In Grenon v Canada Revenue Agency, 2017 ABCA 96, the Alberta Court of Appeal upheld the decision of the Honorable Justice Dario wherein she concluded that the Canada Revenue Agency does not owe a duty of care to taxpayers in conducting audits:
Grenon v Canada Revenue Agency, 2017 ABCA 96 - https://www.canlii.org/en/ab/abca/doc/2017/2017abca96/2017abca96.pdf
I quote from the decision:
“[25] In our view, it is plain and obvious that an action in negligence cannot succeed. It is clear that, because of the inherently adverse relationship between auditors who are exercising a statutory function and taxpayers, a finding of sufficient proximity to ground a private law duty of care does not exist. The chambers judge correctly applied the Cooper-Anns test and considered foreseeability and proximity to reach the same conclusion. Not only is her decision entitled to deference, the chambers judge could have gone further to conclude that public policy considerations also militate against finding the existence of a prima facie duty of care in this case.”
The Financial Post commented on this decision and the vulnerability of ordinary tax payers in a summary of another partially successful claim against the Canada Revenue Agency for damages:
https://business.financialpost.com/opinion/when-the-cras-bullying-came-back-to-bite-it-offshore-tax-audit-results-in-5-million-in-damages
“The CRA’s conduct in this matter is troubling. More troubling are the facts that ordinary Canadians without deep pockets are often at the mercy of the CRA and that, had the case been governed by the laws of any other province or territory instead of Quebec civil law, the taxpayers might not have prevailed: In 2017, the Alberta Court of Appeal held that the CRA cannot be sued for negligence in the performance of an audit.”
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