A
W
Prociuk
(orally):—This
appeal
in
the
Estate
of
Alfred
John
Ferguson
Roberts
was
instituted
by
Messrs
Norman
Lindsay
Ross,
Leslie
Edwin
Pope,
T
Irvine
Cormack,
C
Peter
V
Forrest,
and
Robert
T
Hoard,
all
of
whom
are
parties,
as
was
the
deceased,
to
a
certain
buy-sell
agreement
dated
November
15,
1968.
They
were
all
major
shareholders
in
Ker
&
Stephenson
Limited,
a
company
incorporated
under
the
laws
of
British
Columbia,
having
its
registered
office
in
Victoria,
British
Columbia.
The
said
agreement
reads
as
follows:
Whereas,
the
shareholders
are
the
major
shareholders
in
Ker
&
Stephenson
Limited,
a
company
duly
incorporated
under
the
laws
of
the
Province
of
British
Columbia,
and
having
its
registered
office
at
680
Broughton
Street,
in
the
City
of
Victoria,
in
the
Province
of
British
Columbia,
(hereinafter
referred
to
as
the
“Company”);
And
whereas,
it
is
the
desire
of
the
shareholders
that
upon
the
death
of
any
of
them,
the
shares
of
common
stock
of
the
company
which
are
owned
by
such
deceased
shareholder
at
the
time
of
his
death,
shall
be
purchased
by
the
surviving
shareholders,
except
the
said
Alfred
John
Ferguson
Roberts;
And
whereas,
the
shareholders
have
requested
the
secretary
for
the
time
being
of
Ker
&
Stephenson
Limited,
presently
Robert
T.
Hoard,
to
act
as
trustee
for
the
purpose
of
carrying
out
the
arrangements
contained
in
this
agreement
as
hereinafter
mentioned;
Now
therefore
this
indenture
witnesseth
that
in
consideration
of
the
premises
and
the
mutual
agreements
and
covenants
herein
contained,
it
is
hereby
declared,
agreed
and
covenanted
by
and
between
the
shareholders
as
follows:—
1.
Upon
the
death
of
any
shareholder:
(a)
The
shares
of
the
said
company
owned
by
such
deceased
shareholder
shall
be
valued
in
accordance
with
the
assessment
thereof
by
the
Estate
Tax
Department
of
the
Department
of
National
Revenue,
Government
of
Canada.
(b)
The
personal
representative
of
the
deceased
shareholder
shall
sell
and
the
surviving
shareholders,
except
the
said
Alfred
John
Ferguson
Roberts,
shall
purchase
the
shares
of
the
said
company
owned
by
such
deceased
shareholder
at
the
time
of
his
death,
in
proportion
to
their
shareholdings
among
each
other,
excepting
thereout
shares
owned
by
the
said
Alfred
John
Ferguson
Roberts,
the
purchase
price
to
be
the
value
of
the
shares
determined
in
accordance
with
paragraph
1
(a)
hereof.
(c)
The
surviving
shareholders
shall
pay
the
purchase
price
of
the
said
shares
to
the
personal
representative
of
the
deceased
shareholder,
as
follows:
(i)
A
sum
equivalent
to
one-third
(%)
of
the
value
thereof
shall
be
payable
to
the
personal
representative
of
the
deceased
shareholder,
in
cash,
within
six
(6)
months
following
the
death
of
the
deceased
shareholder,
provided
however,
that
in
the
event
the
Estate
Tax
assessment
has
not
been
made
and
accepted
by
the
personal
representative
of
the
deceased
shareholder,
within
the
said
six
(6)
months,
the
required
one-third
(‘/3)
payment
shall
be
made
upon
acceptance
of
such
assessment
by
the
personal
representatives.
(ii)
The
balance
of
the
purchase
price
of
the
said
shares
shall
be
paid
to
the
trustee
in
equal
monthly
payments
amortized
over
a
three
(3)
year
term,
together
with
interest
at
the
rate
of
five
per
cent
(5%)
per
annum,
the
first
of
such
equal
monthly
payments
to
become
due
and
payable
one
(1)
year
after
payment
made
in
the
last
preceding
paragraph
hereof;
Provided
however,
the
entire
balance
owing
by
the
surviving
shareholders
shall
immediately
become
due
and
payable
on
the
happening
of
any
of
the
following
events,
that
is
to
say:
(a)
Upon
any
act
of
bankruptcy
of
the
company,
or
(b)
Upon
liquidation
or
winding-up
of
the
company,
or
(c)
On
the
sale
of
the
business
presently
being
conducted
by
the
company.
2.
The
personal
representative
of
the
deceased
shareholder
shall
have
the
said
shares
registered
in
the
name
of,
and
delivered
to,
the
surviving
shareholders
who
shall
forthwith
deposit
with
the
trustee
share
certificates
in
endorsed
form
as
security
for
any
unpaid
balance
and
the
trustee
shall
pay
over
to
the
personal
representatives
of
the
deceased
shareholder
the
payments
received
by
him
from
the
surviving
shareholders.
The
trustee
shall
retain
the
certificates
for
the
said
shares
until
the
balance
has
been
fully
paid.
The
surviving
shareholders
shall
have
the
right
however,
to
vote
the
said
shares
deposited
by
them
so
long
as
they
are
not
in
default
under
any
of
the
terms
of
this
agreement,
so
long
as
such
vote
is
not
detrimental
to
the
interests
of
the
deceased
shareholder.
3.
Time
shall
be
of
the
essence
of
this
agreement.
4.
The
shareholders
may
jointly
alter
the
terms
of
this
agreement
with
the
consent
of
the
trustee,
or
may
jointly
revoke
this
agreement
at
any
time
by
notice
in
writing
delivered
to
the
trustee.
5.
The
shareholders
and
each
of
them
shall
indemnify
and
save
harmless
the
trustee
from
all
actions,
claims
and
demands
whatsoever
in
respect
of
any
act
or
thing
done
or
omitted
to
be
done
by
the
trustee
in
or
about
the
execution
of
the
trusts
herein
mentioned.
6.
In
the
event
of
the
death
of
the
said
Alfred
John
Ferguson
Roberts
all
of
the
terms
and
conditions
of
this
agreement
shall
be
in
full
force
and
effect
with
respect
to
the
requirements
of
the
shareholders
surviving
the
said
Alfred
John
Ferguson
Roberts
being
required
to
purchase
such
shares,
and
the
personal
representative
of
the
said
Alfred
John
Ferguson
Roberts
being
required
to
sell
such
shares
in
proportion
to
the
shareholdings
of
the
surviving
shareholders,
save
and
except
that
the
following
special
conditions
shall
apply
with
respect
to
the
sale
of
the
shares
of
the
said
Alfred
John
Ferguson
Roberts,
that
is
to
say:
(a)
A
sum
equivalent
to
Twenty
(20%)
of
the
value
thereof
shall
be
payable
to
the
personal
representative
of
Alfred
John
Ferguson
Roberts,
in
cash,
within
Three
(3)
months
of
the
settlement
of
values
by
the
Estate
Tax
Department
of
the
Department
of
National
Revenue,
Government
of
Canada.
(b)
The
balance
of
the
purchase
price
of
the
said
shares
shall
be
paid
to
the
personal
representative
of
the
said
Alfred
John
Ferguson
Roberts,
in
equal
annual
instalments
amortized
over
a
Five
(5)
year
term,
together
with
interest
at
the
rate
of
Five
per
cent
(5%)
per
annum,
the
first
of
such
equal
annual
payments
to
become
due
and
payable
one
(1)
year
after
the
twenty
per
cent
(20%)
payment
required
to
be
made
herein.
(c)
At
the
present
time,
certain
of
the
shareholders
namely,
Norman
Lindsay
Ross,
Leslie
Edwin
Pope,
Robert
T.
Hoard,
T.
Irvine
Cormack
and
C.
Peter
V.
Forrest
are
purchasing
shares
from
Alfred
John
Ferguson
Roberts
pursuant
to
agreements
dated
the
25th
day
of
December
A.D.,
1965
and
the
15th
day
of
November
A.D.,
1968,
under
terms
calling
for
instalment
payments
for
the
purchase
price
thereof
and
it
is
understood
and
agreed
that
if
any
of
the
above-named
should
die
prior
to
payment
by
them
in
full
to
Alfred
John
Ferguson
Roberts
for
the
purchase
price
of
the
shares,
such
shares
may
be
purchased
by
the
surviving
shareholders
only
upon
terms
allowing
payment
in
full
to
Alfred
John
Ferguson
Roberts
of
any
moneys
owing
to
him;
for
greater
certainty
it
is
understood
and
agreed
by
and
between
the
parties
hereto
that
such
of
the
above-named
shareholders
as
are
alive
at
the
date
of
the
death
of
Alfred
John
Ferguson
Roberts
are
required
to
purchase
the
shares
of
Alfred
John
Ferguson
Roberts
as
aforesaid,
notwithstanding
that
they
may
not
have
completed
payments
to
Alfred
John
Ferguson
Roberts
under
the
agreements
of
December
25th,
1965,
and
November
15th,
1968.
7.
This
agreement
shall
be
binding
upon
the
heirs,
executors
and
administrators
of
each
of
the
shareholders.
In
witness
whereof
the
parties
hereto
have
hereunto
set
their
hands
and
seals,
the
day
and
year
first
above
written.
And
the
agreement
bears
the
signatures
of
the
respective
parties.
The
late
Alfred
John
Ferguson
Roberts
died
on
or
about
August
15,
1970,
intestate.
Letters
of
administration
were
granted
to
the
official
administrator
for
the
County
of
Victoria,
British
Columbia,
on
January
19,
1971.
The
deceased
in
his
lifetime
owned,
amongst
other
things,
4,600
shares
in
the
said
company,
and
the
value
per
share
as
declared
by
the
official
administrator
was
$14.14.
There
was
founded
by
notice
of
reassessment,
dated
February
17,
1972,
a
fixed
value
of
the
said
shares
at
$25.87
each.
Pursuant
to
the
terms
of
the
agreement
aforesaid,
the
appellants
are
bound
to
pay
the
said
value,
and
this
appeal
is
from
the
said
assessment,
alleging
that
this
sum
is
unrealistic
and
too
high.
They
suggested
a
figure
of
$15.47
per
share.
At
the
commencement
of
the
hearing,
T
E
Jackson,
Esq,
QC,
learned
counsel
for
the
respondent,
moved
to
quash
the
appeal
on
the
ground
that
the
appellants
have
no
status
herein,
they
being
neither
executors,
administrators
nor
successors
within
the
meaning
of
the
Estate
Tax
Act.
J
S
de
Villiers,
Esq,
counsel
for
the
administrator,
requested
leave
to
be
heard
on
behalf
of
the
administrator,
and
same
was
granted.
He
similarly
argued
that
the
appellants
had
no
status
herein,
and
the
administrator
apparently
is
satisfied
with
the
respondent’s
assessment
as
it
relates
to
the
value
of
the
shares
in
question.
Learned
counsel
for
the
appellants
argues
that
the
appellants
were
successors
to
the
said
shares
and
beneficially
entitled
thereto
within
the
meaning
of
the
Estate
Tax
Act.
“Successor”
is
defined
by
the
Act,
as
follows:
62.
(1)
In
this
Act,
“successor”
in
relation
to
any
property
passing
on
the
death
of
a
deceased,
includes
any
person
who,
at
any
time
before
or
on
or
after
the
death
of
the
deceased,
became
beneficially
entitled
to
any
such
property
(a)
by
virtue
of,
or
conditionally
or
contingently
on,
the
death
of
the
deceased,
(b)
by
virtue
of
the
exercise
of
any
general
power
of
which
the
deceased
was
the
donee
or
other
holder,
(c)
in
any
case,
under
any
disposition
made
by
the
deceased
during
his
lifetime,
or
(d)
by
virtue
of
the
application
in
respect
of
the
death
of
the
deceased
of
any
law
of
Canada
or
a
province
providing
for
relief
of
dependants
of
deceased
persons,
and
includes
(e)
any
person
beneficially
entitled
to
any
such
property
in
default
of
the
exercise
of
any
general
power
of
which
the
deceased
was
the
donee
or
other
holder,
(f)
any
person
as
the
donee
or
other
holder
of
any
general
power
created
by
the
deceased
in
respect
of
any
such
property,
(g)
any
person
who
on
the
death
of
the
deceased,
had,
under
any
settlement
described
in
paragraph
7(1
)(b),
a
beneficial
interest
in
property
deemed
by
subsection
3(2)
to
be
property
passing
on
such
death,
and
(h)
any
trustee,
guardian,
committee,
curator,
or
other
similar
representative
of
any
person
mentioned
in
this
paragraph,
in
his
capacity
as
such
trustee,
guardian,
committee,
curator
or
other
representative;
If
the
appellants
can
qualify
as
successors,
then
it
follows
that
they
are
entitled
to
be
heard
by
the
Board,
as
the
Act
specifically
so
provides.
The
appellants’
rights
and
liabilities,
in
my
opinion,
stem
only
from
the
agreement,
and
the
only
reference
to
or
connection
with
the
Act
is
the
matter
of
establishing
the
quantum
of
consideration
by
the
respondent.
The
agreement
does
not
give
the
appellants
a
right
to
appeal
from
the
assessment
in
any
way.
One
would
have
thought
that
a
clause
covering
a
dispute
of
this
nature
would
have
been
implemented
to
the
effect
that
in
that
situation
the
executor,
or
administrator,
as
the
case
may
be,
would
have
teen
obliged
to
appeal;
but
the
agreement
does
not
cover
this
eventuality,
nor
does
it
contemplate
the
same
in
any
way.
Th
appellants,
as
purchasers,
in
my
opinion,
are
not
successors
to
the
assets
of
the
deceased,
nor
are
they
beneficially
entitled
thereto
within
the
meaning
of
the
Act.
The
motion,
accordingly,
is
allowed,
and
the
appeal
is
quashed,
by
reason
of
the
fact
that
the
appellants
have
no
status
before
the
Board.
Appeal
quashed.
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