Businessman Kim Wai Chee and two Brads gaming companies have lost a major court battle over millions of dollars in tax assessments tied to Boledo and Jackpot operations. The High Court rejected their challenge, with Justice Nadine Nabie ruling that the claim was misconceived and amounted to an abuse of the court’s process. While the judge accepted that Chee and Brads Gaming Company Limited had standing to sue, she found that they had skipped the proper legal route by coming to court before using the statutory review process available under the Tax Administration and Procedure Act. Here’s Senior Counsel Magali Marin on the High Court ruling.
Magali Marin
Magali Marin, SC, Attorney-at-law
“ Under the Tax Administration and Procedure Act, there is an review and appellate process that each taxpayer is afforded and could exhaust before going directly to the high court. So when a taxpayer gets an assessment, that taxpayer can ask for what is called a review. And if unsatisfied with that review, there is a appellate body that that taxpayer could appeal to, and ultimately a further appeal to the high court. But Mr. Kim Wai Chee and these companies didn’t do that. They allege breach of their fundamental rights. They question the lawful jurisdiction of the director general in doing these assessments and these bes- best judgment assessments. They find every. Fault and reason why there was non-compliance as far as they were concerned by the director general with the law. So they challenged her. They brought a constitutional motion as well as they also sought administrative relief to say that the director general acted outside of her powers under the legislation. They alleged that there was a breach of their fundamental rights to protection of the law, breach of their equal protection of the law, breach of their right to natural justice and fairness and all that. So we went to trial last year and the judge in a fifty-page judgment, Justice Nabi, took her time to rule on every single technical challenge that was raised by the claimants and she found that there was absolutely no breach of the fundamental rights. Two, that it was as a result of Kim Wai Cheese and these two companies’ non-cooperation that really forced the Director General to do best judgment assessments.”
Brads’ Four-Million-Dollar Tax Challenge Fails in High Court
The dispute centered on “Best Judgment” assessments of roughly one point one nine million dollars against Brads Gaming Company Limited and approximately three point thirteen million dollars against Brads Gaming Group Limited. In the end, the court refused all relief, upheld the tax authority’s power to issue the assessments, and ordered the claimants to pay half of the government’s legal costs.
Magali Marin
Magali Marin, SC, Attorney-at-law
“ The effect of the judgment is that the best judgment assessments were lawful, and basically they have to pay. So, she has the ability to enforce and if there is evidence to say that the company does have assets, that in fact, um, you know, she will have to enforce against those assets. It is interesting the judge went to great pains to point out because we had challenged Kim Wai Chee from bringing the claim because the taxpayers were these two companies. And so we said the, there was no enforcement yet against Mr. Kim Wai Chee. But the judge went to great pains to say, “Look Mr. Kim Wai Chee was the face or the interface with the tax department and if anybody did not comply with the maintaining the financial records, well, the director general will have to look into that, you know. But basically the judge and, um, you know, made some very strong statements that she, she said, for example, Mr. Kim Wai Chee at paragraph 51 of the judgment says, “The fact that the businesses had closed and did no longer have a physical office does not allow a responsible officer to evade his duties under the Tax Administration and Procedure Act. To say otherwise would be absurd.”
After Brad’s Gaming Company Limited’s exclusive license expired in March 2020, tax authorities requested financial records in July 2020, but the company failed to produce them, leading to best judgment tax assessments for periods that had never been audited during its years of operation.
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