VA Miller J found that the Minister's decision to use a net worth assessment, and impose penalties on the taxpayers based on the amount thus determined, was justified.
The documents were provided to CRA in an unorganized garbage bag, and in a box that was contaminated with mouse droppings and had many documents shredded by the mice. It was unreasonable to require the official handling the case to handle the records and risk her health (para. 19). Moreover, to the extent that documents could be recovered, they supported CRA's position that the taxpayers had concealed income.