Prior to its bankruptcy, the appellant granted a general security agreement ("GSA") to its parent and related companies as security for a $6 million advance. In the appellant's name, the receiver for the secured creditors appealed the Minister's denial of input tax credit claims of the appellant. The trustee in bankruptcy had already accepted the GSA as valid, waived redemption of the security and released the interests of the general creditors in the collateral (i.e., essentially all the appellant's assets, as the secured creditors' claim exceeded the value of the bankrupt estate), but had not specifically authorized the present proceedings.
The Minister applied to dismiss the claim on the basis of the lack of legal capacity of the receiver to bring the claim (i.e., that only the trustee could bring the claim).
After noting (at para. 17) that he "would likely have concluded in this instance that the prior assignment of the book debts (choses in action) under the GSA has otherwise validly transferred the rights to the referable property enumerated under sections 301 (person assessed may file an objection) and 306 (objector receiving or deemed to receive a confirmation may file an appeal)" he quoted ETA s. 266 (including "the receiver shall be deemed to be an agent of the [debtor]") and found (at para. 18):
[A] secured creditor, acting as a "receiver" in respect of part of the property of the debtor under a "debt security", becomes an agent under subsection 266(1) and is not precluded from objecting to a GST assessment or reassessment in respect of certain property assigned (the book debt) and maintaining thereafter the appeal which follows.