CATTANACH,
J.:—This
is
an
appeal
against
the
appellant’s
income
tax
assessments
for
the
taxation
years
1957
and
1958,
whereby
the
Minister
added
the
sums
of
$222,619.33
and
$7,606.47
as
the
estimated
profit
element
on
the
sale
of
a
shopping
centre,
known
as
Dorwin
Shopping
Center,
in
the
respective
taxation
years.
The
appellant,
by
notices
of
objection
dated
September
23,
1959
lodged
its
objection
against
the
assessments
contending
that
a
profit
of
$424,035.23
on
the
sale
of
the
shopping
centre
was
the
capital
accretion
from
an
investment.
After
reconsideration,
the
Minister
by
notification
dated
March
1,
1960
advised
the
appellant
that
he
confirmed
the
assessments
as
being
in
accordance
with
the
provisions
of
the
Income
Tax
Act,
R.S.C.
1952,
ce.
148,
and
particularly
on
the
ground
that
the
profit
on
the
sale
of
the
shopping
centre
had
been
properly
taken
into
account
in
computing
the
appellant’s
income
in
accordance
with
the
provisions
of
Sections
3,
4,
85B
and
139(1)
(e)
of
the
Act.
It
is
against
these
assessments
that
the
appellant
brings
its
appeal
to
this
Court.
The
issue
in
the
appeal
is
thus,
a
narrow
one,
namely,
whether
the
profit
accruing
to
the
appellant
in
its
taxation
years
1957
and
1958
was
income
from
a
business,
including
therein,
by
virtue
of
Section
139(1)
(e)
of
the
Act,
an
adventure
or
concern
in
the
nature
of
trade.
There
is
no
dispute
as
to
the
accuracy
of
the
foregoing
figures
nor
upon
the
facts,
but
the
dispute
lies
in
the
proper
deduction
to
be
drawn
from
the
facts.
In
1954
Dominion
Stores
Limited
(hereinafter
called
Dominion),
a
company
operating
an
extensive
chain
of
food
markets,
built
a
super
food
market
on
a
site
at
the
intersection
of
Dougall
Avenue
and
Eugenie
Street
in
Sandwich
West
Township
just
outside
the
city
limits
of
Windsor,
Ontario.
The
site
had
a
frontage
of
1840
feet
on
Dougall
Avenue,
a
principal
thoroughfare
leading
into
the
city
of
Windsor
and
contained
approximately
36
acres,
the
entire
area
being
owned
by
Dominion,
The
building
and
parking
space
contiguous
thereto
constructed
by
Dominion
occupied
approximately
four
acres
leaving
an
unoccupied
area
of
32
acres.
The
general
contractor
for
the
erection
of
this
building
for
Dominion
was
Eastern
Construction
Limited
(hereinafter
referred
to
as
Eastern),
a
company
owned
and
controlled
by
the
Odette
family,
a
family
long
prominent
in
the
business
and
social
life
of
the
Windsor
community.
Eastern
was
engaged
in
the
business
of
a
general
contractor,
that
is
the
company
built
on
behalf
of
others
and
did
not
engage
in
speculative
building
although
the
company
did
build
and
own
an
office
building
for
its
own
use,
the
ownership
of
which
building
was
subsequently
transferred
to
another
company.
On
completion
of
the
Dominion
store
building
one
of
the
Odettes
made
a
proposal
to
Dominion
to
purchase
the
store
building
and
lease
it
back
to
Dominion.
This
proposal
was
briefly
considered
and
rejected
by
Dominion
because
the
proposed
rental
was
less
advantageous
than
that
obtained
by
Dominion
in
a
subsequent
similar
arrangement
with
another
party.
However,
Dominion
countered
with
a
proposal
that
the
surplus
land
owned
by
it
should
be
sold
to
the
Odettes
for
the
purpose
of
erecting
thereon
a
shopping
centre
of
which
the
Dominion
food
market
would
be
a
component
part.
This
suggestion
was
made
by
the
officers
of
Dominion
on
December
6,
1954.
The
Odettes
interested
in
this
proposal
were
T.
C.
Odette,
a
lawyer,
his
cousins
L.
L.
Odette
Jr.
and
E.
G.
Odette,
and
L.
L.
Odette,
his
uncle,
all
of
whom
were
shareholders
and
directors
of
Eastern.
At
this
time
the
development
of
shopping
centres
in
Canada
was
not
extensive
but
resort
for
information
was
had
by
the
Odettes
to
the
United
States
experience
where
the
impetus
to
this
type
of
merchandising
was
achieving
major
proportions.
They
were
impressed
by
the
possibilities
and
projected
a
million
dollar
centre
financed
by
a
$200,000
personal
advance
and
an
$800,000
mortgage
which
they
concluded
would
be
self-
liquidating
in
twenty
years
and
yield
an
annual
return
of
19%.
The
project
was
discussed
with
a
firm
of
Detroit
architects
who
recommended
a
firm
of
research
specialists
in
this
field,
as
well
as
Detroit
Mortgage
and
Realty
Company,
as
also
having
a
wide
experience
and
a
record
of
successful
participation
in
projects
of
this
kind.
The
research
specialists,
Real
Estate
Research
Corporation
of
Chicago,
Illinois,
was
engaged
and
conducted
a
survey
of
the
area.
The
results
of
this
survey
were
embodied
in
a
written
report
dated
March
1,
1955,
although
frequent
verbal
reports
were
made
by
the
investigators
before
completion
of
the
written
report
which
was
introduced
in
evidence
as
Exhibit
1.
It
was
concluded
by
the
investigators
so
engaged
that
the
site
met
all
of
the
physical
and
locational
requirements
of
an
effective
retail
district
and
that
a
modern
centre
of
244,950
square
feet
of
net
sales
area
in
enclosed
space,
built
at
this
location,
would
have
gross
annual
business
volume
of
$20,298,000.
This
volume
estimate
was
based
on
the
assumption
that
the
centre
would
attract
a
major
department
store
tenant
not
previously
represented
in
Windsor
by
a
full
sized
retail
store.
It
was
estimated
that
in
the
primary
shoppers
goods
category
alone
there
was
a
market
for
156,950
sq.
ft.
of
net
sales
area
which
would
gross
$10,608,000
annually
and
in
convenience
goods
categories
alone
there
was
a
market
for
36,000
sq.
ft.
of
net
sales
area
grossing
an
annual
volume
of
$6,033,000.
It
was
also
estimated
that
a
department
store
of
the
type
envisaged
would
gross
an
annual
volume
of
business
of
$5,077,000
and
would
require
approximately
77,000
sq.
ft.
of
sales
area.
A
local
realtor
was
also
engaged
by
the
Odettes
to
make
a
survey
of
the
downtown
business
section
of
Windsor
and
other
sections
to
find
the
actual
rents
paid
for
stores
of
all
types
who
made
a
report
dated
February
21,
1955,
filed
in
evidence
as
Exhibit
2.
Discussions
were
initiated
with
Mr.
Peas,
the
president
of
Detroit
Mortgage
and
Realty
Company
(hereinafter
referred
to
as
Detroit
Mortgage)
who
verbally
assured
the
Odettes
that
financing
by
way
of
an
$800,000
mortgage
would
be
readily
forthcoming.
In
addition
to
being
the
financial
agents
of
the
proposed
shopping
centre,
Detroit
Mortgage
was
also
to
act
as
leasing
agent
and
there
was
also
the
possibility
of
Detroit
Mort-
gage
buying
shares
in
a
company
to
be
incorporated
for
the
purpose
of
owning
and
operating
the
shopping
centre.
Based
upon
the
optimistic
and
favourable
report
of
the
research
specialists
engaged,
the
information
as
to
prevailing
rental
rates,
the
oral
assurance
of
the
president
of
Detroit
Mortgage
that
mortgage
financing
would
be
available,
coupled
with
their
own
appraisal
of
the
possibilities
and
the
encouragement
of
Dominion,
the
Odettes
decided
to
undertake
the
project.
Accordingly,
L.
L.
Odette
Jr.
and
E.
G.
Odette
in
the
respective
capacities
of
secretary
treasurer
and
vice
president
of
Eastern
Construction
Limited
as
purchaser,
executed
an
offer
to
purchase
the
surplus
32
acres
owned
by
Dominion,
the
vendor,
for
a
purchase
price
of
$127,304,
$10,000
of
which
price
was
deposited
on
the
execution
of
the
offer
and
the
balance
of
$117,304
was
paid
on
the
closing
date
of
March
31,
1955.
The
offer
was
made
and
accepted
subject
to
conditions
summarized
as
follows:
(1)
that
the
property
would
be
developed
solely
as
a
regional
shopping
centre
in
such
a
manner
as
to
include
the
building
erected
by
Dominion
as
an
integral
part
thereof;
(2)
that
the
purchaser
covenanted
(such
covenant
to
run
with
the
land)
for
a
period
of
25
years
not
to
erect
or
permit
to
be
erected
any
building
for
the
purpose
of
carrying
on
any
business
which
would
conflict
or
compete
with
the
business
carried
on
by
Dominion;
(3)
that
the
general
layout
and
minimum
size
of
the
shopping
centre
should
be
subject
to
the
approval
of
Dominion,
and
(4)
that
the
purchaser
should
commence
actual
construction
of
the
initial
phase
of
the
shopping
centre
within
10
months
from
the
date
of
the
conveyance
of
the
land
and
in
the
event
of
construction
not
being
so
commenced
the
purchaser
was
obligated
to
offer
the
land
purchased
for
repurchase
by
the
vendor
at
the
Same
price
as
was
paid
therefor.
The
vendor
was
given
forty
days
within
which
to
accept
or
reject
the
offer
and
if
the
offer
to
repurchase
was
not
accepted
within
that
time,
then
the
purchaser
could
deal
with
the
property
as
it
deemed
fit
subject
to
the
restrictions
laid
down.
There
were
other
restrictions
included
in
the
offer
which
I
have
not
included
in
the
foregoing
summary
because
they
have
no
bearing
on
the
issue
involved
in
this
appeal.
The
offer
was
executed
by
Eastern
Construction
Limited
through
its
signing
officers
as
above
described
on
March
15,
1955
and
was
accepted
by
Dominion
Stores
Limited
also
on
March
15,
1955
although
the
date
of
the
acceptance
by
Dominion
Stores
Limited
was
inserted
in
error
in
the
instrument
as
being
February
15,
1955.
By
deed
dated
April
29,
1955
Dominion
Stores
Limited
conveyed
title
in
the
lands
in
question
to
Eastern
Construction
Limited
subject
to
the
restrictive
covenant
prohibiting
competition
with
Dominion.
The
offer
to
purchase
was
executed
by
Eastern
Construction
Limited
and
the
land
was
conveyed
to
Eastern
by
Dominion
because
Dorwin
Shopping
Center
Limited,
the
appellant
herein,
had
not
been
incorporated
at
that
time,
although
the
corporate
name
had
been
reserved
with
the
provincial
incorporating
authority.
Letters
patent
dated
May
9,
1955
issued
pursuant
to
the
laws
of
the
Province
of
Ontario
incorporating
the
appellant
under
the
corporate
name
of
Dorwin
Shopping
Center
Limited
with
an
authorized
capital
divided
into
100,000
preference
shares
of
the
par
value
of
$10
each
and
300,000
common
shares
without
nominal
or
par
value
which
might
be
issued
for
a
consideration
not
to
exceed
in
amount
or
value
the
sum
of
$300,000.
The
head
office
of
the
company
was
fixed
as
being
in
the
Township
of
Sandwich
West
and
the
objects
for
which
incorporation
was
obtained
read
in
part
as
follows,
‘‘to
acquire
by
purchase,
exchange,
concession
or
otherwise
lands
and
premises’’
and
here
is
inserted
the
precise
description
of
the
lands
conveyed
by
Dominion
to
Eastern,
‘‘and
to
develop
thereon
a
shopping
centre
and,
without
limiting
the
generality
of
the
foregoing,
for
that
purpose
to
lay
out
parking
areas
and
to
erect
stores,
shops,
offices,
restaurants
and
buildings
of
every
description
and
to
own,
operate
and
maintain
the
same
and
to
rent,
lease,
mortgage
or
otherwise
charge
or
encumber
the
same
or
any
part
thereof
’
’.
The
appellant
was
forthwith
organized
and
shares
in
the
capital
stock
were
allotted
and
issued
to
the
extent
of
$76,150,
of
which
amount
$60,000
was
in
preference
shares
of
the
par
value
of
$10
each.
L.
L.
Odette,
E.
G.
Odette
and
L.
L.
Odette
Jr.
each
subscribed
and
paid
for
2,000
preference
shares.
The
161,500
common
shares
without
nominal
or
par
value
were
subscribed
for
and
issued
at
100
per
share
of
which
126,020
were
subscribed
and
paid
for
by
the
Odettes
and
members
of
their
family,
E.
G.
and
L.
L.
Odette
Jr.
each
subscribing
for
45,000
common
shares,
L.
L.
Odette,
20,000
common
and
T.
C.
Odette
9,000
common.
The
balance
of
11,020
common
shares
was
acquired
by
the
members
of
their
families.
A
further
balance
of
35,480
common
shares
were
issued
to
other
persons
closely
associated
with
the
Odettes.
The
cash
received
in
the
treasury
of
the
appellant
was
$75,400,
made
up
of
$60,000
for
the
preferred
shares,
$15,400
for
the
common
shares
and
$750
was
unpaid
on
7,500
common
shares
subseribed
for.
By
deed
dated
July
26,
1955
the
land
which
had
been
conveyed
from
Dominion
to
Eastern
by
deed
dated
April
29,
1955
was
in
turn
conveyed
by
Eastern
to
the
appellant.
Neither
of
these
deeds
was
registered
in
the
Registry
Office
for
the
County
of
Essex
until
March
16,
1956.
This
delay
was
explained
by
the
circumstance
that
both
Eastern
and
the
appellant
had
the
utmost
confidence
in
the
business
integrity
of
Dominion
and
further
that
the
Odettes
did
not
wish
to
disclose
they
were
the
principals
in
the
shopping
centre
because
of
a
bitter
controversy
in
the
City
of
Windsor
concerning
night
shopping
from
which
the
Odettes
wished
to
remain
aloof
and
speculators,
real
estate
agents
and
potential
rivals
could
identify
the
principals
in
the
centre
by
a
search
of
the
Registry
records.
The
shopping
centre
in
its
ultimate
development
was
to
consist
of
three
wings,
Wing
A,
the
initial
phase
was
to
be
built
immediately
adjacent
to
the
existing
Dominion
store
building
with
a
frontage
of
approximately
600
ft.
Wing
B
was
to
be
the
department
store
with
a
frontage
of
approximately
200
ft.
in
the
centre
of
the
development
and
the
third
phase,
Wing
C
was
to
be
similar
in
size
and
structure
to
Wing
A
and
on
the
other
side
of
the
department
store,
Wing
B.
There
was
also
in
contemplation
the
possibility
of
constructing
at
some
future
time
a
high
rise
office
building
beyond
the
third
wing.
A
formal
agreement
was
entered
into
between
Eastern
and
the
appellant
on
June
8,
1955
whereby
Eastern
undertook
to
construct
Wing
A
of
the
shopping
centre
for
the
appellant
for
the
compensation
of
cost
plus
314
per
cent
thereon.
However,
prior
to
the
incorporation
of
the
appellant
and
the
execution
of
the
construction
agreement
between
the
appellant
and
Eastern,
construction
had
already
been
begun
by
Eastern.
which
is
understandable
because
the
Odettes
comprised
the
directorates
of
both
Eastern
and
the
appellant
as
well
as
owning
all
the
shares
in
Eastern
and
an
overwhelming
majority
of
the
shares
of
the
appellant.
A
sub-contractor
of
Eastern
began
clearing
the
site
of
trees
and
a
small
cement
block
structure
as
well
as
filling
and
levelling
during
the
latter
part
of
April
1955.
On
June
1,
1955
Eastern
had
placed
an
order
for
the
bricks
to
be
used
and
the
Municipality
of
West
Sandwich
had
begun
the
construction
of
a
drainage
sewer
to
serve
the
proposed
parking
area
pursuant
to
an
arrangement
negotiated
by
Eastern.
Excavation
for
the
building
was
begun
during
the
first
part
of
July
1955.
The
form
work
was
on
the
site
on
August
10,
1955
and
the
first
concrete
was
poured
on
August
19,
1956.
Also
during
the
month
of
August
the
sub-contractor
for
paving
was
engaged
in
filling
and
laying
asphalt
on
the
parking
area.
On
August
18,
1955
the
electrical
sub-contractor
began
the
installation
and
erection
of
lighting
standards
for
the
parking
area.
August
was
an
extremely
busy
month.
The
work
order
for
the
structural
steel
had
been
placed
on
September
19,
1955
and
the
steel
was
erected
on
October
20,
1955.
The
order
for
the
steel
roof
deck
had
been
placed
on
September
1,
1955
and
its
installation
began
on
November
10,
1955.
Before
the
end
of
January
1956
the
shell
of
the
building
was
completed,
that
is
the
walls
and
roof
excepting
the
front.
An
outside
canopy
was
erected
in
January
of
1956.
The
final
completion
of
the
interior
could
not
be
undertaken
until
the
requirements
of
the
tenants
were
known.
The
formal
opening
of
the
building
took
place
on
June
1,
1956.
The
tenants
by
the
terms
of
their
leases
were
entitled
to
four
to
six
weeks
notice
of
the
premises
being
ready
for
occupancy.
Accordingly
it
follows
that
for
all
practical
purposes
the
building
was
completed
on
May
1,
1956.
Exceptional
quality
was
built
into
the
structure
and
novel
features
were
incorporated.
The
Dominion
store
building
was
serviced
by
a
septic
tank
installed
at
a
cost
of
$6,000.
While
it
was
possible
to
service
Wing
A
of
the
shopping
centre
with
a
septic
tank,
nevertheless
a
sewage
disposal
plant,
sufficient
to
service
the
needs
of
the
proposed
department
store
and
Wing
C,
was
installed
at
a
cost
of
$35,000.
The
drainage
sewers
for
the
run-off
from
the
parking
area
were
over
built
by
the
Municipality
at
the
insistence
of
the
appellant,
the
cost
of
which
would
be
borne
by
the
appellant
by
way
of
increased
taxes.
Similarly
the
lighting
capacity
for
the
parking
area
was
over
built
by
30
per
cent.
Structural
steel
was
used
throughout
the
building
to
permit
easier
variation
in
store
sizes
to
suit
the
needs
of
tenants.
The
suggestions
of
insurance
brokers
were
invited
and
adopted
so
as
to
render
each
store
fireproof
with
the
result
that
the
lowest
of
insurance
rates
was
obtained.
The
front
of
the
building
was
raised
to
accommodate
store
signs
with
a
consequent
increase
in
building
costs.
A
12
foot
outside
canopy
was
constructed
in
a
manner
to
permit
its
eventual
enclosure
with
heating
and
air
conditioning
in
the
appropriate
seasons.
The
parking
area
was
constructed
with
an
8
inch
compact
fill
and
a
two
inch
surface
rather
than
with
the
usual
four
inch
compact
fill
and
lesser
thickness
of
surface.
All
such
features
were
designed
to
lower
maintenance
costs
and
for
the
increased
convenience
of
tenants
and
patrons.
The
estimated
building
cost
of
Wing
A
was
$1,000,000
and
the
actual
building
cost
coincided
with
that
estimate.
A
calculation
based
upon
the
estimated
rental
income
less
maintenance
costs
allowing
for
a
mortgage
of
$800,000
at
51%
per
cent
and
a
personal
outlay
of
$200,000
resulted
in
an
estimated
yield
of
19
per
cent.
A
similar
calculation
based
on
a
mortgage
of
$700,000
and
a
personal
outlay
resulted
in
an
approximate
yield
of
13
per
cent.
The
method
of
financing
contemplated
by
the
appellant
was
by
way
of
a
first
mortgage
of
$800,000
and
a
$200,000
outlay
by
it.
The
appellant,
through
the
Odettes
who
became
directors
of
and
shareholders
in
the
appellant,
was
orally
assured
by
the
president
of
Detroit
Mortgage
that
$800,000
secured
by
a
mortgage
would
be
available,
which
assurance
was
made
prior
to
the
project
being
embarked
upon.
However,
no
firm
written
commitment
was
given
the
appellant.
It
is
not
the
practice
in
the
trade
to
give
a
written
mortgage
commitment
until
the
construction
of
the
building
is
well
advanced
and
a
substantial
portion
of
the
building
has
been
leased
to
responsible
tenants.
Accordingly
interim
financing
was
essential
which
was
undertaken
by
Eastern
and
in
part
from
the
resources
of
the
appellant.
Funds
for
interim
financing
came
from
the
following
sources,
$75,400
from
the
share
capital
of
the
appellant
and
$125,652.06
from
shareholders
as
loans
to
the
appellant,
a
personal
loan
to
Eastern
in
the
amount
of
$80,000
by
L.
L.
Odette
Jr.
and
E.
G.
Odette
which
they,
in
turn,
had
obtained
from
their
bank,
a
tender
loan
of
$44,500
Eastern
had
obtained
from
its
bank
which
had
not
been
heretofore
required
or
taken,
and
a
bank
overdraft
carried
by
Eastern
in
the
amount
of
$193,000.
Prior
to
this
time
Eastern
had
never
operated
on
a
bank
overdraft
but
had
always
sufficient
cash
available
to
discharge
its
business
obligations
and
to
cover
any
tender
made
by
it.
In
addition
the
appellant
borrowed
$100,000
from
its
bank
on
the
security
of
a
promissory
note.
I
total
the
foregoing
amounts
to
a
rounded
figure
of
$518,500.
The
mortgage
monies,
when
and
if
received,
would
be
used
to
discharge
these
obligations,
as
well
as
unpaid
construction
costs
incurred,.
with
the
exception
of
$75,400
from
the
share
capital
of
the
appellant
and
the
possible
exception
of
the
shareholders’
loans
to
the
appellant
in
the
amount
of
$125,652.06.
It
was
left
to
a
future
decision
whether
such
shareholders’
loans
would
be
taken
up
by
a
further
issue
of
shares
from
the
treasury
of
the
appellant
or
repaid
in
cash
if
mortgage
funds
were
available
for
that
purpose.
Meanwhile
commitments
for
the
costs
of
construction
were
incurred
and
assumed
by
Eastern.
A
monthly
schedule
thereof
was
filed
in
evidence
as
Exhibit
8.
The
costs
incurred
at
the
material
dates
of
August
1955
and
April
1956
were
shown
therein
as
$211,442.92
and
$719,436.82
respectively.
However,
these
amounts
do
not
include
the
cost
of
verbal
work
and
purchase
orders
but
only
those
actual
orders
received.
In
many
instances
a
verbal
order
would
be
placed
for
materials
and
the
written
order
would
not
be
given
until
some
time
later.
Therefore,
the
schedule
(Exhibit
8)
does
not
reflect
the
cost
of
verbal
orders
placed
in
each
month
and
the
commitments
in
each
month
might
well
be
and
usually
were
greater
than
the
amounts
shown
therein.
While
construction
was
proceeding,
negotiations
were
being
conducted
with
prospective
tenants.
Mr.
Peas,
the
president
of
Detroit
Mortgage
made
several
trips
into
Ontario
to
secure
tenants
and
consulted
well
and
favourably
known
retail
merchants.
His
activities
came
to
the
notice
of
the
provincial
official
in
charge
of
the
supervision
of
real
estate
and
business
brokers
who
advised
Detroit
Mortgage
by
letter
dated
July
25,
1955
that
it
could
not
qualify
to
act
as
a
leasing
agent
in
Ontario
and
was
therefore
precluded
from
doing
so.
However,
Detroit
Mortgage
continued
to
act
as
leasing
agent
in
the
State
of
Michigan
and
the
remaining
States.
Shortly
after
Detroit
Mortgage
was
advised
of
its
incapacity
to
act
as
leasing
agent
in
Ontario,
the
time
being
fixed
by
witnesses
as
the
middle
of
August
1955,
Detroit
Mortgage
withdrew
entirely
from
the
project
in
all
capacities
so
that
mortgage
money
was
not
forthcoming
from
that
source.
At
this
time
the
construction
of
the
centre
was
well
advanced.
The
officers
of
the
appellant
themselves
began
a
vigorous
campaign
to
obtain
tenants
which
was
comparatively
successful.
A
letter
of
intent
was
received
from
S.
8S.
Kresge
Company,
a
variety
store,
and
from
Cunninghams
Drugs,
a
company
which
operated
a
large
chain
of
drug
stores
in
the
United
States
and
contemplated
extending
its
operations
into
Canada.
Because
of
the
proximity
of
Windsor
to
the
City
of
Detroit,
this
drug
chain
was
extremely
well
known
in
the
Windsor
area.
Further
it
was
a
condition
of
the
8S.
S.
Kresge
Company
lease
that
the
centre
should
contain
a
drug
store.
On
March
21,
1956
Cunningham
Drugs
advised
the
appellant
it
would
not
lease
premises
in
the
centre.
However,
the
appellant
was
successful
in
leasing
premises
to
another
drug
store
chain.
The
first
three
tenants
were
obtained
in
November
of
1955.
As
at
April
27,
1956
the
centre
was
leased
to
the
extent
of
over
60
percent
but
not
exceeding
70
percent.
On
November
1,
1956
the
centre
was
leased
to
the
extent
of
75
percent.
It
had
been
a
further
condition
of
the
S.
S.
Kresge
Company
lease
that
the
centre
should
be
leased
to
the
extent
of
80
percent
but
this
condition
was
foregone
at
the
request
of
the
appellant.
The
recommendations
and
conclusions
of
the
research
specialist
engaged
and
as
embodied
in
its
report,
Exhibit
I,
dated
March
1,
1955
were
predicated
upon
the
assumption
that
the
centre
would
contain
a
major
department
store,
which
the
location
and
population
would
justify,
and
upon
which
assumption
its
estimate
of
business
volume
was
based.
The
officers
of
the
appellant
recognized
that
the
presence
of
a
major
department
store
in
the
centre
would
be
of
great
advantage,
but
not
necessarily
an
essential
feature.
It
was
their
opinion
that
the
Dominion
food
market,
as
an
integral
part
of
the
centre,
the
presence
of
the
S.
8S.
Kresge
variety
store,
and
the
chain
drug
store,
together
with
the
remaining
desirable
tenants
obtained,
would
ensure
the
success
of
a
neighbourhood
shopping
centre.
Nevertheless,
they
were
fully
conscious
that
a
department
store
would
render
the
centre
much
more
attractive
and
profitable
for
which
reason
efforts
were
made
to
induce
such
a
store
to
locate
in
the
centre.
There
were
overtures
made
by
the
appellant
to
such
well
known
department
stores
as
Eatons,
Morgans,
Woodwards,
Simpson-Sears
and
Great
Universal
Stores
of
England.
Eatons
and
Morgans
indicated
some
interest
with
a
rental
based
upon
a
percentage
of
sales
with
no
minimum
provided.
An
arrangement
of
this
nature
was
not
acceptable
to
lenders
as
security
for
a
loan.
The
appellant
also
offered
a
gift
of
four
acres
of
land
to
the
department
stores
mentioned
to
induce
them
to
erect
a
building
and
establish
a
store
in
the
centre.
None
of
the
stores
so
approached
accepted
the
appellant’s
offer.
The
appellant
resorted
to
other
means
to
raise
money
and
obtain
a
department
store
for
the
centre.
A
letter
dated
October
14,
1955,
Exhibit
13,
was
written
to
John
Penturn
&
Son
Limited,
realtors
of
Toronto,
Ontario
offering
to
sell
land
for
an
office
building
as
well
as
for
a
department
store.
A
letter
dated
October
20,
1955,
Exhibit
15,
was
written
to
R.
B.
Slaven
of
Tower
Investment
Corp.,
Ltd.
also
of
Toronto,
Ontario,
making
a
similar
offer.
Neither
of
such
letters
produced
any
result.
Within
a
short
time
from
August
1955
when
Detroit
Mortgage
withdrew
its
support
of
the
project,
the
appellant
came
in
need
of
further
funds.
Eastern
had
committed
itself
to
construction
costs
in
the
excess
of
$200,000
and
had
exhausted
its
bank
credit.
Therefore
it
became
of
paramount
importance
to
obtain
a
mortgage
loan.
The
appellant
then
began
to
make
applications
to
the
outstanding
lenders
of
mortgage
monies.
In
September
1955
the
appellant
wrote
to
New
York
Life,
in
December
1955
to
Prudential
Life,
on
January
3,
1956
to
Canada
Life,
on
February
22,
1956
to
Metropolitan
Life,
on
March
28,
1956
to
London
Life,
on
March
29,
1956
to
Great
West
Life,
all
of
which,
after
consideration,
declined
to
advance
monies
to
the
appellant
on
security
of
a
first
mortgage.
The
appellant’s
most
promising
effort
was
an
application
to
Massachusetts
Mutual
Life
Insurance
Company
(hereinafter
referred
to
as
Massachusetts),
a
company
which
did
extensive
financing
of
shopping
centres.
The
appellant
telephoned
the
head
office
in
Springfield,
Massachusetts
and
was
referred
to
the
regional
office
in
Detroit,
Michigan.
Mr.
T.
Strehlow,
the
assistant
regional
supervisor
of
the
company,
together
with
the
regional
supervisor,
thoroughly
investigated
the
centre
and
other
material
factors
and
requested
the
appellant
to
complete
the
company’s
standard
form
of
application.
for
a
mortgage
in
the
amount
of
$800,000
which
was
done
on
January
19,
1955.
Mr.
Strehlow
testified
the
application
was
forwarded
to
head
office
with
his
recommendation
for
its
approval
and
that
he
had
every
expectation
the
loan
would
be
approved.
On
February
10,
1956
the
head
office
requested
to
be
supplied
with
further
information
which
was
supplied.
The
application
was
subsequently
refused.
Mr.
Strehlow
began
his
investigation
in
November
1955
at
which
time
only
three
of
the
twenty-three
stores
in
Wing
A
had
been
leased.
He
explained
that
the
small
number
of
leases
would
not
be
an
impediment
to
the
Massachusetts
giving
a
letter
af
commitment,
but
the
commitment
would
be
given
subject
to
the
requirement
of
leasing
being
completed
to
a
specified
percentage
and
he
stated
that
satisfactory
leasing
was
an
important
factor
to
a
mortgage
loan.
Had
a
letter
of
commitment
been
forthcoming
from
Massachusetts,
the
bank
would
have
been
prepared
to
advance
Eastern
further
funds
by
way
of
overdraft.
The
first
approach
by
the
appellant
to
Canada
Life
was
for
a
loan
of
$800,000
which
was
refused.
A
second
approach
was
made
to
Canada
Life
in
March
of
1956
for
a
loan
in
the
lesser
amount
of
$600,000
which
was
also
refused.
The
appellant,
through
its
officers,
made
frequent
and
continuous
pleas
to
Dominion
for
assistance
in
financing,
While
Dominion
gave
help
in
negotiating
leases
by
assuring
prospective
tenants
that
its
supermarket
on
the
site
was
one
of
its
most
successful
markets,
nevertheless,
no
financial
help
was
given
to
the
appellant.
T.
C.
Odette
testified
that
during
the
latter
part
of
1954
and
the
initial
half
of
the
year
1955,
mortgage
money
was
in
plentiful
supply
and
that
Mr.
Peas
of
Detroit
Mortgage
had
repeatedly
and
emphatically
assured
him
that
a
mortgage
loan
of
$800,000
would
be
forthcoming
to
the
appellant.
Mr.
Odette
further
testified
that
subsequent
to
the
withdrawal
of
Detroit
Mortgage
from
participation
in
the
project
in
August
of
1955,
the
appellant’s
attempts
to
obtain
a
mortgage
from
the
other
sources
mentioned
above
were
thwarted
by
a
policy
of
tight
money
and
retrenchment
and
that
the
lending
institutions
approached
were
stringently
allocating
their
funds
available
to
applications
previously
received.
In
this
he
was
confirmed
by
Dr.
Gilbert
Horne,
Director
of
the
School
of
Business
Administration
at
Assumption
University
at
Windsor,
who
had
made
a
survey
of
the
money
market
in
the
years
1955
and
1956
from
which
he
concluded
that
beginning
in
the
third
quarter
of
1955
money
tightened,
credit
conditions
became
tight
and
money
rates
went
up
until
the
end
of
1956,
as
a
consequence
of
which
loans
and
mortgage
funds
became
difficult
to
obtain
during
this
period.
Evidence
to
like
effect
was
also
given
by
Mr.
Walter
Blum,
the
manager
of
the
Canadian
Imperial
Bank
at
Walkerville.
Mr.
Blum
also
testified
that
the
appellant
and
Eastern
for
whom
he
acted
as
banker
had
both
borrowed
to
the
extent
of
their
credit
from
the
Bank.
While
the
appellant’s
centre
was
in
the
course
of
construction
there
were
press
announcements
and
rumours
of
several
other
shopping
centres
to
be
built
in
Windsor,
few
of
which
materialized.
In
September
1955
L.
Cousens,
a
real
estate
agent
acting
on
behalf
of
Principal
Investments
Limited
(hereinafter
referred
to
as
Principal),
a
company
extremely
active
in
shopping
centre
developments
from
1953
forward,
approached
the
appellant
with
an
offer
to
purchase
the
appellant’s
centre
which
was
summarily
rejected.
Cousens
repeated
his
offer
again
in
December
1955
and
was
again
refused.
In
March
1956
another
real
estate
agent,
acting
on
behalf
of
Ecclestone,
a
building
contractor,
attempted
to
buy
the
appellant’s
shopping
centre
and
was
refused.
Ecclestone
thereupon
built
on
another
site
far
removed
from
that
of
the
appellant.
Again
in
March
1956
a
real
estate
agent
named
Casey
made
an
offer
to
purchase
the
appellant’s
centre.
The
appellant
informed
the
agent
it
was
not
interested
and
turned
him
down.
Cousens,
on
behalf
of
his
principal,
persisted
in
his
efforts
to
acquire
the
centre
calling
on
the
appellant
on
frequent
occasions
throughout
January,
February
and
March
of
1956.
On
each
visit
he
was
rebuffed.
Following
one
such
refusal
to
sell
by
the
appellant,
Cousens
reported
to
Principal
and
an
officer
of
that
company
then
approached
the
president
of
Dominion
suggesting
the
appellant
was
willing
to
sell
the
centre
to
Principal
provided
Dominion
consented.
Dominion
therefore,
by
letter
dated
September
6,
1955,
Exhibit
12,
requested
clarification
from
the
appellant.
The
appellant
replied
by
letter
dated
September
8,
1955,
Exhibit
16,
advising
of
the
repeated
approaches
made
to
it
by
Cousens
and
stated
that
even
appointments
to
discuss
a
sale
were
emphatically
declined.
The
appellant
also
assured
Dominion
in
this
letter
that
no
agreement
for
sale
would
be
entered
into
without
Dominion
being
consulted
and
the
concluding
assurance
was
made
that
‘‘there
is
at
present
no
thought
of
selling’’.
In
March
1956
the
appellant’s
financial
situation
had
become
desperate.
It
was
unsuccessful
in
its
efforts
to
obtain
mortgage
financing.
Both
the
appellant
and
Eastern
had
reached
the
limit
of
their
bank
credit.
Bills
incurred
for
construction
costs
were
unpaid.
At
that
time
the
construction
costs
so
incurred
were
in
the
amount
of
$719,000
a
substantial
part
of
which
was
unpaid.
The
Bank
was
aware
that
Eastern
was
slow
in
making
many
payments
and
that
many
subcontractors
and
suppliers
of
material
were
unpaid
and
so
advised
Eastern
and
the
appellant.
Although
no
creditors
had
sued
for
payment,
nevertheless,
both
the
appellant
and
Eastern
faced
the
prospect
of
bankruptcy.
It
was
apparent
to
the
officers
of
the
appellant
and
Eastern
that
in
order
to
salvage
the
successful
and
prosperous
Eastern,
the
shopping
centre
must
be
sold.
On
March
29,
1956
the
appellant
wrote
a
letter,
Exhibit
9,
to
William
Zekendorf,
president
of
Webb
and
Knapp
Inc.
of
New
York,
a
large
real
estate
developer
which
had
extended
its
operations
into
Canada.
In
its
letter
the
appellant
stated
it
was
in
the
business
of
building
shopping
centres
throughout
Ontario
and
as
they
neared
completion,
selling
them
to
investment
firms.
Data
respecting
the
Dorwin
Shopping
Center
was
enclosed
and
the
letter
concluded
by
stating
it
was
expected
that
the
Windsor
centre
would
be
sold
within
the
month.
Such
statements
were
flagrant
puffing.
Neither
Eastern
or
the
appellant
had
constructed
any
shopping
centres
other
than
tthe
Dorwin
centre,
nor
were
any
centres
sold.
An
acknowledgment
was
received
from
William
Zekendorf
dated
April
2,
1956
expressing
interest
but
no
further
communication
was
received
from
him.
Principal
Investments
Limited
was
very
active
in
the
development
of
shopping
centres
from
1953
to
1955,
owning
eleven
which
it
had
built
during
this
period.
This
company
was
particularly
anxious
to
obtain
a
shopping
centre
in
the
Windsor
area
and
concluded
that
the
site
of
the
appellant
was
the
most
desirable
one.
Principal
looked
at
land
across
the
road
from
the
appellant’s
centre,
but
concluded
it
would
be
more
advantageous
to
purchase
the
appellant’s
centre
than
to
build
on
its
own
account
thereby
eliminating
a
competitor.
The
anxiety
of
Principal
to
acquire
the
appellant’s
centre
was
obvious
from
the
efforts
of
Cousens,
the
real
estate
agent
it
employed
for
this
purpose.
Accordingly,
the
appellant
having
decided
to
sell,
T.
C.
Odette
visited
Principal
at
its
office
in
Toronto,
Ontario,
to
negotiate
the
sale
of
the
shopping
centre.
He
took
with
him
a
draft
offer
of
purchase
in
which
a
great
many
particulars
were
incomplete
and
were
dependent
on
negotiation
on
which
T.
C.
Odette
described
the
appellant’s
position
as
being
flexible.
The
draft
offer
was
left
and
after
an
exchange
of
correspondence
with
the
legal
department
of
Principal,
L.
L.
Odette
Jr.
went
to
Toronto
on
either
April
25
or
26,
1956
to
discuss
and
complete
an
offer
for
purchase.
The
offer
was
completed
by
Principal
and
accepted
by
the
appellant
on
April
28,
1956.
A
copy
of
the
offer
to
purchase
was
introduced
in
evidence
as
Exhibit
10
and
provided
for
a
purchase
price
of
$1,500,000,
a
deposit
of
$50,000
to
be
made
forthwith,
$700,000
in
cash
on
the
closing
date
of
June
15,
1956,
and
the
balance
of
$750,000
to
be
secured
by
a
second
mortgage
on
the
developed
land,
being
the
600
ft.
shopping
centre
and
a
first
mortgage
on
the
undeveloped
land
of
the
shopping
centre
site,
with
interest
at
5
per
cent.
The
offer
also
included
a
provision
for
extending
the
time
for
closing
and
an
assignment
of
all
existing
leases.
The
appellant
undertook
to
negotiate
and
execute
further
leases
on
behalf
of
Principal.
All
leases
of
units
in
the
premises,
as
outlined
in
Exhibit
11,
were
negotiated
by
the
appellant,
but
Principal
did
renegotiate
a
lease
with
Tamblyn
Drug
Store
for
a
longer
term.
Principal
did
not
close
the
transaction
on
June
15,
1956
as
covenanted,
expressing
the
wish
to
abandon
the
purchase
and
forego
its
$50,000
deposit.
The
appellant,
however,
was
adamant
in
its
anxiety
to
sell
with
the
result
that
a
further
deposit
of
$50,000
was
made
and
instead
of
a
$750,000
mortgage,
the
appellant
took
mortgages
for
$1,000,000
at
5
per
cent,
a
$600,000
second
mortgage
on
the
developed
land
and
a
$400,000
first
mortgage
on
the
undeveloped
land.
The
eventual
closing
date
of
the
sale
was
November
1,
1956.
It
was
agreed
among
the
appellant,
Principal
and
Cousens
that
the
appellant
would
pay
Cousens
a
real
estate
commission
of
$30,000.
As
shown
in
Exhibit
8,
the
costs
incurred
by
Eastern
on
behalf
of
the
appellant
for
construction
of
the
centre
amounted
to
$851,626.94.
The
contract
of
sale
with
Principal
was
for
the
centre
with
all
store
units
fully
finished
which
accounts
for
the
ultimate
cost
of
construction
being
in
the
approximate
amount
of
$1,000,000.
The
centre
was
formally
opened
on
June
1,
1956
and
the
sale
to
Principal
was
not
consummated
until
November
1,
1956.
Therefore,
the
appellant
received
rent
from
the
tenants
during
that
interval.
The
vice-president
of
Principal
testified
that
in
the
year
1958
the
gross
income
from
the
centre
was
$141,840
with
operating
expenses
of
approximately
$25,000
leaving
a
net
income
of
$116,800
without
provision
for
mortgage
payments
or
depreciation.
There
were
always
a
few
vacancies
in
the
centre.
The
question
to
be
determined
on
the
facts
outlined
is
whether
the
profit
of
$424,035.23
realized
by
the
appellant
on
the
sale
of
its
shopping
centre
was
income
within
the
meaning
of
Sections
3
and
4
of
the
Income
Tax
Act.
The
appellant
was
certainly
not
in
the
business
of
dealing
in
real
estate
in
the
ordinary
meaning
of
the
term
‘‘business’’.
Accordingly
the
question
remains
whether
the
appellant,
by
its
actions,
was
within
the
meaning
of
‘‘business’’
as
defined
by
Section
139(1)(e)
an
that
it
was
engaged
in
‘‘an
adventure
or
concern
in
the
nature
of
trade’’
and
whether
its
profit
was
a
profit
from
such
an
adventure
as
contended
by
the
Minister
or
whether
the
amount
so
realized
by
the
appellant
was
merely
an
enhanced
value
received
upon
the
sale
of
a
capital
asset
or
an
investment
as
contended
by
the
appellant.
I
have
had
no
hesitation
in
concluding
that
the
appellant
was
not
in
the
business
of
dealing
in
real
estate.
I
do
not
consider
the
offers
of
free
land
to
department
stores,
nor
the
possible
sale
of
land
for
the
erection
of
an
office
building
as
significant,
firstly,
because
no
sale
or
gift
was
made
and
secondly,
the
appellant’s
willingness
to
sell
a
portion
of
the
land
was
dictated
by
the
necessity
of
obtaining
money
therefrom
and
the
presence
of
an
office
building
and
a
department
store
would
increase
the
attractiveness
of
the
property
as
security
for
a
mortgage
loan.
Furthermore,
I
dismiss
the
offer
to
sell
to
Webb
and
Knapp
as
being
without
significance
because
the
statements
made
by
the
appellant
were
wholly
untrue
and
exaggerated
and
were
made
for
the
purpose
of
stimulating
the
interest
of
the
recipient
and
was
prompted
by
the
desperation
of
the
appellant.
From
the
facts,
as
above
outlined,
I
am
convinced
that
at
the
time
of
the
acquisition
of
the
land
the
appellant
did
not
have
the
intention
of
turning
it
to
account
by
profitable
resale,
but
rather
that
the
appellant
sought
to
create
a
capital
asset
from
which
to
realize
rental
income.
The
appellant
did
derive
rental
income
from
the
centre
during
the
period
between
June
1,
1956,
the
date
of
the
opening
of
the
centre,
and
November
1,
1956,
the
date
upon
which
the
sale
to
Principal.
was
finally
closed,
although
the
appellant
received
rental
income
by
reason
of
Principal’s
inability
to
close
the
transaction
at
an
earlier
date
as
agreed.
There
is
no
doubt
that
the
Dominion
food
market
on
the
site
was
a
successful
venture,
the
success
of
which
Dominion
wished
to
still
further
increase
by
the
addition
of
a
shopping
centre.
Eastern
was
favourably
known
to
Dominion
as
a
building
contractor,
having
undertaken
several
works
on
its
behalf,
and
it
was
a
logical
consequence
that
the
suggestion
of
building
a
shopping
centre
should
have
been
made
by
Dominion
to
Eastern.
In
my
view
the
Odettes,
as
officers
and
directors
of
Eastern
and
prospective
officers
and
directors
of
the
appellant
and
successful
and
experienced
businessmen,
were
justified
in
undertaking
construction
of
Wing
A,
the
initial
phase
of
the
shopping
centre
and
placing
reliance
on
the
repeated
and
emphatic
oral
assurances
of
the
president,
the
most
responsible
officer,
of
Detroit
Mortgage,
that
a
first
mortgage
of
$800,00
would
be
readily
forthcoming.
It
was
reasonable
to
begin
construction
without
a
formal
written
commitment
because
such
commitments
are
not
forthcoming
in
the
trade
until
construction
has
reached
a
certain
stage
and
a
specified
percentage
of
the
space
in
the
building
has
been
leased.
It
follows
that
responsibility
for
interim
financing
and
any
attendant
risk
must
be
assumed
by
the
initiators
which
Eastern
and
the
appellant
did
assume.
In
fact
personal
financing
was
contemplated
to
the
extent
of
$200,000
at
the
outset
and
later,
when
difficulties
were
encountered,
the
appellant
was
prepared
to
double
that
amount
and
get
along
on
a
mortgage
for
$600,000
rather
than
$800,00.
Interim
financing
was
done
by
Eastern
and
the
appellant
to
the
extent
of
and
beyond
their
respective
means
and
when
the
source
of
mortgage
monies
disappeared
the
appellant
was
left
with
the
sole
recourse
of
the
sale
of
the
centre
dictated
by
the
precarious
position
in
which
the
appellant
and
Eastern
found
themselves.
On
the
positive
evidence
adduced,
I
have
no
doubt
that
in
the
latter
part
of
1955,
that
mortgage
money
was
difficult
to
obtain
and
at
the
time
when
the
appellant’s
need
was
most
urgent.
In
this
conclusion
I
am
confirmed
by
the
difficulty
which
Principal
found
in
obtaining
a
first
mortgage
to
close
the
sale
by
the
appellant
to
it
on
the
closing
date
and
found
it
necessary
to
request
an
extension
of
time
from
the
appellant
thereby
forfeiting
two
deposits
in
the
amount
of
$100,000.
The
appellant,
on
its
part,
was
anxious
to
consummate
the
sale
and
was
prepared
to
make
concessions
to
do
so
since
it
was
only
by
sale
that
the
appellant
could
extricate
itself
and
conserve
the
established
and
successful
Eastern
Construction
Limited.
It
is
my
view
that
the
agreement
by
the
appellant
to
pay
a
commission
of
$30,000
to
the
real
estate
agent,
Cousens,
was
one
of
such
concessions
so
made
by
the
appellant
to
facilitate
the
sale.
The
offer
to
purchase
dated
March
15,
1955
from
Eastern
as
purchaser
to
Dominion
as
vendor,
specifically
provided
that
the
property
should
be
developed
as
a
shopping
centre
with
Dominion
as
an
integral
part
thereof,
the
plans
being
subject
to
the
approval
of
Dominion
and
that
construction
of
the
centre
should
be
commenced
within
10
months
of
the
conveyance
of
the
land,
otherwise
the
purchaser
was
obligated
to
offer
the
land
to
the
vendor
for
repurchase.
These
stringent
provisions
convince
me
that
Dominion
sought
to
ensure
that
a
shopping
centre
would
be
built
forthwith
and
that
the
provisions
were
also
designed
to
preclude
speculation
in
the
land.
The
appellant
accepted
the
land
fully
aware
of
the
conditions
imposed
and
conscientiously
sought
to
fulfil
them.
It
is
also
my
view
that
the
high
quality
of
construction
incorporated
in
the
building
by
‘the
appellant
is
indicative
of
an
intention
to
retain
the
building
as
its
own
rather
than
for
resale
because
I
am
satisfied
that
on
sale
the
cost
of
the
built-in
quality
would
not
be
reflected
in
the
sale
price
commensurate
with
the
cost
thereof.
If
sale
had
been
contemplated
corners
could
have
been
cut
without
a
corresponding
diminution
in
the
sale
price.
The
appellant,
through
its
officers
and
directors,
thoroughly
investigated
the
possible
yield
from
a
shopping
centre
on
this
particular
site
and
were
impressed
thereby.
That
its
impressions
were
sound
has
been
proven
by
subsequent
events.
The
centre
has
been
profitable.
While
a
much
more
ambitious
project
was
first
contemplated
complete
with
a
department
store,
with
even
greater
possibilities
for
more
substantial
returns,
nevertheless,
the
less
pretentious
undertaking
has
been
a
success
yielding
a
reasonable
return.
The
cumulative
effect
of
the
foregoing
facts
leads
me
to
the
conclusion
that
the
appellant
was
not
engaged
in
an
adventure
or
concern
in
the
nature
of
trade
and
that
the
profit
realized
by
the
appellant
on
the
sale
of
its
shopping
centre
did
not
constitute
11
a
gain
made
in
an
operation
of
business
in
carrying
out
a
scheme
for
profit-making
’
’
within
the
meaning
of
that
expression
as
used
by
the
Lord
Justice
Clerk
in
Californian
Copper
Syndicate
(Limited
and
Reduced)
v.
Harris
(1904),
5
T.C.
159.
I
do
not
regard
the
situation
as
one
in
which
it
should
be
inferred
that
the
appellant
purchased
the
land
and
built
the
shopping
centre
upon
it
as
a
speculation
looking
to
resale
or
that
it
was
intended
to
turn
the
property
to
account
by
any
method
whatsoever
as
might
be
expedient
although
as
events
turned
out
that
is
what
the
appellant
found
it
necessary
to
do.
As
I
have
previously
stated,
it
is
my
view
that
the
appellant
sought
to
create
and
did
create
a
capital
asset
which
it
disposed
of
at
a
profit.
I
find,
therefore,
that
the
appellant
was
not
engaged
in
an
adventure
or
concern
in
the
nature
of
trade
and
the
profit
made
by
it
on
the
sale
of
its
shopping
centre
was
not
income
within
the
meaning
of
Sections
3,
4
and
139(1)(e)
of
the
Act.
The
Minister
was,
therefore,
wrong
in
assessing
the
appellant
as
he
did
and
its
appeal
against
the
assessments
must
be
allowed
with
costs,
Judgment
accordingly.
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