At the hearing, the Crown failed to include evidence proving that the corporation's debt was unsatisfied when the wife was assessed. (This is an application of the basic rule that a person who is assessed for the liability of another can challenge the underlying liability.)
Here, the Crown sought to re-open the case, under General Procedure rule 138, to introduce the documents it needed to prove that the corporation could not pay the debt. The court refused.
The tests for allowing a party to introduce evidence after a hearing are these:
"First, would the evidence, if presented at trial, probably have changed the result? Second, could the evidence have been obtained before trial by the exercise of reasonable diligence?" (See 671122 Ontario Ltd. v. Sagaz Industries Canada Inc.,  2 SCR 983, 2001 SCC 59, para. 20.)
With the Crown unable to show that the corporation had failed to pay and could not pay when the wife was assessed, the husband's appeal was allowed. (Benaroch c. La Reine 2015 CCI 93 (Favreau).) The court relied on Walsh v. The Queen, 2009 TCC 557, where the Tax Court reasoned:
" The purpose of paragraph 227.1(2)(a) [the ITA rule comparable to the GST rule involved here] is to require the Minister to exhaust his remedies of recovery against the corporate taxpayer before permitting him the extraordinary remedy of assessing a third party, its director, for the company’s unremitted source deductions. While subsection 227(10) provides that the Minister “… may at any time assess any amount payable under … section 227.1”, that otherwise broad power to assess is contingent upon the fulfillment of the conditions set out in paragraph 227.1(2)(a). In this way, paragraph 227.1(2)(a) is analogous to subparagraph 152(4)(a)(i) which, briefly stated, limits the Minister’s power to assess beyond the normal reassessment period to circumstances where the taxpayer’s actions amount to misrepresentation. While subparagraph 152(4)(a)(i) is silent as to onus and manner of proof, the jurisprudence has established that the imposition of conditions on the Minister’s power to assess has the effect of shifting the onus, which otherwise lies with the taxpayer, to the Minister and that the Minister’s burden of proof under that provision is a heavy one.
 Similarly, the language of paragraph 227.1(2)(a) places the onus on the Minister but does not specify how he is to prove his compliance with its conditions. Thus, it is for the Court to decide whether the Minister has met his evidentiary burden. While I have some sympathy for counsel for the Respondent’s characterization of the omission of the Sheriff’s letter from the Respondent’s List of Documents as “an irregularity”, it seems to me that proof of the Minister’s fulfillment of the conditions in paragraph 227.1(2)(a) is so fundamental to his power to assess under subsection 227(10) that any doubt on that score must be resolved in favour of the taxpayer. Here, the Minister has produced no evidence to show that the execution of the Writ of Seizure and Sale was returned unsatisfied. Absent proof that the Minister has satisfied the requirements of paragraph 227.1(2)(a), no liability attaches under subsection 227.1(1) and the assessment upon which it was based cannot stand."
See Benaroch c. La Reine 2015 CCI 91 (Favreau)