Kempo
J.T.C.C.
(orally):-This
informal
procedure
appeal
concerns
Mr.
Aguilar’s
1991
taxation
year.
The
issue
concerns
the
disallowance
by
the
Minister
of
National
Revenue
of
support
payments
made
by
Mr.
Aguilar
during
November
and
December
1991.
It
is
conceded
that
these
amounts
were
actually
paid.
Mr.
Aguilar
gave
viva
voce
evidence
and
submissions
respecting
his
situation
which
basically
corroborates
the
statements
made
and
positions
taken
in
his
notice
of
appeal
dated
March
29,
1994
which
reads:
I
am
hereby
filing
an
appeal
on
the
decision
of
the
Minister
of
National
Revenue
confirming
the
assessment
of
my
1991
tax
return.
The
ground
for
my
appeal
is
the
unfair
enforcement
of
the
Income
Tax
Act,
R.S.C.
1952,
c.
148
(am.
S.C.
1970-71-72,
c.
63)
(the
"Act")
by
disallowing
deduction
of
the
payments
I
made
to
my
spouse
in
1991
just
because
of
the
late
signing
of
the
support
settlement.
The
facts
of
the
case
are
outlined
in
the
attached
document.
Facts
and
reasons
for
appeal
On
November
6,
1991
I
left
the
matrimonial
home.
Cognizant
of
the
needs
of
the
two
epileptic
children
of
the
marriage,
I
immediately
arranged
to
support
the
children
and
their
mother
by
providing
$1,600
per
month
which
I
deposited
to
a
joint
account
with
the
Bank
of
Montreal.
I
did
not
wait
for
them
to
go
to
the
courts
to
obtain
an
order.
In
1992,
I
made
several
proposals
for
a
settlement
agreement
but
none
of
them
was
accepted
by
my
spouse.
She
was,
however,
advised
by
her
lawyer
to
declare
as
income
in
her
income
tax
return
the
payments
I
was
making.
Her
1991
and
1992
returns
can
prove
that.
In
October
1993,
I
received
a
letter
from
a
J.
Chernhoski
advising
me
to
produce
documents
to
support
my
claims
otherwise
my
returns
will
be
reassessed
and
adjusted.
In
response
to
the
October
letter,
I
sent
photocopies
of
my
bank
book
showing
the
regular
payments
I
made
by
check
and
explained
that
the
nature
of
my
account
do
not
include
the
return
of
the
cancelled
checks.
I
also
provided
a
copy
of
an
affidavit
by
my
wife
which,
among
others,
acknowledged
the
payments
I
have
made
in
the
amount
of
$1,600
per
month.
Also
provided
is
a
copy
of
a
court
order
compelling
me
to
pay
$1,800
starting
November
1993.
On
November
29,
1993
I
received
a
letter
from
J.
Chernhoski
advising
me
that
the
documents
I
provided
were
not
acceptable.
The
affidavit,
according
to
the
letter,
was
not
acceptable
for
income
tax
purposes
because
I
did
not
sign
it
agreeing
to
the
payments.
The
bank
book
copies
were
not
accepted
as
receipt
and
the
court
order
was
ignored
because
it
only
compelled
me
to
start
paying
the
$1,800
per
month
on
November
1,
1993.
On
December
31,
1993
I
finally
managed
to
obtain
a
signed
agreement
with
regards
to
the
support
payments.
On
January
14,
1994
I
filed
a
notice
of
objection
with
the
Winnipeg
Taxation
Centre.
On
March
17,
1994
the
Minister
of
National
Revenue
made
a
decision
to
allow
my
support
payment
be
deducted
from
the
1992
return
but
not
on
my
1991
return.
The
reasons
for
this
appeal
are:
1.
I
believe
that
the
law’s
intent
was
not
just
limited
to
those
who
go
to
court
to
settle
support
payments
but
also
to
those
who
are
responsible
enough
to
accept
those
responsibilities.
I
could
probably
have
received
a
court
order
if
I
stopped
paying
my
spouse
but
I
did
not
choose
to
do
this
because
my
wife
would
have
used
that
to
poison
the
minds
of
my
two
children.
2.
That
the
1991
claims
be
allowed
in
spite
of
the
fact
that
the
regulations
limit
the
time
of
an
agreement
to
one
year.
Again,
the
law
would
be
unfair
because,
while
there
is
a
mechanism
to
force
those
who
refuse
to
pay
support,
there
is
no
mechanism
to
force
those
receiving
the
support
to
sign
an
agreement
in
time
for
the
taxation
year
even
if
the
support
is
acknowledged
by
declaring
it
as
income
in
the
1991
return.
3.
That
I
should
have
been
advised
earlier
by
Revenue
Canada
that
my
1991
claim
will
not
be
allowed
because
of
the
absence
of
the
required
document.
4.
The
fact
that
my
spouse
acknowledge
the
support
payment
by
declaring
it
as
part
of
her
1991
income.
This
return
was
filed
in
1992
which
is
within
the
prescribed
period
of
one
year.
Paragraph
7
of
the
respondent’s
reply
to
the
notice
of
appeal
stated:
7.
In
so
reassessing
the
appellant,
the
Minister
made
the
following
assumptions
of
fact:
(a)
the
facts
admitted
above;
(b)
pursuant
to
a
court
order
dated
October
28,
1993
the
appellant
was
required
to
pay:
(i)
for
the
maintenance
of
the
two
children
of
the
marriage,
the
sum
of
$750
per
month
per
child
commencing
November
1,
1993,
and
(ii)
for
the
support
of
the
spouse,
Edna
Aguilar,
the
sum
of
$300
per
month
commencing
November
1,
1993;
(c)
in
a
support
agreement
dated
December
31,
1993,
inter
alia:
(i)
Edna
Aguilar
acknowledges
having
received
the
sum
of
$1,600
per
month
for
the
months
of
November
1991
to
October
1993
inclusive;
(ii)
Edna
Aguilar
and
the
appellant
acknowledge
and
agree
that
the
payments
referred
to
in
7(c)(i)
above
are
considered
as
an
allowance
payable
on
a
periodic
basis
pursuant
to
subsections
56.1(3)
and
60.1(3)
of
the
Income
Tax
Act;
(d)
the
amount
was
paid
prior
to
the
both
the
court
order
and
support
agreement
referred
to
in
paragraphs
7(b)
and
7(c)
above;
(e)
the
amount
was
not
paid
in
the
year
of
the
court
order
or
support
agreement
referred
to
in
paragraphs
7(b)
and
7(c)
above,
or
the
preceding
taxation
year;
(f)
the
amount
was
not
paid
pursuant
to
a
decree,
order
or
judgment
of
a
competent
tribunal
or
pursuant
to
a
written
agreement
at
the
time
the
amount
was
paid;
(g)
the
appellant
was
not
separated
pursuant
to
a
divorce,
judicial
separation
or
written
separation
agreement
from
the
spouse
or
former
spouse.
The
key
provision
in
the
Income
Tax
Act
of
application
to
this
case
is
subsection
60.1(3)
of
the
Act
which
reads:
60.1(3)
For
the
purposes
of
this
section
and
section
60,
where
a
decree,
order
or
judgment
of
a
competent
tribunal
or
a
written
agreement
made
at
any
time
in
a
taxation
year
provides
that
an
amount
paid
before
that
time
and
in
the
year
or
the
immediately
preceding
taxation
year
is
to
be
considered
as
having
been
paid
and
received
pursuant
thereto,
the
following
rules
apply:
(a)
the
amount
shall
be
deemed
to
have
been
paid
pursuant
thereto;
and
(b)
the
person
who
made
the
payment
shall
be
deemed
to
have
been
separated
pursuant
to
a
divorce,
judicial
separation
or
written
separation
agreement
from
his
spouse
or
former
spouse
at
the
time
the
payment
was
made
and
throughout
the
remainder
of
the
year.
[Emphasis
added.]
The
thrust
of
Mr.
Aguilar’s
submission,
as
I
understand
it,
is
that
since
both
he
and
his
wife
have
done
all
they
could
to
make
the
1991
payments
come
within
the
deduction/inclusion
provisions
of
the
Act,
and
that
since
Parliament
similarly
has
attempted
to
recognize
retroactive
support
payments
through
subsection
60.1(3),
those
payments
made
prior
to
the
one-
year
time
limit
ought
to
be
allowed
by
this
Court
on
the
basis
of
underlying
statutory
purpose
and
intent.
To
accede
to
this
position
calls
for
an
examination
of
subsection
60.1(3)
itself
because
matters
of
purpose,
object
and
spirit
of
a
statutory
provision
are
to
be
considered
only
when
there
is
an
inherent
ambiguity
extant
in
the
legislation.
If
there
is
no
such
ambiguity
the
law
must
be
applied
as
the
Court
has
no
legislative
jurisdiction
or
function.
In
my
view
there
is
no
ambiguity,
latent
or
otherwise,
within
subsection
60.1(3)
of
the
Act,
and
the
well-intentioned
conduct
of
Mr.
and
Mrs.
Aguilar
cannot
operate
to
either
create
an
ambiguity
or
to
require
new
terms
to
be
added
into
a
statutory
provision
which
has
been
drafted
in
clear
terms.
Mr.
Aguilar
says
the
whole
thing
is
unfair
as
it
penalizes
a
person
who
is
trying
to
do
the
right
thing.
While
that
well
may
be
a
consequence
in
any
particular
situation,
subsection
60.1(3)
must
be
applied
as
written,
and
any
changes
as
to
timing
must
come
out
of
the
legislative
process.
In
conclusion
and
for
the
reasons
given,
the
appeal
is
dismissed.
Appeal
dismissed.
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