Urichuk v. The Queen, 93 DTC 5120, [1993] 1 CTC 226 (FCA)

Hugessen, J.A.:— We are all of the view that the learned trial judge committed no error when he looked at all the circumstances surrounding the making of the agreement between the appellant and his wife in order to determine that the payment of $45,000 and the three further payments of $50,000 each, spread over a little more than two years, were lump sum payments and not “allowance . . . for the maintenance" of the wife. We specifically reject the appellant's suggestion that paragraphs 56(1)(b) and 60(b) of the Income Tax Act, R.S.C. 1952, c. 148 (am. S.C. 1970-71-72, c. 63) (the "Act") are designed by Parliament to give an absolute right to separated or former spouses to contract into or out of taxation by their characterization of payments as “maintenance”. There is simply no warrant in the wording of those provisions to support such a drastic departure from the general scheme of the Income Tax Act. We also reject the appellant's attempt to invoke the parol evidence rule to object to evidence of the circumstances leading up to the making of the agreement; the Minister, not being a party to that agreement, is entitled to rely on any available evidence to support his characterization of the payments in a manner different from that employed by the former spouses in the agreement itself. In our view the trial judge correctly examined the agreement and all its surrounding circumstances and applied thereto the proper criteria. His conclusion, we say with respect, is quite simply above reproach.

The appeal will be dismissed with costs.

Appeal dismissed.