Date: 20001031
Docket: A-234-99
Coram: DÉCARY
LÉTOURNEAU
NOËL, JJ.A.
Between:
LAC D'AMIANTE DU CANADA, LTÉE
Appellant
- and -
HER MAJESTY THE QUEEN
Respondent
Hearing held in Montréal, Quebec, Tuesday, October 31, 2000
Judgment pronounced at the hearing in Montréal, Quebec, Tuesday, October 31, 2000
REASONS FOR JUDGMENT OF THE COURT NOËL, J.A.
Date: 20001031
Docket: A-234-99
Coram: DÉCARY
LÉTOURNEAU
NOËL, JJ.A.
Between:
LAC D'AMIANTE DU CANADA, LTÉE
Appellant
- and -
HER MAJESTY THE QUEEN
Respondent
REASONS FOR JUDGMENT OF THE COURT
(pronounced at the hearing in Montréal, Quebec
Tuesday, October 31, 2000)
NOËL J.A.
[1] This is an appeal from a judgment rendered on March 19, 1999 by Archambault J. of the Tax Court of Canada dismissing the appeal of the assessment determined pursuant to the Income Tax Act for the appellant's 1989 taxation year.1 This assessment effectively increased by $2,019,452 the proceeds of disposition of certain mining assets the appellant was deemed to have received from a sister corporation under an agreement executed on July 26, 1989.
[2] The Minister, in issuing this assessment, relied on the terms of the agreement, under which the short-term assets of $2,019,452 were conveyed to the appellant's parent corporation and not its sister corporation as the appellant claimed in submitting its tax return. Moreover, since the agreement contemplated the sale by the appellant to the sister corporation of the mining assets of the Aquarius mine in the amount of $9,500,000, of which $1,383,682 represented the price of the plant, machinery and equipment, the Minister concluded that the excess of $8,116,682 represented the consideration received by the appellant for the mining assets.
[3] The appellant does not dispute the computation or logic underlying the Minister's assessment. However, it claims it managed to demonstrate at trial that the short-term assets of $2,019,453 were part of the sister corporation's opening balance sheet. This, it says, demonstrates that these assets were likewise conveyed to it under the agreement of July 26, 1989 and that the trial judge misconstrued the evidence in drawing the opposite conclusion.
[4] We do not see how this reasoning can stand. That the short-term assets were included in the sister corporation's opening balance sheet is evidence that these assets were conveyed to it at some time prior to the making of its opening balance sheet. But this does not establish that these assets were conveyed under the agreement of July 26, 1989.
[5] To succeed in its appeal, the appellant had to demonstrate that these short-term assets were part of the property that was conveyed to the sister corporation for the sum of $9,500,000 under the agreement of July 26, 1989. In light of the evidence that was presented to him, the trial judge was entitled to find that the appellant had not managed to discharge this onus.
[6] The appeal will be dismissed with costs.
Certified true translation
Suzanne M. Gauthier, LL.L., Trad. a.
FEDERAL COURT OF APPEAL
Date: 20001031
Docket: A-234-99
Between:
LAC D'AMIANTE DU CANADA, LTÉE
Appellant
- and -
HER MAJESTY THE QUEEN
Respondent
REASONS FOR JUDGMENT OF THE COURT
| NAMES OF COUNSEL AND SOLICITORS OF RECORD |
| STYLE:LAC D'AMIANTE DU CANADA, LTÉE |
| PLACE OF HEARING:Montréal, Quebec |
| DATE OF HEARING:October 31, 2000 |
| REASONS FOR JUDGMENT OF THE COURT BY NOËL J.A. |
| Jean Groleau FOR THE APPELLANT |
| Charles Camirand FOR THE RESPONDENT |
Byers Casgrain FOR THE APPELLANT
Montréal, Quebec
Morris Rosenberg FOR THE RESPONDENT
Deputy Attorney General of Canada
Date: 20001031
Docket: A-234-99
Montréal, Quebec, Tuesday, the 31st day of October, 2000
Coram: DÉCARY
LÉTOURNEAU
NOËL, JJ.A.
Between:
LAC D'AMIANTE DU CANADA, LTÉE
Appellant
- and -
HER MAJESTY THE QUEEN
Respondent
JUDGMENT
The appeal is dismissed with costs.
Robert Décary
Certified true translation
Suzanne M. Gauthier, LL.L., Trad. a.
__________________
1 The decision is reported at 99 DTC 466.
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