The former owner of a series of logging companies has been ordered to pay Canada Revenue Agency $80,000 in taxes owed before he can be discharged from bankruptcy.
Dale Edward Janzen, who lives in Quesnel, persistently ignored his tax obligations and had a history of non-compliance that goes back more than 20 years, according to a reasons for judgment issued Wednesday .
Janzen not only ran up debts to the CRA for income tax and goods and services tax but also failed to forward payroll deduction remittances to the federal government's tax collector. Over those 20 years, he formed five companies but only one of them has paid its liabilities in full.
"When the CRA obligations became too high, he abandoned that company and started a new one," B.C. Supreme Court Master Heather MacNaughton said in her ruling.
By the end of it all, Janzen owed the CRA more than $900,000, making it by far his largest creditor. He filed for bankruptcy to escape those tax obligations.
CRA had been seeking $200,000 but MacNaughton settled on $80,000 as an appropriate amount, given his current medical and employment situation. Now 60 years old, Janzen has had a coronary bypass and a stent inserted in an artery and is scheduled for further heart surgery. He works for his daughter, earning a net pay of $600 every two weeks.
The CRA had argued his daughter's business was still really his, saying it had the same customers and employees from his previous operation. However, MacNaughton said the CRA did not provide evidence to support the conclusion and did not cross-examine Janzen.
Janzen also made some effort to pay back what he owed. In 2006, he paid CRA about $80,000, received as a result of transferring his interest in his family home to his wife. However, he could not account for the $62,000 withdrawn from his logging company's account in the months leading up to his assignment into bankruptcy.
Janzen blamed his accountant for the trouble and implied that he was "merely a logger," but MacNaughton thought otherwise.
"He knew or ought to have known that he was deducting statutory withholdings from his employees and collecting GST and was in breach of his responsibility to remit those to the CRA," MacNaughton said.
Janzen must pay the CRA back in installments of at least $500 per month starting in July.
