Roland
St-Onge
(orally):—The
appeal
of
Mr
James
Sterling
Stewart
came
before
me
on
September
14,
1982,
in
the
City
of
Ottawa,
Province
of
Ontario,
and
the
issue
is
whether
the
appellant
is
allowed
to
deduct
$150
paid
to
the
Appraisal
Institute
of
Canada
in
his
1980
taxation
year.
The
facts
and
reasons
for
appealing
are
well
set
forth
in
Paragraphs
1,
2,
3,
5,
6
and
7
of
the
notice
of
appeal
which
read
as
follows:
Statement
of
Facts
1.
The
Appellant
is
employed
as
Chief
Appraiser
with
the
Department
of
National
Revenue
(Taxation).
2.
During
the
year
1980,
the
Appellant
paid
to
the
Appraisal
Institute
of
Canada
the
sum
of
$150
as
annual
membership
fees.
3.
When
filing
his
1980
income
tax
return,
the
Appellant
claimed
the
$150
paid
to
the
Appraisal
Institute
of
Canada
as
annual
professional
membership
dues
as
described
in
subparagraph
8(1
)(i)(i)
of
the
Income
Tax
Act.
The
Appellant
did
not
claim
any
union
dues.
5.
It
is
submitted
that:
(a)
the
practice
of
appraising
real
estate
is
a
profession;
(b)
in
order
to
carry
out
his
duties
as
Chief
Appraiser,
it
is
necessary
for
the
Appellant
to
maintain
the
professional
status
of
a
real
estate
appraiser;
(c)
in
order
to
maintain
a
professional
status
in
the
field
of
real
estate
appraisal,
it
is
necessary
to
belong
to
some
association
of
real
estate
appraisers;
(d)
there
are
several
associations
available
to
real
estate
appraisers
in
Canada,
e.g.
the
Appraisal
Institute
of
Canada,
The
American
Institute
of
Real
Estate
Appraisers,
Corporation
of
Chartered
Appraisers,
the
Royal
Institution
of
Chartered
Surveyors;
(e)
to
be
considered
a
professional
appraiser
in
any
practical
sense,
it
is
necessary
to
belong
to
one
or
more
of
the
above
or
similar
organizations;
(f)
the
Appraisal
Institute
of
Canada,
being
the
only
national
professional
appraisal
organization,
is
the
most
logical
one
in
which
to
maintain
membership;
(g)
the
profession
of
real
estate
appraising
is
recognized
by
statute
in
several
jurisdictions,
eg
(i)
in
the
Province
of
Quebec
by
the
Professional
Code,
R.S.Q.
Chapter
26,
Article
37(j);
(ii)
in
the
State
of
Nebraska
by
the
Nebraska
Real
Estate
Appraiser
License
Act;
(iii)
in
the
United
Kingdom
by
Royal
Charter
granted
by
the
Sovereign
to
the
Royal
Institution
of
Chartered
Surveyors;
(h)
the
word
“statute”
is
not
defined
in
the
Income
Tax
Act.
It
therefore
takes
on
its
ordinary
meaning.
According
to
the
Oxford
Dictionary,
“statute”
means
(a)
a
law
or
decree
made
by
a
sovereign
or
a
legislative
authority
.
.
.
(b)
applied
to
an
ordinance
or
decree
of
God,
a
deity,
fate,
etc.
.
.
.
(c)
a
law
made
by
a
guild
or
corporation
for
the
conduct
of
its
members;
a
by-law
of
a
borough,
a
provision
in
a
municipal
charter
..
.“
(i)
the
Appraisal
Institute
of
Canada,
by
its
By-laws,
has
established
a
“Code
of
Ethics
and
Standards
of
Professional
Conduct
and
Practice”.
These
By-laws
meet
the
definition
of
“statute”
as
set
out
in
(C)
of
the
Oxford
definition.
6.
The
above
establishes
that
real
estate
appraising
is
a
profession
recognized
by
Statute
and,
in
order
to
maintain
the
professional
status
in
any
practical
sense,
it
is
necessary
to
belong
to
some
organization
such
as
the
Appraisal
Institute
of
Canada.
7.
The
payment
of
annual
membership
fees
to
the
Appraisal
Institute
of
Canada
is.
therefore,
an
allowable
deduction
under
subparagraph
8(1
)(i)(i)
of
the
Income
Tax
Act.
ct.
The
respondent
disallowed
the
deduction
for
the
following
reasons,
which
are
mentioned
in
subparagraphs
5(a),
(b)
and
(c)
of
the
reply
to
notice
of
appeal
as
follows:
5.
In
reassessing
the
Appellant
in
respect
of
his
1980
taxation
year
and
thereby
disallowing
the
deduction
of
$150
paid
to
the
Appraisal
Institute
of
Canada,
the
Respondent
proceeded
on
the
basis
that
the
amount
so
paid
was
not
one
which
“.
.
.
Was
necessary
to
maintain
a
professional
status
recognized
by
statute”
since:
(a)
the
Province
of
Ontario
does
not
have
legislation
which
recognizes
a
real
estate
appraiser
as
having
a
professional
status,
(b)
the
payment
made
was
not
necessary
to
maintain
a
professional
status,
and
(c)
the
payment
of
such
amount
was
not
one
required
to
be
made
to
maintain
the
Appellant’s
employment
with
the
Department
of
Nation
Revenue
—
Taxation.
The
relevant
section
reads
as
follows:
DUES
AND
OTHER
EXPENSES
OF
PERFORMING
DUTIES
8(1)(1)
(i)
amounts
paid
by
the
taxpayer
in
the
year
as
(i)
annual
professional
membership
dues
the
payment
of
which
was
necessary
to
maintain
a
professional
status
recognized
by
statute,
The
evidence
has
revealed
that:
1.
The
appellant
does
not
belong
to
or
is
not
a
member
of
La
Corporation
Professionelle
des
Evaluateurs
Agréés
du
Quebec.
2.
The
Province
of
Ontario
does
not
have
legislation
which
recognizes
a
real
estate
appraiser
as
having
professional
status.
Consequently,
the
appellant,
by
being
a
resident
of
Ontario
and
not
being
a
member
of
any
Corporation
which
allows
a
real
estate
appraiser
to
have
professional
status,
cannot
utilize
subparagraph
8(1
)(i)(i)
of
the
Income
Tax
Act,
SC
1970-71-72,
c
63
as
amended,
to
deduct
$150
that
he
paid
to
the
Appraisal
Institute
of
Canada.
The
appellant
is
not
recognized
as
a
professional
appraiser
by
statute
of
a
province
of
this
country
or
by
the
Government
of
Canada.
Subparagraph
8(1
)(i)(i)
of
the
Act
exacts
that
such
must
be
the
case
in
order
for
a
taxpayer
to
get
a
deduction.
An
exempting
section
must
be
interpreted
restrictively.
In
order
to
get
a
deduction
a
taxpayer
must
fit
squarely
within
the
four
corners
of
the
section.
In
light
of
the
decision
in
The
Queen
v
Robert
B
Swingle,
[1977]
CTC
448;
77
DTC
5301,
and
following
what
I
have
just
mentioned,
I
have
to
dismiss
the
appeal.
The
appeal
is
dismissed.
Appeal
dismissed.
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