Valley v. R., [1997] 1 CTC 2618 (Informal Procedure)

Rowe D.J.T.C.C.: — The appellant appeals from an assessment of income tax for the 1994 taxation year. In computing income for that year, the appellant claimed a disability tax credit which the Minister of National Revenue disallowed.

The appellant testified he was born in 1919 and resides in New Westminster, British Columbia. He suffered an injury to the cartilage in his right knee while serving with the Canadian Army in 1943. He dealt with the problem himself and carried on until he was discharged in 1945. The knee bothered him for the next 44 years during which time he tore the cartilage over and over until, in 1987, there was a severe tear which required surgery to repair it in the late fall. Subsequent to the operation, fluid gathered in the knee which caused a lot of pain. He dealt with it by attending for physiotherapy, having the fluid drained on several occasions and by receiving injections of cortisone. In 1989, he moved from West Vancouver to New Westminster. During the period from 1989 to 1993 he walked with a severe limp. In 1993, he began to have pain in the lower back and he consulted Dr. Fairbank on several occasions. The pain persisted and he decided to consult another physician. He also consulted a chiropractor. He rented a device known as an upside-down board and exercised on it for one and one- half months but discovered it made the pain worse. At this point the pain extended from the back to the hip down the leg to the toes. He believed the problem was caused by sciatica and he consulted with another physician who agreed with that diagnosis. By March of 1994, he was on crutches and it was very difficult to get around. He spoke to a friend who was a physician in New Brunswick and received advice to take four aspirin a day for one month and then six aspirin a day for one month. This treatment brought relief but it also irritated his stomach. By the summer of 1995, the sciatica had improved and he could walk three or four blocks without using crutches or a cane. He claimed the disability tax credit for each of the taxation years 1991, 1992 and 1993 and it was allowed. He began using crutches in late fall, 1993 and spent a lot of time inside his apartment. He lived alone and would use the elevator in the apartment to descend to the parking area where his car was parked. Then, he would walk to his car and drive to his destination. He could walk to the store which was one or two blocks from his apartment and found that he was quite adept at using crutches. In 1994, there were times he did not use them and used a cane for support. However, about 80% of the time he did use crutches when walking as his progress was faster than when he used a cane. He estimated that he walked four times faster without crutches. In any event, it was always painful to walk. A questionnaire pertaining to his condition was completed by Dr. Warner in 1995 relating to the 1994 taxation year. Filed as Exhibit A-l was the Disability Tax Credit completed by Dr. Fairbank and Exhibit A-2 was the form completed by Dr. Warner.

In cross-examination, the appellant stated that he has been able to walk much better since the first few months in 1995. He recalled that the worst period was between January and the spring of 1994 during which time he could walk with the aid of crutches but “only when I had to”. By using crutches he was able to avoid putting weight on the knee, thereby eliminating most of the pain. However, he walked very slowly. By autumn of 1994, he had improved to the point where he used a cane when walking. He agreed that he had not earlier referred to back pain or sciatica as a problem occurring at the same time as the difficulty with the knee and termed that as an oversight on his part. However, a note written by Dr. Warner indicated he was also being treated for sciatica. Although he was able to walk faster using crutches instead of a cane, the crutches irritated his armpits. Throughout 1994, he was never able to walk without a cane or crutches. The condition became severe in the fall of 1993 and by the spring of 1994 it was at its worst.

Marie Dorosh testified that she lives in Surrey, British Columbia, is retired and has known the appellant for many years. In 1994, she observed him to always have crutches with him and she saw that he had swelling in the knee and he complained of pain.

Dr. William Fairbank testified he is retired but practised as a physician for 41 years. He first treated the appellant in 1990 and last saw him in 1993. He identified Exhibit A-1 as a document prepared by him wherein he diagnosed the appellant’s medical condition as being due to chronic os- teoarthritis of the right knee. He described the condition as a disease of “wear and tear” in that it is a result of many accumulated small injuries. In that sense it is a progressive disease and while the condition varies it sometimes requires an artificial knee joint to be installed. To that end, he referred the appellant to two orthopaedic surgeons, one of whom recommended surgery while the other did not. He also noted that, in November 1993, the appellant had complained about pain in the right hip. Dr. Fairbank stated that by August, 1993 the appellant’s knee had become worse and there was lots of crepitation in the joint. It was no better in September and in November he injected the appellant’s right knee with a drug which helped somewhat. On occasions when the appellant would attend at his office, Dr. Fairbank noted that he walked on crutches or with the aid of a cane. The removal of weight from the knee would relieve pain to some extent. Dr. Fairbank indicated that some young people can almost “race” on crutches but the appellant would be slowed down by using them even though he was otherwise in good health.

The relevant legislation is subsection 118.4(1) of the Income Tax Act as follows:

118.4(1) For the purposes of subsection 6(16), sections 118.2 and 118.3 and this subsection,

(a) an impairment is prolonged where it has lasted, or may reasonably be expected to last, for a continuous period of at least 12 months;

(b) an individual’s ability to perform a basic activity of daily living is markedly restricted only where all or substantially all of the time, even with therapy and the use of appropriate devices and medication, the individual is blind or is unable (or requires an inordinate amount of time) to perform a basic activity of daily living;

(c) a basic activity of daily living in relation to an individual means

(i) perceiving, thinking and remembering,

(ii) feeding and dressing oneself,

(iii) speaking so as to be understood, in a quiet setting, by another person familiar with the individual,

(iv) hearing so as to understand, in a quiet setting, another person familiar with the individual,

(v) eliminating (bowel or bladder functions), or

(vi) walking; and

(d) for greater certainty, no other activity, including working, housekeeping or a social or recreational activity, shall be considered as a basic activity of daily living.

The cases in this area are fact-driven and the result may vary, not only from year to year, but from person to person suffering from the same illness or condition since it depends on whether or not the strict wording of the relevant provisions have been satisfied by the evidence adduced in a particular appeal.

In the case of Murphy v. R., (sub nom. Murphy v. Canada) [1995] 1 C.T.C. 2857(D), 95 D.T.C. 415, the Honourable Judge Hamlyn considered the appeal of the taxpayer who suffered from chronic fatigue syndrome and myalgia. Judge Hamlyn found, at page 415 that:

AS a result of her disability, she is unemployable and cannot do housework, has problems preparing her meals, cannot work, cannot sit in a straight chair for more than an hour, cannot stand for more than ten minutes, has difficulty climbing stairs, and cannot do any physical type of activity such as biking or golf.

At page 416, Judge Hamlyn continued:

Paragraph 118.4(1)(b) defines markedly restricted to situations:

(b) ...where all or substantially all of the time, even with therapy and the use of appropriate devices and medication, the individual is ... unable (or requires an inordinate amount of time) to perform a basic activity of daily living.

[Emphasis added. I

Paragraph 118.4(1)(c) states that:

(c) a basic activity of daily living in relation to an individual means:

(i) perceiving, thinking and remembering,

(ii) feeding and dressing oneself,

(iii) speaking so as to be understood, in a quiet setting, by another person familiar with the individual,

(iv) hearing so as to understand, in a quiet setting, another person familiar with the individual,

(v) eliminating (bowel or bladder functions), or

(vi) walking.

In addition, paragraph 118.4(l)(d) states that, other than activities listed in (c):

(d) ... no other activity, including working, housekeeping or a social or a recreational activity, shall be considered as a basic activity of daily living.

This case, as presented, focused on the issue of walking. The question is whether having to constantly monitor her fatigue level in order to determine if she was able to walk even a block, and then the time taken to walk a block, being unable to keep up with others; having to stop and rest, and not being able to walk beyond the block for fear that the fatigue would result in serious physical illness was this time consumption an inordinate amount of time to perform this basic activity of daily living.

From The Oxford English Dictionary, Second Edition, Volume VII, of the Oxford University Press, 1989, “inordinate” means:

1. Not “ordered”; devoid of order or regularity; deviating from right or rule; irregular; disorderly; ...

2. Not kept within orderly limits, immoderate, intemperate, excessive ...

And from The Oxford English Dictionary, Second Edition, Volume I, Oxford University Press, 1989, “amount” means:

1. The sum total to which anything mounts up or reaches:

a. in quantity,

b. in number

2. The full value, effect, significance, or import ...

3. A quantity or sum viewed as a total.

JURISPRUDENCE

There is a very, very recent decision of the Federal Court of Appeal in relation to this type of case, and it is the decision in Jane D. Taylor and Her Majesty the Queen. And the file number is A-685-93. And it flows from a decision of this Court, file number 93-32(IT)I.

The Appellant at the Tax Court level was found not to be markedly restricted in her activities of daily living. The Federal Court of Appeal stated, in a rather brief and short judgment:

We are all of the view that the Tax Court Judge failed to apply the plain and ordinary language of section 118(4)1,a. of the Income Tax Act as it existed in 1988 which read:

markedly restricted in his activities of daily living. [1]

The Federal Court of Appeal goes on to say that if the learned trial judge had tested on the basis of the evidence before him, he would necessarily have concluded that the Appellant was entitled to the tax credit which she sought.

I have gone back to the Tax Court decision to find out what in fact was the affliction of the Appellant in that case. It was a case of multiple sclerosis, the factors involved were as follows: the Appellant had chronic fatigue; in the morning she determined what she could do that day. Some days her legs were heavy, her hands were curled, and then she would have other days she would be all right. But they were usually weak all the time, although some days they were far worse than others. She did drive a car, she did go out. She did prepare her own meals. She did not use public transportation. Her speech was slurred. Walking was difficult at the best of times and had to be on a flat surface. She had difficulty sleeping, a mild pain for which she took medication.

Essentially from that decision, and as I have pointed out to you, the Federal Court of Appeal says that the judge in that case would have found, if he had relied on the plain, ordinary meaning of the language of the section “markedly restricted in the daily activities”, that the Appellant would be markedly restricted in her daily activities.

I also conclude that this case is quite similar to the case of E.R. Conner v. The Queen [1994] E.T.C. 395, cited to me by counsel for the Appellant and I adopt Judge Sobier’s conclusion that the issue of walking is more than a simple black and white issue, which seems to be the position the Minister takes.

Walking must be tested as a basic activity of daily living. And what can this Appellant do in relation to walking? In this case before the Court, the Appellant cannot walk in any respect to keep up a normal pace. She must stop periodically and rest. She must monitor her fatigue level so that she does not injure herself physically and performs the activity with difficulty and in considerable pain and with fatigue. At best, when able to walk, she cannot go much further than a block.

The conclusion is therefore that the total amount of time she spends walking, when she is able to walk, is an inordinate amount of time, thus the effect of the impairment of the chronic fatigue syndrome and the myalgia on the Appellant’s ability to perform this basic activity of daily living of walking is markedly restricted. Therefore, the appeal does fall within the provisions of paragraph 118.4(1 )(b).

In the case of Sarkar v. R., (sub nom. Sarkar v. Canada) [1995] 2 C.T.C. 2750(D), an oral judgment of Judge Sarchuk, Tax Court of Canada, dealt with the disability tax credit entitlement of a taxpayer who suffered from myalgic encephalomyelitis, commonly known as chronic fatigue syndrome, Judge Sarchuk stated:

I note that paragraph (d) provides that “for greater certainty, no other activity, including working, housekeeping or a social or recreational activity, shall be considered as a basic activity of daily living”.

It is significant that for substantial periods of time or reasonable periods of time when she was feeling better, Linda Sarkar was quite capable of performing certain housekeeping duties. Thus the fact that she was not able to do so on other occasions is irrelevant since the section provides that it does not matter whether she is capable of performing those tasks. Housekeeping is not a basic activity of daily living.

What is of particular concern is paragraph (b) of subsection 118.4, which reads:

an individual’s ability to perform a basic activity of daily living is markedly restricted only where all or substantially all of the time, even with therapy and the use of appropriate devices and medication, the individual is blind or is unable (or requires an inordinate amount of time) to perform a basic activity of daily living;

All or substantially all” is not defined. However, “all” means everything. And when you say “all”, without modification, it simply means everything.

In terms of time, “all of the time” means exactly that. Reference to “all of the time” between twelve and four means every minute of that period of time. “Substantially”, which is used in that phrase as a modifier means, in substance, or substantially, or in the main. There is no mathematical formula by which one can determine what “substantially all” might be, but in my view it means almost all or essentially all of the time.

This, to my way of thinking, precludes a finding that intermittent bouts of illness, even causing a severe impairment on a sporadic basis, is sufficient for the purposes of this section.

The question in this case is whether the Appellant’s wife Linda and his daughter Roma meet the criteria stipulated in the subsections that I have just referred to. I note that subsection 118.4(1) was amended by 1990, chapter 49, subsection 91(1), applicable to the 1991 and subsequent taxation years. The current definition appears to be narrow and restrictive. However it is obvious that Parliament, as a matter of policy, intended to create a high threshold regarding the level of disability which must be met in order to qualify. That is the only way to read that section, particularly in view of the fact that it was not worded as strictly before and the legislators amended it to make it stricter. I cannot read it in any other fashion.

There is no doubt that the old injury sustained by the appellant during army service in 1943 worsened over the years to the point where it was causing him to suffer a great deal of pain in late 1993 and throughout 1994, with the peak of discomfort and effect on his mobility occurring in the spring of that year. There is no doubt that the condition was a physical impairment which was prolonged. It also affected his walking which is within the definition of a basic activity of daily living. The evidence satisfies me that throughout 1994 the appellant had to walk with crutches or a cane and that these devices slowed him down when walking to the store or to his car. The quantitative test that has to be met is whether or not it can be said that - even with the use of crutches and/or cane - it required an inordinate (italics are mine) amount of time to perform the activity of walking. It is relevant to put the activity of walking into context with his other activities in order to be able to conclude whether or not he was markedly restricted. By using crutches he was able to eliminate most of the pain and, while he travelled at one-quarter of his normal speed when walking two blocks, he was able to proceed at a steady, albeit slower, pace without excessive pain. He was able to walk from his apartment to the elevator and then from the basement landing to his vehicle and thereafter to travel with the aid of crutches or cane as he went about his daily living. I do not know what the evidence was before Judge Sobier, Tax Court of Canada in Conner v. R., (sub nom. Conner v. Canada) [1995] 1 C.T.C. 2371, 95 D.T.C. 198 which caused him to observe, at page 199:

To be able to walk 100 metres and have to stop and take the time that you take is an inordinate amount of time.

Taking all of the evidence into account and considering the strict requirements of the legislation and the jurisprudence on point, I conclude that while the painful condition suffered by the appellant throughout the 1994 taxation year was a prolonged physical impairment which affected his walking - a basic activity of daily living - and that it affected him all or substantially all of the time, it did not require an inordinate amount of time to walk and that the restriction under all of the circumstances was, therefore, not marked. The measurement of time and distance for walking is one which has not been quantified, probably for good reason. However, it seems to me that the overall circumstances of a person’s lifestyle during the year under appeal is relevant to the determination as to whether the ability to perform a certain basic activity of daily living is markedly restricted. In the event an individual was required — for medical reasons such as heart disease — to walk a certain distance each day and that activity required, overall on a daily basis, an amount of time that could be seen in total as being consistently inordinate then a different conclusion might well be reached by a trier of fact. I appreciate the appellant had a tough time of it in 1994 but the evidence does not satisfy the requirements of the legislation.

The appeal is hereby dismissed.

Appeal dismissed.