The taxpayer disposed of a property and reported a business loss in his 1975 tax return. In computing the loss, the taxpayer deducted from the proceeds of sale of a property amounts paid into court in connection with outstanding liens placed on the property at the time a building was constructed on it, even though the amount remained in court for some time after 1975. In agreeing with the Minister's position that the amount was not deductible in the 1975 year, Strayer J stated (at pp. 5283-4):
The jurisprudence seems amply clear that a reserve for the possible future payment of liens is contingent because it is impossible to know, until matters are finally settled, how much will actually be owing and therefore money held in reserve for such purposes is not deductible as an expense until the amounts actually owing are ascertained... . Therefore even though some or all of the amount of $35,850.19 might be regarded as a business expense, and potentially part of a business loss, in some taxation year, it could not properly be so regarded in 1975.