[OFFICIAL ENGLISH TRANSLATION]
Date: 20011206
Docket: 2001-51(IT)I
BETWEEN:
MARJOLAINE DIONNE,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR JUDGMENT
Lamarre Proulx, J.T.C.C.
[1] This is an appeal under the
informal procedure concerning the calculation of the child tax
benefit for the 1999 base year. The point at issue was whether
the net income of the appellant's de facto spouse must be
considered in computing the adjusted income within the meaning of
that term in section 122.6 of the Income Tax Act (the
"Act").
[2] By notice of child tax benefit
dated July 20, 2000, the Minister of National Revenue (the
"Minister") determined that the amount of the tax
benefit to which the appellant was entitled for her daughter
Josia for the 1999 base year was $32.33.
[3] In determining that tax benefit,
the Minister relied on the facts described in paragraph 5 of
the Reply to the Notice of Appeal (the "Reply") as
follows:
[TRANSLATION]
(a) the appellant is
the mother of a daughter named Josia, whose date of birth is
March 1, 1984;
(b) the appellant
and Guy Morrissette have lived together at least since
September 1998;
(c) in her notice of
objection dated September 11, 2000, the appellant stated
that she had a de facto spouse at the end of December 1999;
(d) the net income
of the appellant's de facto spouse, Guy Morrissette,
totalled $62,328 for the 1999 taxation year;
(e) the net family
income for the 1999 taxation year totalled $72,871;
(f) after the
net family income was considered in computing the appellant's
child tax benefits for the 1999 base year, the Minister
determined that the tax benefit for the appellant's daughter
Josia was an annual sum of $32.33;
[4] The appellant testified. She
corrected her daughter's date of birth referred to in
subparagraph 5(a) of the Reply to March 30, 1984. She
admitted subparagraph 5(b). She also admitted
subparagraph 5(c), provided the sentence ended after
[TRANSLATION] "stated that she had a de facto spouse".
She had not used the words [TRANSLATION] "at the end of
December 1999" in her notice of objection. However, she
testified that Guy Morrissette and she were de facto spouses
during 1999 and are still so now.
[5] She denied subparagraph 5(d)
because she believed that Mr. Morrissette's income was
greater than the amount cited. She also denied
subparagraph 5(e) because she did not think the net family
income was $72,871. She denied subparagraph 5(f).
[6] The appellant explained that, in
1998, before Mr. Morrissette came to share her life, she had
been paying $490 in rent. She had been receiving $325 a month in
federal and provincial family allowances, a GST rebate of $125
per quarter and $200 in assistance from the Quebec Parental Wage
Assistance (PWA) Program for low-income families.
[7] When Mr. Morrissette came to
live with her, they shared the rent and food expenses. However,
she paid the cable and telephone bills. They have now moved and
are paying a higher rent of $745 a month, of which she pays $200.
However, she claims she still pays for half the food. She buys
her own clothing and pays her daughter's expenses. She thus
finds the family income calculation unfair because it does not
represent the economic reality of the household as it pertains to
her.
[8] In her notice of appeal and
testimony, she stated that her daughter is not her de facto
spouse's child and that her de facto spouse already has
obligations to his own children. Her de facto spouse has no
rights with respect to her daughter and her daughter is entirely
her responsibility. She needs the child tax benefit to meet her
daughter's primary needs, that is to feed, clothe and educate
her. Her daughter's needs have actually increased since she
is now attending Cegep.
[9] Louise Girard was the appeals
officer on September 26, 2000, when she communicated with
the appellant. She filed as Exhibit I-3 the written
version of an electronic document showing
Guy Morrissette's net income for 1999. That income was
$62,328. The appellant's notice of objection was filed as
Exhibit I-2.
Analysis
[10] The terms "cohabiting spouse"
and "adjusted income" are defined as follows in
section 122.6 of the Act:
"cohabiting spouse" ¾"cohabiting
spouse" of an individual at any time means the person who at
that time is the individual's spouse and who is not at that
time living separate and apart from the individual and, for the
purpose of this definition, a person shall not be considered to
be living separate and apart from an individual at any time
unless they were living separate and apart at that time, because
of a breakdown of their marriage, for a period of at least
90 days that includes that time.
"adjusted income" ¾"adjusted
income" of an individual for a taxation year means the total
of all amounts each of which would be the income for the year of
the individual or of the person who was the individual's
cohabiting spouse at the end of the year if no amount were
included in respect of a gain from a disposition of property to
which section 79 applies in computing that income.
[11] Subsection 252(4) of the
Act provides that words referring to a parent of a
taxpayer include the person of the opposite sex who cohabits with
the taxpayer in a conjugal relationship and has so cohabited
throughout a 12-month period:
(4) In this Act,
(a) words referring to a spouse at any time
of a taxpayer include the person of the opposite sex who cohabits
at that time with the taxpayer in a conjugal relationship and
(i) has so cohabited with the taxpayer throughout a
12-month period ending before that time, or
(ii) would be a parent of a child of whom the taxpayer
would be a parent, if this Act were read without reference to
paragraph 1(e) and
subparagraph (2)(a)(iii)
and, for the purposes of this paragraph, where at any time the
taxpayer and the person cohabit in a conjugal relationship, they
shall, at any particular time after that time, be deemed to be
cohabiting in a conjugal relationship unless they were not
cohabiting at the particular time for a period of at least
90 days that includes the particular time because of a
breakdown of their conjugal relationship;
. .
.
[12] The deemed overpayment, which in other
words is the calculation of the Canada Child Tax Benefit, is
provided for in subsection 122.61(1) of the Act,
which states that adjusted income is considered in calculating
the overpayment or the Canada Child Tax Benefit. Adjusted income,
according to the above definition, means the total of the
appellant's income and income of her de facto spouse.
[13] The appellant stated that the
calculation of family income as required by the Act does
not take into account the contemporary reality of conjugal
relationships. Couples are formed and reformed, and each spouse
has his or her own family background and, in many instances, his
or her own children and personal obligations. A number of
spouses, themselves included, wish to continue managing their own
patrimony independently. It is therefore not appropriate to add
the two incomes when contributions to family expenses are not
made in proportion to income.
[14] The appellant also argued that the
Civil Code of Québec sets out no obligation for a
de facto spouse to the other de facto spouse and, consequently,
even less to the other spouse's child.
[15] Counsel for the respondent referred to
Granger v. Canada Employment and Immigration
Commission, [1986] 3 F.C. 70, a decision by the Federal
Court of Appeal, and to this Court's decision in
Feigenbaum v. Canada, [1999] T.C.J. No. 945
(Q.L.). It was held in those decisions that a court cannot amend
the Act but must render judgment in accordance with the
provisions of that Act.
Conclusion
[16] In the circumstances of this appeal and
on the evidence adduced, I find that the calculation of the
adjusted income does not represent the economic reality of the
family income at the disposal of the appellant and her de facto
spouse. The adjusted income is the total of the two incomes.
That, in fact, was not the financial agreement between the
appellant and her de facto spouse. In that respect, the appellant
argued that their agreement was no different from the agreements
of many other de facto spouses.
[17] As the appellant stated, the sharing
agreements between de facto spouses who are not the two parents
of the children living with them are sometimes not the same as
those relating to a traditional family, particularly in cases
where each of the de facto spouses has his or her own children
and it is accepted by both de facto spouses that the parent alone
has obligations and rights with respect to his or her child.
[18] However, the Act makes no
provision for these subtleties, which it should perhaps be made
to address in cases where de facto spouses each have their own
children and do not agree to contribute to the education and
support of each other's children, preferring to preserve
their own patrimony for their own children. It seems unfair in
these circumstances to add to the income of the child's
parent the total income of the other spouse since there is no
contribution to the education and financial support of the child.
This seems contrary to the purpose Parliament intended in
establishing the Canada Child Tax Benefit. However, it is for
Parliament to amend the Act. The Act being what it
is at present, the appeal shall be dismissed.
Signed at Ottawa, Canada, this 6th day of December 2001.
J.T.C.C.
Email this Content