Gladden Estate v. The Queen, 85 DTC 5188, [1985] 1 CTC 163 (FCTD)

"Contrary to an ordinary taxing statute a tax treaty or convention must be given a liberal interpretation with a view to implementing the true intentions of the parties". The phrase "sale or exchange" was given a liberal construction so as to include a deemed disposition.

The "sale or exchange" of capital assets under Article VIII of the 1942 Canada-U.S. Convention included a deemed disposition of capital property under s. 70(5)(a) of the Act. "[T]o hold that a deemed disposition would, as claimed by the Minister, be taxable as a capital gain while a true sale or exchange would not, would be both unreasonable and absurd".