Date: 20000824
Dockets: 98-711-IT-I
BETWEEN:
RAYNALD TREMBLAY
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
Reasons for Judgment
Tardif, J.T.C.C.
[1]
This appeal concerns the 1993, 1994 and 1995 taxation years. The
issue to be decided is whether the additional taxable benefits,
amounting to $9,358 for each of the 1993, 1994 and 1995
taxation years, that were included in the appellant's income
for those years, were correctly calculated.
[2]
By consent of the parties, this judgment is rendered on the basis
of all the exhibits filed and of the transcript of all the
testimony and counsel's argument.
Facts
[3]
During the years in issue, the appellant owned all the shares of
numbered company 2643-5446, which operated a bowling alley. At
that time, the bowling alley was located at 1472 Wallberg
Boulevard, several buildings from 1284 Wallberg where the
appellant lived with his family. The company was then leasing the
premises occupied by the bowling alley.
[4]
In August 1994, the appellant incorporated another company,
9004-9693 Québec Inc., with he himself holding 75
percent of the shares and his wife,
Hélène Gaudreault, the other 25 percent. This
company was located at 341 Vézina Boulevard, in
Dolbeau. The company built the building housing the bowling alley
and related enterprises, including a restaurant, a bar, a bowling
boutique and a catering service.
[5]
At that location, the company operated the bowling alley under
the name of Salon de Quilles Dolbeau Enr. and it was located
approximately 2.7 kilometers from the family residence. With 14
lanes, and with 15 employees during the busy season, the Salon de
Quilles Dolbeau Enr. could accommodate as many as
210 people.
[6]
Activities ranged from general sports to inter-league
competitions; there were also numerous tournaments and parties,
as well as gatherings of office and factory workers, families and
so on. The bowling alley was in operation from the end of August
to mid-May every year.
[7]
During the years in question, the company had placed a 1992 Dodge
Grand Caravan 4 x 4 ("Dodge Caravan") at the
appellant's disposal.
[8]
The dispute has to do with whether the use of that vehicle was a
taxable benefit. The respondent maintains that the use of the
vehicle in question was a taxable benefit for the appellant. The
appellant, however, submits that the distance that the vehicle
was driven for his personal use was less than 10 percent of the
total distance driven and, therefore, he did not derive any
personal benefit from the vehicle from a tax point of view.
[9]
The evidence primarily concerned the appellant's schedule. He
described his work as an activity that monopolized his time,
seven days a week and over 12 hours a day. With regard to the
inactive period from mid-May to mid-August, the appellant said he
laid off his employees but devoted all his time to refurbishing
and making repairs and improvements to the bowling alley, as well
as to preparing for the upcoming bowling season.
[10] Along
with his activities related to the operation of the business, the
appellant was involved—and he testified at length on
this—in the Association des salons de quilles du
Saguenay-Lac St-Jean and the Association des salons de
quilles du Québec ("ASQ"), as well as the
Fédération des associations de salons de quilles du
Québec, in which he served as president for three years
for the ASQ and was a technical director.
[11] The
appellant had to travel periodically for the two associations and
ran up significant kilometrage for which he received no
compensation. This was characterized by the respondent as
volunteer work.
[12] On this
volunteering issue, the parties submitted opposing views. The
respondent saw it as an essentially personal activity that had
nothing to do with the operation of the business that owned the
vehicle that is at the heart of the dispute, while the appellant
considered that activity to be related to the operation of the
bowling alley.
[13] On this
subject, I believe that it was indeed an activity related to the
bowling alley, and its sole aim was the consolidation and
development of the sport of bowling and its sidelines. Were it
not for the fact that he derived his livelihood from this
activity, I doubt whether the appellant would have shown as much
interest and, above all, so much commitment. Therefore, under the
circumstances, I believe that the kilometers driven for the
purpose of participating in the various associations should not
be excluded.
[14] The
appellant argued that the Dodge Caravan was used almost
exclusively for the operation and smooth running of the business.
He listed and described the various uses, including errands,
transporting players, participating in competitions, numerous
contacts with potential clients, renewal of the inventory
required for the business and participation in many meetings,
etc. In sum, the appellant argued that the Dodge Caravan, which
was used 95 percent of the time by him, was exclusively for
company activities, with the exception of the distance driven
between the place of business and his
residence—approximately 2.7 kilometres—and a trip or
two to the Charlevoix area.
[15] The
appellant called Gabriel Dubé to testify in his
capacity as accountant and consultant for the business. The Court
was unimpressed by the testimony of Gabriel Dubé, who
described himself as a public accountant and consultant. He said
he was a regularly-consulted resource person, and he testified as
if it were his own case that was involved. He even ventured
comments and observations that arose more from his intuition than
from facts of which he had direct personal knowledge.
[16] As an
expert, he should have known that the burden of proof is on the
taxpayer and, that being so, that it is vital that he give his
clients good advice. However, not only did he not advise the
appellant to keep a log to record the business use of the
vehicle, but he also tried to devalue the relevance of such a
log, adding that none of his clients kept one.
[17] The
appellant also called Poulin Tremblay who had known the
appellant for some ten years. He described the appellant as
heavily involved in the bowling world. He himself had been
associated with bowling for more than 35 years and, as the owner
of a number of bowling alleys, he described the many constraints
and requirements with which bowling alley operators must
deal.
[18] He
confirmed that the appellant received absolutely nothing for the
many trips he made for the various association meetings. He also
explained the many concerns and requirements involved in the
operation, consolidation and development of bowling alleys.
[19] While
Mr. Tremblay's testimony certainly gave the Court a
better understanding and awareness of the requirements and
constraints associated with the operation of a bowling alley, it
did not contribute anything significant regarding the
appellant's personal use, if any, of the vehicle placed at
his disposal by the company.
[20] The
evidence established that the vehicle was driven between 25,000
and 30,000 kilometers a year. The appellant asserted that,
when the bowling alley was located on Wallberg Boulevard, a few
buildings from his residence, he often walked to his place of
business, which makes one wonder whether the vehicle was really
that essential for the daily needs of the business. During the
second phase of the business's existence, the distance
between the business and his residence was between 2.6 and 2.7
kilometers.
[21] The
evidence also showed that the appellant may have used his vehicle
on several occasions to drive to Charlevoix, until a property he
had there was sold in January 1995.
[22] Apart
from these well-established facts, the evidence also showed that
the business was inactive every year from mid-May to the end of
August, or roughly three months.
[23] With
respect to these summer periods, although the appellant said he
took advantage of them to make repairs and improvements, to do
painting and to prepare for the new season, the evidence was
rather sparse as to what daily use was made of the vehicle during
those periods, except for the fact that the appellant had to
attend a number of meetings.
Analysis
[24] The
appellant argued that his personal use of the company vehicle was
less than 10 percent. Having regard to the annual kilometrage, 10
percent would be equivalent to between 2,500 and
3,000 kilometers a year, or between 50 and 60 kilometers a
week, which is very little, given that the company's place of
business was in an area of Quebec where the distances between
communities are relatively great.
[25] Based on
the fact that the only personal use made of the company vehicle
was driving the 2.7 kilometers between his residence and the
company's place of business, the appellant concluded that his
personal use was on the order of 6.69 percent to
7.78 percent.
[26] This is
an assumption that presupposes that the vehicle was used for
personal reasons only to make that trip. It does not take into
account any other personal use, including possible trips to
Charlevoix, concerning which the appellant was unable to provide
specific figures.
[27] Given
those circumstances, a log would have been very useful,
especially since the appellant should have known that he had to
rebut the presumption that he had personally benefited from use
of the company vehicle.
[28] The
evidence tendered by the appellant was basically circumstantial.
He established that his was a very demanding business to which he
had to devote himself completely, from which it followed that he
never had time to use the vehicle for personal purposes.
[29] The
respondent supported and fleshed out her claims with references
to the Income Tax Act (the "Act")
and relevant case law. For his part, the appellant argued
essentially that each case stood on its own merits, that this was
a unique case in which the evidence had revealed special facts
requiring that the validity of his claims be upheld.
[30] I do not
think the case law can be overlooked, especially since the facts
are not as special and unique as the appellant claimed. The
judgment of the Federal Court of Appeal in Adams v.
Canada, [1998] F.C.J. No. 397 (Q.L.) is quite on
point. It is appropriate to reproduce some excerpts from that
case, in which Robertson J.A expressed himself as follows:
. . .
6.
In calculating the income of each taxpayer the Partnership did
not include the $1.2 million lease inducement payment as income
of the Partnership, either for accounting or taxation purposes.
Apparently, it was believed that the payment constituted a
non-taxable capital benefit. As a result none of the eighteen
doctors included in income the $66,666 received. This was a
common assumption prior to the enactment of section 12(1)(x) of
the Income Tax Act . . . . On the other hand, in computing income
from property for the 1985 to 1988 taxation years, each doctor
deducted his or her respective share of the rental inducement
amount paid by the Bare trustee to the Partnership as a deferred
leasing cost amortized over ten years. In summary, each taxpayer
took a deduction with respect to the tenant inducement payment,
but none included the amount received as income in any of the
taxation years in question.
. . .
[31] The
appellant's interpretation of the Act is very simple.
First, he refused to acknowledge that the company had placed the
Dodge Caravan at his disposal, maintaining that the vehicle was
used only for the company's business. Next, he submitted
that, even if the company placed the vehicle at his disposal, his
use of it was less than 10 percent of total use, and that, he
claimed, had the effect of cancelling any personal benefit from
having the vehicle at his disposal.
[32] The
provisions of the Act cannot be interpreted as simply as
that, especially as the case law rejects any such interpretation
and provides all necessary indications as to the approach to be
taken in that regard.
[33] First of
all, I believe it is important to establish whether the appellant
received a benefit from 9004-9693 Québec Inc. On
that point, there can be no doubt, since the appellant
acknowledged that the Dodge Caravan was at his disposal, and he
himself put that availability at 95 percent.
[34]
Paragraph 6(1)(a) of the Act reads as
follows:
6.
Amounts to be included as income from office or
employment.
(1) There shall be included in computing the income of a taxpayer
for a taxation year as income from an office or employment such
of the following amounts as are applicable:
(a)
Value of benefits — the value of board, lodging and
other benefits of any kind whatever received or enjoyed by the
taxpayer in the year in respect of, in the course of, or by
virtue of an office or employment, except any benefit
(i)
derived from the contributions of the taxpayer's employer to
or under a registered pension plan, group sickness or accident
insurance plan, private health services plan, supplementary
unemployment benefit plan, deferred profit sharing plan or group
term life insurance policy,
(ii)
under a retirement compensation arrangement, an employee benefit
plan or an employee trust,
(iii)
that was a benefit in respect of the use of an automobile,
(iv)
derived from counselling services in respect of
(A) the
mental or physical health of the taxpayer or an individual
related to the taxpayer, other than a benefit attributable to an
outlay or expense to which paragraph 18(1)(l) applies,
or
(B)
the re-employment or retirement of the taxpayer, or
(v)
under a salary deferral arrangement, except to the extent that
the benefit is included under this paragraph because of
subsection (11).
[35] To grasp
the scope of this section, it is essential to understand the
meaning of the word "benefit". Rather than writing at
great length on the breadth and meaning of this concept, I prefer
to turn to the analysis of Judge Pierre Archambault of
this Court who very explicitly dealt with the concept of benefit
in Luc Dionne v. The Queen, [1996] T.C.J. No. 1691. I
consider it appropriate to reproduce some excerpts from that
decision in which Judge Archambault expressed himself as
follows:
[12] For the
Minister to be able to include the transportation allowance of
$3,181.34 in Mr. Dionne's income under paragraph 6(1)(a) of
the Act, it had to represent the "value" of a
"benefit" that Mr. Dionne "received" or
"enjoyed" in 1993 "by virtue of a contract of
employment". . . .
[17] First let
us analyse the common meaning of the word "avantages"
[the equivalent of "benefits" in the French text of the
provision . . .]. This seems to me to be the most important word
in this paragraph. The Nouveau Petit Robert defines it as
follows:
[TRANSLATION]
II - 1 - (1196) What is useful, profitable (as opposed to
disadvantage). - 2. asset;
profit, interest,
advantage. This solution offers, holds out major,
invaluable benefits. To withdraw an appreciable benefit from
someone. These projects are equally appealing; each has its
benefits. To confer, offer, obtain, guarantee appreciable
benefits on or for someone. Cash benefit. -
gain, remuneration,
compensation. Benefits in kind.* To forego a real
benefit for an illusory gain (cf. To drop the substance for the
shadow*). - interest. The new man
"apparently asked for exorbitant benefits, a share in
profits" (Duhamel). [. . .] ANT. Disadvantage,
detriment, damage,
handicap, disbenefit,
prejudice.
The word "profitable" comes from "profit"
which, according to the same dictionary, means "the increase
in assets that one owns or the improvement of a situation
resulting from an activity. - benefit,
profit. Material, intellectual, moral gain. -
enrichment." As the purpose of paragraph
6(1)(a) is to expand the notion of employment income that appears
in subsection 5(1) of the Act, paragraph 6(1)(a) clearly does not
concern moral or intellectual benefits, but solely material
benefits, that is to say those "consisting of tangible
assets (esp. money), or attaching to the possession thereof"
(Nouveau Petit Robert). (See also Savage and Blanchard, supra.)
"Situation" means in particular "2- (XVIIth).
(Abstract) Set of circumstances in which one finds oneself
- circumstance, condition,
state; place,
position."
[18] The word
"benefits" may therefore have two meanings: one that
recognizes a benefit where there is an increase in assets (and
thus of one's net worth) and the other where there is an
improvement of a person's economic situation without there
necessarily being an increase in assets. Such an
"improvement" may occur not only where an employer
provides an employee with the mere enjoyment of an asset, but
also where he makes a payment to a third party in respect of an
expense incurred for a good or a service for the employee's
benefit.
[19] Let us
consider whether these two meanings are consistent with the
wording of paragraph 6(1)(a). In reading it, one notes that there
are a number of reasons to conclude that these two meanings are
recognized therein. First, there is the use of the expression
"of any kind whatever" following the word
"benefits", which clearly suggests that this paragraph
concerns all benefits, whatever form they may take and whether or
not they increase the employee's net worth.
[20] Even if
there could be the slightest doubt as to the scope of the term,
it vanishes when it is seen that the paragraph expressly includes
in benefits the board and lodging provided to the employee. These
two benefits do not increase the employee's net worth. They
merely spare him an expense which, if it had been incurred by the
employee, would have reduced his net worth. No one will dispute
that an employee receives a net economic benefit when an employer
houses him free of charge.
[21] In
addition, the use of the verbs "receive" and
"enjoy" distinguish the case of an employee who has
"received" benefits that increase his net worth, such
as ownership of an automobile for his personal use, from that of
an employee who has merely "enjoyed" benefits which,
without increasing his net worth, "improve his
situation", such as that arising from the use of an
automobile for personal purposes to the extent that the benefit
relates to its operating expenses. The latter benefit was
expressly embraced by subparagraph 6(1)(a)(iii) of the Act prior
to 1993.
[36] Thus, the
question is not whether the recipient of a benefit really
profited from it and to what extent. It is sufficient that he had
the possibility of making use of the benefit or the right to make
use of it. The mere fact of being able to use, for his own
purposes, a vehicle that is the property of his employer is in
itself a benefit. In this case, the appellant could use or could
have used the vehicle for broader purposes than those he
described. Furthermore, did he not acknowledge that the Dodge
Caravan would have been more reliable and safer for his personal
trips to Charlevoix if the weather had been bad?
[37] He had
available to him a roomier and safer vehicle with no constraints
on how often he could use it. This fact alone is enough to find
that there was indeed a benefit.
[38] The fact
that the vehicle was never used or very minimally used in no way
nullified the benefit. The mere fact of having the right to use
it is in itself a benefit under the Act.
[39] A standby
charge for an automobile is provided for in
paragraph 6(1)(e), which reads as follows:
(e)
Standby charge for automobile — where the
taxpayer's employer or a person related to the employer made
an automobile available to the taxpayer, or to a person related
to the taxpayer, in the year, the amount, if any, by which
(i)
an amount that is a reasonable standby charge for the automobile
for the total number of days in the year during which it was made
so available
exceeds
(ii)
the total of all amounts, each of which is an amount (other than
an expense related to the operation of the automobile) paid in
the year to the employer or the person related to the employer by
the taxpayer or the person related to the taxpayer for the use of
the automobile.
[40] Finally,
what constitutes reasonable standby charges for an automobile is
covered in subsection 6(2) of the Act, which reads as
follows:
(2)
Reasonable standby charge. For the purposes of paragraph
(1)(e), a reasonable standby charge for an automobile for
the total number of days (in this subsection referred to as the
"total available days") in a taxation year during which
the automobile is made available to a taxpayer or to a person
related to the taxpayer by the employer of the taxpayer or by a
person related to the employer (both of whom are in this
subsection referred to as the "employer") shall be
deemed to be the amount determined by the formula
A× [(2 % × (C × D) + 2
× (E - F)]
B
3
where
A
is the lesser of
(a)
the total number of kilometres that the automobile is driven
(otherwise than in connection with or in the course of the
taxpayer's office or employment) during the total available
days, and
(b)
the value determined for B for the year under this subsection in
respect of the standby charge for the automobile during the total
available days,
except that the amount determined under paragraph (a)
shall be deemed to be equal to the amount determined under
paragraph (b) unless
(c)
the taxpayer is required by the employer to use the automobile in
connection with or in the course of the office or employment,
and
(d)
all or substantially all of the distance travelled by the
automobile in the total available days is in connection with or
in the course of the office or employment;
B
is the product obtained when 1,000 is multiplied by the quotient
obtained by dividing the total available days by 30 and, if the
quotient so obtained is not a whole number and exceeds one, by
rounding it to the nearest whole number or, where that quotient
is equidistant from two consecutive whole numbers, by rounding it
to the lower of those two numbers;
C
is the cost of the automobile to the employer where the employer
owns the vehicle at any time in the year;
D
is the number obtained by dividing such of the total available
days as are days when the employer owns the automobile by 30 and,
if the quotient so obtained is not a whole number and exceeds
one, by rounding it to the nearest whole number or, where that
quotient is equidistant from two consecutive whole numbers, by
rounding it to the lower of those two numbers;
E
is the total of all amounts that may reasonably be regarded as
having been payable by the employer to a lessor for the purpose
of leasing the automobile during such of the total available days
as are days when the automobile is leased to the employer;
and
F
is the part of the amount determined for E that may reasonably be
regarded as having been payable to the lessor in respect of all
or part of the cost to the lessor of insuring against
(a)
loss of, or damage to, the automobile, or
(b)
liability resulting from the use or operation of the
automobile.
[41] The
formula in subsection 6(2) of the Act is very
explicit and sets out the exact amounts that must be included in
the income of the recipient of the benefit. That is an exercise
in which there is no room for discretion or subjective
evaluation. The formula is basically a mathematical one and
contains two assumptions that cannot be ignored.
[42]
Paragraph 6(1)(e) and subsection 6(2) take no
account of whether or not the recipient of the benefit used the
vehicle.
[43] Robertson
J.A. of the Federal Court of Appeal, in Canada v. Adams,
[1998] F.C.J. No. 477, provided a very good explanation of
the parameters of these provisions. It is appropriate to
reproduce a few excerpts from that judgment:
[6] I
agree with the Minister that the term "made available"
cannot bear the restricted or narrow interpretation adopted by
the learned Tax Court Judge. In the reasons that follow I offer
four reasons in support of that conclusion. . . .
[8] .
. . Within this context, it is clear to me that the broad and
unqualified language found in both linguistic versions of
paragraph 6(1)(e) reinforces the Minister's argument that
unrestricted use of an automobile is not a condition precedent to
the application of that provision. Further support for this
understanding is found in the legislative history of that
provision.
. . .
[10] . . . The
amendment removed all references to an automobile being made
available for personal use. I take it for granted that the
purpose of the amendment was to repeal the understanding
established in Harman that minimal personal use of an automobile
was sufficient to oust the application of paragraph 6(1)(e). . .
.
[11] . . . As
part of the contextual analysis, I turn now to subsection 6(2)
which dictates the bases on which standby charges are to be
calculated. It is my opinion that that provision also supports
the Minister's position.
[12] . . . The
first assumption is that the employee made personal use of the
automobile during the year. The second assumption is that
personal usage amounts to 1000 km for every month the automobile
is made available to the employee (12000 km per year). . . .
[13] . . . A/B
x [1 1/2% x (C x D)]. . . .
[14] Against
this background, it is apparent that both paragraph 6(1)(e) and
subsection 6(2) are unconcerned with whether in fact an employee
made use of an employer's automobile. Paragraph 6(1)(e) makes
no reference to the purposes for which the automobile is made
available and, in particular, no longer makes reference to
personal use by an employee. . . .
[15] . . . It
is actual usage which is of significance not whether an employee
had unrestricted or exclusive use of an employer's
automobile. It is also important to note that actual usage only
becomes relevant within the context of the minimal personal use
exception articulated in subsection 6(2).
. . .
[17] In
summary, the broad wording used in both linguistic versions of
paragraph 6(1)(e), coupled with its legislative history, support
the Minister's position. In my respectful view, unrestricted
or exclusive use of an employer's automobile is not a
condition precedent to the imposition of a standby charge. Nor is
actual usage required, whether it be for personal or business
purposes. What is required is that an employer have made an
automobile available to, or at the disposition of, an employee
and, correlatively, that he or she have had a right to use it.
This is only logical since subsection 6(2) deems an employee to
have made personal use of an employer's automobile,
irrespective of whether this is so. . . . That being said the
harsh consequences which flow from a deeming provision are
tempered by the "minimal personal use" exception
grafted on to subsection 6(2) in response to this Court's
decision in Harman. This is the point in time where actual usage
and the purposes for which the automobile was made available
become relevant considerations.
[44] In short,
as soon as an automobile is made available, there is a
presumption that 12,000 kilometers a year or 1,000 kilometers a
month are driven for personal purposes.
[45] As this
is a presumption, it may be rebutted by clear and explicit
evidence of actual use in terms of kilometers driven, which is
why a log is practically indispensable.
[46] This,
moreover, is what emerges from the judgment in Lavigueur v.
M.N.R., 91 DTC 448, rendered by
Judge Pierre Dussault of this Court. In that case, the
appellant was a shareholder of a company that made available to
him a leased automobile for his work. That work consisted in
making daily visits to the Lavigueur jewellery stores located on
the South Shore, in Montreal and on the North Shore, and to
various suppliers. As he lived in Ste-Julie, he returned
home with the vehicle since it would have been unwise and even
dangerous to leave it in the parking lot next to the head office
in Pointe-aux-Trembles. With respect to the
kilometers driven for personal purposes, the appellant, who kept
no log, maintained that he had used the vehicle very minimally,
indeed only exceptionally, for such purposes since he had the use
of another vehicle for his personal needs. The analysis of Judge
Dussault was as follows:
. . .
Thus the appellant admitted having had the automobile
available to him in the evening and on weekends, but stated that
he used it for personal purposes only exceptionally. He further
stated that he had another automobile for that purpose, which,
while it was much older and more modest, fully sufficed for the
limited needs of going out in the evening or on weekends. The
appellant, however, was not very specific in terms of the total
kilometres travelled for business purposes; he stated that the
total might be 40,000 to 60,000 kilometres per year, but that he
had kept no record of this.
. . .
In order to control the benefit arising from the use for
personal purposes of an automobile owned or leased by an
employer, Parliament believed it advisable to establish a
presumption that personal use amounts to 1,000 kilometres per
month or 12,000 kilometres per year, as soon as an employer makes
an automobile available to an employee. This presumption may be
rebutted by the employee, and the Act imposes an obligation on
him do so in a specific manner, "in the prescribed
form", when there is less use for personal purposes. In that
case, the application of the arithmetic formula in subsection
6(2) operates to reduce the amount to be included in the
employee's income proportionately. If an employee does not
comply with the obligation thus imposed by the Act, how can he
later argue that the Department of National Revenue was wrong to
include in his income the amount set out in subsection 6(2) of
the Act, which results from the application of the presumption
established therein?
[47] In the
case at bar, the appellant acknowledged that just the trips he
made between his residence and the company's place of
business represented about 7 percent of the total kilometers
driven in the vehicle, give or take 3 percent. He submitted, on
the basis of essentially circumstantial evidence, that his
schedule and the demands of the business simply did not allow him
to drive more kilometers for personal purposes than those he had
to drive to go back and forth between work and home.
[48] The
appellant submitted that in mathematical terms he drove about
2,000 kilometers a year for personal purposes and could not have
driven any more than 3,000 given his professional activities.
[49] The
burden of proof was on the appellant, not the respondent. It was
not enough to state and reiterate that he had used the vehicle
made available to him by the company essentially for travel
between home and work and to conclude that the kilometrage
represented by that travel was less than 10 percent of the total.
Moreover, the evidence established that the appellant's
calculations were not as absolute as he maintained. Did he use
the vehicle to go to Charlevoix? The answer was: perhaps once, it
depended on the weather.
[50] As the
appellant lived in an area where roads are often snow-covered or
icy, it is more than likely that the Dodge Caravan was used
regularly for family needs in winter.
[51] It is
easy to imagine many situations in which it would have been
logical, appropriate and reasonable to use the Dodge Caravan
rather than the other family vehicles. It was not up to the
respondent to prove those situations.
[52] Although
the appellant's accountant described it as unrealistic and
even archaic, the fact is that a log is undoubtedly the best
means of establishing clearly and explicitly the number of
kilometers actually driven for personal purposes.
[53]
Certainly, there is no strict obligation to keep such a log,
except that a person who decides not to keep one will have a real
problem proving the exact use to which the vehicle was put.
Circumstantial evidence is certainly not the ideal way to rebut
the presumption that comes into play against a person to whom a
vehicle has been made available his employer.
[54] The
quality of the evidence tendered by the appellant and, above all,
the lack of a plausible basis for his assertions, mean that he
did not fulfil the obligation that was imposed on him by the
Act in respect of the 1993, 1994, and 1995 taxation years
and that he had to meet if he did not wish to be taxed on the
amount resulting from the computation set out in the Act,
or if he wished to be taxed on a lesser amount.
[55] For these
reasons, the appeal is dismissed.
Signed at Ottawa, Canada, this 24th day of August 2000.
"Alain Tardif"
J.T.C.C.
Translation certified true on this 19th day of October
2001.
[OFFICIAL ENGLISH TRANSLATION]
Erich Klein, Revisor
[OFFICIAL ENGLISH TRANSLATION]
98-711(IT)I
BETWEEN:
RAYNALD TREMBLAY,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
Appeal heard on September 14, 1998, at
Chicoutimi, Quebec, by
the Honourable Judge Guy Tremblay
Appearances
Counsel for the
Appellant:
Régis Gaudreault
Counsel for the
Respondent:
Pascale O'Bomsawin
JUDGMENT
The
appeal from the assessments made under the Income Tax Act
for the 1993, 1994 and 1995 taxation years is dismissed in
accordance with the attached Reasons for Judgment.
Signed at Ottawa, Canada, this 24th day of August 2000.
J.T.C.C.
Translation certified true
on this 19th day of October 2001.
Erich Klein, Revisor
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