[OFFICIAL ENGLISH TRANSLATION]
2000-4710(IT)I
BETWEEN:
HÉLÈNE LEMIEUX,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
Appeal heard on September 4, 2001, at
Montréal, Quebec, by
the Honourable Judge Alain Tardif
Appearances
For the
Appellant:
The Appellant herself
Counsel for the
Respondent:
Stéphanie Côté
JUDGMENT
The appeal
from the assessment made under the Income Tax Act for the
1998 taxation year is dismissed and the Court orders that the
$100 filing fee for this appeal be returned to the appellant.
Signed at Ottawa, Canada, this 21st day of
September 2001.
J.T.C.C.
Translation certified true
on this 3rd day of February 2003.
Sophie Debbané, Revisor
[OFFICIAL ENGLISH TRANSLATION]
Date: 20011019
Docket: 2000-4710(IT)I
BETWEEN:
HÉLÈNE LEMIEUX,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR JUDGMENT
(Judgment delivered orally from the Bench
on September 4, at Montréal, Quebec, and Reasons edited at
Ottawa, Ontario, on October 19, 2001)
Tardif, J.T.C.C.
[1] The Appellant is
appealing from the assessment in respect of the 1998 taxation
year.
[2] The issue is
whether the appellant was entitled to claim an additional
$4,153.61 paid by her as a deduction for legal expenses for the
1998 taxation year.
[3] The reassessment
in dispute in this appeal was made on the basis of the following
assumed facts:
[TRANSLATION]
(a)
Jacques Martel (hereinafter "the former spouse") and
Hélène Lemieux (the appellant) have been
divorced since December 16, 1992 (divorce judgment not
available);
(b)
they have two children:
Marie-Ève, who was born on October 5, 1984, and
Maxime, who was born on June 17, 1986;
(c)
the appellant submitted a letter dated December 14, 1998, from
Louise Woodfine, her lawyer, confirming that she had received
$6,369.26 from the appellant in 1998 to pay fees, disbursements
and taxes;
(d)
a statement of account that Ms. Woodfine sent the appellant on
January 18, 2000, for the 1998 taxation year reads as
follows:
You retained my services to:
(i) obtain a
judgment concerning support for your children, which had
previously been paid in accordance with an agreement between you
and Mr.
Martel
($3,555.61)
(ii) contest the appeal
from the
judgment
($1,650.32)
(iii)
contest the motion to vary custody and reduce
support
($565.33)
(e)
there is an unjustified $604 [sic] difference between the
$6,369.26 deduction claimed for legal expenses and Ms.
Woodfine's statement of account for $5,369.26;
(f) in auditing
the appellant's tax return for the 1998 taxation year, the
Minister determined that the legal expenses were not deductible,
partly because they were incurred to obtain a judgment
establishing support or another allowance payable on a periodic
basis and partly because they were legal expenses not justified
by the appellant and her lawyer.
The appellant admitted paragraphs (a), (b),
(c), (d)(i), (d)(ii), (d)(iii) and (e).
[4] Relying on a
directive, the appellant argued that she was entitled to claim an
additional $4,153.61 as a deduction for legal expenses for the
1998 taxation year.
[5] The respondent
argued that the appellant was not entitled to claim that
additional $4,153.61 as a deduction for legal expenses for the
1998 taxation year; the reasons why the deduction was disallowed
are listed in paragraph 5(f) of the Reply to the Notice of
Appeal, reproduced above.
[6] The appellant
asserted that all the amounts paid were deductible because they
were outlays made in connection with legal proceedings relating
to a support judgment, the contesting of the appeal from the
judgment and the contesting of the motion to vary custody and
reduce support.
[7] The appellant
claimed a deduction of $6,369.26, which is $604 more than the
amount itemized by her lawyer (see paragraphs (d)(i), (ii) and
(iii)), which totalled $5,771.26.
[8] The respondent
agreed that part of the amounts paid by the appellant were
deductible on the basis of the explanations provided but refused
to accept the balance of $4,153.61 as a deductible amount.
[9] This question of
entitlement to claim amounts paid to obtain support or contest
such an application, as a deduction for legal expenses, has been
addressed in several decisions of the Tax Court of Canada; it is
not always easy to identify the test or tests for determining
whether the judicial and extrajudicial fees paid to obtain
support or contest such an application are deductible.
[10] In Bergeron v.
Canada, [1999] T.C.J. No. 510 (Q.L.), the Honourable Judge
Pierre Archambault of this Court made an exhaustive analysis of
both the case law and the relevant statutory provisions and
finally concluded that the provisions of the Income Tax
Act did not authorize such a deduction. In paragraph 57
of his judgment, Judge Archambault stated the following:
Since there is no provision in the Act
authorizing the deduction of legal expenses incurred to collect
or contest the payment of support, Mr. Bergeron unfortunately
cannot claim such a deduction in computing his income. For him to
be entitled to such a deduction, Parliament would have to again
amend the Act so as to provide for that deduction in
section 60. I would add that such an amendment would also be
necessary to authorize the deduction of legal expenses incurred
to collect or establish a right to support.
[11] In Pierre Mathieu
v. Canada, [2001] T.C.J. No. 542 (Q.L.), rendered on August
15, 2001, I completely accepted Judge Archambault's
conclusions. Since I am still of the same opinion, and on the
basis of the same logic, I must dismiss the appeal for the same
reason, namely, that the deduction claimed is not provided for by
the Income Tax Act.
Signed at Ottawa, Canada, this 19th day of
October 2001.
J.T.C.C.
Translation certified true
on this 3rd day of February 2003.
Sophie Debbané, Revisor
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