Sarchuk,
T.C.J.:
—Larry
L.
Vincent
appeals
from
an
assessment
of
tax
with
respect
to
his
1985
taxation
year.
The
parties,
by
their
respective
solicitors,
have
admitted
certain
facts
and
have
filed
a
statement
of
those
agreed
facts
(Exhibit
A-1).
The
parties
have
also
agreed
that
they
may
add
further
and
other
evidence
relevant
to
the
issues
and
not
inconsistent
with
the
statement
which
reads
as
follows:
1.
The
appellant
has
been
employed
by
the
Ministry
of
Industry
&
Small
Business
Development
(the
"Employer")
from
about
September,
1980
to
date
and
has
been,
during
this
period,
a
member
of
the
British
Columbia
Government
Employees'
Union
("BCGEU").
2.
As
a
member
of
the
BCGEU,
the
appellant
was
bound
by
the
terms
of
a
collective
agreement
(the
“Collective
Agreement")
dated
November
7,
1979,
a
copy
of
which
Collective
Agreement
is
attached
hereto
as
Exhibit
"A".
3.
As
a
member
of
the
BCGEU,
the
appellant
was
bound
by
a
Component
Agreement
dated
November
7,
1979,
a
copy
of
which
Component
Agreement
is
attached
hereto
as
Exhibit
"B"
which,
inter
alia,
provided
that
the
regular
work
day
was
to
consist
of
no
more
than
nine
(9)
hours
per
day
(including
authorized
travelling
time)
exclusive
of
meal
periods
and
that
regular
hours
worked
were
to
total
thirty-
five
(35)
hours
per
week
averaged
over
a
two-week
period.
4.
As
a
member
of
the
BCGEU,
the
appellant
was
also
bound
by
an
Hours
of
Work
Scheduling
Agreement
(the
“Scheduling
Agreement")
dated
July
30,
1975,
a
copy
of
which
Scheduling
Agreement
is
attached
hereto
as
Exhibit
"C".
5.
The
Scheduling
Agreement
provided,
inter
alia,
that:
(a)
the
base
period
for
calculating
and
scheduling
daily
and
weekly
hours
of
work
was
a
two
week
period;
(b)
the
regular
work
week
for
an
employee
consisted
of
four
or
five
consecutive
days
between
Monday
and
Friday
inclusive;
(c)
an
employee
was
free
to
choose
one
of
nine
schedules,
any
of
which
in
turn
would
award
an
employee
a
Monday
or
Friday
off,
half-day
or
full
day;
(d)
the
procedure
for
choosing
a
particular
schedule
was
to
be
determined
jointly
by
the
Employer
and
a
designated
Union
representative;
(e)
employees
could
exchange
schedules
with
one
another
by
mutual
agreement
and
with
the
approval
of
the
Employer;
(f)
the
normal
work
day
consisted
of
three
time
periods
consisting
of
core
time
and
flexible
time
as
follows:
Entry
Period
—
7:30
a.m.
to
9:30
a.m.
(2
hours)
Core
Period
—
9:30
a.m.
to
3:30
p.m.
(6
hours)
Exit
Period
—
3:30
p.m.
to
7:00
p.m.
(3
/2
hours)
(g)
an
employee
could
come
and
leave
work
at
a
time
most
suitable
for
the
employee
and
the
work
which
had
to
be
done,
subject
to
operational
commitments,
because
the
Entry
and
Exit
periods
were
"flexible"
arrival
and
leaving
times.
6.
Pursuant
to
the
Scheduling
Agreement,
the
appellant
chose
a
work
schedule
pursuant
to
which
the
appellant
worked
a
five
day
week
followed
by
a
four
day
week.
7.
In
the
fall
of
1980,
the
Employer
advised
the
appellant
and
other
employees
to
work
a
"5/2"
schedule,
namely
five
consecutive
days
a
week
with
two
days
off.
The
Employer
and
the
BCGEU
attempted
unsuccessfully
to
resolve
this
issue
through
a
series
of
meetings
which
culminated
in
July,
1981.
8.
On
August
24,
1981,
the
Employer
stipulated
in
a
memorandum
that:
(a)
all
officers
and
functions
of
the
Employer
were
to
be
fully
staffed
from
8:30
a.m.
to
4:30
p.m.;
(b)
deviations
from
the
hours
would
be
permitted
only
for
operational
reasons
or
by
way
of
signed
agreements
concerning
modified
work
weeks
with
the
concurrence
of
the
Employer;
(c)
modified
work
week
schedules
were
to
target
for
Fridays
off
unless
operational
requirements
dictated
another
day
and
that
deviations
from
Fridays
off
were
to
be
kept
to
a
minimum;
and
(d)
two-thirds
staffing
levels
were
to
be
maintained
on
Fridays.
The
appellant
and
other
affected
employees
worked
the
revised
hours
stipulated
in
the
Employer's
August
24,
1981
memorandum
under
protest.
9.
On
September
18,
1981,
the
appellant
and
other
affected
employees
filed
a
grievance,
a
copy
of
which
is
attached
hereto
as
Exhibit
"D"
with
regard
to
the
dispute
and
also
applied
to
an
umpire
to
resolve
the
dispute.
The
Umpire
ruled
in
favour
of
the
appellant
and
the
other
affected
employees,
a
copy
of
which
report
is
attached
hereto
as
Exhibit
"E".
10.
On
October
17,
1983,
an
Arbitrator
allowed
the
grievance
and
made
an
Award
in
favour
of
the
appellant
and
the
other
affected
employees,
a
copy
of
which
Award
is
attached
hereto
as
Exhibit
"F".
11.
On
November
21,
1983,
the
Employer
reimplemented
the
“5/4
Schedule”
so
that
the
appellant
had
the
flexibility
of
working
a
five
day
week
followed
by
a
four
day
week.
12.
On
May
31,
1984
the
appellant
and
the
other
affected
employees
sought
some
compensation
for
the
unilateral
breach
of
the
Scheduling
Agreement.
13.
On
July
31,
1984,
the
Arbitrator
awarded
the
appellant
and
the
other
affected
employees
monetary
compensation
(the
"Award")
for
breach
of
the
Collective
Agreement,
a
copy
of
which
Award
is
attached
hereto
as
Exhibit
"G".
14.
On
October
12,
1984
and
July
3,
1985,
the
Labour
Relations
Board
of
British
Columbia
reviewed
the
Arbitrator's
Awards
of
October
17,
1983
and
July
31,
1984
and
also
determined
that
the
Employer
had
committed
a
breach
of
the
Collective
Agreement,
a
copy
of
which
Labour
Relations
Board
Awards
of
October
12,
1984
and
July
3,
1985
are
attached
hereto
as
Exhibits
"H"
and
"I".
15.
On
or
about
August
19,
1985,
the
appellant
received
as
his
share
of
the
Award,
$6,507.81
from
the
Employer
with
federal
and
provincial
income
tax,
CPP
and
UIC
withheld
at
source.
16.
The
appellant
filed
a
T1
tax
return
for
the
1985
taxation
year
and
reported
the
amount
of
$6,507.81
as
a
non-taxable
receipt
and
$240.79
as
interest
income.
17.
The
appellant
later
received
a
Notice
of
Assessment
dated
May
21,
1986,
pursuant
to
which
the
respondent
included
the
Award
of
$6,507.81
in
the
income
of
the
appellant
for
the
1985
taxation
year.
18.
The
appellant
duly
filed
a
Notice
of
Objection
dated
June
5,1986
in
respect
of
the
Notice
of
Assessment.
19.
The
respondent
issued
a
Notification
of
Confirmation
dated
October
9,1986
in
respect
of
the
Notice
of
Objection.
The
respondent
supports
his
assessment
on
the
following
basis:
(a)
the
amount
of
$6,507.81
received
by
the
appellant
constituted
income
from
the
employment
pursuant
to
subsection
5(1)
of
the
Income
Tax
Act;
(b)
alternatively
the
amount
in
issue
was
an
amount
received
by
the
appellant
from
his
Employer
during
a
period
while
he
was
in
the
employment
of
the
Employer
and
was
remuneration
or
partial
remuneration
for
services
under
the
contract
of
employment
and
accordingly,
the
amount
is
deemed
to
be
income
of
the
appellant
pursuant
to
subsection
6(3)
of
the
Income
Tax
Act;
(c)
the
amount
received
by
the
appellant
and
included
by
the
respondent
in
income
was
not
a
payment
for
injury
or
loss
within
the
meaning
of
subparagraph
110(1)(f)(ii)
of
the
Income
Tax
Act
and
is
not
an
allowable
deduction
under
that
provision.
The
appellant's
position
is
that
he
and
the
other
employees
did
not
seek
pay
for
overtime,
but
rather
sought
compensation
for
a
breach
of
the
collective
agreement
which
resulted
in
increased
costs
of
travel,
increased
costs
of
living,
a
loss
of
personal
freedom,
a
loss
of
the
right
to
spend
their
time
the
way
they
wished
and
job
related
stress.
Accordingly
the
amount
of
the
award
does
not
represent
salary,
wages
or
other
remuneration
under
section
5
of
the
Income
Tax
Act
("the
Act").
The
appellant
further
contends
that
the
award
was
not
a
benefit
of
any
kind
received
or
enjoyed
by
him
in
respect
of,
in
the
course
of,
or
by
virtue
of
his
office
of
employment
but
was
damages
or
compensation
for
personal
injury.
In
the
alternative,
if
the
amount
paid
does
represent
salary,
wages
or
other
remuneration
the
appellant
then
relies
on
paragraph
110(1)(f)
which
permits
a
taxpayer
a
deduction
for
compensation
received
for
injury,
disability
or
death
when
it
is
received
pursuant
to
a
workmen's
compensation
law.
Evidence
was
adduced
from
the
appellant,
from
Mr.
R.M.
Gubbe,
the
shop
steward
and
from
Mr.
Caple,
another
member
of
the
BCGEU,
to
demonstrate
that
the
amounts
paid
did
not
represent
payment
for
services
rendered.
Mr.
Gubbe
is
a
trade
development
officer
with
the
Ministry
of
Economic
Development.
He
is
a
member
of
the
BCGEU
and
in
1981
was
the
steward
for
the
appellant's
component
of
Local
601.
In
this
capacity,
on
September
18,
1981,
he
signed
a
grievance
on
behalf
of
all
members
of
the
component,
in
which
they
alleged
a
violation
of
the
Master
Agreement
by
the
employer.
The
details
of
the
grievance
were:
The
Employer
is
imposing
new
hours
of
work
pursuant
to
Article
14.02(g).
However,
the
conditions
which
would
allow
this
course
of
action
do
not
obtain,
to
wit:
no
new
hours
of
operation
or
new
programs
to
make
the
change
necessary;
there
are
no
“extenuating”
circumstances,
no
mutual
agreement
and
no
Umpire's
decision.
The
remedy
sought
by
the
grievors
was:
The
members
desire
the
Employer
to
abide
by
the
existing
Hours
of
Work
Agreement,
in
place
and
working
satisfactorily
since
1975.
The
hours
of
work
scheduling
agreement
required
an
employee
to
work
a
cumulative
total
of
70
hours
over
a
two-week
period
including
a
core
period
of
six
hours
from
9:30
a.m.
to
3:30
p.m.
on
each
working
day.
If
the
employee
selected
a
nine-day
working
schedule
in
a
two-week
period,
completion
of
70
hours
of
work
in
those
nine
days
entitled
him
to
take
the
tenth
day
off
as
a
“flex
day".
That
day
became
an
added
day
of
rest.
In
addition
to
launching
a
grievance
the
members
brought
the
matter
before
the
hours
of
work
umpire
(the
umpire).
The
involvement
of
the
umpire
is
not
a
step
in
the
grievance
procedure
but
is
an
alternative
method
provided
by
the
collective
agreement
to
resolve
disputes
relating
to
hours
of
work
and
to
obviate
the
need
for
a
grievance
procedure.
According
to
Gubbe
the
grievance
was
held
in
abeyance
while
the
parties
attempted
to
resolve
the
issue
before
the
umpire.
On
April
6,
1982
the
umpire
ruled
in
favour
of
the
employees
and
directed
that
they
revert
to
the
work
schedule
in
effect
from
July
30,
1975
to
September
18,
1981.
The
employer
then
took
the
position
that
it
was
not
bound
by
the
umpire's
decision
and
the
BCGEU
therefore
continued
with
its
grievance.
An
arbitrator
was
appointed
and
by
agreement
the
matter
proceeded
in
stages.
In
the
first
instance
the
arbitrator
ruled
that
the
employees
were
entitled
to
flex
time,
however
their
claim
for
compensation
was
not
addressed,
the
issue
being
adjourned.
(Arbitration
Award,
October
17,
1983,
Exhibit
A-1"F").
No
settlement
could
be
reached
by
the
parties
and
in
due
course
the
issue
of
compensation
was
brought
back
before
the
arbitrator
for
determination.
In
due
course
she
ruled
that
the
employees
were
entitled
to
compensation
but
reserved
judgment
on
the
exact
amounts
(Arbitration
Award,
July
31,
1984,
Exhibit
A-1"G").
The
amounts
were
finally
settled
as
between
the
parties
and
on
or
about
August
19,
1985
the
appellant
received
the
sum
of
$6,507.81
from
the
employer.
Gubbe
testified
that
he
was
personally
involved
in
the
process
to
the
arbitration
stage
at
which
point
the
matter
was
taken
over
by
the
BCGEU
and
its
legal
counsel.
At
some
point
of
time
thereafter,
in
the
course
of
instructing
counsel,
Gubbe
suggested
that
reference
be
made
to
the
issue
of
compensation
in
the
written
submissions
to
the
arbitrator
so
that
this
aspect
of
the
claim
would
be
on
record.
He
said
that
the
employees
asked
for:
.
.
.
an
equivalent
of
a
day's
pay
for
each
flex
day
we
did
not
get
because
next
to
getting
time
off
to
compensate
us
for
the
flex
days
we
didn't
get,
the
financial
recompense
was
seen
aS,
aS
the
next
best.
Gubbe
maintained
that
the
employees
never
discussed
a
claim
for
compensation
based
on
overtime
nor
had
the
concept
of
overtime
ever
arisen
as
a
method
of
calculating
the
compensation
sought.
He
said:
We
were
specifically
not
asking
for
overtime,
because
we
knew
very
well,
that
we
weren't
earning
any
overtime.
This
was
particularly
the
case
because
at
the
relevant
time
overtime
required
specific
authorization
from
the
employer,
and
during
that
period
was
rarely
requested
because
of
a
government
restraint
programme.
According
to
Gubbe
the
employees'
claim
was
in
reality
a
claim
for
damages
for
personal
injury
arising
out
of
the
loss
of
their
flex
day.
He
described
his
own
flex
day
as
a
day
of
rest
which
he
spent
in
preparing
for
projects
that
could
not
otherwise
be
completed
in
an
ordinary
weekend.
He
did
household
chores
and
maintenance
on
this
day,
thereby
permitting
him
and
his
wife
to
enjoy
Saturdays
and
Sundays,
which
were
her
days
off,
in
pursuing
“truly
leisure
days’.
Gubbe
stated
that
aside
from
these
“personal
losses"
he
did
not
suffer
any
economic
loss
as
a
result
of
the
alteration
of
the
hours
of
work
by
the
employer.
The
appellant
Vincent
was
a
trade
development
officer
with
the
Ministry
of
Economical
Development.
When
Vincent
was
hired
he
chose
to
work
a
five
day/four
day
schedule.
He
said
that
given
his
lifestyle
and
personal
requirements
an
added
day
of
rest
every
second
week
was
of
substantial
benefit
to
him,
permitting
him
to
attend
to
a
number
of
personal
and
family
matters
that
he
would
not
normally
be
able
to
do
in
a
two-day
weekend.
Although
the
employer's
directive
that
he
was
to
work
a
"5/2"
schedule,
being
five
consecutive
days
a
week
with
two
days
off
did
not
require
him
to
work
any
additional
hours,
it
caused
him
to
lose
the
benefit
of
having
the
flex
day.
He
said
that
it
was
difficult
to
translate
this
loss
into
a
financial
loss
since
the
loss
of
the
flex
day
involved
a
change
in
the
quality
of
his
life,
the
value
of
which
was
difficult
to
quantify.
It
was
his
recollection
that
although
the
employees
discussed
the
possibility
of
claiming
compensation
on
the
basis
of
actual
monetary
loss,
the
difficulty
in
resolving
the
problem
of
quantifying
it
led
them
to
conclude
that
the
compensation
to
be
sought
should
be
on
the
basis
of
one
day
of
pay
or
one
day
off
for
every
flex
day
they
were
required
to
work.
He
alleged
that
the
employees
did
not
discuss
overtime
since
they
were
still
working
70
hours
every
two
weeks
and
were
paid
for
that
time
whether
or
not
they
had
“flex
time".
It
was
not
disputed
that
the
employees'
claim
for
compensation
was
for
an
amount
over
and
above
the
regular
wages
received
by
the
appellant
and
was
equivalent
to
another
day's
pay.
Gubbe
confirmed
that
an
employee
who
was
called
back
or
otherwise
authorized
to
work
on
his
flex
day,
would
be
entitled
to
be
paid
overtime
on
the
basis
of
"double
time
for
all
hours
worked
on
a
day
of
rest"
as
set
out
in
Clause
16.06
of
the
collective
agreement,
and
that
this
was
the
basis
on
which
the
claim
for
compensation
was
made
by
the
union
to
the
arbitrator.
In
Vincent's
case
the
compensation
paid
to
him
as
a
result
of
the
award
was
calculated
and
agreed
upon
by
the
union
and
the
employer
to
be
the
equivalent
of
one
day's
pay
for
each
flex
day
he
was
required
to
work
as
a
result
of
the
employer's
action.
Vincent
stated
that
in
his
view
there
had
been
no
loss
of
income
to
him
during
the
period
of
time
he
worked
according
to
the
employer's
directive
and
that
the
award
he
received
was
compensation
over
and
above
the
salary
he
was
entitled
to
for
the
equivalent
time.
Mr.
Christopher
Caple
is
the
director
of
programme
design
and
project
appraisal
with
the
Ministry
of
Economic
Development.
In
the
period
of
June
1980
to
March
1981
he
helped
in
the
preparation
of
the
divisional
budget
and
was
aware
of
the
restraint
policy
which
was
being
introduced
by
the
government.
Commenced
in
August
1981,
the
policy
included
a
hiring
freeze
and
a
restriction
on
overtime
and
was
intended
to
cut
down
on
government
expenditures.
The
policy
was
taken
to
be,
at
least
by
him,
as
an
elimination
of
overtime.
Caple,
unlike
other
employees,
chose
a
schedule
consisting
of
seven
hours
of
work
for
each
of
five
days
per
week
for
a
total
of
70
hours
over
the
two
week
period
(a
5/2
week).
He
told
the
Court
that
as
a
result
he
was
not
adversely
affected
by
the
employer's
directive
that
all
employees
work
the
5/2
week
and
that
the
change
instituted
did
not
require
him
to
work
any
more
or
any
less
or
on
a
day
of
rest.
It
should
be
noted
that
the
arbitrator
in
her
award
made
no
reference
to
him
or
to
the
fact
that
his
situation
was
distinguishable
from
that
of
Vincent
and
the
other
employees.
Subsequently
during
the
course
of
the
negotiations
between
the
BCGEU
and
the
employer
to
settle
the
amount
of
compensation
to
be
paid
to
the
employees
concern
was
expressed
by
the
employer
about
payment
of
any
award
to
Caple.
The
issue
was
raised
but
following
further
discussions
between
counsel,
the
substance
of
which
are
[sic]
not
known
to
the
Court,
the
employer
agreed
to
pay
Caple
in
compliance
with
the
award.
Caple
ultimately
received
the
sum
of
$7,185.26
calculated
on
the
same
basis
as
the
payments
to
the
other
employees.
It
is
Vincent's
primary
position
that
the
amount
of
$6,507.81
received
by
him
in
taxation
year
1985
did
not
constitute
“salary,
wages
or
other
remuneration"
for
the
purposes
of
section
5
of
the
Act.
The
appellant
asserts
that
he
worked
no
more
than
the
stipulated
number
of
hours
required
by
the
various
agreements,
did
not
work
any
additional
hours
which
would
entitle
him
to
the
payment
of
overtime
or
additional
compensation,
and
at
all
times
received
the
exact
amounts
of
pay
that
were
set
out
in
the
collective
agreement
for
the
services
rendered.
It
was
argued
that
the
arbitrator
merely
used
the
overtime
calculation
as
a
measure
of
damages.
The
union
had
claimed
damages
for
breach
of
the
collective
agreement
and
not
damages
representing
lost
overtime
pay.
This,
it
was
alleged,
was
in
part
because
the
collective
agreement
did
not
permit
claims
for
overtime
unless
the
appellant
worked
in
excess
of
70
hours
over
a
two-week
period
or
worked
hours
in
excess
of
his
scheduled
daily
hours.
This
had
not
occurred.
Furthermore,
Vincent
had
not
worked
overtime
as
defined
in
the
collective
agreement
because
according
to
counsel
he
had
not
worked
on
a
day
of
rest.
Counsel
relied
on
the
arbitration
award
which,
he
said,
could
only
be
interpreted
to
mean
that
the
employees
were
not
being
paid
for
services
rendered
but
rather
received
damages
for
the
non-monetary
loss
suffered
by
them.
These
damages
were
awarded
pursuant
to
section
98(a)
of
the
Labour
Code
of
British
Columbia
for
a
violation
of
the
collective
agreement
by
the
employer.
Therefore
the
causa
causans
of
the
payment
was
not
the
services
rendered
by
the
appellant
but
the
wrongful
conduct
of
the
employer.
Counsel
argued
that
Vincent
received
damages
for
personal
injury
for
the
loss
of
days
off
and
the
alienation
of
his
right
to
enjoy
those
days
free
from
income
related
concerns,
including
loss
of
amenities
of
life,
resulting
from
the
inability
to
choose
how
to
spend
his
time
as
well
as
the
opportunity
to
work
overtime
if
he
chose
to
do
so.
That
payment
of
damages
was
not
made
pursuant
to
the
contract
of
employment
but
was
the
result
of
an
order
of
an
arbitrator
who
had
the
power
to
award
damages
for
such
injury
or
loss.
The
appellant
further
contends
that
the
amount
received
by
him
cannot
be
deemed
by
subsection
6(3)
of
the
Act
to
be
"remuneration"
for
purposes
of
section
5
of
the
Act
since
the
payment
received
was
not
one
for
employment.
Vincent
had
been
paid
his
full
salary
for
all
services
rendered
up
until
the
time
the
arbitration
award
was
made.
Therefore
the
payment
represented
compensation
for
capital
losses
being
loss
of
flexibility
and
loss
of
personal
and
economic
rights.
Counsel's
final
submission
was
that
if
the
payment
made
to
Vincent
had
to
be
categorized
at
all
the
evidence
unequivocally
led
to
a
conclusion
that
it
was
a
windfall,
meeting,
as
it
did,
the
criteria
enunciated
in
a
number
of
decisions,
including
Federal
Farms
Limited
v.
M.N.R.,
[1959]
C.T.C.
98;
59
D.T.C.
1050
(Exchequer
Court);
The
Queen
v.
Cranswick,
[1982]
C.T.C.
69;
82
D.T.C.
6073
(F.C.A.);
The
Queen
v.
Manley,
[1985]
1
C.T.C.
186;
85
D.T.C.
5150
(F.C.A.);
E.R.
Fisher
Ltd.
v.
The
Queen,
[1986]
2
C.T.C.
114;
86
D.T.C.
6364
(F.C.T.D.)
and
French
Shoes
Ltd.
v.
The
Queen,
[1986]
2
C.T.C.
132;
86
D.T.C.
6359
(F.C.T.D.).
The
question
to
be
decided
in
this
appeal
is
whether
the
amount
paid
to
Vincent
was
income
within
the
provisions
of
subsections
5(1)
and
6(3)
of
the
Act,
the
relevant
parts
of
which
read
as
follows:
5.
(1)
Subject
to
this
Part,
a
taxpayer's
income
for
a
taxation
year
from
an
office
or
employment
is
the
salary,
wages
and
other
remuneration,
including
gratuities,
received
by
him
in
the
year.
6.
(3)
An
amount
received
by
one
person
from
another
(a)
during
a
period
while
the
payee
was
.
.
.
in
the
employment
of,
the
payer,
or
(b)
on
account
or
in
lieu
of
payment
of,
or
in
satisfaction
of,
an
obligation
arising
out
of
an
agreement
made
by
the
payer
with
the
payee
immediately
prior
to,
during
or
immediately
after
a
period
that
the
payee
was
.
.
.
in
the
employment
of,
the
payer,
shall
be
deemed,
for
the
purposes
of
section
5,
to
be
remuneration
for
the
payee's
services
rendered
.
.
.
during
the
period
of
employment,
unless
it
is
established
that,
irrespective
of
when
the
agreement,
if
any,
under
which
the
amount
was
received
was
made
or
the
form
or
legal
effect
thereof,
it
cannot
reasonably
be
regarded
as
having
been
received
(d)
as
remuneration
or
partial
remuneration
for
services
.
.
.
under
the
contract
of
employment,
or
.
.
.
The
appellant's
submissions
that
section
5
and
subsection
6(3)
of
the
Act
do
not
apply
in
this
case
are
in
large
measure
premised
upon
three
propositions.
The
first
is
that
the
evidence
supports
a
conclusion
that
the
payment
received
by
Vincent
was
not
compensation
in
reference
to
any
services
rendered
by
Vincent
but
was
an
amount
of
damages
awarded
for
personal
injury,
principally
loss
of
amenities,
sustained
as
a
result
of
the
employer's
conduct.
The
second
proposition
is
that
on
any
reading
of
the
arbitrator's
rulings
it
was
evident
that
her
award
was
an
attempt
to
compensate
the
employees
for
their
loss
or
injury
and
that
the
measure
for
calculating
damages
was
the
overtime
wage
scale
set
out
in
the
collective
agreement.
The
third
proposition
is
that
the
payment
met
all
of
the
criteria
of
a
windfall.
With
respect
to
the
first
two
propositions
the
appellant
relied
upon
The
Queen
v.
Atkins,
[1976]
C.T.C.
497;
76
D.T.C.
6258
(F.C.A.);
McNeil/
v.
The
Queen,
[1986]
2
C.T.C.
352;
86
D.T.C.
6477
(F.C.T.D.);
Segall
v.
The
Queen,
[1986]
2
C.T.C.
364;
86
D.T.C.
6486
(F.C.T.D.)
and
Ransom
v.
M.N.R.,
[1967]
C.T.C.
346;
67
D.T.C.
5235.
The
McNeill
and
Segall
cases
are
distinguishable
on
their
facts.
Those
taxpayers
were
employed
by
Transport
Canada
as
air
traffic
controllers.
Disputes
arose
between
the
employer
and
some
of
the
controllers
when
the
use
of
French
was
introduced
as
a
working
language
at
the
Dorval
Airport.
In
order
to
diffuse
the
situation
the
employer
offered
the
employees
certain
options,
one
of
which
was
to
accept
a
transfer
outside
of
Québec.
Those
who
chose
to
accept
this
option
were
entitled
to
receive
an
“air
traffic
control
linguistic
relocation
allowance”
made
up
of
an
"accommodation
differential”
and
a
"social
disruption
allowance".
Both
McNeill
and
Segall
chose
this
option.
The
Minister
included
the
allowance
received
by
them
in
their
income
and
the
appeals
followed.
The
Court
held
that
the
allowance
did
not
fall
within
the
meaning
of
the
phrase
"salary,
wages
or
other
remuneration"
since
it
did
not
arise
under
the
contract
of
employment
in
relation
to
services
rendered
to
the
employer
by
the
employee.
Furthermore
the
allowance
was
not
deemed
to
be
remuneration
by
subsection
6(3)
of
the
Act
since
money
paid
as
an
incentive
to
compensate
for
a
capital
loss
brought
about
by
an
involuntary
transfer
while
remaining
in
the
employ
of
the
same
employer
and
providing
no
economic
benefit
to
either
party
was
not
caught
by
that
subsection.
The
Court
further
found
that
the
accommodation
differential
component
of
the
allowance
was
not
a
benefit
received
"in
respect
of,
in
the
course,
or
by
virtue
of"
the
taxpayer's
employment.
It
is
significant
that
in
Segall
and
McNeill
the
Court
found
that
the
payments
did
not
arise
by
virtue
of
the
contract
of
employment
but
rather
pursuant
to
a
separate
agreement,
and,
more
importantly,
that
such
payments
were
motivated
primarily
by
considerations
extraneous
to
the
employment,
namely
public
and
labour
relations
considerations.
That
is
not
the
case
in
this
appeal.
In
my
view
Atkins,
supra,
is
also
of
limited
assistance
to
the
appellant.
That
case
related
to
a
claim
of
wrongful
dismissal.
The
decision
of
the
Federal
Court
was
that
in
those
particular
circumstances
the
payment
of
moneys
in
lieu
of
a
proper
notice
of
dismissal
could
not
be
regarded
as
“salary”,
"wages",
or
"remuneration"
or
as
a
benefit
"received
or
enjoyed
by
him
.
.
.
in
respect
of,
in
the
course
of
or
by
virtue
of
his
office
or
employment".
It
should
be
noted
that
with
reference
to
Atkins,
supra,
Mahoney,
J.
in
The
Queen
v.
Manley,
[1985]
1
C.T.C.
186;
85
D.T.C.
5151
(F.C.A.)
stated
at
page
190
(D.T.C.
5154):
I
take
Atkins
as
authority,
which
I
must
respect,
for
the
proposition
that
an
amount
paid
in
settlement
of
a
claim
for
damages
for
wrongful
dismissal
is
not
salary,
taxable
as
income
from
an
office
or
employment
under
subsection
5(1)
of
the
Income
Tax
Act.
That
is
nothing
more
than
an
application
of
the
well
known
principle
that
a
taxpayer
is
entitled
to
the
benefit
of
any
doubt
as
to
legislative
intention
to
tax.
It
is
an
application
in
the
case
where
the
fisc
evidently
elected
to
plead
legislative
intention
on
a
single,
and
as
it
turned
out,
erroneous
basis.
Income
tax
appeals
in
this
Court
are,
of
course,
ordinary
actions
in
which
the
issues
are
defined
by
the
pleadings.
The
Court
makes
no
decision
on
what
might
have
been
pleaded
but
was
not.
Atkins
is
not,
and
does
not
purport
to
be,
authority
for
the
proposition
that
damages,
or
an
amount
paid
to
settle
a
claim
for
damages,
cannot
be
income
for
tax
purposes.
The
decision
of
the
Supreme
Court
of
Canada
in
Jack
Cewe
Ltd.
v.
Jorgenson,
[1980]
1
S.C.R.
812
at
814;
[1980]
C.T.C.
314;
80
D.T.C.
6233
at
6234
is
also
of
interest
in
this
context.
With
respect
to
Atkins,
supra,
Mr.
Justice
Pigeon
said:
I
have
grave
doubt
as
to
the
validity
of
this
reasoning.
Damages
payable
in
respect
of
the
breach
of
a
contract
of
employment
are
certainly
due
only
by
virtue
of
this
contract,
I
fail
to
see
how
they
can
be
said
not
to
be
paid
as
a
benefit
under
the
contract.
They
clearly
have
no
other
source.
In
Livesley
v.
Horst,
[1924]
S.C.R.
605
Duff,
J.
said,
speaking
for
the
Court
(at
p.
607):
In
principle,
it
is
difficult
to
discover
a
solid
ground
for
refusing
to
classify
the
right
to
damages
for
breach
of
contract
with
other
rights
arising
under
the
proper
law
of
the
contract,
and
recognizable
and
enforceable
as
such.
The
basic
principle
governing
the
award
of
damages
for
breach
of
contract
is
that
"the
party
complaining
should,
so
far
as
it
can
be
done
by
money,
be
placed
in
the
same
position
as
he
would
have
been
in
if
the
contract
had
been
performed".
I
fail
to
see
any
reason
why
this
would
not
hold
true
towards
the
tax
collector
as
well
as
towards
the
parties
to
the
contract.
In
income
tax
matters,
the
receipt
of
compensation
by
way
of
"damages"
is
neutral
without
further
evidence
as
to
the
nature
and
quality
of
the
award.
The
receipt
of
an
award
of
"damages"
may
or
may
not
result
in
the
receipt
being
taxable
income.
(See
Donald
Hart
v.
M.N.R.,
[1959]
C.T.C.
268
at
270;
59
D.T.C.
1134
at
1135.)
In
Raja's
College
v.
Gian
Singh
&
Co.
Ltd.,
[1977]
A.C.
312
(P.C.),
Lord
Fraser
had
this
to
say
at
page
318:
Questions
of
whether
sums
awarded
by
court
are
income,
liable
to
income
tax,
or
not,
have
arisen
in
a
number
of
reported
cases.
The
names
given
to
the
sums
awarded
have
varied:
"damages",
“interest”,
"compensation"
have
all
been
used,
but
the
Court
has
declined
to
be
bound
by
the
label
and
has
always
tried
to
look
through
it
and
"to
solve
the
question
of
substance”
in
the
words
of
Rowlatt
J.
in
Simpson
v.
Executors
of
Bonner,
Maurice
as
Executor
of
Edward
Kay
(1929),
14
T.C.
580,
592
by
reference
to
the
true
character
of
the
award.
To
determine,
for
the
purposes
of
income
tax,
the
true
nature
and
quality
of
the
compensation
ultimately
paid
to
Vincent,
I
considered
the
evidence
of
Gubbe,
Vincent
and
Caple
as
well
as
the
awards
of
the
arbitrator
and
the
decision
of
the
Labour
Relations
Board
of
British
Columbia
(the
"Board")
(Exhibit
A-T'H")
which
upheld
the
arbitrator's
decision
and
award.
I
have
concluded
that
the
assertions
of
the
appellant
and
of
the
other
witnesses
that
the
basis
of
their
claim
was
"personal
injury"
cannot
be
accepted.
The
record
of
the
proceedings
taken
on
behalf
of
the
employees
fails
to
support
this
position
and
in
fact
appears
to
contradict
it.
That
the
arbitrator
did
not
perceive
the
employees'
position
as
advancing
a
claim
for
“personal
injuries
suffered
as
a
result
of
the
wrongful
actions
of
the
Employer"
is
also
evident
from
her
reasons.
After
hearing
some
four
days
of
testimony
and
argument,
she
allowed
the
grievance,
and
ruled
that
the
employer
was
in
violation
of
the
collective
agreement
by
forcing
the
schedule
change
on
the
18
employees
in
question.
She
then
said:
In
written
argument,
the
Union
seeks
entitlement
to
payment
for
hours
actually
worked
as
if
those
employees
had
continued
on
their
5/4
schedule
on
and
after
September
21,
1982.
The
issue
of
compensation
was
not
specifically
argued
before
the
Board,
and
in
the
event
that
the
parties
are
unable
to
agree
on
that
issue,
I
reserve
jurisdiction
in
that
matter.
[Emphasis
added.]
The
parties
could
not
agree
and
the
arbitrator
heard
further
evidence
and
argument
on
the
issue
of
compensation.
In
her
supplementary
award
of
compensation
(Exhibit
A-1"G")
she
summarized
the
circumstances
which
led
to
the
initial
award
and
noted
the
employer's
intransigence
and
resistance
to
the
implementation
of
that
award.
She
then
described
the
union's
claim
for
compensation
in
the
following
words:
.
.
.
first,
payment
to
all
employees
at
the
effective
overtime
rate
in
the
Collective
Agreement,
double
time,
for
all
the
lieu
days
or
days
of
rest
that
the
18
employees
were
required
to
work
between
September
21,
1981
and
November
21,
1983.
[Emphasis
added.]
Secondly,
the
Union
seeks
payment
to
the
Union
for
injury
to
its
reputation
amongst
the
effected
(sic)
employees
.
.
.
Finally,
the
Union
also
seeks
interest
on
the
compensation
payable
to
the
employees.
The
parties
seek
a
determination
on
the
principles
only,
not
an
Award
on
the
actual
amounts.
The
arbitrator
noted
that
she
obtains
her
jurisdiction
to
make
a
monetary
award
under
the
authority
of
section
98
of
the
Labour
Code
of
British
Columbia
which
section
states,
in
part:
98.
For
the
purposes
set
out
in
section
92,
an
arbitration
board
has
the
authority
necessary
to
provide
a
final
and
conclusive
settlement
of
a
dispute
arising
under
a
collective
agreement,
and
without
limiting
the
generality
of
the
foregoing,
has
authority
to
(a)
make
an
order
fixing
and
determining
the
monetary
value
of
an
injury
or
loss
suffered
by
an
employer,
trade
union
or
other
person
as
a
result
of
a
contravention
of
a
collective
agreement,
and
directing
a
person
to
pay
a
person
all
or
part
of
the
amount
of
that
monetary
value
.
.
.
The
arbitrator
then
posed
the
following
question:
Should
there
be
compensation
paid
to
the
employees?
If
so,
are
they
entitled
to
overtime,
for
"hours
worked
on
a
day
of
rest"?
[Emphasis
added.
I]
The
issue
as
set
out
by
the
arbitrator
reflects
the
position
with
respect
to
compensation
taken
by
counsel
for
the
BCGEU
throughout
the
arbitration
process.
On
the
face
of
it
the
underlying
rationale
of
the
award
was
the
concept
of
“missed
overtime".
It
is
significant
that
most
of
the
cases
cited
by
counsel
for
the
BCGEU
appear
to
have
been
tendered
to
support
the
grievor's
entitlement
to
overtime
pay
for
work
done
outside
of
scheduled
hours
tendered
by
counsel
on
behalf
of
the
employees.
On
the
face
of
it
the
appellant's
claim
for
compensation
was
at
all
times
advanced
and
determined
on
that
basis.
The
position
taken
by
the
employer
at
arbitration
is
also
relevant.
It
argued
unsuccessfully
that
the
employees
worked
the
same
number
of
hours
and
received
the
identical
amount
of
pay
before
and
after
the
directive
and
therefore
no
overtime
compensation
was
payable
to
them.
The
appellant
now
bases
one
of
his
arguments
on
this
very
same
proposition.
In
her
award
the
arbitrator
referred
to
a
number
of
cases
with
approval,
in
particular
Re
Rothmans
of
Pall
Mall
Canada
Ltd.
and
Tobacco
Worker's
International
Union,
Local
319,
8
L.A.C.
(2d)
60.
That
was
a
case
where
a
grievor
sought
moneys
lost
as
a
result
of
the
employer
not
following
the
overtime
procedure
set
out
in
the
collective
agreement.
In
that
instance
the
arbitrator
ruled:
The
purpose
of
a
remedy
for
a
breach
of
the
Collective
Agreement
is
not
to
penalize
the
employer
for
a
bona
fide
mistake,
but
to
compensate
the
innocent
party
and
the
best
method
of
so
compensating
an
innocent
employee
is
to
place
him
in
the
same
position
as
he
would
have
been
if
the
Agreement
had
been
performed
according
to
its
terms.
.
.
.
Usually
a
monetary
award
is
an
adequate
measure
of
the
benefit
the
employee
would
have
received
under
the
Collective
Agreement
had
it
been
properly
performed.
[Emphasis
added.]
She
then
went
on
to
say:
In
this
case,
there
was
no
argument
or
suggestion
submitted
to
the
Board
as
to
how
an
in
kind
remedy
could
be
reached.
I
am
satisfied
that
compensation
should
be
paid
to
the
employees
in
question,
and
I
cannot
find
any
comparable
substitute
to
monetary
compensation,
such
as
the
in
kind
remedies
referred
to
in
the
Johns
Manville
or
Rothmans
cases.
The
alternative
of
the
employees
taking
the
actual
number
of
lieu
days
missed
was
never
considered,
and
under
the
circumstances,
it
should
not
be
considered
by
this
Board
as
a
comparable
substitute.
We
are
therefore
left
with
monetary
compensation.
Having
stated
that
I
believe
monetary
compensation
is
the
only
way
for
these
employees
to
be
restored
to
the
position
that
they
would
have
been
in
had
the
Collective
Agreement
not
been
violated,
I
must
then
determine
whether
that
should
be
at
overtime
rates
or
not.
The
Collective
Agreement
deals
with
overtime
in
Article
16,
which
defines
overtime
as
work
performed
by
a
full
time
employee
in
excess
or
outside
of
his/her
regularly
scheduled
hours
of
work.
Article
16.06(a)(iii)
states
that
overtime
worked
shall
be
compensated
at
"double
time
for
all
hours
worked
on
a
day
of
rest".
These
employees
were
compelled
to
work
on
their
lieu
days,
or
days
of
rest,
and
accordingly,
should
be
paid
on
an
overtime
basis.
However,
there
should
also
be
a
set-off
of
the
monies
that
they
were
actually
paid
for
the
work
actually
done
on
those
days
following
the
same
reasoning
of
Arbitrator
Chertkow
in
the
Okanagan
decision.
[Emphasis
added.]
I
do
not
agree
with
counsel's
submission
that
the
arbitrator's
reasons
can
realistically
be
read
as
awarding
damages
to
Vincent
for
"personal
injury"
including
"loss
of
amenitities
of
life”
or
as
damages
for
a
“non-monetary
loss"
suffered
by
him.
The
award
flows
from
the
fact
that
the
employer,
by
requiring
Vincent
to
work
on
his
flex
day,
put
him
in
exactly
the
same
position
as
if
he
had
been
required
to
work
on
any
other
day
of
rest.
The
requirement
to
work
on
a
day
of
rest
in
every
instance
impinges
upon
the
right
of
an
employee
to
organize
his
time
to
his
best
advantage
and
to
spend
his
leisure
time
as
he
sees
fit.
That
is
no
doubt
why
an
employee
required
to
work
on
a
day
of
rest
is,
by
the
collective
agreement,
entitled
to
double
time
for
all
hours
worked.
The
arbitrator
noted
that
the
alternative
of
giving
Vincent
a
day
off
for
each
rest
day
missed
was
neither
advanced
nor
considered.
The
compensation
paid
pursuant
to
the
award
did
no
more
than
restore
Vincent
to
the
position
that
he
would
have
been
in
had
the
wages
set
out
in
the
collective
agreement
for
working
on
a
day
of
rest
been
paid.
Counsel
for
the
appellant
also
contended
that
the
arguments
advanced
on
behalf
of
Vincent
could
also
be
supported
by
the
fact
that
both
he
and
Caple
were
successful
in
claiming
compensation,
even
though
the
employer's
directive
had
not
led
to
a
change
in
Caple's
work
schedule
and
did
not
require
Caple
to
work
on
a
day
of
rest.
This,
it
was
submitted,
was
consistent
with
the
appellant's
position
that
the
compensation
was
paid
as
damages
for
personal
injury
or
loss
and
was
proof
that
the
award
was
not
related
to
or
the
result
of
a
claim
for
overtime
for
working
on
a
day
of
rest.
I
am
not
at
all
satisfied
that
the
differences
between
Vincent's
circumstances
and
those
of
Caple
led
to
the
conclusions
urged
upon
me
by
counsel.
My
review
of
the
award
and
of
the
decision
of
the
Board
left
me
with
a
very
firm
impression
that
neither
the
arbitrator
nor
the
Board
was
aware
of
that
factual
distinction.
For
whatever
reason
the
parties
at
all
times
lumped
the
employees
together
without
differentiation.
The
grievance
refers
to
all
members
of
Component
6
but
does
not
name
them
individually.
Before
the
arbitrator
the
style
of
cause
describes
the
grievors
as
"Robert
Gubbe
et
al.".
Gubbe's
letter
to
the
BCGEU
President,
which
is
quoted
in
its
entirety
by
the
arbitrator,
not
only
fails
to
distinguish
between
the
em-
ployees
but
implies
that
all
of
them
including
Caple
were
working
on
a
5/4
schedule
and
were
affected
by
the
employer's
directive.
The
Board
referred
to
the
award
in
issue
as
the
"Gubbe"
award
and
made
no
reference
whatsoever
to
the
circumstances
of
any
particular
employee.
Although
on
the
face
of
it
Caple’s
particular
circumstances
might
not
have
supported
a
claim
for
either
"lost
overtime"
or
for
"damages
and
compensation
for
personal
injury”
the
specific
facts
peculiar
to
him
do
not
appear
to
have
been
raised
or
argued
or
determined.
The
only
logical
conclusion
is
that
the
failure
to
distinguish
between
his
situation
and
that
of
the
other
employees
was
an
oversight
by
all
concerned.
In
such
circumstances
the
payment
to
Caple
can
only
be
viewed
as
a
neutral
fact
incapable
of
supporting
the
position
of
either
of
the
parties.
The
award
was
made
for
the
purpose
of
satisfying
Vincent's
entitlement
to
compensation
pursuant
to
the
collective
agreement
as
it
related
to
wages
to
be
paid
for
services
rendered
on
a
day
of
rest
and
is
income
within
the
meaning
of
section
5
of
the
Act.
The
payment
he
received
arose
clearly
and
unequivocally
by
virtue
of
the
contract
of
employment
and
not
as
a
result
of
some
separate
agreement
or
from
motivations
extraneous
to
the
collective
agreement.
In
view
of
this
conclusion
it
is
not
necessary
to
apply
the
deeming
provisions
of
subsection
6(3)
of
the
Act.
It
also
follows
that
the
payment
made
to
Vincent
by
his
employer
cannot
be
characterized
as
a
windfall.
In
the
alternative
the
appellant
contends
that
if
section
5
of
the
Act
is
applicable
the
amount
received
by
him
constitutes
"compensation
received
under
an
employee's
or
workmen's
compensation
law
of
Canada
or
a
province
in
respect
of
an
injury,
disability
or
death"
for
the
purposes
of
paragraphs
56(1)(v)
and
110(1)(f)
of
the
Act.
These
paragraphs
read:
56.
(1)
Without
restricting
the
generality
of
section
3,
there
shall
be
included
in
computing
the
income
of
a
taxpayer
for
a
taxation
year,
(v)
compensation
received
under
an
employee's
or
workmen's
compensation
law
of
Canada
or
a
province
in
respect
of
an
injury,
disability
or
death.
110.
(1)
For
the
purpose
of
computing
the
taxable
income
of
a
taxpayer
for
a
taxation
year,
there
may
be
deducted
such
of
the
following
amounts
as
are
applicable:
(f)
any
amount
that
is
(ii)
compensation
received
under
an
employee's
or
workmen's
compensation
law
of
Canada
or
a
province
in
respect
of
an
injury,
disability
or
death,
except
any
such
compensation
received
by
a
person
as
the
employer
or
former
employer
of
the
person
in
respect
of
whose
injury,
disability
or
death
the
compensation
was
paid,
to
the
extent
that
it
has
been
included
in
computing
the
taxpayer's
income
for
the
year.
It
was
submitted
that
the
arbitration
award
satisfies
all
of
the
elements
required
by
paragraphs
56(1)(v)
and
110(1)(f)
of
the
Act.
The
British
Columbia
Labour
Code,
R.S.B.C.
1979
c.
212
("the
Code")
regulates
industrial
relations
between
parties
who
choose
to
regulate
their
employment
relations
through
collective
bargaining.
The
collective
agreement
is
a
contract
concluded
by
the
employer
and
the
employees
which,
inter
alia,
makes
refer-
ence
to
payments
for
disability.
Furthermore
the
Code
supplements
the
laws
governing
the
employment
relationship
created
by
the
collective
agreement,
and
in
particular
authorizes
payment
or
compensation
for
“injury
or
loss".
Counsel
contended
that
it
logically
followed
that
payments
ordered
by
an
arbitrator
pursuant
to
section
98
of
the
Code
should
be
considered
payments
ordered
by
the
“compensation
board".
He
submitted
that
such
an
approach
was
consistent
with
Revenue
Canada
Interpretation
Bulletin
IT-202R2
which,
as
counsel
read
it,
included
payments
made
pursuant
to
a
collective
agreement
and
not
pursuant
to
a
compensation
board
award
within
the
scope
of
the
phrase
"a
payment
under
a
compensation
law
of
a
province”.
In
summary
counsel
contended
that
Vincent
received
compensation
from
an
arbitrator
who
had
the
right
to
compensate
him
for
non-monetary
injury
pursuant
to
the
provisions
of
section
98
of
the
Code.
The
amount
which
was
paid
to
Vincent
was
therefore
paid
as
compensation
for
an
injury
and
constituted
compensation
received
under
a
workmen's
compensation
law
of
Canada
within
the
meaning
of
paragraphs
56(1)(v)
and
110(1)(f)
of
the
Act.
Interpretation
Bulletin
IT-202R2
relied
on
by
counsel
for
the
appellant
does
not
support
the
argument
advanced.
The
relevant
portion
of
that
Bulletin,
being
paragraph
4,
reads:
For
the
purpose
of
paragraph
56(1)(v)
the
amount
of
compensation
may
be
received
either
from
a
compensation
board
or
from
the
employer
or
former
employer
of
the
person
entitled
thereto.
An
employee
may,
under
the
terms
of
an
employment
contract
or
collective
agreement,
or
by
reason
of
being
granted
injury
leave
with
pay
under
the
Financial
Administration
Act,
be
entitled
to
receive
salary
or
wages
during
a
period
in
which
the
employee
is
also
entitled
to
compensation.
Where,
in
these
circumstances,
the
employee
receives
no
payment
from
a
compensation
board,
the
amount
received
from
his
or
her
employer,
to
the
extent
that
it
does
not
exceed
the
compensation
amount,
will
be
included
in
the
employee's
income
for
the
year,
as
compensation,
under
paragraph
56(1)(v).
The
excess,
if
any,
will
be
included
in
the
employee's
income
under
subsection
5(1).
Compensation,
for
the
purposes
of
this
Bulletin
is
defined
by
paragraph
1
as
the
amount
of
an
award,
as
adjudicated
by
a
compensation
board,
which
a
worker
will
receive
as
a
result
of
having
suffered
illness,
injury
or
death
in
the
performance
of
his
duties
of
employment.
The
Bulletin
appears
to
be
intended
to
provide
for
those
special
circumstances
where
there
is
both
an
award
of
compensation
and
a
contractual
entitlement
to
salary
or
wages
for
the
same
period.
In
such
circumstances,
if
the
employee
receives
no
payment
from
the
compensation
board,
the
amount
received
from
the
employer
will
be
considered
by
the
Minister
as
compensation
under
paragraph
56(1)(v)
of
the
Act.
Whether
this
administrative
stance
is
legally
correct
is
not
a
matter
which
need
be
considered
at
this
time.
It
is
sufficient
to
say
that
the
circumstances
referred
to
in
the
Bulletin
have
no
application
to
the
facts
presently
before
the
Court.
The
Minister’s
readiness
to
treat
payments
made
by
an
employer
pursuant
to
a
collective
agreement
in
very
specific
and
particular
circumstances
as
compensation
for
the
purposes
of
paragraph
56(1)(v)
of
the
Act
does
not
lead
to
the
conclusion
that
any
payment
made
pursuant
to
a
collective
agreement
amounts
to
payment
under
a
compensation
law
of
a
province
or
that
an
award
under
a
provincial
labour
code
amounts
to
such
a
payment.
Counsel's
characterization
of
the
payment
to
Vincent
as
compensation
received
under
an
employee's
or
workmen's
compensation
law
of
the
Prov-
ince
of
British
Columbia
is
not
tenable.
The
reference
in
subsections
56(1)
and
110(1)
of
the
Act
to
"a
workmen's
compensation
law
of
Canada
or
of
a
province"
is
a
reference
to
specific
enactments
which
are
intended
to
provide
compensation,
medical
assistance
and
services
and
pensions
for
employees
injured
in
on-the-job
accidents
and
which
are
funded
for
the
most
part
by
compulsory
employer
contributions.
These
statutes
have
been
described
as
social
legislation
designed
to
achieve
that
purpose.
(Fleck
v.
Workmen's
Compensation
Board,
[1934]
2
D.L.R.
145.)
Mignault,
J.
dealing
with
the
Workmen's
Compensation
Act,
C.S.N.B.
1903,
c.
79
in
the
case
of
The
Canadian
Pacific
Railway
Company
v.
Cheeseman,
57
S.C.R.
439
said
at
page
450:
The
object
of
the
.
.
.
Act
was
to
give
to
the
workman
a
remedy
where
none
could
be
claimed
under
the
common
law,
the
risk
of
injury
through
the
negligence
of
a
fellow
servant
being
a
risk
assumed
by
the
workman
at
common
law.
The
resolution
of
a
contractual
dispute
between
an
employee
and
an
employer
and
the
awarding
of
compensation
by
an
arbitrator
pursuant
to
authority
granted
by
the
Code
is
not
at
all
analogous
to
a
payment
of
compensation
by
the
Workmen's
Compensation
Board
of
the
Province
of
British
Columbia
in
respect
of
a
death,
personal
injury,
or
for
a
disability
from
an
injury
(including
by
definition
an
industrial
disease)
arising
out
of
and
in
the
course
of
employment.
The
amounts
paid
to
Vincent
were
not
compensation
received
under
an
employee's
compensation
law
within
the
meaning
of
paragraphs
56(1
)(v)
and
110(1)(f)
of
the
Act.
One
further
issue
must
be
dealt
with.
When
the
appellant
filed
his
T1
tax
return
for
the
1985
taxation
year
he
reported
the
sum
of
$240.79
as
"interest
income
from
Canadian
sources
eligible
for
interest
deduction”.
The
respondent,
in
his
assessment,
took
the
position
that
the
sum
was
not
eligible
for
deduction
pursuant
to
subsection
110.1(1)
of
the
Act
and
disallowed
the
deduction.
By
his
counsel,
the
respondent
now
concedes
that
this
amount
was
an
amount
eligible
for
interest
deduction
for
the
purposes
of
both
paragraph
12(1)(c)
and
subsection
110.1(1)
of
the
Act.
To
that
extent
only
the
appeal
will
be
allowed.
In
all
other
respects
the
assessment
is
confirmed.
Appeal
allowed
in
part.
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