"Bekesinski": Backdating, Credibility And Proper Procedure To Avoid A Director’s Liability

In Bekesinski v The Queen, 2014 TCC 245, the Tax Court of Canada ("TCC") allowed a director's liability appeal to eliminate a personal liability totaling over $477,000, despite serious misgivings about the appellant's evidence, by assiduously applying basic tax litigation principles.  Mr. Bekesinski's defense was that he resigned more than two years before the assessments were issued and was therefore protected by the two-year limitation period in ss. 227.1(4) of the Income Tax Act ("Act").  The Minister of National Revenue ("Minister") argued that the resignation was not effective because it was backdated, thus fabricated.  Despite the TCC's belief that the resignation had been backdated, Mr. Bekesinski's appeal was allowed based on the evidence before the TCC, through a correct albeit strict application of tax litigation principles.