Citation: 2005TCC268
Date:20050413
Docket: 2004-202(IT)I
BETWEEN:
GREGORY J. FLOWER,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR JUDGMENT
Bell, J.
ISSUE
[1] The issue is whether the sum
of $13,370 paid by the Appellant to Rundle College Academy (“Academy”) was “a medical
expense” within the meaning of Section 118.2 of the Income Tax Act (“Act”).
[2] More specifically, the question is whether that
amount:
a medical expense … paid, within the meaning of
Section 118.2(2)(e) for the care, or the care and training, at a school,
institution or other place of the patient, who has been certified by an
appropriately qualified person to be a person who, by reason of a physical or
mental handicap, requires the equipment, facilities or personnel specially
provided by that school, institution or other place for the care, or the care
and training, of individuals suffering from the handicap suffered by the
patient;
The
Appellant, representing himself, produced as a witness, Dr. Brent Macdonald
(“Macdonald”). He, during the period in question, was an associate principal
and school psychologist at the Academy. He stated that he is a psychologist,
has experience in learning disability assessments, has a master’s degree in school
psychology and a Ph.d. in applied psychology. He said further that he worked at
learning disabilities for ten years.
[3] He testified that any student at the Academy must have
the designation of a learning disability, this usually being determined by a
psychologist. He assessed the Appellant’s two sons in the fall of 2001. He said
that the results of his assessment of them, K and Z, indicated they had
learning disabilities.
[4] He stated that K was in grade five but could read only
at the grade three level. He said that the public school system had put him at
that level and he was unable to deal with it. He described a learning
disability, attributed to K, as a “life long condition”. He said that such
condition is treatable and that there are many strategies for same. He spoke of
the goal being to maximize one’s potential even if there was a significant
difference between intellectual ability and academic skill. He described K as a
student with a strong desire to read and said that he had a passionate, high
interest so to do.
[5] He said that Z, in grade eight, was assessed in the
same fashion and assessed with the same result. He stated that Z showed average
to above average intellectual ability but a lower level of academic
performance. He testified that this grade eight student had the academic skills
of grade five or grade six level.
[6] Macdonald also stated that Z and K had access to a
helpful software program. He said that both boys had responded well and that Z
accepted extra help in a positive way and that K feared academics but, had
gained confidence and displayed improvements. He explained the difference
between remediation education, which involved taking away the curriculum and
working with the student, and an accommodation education, in which the
curriculum was the same but the manner of delivery and assessing was changed, for
example, extra time given for assignments, reading the text to students and
examinations on tape or with the assistance of scribes.
[7] Macdonald described K as being more geared to remedial
instruction and spoke of, for example, his ability to understand concepts but
not to be able to read about them. The accommodation included books on tape to
help him read and also working separately with him. He described the
improvement in K’s reading ability but rather static condition respecting
written expression.
[8] Macdonald then described Z as being given double time
to write tests, using books on tape, the general focus being accommodation instead
of remedial.
[9] Generally, he said that all children would benefit
from smaller classes and lower teacher-student ratios.
[10] Macdonald stated clearly that he was not a medical
practitioner but that the data collected strongly indicated the presence of
learning disability with respect to the two boys. He also said that there were
four independent schools in Calgary similar
to the Academy and that they were all over subscribed.
[11] The Appellant gave evidence with respect to one of the
Respondent’s stated facts in the Reply to the Notice of Appeal which reads,
the Appellants
reason for enrolling both (Z) and (K) at the College is that both (Z) and (K)
do not perform to their assessed intellectual abilities in certain areas;
The
Appellant stated that the reason to enroll them was that they had learning
disabilities and not because they were not performing to their “assessed
intellectual abilities”. He submitted that the boys had a “mental handicap”
which was not defined in the Act and that they were suffering from
physical or mental disabilities. He said that the boys were falling behind in
public school, that he recognized the need to intervene and that they needed
special facilities, equipment and care. He submitted that Macdonald had
“certified” that both Z and K had learning disabilities requiring the Academy’s
facilities. He also said that he had never intended to apply for the credit but
that a chartered accountant had told him to do so.
[12] Respondent’s counsel referred to the above wording in
Section 118.2 referring specifically to “medical expense” and “amount paid” for
“care” or “care and training”. He submitted that the word “care” must be read
in context.
[13] He referred to Section 118.2 of the Income Tax Act (“Act”)
under which a taxpayer is permitted to deduct a formula determined amount, one
of the components thereof being the “individual’s medical expenses”. Subsection
(2) states that, for that purpose, a medical expense of an individual is an
amount paid…
(e) for the
care, or the care and training, at a school, institution or other place of the
patient, who has been certified by an appropriately qualified person to be a
person who, by reason of a physical or mental handicap, requires the equipment,
facilities or personnel specially provided by that school, institution or other
place for the care, or the care and training, of individuals suffering from the
handicap suffered by the patient;
He referred to entries
printed from Oxford English Dictionary Online. The first of these
defined the word “medical”, inter alia, as:
Characteristic
of or appropriate for a doctor or other medical practitioner.
and:
Of, relating
to, or designating the science or practice of medicine in general…
One
of the meanings of “medicine” was:
The science or
practice of the diagnosis, treatment, and prevention of disease…
The
word “treatment” was defined, partially, as:
Management in
the application of remedies; medical or surgical application or service.
One
of the definitions of the word “care” included under a heading described as
“DRAFT ADDITIONS JUNE 2001” read:
The attention
and treatment given to a patient by a doctor or other health worker.
The
word “patient” from the online dictionary was defined, in part, as follows:
One who is
under medical treatment for the cure of some disease or wound; one of the sick
persons whom a medical man attends; an inmate of an infirmary or hospital.
In
referring to that dictionary’s meaning of “mental”, Respondent’s counsel read
the
following passage:
… mental
handicap, a condition in which the intellectual capacity of a person is
permanently lowered or underdeveloped to a degree that prevents normal function
in society (the term is now increasingly avoided).
[14] Counsel submitted that “care” had to be specific to
“medical” as opposed to nurturing. He also said that the word “patient” was
coloured by the surrounding words. Counsel referred to Anka v. HMQ,
[1995] T.C.J. No. 1493 in which Bonner, J. of this Court said that services,
respecting a child with speech and language problems who had been enrolled in
nursery schools, an elementary school, in summer courses and in swimming and
ballet lessons, did not fall, so far as tuition was concerned, within the ambit
of the above quoted section. He said:
I can find no
merit whatever in this contention. Nothing in the evidence suggests that the
child received as a patient either at nursery school or at elementary school
anything remotely resembling either care or care and training or that any
amount was paid for any such thing. What was paid to the nursery
school was tuition. What was received at all schools was education,
albeit education tailored to fit the child's special needs. Even if,
contrary to my view, the words "equipment, facilities or personnel
specially provided by the school" are elastic enough to cover audio-visual
and printed material dealing with the proper response to language problems they
cannot be said to be provided for the care or care and training of children
with language problems within the meaning of paragraph (e). The
statutory language must be interpreted in context. It must be
remembered that the words "care or care and training" are used in the
context of a definition of a medical expense and they take colour from that
context.
This decision was upheld by the Federal Court of Appeal.
[1997] DTC 5290
[15] I am entirely in accord with the submissions of Respondent’s
counsel and of the words of Bonner, J. quoted above. The words, appearing in
Section 118.2(2)(e), namely, “care and training”, “place of the
patient”, “physical or mental handicap”, “institution or other place for … care
and training … of individuals suffering from the handicap suffered by the
patient” all indicate to me that the context in which an expenditure must be
analyzed is a medical context. That is not the case here. The boys were
attending an institution where special assistance was given. The evidence
indicates that there were a number of such institutions in the family’s city.
There is no evidence supporting a conclusion that the institution could be
construed as would be necessary for it to fall within the medical context of
the words in paragraph (e). While I have no doubt the boys needed the
assistance that they received and profited from it, there is no legislation in
the Act which permits a credit or deduction in respect of such
assistance.
[16] Accordingly, the appeal will be dismissed.
Signed at Ottawa, Canada, this 13th
day of April, 2005.
“R.D. Bell”
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