Executive Summary: Key Legal and Evidentiary Issues

• Appellant's GST/HST New Housing Rebate applications for three Ontario properties were denied due to questions about her intended use and first occupancy of the properties under paragraphs 254(2)(b) and 254(2)(g) of the Excise Tax Act.

• Respondent's motion to compel answers to over 45 written discovery questions was granted on a substantial majority of the disputed questions, with the Court finding the Appellant's objections largely without merit.

• Privacy, intrusiveness, and concerns about being characterized as a property investor were rejected as valid grounds for refusing to answer discovery questions.

• Several of the Appellant's responses were deemed evasive, unresponsive, or "non-answers," particularly regarding property occupation dates, sale details, and listing information.

• Court affirmed that discovery does not shift the evidentiary burden but rather enables both parties to access evidence in the other's possession to avoid trial by ambush.

• Costs of the motion were awarded to the Respondent in accordance with the Tariff, in any event of the cause.

Background of the dispute

Thuy Bich Thi Le, a self-represented appellant, appealed notices of assessment denying her applications for the Goods and Services Tax/Harmonized Sales Tax New Housing Rebate in respect of three properties she acquired in or around 2021. The properties were located in Oakville, Ontario, Kingston, Ontario, and Bracebridge, Ontario. The assessments rested on two grounds: first, that at the time each purchase and sale agreement was signed, the Appellant did not intend the property to be used as a primary place of residence by herself or a "qualified relation," as required by paragraph 254(2)(b) of the Excise Tax Act; and second, that neither she nor a qualified relation was the first to occupy the properties after substantial completion of the construction or renovation, as required by paragraph 254(2)(g) of the Act. In her Notice of Appeal, the Appellant stated she had every expectation of residing in each property with her family but that occupancy became impractical due to personal, financial, and family circumstances without providing further detail.

The Respondent's motion to compel discovery answers

On October 21, 2025, the Respondent served the Appellant with written questions on examinations for discovery. The Appellant responded to some but not all of those questions. The Respondent, represented by counsel James Whittier, filed a written motion on January 26, 2026 to compel the Appellant to provide answers to the unanswered or insufficiently answered questions, covering more than 45 individual items. The Respondent also sought an amendment to the existing timetable order and costs. The Honourable Justice Lara G. Friedlander heard the motion in writing.

Legal framework applied by the Court

Justice Friedlander relied on subsection 95(1) of the Tax Court of Canada Rules (General Procedure), which requires a person examined for discovery to answer any proper question relevant to any matter in issue. The Court cited the leading decision in Lehigh Cement Ltd. v The Queen, 2011 FCA 120, which establishes that the general purpose of discovery is to render the trial process fairer and more efficient by allowing each party to fully inform itself of the other's positions. A question is relevant when there is a reasonable likelihood it might elicit information that may directly or indirectly enable the party seeking the answer to advance its case or to damage the case of its adversary. The Court also referenced Malik v The King, 2025 TCC 193 and 506913 N.B. Ltd. v The Queen, 2016 TCC 286, underscoring that the threshold for relevance at the discovery stage is low and that only questions concerning matters that are clearly or completely irrelevant should be rejected.

The Appellant's objections and the Court's response

The Appellant raised various objections across the contested questions, including claims that the motion improperly attempted to shift the evidentiary burden, that discovery was being used to construct the Minister's case, and that specific questions were irrelevant, overly broad, speculative, intrusive, disproportionate, constituted fishing expeditions, or violated the privacy of third parties. The Court rejected the contention that discovery shifts the evidentiary burden, noting that the party bearing that burden — in most federal income tax and goods and services/harmonized sales tax cases, including this one, the appellant — is entitled to use evidence obtained through discovery and is not limited to what it can find independently. The Court also held that privacy and intrusiveness are not valid bases for refusing discovery questions, and that concerns about being characterized as a property investor do not justify refusal either, as the Appellant would have opportunity to address any such potential characterization at trial.

Rulings on the seven groups of questions

The Court organized the disputed questions into seven thematic groups. For Group One, covering educational background and employment history, the Court found these questions relevant to assessing the Appellant's intentions in light of her pleaded personal, financial, and family circumstances. For Group Two, addressing real estate experience and residential history, the Court held that a pattern of buying and selling residential properties is relevant in the context of the Rebate and that occupancy history helps determine the element of permanence supporting the intention to acquire a property for use as a primary residence. For Group Three, where the Appellant claimed the requested information was already in documents previously provided, the Court agreed with the Respondent that merely stating the response is in the documents provided is not a response to the question and that the Appellant had not indicated where the relevant information was to be found. For Group Four, where the Respondent alleged the Appellant's answers were insufficient, the Court found the responses to be vague, generally unresponsive, and amounting to "non-answers." For Group Five, concerning loans and financial transactions linked to the properties, the Court accepted that some of the Appellant's responses, while somewhat vague, did not quite rise to the level of "non-answers," and therefore declined to compel further responses to Questions 35(b), 35(c), 36(b), 36(c), 37(b), 37(c), 48(a), and 48(b) — though it noted the Respondent is entitled to pose follow-up questions, which may be numerous and detailed. However, for Question 55 regarding down payment assistance for the Bracebridge Property and the portion of Question 63 regarding the reason for the sale of that property, the Court found the responses were "non-answers" and compelled substantive replies. For Group Six, concerning third-party contact information, the Court relied on subsection 95(4) of the Rules to hold that the examining party is entitled to names, addresses, telephone numbers, and email addresses of persons who might reasonably be expected to have knowledge of relevant transactions or occurrences. For Group Seven, addressing incomplete production of purchase and sale agreements, the Court ordered the Appellant to produce the entirety of those agreements or explain why she is no longer in possession of the relevant pages.

Outcome and costs awarded

Justice Friedlander granted the Respondent's motion on March 6, 2026, ordering the Appellant to answer the substantial majority of the contested discovery questions and produce the requested documents by April 30, 2026. A revised timetable was set for follow-up questions by May 29, 2026, answers to follow-up questions by July 6, 2026, and a filing deadline of August 21, 2026 for the parties to either file a joint application to fix a time and place for the hearing, request a settlement conference, or confirm that the appeal will settle. The Respondent, His Majesty the King, was the successful party on this motion and was awarded costs in accordance with the Tariff, in any event of the cause. No specific monetary amount was determined or awarded in this interlocutory order, as the underlying appeal on the merits of the Rebate denial has yet to be heard at trial.