Bernier v. Canada, 2005 FCA 337

Date:  20051018

Docket:  A-413-04

Citation:  2005 FCA 337

CORAM :      DÉCARY J.A.

LÉTOURNEAU J.A.

NOËL J.A.

BETWEEN:

                                                               RÉAL BERNIER

                                                                                                                                            Appellant

                                                                           and

                                                    HER MAJESTY THE QUEEN

                                                                                                                                        Respondent

                                    Hearing held at Québec, Quebec, on October 18, 2005.

                   Judgment delivered from the bench at Québec, Quebec, on October 18, 2005.

REASONS FOR JUDGMENT:                                                                                         NOËL J.A.

Date: 20051018

Docket:  A-413-04

Citation:  2005 FCA 337

CORAM :      DÉCARY J.A.

LÉTOURNEAU J.A.

NOËL J.A.

BETWEEN:

                                                               RÉAL BERNIER

                                                                                                                                            Appellant

                                                                           and

                                                    HER MAJESTY THE QUEEN

                                                                                                                                        Respondent

                                     REASONS FOR JUDGMENT OF THE COURT

(Delivered from the bench at Québec, on October 18, 2005)

NOËL J.

[1]               The appellant has not convinced us that Paris J. of the Tax Court of Canada erred in disallowing the interest expense deduction of $29,755.33 claimed in respect of his 1998 taxation year.  In our view, the trial judge was correct in finding that the appellant had not established that the borrowed capital had been used for an identifiable income-producing activity.

[2]               As regards the loss on the exchange rate, we are also of the opinion that the appeal must fail.  Paris J. agreed to increase the loss claimed by the appellant by adjusting the exchange rate applicable to the amount repaid, that is, US$65,000.

[3]               Not satisfied with that, the appellant asserted before us for the first time that the amount repaid was US$327,500 and that the loss on the exchange rate should be calculated on that basis.

[4]               Assuming that this issue is validly before us, and we draw no conclusions on this, it is impossible to establish from the record, as it stands, any loss on any amount other than the one claimed and in respect of which it is known when the amount was borrowed and repaid.  The appellant did not see fit to provide this information for the additional portion of the loan of which he informs us today; as a result, no loss on the exchange rate can be allowed on this portion of the loan.

[5]               The appeal will be dismissed with costs.

                  “Marc Noël”              

J.A.                   

Certified true translation

Michael Palles

FEDERAL COURT OF APPEAL

SOLICITORS OF RECORD

DOCKET:                                                                              A-413-04

STYLE OF CAUSE:                                                              RÉAL BERNIER v. HER MAJESTY THE QUEEN

PLACE OF HEARING:                                                        Québec, Quebec

DATE OF HEARING:                                                          October 18, 2005

CORAM :                                                                              DECARY J.A.

LÉTOURNEAU J.A.

NOËL J.A.

REASONS FOR JUDGMENT OF THE COURT BY:       NOËL J.A.

DELIVERED FROM THE BENCH BY:                           NOËL J.A.

APPEARANCES: