ACI Properties - Tax Court finds that a second taxpayer cannot be brought into tax dispute under s. 174 where the Minister had already made up her mind

In a situation where one taxpayer (AFT) claimed that it had paid a $1.95 million amount as a deductible management fee and the recipient (ACI) claimed that it was a capital receipt, CRA decided in favour of the management fee characterization and reassessed ACI accordingly (although it also obtained a waiver from AFT).

Bocock J found that the Minister was precluded from bringing an application approximately five years later under s. 174 for a determination in relation to both AFT and ACI as to the amount's characterization.  A s. 174 application is required to be brought "in relative chronological proximity" to the Minister's determination that the matter is ambiguous - whereas here, she had made up her mind five years before the application was brought.

Neal Armstrong.  Summary of ACI Properties v. The Queen, 2013 TCC 101 under s. 174.