Date:
20020722
Docket:
1999-5028-IT-G
BETWEEN:
ALAIN
FECTEAU,
Appellant,
and
HER MAJESTY
THE QUEEN,
Respondent.
Reasons
for Judgment
Lamarre
Proulx, J.T.C.C.
[1]
These appeals are for the 1995 to 1997
taxation years.
[2]
With respect to the principal argument, the points at issue are:
(1) whether, in 1991, the appellant converted personal-use
property, that is, his principal residence, to inventory; and
(2) whether the appellant may deduct the rental losses for
the three years, 1995 to 1997, as expenses relating to an
adventure in the nature of trade. As to the alternative argument,
the question is whether the appellant carried on a rental
business with or without a personal interest and whether he may
deduct the losses from that rental business.
[3]
At the start of the hearing, counsel for the appellant informed
the Court that he was withdrawing the first argument from the
Notice of Appeal concerning the reasonable expectation of rental
profit and replacing it with the alternative argument put forward
in the Notice of Appeal respecting the adventure in the nature of
trade. He added that, since the appellant was a joint owner with
his spouse, he was seeking only half the losses. He also informed
the Court that all the information stated in paragraph 20 of
the Notice of Appeal had been admitted by the respondent party,
which counsel for the respondent confirmed.
[4]
Paragraph 20 reads as follows:
[TRANSLATION]
PROJECT
INVOLVING A RISK OR AN ADVENTURE IN THE NATURE OF
TRADE
20.
In the alternative, to the extent the Court concludes that there
was no reasonable expectation of profit, it is the
appellant's view that a business loss of $125,441, computed
in the manner hereunder, must be deducted from his income for
1997, in view of the fact that the appellant was involved in a
project involving a risk or an adventure in the nature of
trade:
|
Proceeds of disposition of the real property, land
and building
Less disposition expenses
|
$317,000
(11,441)
|
|
|
Net
proceeds of disposition from the real property, land and
building
|
$305,559
|
$305,559
|
|
Less:
Cost of inventory property
Opening cost of inventory
(FMV of real property in 1991)
Net
rental loss - 1995
Net
rental loss - 1996
Net
rental loss 1997
|
$413,000
6,934
6,733
4,333
|
|
|
|
$431,000
|
$431,000
|
|
Business loss on disposition of real
property
|
|
($125,441)
|
[5]
According to the appellant, he converted his principal residence
to inventory in the year in which he ceased to occupy it and from
the time he tried to sell the house at a profit. Counsel for the
respondent does not admit that there was a conversion to an
adventure in the nature of trade because he relies on the
appellant's intention at the time he acquired his principal
residence. Otherwise, if there was a conversion, he admits the
different values in paragraph 20 above, including the fair
market value of the capital property in 1991.
[6]
Since the Supreme Court of Canada rendered its decision in
Stewart v. Canada, [2002] S.C.J. No. 46 (Q.L.) before I made a
decision in this case, I asked counsel for the appellant whether
he wanted to make representations on the matter. He retained the
adventure in the nature of trade as his first point and argued in
the alternative that the rental of the house constituted a rental
business without personal interest and that the appellant was
thus entitled to the rental expenses.
[7]
The appellant and France Vigneault, an
officer of the Minister of National Revenue (the
"Minister"), testified at the request of counsel for
the appellant.
[8]
The appellant explained that he was an
administrative employee with AT & T in Montréal in 1989.
That company offered him the position of vice-president for
marketing and managing director of the business in Toronto. He
and his wife sold their house in St-Lazare, near
Montréal. His wife visited some 60 houses and he
about 15, employing the services of three real estate
agents. They chose a property in Newmarket, an area in Toronto
not far from where the high technology industry was located. The
house was at 963 Creebridge Crescent.
[9]
According to the appellant, Toronto was
anticipating a wave of Asian immigrants following the hand-over
of Hong Kong to China in 1997, and real estate agents advised him
on the important features sought by those immigrants when buying
a house. The house he purchased had those characteristics. The
real estate agents had advised the appellant on the subject, as
described in subparagraph 19(d) of the Notice of Appeal:
[TRANSLATION]
. . .
(d)
Moreover, the appellant, who was advised at the time by
specialists on the subject, had ensured that the property
purchased had characteristics highly sought after in a residence
by the Asians, such as:
-
not situated on a street corner to avoid automobile headlights
shining directly into the residence (the "eyes of the
tiger" phenomenon);
-
not having number 4 in the street address (since the number
"4" has the same sound in Chinese as the word for
"death");
-
not having a stairway opposite the main entrance (Scarlett
O'Hara stairway - because the "good spirits" could
escape through the main entrance); and
-
big enough so that a separate dwelling could be built to house
relatives or a nanny.
[10]
The appellant and his spouse expected the
prices of houses to continue rising since Hong Kong would be
handed over to China in 1997. The real estate market was booming
at the time. The person who sold him the house had purchased it
six months earlier for $385,000 and resold it for
$450,000.
[11] In
August 1991, he and his family left
Toronto. He explained that AT & T had acquired another business
called NCR and that a number of positions, including his own, had
had to be abolished. Since neither he nor his family wanted to
move to the United States, they returned to Québec. They
rented at first, and then in June 1992, they purchased a property
at Lac Delage.
[12]
Exhibit A-2 is a listing for the
sale of the Toronto property made on October 31, 1991. The
asking price was $454,900. The expiry date was December 20,
1991. Exhibit A-3 is another listing dated
January 29, 1992, either for sale or for rent. The expiry
date was April 7, 1992. The asking price was $444,900, and
the asking rent was $3,200 a month. Exhibit A-4 is a
photocopy of a real estate advertising newspaper dated
May 27, 1992, containing a photograph of the Newmarket
property. This time the asking price was $414,900.
[13]
Exhibit A-10 is the report of the
Minister's officer. Question 9 reads as
follows:
[TRANSLATION]
(9)
Personal Benefit
(i)
What personal benefit can the taxpayer derive from his business
or property?
He initially
purchased the residence in order to live in it, and
subsequently to resell it at a considerable profit.
Question 4 reads
as follows:
[TRANSLATION]
(4)
Intentions and Action Plan:
(i)
Does the taxpayer have a specific action plan to make his rental
property or business profitable?
Decline in interest
rates, increase in frequency of mortgage payments and downward
reassessment of the building. Every year, Mr. Fecteau
reviewed the market value and rental value of the property by
consulting statistics on the transactions so as to have rental
comparables and to accurately determine the time to put the
property up for sale.
[14] The
taxpayer's accountant wrote as follows in the Notice of
Objection (Exhibit A-8):
[TRANSLATION]
. . .
To reduce
the carrying charges, Mr. Fecteau renegotiated his mortgage,
lowering the interest rate from 11.75 percent to
7.50 percent, and had to pay a penalty of $33,629 in 1992.
Those penalty costs were never claimed as expenses for the
purpose of determining rental losses for the years concerned.
That mortgage renegotiation resulted in a reduction in interest
expense from $36,660 in 1992 to $24,161 in 1993.
. . .
. . .
. . . Mr. Fecteau finally managed to rent
the property to Mr. Aubry in August 1992 for $2,000 a month.
That amount was far lower than what he had expected.
Subsequently, Mr. Fecteau tried to increase the rent each
year until August 1994, when he managed to raise it to $2,200 a
month. It should be noted that the tenant took admirable care of
the house and kept Mr. Fecteau informed of the necessary
repairs and maintenance (e.g., repairs to the patio/porch damaged
by freezing, water leaking into the basement as a result of the
poorly configured gutters and French drain). Moreover, in
five years, he never had any difficulty cashing the rent
cheques.
[15]
In 1997, the tenant left the premises.
The insurance company informed the appellant that the policy
premiums would increase or that it would refuse to insure an
uninhabited house. The appellant then asked the company that held
the mortgage whether it wanted to acquire the property for the
balance of the mortgage, and this was done at a price of
$317,000.
Arguments
[16]
Counsel for the appellant referred to
newspaper articles, which had appeared in 1991, describing the
wealth of Hong Kong immigrants and stating that their
preferred cities were Toronto and Vancouver. He referred to an
article published in 1992, which stated that the Ontario economy
had been hit very hard by the recession and that the housing
markets had not yet recovered from the shock. The article also
mentioned that the influx of immigrants was one of the rare
factors that helped stimulate housing demand.
[17]
Counsel for the appellant argued that,
when the appellant left his Toronto home, he changed its use.
There was a deemed disposition of the property at its fair market
value of $413,000. That value was not disputed by counsel for the
respondent. From principal residence, the house became
inventory.
[18] Counsel
for the appellant referred to the decision of Judge McArthur
of this Court in Stremler v. Canada, [2000] T.C.J.
No. 13 (Q.L.), and to the decision of the Supreme Court of
Canada in Friesen v. Canada, [1995] 3 S.C.R.
103. He cited the following paragraphs in
Stremler:
2
The Appellants purchased the properties through Reemark
Properties Ltd. which was in the business of selling residential
condominiums. The Appellants' position is that their sole
purpose in acquiring the properties was for resale at a profit
and therefore, they were real estate traders. The Minister of
National Revenue denies this and states that the properties were
capital assets, the Appellants had no reasonable expectation of
profit, and they were estopped from characterizing the units as
inventory because they had reported them as capital assets in
their income tax returns and claimed rental losses from their
rental operations. There are other issues which I shall deal with
later.
. . .
6
Both Appellants testified that they purchased their units to sell
them. They were intent on cashing in on the real estate boom of
the late 1980s as they saw it, living in the Toronto
area. . . .
. . .
9
The question is how to characterize the properties on the day of
purchase by the taxpayers having regard to all the circumstances.
It is unique to each individual. Each case must be looked at
individually to determine if, on the date of purchase, the
taxpayer intended keeping the property for the long term to earn
rental income, taking into account probable tax deductions, or
did he intend to sell it within a reasonably short period of
time.
10
The determination of whether or not the Appellants acquired the
properties as adventures in the nature of trade is a question of
fact. I find as a fact that both Appellants had as their primary
motive in purchasing the properties, the intention to sell. They
did not purchase with the intention of earning income from the
rental business. They were opportunists, speculators in real
estate following the trend of buying in the rising market with
the intention of selling at a profit in a few years. In the
meantime, the rents would offset some of the costs of holding the
units and by taking advantage of the Reemark plan, there would be
very little cash expenditures from their pockets and no effort to
manage the units. Their acquisition was about 95% financed
through a first mortgage and promissory notes all arranged by
Reemark. Even vacancies were of limited concern because they
entered into a rental pooling arrangement wherein the impact was
shared by most owners.
. . .
13
The Appellants have satisfied the Court, upon reviewing all of
the evidence, that their primary intention was to sell as quickly
as possible and realize a profit. . . .
. . .
28
In following the reasoning of Justice Iacobucci in Canderel, I
find that the carrying costs associated with the properties
should be deducted in the years in which the costs were incurred.
In Canderel, the proper manner in which to calculate profit is to
follow that calculation which best depicts the reality of the
taxpayer's income losses. . . .
[19] From
the decision in Friesen, supra, he cited the
following paragraphs in particular:
. . .
(1) Is the
Appellant's Venture a Business?
13
The definition of "business" in s. 248(1) specifically
includes an adventure in the nature of trade:
"business", includes a profession, calling,
trade, manufacture or undertaking of any kind whatever and,
except for the purposes of paragraph 18(2)(c), an adventure or
concern in the nature of trade but does not include an office or
employment; [Emphasis added.]
An "adventure
in the nature of trade" is not defined in the Act but is a
term which has a meaning established by the common
law.
. . .
15
The concept of an adventure in the nature of trade is a judicial
creation designed to determine which purchase and sale
transactions are of a business nature and which are of a capital
nature. . . .
16
The first requirement for an adventure in the nature of trade is
that it involve a "scheme for profit-making". The
taxpayer must have a legitimate intention of gaining a profit
from the transaction. . . .
17
IT-218R, which replaced IT-218 in 1986, lists a number of factors
which have been used by the courts to determine whether a
transaction involving real estate is an adventure in the nature
of trade creating business income or a capital transaction
involving the sale of an investment. Particular attention is paid
to:
(i)
The taxpayer's intention with respect to the real estate at
the time of purchase and the feasibility of that intention and
the extent to which it was carried out. An intention to sell the
property for a profit will make it more likely to be
characterized as an adventure in the nature of trade.
(ii)
The nature of the business, profession, calling or trade of the
taxpayer and associates. The more closely a taxpayer's
business or occupation is related to real estate transactions,
the more likely it is that the income will be considered business
income rather than capital gain.
(iii)
The nature of the property and the use made of it by the
taxpayer.
(iv)
The extent to which borrowed money was used to finance the
transaction and the length of time that the real estate was held
by the taxpayer. Transactions involving borrowed money and rapid
resale are more likely to be adventures in the nature of
trade.
. . .
19
I agree with Iacobucci J. that the appellant meets the tests
which have been established in the common law for an adventure of
trade. The speculative venture in which the appellant was
involved was clearly an adventure of a business nature rather
than an investment of a capital
nature. . . .
. . .
31
The basic scheme of dividing property into one of two broad
classes under the Income Tax Act is further assisted by ss. 13(7)
and 45(1). These sections make specific provision for the
conversion of real estate from capital property to inventory and
vice versa in particular circumstances. As IT-218R explains,
these circumstances arise only when the taxpayer's intention
and use of the property change subsequent to the initial
purchase. Sections 13(7) and 45(1) provide for the transfer to be
made by means of a deemed disposition and reacquisition at fair
market value. The deemed reacquisition at the time when the
taxpayer's intention with respect to the property is
materially changed reflects the fact that the category of the
property is determined according to the taxpayer's intention
at the time of acquisition.
[20] Counsel
for the appellant referred to paragraph 10 of Interpretation
Bulletin IT-218R:
. . . However, where real estate is converted from
capital property to inventory as discussed in 12 and 13 below,
the results will be as follows:
(a)
for real estate that is personal-use property its conversion to
inventory will constitute a change in use for the purposes of
subsections 13(7) and 45(1) with the attendant deemed
disposition and acquisition as explained in 11 below;
and
. . .
[21] Counsel
for the respondent referred to a decision of this Court in
Isaaks v. Canada, [2001] T.C.J. No. 312 (Q.L.),
and to the following paragraph:
14
The courts have consistently emphasized that in determining
whether a transaction was intended as an adventure in the nature
of trade, regard must be had to the surrounding circumstances:
Happy Valley Farms Ltd. v. The Queen, 86 D.T.C. 6421 at 6424. The significance
of intention as one of the factors to be considered was
emphasized by the Supreme Court of Canada in Friesen v. Canada,
[1995] 3 S.C.R. 103. In that case Major J.
summarized certain important factors to be considered in
determining whether a transaction in real estate is an adventure
in the nature of trade. He listed the following at paragraph
17:
(i)
The taxpayer's intention with respect to the real estate at
the time of purchase and the feasibility of that intention and
the extent to which it was carried out. An intention to sell the
property for a profit will make it more likely to be
characterized as an adventure in the nature of trade.
(ii)
The nature of the business, profession, calling or trade of the
taxpayer and associates. The more closely a taxpayer's
business or occupation is related to real estate transactions,
the more likely it is that the income will be considered business
income rather than capital gain.
(iii)
The nature of the property and the use made of it by the
taxpayer.
(iv)
The extent to which borrowed money was used to finance the
transaction and the length of time that the real estate was held
by the taxpayer. Transactions involving borrowed money and rapid
resale are more likely to be adventures in the nature of
trade.
[22] Counsel
for the respondent argued that, based on the case law principles
used to determine whether a property has been acquired with an
intention to trade or on account of capital, the property did not
become inventory.
[23] Is the
recent decision of the Supreme Court of Canada in Stewart,
supra, favourable to the appellant? Counsel for the
respondent made the following written representations on that
point:
[TRANSLATION]
. . . With deference to the contrary view, the respondent's
position is that Mr. Fecteau did indeed have a personal
interest in the property located at 963 Creebridge Crescent,
if only because his family had made it its principal residence,
as is established by the evidence.
If the
Court were to conclude that there was indeed a personal element,
it would then be possible for it to consider how the appellant
carried out his rental activity in light of the tests established
by the Supreme Court of Canada in Moldowan: (1) the
profit and loss experience in past years; (2) the
taxpayer's training; (3) the taxpayer's intended
course of action; and (4) the capability of the venture as
capitalized to show a profit after charging capital cost
allowance.
Thus,
considering the appellant's lack of experience in this type
of activity, the constant annual losses, the absence of any real
action plan and the high fixed costs, the respondent claims that
the appellant was not carrying on a commercial rental activity in
the years in issue. The rental expenses incurred during those
years are therefore not deductible.
[24] The
representations in rebuttal of counsel for the appellant were as
follows:
[TRANSLATION]
. . .
With
respect to the alternative argument as to the existence of a
reasonable expectation of profit, the appellant would like to
point out that, contrary to what counsel for the respondent
states, there was no element of personal benefit at the time the
Toronto property was rented. In fact, when the property located
at 963 Creebridge Crescent in Toronto was rented, the
appellant and his family no longer lived there and had moved to
the Québec area a few months earlier. From the moment the
appellant put the property up for sale or rent, neither the
appellant nor his family lived there, given that the property was
always rented. From the principal residence it was when the
appellant and his family lived there, the Toronto property became
a rental property when the appellant moved to Québec and
when the property was offered for rent. It is therefore wrong to
claim that there were any elements of personal use and benefit in
the rental property following the move to
Québec.
With
respect to the application of the principle of reasonable
expectation of profit and the determination as to whether there
was a personal element, that test must be limited to situations
in which there are clearly elements of personal use or benefit.
Take, for example, the situation in which a taxpayer owns a condo
in Florida or in a well-known ski resort and, while renting the
said condo, occupies or uses the property a few weekends during
the year. Based on the various tests established by the Supreme
Court of Canada in Moldowan, the taxpayer would have to
prove his right to deduct expenses since there is a personal
element in that type of situation.
We submit
that, since there was no element of personal use in
Mr. Fecteau's case, those various tests do not have to
be applied, as the Supreme Court recently held in
Bryan J. Stewart and Walls et
al.
Conclusion
[25] The
strategy proposed by counsel for the appellant to convert the
principal residence to inventory is tempting at first glance.
However, the intention to trade that must exist in respect of
inventory is proven on the basis of certain characteristics. Upon
analysis, the circumstances of the purchase, the offering for
sale and the renting of the appellant's family residence do
not reflect an intention to trade. They are those of many
taxpayers who want to acquire and protect an investment. A
taxpayer may be concerned with the resale value of his principal
residence. Depending on the market circumstances, he may also
wait a few years before reselling the main residence he has
ceased to occupy. All this is normal and does not convert the
gain from the sale of his house to a business gain, particularly
in the appellant's case, in which his principal residences
were actually acquired and sold in order to house him following a
change in work location.
[26] There
was no evidence of previous trading transactions by the
appellant. Neither the appellant's previous conduct nor the
circumstances in which the property was purchased give any
indication of an intention to trade. The principal residence was
therefore not converted to inventory. In my view, to decide
otherwise would be to go against the principles developed in the
case law to distinguish between purchase and sale transactions of
a commercial nature and those which are of a capital nature, as
restated in Friesen, supra.
[27] What of
the appellant's rental activities? I refer to
paragraphs 50, 52 and 62 to 65 of Stewart:
50
It is clear that in order to apply s. 9, the taxpayer must first
determine whether he or she has a source of either business or
property income. As has been pointed out, a commercial activity
which falls short of being a business, may nevertheless be a
source of property income. As well, it is clear that some
taxpayer endeavours are neither businesses, nor sources of
property income, but are mere personal activities. As such, the
following two-stage approach with respect to the source question
can be employed:
(i)
Is the activity of the taxpayer undertaken in pursuit of profit,
or is it a personal endeavour?
(ii)
If it is not a personal endeavour, is the source of the income a
business or property?
The first stage of
the test assesses the general question of whether or not a source
of income exists; the second stage categorizes the source as
either business or property.
. . .
52
The purpose of this first stage of the test is simply to
distinguish between commercial and personal activities, and, as
discussed above, it has been pointed out that this may well have
been the original intention of Dickson J.'s reference to
"reasonable expectation of profit" in Moldowan. Viewed
in this light, the criteria listed by Dickson J. are an attempt
to provide an objective list of factors for determining whether
the activity in question is of a commercial or personal nature.
These factors are what Bowman J.T.C.C. has referred to as
"indicia of commerciality" or "badges of
trade": Nichol, supra, at p. 1218. Thus, where the nature of
a taxpayer's venture contains elements which suggest that it
could be considered a hobby or other personal pursuit, but the
venture is undertaken in a sufficiently commercial manner, the
venture will be considered a source of income for the purposes of
the Act.
. . .
62
In this case, the appellant was engaged in property rental
activities. He owned four rental condominium units from which he
earned rental income. The fact that there was no personal element
to these properties was never questioned. The units were all
rented to arm's length parties and there was no evidence that
the appellant intended to make use of any of the properties for
his personal benefit. In our view, a property rental activity
which lacks any element of personal use or benefit to the
taxpayer is clearly a commercial activity. For what purpose would
the taxpayer have spent his time and money in this activity if
not for profit? As a result, the appellant satisfies the test for
source of income. Although this is sufficient to dispose of the
appeal, in our view a few additional remarks are
warranted.
63
Even if the appellant had made use of one or more of the
properties for his personal benefit, the Minister would not be
entitled to conclude that no business existed without further
analysis. A taxpayer in such circumstances would have the
opportunity to establish that his or her predominant intention
was to make a profit from the activity and that the activity was
carried out in accordance with objective standards of
businesslike behaviour. Whether a reasonable expectation of
profit existed may be a factor that is taken into consideration
in that analysis.
64
The Minister and the courts below made much of the fact that the
appellant anticipated a capital gain from the eventual sale of
the properties. It was argued that it was this anticipated gain,
and not rental profits, which motivated the taxpayer. As well,
the Minister argued that an anticipated capital gain should not
be included in assessing whether the taxpayer had a reasonable
expectation of profit. As such, it was the Minister's
submission that the appellant should not have been allowed to
deduct his interest payments under s. 20(1)(c)(i) as amounts paid
in respect of borrowed money used to produce income from a
business or property. The application of the REOP test by the
Minister was motivated by the policy concern that Canadian
taxpayers should not have to subsidize mortgage payments made in
respect of properties where the primary motivation is a long-term
capital gain.
65
In response to this argument, it must be remembered that s.
20(1)(c)(i) is not a tax avoidance mechanism, and it has been
established that, in light of the specific anti-avoidance
provisions in the Act, courts should not be quick to embellish
provisions of the Act in response to tax avoidance concerns:
Ludco, supra, at para. 39; Neuman v. M.N.R., [1998] 1 S.C.R. 770, at para. 63. In
addition, in Walls v. Canada, 2002 S.C.C. 47 the companion to
this case, we point out at para. 22 that a tax motivation does
not affect the validity of transactions for tax purposes. As
such, the appellant's hope of realizing an eventual capital
gain, and expectation of deducting interest expenses do not
detract from the commercial nature of his rental operation or its
characterization as a source of income. Moreover, in Ludco,
supra, at para. 59, this Court specifically stated that s.
20(1)(c)(i) does not require the taxpayer to earn a net profit in
order for interest to be deductible:
The plain meaning
of s. 20(1)(c)(i) does not support an interpretation of
"income" as the equivalent of "profit" or
"net income". Nowhere in the language of the provision
is a quantitative test suggested. Nor is there any support in the
text of the Act for an interpretation of "income" that
involves a judicial assessment of sufficiency of income. Such an
approach would be too subjective and certainty is to be preferred
in the area of tax law. Therefore, absent a sham or window
dressing or similar vitiating circumstances, courts should not be
concerned with the sufficiency of the income expected or
received. [Emphasis added.]
[28] Like
counsel for the appellant, I believe that the appellant's
rental activities could not be considered as a hobby or other
personal activity. The appellant no longer had any personal
interest in the property from the moment he ceased to occupy it
without any intention of returning to live in it again. His
activity was carried on with a view to earning a profit and was
not a personal activity. What the appellant sought was to obtain
the best possible price for his house. According to the decision
in Stewart, supra, that does not vitiate the
business nature of his rental activity, which was carried on for
the purpose of realizing a profit in the most serious and
commercial manner possible, as proven by the comments of his
accountant reproduced in paragraph 14 of these
reasons.
[29] The
appeals are allowed for the amounts admitted by counsel at the
start of the hearing, with costs to the appellant.
Signed at
Ottawa, Canada, this 22nd day of July 2002.
J.T.C.C.
[OFFICIAL
ENGLISH TRANSLATION]
1999-5028(IT)G
BETWEEN:
ALAIN
FECTEAU,
Appellant,
and
HER MAJESTY
THE QUEEN,
Respondent.
Appeals
heard on January 30, 2002, at Québec, Quebec,
and
last written
submissions received at Ottawa, Ontario, on June 27,
2002
by the
Honourable Judge Louise Lamarre Proulx
Appearances
Counsel
for the
Appellant:
Daniel Bourgeois
Counsel
for the
Respondent:
Alain Gareau
JUDGMENT
The appeals from the assessments made under the Income Tax
Act for the 1995, 1996 and 1997 taxation years are allowed,
with costs to the Appellant, for the amounts admitted by counsel
at the start of the hearing, in accordance with the attached
Reasons for Judgment.
Signed at
Ottawa, Canada, this 22nd day of July 2002.
J.T.C.C.
[OFFICIAL
ENGLISH TRANSLATION]
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