Judge
Flanigan
(orally:
September
25,
1974):—This
is
an
appeal
by
Emil
Schilder
against:
the
reassessment
of
the
Minister
of
National
Revenue
for
the
1972
taxation
year.
It
involves
section
62
of
the
1972
legislation
which,
for
the
first
time,
permits
a
taxpayer
to
deduct
from
his
income
expenses
incurred
where
he
has,
at
any
time
after
the
1971
taxation
year,
ceased
to
carry
on
a
business
or
be
employed
in
one
location
and
has
moved
to
another
location
within
certain
minimal
mileage
restrictions.
\;
.
.
,
;
lt
is
admitted
by
counsel
for
the
Minister
that
the
expenses
claimed
‘are
proper
expenses,
with
perhaps
some
doubt
as
to
the
eligibility
of
travelling
expenses
for
the
signing
of
documents,
but
he
contends
that
the
move
in
question
took
place
prior
to
January
1,
1972
and
therefore,
by
section
27
of
the
Income
Tax
Application
Rules,
1971,
the
appellant
is
not
entitled
to
take
advantage
of
the
provisions
of
this
deducting
section.
The
facts
are
really
not
in
dispute.
Prior
to
the
summer
of
1971
the
appellant
was
a
self-employed
management
consultant
living
with
his
wife
and
family
in
King
Township
in
the
Toronto
area
in
a
home
in
which
he
had
resided
since
about
1966.
I
believe
he
had
purchased
the
lot
in
1965.
He
says
the
house
was
purchased
in
his
wife’s
name
for
business
reasons.
His
wife
was
unemployed
and
had
no
financial
means,
and
all
payments
in
connection
with
the
King
Township
house
were
made
by
the
appellant.
There
is
no
question
in
law
that
there
was
a
resulting
trust
in
favour
of
the
wife
by
putting
her
name
on
the
deed
and
registering
her
as
the
owner;
but
I
think
it
is
also
well-established
law,
even
well-established
income
tax
law,
that
the
necessities
of
life
would
include
the
payment
of
the
mortgage
by
the
husband
on
behalf
of
the
wife
in
the
course
of
maintaining
the
family
residence.
Apparently
in
the
summer
of
1971
the
appellant
received
an
offer
from
the
federal
Bureau
of
Management
Consulting
and
he
accepted
employment
with
it,
being
put
on
probation
for
a
period
of
one
year.
In
or
about
April
of
1972
he
was
offered
a
permanent
position
and
accepted
it.
Prior
to
moving
to
Ottawa
in
the
summer
of
1971
he
listed
the
King
Township
property
for
sale
with
a
real
estate
agency
for
a
period
of
two
months,
subsequently
trying
other
means
of
selling
it,
but
he
was
not
able
to
obtain
an
offer
equal
to
what
he
felt
was
a
proper
price
in
the
market
at
that
time
for
his
residence.
He
subsequently
relisted
the
property
with
the
original
real
estate
agents
and
sold
it
in
March
of
1972
for
less
than
the
price
at
which
it
was
listed.
By
this
time,
as
I
have
said,
the
appellant
had
moved
his
wife
and
family
to
Ottawa
in
the
summer
of
1971,
where
they
purchased
a
$40,000
house,
I
believe
with
funds
supplied
by
friends,
and
he
probably
felt
that
it
was
expedient
to
accept
the
offer
for
the
King
Township
residence
and
clear
off
his
obligations
in
Ottawa.
The
question
before
me
is
whether
he
ceased
to
carry
on
business
in
King
Township
when
he
went
to
Ottawa
in
1971,
or
in
1972
when
he
accepted
what
he
described
as
permanent
employment
with
the
Government
of
Canada.
If
his
move
was
in
1971,
then,
of
course,
the
deducting
section
62
of
the
1972
legislation
would
not
apply
because
there
was
no
corresponding
section
in
the
pre-1972
Act.
As
I
have
said,
he
was
not
employed,
so
there
is
a
question
as
to
whether
or
not
he
ceased
to
carry
on
his
management
consulting
business.
To
determine
this
one
must
consider,
as
I
have
already
mentioned,
some
of
the
facts.
He
severed
all
connections
with
the
King
Township
residence
so
far
as
his
family
was
concerned.
The
children
were
enrolled
in
school
in
Ottawa
in
September
of
1971.
His
wife
became
the
registered
owner
of
the
house
in
Ottawa
in
1971.
He
worked
full-time
for
the
Government
in
1971,
although
he
was
not
restricted
by
his
terms
of
employment
from
carrying
on
occasionally,
or
when
time
permitted,
his
self-employment
as
a
management
or
business
consultant,
which
he
said
he
did
to
some
small
degree,
keeping,
as
he
described
it,
his
irons
in
the
fire
in
case
he
decided
to
return
to
private
business.
I
think
one
must
look
at
the
entire
section
to
determine
whether
or
not
in
this
case
the
appellant
is
entitled
to
the
deduction.
The
purport
of
the
section
as
a
whole
is,
in
my
view
at
least,
to
allow
people
to
accept
employment
in
various
parts
of
this
country
which
might
otherwise
not
be
available
to
them
because
of
the
prohibitive
cost
of
moving.
The
statute,
in
particular
subsection
62(1),
provides
in
part:
“Where
a
taxpayer
has.
.
.
ceased
to
carry
on
business
.
.
.
and
by
reason
thereof
has
moved
from
the
residence
in
Canada
at
which,
before
the
move,
he
ordinarily
resided
on
ordinary
working
days
...”—which
is
referred
to
as
“the
old
residence”—“to
a
residence
in
Canada
at
which,
after
the
move,
he
ordinarily
so
resided
.
.
.”—whioh
is
referred
to
as
“the
new
residence”.
There
is
no
question
whatsoever
on
the
evidence
before
me
that
from
mid-June
or
July,
or
at
least
during:
the
summer
of
1971,
this
appellant,
his
wife
and
children
were
ordinarily
resident
on
ordinary
working
days
in
the
City
of
Ottawa.
I
therefore
can
come
to
no
other
conclusion
than
that
the
move
contemplated
by
section
62
of
the
Act
was
made
in
1971
and
not
in
1972.
It
is
perhaps
not
part
of
the
ratio
of
this
decision,
but
it
seems
to
me
that
had
he
decided
that
he
did
not
wish
to
remain
in
the
employ
of
the
Government
of
Canada
in
1972
he
could
have
returned
to
his
King
Township
residence
and
had
the
advantage
of
section
62
because
he
would
again
have
been
changing
his
employment
or
ceasing
to
carry
on
business
in
this
City.
Also,
in
my
view,
the
accounting
principle
of
matching
income
and
expenses
only
applies
if
he
is
under
the
1972
Act
for
this
move.
I
make
this
finding
without
making
any
finding
on
the
question
of
whether
the
registration
of
the
title
in
the
name
of
the
wife
or
the
fact
that
the
house
was
rented
for
a
period
of
time
would
affect
the
decision
had
I
decided
that
the
move
had
taken
place
in
1972.
Having
decided
that
the
move
was
effectively
completed
in
1971,
I
find
it
unnecessary
to
rule
on
the
question
of
the
effect
of
the
ownership
of
the
house
by
the
wife.
The
appeal
will
therefore
be
dismissed.
Appeal
dismissed.
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