Lamarre
J.T.C.C.:-This
is
an
appeal
under
the
informal
procedure
from
an
assessment
of
$10,000
dated
October
20,
1992
made
by
the
Minister
of
National
Revenue,
(hereinafter
the
"Minister”),
under
section
160
of
the
Income
Tax
Act,
R.S.C.
1952,
c.
148
(am.
S.C.
1970-71-72,
c.
63)
(the
’’Act”).
In
assessing
the
appellant
the
Minister
relied
on
the
facts
raised
in
paragraph
6
of
the
reply
of
the
notice
of
appeal
which
reads
as
follows:
6.
In
so
assessing
the
appellant,
the
Minister
made
the
following
assumptions
of
fact:
(a)
the
facts
hereinbefore
admitted;
(b)
on
or
about
May
25,
1991,
Mr.
Ed
Delisle
(the
"transferor")
transferred
cash
in
the
amount
of
$10,000
(the
"property")
to
the
appellant;
(c)
the
transferor
is
the
son
of
the
appellant
and
as
such
the
transferor
and
the
appellant
were
not
dealing
at
arm’s
length;
(d)
at
the
time
of
transfer,
the
fair
market
value
of
the
consideration
given
by
the
appellant
for
the
property
was
zero;
(e)
the
aggregate
of
all
amounts
that
the
transferor
was
liable
to
pay
under
the
Act
in
or
in
respect
of
the
taxation
year
in
which
the
property
was
transferred
or
any
preceding
taxation
year
was
at
least
$26,671.18.
The
appellant
and
her
son
testified
at
the
hearing.
The
evidence
disclosed
that
the
appellant’s
son
sold
his
residence
for
an
amount
of
$27,000.
He
was
experiencing
difficulties
with
his
ex-girlfriend
and
he
asked
his
mother
to
keep
an
amount
of
$10,000
in
her
house
for
him.
The
mother,
the
appellant,
said
that
she
was
not
willing
to
keep
cash
in
her
house
and
she
candidly
offered
him
to
deposit
the
money
in
a
dormant
savings
account
she
still
had.
This
account
was
opened
in
July
1988
when
she
was
working.
The
last
deposit
she
made
in
that
account
was
in
June
1989
when
she
stopped
working.
She
kept
the
account
open,
following
her
husband’s
advice,
but
never
made
any
transaction
out
of
it
for
herself.
Her
son
deposited
the
$10,000
in
this
bank
account
on
May
25,
1990.
He
moved
in
her
house
and
she
gave
him
the
banking
card
to
make
automatic
withdrawals
from
this
account.
On
three
occasions
he
needed
more
money
than
the
maximum
allowed
on
automatic
cash
withdrawals
and
therefore
asked
her
if
he
could
borrow
money
from
her
personally.
Since
he
had
money
in
the
bank,
what
she
agreed
to
do
instead
was
to
go
to
the
bank
to
withdraw
the
money
he
needed
from
this
account.
The
first
time
she
withdrew
$1,800,
the
second
time
she
withdrew
$1,800
and
the
last
time
she
withdrew
$5,592.
He
told
her
he
needed
the
money
to
buy
a
truck
with
his
brother
and
other
material
to
earn
a
living.
She
realized
after
a
while
that
her
son
was
hiding
his
mail
without
taking
the
time
to
open
it.
Following
the
advice
of
her
husband,
she
opened
one
letter
and
realized
at
that
time
that
her
son
was
owing
money
to
Revenue
Canada.
She
immediately
went
to
her
lawyer
who
advised
her
to
close
the
bank
account
right
away
and
bring
him
the
books
of
this
account.
When
she
went
to
the
bank,
she
was
told
that
the
account
was
closed
on
August
31,
1992,
although
she
had
not
been
advised.
She
was
assessed
on
October
20,
1992.
I
am
satisfied
from
the
evidence
that
she
never
had
the
benefit
of
the
money
that
was
deposited
in
her
account.
She
was
acting
only
as
an
agent
for
her
son.
The
fact
that
she
did
not
even
authorize
the
closing
of
the
account
confirms
this
point.
In
order
to
be
liable
under
section
160
of
the
Act,
a
transfer
of
property
must
have
occurred
between
the
appellant’s
son
and
herself.
To
establish
if
there
is
a
transfer
or
not,
Judge
Thorson
from
the
Exchequer
Court
of
Canada
in
Fasken
Estate
v.
M.N.R.,
[1948]
C.T.C.
265,
49
D.T.C.
491,
said
at
page
279
(D.T.C.
497)
that:
All
that
is
required
is
that
the
husband
should
so
deal
with
the
property
as
to
divest
himself
of
it
and
vest
it
in
his
wife,
that
is
to
say,
pass
the
property
from
himself
to
her.
In
the
case
of
Dunkelman
v.
M.N.R.,
[1959]
C.T.C.
375,
59
D.T.C.
1242,
Judge
Thurlow
from
the
Exchequer
Court
of
Canada
said
at
page
380
(D.T.C.
1244):
The
expression
"has
transferred"
in
subsection
22(1)
has,
in
my
opinion,
a
similar
meaning.
All
that
is
necessary
is
that
the
taxpayer
shall
have
so
dealt
with
property
belonging
to
him
as
to
divest
himself
of
it
and
vest
it
in
a
person
under
19
years
of
age.
The
New
English
Dictionary
gives
the
meaning
of
transfer:
Law:
to
convey
or
make
over
(title,
right,
or
property)
by
deed
or
legal
process.
Can
we
say
in
the
present
case
that
the
appellant’s
son
divested
himself
of
his
$10,000
and
vested
it
to
his
mother?
I
concede
with
the
counsel
for
the
respondent
that
the
appellant
technically
had
a
right
to
use
the
funds.
However,
I
do
not
believe
that
the
$10,000
was
transferred
to
her.
The
evidence
is
clear
that
she
did
not
have
the
benefit
of
it,
but
only
her
son
did.
She
was
not
even
made
aware
of
the
closing
of
the
bank
account.
I
find
the
appellant
credible
and
I
believe
her
when
she
stated
that
she
never
used
this
money.
I
find
as
a
matter
of
fact
that
the
appellant
and
her
son
had
no
intention
of
effecting
a
valid
transfer.
For
these
reasons
I
conclude
that
she
was
only
the
agent
of
her
son
and
as
such
the
$10,000
was
never
conveyed
or
transferred
to
her.
The
appeal
is
therefore
allowed
without
costs.
Appeal
allowed.
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