The taxpayer was the sole shareholder and director of Internorth Limited ("IL") and a majority shareholder and director of Internorth Construction Company ("ICC"). ICC ran a construction business, and IL was incorporated to manage ICC. The minister assessed the taxpayer for unremitted source deductions in respect of salaries and wages paid to ICC employees. However, the taxpayer was able to establish that IL was only paying those amounts as an agent of ICC, and in fact IL had no employees at all. Because the taxpayer was assessed only in his capacity as a director of IL, and the obligation to remit source deductions lay with ICC, the taxpayer's appeal was granted.
Webb J. also specifically noted (at para. 25) that a director in a director's liability case is able to challenge the correctness of the assessment giving rise to the liability in issue.