Hardy v. R., [1998] 2 C.T.C. 2013

Rip T.C.J.:

1 Jill Hardy has appealed her income tax assessments for the 1993, 1994 and 1995 taxation years on the basis that she is entitled to deduct, pursuant to paragraph 8(1)(c) of the Income Tax Act (“Act”), the amounts of $5,815, $6,189 and $6,868 respectively, as rent paid for accommodation in those years since she was, and is, “a regular minister of a religious denomination”, ministering to a parish or congregation (“cleric's residence deduction”).[FN1: <p>The conditions required for a taxpayer to claim the deduction are set out in paragraph 8(1)(<em>c</em>):<blockquote><ul>(1) In computing a taxpayer's income for a taxation year from an office or employment, there may be deducted such of the following amounts as are wholly applicable to that source or such part of the following amounts as may reasonably be regarded as applicable thereto:<li><p>(c) where the taxpayer is a member of the clergy or of a religious order or a regular minister of a religious denomination, and is in charge of, or ministering to a diocese, parish or congregation, or engaged exclusively in full-time administrative service by appointment of a religious order or religious denomination, an amount equal to...</p></li></ul></blockquote></p>]

2 There is no dispute between the parties that Ms. Hardy ministered to a parish or congregation. The issue before me is whether Ms. Hardy was “a regular minister of a religious denomination”.

3 Ms. Hardy is a Roman Catholic. Sometime in 1988, or earlier, she applied to the Bishop of London for appointment as Pastoral Minister at St. Joseph's Church in Stratford, Ontario. The Diocese trained her for the position. She also undertook studies at St. Paul's University in Ottawa during summers and at the University of Waterloo's continuing education division.

4 The Bishop of London appointed Ms. Hardy as Pastoral Minister by letter of mandate:

• August 15, 1988

• Mrs. Jill Hardy,

• St. Joseph's Church

• 96 Huron Street,

• Stratford, Ontario N5A 5S6

Dear Mrs. Hardy:

In accordance with the policies of this Diocese and in agreement with the Pastor, Reverend M.G. MacIsaac, I am pleased to appoint you as Pastoral Minister at St. Joseph's Church, Stratford, Ontario.

By this letter, I mandate you to carry out the responsibilities of Lay Pastoral Minister. You are to assist in proclaiming the Good News of Jesus Christ in this parish with Father MacIsaac and Father Masse in a manner which together you determine to be in the best interests of the Universal Church.

In virtue of the authorization granted me by the Holy See, according to the rescript from the Sacred Congregation of the Sacraments, Prot. No. 904/68, I also grant permission to assist in the distribution of Holy Communion at Mass and to take Communion to the sick and shut-ins as required in the Parish. This permission is granted for the duration of your term as Pastoral Minister in the Parish.

I am confident that the people of St. Joseph's Parish will join with me in assuring you of our support and of our prayers in your Ministry. We are grateful to you for accepting this mandate.

This letter may be read and the Service for Commissioning of Extra-Ordinary Ministers may be enacted at all Masses on any Sunday convenient to you and Father MacIsaac.

• In Christ,

• Most Rev. J.M. Sherlock

• Bishop of London.

5 Ms. Hardy was the only witness at trial.[FN2: <p>No one from the Roman Catholic Church testified on Ms. Hardy's behalf. This is unfortunate. Such a person may have informed me of church practice in naming ministers and so assist me in considering these appeals.</p>] At time of trial she was still a minister.[FN3: <p>Since she is still a minister I sometimes describe her work in the present tense; the descriptions apply to the years in appeal as well.</p>] She stated her duties are described in the letter of mandate. She said that she was supervised by, and reported to, the Pastor of the Church, Reverend M.G. MacIsaac, during the years in appeal. She acknowledged that the Pastor's responsibilities are greater than hers. He is responsible for the administration of the parish. The Pastor reports to the Bishop. Ms. Hardy explained that unlike the Pastor, she cannot perform marriages except when given permission by the Bishop, which is rare. She added she may perform at funerals without permission. However, I understand she cannot lead Mass or hear confession. The Pastor, on the other hand, may perform any of the sacraments of the Church. Ms. Hardy testified that according to the second paragraph of the letter of mandate, she assists the clergy of the parish to carry on his duties.

6 Ms. Hardy considers herself to be a regular minister of the Roman Catholic Church ministering to St. Joseph's Parish in Stratford. She has no other employment. The respondent's position is that she was not a “regular” minister as required by paragraph 8(1)(c) of the Act.

7 According to paragraph 8(1)(c), for a taxpayer to be eligible for the cleric's residence deduction, he or she first must be a member of the clergy (or of a religious order) or a regular minister of a religious denomination. The Act appears to distinguish between the two, a member of the clergy and a minister, although Roget's International Thesaurus[FN4: <p>Revised by Robert L. Chapman, Canadian ed., 4th ed., Fitzhenry &amp; Whiteside: Markam, Ont.</p>] considers the words “clergy” and “ministry” as synonyms and the words “clergyman” and “minister” as synonyms.

8 I agree with respondent's counsel that a regular minister need not necessarily be one who is ordained to qualify for the cleric's residence deduction. This may be the reason parliament used the words “clergy” and “minister”; the former is one who is ordained and the latter is one who may or may not be ordained. I refer to the comments of Mackay, J. in Zylstra Estate v. Minister of National Revenue (1994), 94 D.T.C. 6687 (Fed. T.D.), at pp. 6694-95.[FN5: <p>See also the definitions of “clergy” and “clergyman” in<em>The Oxford English Dictionary</em>2nd ed.: “A member of the clergy, is one who has been ordained, especially in the Christian religion”. In other religions, a member of the clergy is of “the priestly order”. Clergy is distinguished from laity.</p>] This distinction may be important in some religions but in others may be only a distinction without a difference.

9 The Oxford English Dictionary defines “lay”:

1. Of persons: Belonging to the “people” as contradistinguished from the clergy; not in orders, non-clerical.

10 Ms. Hardy acknowledged -- and it is a matter of which I may take judicial notice -- that her religion bars women from its clergy. It may well be, as Ms. Hardy said, that other religions may include women in their clergy and that these women clerics do the same work as Ms. Hardy does for her Church. However, this can have no bearing on her claim. Since she was not a member of the clergy during the years in appeal, she must prove that her position as a “Lay Pastoral Minister” was that of a regular minister of the Roman Catholic Church.

11 The words “regular” in the English version of paragraph 8(1)(c) of the Act and “regular” in the French version describe the clergy who are entitled to the deduction Ms. Hardy is seeking. The Oxford English Dictionary defines the Ecclesiastical usage of “regular”:

A.adj.1.Eccl.a. Subject to, or bound by, a religious rule; belonging to a religious or monastic order. (Opposed to secular.) In early use placed after the sb., esp. in canon regular:...

b. Pertaining to, connected with, a monastic rule or those subject to it. rare.

B.adv....

2.Eccl.a. A member of a religious order observing a RULE; one of the regular clergy.

1. (En parlant d'une chose.)...

7. (Opposé à séculier). Relatif à la vie religieuse, aux ordres religieux, aux réguliers...

II. (En parlant d'une personne)...

5. Relig. Qui appartient à un ordre religieux au sens strict... et, par ext., qui appartient à une religion quelle qu'elle soit (opposé à séculier).

12 The Ecclesiastical usage of “regular” in both languages appears to identify specific persons within the church, in particular the Roman Catholic Church. This, I am sure, is not the meaning the legislator wished to incorporate into what is now paragraph 8(1)(c). For example, the inclusion of the expression “members of a religious order” in paragraph 8(1)(c) would render unnecessary the use of the word “regular” in its strict ecclesiastical sense. Further, there are many religions in Canada and the meaning of the word “regular” in paragraph 8(1)(c) should not be restricted to the Roman Catholic religion but should be determined in the context of other religions as well.

13 The Oxford English Dictionary defines the common usage meaning of “regular”:

A.adj.....

4. a. Pursuing a definite course, or observing some uniform principle, of action or conduct; adhering to rule; in mod. use esp. observing fixed times for, or never failing in, the performance of certain actions or duties....

6. b. Of persons: Properly qualified or trained; specially or entirely given up to some occupation or pursuit.

14 Le Grand Robert de la langue française defines the common usage of «régulier» as:

II. (Personnes). 1. Vx. Qui observe les devoirs, les règles de la religion et de la morale....

2. Mod. Qui respecte les usages, les règles en vigueur dans un milieu, une profession, une activité.

15 In both languages, then, the word “regular”, in common usage, is understood commonly to describe a consistent observance of duties or actions. English common usage has the additional meaning of a person devoted to a particular occupation or properly trained in such regard. The word “regular” may also mean “usual; normal; customary”.[FN6: <p><em>The Random House Dictionary of the English Language</em>.</p>]

16 The Oxford English Dictionary defines the word “secular” to include:

1. Eccl. a. Of members of the clergy: Living “in the world” and not in monastic seclusion, as distinguished from “regular” and “religious”.... b. Of or pertaining to secular clergy.

17 There have been several decisions of this Court and its predecessors with respect to the meaning of the words “regular minister”.[FN7: <p>See also<em>Gasparini v. Canada</em>(IT)I (T.C.C.)</p>] In Bloom v. Minister of National Revenue (1964), 64 D.T.C. 39 (Can. Tax App. Bd.), Mr. Fisher, Q.C., considered the meaning of the term “regular minister” for the purposes of paragraph 11(1)(q), the predecessor to paragraph 8(1)(c), and concluded at p. 42, that:

It seems that the regular interpretation to be put upon the words “a regular minister”, according to the decisions of the Courts to which I have referred, is that it is to be interpreted in a religious vein, so as to represent an elevation in rank to some special and recognizable religious status.

18 In Bloom, Mr. Fisher dismissed the appeal since, among other things, the appellant was not ordained and thus had “not been elevated to any special religious status in the Jewish faith”. Goetz, T.C.C.J. in Small v. Minister of National Revenue (1989), 89 D.T.C. 663 (T.C.C.), considered a number of authorities, including the comments of Fisher, Q.C. in Bloom. He concluded at p. 670 that the authorities “recognized, at least some degree of appointment must be conferred, be it by an individual congregation or an aggregate thereof, to act as a minister”.

19 In Kolot v. R. (1992), 92 D.T.C. 2391 (T.C.C.),[FN8: <p>Appealed to Federal Court of Appeal. In<em>Zylstra Estate, et al., supra</em>, Mackay J. chose not to determine whether the taxpayer, Dr. McRae, was a “regular minister”, but merely assumed he was. The decision of the Federal Court Trial Division was subsequently upheld on appeal:(1997), 144 D.L.R. (4th) 573 (Fed. C.A.).</p>] Beaubier, T.C.C.J. relying on Bloom, held that since the appellant, unlike lay members of Church, could be authorized by the United Church of Canada to give all of its sacraments to its members, the appellant qualified for the cleric's residence deduction.

20 A number of cases in various jurisdictions have considered statutory provisions that use the phrase “regular clergyman or minister of a religious denomination” in the context of exemptions from compulsory military service. The meaning given to the words “regular minister” in Bloom and Small are consistent with those cases. In Greenlees v. Canada (Attorney General), [1945] O.R. 411 (Ont. H.C.), aff'd[1946] O.R. 90 (Ont. C.A.), leave to appeal refused[1946] S.C.R. 462 (S.C.C.), Hogg J., considered a number of these cases in determining whether the appellant was a minister as required by the legislation in question.[FN9: <p>The Court of Appeal deferred to Mr. Justice Hogg's analysis on this issue.</p>] In concluding that the appellant was not a minister he followed the decision of the High Court of Justiciary of Scotland in Saltmarsh v. Adaire, [1942] S.C. 58 (Scotland Ct. Just.), in which the phrase “regular minister of a religious denomination” was considered. Mr. Justice Hogg, at p. 420, quoted from the reasons for judgment as follows:

The Lord Justice-General (Normand), at p. 64, said:

The only appointment to which he [the appellant] refers as entitling him to perform spiritual duties, conduct religious services, administer sacraments and the like, depends upon a personal appointment signed by one of the directors of the unlimited company, but there is nothing to show that the grantor of that document was authorised by the congregations, or by anybody representing the congregations, to appoint or ordain ministers....

The appointment by the unlimited company, therefore, was not that of a regular minister within this denomination, and there was no such thing as a regular ministry of the denomination. It was not a permanent appointment; it was merely an appointment terminable at the will of the body which appointed him, and that was an unlimited company. It was not a spiritual appointment, but merely a secular appointment as a servant of that company.

Lord Moncrieff stated that he might have been prepared to assume that the congregations in their aggregate formed a religious denomination. But he said, at p. 65:

I do not, however, require to decide this point, seeing that no appointment was in fact conferred upon the appellant, whether to act as minister or to perform any other service, either by the congregations in their aggregate or by any individual congregation... In so far as the appellant may be supposed to have exercised ministerial functions, these were, accordingly, not exercised by him as holder of any office conferred by these congregations which purported to qualify him to act as the regular minister of a religious denomination....

It is from this unlimited company alone, however, that the appellant draws his sole appointment. It is an appointment which no doubt appears to be exercised by him with the consent of certain of the individual congregations as authorising the performance of certain duties which in another body would only be performed by ordained ministers. That single fact per se, however, whether in view of the limited source of the appointment or on any other view, could never be sufficient to constitute a regular minister.

• i) performs spiritual duties, the conduct of religious services, the administration of sacraments and the like;

• ii) is appointed by a body or person with the legitimate authority to appoint or ordain ministers on behalf of the denomination; and

• iii) is in a position or appointment of some permanence.

In the absence of a legitimate appointment, the mere performance of the duties of a minister will not suffice, in their view, to constitute a “regular minister”.

22 The reasons for judgments in Greenlees and Saltmarsh are of some significance in understanding the use of the phrase “regular minister of a religious denomination” in paragraph 8(1)(c) of the Act. This provision was first enacted in 1949.[FN10: <p>Enacted by s. 4(2) of chapter 25, Statutes of 1949 (2nd Sess.), assented to December 10, 1949.</p>] The draftsman may have turned its mind to the significance of the then recent jurisprudence considering the language of the military exemption legislation. It is not unreasonable to conclude that Parliament used this discrete wording so as to codify the meaning given to it through judicial consideration of its use in other statutory provisions.[FN11: <p>The following excerpt from Hansard of November 10, 1948 with respect to the resolution permitting the cleric's residence deduction helps shed some light on the intention of the Government of the day [Mr. Sinclair was the Parliamentary Secretary to the Minister of Finance]:<blockquote><p><strong>Mr. Graydon</strong>: I should like to have some clarification of resolution [] which has to do with computing the income for 1948 and subsequent taxation years for a member of the clergy or a religious order. I have received an inquiry from a minister of the United Church about this matter, and perhaps the parliamentary assistant could answer it. He asks whether it is the intention of the Minister of Finance that any ordained clergyman, irrespective of his duties in the church or outside the church, shall enjoy this exemption from taxation. In other words, do the words “a regular minister” mean any ordained minister or a minister in a charge? Some ministers are not in a charge, and that is one point this man raised.</p><p>There is another point I should like to raise. Provision is made for deduction of the value of the residence provided for the minister or rented by the minister, but what about a house that the minister owns? In many cities, ministers serving congregations own their own houses. This man suggests that such exemptions should be enlarged to include such cases.</p><p><strong>Mr. Sinclair</strong>: The answer to the first question is that it is not necessary for the minister to have what is ordinarily referred to as a charge. He may be assisting a minister or doing general work, but so long as his full-time occupation is the ministry, then he is allowed this deduction. So far as the second point is concerned, a minister who owns his own home is allowed the equivalent of the rent he would have to pay if he were renting a house of that type.</p><p><strong>Mr. Graydon</strong>: If a minister is in some work such as teaching in a college, or something which has to do with the religious denomination to which he is attached, does he come under the provisions the parliamentary assistant has just mentioned?</p><p><strong>Mr. Sinclair</strong>: If, for example, he were secretary to a church council -- is that what the hon. member is talking about? It would be full-time religious work, but not necessarily in charge of a congregation.</p><p><strong>Mr. Graydon</strong>: I am thinking more particularly of a man who is teaching at the United Church college, who is a minister but is not engaged in ordinary ministerial work at the moment.</p></blockquote></p><p><em>Mr. Sinclair</em>: He would be regarded as a teacher rather than as a minister attending to full-time religious activities.</p>]

23 Each religion has its own practices, traditions and rules, and any branch of a religion may have different practices, traditions and rules from other branches of the same religion. Whether one qualifies as a regular minister or as a member of the clergy, it seems to me, depends on one's religion and, in some cases, one's church, synagogue, mosque or other congregation. In other words, eligibility for the deduction is religion and practice dependent.

24 I am not satisfied that Ms. Hardy has proven that she was a regular minister of the Roman Catholic Church. The fact that she is a Roman Catholic means she has a greater burden to prove her claim than a person whose religion accepts women in its clergy. Ms. Hardy trained for her position and was appointed by the Bishop of London to perform spiritual duties. This was her full-time occupation. Her authority to perform such duties appears to be at the pleasure of the Bishop of London and, therefore, her appointment does not appear to be permanent.

25 As minister, Ms. Hardy is not permitted to perform certain sacraments of her Church that are basic to her religion and which are performed by clergy: she cannot lead Mass or hear confession, for example. Without the authority to perform all the sacraments or rites of her Church she cannot be said to be a “regular” minister, that is, one who may perform all duties normally carried on by a minister of one's religion. There is no evidence before me that Ms. Hardy, in the performance of her duties, was authorized to do anything which other non-Catholics were not permitted to do as lay members of the Roman Catholic Church. In the years under appeal she was essentially a lay person ministering to the parish assigned to her, but she was not a regular minister, as that term is applied by the Act.

26 The appeals will therefore have to be dismissed.