Citation: 2008TCC98
Date: 20080306
Docket: 2007-3518(IT)I
BETWEEN:
VÉRONIQUE GRIMARD,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH
TRANSLATION]
REASONS FOR JUDGMENT
Tardif J.
[1] This is an appeal
from a notice of redetermination under the Income Tax Act ("the Act")
concerning the Canada Child Tax Benefit for the 2005 base taxation year.
[2] The issue is
whether the Minister of National Revenue ("the Minister") correctly
concluded that the Appellant was not the parent who primarily fulfilled the
responsibility for the care and upbringing of her children Daphnée and Alexia
during the period of July and August 2006, in respect of the
2005 base taxation year.
[3] In making and
confirming the Canada Child Tax Benefit redetermination dated December 13, 2006 for the 2005 base
taxation year, the Minister made the following assumptions of fact:
[TRANSLATION]
(a) The Appellant and Pascal Pelletier are the
parents of the following children:
(i) Daphnée, born on August 3, 1998;
(ii) Alexia, born on June 29, 2001.
(b) Prior to the period in issue, the Appellant was
always considered the parent who primarily fulfilled the responsibility for the
care and upbringing of her children.
(c) Pascal Pelletier applied for the Canada
Child Tax Benefit in respect of his daughters Daphnée and Alexia, alleging that
they had lived with him from June 26 to August 27, 2006 and had then
resumed living with the Appellant.
(d) Without checking, the Minister made the
adjustment on December 13, 2006, determining that the Appellant was not the eligible individual in
respect of her children Daphnée and Alexia for the period of July and
August 2006.
(e) At the objection stage, the Minister sent the Appellant
and Pascal Pelletier a questionnaire to complete for the period of
June 26 to August 27, 2006 to determine which of them was the parent
eligible to receive tax benefits in respect of Daphnée and Alexia.
(f) According to the information provided by both
parties, the children lived with Pascal Pelletier during the summer for a
period equal to 41 out of 61 days.
(g) Pascal Pelletier also demonstrated that he
attended to the care and upbringing of his children during the period in issue:
(i) he registered his children in a summer camp
for eight (8) weeks;
(ii) he accompanied his children on three outings
that were part of the summer camp activities;
(iii) he accompanied his daughter Daphnée to a
podiatric clinic.
[4] After discussing
the matter, the parties agreed that the proceedings would be limited to the
statement of their respective arguments, given that the outcome of the case
basically depends on the interpretation to be given to the judgment rendered on
February 23, 2006 by the Honourable Suzanne Mireault of the Quebec
Superior Court, the relevant part of which reads as follows:
[TRANSLATION]
[11] GRANTS the
defendant access to his children during the summer as follows:
- the entire summer,
except the periods granted below to the plaintiff;
[5] To begin with, when
parents of minor children are involved in their care, upbringing and custody,
it seems to me that it is extremely difficult for the parties to establish on a
balance of probabilities that one of them behaves better than the other or is
more fit than the other.
[6] This is a very
complex debate, and the Superior Court has much better resources for conducting
it than this Court; moreover, the participants in the Superior Court's
proceedings are generally more qualified to draw conclusions, especially
concerning the best interests of minor children.
[7] In this case, the
Court must answer the following question: does the fact that the father was
granted special access during the summer, specifically 41 out of a total
of 61 days, with the Appellant having the other 20 days, mean that
the Appellant lost her status as the eligible parent and the father became the
eligible parent for that short period?
[8] The parties
supported their respective arguments with case law.
·
The Respondent
relied on the following decisions:
Matte v. Canada, [2003] F.C.J. No. 43
Landry v. Canada, [2007] A.C.I. no
287
Walsh v. Canada, [2001] T.C.J. No. 11
·
The Appellant
referred to the following decisions:
Ginette
Lefebvre v. The Queen, 2006 TCC 79
Michelle Lapierre v. La
Reine,
2005 CCI 720
Diane Bergeron v. The
Queen,
2006 TCC 81
S. R. v. Her Majesty the
Queen,
2003-602(IT)I, 2003 TCC 649
[9] Stressing the fact
that Matte v. Canada, supra, was the only one of these decisions
rendered by the Federal Court of Appeal, the Respondent basically argued that
the residence criterion is determinative; in other words, the Respondent
submitted that this is a quantitative issue: if the minor child lives with one
parent most of the time in a month, that parent is entitled to the benefits,
provided, of course, that the parent in question satisfies the other criterion,
namely caring for the child.
[10] The Respondent
relied, inter alia, on the following passages:
5 We are of the view that the Marshall case is distinguishable and that there is no legal barrier
to a non‑custodial parent being considered to be the "eligible
individual" for a period as short as one month as requested here.
. . .
7 It is important to note that
this definition clearly contemplates that the "eligible individual"
may change from time to time, as long as at the relevant time he or she is
primarily fulfilling the responsibility of a caregiver. This is indicated by
the words "at any time means a person who at that time..."
in the opening words of the definition.
. . .
9 We understand this to mean that the minimum benefit period is
one month and that a month of benefits is to be paid to whomever was the
eligible individual at the beginning of the month: that is, to the person who
was primarily fulfilling the responsibility for the care and upbringing of the child
or children at that time. It is merely an administrative convenience to pay the
whole month's benefit to the person acting as caregiver as of the first of the
month. In this way it is not necessary to do per diem calculations
because of a change of caregiver sometime during the month. Nor is it necessary
that changes in caregivers must occur only in strict correspondence with
calendar months. Otherwise in a case like this neither parent would have been
able to claim for August: the mother's caregiving apparently only covered half
of that calendar month so she could not claim, and the father could not claim
as he was not the caregiver on August 1 as required by the terms of
subsection 122.61(1).
. . .
11 We also understand the later decision of Bowman T.C.J. in Armstrong
(supra) not to have been inconsistent with Marshall. Firstly, he concluded that a family
law award of custody to one parent did not preclude the other parent from
meeting the requirements of section 122.6 of the Employment Insurance
Act when the children were actually in that other parent's care. His case
involved only one caregiver at a time. Secondly, he found that a
determination of who is the caregiver must be made on a minimum of a monthly
basis. He was able to conclude on the evidence that as the non‑custodial
parent had in fact had the primary responsibility for the children's care for
the months of July and August, 1996, she was entitled to the benefit for
that period.
12 We are therefore of the view that the Tax Court Judge erred here in
finding as a matter of law that the applicant mother, the non‑custodial
parent, could not be eligible for the child tax benefit for the month of
August, 1998 as requested, because her former partner was at other times
of the year the "eligible individual".
13 Unfortunately as a result of this conclusion of law, the Tax Court Judge
made no finding as to whether the applicant was in fact the "eligible
individual" as of August 1, 1998. We are of the view that we can make
such a determination as a matter of law by relying on a statutory presumption
to this effect. It is not in dispute that the children were residing with the
applicant on August 1,
1998.
Section 122.6, in its definition of "eligible individual",
provides as follows:
(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 122.6 eligible individual (f)
does not apply in prescribed circumstances, and...
Although it was suggested by
counsel for the respondent that this presumption would not apply because of an
exception prescribed in paragraph 6301(1)(d), of the Regulations, there
was nothing in the record to establish that the conditions which would trigger
that exception actually existed in this case. We are thus at liberty to apply
this presumption as a matter of law.
14 Therefore we conclude that the Trial Judge erred in law in his interpretation
of the definition of "eligible individual" and we will set aside his
decision affirming the Minister's assessment. We are applying the presumption
that, as the children were (it is admitted) qualified dependants and resided
with the applicant on August 1, 1998, she is deemed to have been the
"eligible individual" on that date and entitled to the Child Tax
Benefit for the month of August, 1998. The matter will be referred back to
the Minister for reassessment accordingly.
. . .
[11] In Walsh v.
Canada, the Honourable Rowe stated the following at paragraph 12:
12 In the within appeal, there
is no doubt the appellant was extremely concerned about the ongoing welfare of
her children and that she expended a great deal of time and energy in maintaining
close contact during the period under appeal even though she resided in a
community 180 kilometres from where her children were living with their
father. She spent a great deal of time with them and they stayed with her at
her residence in Dawson Creek three weekends a month - weather permitting - and for
longer periods during a long weekend and over the Christmas holiday. She
remained involved with their schooling, recreation and other related activities
and was still concerned with arranging their counselling and/or communicating
with the family physician. She also expended her own funds in connection with
activities of the children carried out in Tumbler Ridge and attended events
there even though the trip from Dawson Creek and back involved at least a three‑hour
drive under good road conditions. However, when one examines the criteria set
forth in Regulation 6302, there is no doubt that the father of the
children - Bradley Walsh - provided the primary residence for
the children, as designated by the Court Order - Exhibit A‑1.
In addition, he was primarily responsible for the maintenance of a secure
environment in which the children resided and would have been required to carry
out the supervision of the daily activities of the children and to attend to
their hygienic needs on a regular basis as well as arrange for the
transportation to school and athletic and other activities as contemplated by
the wording of the Regulations taken as a whole. The children spent the
majority of their time with their father and the provision of the Act
relates to a quantitative measurement of time rather than a qualitative
assessment of the capabilities of both parents in carrying out certain
functions set forth in Regulation 6302. Certainly, the appellant
was an important part of the ongoing process of caring for the children and
they were very fortunate to have had such a dedicated mother despite the
difficulties posed by her economic situation and the distance from the site of
her employment and residence from Tumbler Ridge. She is to be commended for her
efforts in obtaining additional education which permitted her to secure
employment suitable for caring for her children on a permanent basis. However,
on the evidence, I cannot find the Minister was incorrect in determining that
Bradley Walsh - the appellant’s husband - during the period under
appeal was the eligible individual pursuant to section 122.6 of the Act.
The appellant carried the burden of establishing her entitlement on a balance
of probabilities. In recent times, joint or shared custody has become quite
common, especially with both parents working - at one or more jobs -
and there is a need for both to rely on a variety of instructors, teachers,
coaches, trainers and caregivers - apart from the school system - in
order to provide care for their children. In the recent case of Nelson v.
A.G. of Canada, 2000 D.T.C. 6556, the Federal Court of Appeal
considered the case of a taxpayer who sought the equivalent to married tax
credit even though he had made child support payments for his son and had been
allowed the resulting deduction for those amounts. . . .
[12] What emerges from
these two cases is that the quantitative aspect is indeed very important. In
particular, I note that if the child in respect of whom the tax benefits are
paid is not with the recipient parent on the first day of the month, the
recipient parent's entitlement to benefits may shift to another recipient.
[13] Such a literal
reading could lead to situations that are strange, to say the least. I
understand that it is not my role to legislate and that I need not consider the
effect of applying the statutory provisions that read as follows:
122.5 (1) The following definitions apply in this section.
. . .
"qualified dependant" of
an individual, in relation to a month specified for a taxation year, means a
person who at the beginning of the specified month
(a) is the individual's child or is
dependent for support on the individual or on the individual's cohabiting
spouse or common‑law partner;
(b) resides with the individual;
(c) is under the age of 19 years;
(d) is not an eligible individual in
relation to the specified month; and
. . .
122.6. In this subdivision,
"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,
. . .
[14] The residence
criterion is of fundamental importance. Despite the importance and especially
the impact that this concept may have, it seems that Parliament did not see fit
to define it in the legislation.
[15] I therefore rely on
what the Honourable Pierre Dussault stated in Michelle Lapierre,
supra, at paragraphs 13 and 14:
[TRANSLATION]
13. Although
residence is the basic concept used to establish liability for income tax under
the Act, that concept is not defined in the Act, and it is the
courts that have tried to determine its limits. Residence in a particular place
is basically a question of fact and is established through a number of criteria
relating to time, object, intention and continuity, which do not necessarily
always have the same importance and which may vary with the circumstances of
each case (see Thomson v. M.N.R., [1946] S.C.R. 209). However, residence
implies some constancy, regularity or permanence in a person's customary mode
of life in relation to a given place, and it differs from what may be
characterized as visiting or staying for a specific purpose or on an occasional
basis. Where the Act requires residence with another person, I do not
think it appropriate to give the verb "reside" a meaning that departs
from the concept of residence as developed by the courts. Residing with someone
means living with someone in a given place customarily or with some constancy
or regularity.
14. Indeed, the condition of "residing
with the dependant" has been analysed in this way (see, inter alia,
S.R. v. Canada, [2003] T.C.J. No. 489 (QL), Bachand v. Canada,
[2004] T.C.J. No. 26 (QL), and Boutin v. Canada, [2004] A.C.I. no 379
(QL)).
[16] Obviously, I agree
with Mr. Justice Dussault's analysis. This is a question of fact that must
be answered on a case‑by‑case basis.
[17] Parliament has also
imposed another condition for tax benefits, namely that the parent who
primarily fulfils the responsibility for the care and upbringing of the child
will be the parent who receives the benefits.
[18] Yet the care and
upbringing of a child cannot be assessed quantitatively. It is not enough to
count days or determine which parent had the child on the first day of the
month. This assessment concerns a minimum period of time and implies a certain
minimum period.
[19] Children have to go
see a pediatrician, dentist and other professionals; these may be routine
visits, but often they are more numerous when there is a specific problem, and
any follow‑up requires some continuity.
[20] Follow‑up is
also necessary during the school year, preferably through meetings with various
professionals. The same is true of extracurricular activities, not to mention
friends, the school environment and so on.
[21] The Respondent's
position is that, in theory, the eligible parent can change on the first day of
every month. I find it difficult to accept this position in relation to the
care and upbringing of a child, since stability is, without question, a
fundamental part of such care and upbringing.
[22] When custody is
shared, the competent court or the parties provide for these kinds of problems;
movements are generally organized on the basis of such problems.
[23] In the instant case,
custody is not shared, but access is broadened during the short vacation
period. When a person leaves on vacation, does the hotel where the person stays
become the person's residence?
[24] Here, I conclude
that the Appellant was the eligible parent in light of the short period of time
involved and the reason the children went to their father's home; the Appellant
still has legal custody and, above all, she has always been the parent who
primarily fulfils the responsibility for the care and upbringing of the
children.
Signed at Ottawa, Canada, this 6th day of March 2008.
"Alain Tardif"
Translation certified true
on this 30th day of April 2008.
Brian McCordick, Translator
Email this Content