Date:
20020924
Docket:
2001-4634-IT-I
BETWEEN:
KELLY
GARRETT,
Appellant,
and
HER MAJESTY
THE QUEEN,
Respondent.
Reasons
for Judgment
Angers,
J.T.C.C.
[1]
This appeal under the informal procedure was heard in Edmundston,
New Brunswick, on August 21, 2002. The Appellant is
appealing a determination of child tax benefit dated February 20,
2001, wherein the Minister of National Revenue (the
"Minister") assessed the Appellant for an overpayment
of $633.30 for the 1996 base taxation year and of $2,533.20 for
the 1997 base taxation year. The issue is whether the Appellant
was the eligible individual in respect of the qualified
dependants-her sons Brandon Roy, born January 11, 1988, and Mason
Roy, born May 24, 1990-for the months of May and June 1998 for
the 1996 base taxation year and from July 1998 to January 1999
and for May 1999 for base taxation year 1997.
[2]
At the end of the trial, it became clear from the evidence that
although the child tax benefit cheques were made out to the
Appellant and sent to her address, the benefits were used by the
eligible individual, namely the children's father and the
Appellant's husband, Eric Roy, who had the children with him.
As a result, counsel for the Respondent agreed that the
overpayment of $633.30 for May and June 1998 with respect to base
taxation year 1996 and of $316.65 for the month of July 1998 with
respect to base taxation year 1997 need not be reimbursed by the
Appellant as the benefits were used by the eligible individual,
Eric Roy. It is therefore so ordered. The remaining period in
issue thus relates to base taxation year 1997 and comprises the
months of August 1998 to January 1999 and May of 1999.
[3]
The Appellant and her husband separated on April 15, 1998. The
Appellant left the matrimonial home and both qualified dependants
remained there with their father. In July and August of that
year, the Appellant and her husband shared custody of their
children. The arrangement was that each parent would have the
children for periods of two weeks at a time. In September of
1998, both children resided with their father until a
disagreement occurred between the latter and the elder son who,
as a result, moved in with his mother on the eighth of that
month.
[4]
The Appellant testified that, in November of the same year, her
former husband lost his job and her younger son moved in with
her. Both children resided with her until a final custody order
dated September 20, 1999 granted her former husband legal custody
of both qualified dependants. Prior to that final custody order,
an interim order made on May 4, 1999 had granted the Appellant
custody of both qualified dependants. The Appellant has been
assessed for overpayments posterior to May 4, 1999.
[5]
Her former husband, Eric Roy, testified that it was only in
February 1999 that he lost his job and that it was from that time
that they shared custody and that each had the children for
periods of one week at a time. That arrangement lasted until the
interim custody order of May 4, 1999, when he moved to another
location. As for his son Brandon, Eric Roy acknowledged that he
moved in with his mother on September 8, 1998 but added that he
returned to live with him on December 1, 1998. To aid
his memory, Eric Roy noted on a calendar where his children were
staying. These notes identify the time spent by both children
with each parent during the periods in issue.
[6]
The Appellant applied for child tax benefits in March of 1999. In
that application, she indicated the Respondent that both children
had started living with her on February 20, 1999 and that the
explanation for the change was a custody battle. She further
stated that she and Eric Roy were sharing custody at that time
and that the children were spending one week with her and one
week with their father. The date of the application is consistent
with the evidence of Eric Roy as to the time he lost his job and
the time that he would have asked the Appellant to share custody
and care for the children on a more regular basis. His
recollection of these events seems more accurate and I
accordingly accept his version.
[7]
The Appellant, in order to receive the Canada Child Tax Benefit,
must prove on a balance of probabilities that she was the
eligible individual for the periods in issue. Section 122.6 of
the Income Tax Act (the "Act") defines
"eligible individual" as follows:
"eligible individual" - "eligible
individual" in respect of a qualified dependant at any time
means a person who at that time
(a) resides with the qualified dependant,
(b)
is the parent of the qualified dependant who primarily fulfils
the responsibility for the care and upbringing of the qualified
dependant,
(c)
is resident in Canada or, where the person is the cohabiting
spouse of a person who is deemed under subsection 250(1) to be
resident in Canada throughout the taxation year that includes
that time, was resident in Canada in any preceding taxation
year,
(d) is not described in paragraph 149(1)(a) or
(b), and
(e)
is, or whose cohabiting spouse is, a Canadian citizen or a person
who
(i) is a
permanent resident (within the meaning assigned by the
Immigration Act),
(ii) is a
visitor in Canada or the holder of a permit in Canada (within the
meanings assigned by the Immigration Act) who was resident
in Canada throughout the 18 month period preceding that time,
or
(iii) was
determined before that time under the Immigration Act, or
regulations made under that Act, to be a Convention
refugee,
and for
the purposes of this definition,
(f)
where the qualified dependant resides with the dependant's
female parent, the parent who primarily fulfils the
responsibility for the care and upbringing of the qualified
dependant is presumed to be the female parent,
(g)
the presumption referred to in paragraph (f) does not
apply in prescribed circumstances, and
(h)
prescribed factors shall be considered in determining what
constitutes care and upbringing.
[8]
Section 6302 of the Income Tax Regulations (the
"Regulations"), which appears in Part LXIII of
those Regulations, prescribes the factors to be considered
in determining what constitutes care and upbringing of a
qualified dependant. Section 6302 reads as follows:
FACTORS
6302. For the
purposes of paragraph (h) of the definition "eligible
individual" in section 122.6 of the Act, the following
factors are to be considered in determining what constitutes care
and upbringing of a qualified dependant:
(a)
the supervision of the daily activities and needs of the
qualified dependant;
(b)
the maintenance of a secure environment in which the qualified
dependant resides;
(c)
the arrangement of, and transportation to, medical care at
regular intervals and as required for the qualified
dependant;
(d)
the arrangement of, participation in, and transportation to,
educational, recreational, athletic or similar activities in
respect of the qualified dependant;
(e)
the attendance to the needs of the qualified dependant when the
qualified dependant is ill or otherwise in need of the attendance
of another person;
(f)
the attendance to the hygienic needs of the qualified dependant
on a regular basis;
(g)
the provision, generally, of guidance and companionship to the
qualified dependant; and
(h)
the existence of a court order in respect of the qualified
dependant that is valid in the jurisdiction in which the
qualified dependant resides.
[9]
Both children in this case are qualified dependants. They were
not the subject of any court order respecting custody during the
periods in issue, except for the order of May 4, 1999, granting
interim custody to the Appellant. The father acknowledges in
Exhibit R-4 that, in May 1999, one of the months in issue, the
children were both living with their mother. No other evidence
was presented regarding that month that might assist me in
considering the other factors prescribed by regulation. Since
they were at that time residing with the Appellant and were the
subject of a custody order, I find that the Appellant was the
eligible individual for the month of May 1999.
[10] As for the
period from August 1998 to January 1999, the Appellant was able
to establish that she was the eligible individual with regard to
her son Brandon only for the months of September, October and
November 1998, as he lived and resided with her during those
months. Brandon returned to live with his father on December 1,
1998. The evidence presented failed to show that there were any
changes in August 1998 or thereafter, other than the fact that
Brandon lived with his mother for the three months, referred to
above. I am thus not satisfied that the Appellant did anything to
change her status to that of eligible individual. The Appellant
acknowledged that her husband was the eligible individual for the
first months after their separation. It was only in February of
1999 that the Appellant assumed more responsibilities with
respect to her children and thereby brought herself within the
definition of eligible individual.
[11] I have no
doubt that the Appellant never stopped caring for her children at
any time but the extent of her care during the period in issue
was insufficient to meet the requirements of the definition. I
have considered the letters from the school principal submitted
by the Appellant but fail to see how the principal, who did not
testify to substantiate her conclusion, could have determined
that the Appellant was the primary caregiver.
[12] I
therefore find that the Appellant was not the eligible individual
for either qualified dependant in August and December 1998 and in
January 1999. As for September, October and November 1998, I find
that she was the eligible individual for her son Brandon only.
With respect to May 1999, I find that she was the eligible
individual for both qualified dependants. It was agreed by the
Respondent at trial that the Appellant need not reimburse any
overpayment for the months of May, June and July 1998. I
therefore allow the appeal and refer the matter back to the
Minister for redetermination on the basis set forth in these
Reasons for Judgment.
Signed at
Ottawa, Canada, this 24th day of September 2002.
J.T.C.C.COURT
FILE
NO.:
2001-4634(IT)I
STYLE OF
CAUSE:
KELLY GARRETT
and Her Majesty the Queen
PLACE OF
HEARING:
Edmundston, New Brunswick
DATE OF
HEARING:
August 21, 2002
REASONS FOR
JUDGMENT
BY:
The Honourable François Angers
DATE OF
JUDGMENT:
September 24, 2002
APPEARANCES:
For the
Appellant:
The Appellant herself
Counsel for
the
Respondent:
Claude Lamoureux
COUNSEL OF
RECORD:
For the
Appellant:
Name:
Firm:
For the
Respondent:
Morris Rosenberg
Deputy Attorney General of Canada
Ottawa, Canada
2001-4634(IT)I
BETWEEN:
KELLY
GARRETT,
Appellant,
and
HER MAJESTY
THE QUEEN,
Respondent.
Appeals
heard on August 21 2002, at Edmundston, New Brunswick,
by
the
Honourable Judge François Angers
Appearances
For the
Appellant:
The Appellant herself
Counsel for
the
Respondent:
Claude Lamoureux
JUDGMENT
The appeals from the assessments made under the Income Tax
Act for base taxation years 1996 and 1997 are allowed, and
the assessments are referred back to the Minister of National
Revenue for reconsideration and reassessment on the basis set
forth in these Reasons for Judgment.
Signed at
Ottawa, Canada, this 24th day of September 2002.
J.T.C.C.
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