Cullen, J.:— This is an appeal from a reassessment of tax for the plaintiff's 1980 taxation year. In this reassessment the Minister of National Revenue, (Minister) disallowed amounts deducted on account of cargo claims and fines paid under the Customs Act and the Excise Tax Act.
The plaintiff is an Ontario corporation carrying on a business as a common carrier transporting goods and freight. On March 31, 1980, the plaintiff amalgamated with Overland Western Limited (Overland) and other corporations. In calculating its income for the 1980 tax year, Overland, one of the plaintiff’s predecessor corporations, deducted $175,385 on account of claims made against it in respect of damaged or lost goods cargo claims. According to the defendant, $125,385 of the above-noted amount represented filed cargo claims ($176,829 filed cargo claims less $51,444 claims against Overland for which other parties were considered liable) and the additional $50,000 represented an estimate for potential claims of customers for damaged or lost goods (estimated cargo claims). Overland also deducted $4,300 on account of fines paid under the Customs Act and the Excise Tax Act in respect of the 1980 taxation year.
The Minister reassessed the plaintiff, as the successor corporation to Overland, for the 1980 taxation year. The plaintiff filed a notice of objection. The Minister reconsidered the assessment but continued to disallow the amounts in respect of the cargo claims and fines. These amounts were added back to the plaintiff's income.
The plaintiff's position:
The plaintiff maintains that the cargo claims deducted by Overland represented the estimated cost of actual freight claims arising from freight ships prior to the 1980 taxation year. The amount covered both claims reported as of the year end and claims reported subsequent to the year end but referable to contracts executed and breached prior to the year. The plaintiff submits that the claims represented an expense made to earn income and were made in the year in respect of which the deduction was claimed, i.e. 1980.
The plaintiff also submits that the excise tax fines were incurred as a normal risk of doing business and deducted as part of the normal cost of earning profit.
The plaintiff further contends that the above-noted expenses were properly deductible as outlays incurred by the plaintiff (Overland) for the purpose of gaining or producing income from business or property.
The defendant's position:
The defendant submits that the filed cargo claims and the estimated cargo claims deducted by Overland in its 1980 taxation year consisted of liabilities which at the end of the year had not been incurred or were contingent and therefore prohibited from deduction pursuant to paragraphs 18(1)(a) and 18(1)(e) of the Income Tax Act.
The defendant also submits that the incurring of fines of $4,300 was not part of, or incidental to the carrying on of Overland's business as a carrier of goods and therefore may not be deducted in computing its income for the 1980 taxation year.
In reassessing the plaintiff, the Minister made the following assumptions and findings of fact:
(1) the estimated cargo claims ($50,000) represented an amount for potential claims for damaged or lost goods arising out of the 1980 taxation year but for which no claim had been made at the end of the 1980 taxation year; (2) Overland at no time accepted liability for any customer claim against it for damage to or loss of goods until it had investigated the claim to determine its (Overland’s) liability in respect of such claim;
(3) Overland at no time paid any amount in respect of any customer claim against it for damage to or loss of goods unless it accepted liability in respect of such claim;
(4) in respect of the filed cargo claims of $176,829, Overland neither had made investigation to ascertain its liability nor had accepted liability in respect of any amount thereof by the end of its 1980 taxation year;
(5) in respect of the estimated cargo claims of $50,000 sought to be deducted as described above, no customer claim for damage to or loss of goods had been made upon Overland, and no acceptance of such amount had been made by Overland, by the end of its 1980 taxation year.
1. (a) Whether the plaintiff is entitled to deduct $175,385 on account of cargo claims as an expense under paragraph 18(1)(a) of the Act, or
(b) Whether this amount, or any portion thereof, could be considered a contingent liability and therefore not deductible under paragraph 18(1)(e) of the Act.
2. Whether the plaintiff is entitled to deduct the fines paid under the Customs Act and the Excise Tax Act as an expense under paragraph 18(1)(a) of the Income Tax Act.
I — Cargo Claims:
(a) Deductibility under paragraph 18(1)(a) of the Income Tax Act:
The first matter to be determined is whether the cargo claims may be deducted as an expense under section 9 and paragraph 18(1)(a) of the Income Tax Act (the Act) set out below:
9. (1) Subject to this part, a taxpayer's income for a taxation year from a business or property is his profit therefrom for the year.
18. (1) in computing the income of a taxpayer from a business or property no deduction shall be made in respect of
(a) an outlay or expense except to the extent that it was made or incurred by the taxpayer for the purpose of gaining or producing income from the business or property;
It is well established that if an outlay or expense is made by the taxpayer in accordance with the principles of commercial trading or acceptable business practice and is made or incurred for the purpose of gaining or producing income from the business, then the outlay is deductible as an expense for income tax purposes (see Royal Trust Co. v. M.N.R.,  C.T.C. 32 at 42 and 44; 57 D.T.C. 1055 at 1060 and 1062). Further, the determination of whether the expenditure in question falls within the abovenoted provisions is a question of fact. The plaintiff adduced evidence at trial regarding the deductibility of cargo claims as an acceptable business practice as well as evidence indicating that the claims were incurred for the purpose of gaining or producing income.
The question of deductibility of cargo claims and insurance premiums was dealt with by Dubé, J. in Day & Ross Limited v. The Queen,  C.T.C. 707; 76 D.T.C. 6433. In the Day & Ross case the plaintiff company was engaged in the trucking business. Although the plaintiff carried insurance for various losses, liabilities and damages, it was still responsible for the first $5,000 deductible and therefore had to pay out certain sums arising out of cargo claims made against it. The plaintiff also paid fines for the violation of provincial weight restrictions. In calculating its income the plaintiff deducted the insurance premiums, the cargo claims, and the fines. The Minister disallowed the deduction of the insurance premiums and the cargo claims on the basis that they were reserves within the meaning of paragraph 12(1)(e) of the former Act (now paragraph 18(1)(e)). Dubé, J. had no difficulty finding that the insurance premiums and cargo claims were properly claimed as expenses as they constituted an outlay of commercial trading and were incurred for the purpose of producing income.
However, one must also consider that Noel, A.C.J. in Guay Ltée v. M.N.R.,  C.T.C. 686; 71 D.T.C. 5423; (appealed  C.T.C. 506; 73 D.T.C. 5373 (F.C.A.); appealed without reasons,  C.T.C. 97; 75 D.T.C. 5094 (S.C.C.)), at page 693 (D.T.C. 5427) termed the general rule:
... if an expenditure is made which is deductible from income, it must be deducted by computing the profits for the period in which it was made, and not some other period.
The issue in Guay related to a holdback by the plaintiff (a general contractor) from subcontractors in a construction contract. The holdback was for 35 days after the final approval of the work was given by the architect. The Court held that the amount of the holdback was a reserve or a contingent liability and prohibited by paragraph 12(1)(e) of the former Act. What is relevant at this point in the discussion is the comment made by Noel, A.C.J. at page 693 (D.T.C. 5427):
The procedure adopted by appellant, of deducting from its income amounts withheld by it, which it may one day be required to pay its sub-contractor, but which the latter may not claim until 35 days after the work is approved by the architect, is, as we have just seen, contrary to the rule that an expenditure may only be deducted from income for the period in which it was made, and this would suffice to dispose of the present appeal.
(b) Contingent liability:
Should I conclude that the $175,385 on account of cargo claims was properly deducted as an expense, I must still deal with the defendant's submission that the above-noted expenditure was contingent and therefore not deductible in the plaintiff's 1980 taxation year, per paragraph 18(1)(e) of the Act which reads:
18. (1) in computing the income of a taxpayer from a business or property no deduction shall be made in respect of
(e) an amount transferred or credited to a reserve, contingent account or sinking fund except as expressly permitted by this Part;
It is important to keep in mind the distinction between a reserve and an unpaid liability when trying to ascertain whether the filed cargo claims and/ or the estimated cargo claims are to be considered an expense (unpaid liability) or a reserve (contingent liability). Dubé, J. made the following observation in Day & Ross, supra, at page 714 (D.T.C. 6437):
The terms "reserve" and "contingent account" of paragraph 12(1)(e) connote the setting aside of an amount to meet a contingency, an unascertainable and indefinite event which may or may not occur; whereas the term "expense" in 12(1)(a) implies a liability present and certain, an amount definite and ascertainable.
The definition of contingent liability was also canvassed in Cummings v. The Queen,  C.T.C. 285; 81 D.T.C. 5207 (F.C.A.). Urie, J. at page 293 (D.T.C. 5213) noted the following quotation from Lord Guest in Winter v. Inland Revenue Commissioners,  A.C. 235, reproduced in Mandel v. The Queen,  C.T.C. 780; 78 D.T.C. 6518:
Contingent liabilities must, therefore, be something different from future liabilities which are binding on the company, but are not payable until a future date. I should define a contingency as an event which may or may not occur and a contingent liability as a liability which depends for its existence upon an event which may or may not happen.
The terms “contingent liability” and “contingent account" were also considered by Mahoney, J. in Harlequin Enterprises Limited v. The Queen,  C.T.C. 838 at 848; 74 D.T.C. 6634 at 6641:
The adjective “contingent” means “liable to happen or not; of uncertain occurrence or incidence” (The Oxford English Dictionary). The term “contingent account" taken literally would appear to be nonsense. An account, once set up is itself not contingent; it has, so to speak, happened and is not uncertain. It exists. The term must be taken to mean “account for a contingency”. In other words, it is not the account that must be found to be contingent but rather the thing in respect of which it was set up: in this case the liability to pay or give credit for the refunds and rebates. I have been unable to find Canadian authority defining the term “contingent liability”; however, in Winter et al. v. I.R.C.,  A.C. 235, the House of Lords did so in the context of the Finance Act, 1910 (3 & 4 Geo. VI, c. 29).
Therefore, what must be determined here is whether "the thing”, i.e. the liability to pay for the claims made against the plaintiff in respect of damaged or lost goods was "contingent", in other words dependent upon an event which may or may not occur.
In Harlequin, supra, the taxpayer (plaintiff) was a publisher who marketed books in Canada and in the United States. According to the distribution agreement, the Canadian distributor would receive rebates and the American distributor would receive refunds on the return of unsold books. The taxpayer deducted amounts as credit reserves for refunds and rebates in respect of the unsold books. At the trial level, Mahoney, J. concluded the liability under the distributorship agreement was contingent. He stated at page 849 (D.T.C. 6642):
Certain as it was that the plaintiff would, in due course, be obliged to give rebates on royalties or on returns of books, the fact is the plaintiff's liability to do so, under the terms of the agreements which were, in practice, observed, did not arise until the plaintiff was presented with a demand for the credit. The plaintiff's obligation to the distributors in respect of credits for returns was a contingent liability. So was its obligation to rebate royalties to Simon & Shuster. An account set up to provide for those contingent liabilities whether by way of a provision for returns and allowances on its balance sheet or a deduction from earnings in the calculation of its taxable income was a contingent account within the meaning of paragraph 12(1)(e).
Mahoney, J. continued at page 850 (D.T.C. 6643):
In this instance, it is neither the fact [that] an estimate had necessarily to be made nor that it might or might not have been called upon to meet the liability that defeats the plaintiff. Rather, it is the fact that the liability, as at the pertinent date, was contingent and the account set up to provide for it, whatever the mechanics, was a contingent account.
On appeal,  C.T.C. 208; 77 D.T.C 5164) Urie, J. approved Mahoney, J.'s reasoning and stated at pages 212-13 (D.T.C. 5166):
I agree that the provision for returns is contingent, because in any fiscal period, although it was known from experience that there would be returns, the number and actual value thereof could not be fully known until all returns on sales made within that fiscal period had actually been received which might not be until some considerable period of time had elapsed after the end of the fiscal period. Therefore, the provision falls within the prohibition contained in section 12(1)(e).
So, the determination of whether the filed cargo claims and the estimated cargo claims are contingent liabilities is a question of fact, dependent on the circumstances of the case before me.
The case law indicates that if the number and actual value of the claims are known they should be deducted as expenses. In Day & Ross, supra, the amounts relating to cargo claims were entered as expenses, were definitely owing and payable and in fact were paid. Dubé, J., in coming to his conclusion, took into consideration the following factors:
The amounts booked as accident and cargo claims were so entered for that year because the specific events leading to the claims had occurred in that year. The accountants did not set aside approximate amounts as "reserve" against contingencies, these amounts were booked as definitely payable because the premiums had been earned, the accidents had occurred, the claims had been filed, the investigations had taken place, the quantum of damage assessed, and the amounts entered.
Therefore, if in the case before me the same type of procedures were done, then I see no reason why the amounts entered could not be considered properly deducted. Further, if the facts were similar, the case before me could also be distinguished from Guay on the same basis as Dubé, J. did in Day & Ross, at page 715 (D.T.C. 6438):
Obviously the holdbacks in the Guay case were “conditional, contingent or uncertain" and "should not be used in calculating taxable profits’; their very purpose was to ensure the payment of any damage which might be incurred because of faulty performance. Thus the amounts withheld were not only uncertain as to quantum if partial damages resulted, but would no longer be even due and payable if damages exceeded the amounts withheld. Such is not the situation in the case at bar where the amounts entered as expense were definitely owing and payable and were in fact paid.
If, on the other hand, the value and number of any part of the filed cargo claims and/or estimated cargo claims could not be fully ascertained until some event in the future had occurred, such as the investigation of the claim, then the amount is a contingent liability.
In summary, the essential question is: was the actual amount (or any portion thereof) of the plaintiff's liability uncertain and unascertainable at the end of the 1980 taxation year? If so, then the amount must be considered a contingent liability and therefore not deductible under paragraph 18(1)(e) of the Act.
(c) Accounting principles:
Another factor I have considered is the manner of recording on the books or balance sheets the amounts relating to the cargo claims. If the provision for recording of cargo claims conforms with the requirements of generally accepted accounting principles (GAAP), then the application of those principles in the determination of the plaintiff's profit is to be allowed “unless the Act contains an express prohibition" (per Mahoney, J. in Harlequin, supra, page 847 (D.T.C. 6641) (emphasis added). The relevant prohibition is contained in paragraph 18(1)(e) of the Act. We heard an expert's evidence outlining the accepted accounting practice to be observed in setting out the cargo claims in question.
However, the case law is clear on the point that the fact of acceptability in accounting does not in itself make the expenditure in question a proper deduction for tax purposes. In Harlequin, supra, at page 849 (D.T.C. 6642), Mahoney, J. found that the account set up to provide for the contingent liabilities was a contingent account and that "no deduction in respect of that account, even to the extent that generally accepted accounting principles required it to be made, is permitted in the calculation of the plaintiff's taxable income".
In Cummings, supra, the Federal Court of Appeal disallowed a lease pickup in the amount of $500,000 as a contingent liability prohibited by paragraph 12(1)(e) of the former Act. The respondent's expert witness indicated that on the facts it would have been in accordance with generally accepted accounting principles to show the $500,000 on the balance sheet as a fixed liability instead of as a contingent liability. In response to this submission, Heald, J. stated at page 294 (D.T.C. 5214):
The answer to this submission is that the fact of the acceptability in accounting practice of dealing with a particular item in a particular manner, cannot by itself, make that practice a proper deduction for income tax purposes. Notwithstanding the evidence of accounting practice, the fact remains that, on the facts here present, the deduction is prohibited by paragraph 12(1)(e) of the Act. A similar situation was dealt with by Noel, A.C.J., in the J.L. Guay case discussed earlier herein. At page 245 of the report, the learned A.C.J. said:
In most cases only amounts which can be exactly determined are accepted. This means that, ordinarily, provisional amounts of estimates are rejected, and it is not recommended that data which are conditional, contingent or uncertain be used in calculating taxable profits. If indeed, provisional amounts or estimates are to be accepted, they must be certain. But then it is always difficult to find a procedure by which to arrive at a figure which is certain. Accountants are always inclined to set aside reserves for unliquidated liabilities, for, if they do not do so, the financial statement will not reflect the true position of the client's affairs. The difficulty arises from the fact that making it possible to determine the taxpayer's tax liability is not the main purpose of accounting. The accountant's report is, in fact, intended to give the taxpayer a general picture of his affairs so as to enable him to carry on his business with full knowledge of the facts. To achieve this end, it is not necessary for the profit shown to be exact, but it must be reasonably close, while the Income Tax Act requires it to be exact, and it is thus necessarily arbitrary.
I adopt that statement as applying with equal force to the situation in the case at bar.
The factual situation here is not the same as Day & Ross, supra, and it is clearly distinguishable. Earlier, in quoting Dubé, J., we know the procedure followed there by the taxpayer before amounts were entered on the books. In this case, however, the evidence of Mr. Barry Bruneau (Bruneau), director of administration for the plaintiff, is quite clear that when a claim was filed by the customer, the amount claimed was posted in the Master Claims Register but first subtracting the amount the taxpayer expected to recover from an interline carrier. No money was paid out until after an investigation by the taxpayer. The claim could be resolved in a number of ways, clearly making the sum posted contingent, i.e. payment was an event that might or might not happen. The claim could be resolved, for example, in the following ways after an investigation:
1. pay it in full ;
2. payment in full but total recovery or partial recovery from an interline carrier;
3. partial payment to customer because claim overstated or lost article found;
4. denied in its entirety:
— if claim not filed on time,
— claim without documentation,
— clear signature.
Therefore, the amount claimed as expenses was very clearly contingent, and therefore not deductible under paragraph 18(1)(e) of the Act.
If anything, the case against allowing an exemption in these circumstances is even stronger because it is an estimate of what the customers might claim, and that claim has not yet been made and of course not filed. In the words of the defendant, "no customer claim for damage to or loss of goods had been made upon Overland, and no acceptance of liability in respect of such amount had been made by Overland, by the end of its 1980 taxation year".
II — Deductibility of the Fines Paid Under the Customs Act and the Excise Tax Act:
The cases prior to Day & Ross, supra, tended to adhere to the view that fines imposed as a result of an infraction of the law would not be regarded as a proper deduction. The basis for this view is found in CIR v. Alex Von Glehn & Co. Ltd., 12 T.C. 232. In Day & Ross, Dubé, J. seemed to take a more liberal view of the deductibility of fines under paragraph 18(1)(a) of the Act. He concluded that the fines paid in respect of violations of provincial highway infractions, such as overloading, lost licence plates, missing mudflaps and misplaced registration documents, were deductible as an expense under paragraph 18(1)(a). Dubé, J. came to his conclusion on the basis of a "two- part" test (page 715; D.T.C. 6438):
The first determination must be as to whether or not the payment of the fines constituted an outlay made for the purpose of producing income for the plaintiff so as to meet the requirement of the exception to the prohibition of paragraph 12(1)(a). If the determination is affirmative, then the argument of public interest must be met.
The Court found that the fines paid by the taxpayer resulted from the day-to- day operation of its transport business and were paid as a necessary expense.
With respect to the second part of the "test", Dubé, J. concluded that the fines were not precluded from deductibility the basis of a "broader principle" known as public policy. The Court seemed to be influenced by the following factors, outlined at page 718 (D.T.C. 6440):
In the absence of constant control by the plaintiff over the exact cargo weight carried in its trailers, and the uncontradicted evidence would suggest that such a tight control would be impractical if not impossible in a very highly competitive road transport industry, then unintentional violations of weight restrictions would seem to be inevitable. Plaintiff’s method of bookkeeping, with fines paid entered as expense and fines recovered from customers booked as revenue, would also indicate that the payment of fines was very much a current item in the operation of plaintiffs business. The ready availability of advance overweight permits at the request of a shipper would also tend to show that weight restrictions can be easily overcome and that violations thereof are obviously not outrageous transgressions of public policy.
I do not think that these factors should be applied exclusively or strictly to any fact situation in that they were outlined in relation to the particular set of facts in the Day & Ross case and may not have been intended as a guide, setting parameters for the determination of the suitability of the deduction.
There are other relevant factors which must be considered in respect of the case before me.
The Tax Review Board in Canadian Motor Sales Corporation Limited v. M.N.R.,  C.T.C. 2037; 77 D.T.C. 30, denied the taxpayer a deduction in respect of a $150,000 penalty imposed under the Customs Act. Dubrulé, Q.C., in coming to his finding, determined that the penalty was not incurred for the purpose of earning income. In effect, the judgment rests on the fact that the taxpayer had failed to meet the onus of paragraph 12(1)(a) of the Act thereby failing Dubé, J.'s first test, although the Day & Ross case was not cited. Also, counsel for the taxpayer had argued that the $150,000 was not a penalty but if it were, he conceded it would not be deductible. The Board, having decided it was a penalty really met no opposition to the fact it could not be deducted. Thus, in the opinion of the Board, the taxpayer had failed both tests in endeavouring to establish deductibility.
The uncontradicted facts here are that 80,000 dispatches took place in the 1980 taxation year. Two types of penalty, in the total amount of $4,300, were imposed upon the plaintiff, namely:
1. having repair work done in the United States and the purchase of parts there, without paying the necessary sales and excise tax; and
2. foreign carrier used in Canada and made more than one stop which conduct is prohibited by law.
Counsel for the defendant conceded that the penalty imposed under 1. above, pursuant to the reasoning of Dubé, J. in Day & Ross, supra, was deductible. Repairs had to be made, were unavoidable and part of the plaintiff's expense of doing business under paragraph 18(1)(a) of the Act.
However, counsel for the defendant was adamant that the penalty imposed under 2. above was avoidable. The taxpayer, he argued, had established a pattern of flaunting the law, and really acted in a cavalier fashion in its treatment of or lack of respect for the law, and was really taking the risks in the hope that it would not be caught by an audit. Counsel also made this comment: "it may have been good economics and more expeditious but it was against public policy” (emphasis added). That comment buttresses my own view that these actions were taken to earn income and therefore were a legitimate expense under paragraph 18(1)(a) of the Act. The taxpayer has certainly met the "purpose test" vis-a-vis this penalty.
Next, I am satisfied there is no adequate authority for a blanket policy denial of deductions for all fines and penalties. The Canadian Motor Sales, supra, case was decided on the basis that the taxpayer had not met the "purpose test”, and in any event, counsel there conceded a penalty was not deductible. (He was wrong in my view.).
I cannot go as far as Mr. Vern Krishna does in his article, "Public Policy Limitations on the Deductibility of Fines and Penalties: Judicial Inertia", [Vol. 16, No. 11978] Osgoode Hall Law Journal, where he suggests at page 20 that the "purpose test", having been decided in favour of the taxpayer, ”. . . should have been sufficient to decide the question of deductibility of penalties paid by the taxpayer". His article, obviously carefully researched, declares at page 27:
Further, the premises of public policy doctrine as applied in Canadian tax cases dealing with the deductibility of fines and penalties remain undefined and unanalysed. In this undefined state the doctrine may be used as an instrument of moral stricture a deterrent mechanism, without regard to its impact on the policy of taxing statutes and the purpose which tax policy seeks to serve.
It seems to me that the courts must heed "public policy” and to make the necessary determination of that issue on the basis of its own best judgment. I do not believe that finding compliance with paragraph 18(1)(a) of the Act alone can ever be sufficient to allow a deduction. Different circumstances in each case will often lead to different decisions on the matter of "public policy”. I can, for example, visualize a situation where the "offences" were so numerous that the taxpayer really was flaunting a law of the legislature to such a degree that public policy would demand no deduction be allowed, even though the conduct was effective in increasing income. It may very well distort the Income Tax Act's tax on net income (because it meets the purpose test) but the Courts must concern themselves with that which they believe is in the public interest.
Different results will flow in judgments made where revenue is secured from “an illegal business or activity, illegal expenses occurred in pursuit of legal business and expenses incurred in pursuit of an illegal business": Krishna, supra, page 28. I have to concede that this approach does not lend any certainty to the law but we have seen a more liberal approach to the subject in Day & Ross and more likely will follow.
On the facts here, there is no question that the amount of the fines cannot be divided between the two offences; the $4,300 is a bulk sum and one agreed to by the Minister after negotiation. Counsel has said it may be good economics and more expeditious and, as stated earlier, the requirements of paragraph 18(1)(a) of the Act have been met. I cannot see that they should be disallowed on the basis of public policy, given the small number of offences in 80,000 dispatches.
However, counsel for the plaintiff has made the point and made it very well, that the fines were imposed in 1979 and paid in 1981 and therefore cannot be brought in as income for the 1980 taxation year; nor of course can they be allowed as expenses in the 1980 taxation year.
There were matters purely of arithmetic raised by the defendant, e.g. the $41,000 arithmetic error, and other matters signicantly reducing the numbers, be they for expenses or inclusion in income. This matter is referred to the Minister of National Revenue, on the basis that the expenses claimed on filed and unfiled claims be disallowed, and that the penalty of $4,300 is an expense but certainly not in the 1980 taxation year. The matter of amounts and arithmetic can be resolved by the taxpayer and the Minister of National Revenue, but failing that, a reference may be taken to this Court. My reading is that the taxpayer figures are probably correct but need more refinement than I am able to give them at this time. Costs shall be to the defendant.