Thurlow,
C
J:—We
do
not
need
to
hear
you
Mr
Goodman
and
Miss
Swystun.
The
issue
in
this
appeal
is
whether
the
learned
trial
judge
erred
in
finding
that
the
fair
market
value,
on
December
31,
1971,
of
the
voting
trust
rights
of
the
respondent,
representing
3,345
shares
in
CTC
Dealer
Holdings
Limited,
was
$40.50
multiplied
by
3,345
as
contended
by
the
respondent,
or
$33.35
multiplied
by
3,345
as
urged
by
the
appellant.
The
rights
in
question
were
subject
to
the
terms
of
a
declaration
of
trust
which
restricted
ownership
to
a
group
of
some
259
Canadian
Tire
Corpora-
tion
dealers
and
established
a
formula
for
determining
the
price
at
which
sales
might
be
made.
The
formula
price
was
reached
by
an
averaging
over
a
period
of
a
year
of
stock
market
prices
for
Canadian
Tire
Corporation
shares.
Voting
shares
in
CTC
Dealer
Holdings
Limited
were
in
exact
proportion
to
the
number
of
shares
held
by
that
company
in
Canadian
Tire
Corporation,
a
number
which
began
in
1963
as
20,000
purchased
for
$1,020,699
and
became,
simply
through
stock
divisions,
300,000
shares
worth
$12,150,000
at
the
market
price
of
$40.50
per
share
at
December
31,
1971.
CTC
Dealer
Holdings
Limited
was
a
company
organized
for
the
purpose
of
acquiring
and
holding
the
particular
block
of
shares
in
the
interests
of
its
members.
The
learned
trial
judge
found
that
in
addition
to
the
formula
price,
the
respondent’s
rights
had
what
he
referred
to
as
“retention”
value
and
that
other
certificate
holders
would
be
prepared
to
pay
a
premium
in
excess
of
the
formula
price
to
acquire
the
respondent’s
shares.
This
would
have
been
prohibited
by
the
declaration
of
trust.
On
the
other
hand,
at
the
material
time,
the
respondent,
though
unable
to
charge
more
than
the
formula
price,
was
under
no
obligation
or
pressure
to
sell.
Counsel
for
the
appellant
submitted
that
there
was
error
in
failing
to
hold
that
the
formula
price
was
determinative
of
fair
market
value
and
in
failing
to
adopt
it
as
such.
In
our
opinion,
the
formula
price
was
the
minimum
price
which
the
respondent’s
shares
would
have
brought
and
it
was
obtainable
at
any
time.
We
do
not
think
it
represents
fair
market
value
within
the
meaning
of
the
Income
Tax
Act.
Counsel
also
submitted
that
the
trial
judge
had
erred
in
concluding
that
purchasers
would
have
been
prepared
to
pay
a
premium
over
the
formula
price
simply
because
there
was
an
element
of
retention
value
to
be
taken
into
consideration.
We
do
not
think
the
reasons
of
the
learned
trial
judge
should
be
so
interpreted.
In
our
view,
his
finding
that
a
premium
would
be
paid,
if
it
could
have
been
paid,
was
founded
on
the
evidence.
The
inferences
to
be
drawn
from
the
facts,
as
we
view
them,
are
that
while
there
may
have
been
persons
willing
to
buy,
at
the
material
time,
at
the
formula
price,
there
were
none
sold
at
that
price
and
that
a
prudent
owner
in
a
position
to
hold
on
to
his
shares
for
the
very
important
reasons
for
which
the
trust
was
created,
as
well
as
for
the
chance
of
appreciation
in
the
future,
would
not
have
been
willing
to
sell
at
the
formula
price
and
would
retain
his
shares
rather
than
do
so.
The
right
at
that
moment
to
retain
his
shares
is
also
a
property
right
of
such
an
owner
which
he
would
be
giving
up
in
a
hypothetical
sale
and
which,
in
our
opinion
is
properly
an
element
to
be
taken
into
account
in
determining
fair
market
value
in
a
situation
of
this
kind.
In
our
view,
its
existence
in
this
case
is
supported
by
the
evidence
and
the
finding
of
the
learned
Trial
Judge
both
as
to
its
existence
and
as
to
the
value
of
the
respondent’s
rights
on
December
31,
1971,
should
be
affirmed.
The
appeal
should
be
dismissed
with
costs.
Appeal
dismissed.
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