BARE BONES BRIEFS: Maple Leafs' captain fighting CRA demand for $6.8 million | LST: Child abuser can practise law | Alberta CA justice joins BLG | Remote work, wellbeing slow law firm productivity | Bullying of law students 'relatively high'

By Julius Melnitzer | March 25, 2024

TAVARES TAKES ON CRA

Maple Leafs’ captain John Tavares is fighting the CRA’s claim that he owes $6.8 million in taxes for 2018, when he signed a seven-year US$77 million contract with the team and moved from New York to Toronto. The agreement included a $70.8 million bonus, $15.4 of which was payable on July 1, 2018, before he relocated to Canada. When the team paid the bonus, it withheld 15%, or some $2 million, by way of its withholding tax obligations under the Canada–U.S.A. Tax Treaty. Tavares reported the bonus on his 2018 US tax return and claimed a foreign tax credit for the amount withheld.

But, as explained by Toronto tax boutique Rotfleisch & Samulovitch P.C., the CRA audited Tavares’ 2018 return and concluded that the Treaty did not apply to his bonus. The bonus, CRA reasoned, was not an “inducement to sign an agreement relating to the performance of the services of an athlete” (as opposed to an athlete’s regular salary) which would justify the treaty-reduced 15% tax rate ($2 million) as opposed to the $6.8 million the CRA now claimed was owing. Tavares argues that the bonus was an “inducement” because it applied whether he actually played for the Leafs or not. The outcome is unclear: there are no reported cases on the issue at the Tax Court of Canada, say Rotfleisch & Samulovitch.

APPEAL CONFIRMS CHILD SEXUAL ABUSER’S RIGHT TO PRACTISE

A man who sexually abused minor children in 2009 and failed to disclose the incidents on a previous licensing application to the Law Society of Ontario in 2012 may now practise law after the Law Society Tribunal dismissed an appeal from the Hearing Division’s finding that he was now of good character. The Hearing Divison’s restriction that the man not meet with minor children while unsupervised remains in place.

PAPERNY JOINS BLG

Former Alberta Court of Appeal Justice Marina Paperny has joined Borden Ladner Gervais LLP’s Calgary office, where she will focus on litigation consulting and dispute resolution. According to a press release, Paperny, who served for 27 yerars with the Alberta, Northwest Territories and Nunavut Courts of Appeal, as well as the Court Martial Appeal Court of Canada and the Court of King’s Bench in Alberta, also has experience as president and general counsel of a private investment firm focusing on real estate development and medical imaging. Paperny has roots at BLG, having become a partner at Howard Mackie, the predecessor to BLG in Calgary, in 1982.

LAW FIRM PRODUCTIVITY TANKS AGAIN

The Law Society of England and Wales recent benchmarking survey reveals that productivity flagged for the second year in a row as median chargeable hours per fee-earner dropped from 816 in 2022 to 793 in 2023. According to The Law Society Gazette, law firm leaders believe that “a confluence of remote working and the ‘wellbeing’ agenda appears to be changing attitudes to work, mainly (but not only) among junior lawyers.”

DISABLED LAW STUDENTS , WOMEN SUFFER MOST FROM BULLYING

A UK Bar Council survey has found that 20% of trainees at law firms have suffered from bullying, harassment and/or discrimination. While the incidence is lower than among lawyers in general, and the figures represent a one percent drop from 2022, bullying suffered by disabled trainees (41%) was more than three times compared with those who had no disability (13). Women (28) were bullied more than nine times as frequently as men (3%) were. According to The Law Society Gazette, gender (39), race (30) and disability (25) were the most common types of abuse. Barristers were responsible for 43% of the reported incidents, and judges (16) were also implicated.

Julius Melnitzer is a Toronto-based legal affairs writer, ghostwriter, writing coach and media trainer. Readers can reach him at [email protected] or https://legalwriter.net/contact.