Teitelbaum,
J.:—This
is
an
appeal
by
the
plaintiff,
Arthur
John
Androwich,
from
a
decision
of
the
Tax
Court
of
Canada
dated
September
10,
1987
dismissing
the
plaintiff's
appeal
from
the
reassessment
of
his
income
tax
for
the
1984
taxation
year.
In
his
1984
tax
return,
the
plaintiff
reported
the
following
income:
|
Net
Rental
Income
|
$
|
134.25
|
|
|
Interest
Income
(Term
Deposits
&
T-Bills)
|
$20,930.15
|
|
|
Total:
|
$21,064.40
|
(Exhibit
1,
Page
1)
|
The
plaintiff
contributed
$5,500
to
a
registered
retirement
savings
plan
(R.R.S.P.)
on
March
1,
1985
(receipt
#048513
Toronto
Dominion
Retirement
Savings
Plan)
and
thereby
reduced
his
net
income
to
$15,565.40.
His
taxable
income
was,
thus,
calculated
to
be
$10,559.
Federal
and
Saskatchewan
provincial
tax
amounted
to
$2,366.90
(Exhibit
1,
Page
7).
By
notice
of
assessment
dated
November
22,
1985
(Exhibit
2),
the
plaintiff
was
advised
that
his
claim
for
R.R.S.P.
savings
plan
premiums
had
been
adjusted
to
the
maximum
allowable
of
$26
resulting
in
a
revised
taxable
income
of
$16,033.
Total
federal
and
Saskatchewan
provincial
income
tax
was
assessed
at
$4,044.
The
plaintiff
was
also
advised
that
he
was
required
to
have
made
instalment
payments
of
$1,011
each
on
or
before
March
31,
June
30,
September
30
and
December
30,
1984
for
the
1984
taxation
year.
Since
the
plaintiff
failed
to
make
any
instalment
payments,
the
plaintiff
was
assessed
$333.05
in
instalment
interest.
The
plaintiff
was
also
assessed
a
penalty
in
the
sum
of
$404.40
for
late
filing.
The
plaintiff
states
he
makes
no
objection
to
the
penalty
claimed
by
the
defendant.
At
the
commencement
of
the
present
hearing,
the
defendant
filed
a
notice
of
motion
wherein
the
defendant
requests
the
Court's
permission
to
amend
its
statement
of
defence
by
deleting
paragraph
8
and
substituting
same
with
the
following
paragraphs:
8.
He
respectfully
submits
that
Subsection
15(1)
of
the
Canadian
Charter
of
Rights
and
Freedoms,
being
Part
I
of
the
Constitution
Act,
1982,
Schedule
B,
Canada
Act
1982,
c.
11
(V.E.)
(hereinafter
referred
to
as
the
"Charter")
is
inapplicable
in
the
circumstances
of
the
within
action
in
that
it
was
not
in
effect
when
the
events
which
brought
about
the
liability
for
income
tax
in
respect
of
the
Plaintiff's
1984
taxation
year
occurred.
9.
In
the
alternative,
he
respectfully
submits
that,
if
Subsection
15(1)
of
the
Charter
is
applicable
to
the
Plaintiff’s
1984
taxation
year,
which
is
not
admitted
but
denied,
then
paragraph
146(1)(c)
and
Subsection
146(5)
of
the
Income
Tax
Act
are
not
inconsistent
with
the
requirements
of
Subsection
15(1).
The
plaintiff
informed
me
that
he
makes
no
objection
to
the
said
motion.
I
am
satisfied
that
the
plaintiff
suffers
no
prejudice
by
the
motion
to
amend
in
that
he
was
served
with
a
copy
of
the
notice
of
motion
a
number
of
weeks
before
the
present
hearing.
I
allowed
the
motion
to
amend
without
costs.
The
plaintiff
then
informed
me
that
if
section
15
of
the
Canadian
Charter
of
Rights
and
Freedoms
(Charter)
should
have
no
application
in
the
present
case,
he
submits
section
7
of
the
Charter
in
place
of
section
15
in
that
the
relevant
sections
of
the
Income
Tax
Act
(I.T.A)
infringes
on
the
plaintiff's
life,
liberty
and
security.
No
formal
motion
to
amend
the
statement
of
claim
was
made
by
the
plaintiff.
As
the
plaintiff
is
representing
himself
and
has
no
legal
training,
I
am
going
to
assume
that
he
wishes
to
amend
his
statement
of
claim
by
adding
to
it
a
paragraph
that
would
state
that
the
relevant
sections
of
the
I.T.A.
infringe,
in
his
case,
section
7
of
the
Charter.
The
relevant
sections
of
the
I.T.A.
applicable
to
the
present
case
are:
1)
Registered
Retirement
Savings
Plans
|
(a)
amount
of
premium
deductible
|
section
146(5)
|
|
(b)
definition
of
"earned
income"
|
section
146(1)(c)
|
|
2)
Instalment
Payments
|
section
156(1)
and
section
156(3)
|
|
Instalment
Interest
|
section
161
|
The
plaintiff
submits
that
he
was
not
unemployed
for
the
1984
taxation
year
but
was
and
is
self-employed
since
he
was
not
receiving
unemployment
insurance
benefits.
He
states
that
he
pays
himself
from
the
revenue
of
term
deposits
and
treasury
bills.
I
cannot
accept
this
submission.
Non-receipt
of
unemployment
insurance
benefits
does
not
render
an
individual
not
unemployed.
In
addition,
whether
or
not
the
plaintiff
was
employed
is
not
relevant
to
the
issue
of
the
amount
of
his
contribution
to
an
R.R.S.P.
which
can
be
deducted
from
"income"
since
the
plaintiff
does
not
meet
the
requirements
of
subparagraphs
146(5)(a)(i)
or
(iii)
of
the
I.T.A.
146.
(5)
Amount
of
premium
deductible.—There
may
be
deducted
in
computing
the
income
for
a
taxation
year
of
a
taxpayer
who
is
an
annuitant
under
a
registered
retirement
savings
plan
or
becomes
an
annuitant
thereunder
within
60
days
after
the
end
of
the
year,
the
aggregate
of
all
amounts
each
of
which
is
the
amount
of
any
premium
paid
by
the
taxpayer
under
the
plan
during
the
year
or
within
60
days
after
the
end
of
the
year
(to
the
extent
that
it
was
neither
deducted
in
computing
his
income
for
a
previous
year
nor
designated
for
the
purposes
of
paragraph
60(j),
(j.1)
or
(1),
not
exceeding
the
amount,
if
any,
by
which
(a)
where
the
taxpayer
was
employed
in
the
year
and
(i)
as
a
consequence
thereof
was
a
person
who
is
or
may
become
entitled
to
benefits
under
a
pension
fund
or
plan
that
provides
for
payment
of
a
pension
to
him
payable
in
whole
or
in
part
out
of
contributions
made
or
to
be
made
to
the
fund
or
plan
or
out
of
or
in
respect
of
amounts
credited
or
to
be
credited
in
lieu
of
such
contributions
by
a
person
other
than
the
taxpayer
in
respect
of
the
taxpayer's
employment
in
the
year.
(ii)
(iii)
as
a
consequence
thereof
was
a
person
in
respect
of
whom
a
contribution
was
made
by
an
employer
to
a
deferred
profit
sharing
plan
in
the
year,
an
amount
that,
when
added
to
the
amount,
if
any,
deductible
under
paragraph
8(1)(m)
in
computing
the
income
of
the
taxpayer
for
the
year,
does
not
exceed
the
lesser
of
$3,500
and
20%
of
his
earned
income
for
the
year,
or
Therefore,
paragraph
146(5)(b)
of
the
I.T.A.
is
applicable.
The
plaintiff
can
deduct
the
lesser
of
$5,500
or
20
per
cent
of
his
"earned
income”.
146.
(5)
(b)
in
any
other
case,
the
lesser
of
$5,500
and
20%
of
his
earned
income
for
that
taxation
year
exceeds
the
amount,
if
any,
deductible
under
subsection
(6)
in
computing
his
income
for
that
taxation
year.
Plaintiff's
main
submission
is
that
his
interest
or
investment
income
should
be
regarded
as
"earned
income"
for
the
purpose
of
paragraph
146(5)(b)
of
the
I.T.A.
He
argues
that
the
ordinary
or
dictionary
meaning
of
the
words,
without
stating
what
is
the
meaning,
should
be
applied.
"Earned
income”
is,
however,
defined
in
paragraph
146(1)(c)
of
the
I.T.A.
146.
(1)
(c)
"earned
income"—"earned
income”
means
the
aggregate
of
(i)
salary
or
wages,
superannuation
or
pension
benefits,
retiring
allowances,
death
benefits,
royalties
in
respect
of
a
work
or
invention
of
which
the
taxpayer
was
the
author
or
inventor,
amounts
included
in
computing
the
income
of
the
taxpayer
by
virtue
of
paragraph
56(1)(b)
or
(c),
amounts
received
by
the
taxpayer
from
a
trustee
under
a
supplementary
unemployment
benefit
plan,
amounts
included
in
computing
the
income
of
the
taxpayer
by
virtue
of
this
section
and
amounts
included
in
computing
the
income
of
the
taxpayer
by
virtue
of
this
section
and
amounts
included
in
computing
the
income
of
the
taxpayer
by
virtue
of
subsections
146.2(6)
and
147(10)
and
(15),
(ii)
income
from
the
carrying
on
of
a
business
either
alone
or
as
a
partner
actively
engaged
in
the
business
(iii)
rental
income
from
real
property,
and
(iv)
amounts
deductible
under
paragraph
8(1)(l)
or
(m)
in
computing
the
income
of
the
taxpayer,
minus
(v)
losses
from
the
carrying
on
of
a
business
either
alone
or
as
a
partner
actively
engaged
in
the
business,
(vi)
losses
from
the
rental
of
real
property,
and
(vii)
amounts
deductible
under
paragraphs
60(j),
(j.l),
(I)
or
(m)
or
under
subsection
(6)
or
(7)
in
computing
the
income
of
the
taxpayer;
Interest
or
investment
income
does
not
fall
within
that
definition.
Rental
income
is
specifically
included
in
subparagraph
146(1)(c)(iii).
Thus,
the
defendant
is
correct
when
it
allowed
the
plaintiff
to
deduct
an
amount
equal
to
20
per
cent
of
his
rental
income
which
the
plaintiff
showed
to
be
$134.25
for
the
1984
taxation
year.
Where
a
term
is
defined
in
a
particular
statute,
as
"earned
income"
is
defined
in
the
I.T.A.,
that
definition
prevails
over
its
ordinary
or
dictionary
definition
(The
Interpretation
Act,
R.S.C.
1985,
c.
I-21,
s.
15(1)).
15.
(1)
Definitions
or
rules
of
interpretation
in
an
enactment
apply
to
all
the
provisions
of
the
enactment,
including
the
provisions
that
contain
those
definitions
or
rules
of
interpretation.
A
further
submission
made
by
the
plaintiff
is
that
subsection
146(5)
of
the
I.T.A.
contravenes
section
15
of
the
Charter
since
the
I.T.A.
discriminates
between
types
of
income
resulting
in
unequal
R.R.S.P.
deductions.
Furthermore,
the
plaintiff
submits
that
it
is
unconstitutional
or
discriminatory
not
to
use
the
dictionary
definition
of
the
word
"earned".
15.
(1)
Every
individual
is
equal
before
and
under
the
law
and
has
the
right
to
the
equal
protection
and
equal
benefit
of
the
law
without
discrimination
and,
in
particular,
without
discrimination
based
on
race,
national
or
ethnic
origin,
colour,
religion,
sex,
age
or
mental
or
physical
disability.
Unfortunately
for
the
plaintiff,
this
submission
cannot
be
considered
as
regards
the
plaintiff's
1984
taxation
year.
Section
15
was
not
proclaimed
in
force
until
April
17,
1985.
Section
15
of
the
Charter
does
not
have
retrospective
application
and
is
therefore
not
applicable
(Sa
Majesté
la
Reine
v.
Carole
Sylvestre,
F.C.A.,
A-88-85,
June
16,
1986).
Neither
can
section
7
of
the
Charter
have
application.
7.
Everyone
has
the
right
to
life,
liberty
and
security
of
the
person
and
the
right
not
to
be
deprived
thereof
except
in
accordance
with
the
principles
of
fundamental
justice.
Section
7
deals
with
the
life,
liberty
and
security
of
the
person
in
the
manner
in
which
the
individual
may
be
dealt
with
by
governmental
authority
and
by
the
way
the
individual
is
granted
procedural
fairness.
It
is
not
an
economic
guarantee.
In
the
case
of
Parkdale
Hotel
Ltd.
v.
Attorney
General
of
Canada
et
al.,
[1986]
2
F.C.
514
(T.D.),
the
Court
held
that
the
right
to
liberty
to
which
this
section
refers
is
a
restricted
legal
right
to
the
physical
liberty
of
the
person
as
opposed
to
an
economic
right
to
the
free
exercise
of
commercial
activity.
In
Re
Aluminum
Co.
of
Canada
Ltd.
v.
The
Queen
in
Right
of
Ontario
(1986),
29
D.L.R.
(4th)
583,
it
was
held
that
neither
the
right
to
liberty
nor
the
right
to
security
of
the
person
protected
by
this
section
includes
economic
rights.
The
Parliament
of
Canada
has
the
power
to
make
laws
with
regard
to
raising
funds
by
levying
an
income
tax.
It
has
the
power
to
define
terms
for
the
purpose
of
the
I.T.A.
By
defining
"earned
income"
as
it
did
in
the
I.T.A.,
Parliament
did
not
infringe
on
the
right
to
life,
liberty
and
security
of
an
individual
as
it
is
stated
in
section
7
of
the
Charter.
Plaintiff
submits
that
subsections
156(1)
and
161(2)
of
the
I.T.A.
dealing
with
instalment
payments
are
unconstitutional
under
section
24
of
the
Charter.
24.
(1)
Anyone
whose
rights
or
freedoms,
as
guaranteed
by
this
Charter,
have
been
infringed
or
denied
may
apply
to
a
court
of
competent
jurisdiction
to
obtain
such
remedy
as
the
court
considers
appropriate
and
just
in
the
circumstances.
The
plaintiff
gave
no
reason
for
this
allegation.
Subsection
24(1)
of
the
Charter
simply
provides
that
anyone
whose
rights
under
the
Charter
have
been
infringed
may
apply
to
a
Court
of
competent
jurisdiction
to
obtain
an
appropriate
remedy.
In
order
to
obtain
a
remedy
under
this
section,
the
plaintiff
must
first
establish
that
a
right
or
freedom
protected
under
the
Charter
has
been
infringed
(Regina
v.
James
et
al.:
Regina
v.
Dzagic
et
al.,
[1986]
2
C.T.C.
288;
86
D.T.C.
6432
(C.A)).
I
am
satisfied
that
there
has
been
no
infringement
of
any
of
the
rights
or
freedoms
of
the
plaintiff
as
he
is
required
to
make
instalment
payments
according
to
the
I.T.A.
If
he
fails
to
do
so
in
accordance
with
subsection
156(1),
he
is
then
required
to
pay
interest
for
late
payment
pursuant
to
section
161.
156.
(1)
Other
individuals—Subject
to
section
156.1,
every
individual,
other
than
one
to
whom
subsection
153(2)
or
section
155
applies,
shall
pay
to
the
Receiver
General
(a)
on
or
before
March
31,
June
30,
September
30
and
December
31,
respectively,
in
each
taxation
year,
an
amount
equal
to
1/4
of
(i)
the
amount
estimated
by
the
individual
to
be
the
tax
payable
under
this
Part
by
him
for
the
year
computed
without
reference
to
sections
127.2
and
127.3
or
(ii)
his
instalment
base
for
the
immediately
preceding
taxation
year,
and
(b)
on
or
before
April
30
in
the
next
year,
the
remainder
of
his
tax
as
estimated
under
section
151.
156.
(3)
"Instalment
base”
defined.
—In
this
section,"instalment
base”
of
an
individual
for
a
taxation
year
means
the
amount
determined
in
prescribed
manner
to
be
his
instalment
base
for
the
year.
161.
(1)
General.
—Where
at
any
time
after
the
day
on
or
before
which
a
return
of
a
taxpayer's
income
was
required
to
be
filed
under
this
Part
for
a
taxation
year
(a)
the
amount
of
his
tax
payable
for
the
year
under
this
Part
exceeds
(b)
the
aggregate
of
all
amounts
each
of
which
is
an
amount
paid
at
or
before
that
time
on
account
of
his
tax
payable
and
applied
as
at
that
time
by
the
Minister
against
the
taxpayer's
liability
for
an
amount
payable
under
this
Part
for
the
year,
the
person
liable
to
pay
the
tax
shall
pay
interest
on
such
excess,
for
the
period
after
April
19,
1983
during
which
it
is
outstanding,
at
such
prescribed
rates
per
annum
as
are
in
effect
from
time
to
time
during
the
period.
161.
(2)
Interest
on
instalments.
—In
addition
to
the
interest
payable
under
subsection
(1),
where
a
taxpayer,
being
required
by
this
Part
to
pay
a
part
or
instalment
of
tax,
has
failed
to
pay
all
or
any
part
thereof
as
required,
he
shall,
on
payment
of
the
amount
he
failed
to
pay,
pay
interest
at
the
rate
per
annum
prescribed
for
the
purposes
of
subsection
(1)
from
the
day
on
or
before
which
he
was
required
to
make
the
payment
to
the
day
of
payment
or
the
beginning
of
the
period
in
respect
of
which
he
becomes
liable
to
pay
interest
thereon
under
subsection
(1),
whichever
is
earlier.
The
requirement
that
the
plaintiff
make
instalment
payments
does
not
infringe
any
right
guaranteed
under
the
Charter.
The
plaintiff
also
relies
on
section
52
of
the
Charter:
52.(1)
The
Constitution
of
Canada
is
the
supreme
law
of
Canada,
and
any
law
that
is
inconsistent
with
the
provisions
of
the
Constitution
is,
to
the
extent
of
the
inconsistency,
of
no
force
or
effect.
This
section
simply
states
that
the
Constitution
of
Canada
is
the
supreme
law
of
Canada
and
any
law
that
is
inconsistent
with
its
provisions
is,
to
the
extent
of
the
inconsistency
of
no
force
and
effect.
I
am
satisfied
that
the
plaintiff
has
not
established
that
the
relevant
sections
of
the
I.T.A.
are
inconsistent
with
the
Constitution.
Conclusion
Sections
7
and
15
of
the
Charter
are
not
applicable.
The
plaintiff
has
failed
to
establish
that
any
other
provision
of
the
Charter
has
been
infringed
or
that
any
other
inconsistencies
exist
between
the
income
tax
provisions
and
the
Canadian
Constitution,
thus
section
24
and
section
52
of
the
Charter
are
not
applicable.
Deductions
of
contributions
to
an
R.R.S.P.
are
governed
by
subsection
146(5)
of
the
I.T.A.
The
plaintiff
does
not
meet
the
requirements
of
paragraph
146(5)(a).
Therefore,
his
entitlement
to
deduct
his
contributions
is
governed
by
paragraph
146(5)(b)
and
is
limited
to
the
lesser
of
$5,500
or
20
per
cent
of
his
"earned
income".
"Earned
income"
is
defined
in
paragraph
146(1)(c).
Interest
or
investment
income
does
not
fall
within
the
definition
of
"earned
income".
In
accordance
with
subsection
156(1)
of
the
I.T.A.,
the
plaintiff
was
required
to
make
quarterly
instalment
payments
of
income
tax.
Using
the
instalment
base
of
an
individual
as
calculated
under
Income
Tax
Regulation
5300
5301.
(1)
Corporations
under
Part
I
of
the
Act.
—Subject
to
subsections
(6)
and
(8),
for
the
purposes
of
subsections
157(4)
and
161(9)
of
the
Act,
“first
instalment
base"
of
a
corporation
for
a
particular
taxation
year
means
the
amount
equal
to
the
product
obtained
when
the
tax
payable
by
the
corporation
under
Part
I
of
the
Act,
computed
without
reference
to
sections
123.3
to
123.5
thereof,
for
its
taxation
year
immediately
preceding
the
particular
year,
is
multipled
by
the
ratio
that
365
is
of
the
number
of
days
in
that
preceding
year.
(2)
Subject
to
subsections
(6)
and
(8),
for
the
purposes
of
subsections
157(4)
and
161(9)
of
the
Act,
the
"second
instalment
base”
of
a
corporation
for
a
particular
taxation
year
means
the
amount
of
the
first
instalment
base
of
the
corporation
for
the
taxation
year
immediately
preceding
the
particular
year.
The
plaintiff
was
required
to
pay
instalments
of
$1,011
each.
Having
failed
to
make
any
instalment
payments,
the
plaintiff
is
subject
to
pay
instalment
interest
under
section
161
of
the
I.T.A.
The
rate
of
interest
is
specified
in
Income
Tax
Regulation
4300.
The
amounts
claimed
on
the
notice
of
assessment
for
the
revised
taxable
income
for
the
federal
and
provincial
income
tax
and
instalment
interest
are
correct.
Plaintiff's
action
is
dismissed
with
costs
in
favour
of
the
defendant.
Appeal
dismissed.
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