Otteson – Tax Court of Canada finds that references to a qualifying real estate property could refer only to the qualifying portion of the property

The taxpayers faced a problem in claiming the capital gains exemption on a sale of their property: only about half of the property was being used as a tree farm, so that it was borderline at best as to whether it was a qualified farm property.

Solomon proposed splitting a baby in two.  Similarly, Hogan J found that there was no requirement to regard the property as a whole ("otherwise land that has been legally subdivided would be preferred to land that has not been,") and concluded that the taxpayers could claim the exemption on a pro rata portion of the property.

Neal Armstrong.  Summary of Otteson v. The Queen, 2014 TCC 250 under s. 110.6(1) - qualified farm property and s. 96.