A West Vancouver man sentenced to jail and fined $645,000 for tax offences and forgery has had his appeal tossed out of court.
Michael Curt Helmut Scholz was convicted in 2020 of three Excise Tax Act violations for claiming GST and HST rebates he was not entitled to while building his $6-million mansion on the 1000 block of Groveland Road.
According to court rulings, Scholz was collecting the rebates on his home between Dec. 31, 2009, and April 1, 2013, but, under the law, property owners who are building a home to live in themselves are not entitled to the benefits – only those who are building with intent to sell are.
When Canada Revenue Agency staff became aware of the more than $644,000 in rebates and evaded remittances, Scholz provided them with backdated, false documents attempting to disguise his intent for the property, a B.C. Supreme Court judge ruled. One was a trust document, declaring him to be the beneficial owner, despite the property being in his wife’s name. The other was a lease document that would reduce the fair market value on which he would be required to pay GST/HST. Scholz was found guilty on two counts of uttering forged documents and, in February 2021, he was sentenced to 29 months in jail and fined.
In his appeal, Scholz argued the trial judge was wrong in determining the trust and lease documents constituted forgeries.
“Globally, Mr. Scholz relies upon an asserted ability of taxpayers to develop tax strategies that are not labelled unlawful even though it is open to CRA to reject them. He says the documents were never false but simply re‑documented the property ownership structure to take a tax advantage, and that the backdating of the documents reflected the true intention of the parties at a particular time,” appeals court Justice Mary Saunders wrote in a ruling handed down April 1.
Saunders rejected Scholz’s arguments.
“The two documents taken together would have Mr. and Mrs. Scholz holding two different intentions at the same time,” she noted. “This was, in effect, an attempt to rewrite the history of the property for the period relevant to Mr. Scholz’s tax obligations.”
The court of appeal also rejected Scholz’s argument that the trial judge was wrong to deem him not credible. Scholz may have once told his wife of plans to sell the property, but then never pursued any followup after, the court found.
“The judge engaged in a straight-forward and appropriate process of considering the entire body of evidence, as he was obliged to do, and drawing inferences consistent with it,” Saunders wrote.
The decision to dismiss the appeal was unanimous among the three judges on the panel.
