Carolyn F Halliday v. Minister of National Revenue, [1979] CTC 2852, 79 DTC 715

Delmer E Taylor:—This is an appeal heard in St John’s, Newfoundland, on July 11,1979, against an income tax assessment in which the Minister of National Revenue disallowed the amount of $390 claimed by the appellant as a deduction for a wholy dependent child for the year 1976.

The appellant’s position is that a fetus is an unborn child, thereby a child and, for purposes of the deduction sought, qualified under paragraph 109(1)(d) of the Act. The respondent gave two arguments—denying that a fetus is a child, and also stressing that the qualification in the Act “wholly dependent upon” must be met. The complete written “Statement of Facts and Reasons” submitted by the appellant is reproduced, as well as written summary provided by the respondent:

For the appellant:

By the notice of assessment dated November 29,1977 my total personal exemptions were adjusted to $2,090, a reduction of $390 which was not explained in the notice of assessment but appears to be the elimination of the exemption for a wholly dependant child, my son Andrew A, born May 20, 1977.

This exemption was claimed pursuant to sub-paragraphs 109(1)(d)(i) and 109(1)(d)(iv) of the Income Tax Act. Sub-paragraph 109(1)(d)(i) states:

“(1) For the purpose of computing the taxable income of an individual for a taxation year, there may be deducted from his income for the year such of the following amounts as are applicable:... (d) for each child or grandchild of the individual who, during the year, was wholly dependant upon him for support and was (i) under 21 years of age, . .

Sub-paragraph 109(1)(d)(iv) specifies the amount of deduction.

Since the Income Tax Act does contain a definition of the word “child” (subsection 252(1) specifies certain persons to be a child of the taxpayer, but does not deal with the definition of a child), the word must be considered to take its ordinary meaning.

The Oxford Illustrated Dictionary defines child as:

“Unborn or newly born human being; . .

Webster’s Third New International Dictionary defines child as:

“1a: An unborn or recently born human being . . .’

These definitions clearly do not exclude from the meaning of “child” an unborn child and imply that a child’s existence begins at or soon after the time of conception and not at the time of birth. The inclusion of an unborn child in the meaning of child is illustrated in the expression ‘a woman with child’.

The expression ‘‘during the years”, as it is used in section 109, means ‘at any time in the year,’ rather than ‘throughout the whole year’ and this meaning is confirmed by Revenue Canada, Taxation in its interpretation bulletin IT-191.

My child, who was born on May 20, 1977, was conceived on or about August 20, 1976 and from that time, for a period of approximately four months during 1976, was wholly dependant upon me for support in the financial, physiological and physical senses. The approximate date of conception has been confirmed by medical opinions.

During 1976 the net income of my child Andrew A was nil.

Based on the foregoing I contend that I should be entitled to an exemption under section 109 of $390 in computing my taxable income for the 1976 taxation year and for this reason I object to the assessment issued November 29, 1977.

For the respondent:

6. Subsection 109(1)(d) of the Income Tax Act is a provision which provides a deduction from income tax and therefore the provision ought to be strictly construed. The onus is clearly upon the appellant to show that he is entitled to the deduction sought. Dame Mary Why lie and Vir v City of Montreal (1885-86) 12 SCR 384; The Queen v A Scheller, [1975] CTC 601; 75 DTC 5406.

7. In order to take advantage of the deduction from income tax in respect of the facts at issue, the following conditions must be met:

(i) there must be a child of the individual appellant;

(ii) that child was, during the year, wholly dependant upon the individual appellant for support;

8. It is submitted that Andrew Halliday, who was not, in fact, born until the 1977 taxation year, was not a child of the taxpayer for the 1976 taxation year within the meaning of paragraph 109(1)(d) of the Income Tax Act.

9. The word “child” is not defined in the Income Tax Act. Although the words of a statute are normally to be construed in their ordinary meaning in the absence of a Statutory definition, due regard must be had to their subject matter and object and the circumstances with reference to which they are used, and they should be construed in the light of their context rather than in what may be their strict etymological sense or their popular meaning apart from that contest. Halsbury’s Laws of England, 3rd ed vol 36 at 394; Highway Sawmills v MNR, [1966] SCR 384; [1966] CTC 150; 66 DTC 5116.

10. Thus a statute should be construed as a whole so as, so far as possible, to avoid any inconsistency or repugnancy either within the section to be construed or as between that section and other parts of the statute. As a general rule a word is to be considered as used throughout a statute in the same sense. Halsbury’s Laws of England, 3rd ed vol 36 at 395-396; Grey v Pearson (1857) 10 ER 1216 at 1234; Kirkpatrick and Marougham (1927) 60 OLR 495.

11. It is submitted that on a proper examination of subsection 109 as a whole, it becomes evident that the word “child” in paragraph 109(1)(d) cannot include an unborn child. Specifically, subsection 109(3) provides:

For the purpose of the deduction for a child under paragraph (1)(d), it shall be assumed, unless the contrary is established, that an illegitimate child was wholly dependant on this mother and that any other child was wholly dependant on his father.

To include in the meaning of the word “child” an unborn child, would provide an absurd result on the facts of this case and in the application of subsection 109(3). See also Section 252.

12. It is submitted that on an examination of other section of the Income Tax Act where the word ‘child’ appears it becomes further evident that the Act envisions a child actually born, that is, a child having an existence apart from its mother. See: Sections 63; Subsections 70(9)(i. 1 )(10); Subsections 56(5)(6)(7)(8); Subsection 73(3); ITAR 26 (18)(19)(20).

13. There do not appear to be any Canadian judgments which determine, specifically for the purposes of the Income Tax Act, whether the word “child” includes unborn child. However the English courts in the case of Jackson v Voss (1923) 2 KB 375 have been called upon to interpret the term “a child living” within the English Finance Act, 1920. The taxpayer had contended in that case that the term “child living” included a child en ventre sa mère who was subsequently born alive. Mr Justice Rowlatt rejected this contention and stated at 360-61:

By the Finance Act, 1920, what was intended was that the size of a man’s family—the number of his children—should be counted on a particular date and an allowance made to him accordingly. When, in effect, the section says that, I cannot believe that it was ever intended that the man claiming the allowance could, on a subsequent date, go back and count as actually living on the first date children who were not then born. The section is meant to protect a man with a family, and it has done so in the way I have indicated. It is said for the respondent that a man incurs expense before the child is born. That is true, but admittedly he can get no allowance if the child is born on such a date in the year that it could not have been en ventre sa mère at the commencement of the year of assessment—namely on April 4.

.. This case is in a different region from those in which the expression ‘child living’ has been construed as including a child en ventre sa mere.

It is respectifully submitted that the reasoning of Mr Justice Rowlatt applies in the case at bar so as to preclude from the meaning of the word ‘child’ in paragraph 109(1)(d) of the Income Tax Act an unborn child. Jackson v Voss (1923) 2 KB 357.

14. In the alternative, it is submitted that an unborn child is not “wholly dependant for support” on the appellant within the meaning of paragraph 109(1 )(d).

15. The Tax Appeal Board in H G Murdoch v MNR, 39 Tax ABC 97; 65 DTC 541 has held that the word “dependant” means financially dependant and the word “support” means the furnishing of material benefits of the type which can be purchased, with the result that on the facts of this case Andrew Halliday was not wholly dependant on his mother before his birth within the meaning of paragraph 109(1)(d) of the Income Tax Act.

I am impressed by the sincerity and sensitivity with which the two parties have approached this difficult subject. However, I doubt that the general definitions provided by the appellant would be sufficient to establish the case for the taxpayer, and the legal analysis provided by counsel for the Minister is persuasive indeed. That analysis, made by the Minister’s counsel, by implication fits the “child” within the definition of “person” under subsection 248(1) of the Act, but excludes therefrom the “fetus”. The Tax Review Board may not be the most appropriate forum within which to make a determination on the particular point which arises therefrom, but in my view it is a precise question of law, not determinable under dictionary definitions alone.

In dismissing the taxpayer’s appeal, the board is careful to point out that it is not deciding that a “fetus” is not a “person” but merely deciding that the legal basis upon which an affirmative decision on that point could be made has not been provided in this appeal.

The appeal is dismissed.

Appeal dismissed.