Gagné v. R., [1998] 3 CTC 2751

Tremblay T.C.J.:

Point at issue

According to the Notice of Appeal and Reply to the Notice of Appeal, the question is whether the Minister correctly concluded that the appellant and her ex-husband Florent Lemieux were each, for an equal number of months during the base year 1994, the parent who was primarily responsible for the care and education of their sons Guillaume and Manuel pursuant to ss. 122.6 to 122.64 of the Income Tax Act (“the Act”). The respondent took this decision as the parents were unable to agree.

Both parents allegedly took care of their children during the period from July 1995 to June 1996. The appellant maintained that during the said period she was solely responsible for the children’s expenses both at school and for recreation, insurance, clothing and so on. The respondent claimed the sum of $329.42 from the appellant.

Burden of proof

The appellant has the burden of showing that the determination of the child tax benefit by the respondent was incorrect. This burden of proof results from several judicial decisions, including a judgment of the Supreme Court of Canada in Johnston v. Minister of National Revenue. [1]

In the same judgment the Court held that the facts alleged by the respondent in support of his decision are also deemed to be true until proof to the contrary is shown. The facts assumed by the respondent in the instant case are set out in paragraph 6 of the Reply to the Notice of Appeal, which reads as follows:

[TRANSLATION]

6. In preparing the child tax benefit notice dated August 20, 1996 for the 1994 base year the Minister assumed a number of facts including the following:

• during the period at issue the appellant was separated from her ex-husband, Florent Lemieux; [admitted]

• the appellant and Florent Lemieux were the parents of Guillaume and Manuel, born on September 27, 1983 and July 27, 1987 respectively; [admitted]

• the appellant and her ex-husband had joint custody of their two sons; [admitted]

• responsibility for the care and education of the two sons was borne by both parents during the period from July 1995 to June 1996; [denied]

• as it was impossible for the parents to agree the Minister revised the child tax benefit for April, May and June 1996 to nil so far as the appellant was concerned, so that these benefits would be allocated for the 1994 base year for an equal number of months between the appellant and Florent Lemieux:

	Month	Appellant	Florent
			Lemieux
	July 1995	X
	August 1995	X
	September 1995	X
	October 1995	X
	November 1995		X
	December 1995		X
	January 1996		X
	February 1996	X
	March 1996	X
	April 1996		X
	May 1996		X
	June 1996		X
•	the sum of $329.42 was calculated as an overpayment of child
	tax benefits received by the appellant.

Facts in evidence

Following the foregoing admissions the evidence also consisted of the testimony of the appellant and of Muguette Nadeau, an appeals officer of the respondent.

The facts alleged in the appellant’s Notice of Appeal adequately summarize her testimony:

[TRANSLATION]

Montmagny

February 13, 1997

Revenue Canada

Taxation Centre

To whom it may concern:

I am challenging your decision on child tax benefits for 1994 as for this period, from July 1995 to January 1996, I was solely responsible for all the children’s expenses, namely school fees, recreation, insurance, clothing and so on and providing a suitcase with what was required for the week of custody at my exhusband’s home.

Strangely, when he received the whole allowances from January to March 1996 there was no further mention of a suitcase: this was a case of double standard. He took the money but did nothing for them. I had to buy sneakers for the little one in this period because frankly ... he looked terrible. The soles were completely gone.

When I was given the allowances in March I divided the expenses in making the calculation you will find enclosed. You will note that he had already received half of the whole amount he was still claiming. It is too much. I would add that this was only a small amount compare to what it cost me (invoice in support), but I did not want to “upset” him. In short, I am still paying for all recreational expenses such as roller skates, skateboards and snowboards, which the children use daily both at my home and his, and I have never asked him for anything in this respect.

Furthermore, since he has been receiving half of the benefit he has never repaid me the life insurance portion or the medical and dental insurance portion. Guillaume, for whom he is receiving benefits, lost his coat when he was in his charge. Who had to buy him another one? His sneakers were completely ruined. Who bought him a new pair? - and toques and mittens? I am always the one who has to see to this. I am sick and tired of this but if I did not do it, who would? - and most importantly, who would suffer? - always the children. I find this situation very unfair and the children will confirm what I am saying if necessary. Guillaume was really not happy to have been “selected” to be in his father’s custody ... he also objected to the injustice.

In her testimony Muguette Nadeau, an appeals officer, maintained that she took her decision in accordance with the factors laid down in s. 6302 of the Income Tax Regulations (“the Regulations”), which read as follows:

6302 For the purposes of paragraph (h) of the definition “eligible individual” in section 122.6 of the Act, the following factors are to be considered in determining what constitutes care and upbringing of a qualified dependant:

(a) the supervision of the daily activities and needs of the qualified dependant;

(b) the maintenance of a secure environment in which the qualified dependant resides;

(c) the arrangement of, and transportation to, medical care at regular intervals and as required for the qualified dependant;

(d) the arrangement of, participation in, and transportation to, educational, recreational, athletic or similar activities in respect of the qualified dependant;

(e) the attendance to the needs of the qualified dependant when the qualified dependant is ill or otherwise in need of the attendance of another person;

(f) the attendance to the hygienic needs of the qualified dependant on a regular basis;

(g) the provision, generally, of guidance and companionship to the qualified dependant; and

(h) the existence of a court order in respect of the qualified dependant that is valid in the jurisdiction in which the qualified dependant resides.

Ms. Nadeau said she did not have to take prior agreements between the spouses into account. She took account of the fact that the appellant’s net income was higher than that of her husband when she disallowed the working income supplement.

Furthermore, the money paid by each spouse is not among the criteria, except for disallowing the working income supplement as in the instant case where the appellant is concerned, according to the child tax benefit notice dated August 20, 1996 sent to the appellant by the respondent.

The respondent filed a group of invoices showing purchases made for the children (Exhibit 1-1).

The appellant maintained that she had not seen the items supposedly bought for the children that are mentioned in the invoices in Exhibit 1-1.

The appellant’s husband is a cabinetmaker. The appellant is a special education teacher.

The husband did not testify to contradict the appellant’s testimony.

Based on the evidence as a whole the Court considers that the appellant’s appeal should be allowed so that she will not have to repay the sum of $329.42.

Conclusion

The appeal is allowed.

Appeal allowed.