Chen – Federal Court of Appeal follows Cheema regarding purchasers including those with no beneficial entitlements

In order to satisfy lender requirements, the agreement for the purchase by Ms. Chen of a new home added her two (unrelated) godparents as named purchasers. LeBlanc JA found that their addition meant that the purchase did not qualify for the new housing rebate given that, prior to a 2021 amendment to s. 262(3), every purchaser of a new home was required to be acquiring for own occupation or to be related to such an occupier. In this regard, he referred to Cheema as standing for the proposition that:

The fact that someone was acquiring a new house only as a trustee and with no beneficial interests in the property was of no consequence; there was no exception for trustees … . What mattered at the time … was “the relationship of the person acquiring the [house] to the builder—one of purchase and sale—[…], not the relationship between co-purchasers” ... .

He further stated:

[T]he principle of horizontal stare decisis … dictates that decisions of a panel of an appellate court bind future panels of that court … .

It is only in “exceptional circumstances” that the Court will overrule the decision of another panel. This will generally occur when “the previous decision is manifestly wrong, in the sense that the Court overlooked a relevant statutory provision, or a case that ought to have been followed” … .

Cheema, which seems to suggest that a named purchaser is the recipient of a supply of property even where it has no entitlement to acquire beneficial ownership, is here to stay.

Neal Armstrong. Summaries of Chen v. Canada, 2023 FCA 146 under ETA s. 254(2)(b) and General Concepts – stare decisis.