Girard – Cour du Québec finds that momentary employment by a new employer was sufficient to render termination damages as a retiring allowance

Robinson found that damages received by an employee, following the amalgamation of the City of Gatineau for whom he worked and the failure of the new City to hire him, were a non-taxable receipt. The same result did not obtain where a taxpayer who had been appointed by a transitional committee to be the chief executive of the new amalgamated city (in this case Saguenay) was fired by the mayor on the second day of existence of the new City (with that decision ratified a week later) – so that his subsequent award of damages was a retiring allowance. Lavoie JCQ stated:

The very short duration of this employment from the beginning of the existence of the new city to his dismissal…does not allow us to discard the notion that he was compensated for losing employment that had been acquired by him.

Neal Armstrong. Summary of Girard v. Agence du revenu du Québec, 2017 QCCQ 3245 under s. 248(1) - retiring allowance.