Executive Summary: Key Legal and Evidentiary Issues

• Allan Albert Fe Virrey, a self-represented litigant, appeals the reassessment of his 2022 taxation year, claiming his income as an ICRC employee is exempt from taxation.

• The Respondent moved to strike the Appellant's Answer for non-compliance with subsections 50(1) and 51(3) of the Tax Court of Canada Rules (General Procedure).

• New facts, statutory provisions (subsection 126(3) of the ITA and section 2 of the FMIOA), and grounds of claim were improperly introduced in the Answer rather than through an amendment to the Notice of Appeal.

• Confusion arose from the filing of two Notices of Appeal — a detailed initial version and a less comprehensive replacement in the required Form 21(1)(a) — resulting in key material facts being lost from the court record.

• An opportunity to resolve the pleading dispute informally between the parties was declined by the Appellant, leading to the formal motion before the Court.

• Costs of $250 were awarded to the Respondent as a result of the motion.

The underlying tax dispute

Allan Albert Fe Virrey was employed by the International Committee of the Red Cross (ICRC), a globally recognized humanitarian organization. When the Canada Revenue Agency (CRA) reassessed his 2022 taxation year, it denied a tax exemption for the income he earned as an ICRC employee. The CRA's position was that the ICRC is not a "prescribed international organization" under the Income Tax Act (ITA). Mr. Fe Virrey disputed this assertion, contending that the ICRC's recognized international status qualifies it for tax exemption under Canadian and international law. After the CRA issued a Notice of Confirmation upholding the reassessment, Mr. Fe Virrey appealed to the Tax Court of Canada.

The filing of the Notice of Appeal

On December 19, 2024, Mr. Fe Virrey filed his first Notice of Appeal, titled "Statement of Issues and Reasons of Appeal," which included fifteen supporting documents — primarily letters and documents exchanged with the CRA during the objection process. However, a registry officer of the Court contacted Mr. Fe Virrey by phone on December 23, 2024, to advise him that proceeding under the General Procedure required a Notice of Appeal in the prescribed Form 21(1)(a). He was further told that the documents attached to his original filing would be shredded, and that he would have to file them in accordance with the rules of evidence at the hearing if he wanted to rely on them. Mr. Fe Virrey complied and filed a new Notice of Appeal in the correct form later that same day, though this version did not contain as many details as the first Notice of Appeal filed on December 19, 2024.

The Respondent's Reply and the Appellant's Answer

On March 13, 2025, the Respondent filed a Reply to the Notice of Appeal, limited to the valid Notice of Appeal dated December 23, 2024 — the one that uses Form 21(1)(a) as required by the Rules. The Reply was limited to facts and arguments that relate to the definition of "prescribed international organization" and the status of the ICRC and the Appellant with respect to the United Nations. Notably, paragraph 7 of the Reply specified that the material facts contained in the Notice of Appeal titled Statement of Issues and Reasons for Appeal filed on December 19, 2024, did not form part of the Notice of Appeal. On March 14, 2025, Mr. Fe Virrey filed an Answer entitled "Appellant's Reply to Respondent's Reply," which the Respondent moved to have set aside in whole pursuant to section 7 of the Rules.

The motion to strike the Answer

The Respondent argued that the Answer should be set aside in whole because it failed to comply with subsections 50(1) and 51(3) of the Rules. Under subsection 50(1), an answer must state which new facts in the reply are admitted, denied, or of which the appellant has no knowledge and puts in issue, and may include facts material to the facts pleaded in the reply, further statutory provisions relied on, or other reasons the appellant intends to rely on. Subsection 51(3) provides that an allegation raising a new ground of claim shall not be made in a subsequent pleading but by way of amendment of the previous pleading. The Respondent contended that the Answer newly introduced subsection 126(3) of the ITA and section 2 of the Foreign Missions and International Organizations Act (FMIOA), and advanced new statements of fact and mixed fact and law, reasons, and a ground of claim that were not pleaded in the Notice of Appeal and were not related to facts pleaded in the Reply.

The Court's analysis

Associate Judge Sophie Matte agreed with the Respondent that the Answer does not comply with the Rules. The Court found that the Answer did not state the new facts raised in the Reply that are admitted, denied, and of which the Appellant has no knowledge and puts in issue. Furthermore, the Court confirmed there was no reference to subsection 126(3) of the ITA or section 2 of the FMIOA in the Notice of Appeal, and no facts had been pleaded that support the allegation that the ICRC is an organization that meets the definition of "international organization" of the FMIOA. The statements of fact and mixed fact and law, reasons, and ground of claim that rely on these provisions were all introduced for the first time in the Answer. The Court noted that the new facts introduced in the Answer were not related to new facts alleged in the Reply. The Court acknowledged that Mr. Fe Virrey may have felt the facts were not new because they had been part of his original December 19 filing and shared with the CRA during the objection process, but those documents no longer formed part of the Notice of Appeal, and information shared with the CRA during the objection process does not form part of the Court file. Self-represented litigants, the Court noted, must reasonably comply with the Rules to ensure that the litigation proceeds in an orderly, efficient and fair manner.

A missed opportunity to resolve the matter informally

The Court observed that the Respondent had written to Mr. Fe Virrey prior to filing the motion, offering him an opportunity to amend his Notice of Appeal under the condition that he would allow the Respondent to amend its Reply. Mr. Fe Virrey felt that it was more appropriate and fairer to all parties to maintain communications with the Court's formal process. While the Court understood Mr. Fe Virrey's reticence to communicate with counsel, it found it unfortunate that it resulted in a motion being filed with the Court, noting that it is common and encouraged for parties to discuss and resolve such issues between themselves.

The ruling and its outcome

The Court ordered the Answer set aside in whole as an improper pleading constituting an irregularity within the meaning of section 7 of the Rules. However, in the interest of justice, Associate Judge Matte allowed Mr. Fe Virrey to file and serve an Amended Notice of Appeal by February 27, 2026, recognizing that material facts may have been lost between the two Notices of Appeal and the ones included in the Answer. The Respondent was given 60 days from the service of the Amended Notice of Appeal to file and serve a Reply. The Respondent, as the successful party on the motion, was awarded costs in the amount of $250.