Docket: A-50-14
Citation: 2014 FCA 289
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CORAM:
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DAWSON J.A.
WEBB J.A.
NEAR J.A.
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BETWEEN:
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PATRICK A. GOUVEIA
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Appellant
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and
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HER MAJESTY THE QUEEN
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Respondent
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Heard at Toronto, Ontario, on December 9, 2014.
Judgment
delivered from the Bench at Toronto, Ontario, on December 9, 2014.
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REASONS FOR JUDGMENT OF THE COURT BY:
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DAWSON J.A.
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Docket: A-50-14
Citation:
2014 FCA 289
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CORAM:
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DAWSON J.A.
WEBB J.A.
NEAR J.A.
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BETWEEN:
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PATRICK A. GOUVEIA
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Appellant
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and
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HER MAJESTY THE QUEEN
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Respondent
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REASONS FOR JUDGMENT OF THE COURT
(Delivered from the Bench at Toronto, Ontario, on December 9, 2014).
DAWSON J.A.
[1]
This is an appeal from a decision of the Tax
Court of Canada. The issue before the Tax Court was whether the Minister of
National Revenue properly disallowed the appellant’s deduction of legal fees
from income in the 2004 through 2007 taxation years. The legal fees were
incurred in the defense of charges brought by the Ontario Securities Commission
and a class action civil lawsuit.
[2]
For reasons cited in 2013 TCC 414, a judge of
the Tax Court dismissed the appellant's appeal. The Judge found that the legal
fees were not incurred to gain or produce income from a business. The Judge
also found that the legal fees were incurred to protect the appellant's
reputation and his capacity to earn future income. As such, the legal fees were
capital in nature.
[3]
It follows that to succeed on this appeal the appellant
must establish that both findings were in error.
[4]
We are all of the view that this appeal must
fail. The appellant has not demonstrated any error of law nor has he
demonstrated any palpable and overriding error by the Judge in his finding that
the fees were expended on account of capital and therefore were not deductible
as a current expense because of the operation of paragraph 18(1)(b) of the
Income Tax Act, R.S.C. 1985, c. 1 (5th Supp.).
[5]
Therefore, the appeal will be dismissed with
costs.
"Eleanor R. Dawson"
FEDERAL
COURT OF APPEAL
NAMES
OF COUNSEL AND SOLICITORS OF RECORD
(APPEAL FROM A JUDGMENT OF THE
HONOURABLE MR. JUSTICE FAVREAU OF THE TAX COURT, DATED DECEMBER 20, 2014,
DOCKET NO. 2009-3370(IT)G.
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STYLE OF CAUSE:
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PATRICK A.
GOUVEIA v. HER MAJESTY THE QUEEN
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PLACE OF
HEARING:
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Toronto, Ontario
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DATE OF
HEARING:
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dECEMBER 9, 2014
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REASONS
FOR JUDGMENT OF THE COURT BY:
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DAWSON J.A.
WEBB J.A.
NEAR J.A.
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DELIVERED
FROM THE BENCH BY:
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DAWSON J.A.
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APPEARANCES:
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Vern Krishna
Isabella Mentina
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For The Appellant
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Brooke Sittler
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For The
Respondent
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SOLICITORS OF RECORD:
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Borden Ladner Gervais LLP
100 Queen Street, Suite 1100
Ottawa, Ontario
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For The Appellant
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William F. Pentney
Deputy Attorney General of Canada
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For The
Respondent
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