Davis,
J.:—This
is
an
income
taxation
case.
The
late
Sir
William
Mackenzie
of
Toronto
died
on
December
5,
1923.
By
his
last
will
and
testament,
dated
May
20,
1909,
he
gave
and
devised
all
his
estate
unto
three
named
executors
and
trustees
upon
the
trusts
therein
mentioned
and
provided
that
his
estate
should
be
divided
ultimately
among
his
wife
and
children,
and
children
of
any
deceased
child,
as
if
he
had
died
intestate,
with
authority
to
his
executors
and
trustees
to
make
divisions
of
the
estate
from
time
to
time
when
and
as
in
their
discretion
they
should
think
suitable
having
regard
to
the
general
position
of
the
estate
and
its
future
requirements.
This
will
remained
unchanged
from
1909
until
November
14th,
1923,
at
which
time,
one
of
his
sons
named
as
an
executor
and
trustee
having
died,
Sir
William
appointed
by
codicil
two
additional
executors
and
trustees,
thereby
increasing
the
number
from
two
to
four.
The
following
day,
November
15th,
1925,
by
a
second
codicil
he
bequeathed
the
sum
of
$5,000
to
each
of
his
grandchildren
then
living.
On
November
28th,
1923,
he
made
a
third
codicil,
upon
which
the
questions
in
issue
in
this
ease
have
arisen.
This
codicil
was
as
follows:
‘“This
is
a
codicil
to
the
last
will
and
testament
of
me,
William
Mackenzie,
of
Benvenuto,
Toronto.
"WHEREAS
by
my
said
will
I
appointed
my
son
Joseph
Merry
Mackenzie
and
Sir
Edmund
Byron
Walker,
President
of
the
Canadian
Bank
of
Commerce,
to
be
two
of
the
executors
thereof,
AND
WHEREAS
by
codicil
to
my
said
will
made
on
the
fourteenth
day
of
November,
one
thousand
nine
hundred
and
twenty-three,
I
appointed
Robert
John
Fleming,
formerly
General
Manager
of
the
Toronto
Railway
Company,
and
my
son-in-law
Frank
H.
McCarthy
to
be
additional
executors
of
my
said
will
Now
I
Direct
that
my
son
Joseph
Merry
Mackenzie
shall
be
paid
Five
hundred
dollars
a
month
in
addition
to
any
sum
which
the
courts
or
other
proper
authorities
may
allow
him
in
common
with
the
other
executors.
AND
in
all
other
respects
I
confirm
my
said
will,
and
the
codicils
thereto
made.’’
Then
on
December
4th,
1923,
another
codicil
was
made
providing
for
the
use
of
the
testator
‘s
Toronto
home
by
his
daughters
upon
certain
terms
and
conditions.
The
following
day
Sir
William
died.
Joseph
M.
Mackenzie,
a
son
of
the
testator
and
one
of
the
executors
named
in
the
will,
survived
his
father
and
died
some
time
in
1932.
It
was
apparently
inconvenient
for
some
years
for
the
estate
to
pay
to
Joseph
M.
Mackenzie
the
$500
a
month
provided
by
the
third
codicil,
and
nothing
appears
to
have
been
paid
to
him
in
this
connection
until
the
5th
of
March,
1927,
when
a
lump
sum
of
$19,500
was
paid
to
him
to
cover
the
period
from
the
date
of
the
testator’s
death
to
that
date.
During
the
balance
of
the
year,
1927,
the
payments
amounted
to
$4,916.67,
making
a
total
sum
received
by
him
in
that
year
of
$24,416.67.
During
the
succeeding
years
1928,
1929,
1930
and
1931,
and
up
to
the
date
of
his
death
in
1932,
he
appears
to
have
received
his
$500
a
month.
None
of
this
money
was
reported
by
the
late
Joseph
M.
Mackenzie
in
his
income
tax
returns
upon
the
ground,
it
is
said,
that
he
treated
these
moneys
as
a
legacy
to
him.
Under
see.
3(a)
of
the
Dominion
Income
War
Tax
Act
these
moneys,
if
a
legacy
out
of
capital,
would
not
be
taxable,
because
income
as
defined
by
the
Act
excludes
the
value
of
property
acquired
by
gift
though
not
the
income
from
such
property.
The
first
question,
then,
that
arises
in
this
ease
is
whether
or
not,
as
a
matter
of
interpretation,
the
$500
a
month
directed
to
be
paid
to
the
son
was
a
legacy
or
additional
remuneration
to
him
as
an
executor
and
trustee
over
and
beyond
whatever
his
portion
might
be
of
the
compensation
which
would
be
allowed
by
the
Surrogate
Judge
to
the
executors
and
trustees
upon
the
passing
of
their
accounts.
If
it
be
determined
that
these
moneys
were
not
a
legacy
but
remuneration,
then
the
further
question
is
raised
in
this
appeal
as
to
whether
or
not
the
Department
of
National
Revenue
was
entitled
to
assess
Mr.
Mackenzie
for
the
taxation
period
1927
the
whole
of
the
sum
of
$19,500
received
by
him
on
March
5,
1927,
notwithstanding
that
$18,000
of
that
amount
represented
arrears
of
monthly
payments
that
had
fallen
due
during
the
preceding
three
years.
The
obvious
objection
to
treating
the
whole
amount
as
income
in
the
particular
year
in
which
it
was
actually
received
is
that
it
results
in
a
higher
percentage
of
taxation
upon
the
total
amount
than
could
have
been
imposed
had
the
payments
been
made
as
they
fell
due
month
by
month
during
the
preceding
years.
The
appellants,
the
executors
of
the
will
of
the
late
Joseph
M.
Mackenzie,
contend
that
if,
contrary
to
their
main
contention,
the
payments
are
not
to
be
treated
as
a
legacy
but
as
additional
remuneration,
then
the
assessments
should
be
revised
so
as
to
allocate
$6,000
to
each
of
the
years
in
respect
of
which
the
amounts
were
payable,
and
the
tax
levied
accordingly.
Dealing
now
with
the
first
question,
as
to
whether
or
not
the
$500
a
month
was
a
legacy
or
additional
remuneration
qua
executor.
It
is
not
unreasonable
to
assume
that
the
testator
realized,
or
that
his
attention
was
called
to
the
fact,
that
increasing
the
number
of
executors
from
two
to
four
would
necessarily.
involve
his
son
in
a
substantial
decrease
of
compensation
as
one
of
the
executors.
The
codicil
does
not:in
precise
language
say
that
the
$500
a
month
is
additional
remuneration
to
the
son
as
an
executor
but
it
is
sufficiently
definite
to
express
that
to
be
the
intention
of
the
testator.
The
words
are,
"
Whereas
.
.
,
by
codicil
.
.
I
appointed
.
.
..
additional
executors
...
Now
I
direct
that
my
son
.
.
.
shall
be
paid
Five
hundred
dollars
a
month
in
addition
to
any.
sum
which
the
courts
or
other
proper
authorities
may
allow
him
in
common
with
the
other
executors.’’
A
fair
test
to
apply
is
to
ask
oneself,
what
would
have
been
the
position
if
the
son
had
renounced
his
executorship?
Could
he
have
enforced
payment
of
this
monthly
sum
while
declining,
as
he
would
have
been
quite
free
to
do,
to
act
as
an
executor
of
his
father
‘s
will?
It
must
be
held,
I
think,
that
he
could
not.
If
that
is
so,
then
it
was
not
a
legacy
but
additional
remuneration
and
as
such
was
taxable
income.
But
should
the
total
payment
of
$19,500
have
been
assessed
in
3
respect
of
the
taxation
year
in
which
it
was
actually
received?
If
so,
it
is
apparent
that
it
works
an
injustice
to
the
taxpayer,
but
it
is
almost
inevitable
that
every
general
taxation
statute
will
in
its
application
to
some
particular
case
create
an
injustice
while
in
its
wide
application
to
normal
conditions
it
will
work
satisfactorily.
The
statute
here
by
sec.
3
defines.
income
as
"‘income
received’’
and
by
sec.
9
imposes
the
tax
upon
"‘the
income
during
the
preceding
year’’.
Unfortunately
in
this
case
the
taxpayer
is
bound
to
pay
a
larger
amount
than
could
have
been
levied
and
collected
upon
the
same
income
had
it
been
paid
in
instalments
month
by
month
as
it
became
due
and
payable,
but
that
cannot
affect
the
liability
plainly
imposed
by
the
statute.
We
were
pressed
to
apply
the
provisions
of
sec.
11
to
this
income
as
something
that
"‘accrued
to
the
credit”
of
the
taxpayer
each
month,
but
sec.
11
has
no
application
to
the
facts
of
this
case.
It
relates
only
to
income
of
a
beneficiary
of
any
estate
or
trust.
We
cannot
escape
from
the
conslusion,
which
seems
a
rather
harsh
one,
that
the
appeal
must
be
dismissed
with
costs
if
asked.
Appeal
dismissed.
(
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