to 6 hours of overtime in the office on the weekend approximately once per month and at home 1 to 2 times per month.
7. I did not keep or submit to Telus any records of any overtime I worked in 1998.
9. I did not have to apply for my parking pass.
10. The parking pass was available to me for the entire year of 1998.
11. In 1998 my parking pass was for the parking lot located in Telus Plaza at 10020-100 Street in Edmonton, Alberta.
12. I had access to the parking lot with the parking pass 24 hours per day, 7 days per week in 1998.
20. Prior to receipt of the parking pass, I traveled to work by bicycle, public transportation, or car.
21. Prior to receipt of the parking pass, when I traveled to work by car I parked in a daily surface parking lot and paid from $5.00 to $7.00 per day.
22. I did not complete a form T2200 for the 1998 taxation year.
27. In 1998, when traveling from work to home, bus route 66 departed downtown for home approximately every 15 minutes from 4:18 p.m. to 5:33 p.m..
[15] Douglas Alloway – examined by Curtis Stewart - testified he is employed by Telus as a Director of Human Resources for Telus and held that position in 1998 where he was responsible for 3 business units and provided support in relation to 1,600 employees. His scheduled work day was from 8:00 a.m. to 4:30 p.m. but – usually - he arrived at work around 7:00 a.m. and left about 5:30 in the afternoon. In 1998, his position did not require him to have a vehicle to carry out his duties nor was it a condition of employment. He did not submit expense accounts to Telus – in 1998 – in respect of use of his vehicle. Alloway stated he had to attend a work site in the Greater Edmonton area about two or three times a week in order to deal with a human resource problem and that it was much easier to use his vehicle which was parked in Telus Plaza. Although Telus had a pool of vehicles for use by certain employees, Human Resources personnel were not included in that category. In Alloway’s opinion, the parking pass permitted him to start work earlier and stated he used the pass only two or three times for personal reasons in 1998. Prior to 1994, he rode the bus to work and considered he may have done so in later years if he had not been provided with the parking pass.
[16] Alloway was cross-examined by Rhonda Nahorniak. He conceded he had not kept any record of hours worked in 1998 and that he worked overtime in order to achieve a promotion and receive better raises. As a Director in pay band 4 , he felt he should work extra hours to justify the privilege of having received – without asking - the parking pass in 1996. In 1998, he used his own car to drive to Edmonton International Airport as there was no direct public transit from his residence. Although he used his vehicle about 1000 kilometres for Telus business purposes in 1998, he did not submit an expense claim. In his opinion, it was reasonable to assume that if he needed to take 8 to 10 taxi trips per month, that total cost would have exceeded the value of his parking space.
[17] (The following facts were admitted by Alloway in these numbered paragraphs of the admissions found behind his label in the binder, Exhibit A-1.)
12. I had access to the parking lot with the parking pass 24 hours per day, 7 days per week.
13. In 1998 there was never a time where there were no parking stalls available to me within the parking lot.
24. In 1998, the nearest bus stop was two blocks from my residence.
[18] Gary Cerantola was examined by Jasmine Sidhu. Cerantola stated he is currently self-employed but was employed by Telus – in 1998 – as a Direct