Terry S. Bergman v. Her Majesty the Queen, [1994] 1 CTC 22

Isaac, C.J (Robertson and McDonald, JJ.A., concurring): —This section 28 application seeks to review and set aside a decision of the Tax Court which dismissed the applicant's appeal from the reassessment of his income tax return for the taxation year 1989.

The applicant is the father of a child born in 1985 to him and to a woman with whom the applicant had lived without benefit of clergy. The applicant and the woman began living apart in 1985 before the birth of tne child. Since January 1, 1987 the applicant had been paying to the woman, as support of the child, the sum of $300 per month. On December 30, 1989, the applicant and the woman executed a “separation agreement" which provided that the applicant would continue to pay the sum of $300 per month as support for the child until the happening of certain events which are not relevant to issues in dispute. The woman declared these payments as income in her income tax returns for the relevant years.

In his tax return for the taxation year 1989, the applicant claimed, as a deduction, the sum of $3,600 which he had paid as support during that year. On March 11, 1991, the Minister of National Revenue issued a notice of reassessment disallowing the deduction. On March 26, 1991, the applicant obtained from the Court of Queen’s Bench for Manitoba (Family Division), on consent, an order issued pursuant to the Family Maintenance Act of Manitoba, R.S.M. 1987, c. F-20, which reads in part as follows:

3. This Court orders that the following payments, having been made by the petitioner to the respondent shall be deemed to be maintenance payments for the said child pursuant to this order.

1989 $3,600

The applicant appealed the reassessment to the Tax Court of Canada in its informal procedure. There he contended, first, that the support payments made in 1989 were made pursuant to court order and, secondly, that paragraph 60(c.1) of the Income Tax Act, R.S.C. 1952, c. 148 (am. S.C. 1970-71-72, c. 63) (the "Act") which regulates the deductibility of support payments made by unmarried parents was discriminatory and offensive to subsection 15(1) of the Canadian Charter of Rights and Freedoms.

Bell, J.T.C.C. dismissed the appeal without written or recorded reasons.

Before us the applicant made two arguments. Firstly, he said that the Minister of National Revenue subjected him to discriminatory treatment by disallowing support payments made by him during the taxation year 1989 pursuant to a “separation agreement" which was confirmed by order of the Court. Secondly, he said that paragraph 60(c.1) of the Income Tax Act is discriminatory and offensive to subsection 15(1) of the Canadian Charter of Rights and Freedoms "in failing to provide common-law spouses with the same options to secure deductibility of maintenance payments as married spouses".

The relevant provisions of the Income Tax Act read:

60. Other deductions. There may be deducted in computing a taxpayer’s income for a taxation year such of the following amounts as are applicable:

(b) alimony payments.— an amount paid by the taxpayer in the year, pursuant to a decree, order or judgment of a competent tribunal or pursuant to a written agreement, as alimony or other allowance payable on a periodic basis for the maintenance of the recipient thereof, children of the marriage, or both the recipient and children of the marriage, if he was living apart from, and was separated pursuant to a divorce, judicial separation or written separation agreement from, his spouse or former spouse to whom he was required to make the payment at the time the payment was made and throughout the remainder of the year;

(c) maintenance payments.— an amount paid by the taxpayer in the year, pursuant to an order of a competent tribunal, as an allowance payable on a periodic basis for the maintenance of the recipient thereof, children of the recipient if, at the time the payment was made and throughout the remainder of the year, he was living apart from his spouse to whom he was required to make the payment;

(c.1) idem.— an amount paid by the taxpayer in the year, pursuant to an order made by a competent tribunal in accordance with the laws of a province, as an allowance payable on a periodic basis for the maintenance of the recipient thereof, children of the recipient, or both the recipient and children of the recipient if:

(i) the order was made

(A) after February 10, 1988, or

(B) before February 11, 1988 and the taxpayer and the recipient jointly elected before the end of the year to have this paragraph and paragraph 56(1)(c.1) apply with respect to the payment,

(ii) at the time the payment was made and throughout the remainder of the year, the taxpayer was living apart from the recipient, and

(iii) the taxpayer required to pay the amount is an individual of the opposite sex who

(A) before the date of the order cohabited with the recipient in a conjugal relationship, or

(B) is the natural parent of a child of the recipient;

In light of the jurisprudence of this Court in cases such as Symes v. Canada, [1991] 2 C.T.C. 1, 91 D.T.C. 5397 (F.C.A.); aff’d [1994] 1 C.T.C. 40, 94 D.T.C. 6001 (S.C.C.); Egan v. Canada (1993), 153 N.R. 161, 103 D.L.R. (4th) 336 (F.C.A.); Schachtschneider v. The Queen, [1993] 2 C.T.C. 178, 93 D.T.C. 5298 (F.C.A.), and the decision of the Tax Court of Canada in Weronski v. M.N.R., [1991] 2 C.T.C. 2431, 91 D.T.C. 1105, which deals with the same issues, we are all of the view that the applicant was not subjected to discriminatory treatment by the disallowance of the deduction and that paragraph 60(c.1) of the Income Tax Act is not offensive to the Canadian Charter of Rights and Freedoms.

The section 28 application will therefore be dismissed.

Application dismissed.