Roland
St-Onge
[TRANSLATION]:—The
appeal
of
Mr
André
Thibault
and
the
case
of
Mrs
Madeleine
Brassard
Thibault
came
before
me
on
June
29,
1979
at
the
city
of
Montreal,
Quebec,
following
my
decision
dated
January
24,
1979
in
which
I
ordered
that
Mrs
Madeleine
Brassard
Thibault
be
impleaded
in
the
appeal
of
Mr
André
Thibault,
that
is,
appeal
No
78-176
of
the
Tax
Review
Board
respecting
the
1973,
1974
and
1975
taxation
years.
In
the
present
case
the
issue
is
whether
the
payments
made
by
the
appellant
to
the
mortgage
creditors
during
the
1973,
197^
and
1975
taxation
years
are
amounts
deductible
by
him
or
taxable
as
income
for
Mrs
Madeleine
Brassard
Thibault.
The
facts
of
this
appeal
are
set
out
clearly
in
the
following
paragraphs
of
the
reply
to
the
notice
of
appeal:
2.
For
the
1973,
1974
and
1975
taxation
years
the
appellant
is
seeking
to
deduct
from
his
income
the
sums
of
$4,250,
$10,200
and
$10,200
respectively
as
alimony
paid
to
his
wife
during
the
said
taxation
years;
3.
In
notices
of
reassessment
dated
April
1
1977,
the
respondent
disallowed
the
deduction
of
$1,000
for
1973,
$2,400
for
1974
and
$2,400
for
1975;
4.
In
establishing
the
reassessments
the
respondent
relied
on
the
following
presumptions
of
fact,
inter
alia:
(a)
During
the
1973,
1974
and
1975
taxation
years
the
appellant
had
to
pay
his
wife
the
sum
of
$850
per
month
as
alimony
under
an
agreement
dated
August
6,
1973
and
a
judgment
of
separation
between
the
spouses
dated
February
18,
1974;
(b)
During
the
period
from
August
6,
1973
to
December
31,
1975
the
appellant
paid
his
wife
the
sums
of
$3,250,
$7,800
and
$7,800
for
the
1973,
1974
and
1975
taxation
years
respectively,
that
is,
$650
per
month;
(c)
The
appellant
paid
sums
of
$201.90
per
month
directly
to
the
mortgage
creditors
during
the
period
referred
to
in
paragraph
(b);
(d)
The
appellant’s
wife
never
agreed
to
monthly
payments
of
$201.90
being
deducted
from
her
alimony
to
pay
the
mortgage
creditors;
(e)
Neither
the
agreement
nor
the
judgment
referred
to
in
paragraph
(a)
contained
provisions
respecting
the
payment
of
the
mortgage
debt.
Mr
Thibault
testified
that
following
telephone
conversations
with
his
wife
he
regarded
her
as
his
tenant
and
deducted
a
sum
of
$200
per
month
from
the
alimony
for
her
rent.
On
the
other
hand,
in
reply
to
a
question
by
the
Board,
he
stated
under
oath
that
he
could
not
say
his
wife
had
authorized
him
to
proceed
in
this
manner.
Mrs
Thibault
also
gave
evidence
and
stated
under
oath
that
she
had
never
authorized
her
husband
to
deduct
$200
and
pay
these
amounts
to
the
mortgage
creditors.
In
Attorney
General
of
Canada
v
James
C
Weaver
and
Freda
J
Weaver,
[1975]
CTC
646;
75
DTC
5462,
the
Federal
Court
of
Appeal
gave
the
following
definition,
and
I
quote:
An
allowance
is,
in
our
view,
a
limited
predetermined
sum
of
money
paid
to
enable
the
recipient
to
provide
for
certain
kinds
of
expenses;
its
amount
is
determined
in
advance
and,
once
paid,
it
is
at
the
complete
disposition
of
the
recipient
who
is
not
required
to
account
for
it.
A
payment
in
satisfaction
of
an
obligation
to
indemnify
or
reimburse
someone
or
to
defray
his
or
her
actual
expenses
is
not
an
allowance;
it
is
not
a
sum
allowed
to
the
recipient
to
be
applied
in
his
or
her
discretion
to
certain
kinds
of
expenses.
The
evidence
indicated
that
the
appellant’s
wife
never
consented
to
monthly
payments
of
$201.90
being
deducted
from
her
alimony
to
pay
the
mortgage
creditors;
moreover,
neither
the
agreement
between
them
nor
the
separation
judgment
dated
February
18,
1974
contained
such
provisions
regarding
payment
of
the
mortgage
debt.
Subsection
60(1)
of
the
Income
Tax
Act
does
not
apply
to
the
present
case
since
no
agreement
has
been
made
since
May
6,
1974.
For
these
reasons
the
appeal
of
Mr
André
Thibault
is
dismissed;
it
is
also
decided
that
the
amounts
paid
to
the
mortgage
creditors
should
not
be
added
to
the
income
of
Mrs
Madeleine
Brassard
Thibault.
Appeal
dismissed.
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