Rowe,
T.C.C.D.J.:-
appellant
appeals
from
a
reassessment
of
income
tax
for
the
1987
taxation
year.
The
Minister
of
National
Revenue
disallowed
the
sum
of
$33,039
claimed
by
the
appellant
as
expenses
incurred
in
the
repair
and
maintenance
of
a
property,
on
the
basis
that
the
expense
was
not
made
or
incurred
for
the
purpose
of
gaining
or
producing
income
within
the
meaning
of
paragraph
18(1)(a)
of
the
Income
Tax
Act,
R.S.C.
1952,
c.
148
(am.
S.C.
1970-71-72,
c.
63)
(the
"Act").
The
issue
is
whether
the
expenditure
is
one
on
account
of
income
or
capital.
The
appellant
resides
in
Victoria,
British
Columbia
where
she
operates
a
bed
and
breakfast.
She
had
lived
in
Portage
La
Prairie,
Manitoba
and
had
been
married
to
Richard
Earl
for
32
years
prior
to
divorcing
in
1977.
As
a
result
of
a
property
settlement,
she
received
cash
for
her
interests
in
a
variety
of
properties
and
businesses
that
had
been
operated
by
various
limited
companies.
One
of
these
companies—All
Western
Drive-In's
Ltd.—owned
a
commercial
property
in
Portage
La
Prairie
which
was
leased
out
to
several
tenants.
By
an
agreement
in
writing
dated
December
21,
1981
(Exhibit
A-1)
between
the
appellant
and
Richard
Earl,
her
former
husband,
on
behalf
of
the
corporation,
the
appellant
became
the
sole
operator
of
the
commercial
building
with
authority
to
manage,
repair
and
maintain
the
building
and
to
retain
all
of
the
income
derived
from
rentals.
Further,
the
appellant
was
to
use
her
best
efforts
to
sell
the
building
and
would
be
entitled
to
50
per
cent
of
the
net
proceeds
as
defined
in
the
agreement.
At
this
time,
Mr.
Earl
was
living
in
British
Columbia
while
the
appellant
was
in
Portage
La
Prairie
and
the
building
was
occupied
by
only
one
tenant.
Mrs.
Earl,
having
many
years'
experience
in
business
and
property
management,
embarked
on
a
course
of
upgrading
the
premises
and
finding
appropriate
tenants.
She
was
successful
in
this
endeavour
and
things
went
fairly
smoothly
until
1984
at
which
point
the
roof
began
to
leak,
causing
interior
damage
and
disrupting
the
business
of
the
tenants,
principally
a
travel
agency
and
a
pizza
restaurant.
The
appellant
located
a
firm
from
Winnipeg
to
carry
Out
the
repairs
at
a
cost
of
$4,200
and
she
reassured
her
tenants
the
problem
was
solved
and
cancelled
one
month's
rent
to
the
travel
agency
as
a
show
of
good
faith.
However,
another
episode
of
water
intrusion
occurred
and
the
appellant
was
able
to
have
the
contractor
attend
and
carry
out
another
repair
on
the
basis
of
warranty
flowing
from
the
original
repair.
The
building
had
been
constructed
in
the
1950s
and
had
a
flat
roof.
By
the
fall
of
1987,
the
roof
began
to
leak
and
the
appellant
hired
Bachalo
Enterprises
Ltd.,
a
local
contractor
to
resolve
the
problem.
Bachalo
had
been
contacted
by
the
appellant
in
1984,
but
that
firm
had
declined
to
undertake
the
repair
as
it
was
not
equipped
to
rectify
the
problem
owing
to
the
flat
roof
design.
As
a
result
a
firm
was
brought
in
from
Winnipeg.
However,
in
1987
Bachalo
reroofed
the
building
by
using
rafters
and
laying
plywood
and
roofing
material
on
top
thereby
creating
a
slight
pitch
to
prevent
the
water
from
lying
still
and
freezing
which
was
thought
to
have
been
the
cause
of
the
damage
over
many
years.
The
work
done,
as
outlined
in
the
invoice
(Exhibit
A-6)
cost
in
excess
of
$32,000.
On
October
10,
1987,
the
appellant
had
written
a
letter,
(Exhibit
A-5)
to
a
tenant,
advising
she
was
in
the
process
of
"doing
everything
as
quickly
as
possible
to
correct
the
problem,
i.e.,
negotiating
for
a
new
(completely
new
this
time)
roof”.
She
also
agreed
to
pay
the
sum
of
$100
to
compensate
the
tenant
for
business
loss
relating
to
the
leaking
roof
In
a
letter
dated
October
5,
1987,
(Exhibit
A-9)
to
her
tenant,
Totem
Travel,
the
appellant
stated:
You
have
been
very
understanding.
After
months
of
being
flooded,
I
know
any
other
tenant
would
simply
have
vacated
the
premises
by
now.
I
am
returning
this
month's
rent
cheque,
and
do
apologize
for
this
long
standing
inconvenience.
I
assure
you
I
have
been
working
to
correct
the
problem.
The
delay
has
been
brought
about
simply
because
I
have
tried
to
repair
the
existing
roof.
This
seems
impossible.
I
have
now
decided
to
contract
for
a
new
pitched
roof
by
a
local
firm.
The
appellant,
prior
to
expending
money
on
the
roof
in
1987,
had
listed
the
property
for
sale
at
$200,000.
After
the
reroofing
the
listing
price
was
not
increased.
One
offer
had
been
received
in
the
amount
of
$145,000,
but
the
appellant
felt
it
was
too
low
and
when
communicating
the
offer
to
her
former
husband
indicated
if
he
were
willing
to
sell
it
for
such
a
price
then
she
would
be
interested
in
buying
it
herself.
The
leaking
roof
problem
was
solved
and
the
tenants
remained
in
the
building
but
economic
conditions
in
Portage
La
Prairie
were
such
that
the
per
square
foot
rents
were
not
increased
in
order
to
retain
occupancy.
While
the
building
was
no
longer
the
subject
of
a
formal
listing
the
appellant
was
sufficiently
well
known
in
the
community
so
that
local
realtors
continued
to
understand
the
property
was
still
up
for
sale.
Prior
to
hiring
the
contractors
in
1987,
to
address
the
roof
problem,
the
appellant
had
considered
whether
or
not
the
expenditure
was
appropriate
and
decided
it
was,
especially
in
the
face
of
a
cost
of
$400,000
to
replace
the
building.
The
appellant
agreed
the
cost
was
substantial
in
relation
to
the
market
value
of
the
building
but
pointed
out
the
new
roof
did
not
add
anything
to
the
value
for
purposes
of
sale.
However,
failure
to
fix
the
problem
would
have
resulted
in
tenants
vacating
and
relocating
in
comparable
commercial
buildings
at
a
time
in
which
there
was
ample
space
available
in
Portage
La
Prairie.
The
building
currently
brings
in
revenue
of
$35,000
per
year.
Counsel
for
the
appellant
submitted
that
the
nature
of
the
work
undertaken
placed
it
in
the
category
of
semi-emergent
and
that
the
old
rules
of
distinguishing
between
capital
and
income
were
to
be
interpreted
in
light
of
modem
business
practice
and
existing
technology.
Counsel
for
the
respondent
argued
the
appellant
herself
considered
the
roof
to
be
a
new
roof
and
that
it
represented
a
substantial
portion
of
the
overall
value
of
the
building
and
was
clearly
of
enduring
benefit.
In
Shabro
Investments
Ltd,
v.
The
Queen,
[1979]
C.T.C.
125,
79
D.T.C.
5104,
the
Federal
Court
of
Appeal
considered
whether
an
amount
spent
by
the
appellant
in
replacing
a
substantial
part
of
the
floor
of
a
two-storey
building,
used
as
a
rental
property,
was
a
revenue
expenditure
or
one
on
account
of
capital.
Jackett,
C.J.
at
pages
129-30
(D.T.C.
5107)
stated:
In
so
far
as
the
outlay
of
$95,198.10
is
reasonably
attributable
to
the
removal
of
the
damaged
floor
and
its
replacement
by
a
floor
supported
by
the
steel
piles,
I
have
more
difficulty.
As
indicated
by
the
part
of
his
reasons
that
I
have
quoted,
the
learned
Trial
Judge
seems
to
have
taken
the
view
that
such
expenditure
cannot
be
regarded
as
a
"repair"
expenditure
because
(a)
the
work
was
not
done
because
of
"any
wear
of
the
facilities”
or
"any
aging
of
the
materials
previously
in
place”,
and
(b)
the
designing,
engineering
and
construction
of
the
new
floor
was
uite
different
from
that
of
the
previous
floor
but
was
to
meet
conditions
for
which
the
previous
floor
did
not
qualify.
In
my
view,
these
are
not
reasons
that
necessarily
disqualify
money
spent
on
remedying
damage
to
the
structure
of
a
building
from
being
treated
as
current
expense
on
repairs.
Damage
caused
by
accident
or
vandalism,
just
as
much
as
that
caused
by
deterioration
from
wear
and
tear
or
aging,
can
call
for
"repairs"
in
the
profit
and
loss
sense;
and
similarly
"repairs"
do
not
become
disqualified
as
"repairs"
in
that
sense
merely
because
they
are
carried
out
in
the
light
of
technology
unknown
when
the
original
structure
was
built
or
because
they
take
into
account
conditions
(such
as
dampness)
not
taken
into
account
when
the
original
structure
was
built.
I
am
of
the
view
that,
if
the
replacement
of
the
floor
could
otherwise
be
regarded
as
being
the
remedying
of
damage
to
the
fabric
of
the
building,
it
would
have
been
properly
deducted
as
a
current
expense
on
repairs
notwithstanding
(a)
that
the
damage
arose
from
a
hidden
defect
in
the
original
structure
and
not
from
wear
and
tear,
aging
of
materials
or
some
accidental
or
malicious
happening
in
the
course
of
use,
or
(b)
that
the
damage
was
remedied
in
accordance
with
technology
or
knowledge
as
of
the
time
thereof
that
incidentally
effected
an
improvement
in
the
structure
over
what
it
was
when
originally
built.
The
real
problem,
in
my
view,
with
regard
to
that
part
of
the
$95,198.10
that
can
reasonably
be
attributed
to
the
replacement
of
the
floor,
is
whether
the
replacement
of
the
floor
was
merely
the
remedying
of
damage
to
the
fabric
of
the
building
as
it
had
theretofore
existed
or
whether
it
was
an
integral
component
of
a
work
designed
to
improve
the
building
by
replacing
a
substantial
part
thereof
by
something
essentially
different
in
kind.
My
conclusion
is
that,
prior
to
the
change,
the
part
of
the
building
in
question
had
a
floor
(consisting
of
concrete
slabs
resting
on
garbage
fill)
which
made
the
lower
floor
of
that
part
of
the
building
unusable
and
that
to
remedy
that
situation
and
to
improve
the
building
by
making
the
space
in
question
usable
it
was
necessary
to
replace
that
floor
by
a
floor
consisting
of
a
concrete
slab
reinforced
by
steel
resting
on
steel
piles.
With
some
hesitation,
my
view
is
that
the
improvement
operation
was
the
whole
replacement
work
and
not
merely
the
sinking
of
the
steel
piles.
Again,
I
return
to
the
fact
that,
while
the
difference
between
repairs
and
capital
additions
or
improvements
is
obvious
in
certain
cases,
it
becomes
a
matter
of
difficulty
in
others.
Examples
of
cases
that,
I
suggest,
are
evident,
are
(a)
if
a
building
were
built
with
a
thatched
roof,
while
filling
in
holes
in
the
roof
would
be
repairs,
replacing
the
thatched
roof,,
by
reason
of
its
unsuitability
to
modern
living,
with
a
modem
roof,
metal
or
wooden,
would
be
a
capital
improvement
in
the
structure
of
the
building;
In
Gold
Bar
Developments
Ltd.
v.
The
Queen,
[1987]
1
C.T.C.
262,
87
D.T.C.
5152,
Jerome,
A.C.J.
of
the
Federal
Court—Trial
Division
dealt
with
the
situation
where
bricks
had
begun
falling
off
a
13-year
old
building
and
the
taxpayer
carried
out
necessary
remedial
work
by
using
metal
cladding
instead
of
replacing
the
original
brick
or
using
brick
veneer.
At
pages
264-65
(D.T.C.
5153-54
of
his
judgment
Jerome,
A.C.J.
stated:
I
do
not
think
the
solution
to
this
problem
can
be
found
in
the
effect
of
the
expenditure.
It
is
expected
that
repairs
to
a
capital
asset
should
improve
it.
Where
the
source
of
income
is
a
residential
apartment
building,
that
is
always
the
case,
especially
where
the
repairs
are
substantial.
Nor
do
I
find
the"once-in-a-lifetime"
approach
of
much
assistance.
The
more
substantial
the
repair,
the
less
likely
it
is
to
recur
(certainly
the
fervent
hope
of
the
building
owner)
but
it
remains
a
repair
expenditure
nonetheless.
I
think
it
is
more
helpful
to
emphasize
the
purpose
of
the
outlay
by
the
taxpayer.
What
was
in
the
mind
of
the
taxpayer
in
formulating
the
decision
to
spend
this
money
at
this
time?
Was
it
to
improve
the
capital
asset,
to
make
it
different,
to
make
it
better?
That
kind
of
decision
involves
a
very
important
elective
component—a
choice
or
option
which
is
not
present
in
the
genuine
repair
crisis.
It
is
not
in
dispute
that
the
plaintiff
discovered
in
1979
that
the
bricks
were
coming
loose
and
falling
on
the
ground
around
the
building
used
by
tenants
and
passersby.
Obviously,
it
was
a
risk
that
would
be
unacceptable
to
the
public,
but
also
one
likely
to
meet
a
reaction
from
city
officials,
in
the
extreme
even
closure
of
the
premises.
In
the
circumstances,
I
cannot
conclude
that
the
plaintiff
had
any
real
choice.
To
ignore
that
condition
would
certainly
have
brought
about
a
reduction
in
occupation,
or
in
rental
income.
It
is
also
common
ground
that
the
cause
of
the
premature
break-down
of
the
brick
veneer
was
faulty
work
by
the
original
subcontractor
when
the
plaintiff
had
arranged
to
have
the
building
constructed
some
ten
years
earlier.
That
is
not
directly
relevant
to
the
taxation
issue,
but
certainly
verifies
the
fact
that
the
plaintiff
had
this
decision
forced
upon
him
and
did
not
initiate
it.
This
was
not
a
voluntary
expenditure
with
a
view
to
bringing
into
existence
a
new
capital
asset
for
the
purpose
of
producing
income,
or
for
the
purpose
of
creating
an
improved
building
So
as
to
produce
greater
income.
The
plaintiff
was
faced
with
an
unexpected
deterioration
in
the
walls
of
the
building
which
put
the
viability
of
the
property
at
risk.
The
decision
to
spend
the
money
was
a
decision
to
repair
to
meet
that
crisis
and
despite
the
fact
that
I
am
sure
the
plaintiff's
expectation
was,
and
still
is,
that
it
will
not
recur
in
the
lifetime
of
the
building,
it
remains
fundamentally
a
repair
expenditure.
There
remain
two
other
considerations
that
arise
from
the
jurisprudence.
An
expenditure
which
is
in
the
nature
of
repair
will
not
be
allowed
as
a
deduction
from
income
if
it
becomes
so
substantial
as
to
constitute
a
replacement
of
the
asset.
See
Canada
Steamship
Lines
Ltd.
v.
M.N.R.,
[1966]
C.T.C.
255,
66
D.T.C.
5205;
M.N.R.
v.
Haddon
Hall
Realty
Inc.,
[1961]
C.T.C.
509,
62
D.T.C.
1001;
and
M.N.R
v.
Vancouver
Tugboat
Co.,
[1957]
C.T.C.
178,
57
D.T.C.
1126.
Here,
however,
while
the
sum
of
money
is
certainly
substantial,
the
undisputed
evidence
is
that
this
building's
value
at
the
material
time
was
in
the
range
of
$8,000,000
so
that
the
sum
in
issue
represents
less
than
3
per
cent
of
the
value
of
the
asset.
There
is
no
justification
therefore
to
reclassify
the
expenditure
on
that
basis.
Finally,
there
have
been
a
number
of
decisions
in
which
repairs,
either
alone
or
in
combination
with
other
work,
have
rendered
the
capital
asset
not
simply
restored
to
its
original
condition,
but
greatly
improved
because
of
its
new-found
resistance
to
those
factors
which
caused
the
deterioration.
See
Shabro
Investments
Ltd.
v.
The
Queen,
[1979]
C.T.C.
125,
79
D.T.C.
5104;
and
Healey
v.
M.N.R.,
[1984]
C.T.C.
2004,
84
D.T.C.
1017.
Counsel
for
the
defendant
invites
me
to
reach
that
conclusion
here
because
the
walls
to
the
plaintiff's
building
were
not
replaced
with
brick
as
before,
but
with
a
metal
cladding
that
went
beyond
answering
the
defects,
and
made
the
building
not
only
fully
resistant
to
the
problem
of
falling
bricks,
but
also
substantially
improved
in
appearance.
I
cannot
accept
the
suggestion,
however,
that
once
the
decision
to
repair
is
forced
upon
the
taxpayer,
he
must
ignore
advancements
in
building
techniques
and
technology
in
carrying
out
the
work.
In
remedying
the
situation,
the
plaintiff
was
given
two
or
three
options,
including
the
replacement
of
the
original
brick.
In
pursuing
the
option
of
curtain-wall
cladding,
the
plaintiff
adopted
an
extremely
popular
modem
construction
technique.
I
am
not
satisfied
that
the
appearance
of
the
building
was
any
better
than
it
would
have
been
had
the
original
brick
been
replaced.
Nothing
in
this
repair
project
attempted
to
change
the
structure
of
the
building.
What
was
done
was
neither
more
nor
less
than
was
required
to
replace
the
deteriorating
and
dangerous
brick
condition.
The
Minister
was
therefore
in
error
in
requiring
the
taxpayer
to
treat
this
as
an
expenditure
on
account
of
capital.
The
appeal
is
allowed
and
the
matter
will
be
returned
to
the
Minister
for
the
appropriate
reassessment.
Costs
to
the
plaintiff.
Counsel
for
the
appellant
provided
an
English
translation
of
the
decision
of
the
Québec
Court
of
Appeal
in
Le
Sous-Ministre
du
Revenu
du
Québec
c.
Denise
Goyer,
dated
April
15,
1987
(unreported).
Leave
to
appeal
to
the
Supreme
Court
of
Canada
was
refused
on
October
21,
1987.
In
Goyer,
the
property
in
question
was
a
duplex
evaluated
at
$100,000
by
the
municipal
authority.
The
plumbing
was
so
totally
inadequate
it
had
to
be
completely
replaced
as
did
the
wooden
flooring
to
balconies
which
had
rotted
through.
The
taxpayer
deducted
the
cost
of
the
work
as
a
current
expense.
The
judgment
of
the
Court
was
delivered
by
Vallerand,
J.,
who
after
considering
the
relevant
jurisprudence
on
the
subject
of
capital
versus
income
expenditures
stated
at
page
10:
Maintenance
and
repairs
are
effected
to
preserve
a
capital
asset.
As
a
rule,
it
is
of
little
importance
if
a
few
boards
on
a
balcony
and
a
few
lengths
of
pipe
are
replaced
each
year—the
expenses
incurred
would
unquestionably
be
considered
current
maintenance
expenses—or
that
having
neglected
to
maintain
the
property,
major
and
lasting
repairs
have
to
be
done.
As
long
as
a
new
capital
asset
is
not
created,
that
the
normal
value
of
the
capital
asset
is
not
increased
and
that
an
asset
that
had
ceased
to
exist
is
not
replaced
by
a
new
one,
the
repairs
and
maintenance
in
question
are
effected
to
restore
the
asset
to
its
normal
value.
In
this
case,
the
balconies,
plumbing,
windows
and
doors,
dilapidated
as
they
were
when
they
had
to
be
replaced—unlike
the
refrigerators
and
ranges
in
the
Haddon
Hall
decision
(15)
do
not
constitute
the
capital
asset,
but
only
some
of
its
component
parts,
so
much
so
that
to
replace
these
components
does
not
constitute
a
replacement
of
the
capital
asset
itself
but
only
its
repair.
Apparently
in
response
to
this
decision
Revenu
Québec
issued
a
document
128/4/R1—on
December
21,
1987
and
provided
the
following
example:
An
expense
to
replace
all
the
windows
of
a
building,
or
to
totally
repair
a
roof
or
a
plumbing
system,
will
be
considered
a
deductible
current
expense
if
it
merely
returns
the
building
to
its
normal
value.
However,
if
a
taxpayer
acquires
a
building
at
a
price
lower
than
normal,
and
if
(because
of
its
condition)
he
incurs
expenses
to
return
the
building
to
its
normal
value,
that
expense
is
capital.
On
the
other
hand,
installation
of
a
fireplace
in
this
building
will
be
capital,
because
there
would
then
be
an
addition
to
the
normal
value
of
the
building.
In
the
case
at
bar,
the
cost
of
the
roof
was
approximately
17
per
cent
of
the
value
of
the
building.
However,
the
value
at
the
time
was
depressed
as
a
result
of
a
stagnant
economy
in
Portage
La
Prairie
and
a
sluggish
real
estate
market.
The
nature
of
the
work
at
issue
must
be
examined
in
light
of
what
was
done
earlier
in
1984
to
rectify
the
problem
of
the
leaking
roof.
At
that
time
the
roof
was
cleaned
of
debris,
existing
drains
were
lowered
and
hot
asphalt
was
applied
to
the
entire
roof
with
other
waterproofing
methods
to
ensure
a
watertight
result.
The
work
was
expected
to
be
sufficient
for
a
few
years
and,
after
another
repair
under
the
warranty
agreement,
it
did
last
until
1987
when
the
problem
resurfaced.
This
time,
the
appellant
elected
to
have
installed
what
was
Clearly
a
new
roof.
The
installation
was
constructed
of
plywood
and
roofing
material
on
rafters
laid
on
top
of
the
old
roof
and
was
slightly
elevated.
The
appellant,
an
experienced
business
person,
regarded
the
work
as
constituting
a
new
roof
capable
of
solving
the
leakage
problem
for
the
foreseeable
future
thereby
providing
security
of
suitable
occupancy
to
the
tenants.
The
categorization,
by
the
appellant,
of
the
work
done
is
in
accord
with
the
evidence.
The
decision
not
to
replicate
the
efforts
of
1984
to
the
existing
flat
roof
was
undoubtedly
wise
and
based
on
sound
economic
principles.
However,
the
work
cannot
be
said
to
have
been
driven
by
emergent
circumstances,
even
from
a
purely
economic
standpoint,
as
another
attempt
to
repair
the
existing
roof
could
well
have
been
made.
Instead,
the
appellant
decided
that
enough
was
enough
and
the
old
flat
roof
would
not
withstand,
over
a
long
term,
the
conditions
created
by
Manitoba
winters
where
freezing
and
thawing
on
a
continual
basis
led
to
ongoing
damage
to
the
structure.
The
new
pitched
roof
created
an
improvement
to
the
building
of
an
enduring
nature
and
was
different
in
kind
from
the
old
flat
roof.
The
appearance
of
the
building
was
not
changed
and
the
new
roof
did
not
cause
any
increase
in
value
of
the
building
nor
aid
it
enable
the
appellant
to
earn
more
revenue
by
increasing
the
rent.
The
new
roof
did,
however,
comprise
a
substantially
different
integral
part
of
the
capital
asset.
The
new
roof
replaced
the
existing
one
just
as
surely
as
though
the
old
roof
had
been
totally
removed
and
hauled
to
a
landfill.
The
reasoning
of
Vallferand,
J.
in
Goyer
has
much
to
commend
it
and
is
highly
persuasive.
There
is
no
doubt
the
work
done
by
the
appellant
did
nothing
other
than
keep
the
property
in
its
normal
condition
so
that
the
usual
rental
income
could
be
maintained.
The
expenditure
on
the
roof
did
not
result
in
extra
income
from
the
same
tenants
nor
did
it
enable
additional
income
of
a
different
source
to
be
produced.
The
expenditure
did
not
increase
the
value
of
the
property
for
resale.
The
appellant
did
not
do
the
work
with
the
intent
of
increasing
any
value
on
resale
as
she
was
very
aware
of
the
poor
condition
of
the
local
real
estate
market.
On
the
other
hand,
the
water
problem
was
not
unexpected,
and
when
faced
with
the
difficulty
the
appellant
carefully
weighed
the
options
and
elected
to
proceed
with
a
new
roof
to
alleviate
the
problem.
She
did
not
proceed
on
the
basis
of
a
crisis
situation.
Basically,
the
jurisprudence
comes
down
on
the
side
of
treating
the
expenditure
by
the
appellant
as
one
on
account
of
capital.
In
principle,
there
is
no
real
difference
between
the
installation
of
a
new
roof
and
the
expenditures
in
Goyer,
when
the
purpose
was
to
maintain
the
asset
in
its
normal
revenueproducing
condition.
However,
with
the
exception
of
the
decision
in
Goyer,
the
line
of
authority
is
consistent
that
work
of
the
nature
undertaken
by
the
appellant
will,
barring
unusual
circumstances,
be
regarded
as
capital
in
nature.
The
Minister
was
correct
in
treating
the
expenditure
as
one
on
account
of
capital.
The
appeal
is
dismissed.
Appeal
dismissed.
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