Taylor,
T.C.J.—This
is
an
appeal
heard
in
London,
Ontario,
on
October
14,
1987
against
an
income
tax
assessment
for
the
year
1984,
in
which
the
Minister
of
National
Revenue
disallowed
an
amount
of
$7,609.38
as
travel
expense,
claimed
as
a
deduction
from
salary
and
wages,
under
paragraph
8(1)(h)
of
the
Income
Tax
Act.
The
notice
of
appeal
read
in
part:
In
1984-85
I
prepared
a
research
study
on
behalf
of
my
employer,
the
Windsor
Board
of
Education.
This
study
necessitated
the
visitation
of
several
boards
of
education,
universities,
and
departments
of
education
throughout
Canada
and
the
United
States.
This
study
was
approved
by
the
Board
and
the
resulting
study
was
presented
to
the
Board
in
November
of
1985.
Both
the
approval
and
the
report
satisfied
and
adhered
to
the
contractual
agreement
between
the
Board
and
I.
In
so
assessing
the
Minister
relied
upon
the
following
facts
and
assumptions:
—
prior
to,
and
for
a
part
of
the
1984
taxation
year,
the
Appellant
was
employed
as
a
teacher
by
the
Windsor
Board
of
Education;
—
the
Appellant
applied
for,
and
was
granted,
a
sabbatical
leave
for
the
1984/85
teaching
year
to
conduct
research
and
prepare
a
report
on
computer
utilization
throughout
North
America.
The
Appellant
was
not
employed
by
the
Windsor
Board
of
Education
for
the
duration
of
the
sabbatical
leave
—
the
Appellant
incurred
expenses
while
carrying
out
the
said
research
and
in
the
preparation
of
the
said
report
during
his
sabbatical
leave;
—
the
Appellant
was
not
required
by
his
contract
of
employment
to
take
sabbatical
leave;
—
the
Appellant
was
not
required
under
his
contract
of
employment
to
travel
away
from
his
employer's
place
of
business.
In
summary,
the
Minister’s
position
was
that
"the
appellant
was
not
employed
while
on
sabbatical
leave,
.
.
.
(and)
.
.
.
was
not
required
to
carry
out
any
duties
of
employment".
Accordingly,
the
appellant
is
not
entitled
to
claim
a
deduction
for
travelling
expenses
pursuant
to
paragraph
8(1)(h)
of
the
Act
by
virtue
of
subsection
8(2)
of
the
Act.
(Emphasis
mine).
Mr.
Graham
submitted
a
copy
of
the
relevant
portion
of
the
general
agreement
between
the
teaching
staff
and
the
Board
of
Education,
under
which
he
applied
for
the
sabbatical
leave.
It
read:
Article
XIII
Sabbatical
Leave
13.01
A
teacher,
in
order
to
apply
for
Sabbatical
Leave,
must
have
been
in
the
employ
of
the
Board
for
a
minimum
of
six
(6)
years
of
continuous
service,
immediately
preceding
the
application.
13.02
The
applicant
must
undertake
a
full-time
programme
of
formal
study
or
graduate
research
and
must
have
the
programme
approved
by
the
Director
of
Education.
It
shall
not
be
granted
to
upgrade
a
teacher
in
the
basic
classification
of
the
salary
schedule.
13.03
A
teacher
shall
give
a
commitment
in
writing,
in
a
form
approved
by
the
Board,
to
continue
to
teach
for
the
Board
for
a
period
of
two
(2)
years
after
returning
from
Sabbatical
Leave.
Should
he
or
she
leave
voluntarily
at
an
earlier
date,
the
monies
advanced
shall
be
repaid
at
the
discretion
of
the
Board,
on
a
prorated
basis
over
a
period
of
time
not
to
exceed
three
(3)
years.
13.04
The
teacher
will
receive
an
amount
of
money
during
the
leave
equal
to
100
percent
of
his
or
her
annual
salary
rate
at
the
time
Sabbatical
Leave
is
taken.
13.05
Up
to
three
(3)
teachers
from
the
Branch
Affiliates
will
be
allowed
a
Sabbatical
Leave
in
any
one
year
except
when
less
than
three
(3)
are
approved
in
which
case
a
carry
over
for
one
(1)
year
will
be
allowed
to
a
maximum
of
four
(4)
to
be
approved
in
that
carried
into
year.
13.06
Applications
for
Sabbatical
Leave
must
be
forwarded
to
the
Director
of
Education
prior
to
October
1,
to
be
considered
for
the
following
school
year.
A
selection
will
made
by
a
committee
which
will
submit
the
applications
to
the
Board
for
approval.
Applicants
may
re-apply,
without
prejudice
but
decisions
will
be
based
on
one
year
at
a
time.
Committee
to
be
composed
of:
1
member
from
F.W.T.A.O.
1
member
from
O.P.S.T.F.
1
trustee
1
administrator.
13.07
No
teacher
shall
be
granted
more
than
one
(1)
Sabbatical
Leave
during
his
or
her
employment
with
the
Windsor
Board
of
Education.
13.08
The
taking
of
a
year's
Sabbatical
Leave
shall
not
alter
the
number
of
days'
credit
in
the
Cumulative
Sick
Leave
Plan.
13.09
Sabbatical
Leave
shall
be
credited
as
teaching
experience
for
increment
purposes.
13.10
The
teacher
on
return
shall
submit
to
the
Board
a
written
report
on
his
or
her
year
of
study.
In
addition,
the
appellant
submitted
copies
of
correspondence
relative
to
his
situation,
of
which
are
reproduced:
BOARD
OF
EDUCATION
WINDSOR,
ONT.
|
Administrative
Office
|
Telephone
Number
|
|
Administrative
Office
|
|
|
451
Park
Street
West
|
Area
code
519
|
|
451
Park
Street
West
|
|
|
255-3200
|
|
P.O.
Box
210
|
|
|
N9A
6K1
|
|
|
November
11,
1983
|
|
|
Mr.
Dennis
Graham
|
|
|
Southwood
School
|
|
|
Dear
Mr.
Graham:
|
|
This
letter
is
to
confirm
that
at
its
Regular
Meeting
on
November
9,
1983
The
Windsor
Board
of
Education
approved
your
application
for
Sabbatical
Leave
for
the
school
year
1984-85.
This
approval
was
granted
with
the
understanding
that
in
accordance
with
the
provisions
of
the
Collective
Agreement
with
Elementary
School
Teachers
you
must
submit
for
my
approval
a
statement
of
the
full-time
program
of
formal
study
of
graduate
research
that
you
will
undertake.
Please
submit
this
information
as
soon
as
you
have
finalized
your
plans
with
the
appropriate
educational
institution.
May
I
wish
you
well
in
your
endeavours.
Sincerely,
Signed
SOUTHWOOD
ELEMENTARY
SCHOOL
1355
Cabana
Road
West,
Windsor,
Ontario.
N9G
1C3
Telephone
969-3470
June
10,
1984.
Mr.
W.P.
Willms
Director
of
Education
Windsor
Board
of
Education
451
Park
Street
West
Windsor,
Ontario
N9A
6K1
Dear
Mr.
Willms
Attached
please
find
a
copy
of
my
acceptance
into
the
graduate
research
program
at
the
University
of
Windsor
for
the
1984-1985
school
year.
My
task
will
be
to
develop
a
major
paper
on
Computer
Applications
and
Implications
for
Elementary
Schools.
Under
the
direction
of
my
advisor
it
is
my
aim
to
observe
and
evaluate
existing
programs,
collect
and
analyse
related
research
and
develop
recommendations
and
effective
strategies
to
maximize
computer
utilization
within
our
setting.
During
my
sabbatical
interview
I
distributed
a
packet
of
materials
indicating
the
scope
of
my
proposed
research.
Included
in
it
was
a
section
titled
‘Tentative
Regions
of
Study'.
At
that
time
I
indicated
this
was
only
a
partial
list.
An
updated
list
of
confirmed
areas,
institutions
and/or
persons
is
attached.
They
are
presented
in
the
relative
order
of
my
scheduled
visits.
I
trust
this
is
sufficient
information
for
your
approval.
If
there
are
any
areas
where
you
wish
additional
information,
please
contact
me.
Sincerely
Signed
Dennis
N.
Graham
Attachments
c.c.
D.
Braithwaite
BOARD
OF
EDUCATION
WINDSOR,
ONT.
|
Administrative
Office
|
Telephone
Number
|
|
451
Park
Street
West
|
AREA
CODE
519
|
|
P.O.
Box
210
|
255-3200
|
|
N9A
6K1
|
|
|
June
13,
1984
|
|
|
Dennis
Graham
|
|
|
SOUTHWOOD
ELEMENTARY
SCHOOL
|
|
|
Dear
Dennis
Graham:
|
|
Thank
you
for
your
recent
correspondence
advising
me
of
your
acceptance
into
the
graduate
research
program
at
the
University
of
Windsor
for
your
Sabbatical
Leave
during
the
school
year
1984-85.
In
accordance
with
the
provisions
of
the
current
Collective
Agreement
with
elementary
school
teachers
I
am
pleased
to
advise
that
your
program
of
graduate
research
is
approved.
You
certainly
have
developed
a
very
interesting
and
what
I
expect
will
be
a
very
challenging
program.
Best
wishes
in
your
endeavours.
I
shall
look
forward
to
exchanging
ideas
with
you
when
you
return
from
your
Sabbatical
Leave.
Sincerely,
Signed
Walter
P.
Willms
DIRECTOR
OF
EDUCATION
Mr.
Graham
was
aware
of
the
recent
case
of
The
Queen
v.
Herbert
H.
Jeromel,
[1986]
2
C.T.C.
207;
86
D.T.C.
6370
(F.C.T.D.)
and
the
similarity
to
his
own
case
of
that
situation
in
which
the
taxpayer
Jeromel
was
unsuccessful.
Mr.
Graham
argued
however
that
whatever
circumstances
in
Jeromel
(supra)
led
to
the
conclusion
by
the
learned
Justice
that
he
(Jeromel)
"was
not
employed"
during
the
sabbatical
year,
such
should
not
apply
to
him
since
the
circumstances
were
different,
and
unique
to
him
(this
appellant).
It
was
the
position
of
counsel
for
the
respondent
that
the
situation
in
Jeromel
(supra)
was,
for
all
practical
purposes,
identical
to
that
of
Mr.
Graham
—
and
that
Mr.
Graham
"was
not
employed"
by
the
Board
during
the
year
in
question;
did
not
perform
“duties
of
his
employment"
during
that
year,
and
that
therefore
the
"contract
of
employment"
did
not
require
the
travelling
expenses
claimed,
in
the
performance
of
the
duties.
Essentially
it
was
the
proposition
of
counsel
for
the
respondent,
that
the
"contract
of
employment"
was
in
some
way
"suspended",
or
“in
hiatus”
during
the
sabbatical
year
in
question.
Counsel
did
not
indicate
in
what
way
a
"sabbatical
leave"
so
suspended
the
employment
relationship,
when
there
did
not
appear
to
be
the
similar
result,
arising
out
of
a
normal
“vacation
leave”,
a
"leave
of
absence”,
or
for
that
matter
the
"week
ends"
when
the
normal
"duties
of
employment"
might
not
be
performed
by
the
individual.
Analysis
I
agree
that
the
particular
circumstances
which
the
learned
Justice
faced
in
Jeromel
(supra)
persuaded
him
to
conclude
in
that
instance
that
Mr.
Jeromel
"was
not
employed”,
but
I
am
not
persuaded
that
the
Minister
is
entitled
to
view
all
situations
of
“sabbatical
leave"
as
severing
the
"employment"
relationship
of
the
taxpayer
simply
based
on
the
views
expressed
for
Jeromel
(supra).
In
the
instant
case,
several
of
the
clauses
in
the
“Sabbatical
Leave"
section
of
the
Agreement
(supra)
leave
the
clear
impression
that
the
successful
applicant
for
sabbatical
leave
had
a
continuing
responsibility
to
the
Board;
the
letters
quoted
above
maintain
that
perspective;
the
acceptance
and
regulation
of
the
"report"
from
the
work
done
on
the
leave
is
also
consistent
with
that
opinion;
and
the
routine
issue
of
a
T4
slip
for
Mr.
Graham
for
the
year
in
question
is
also
significant.
The
question
might
well
be
asked
—
if
Mr.
Graham
was
not
an
employee
during
the
year
under
review,
then
what
was
he
—
an
independent
contractor?
But
even
if
Mr.
Graham's
argument
for
"employee"
status
should
be
accepted
by
this
Court,
that
does
not
dispose
of
the
point
at
issue.
Mr.
Graham
still
faces
the
difficulty
of
fitting
his
situation
under
the
narrow
confines
of
subparagraphs
8(1)(h)(i)
and
(ii)
of
the
Act
before
the
deductions
he
claims
can
be
allowed.
And
it
is
here,
as
I
see
it,
that
the
proposition
of
Mr.
Graham
breaks
down.
According
to
the
appellant,
the
Court
should
accept
that
he
was
in
effect
"assigned"
to
the
temporary
duties
of
the
research
project
in
which
he
engaged.
As
I
see
it
however,
his
“duties
of
employment",
under
the
contract
of
employment
were
to
teach
pupils
in
a
classroom.
During
the
year
in
question,
he
was
not
fulfilling
those
specific
"duties
of
employment";
he
was
rather
relieved
by
the
Board
of
the
responsibilities
of
so
doing.
That
would
come
far
short
of
fulfilling
the
conditions
in
subparagraph
8(1
)(h)(i)
of
the
Act.
With
respect
to
subparagraph
8(1)(h)(ii)
of
the
Act,
there
was
clearly
nothing
in
the
“contract
of
employment"
that
required
him
to
incur
the
costs
at
issue.
That
it
was
necessary
for
him
to
do
so
in
order
to
accomplish
the
task
he
had
set
for
himself
may
well
be
true,
and
that
some
value
may
have
fallen
to
the
Board
of
Education
therefrom
I
accept.
But,
the
simple
fact
is
that
Mr.
Graham
took
on
the
travel
requirements
as
an
integral
part
of
the
research
project
he
outlined,
and
for
which
he
requested
“sabbatical
leave"
to
perform.
If
indeed,
as
he
suggests,
the
Board
explicitly,
or
even
implicitly
required
him
under
his
contract
of
employment
to
incur
the
travel
expense,
then
of
course
one
source
of
recovery
would
be
to
seek
reimbursement
from
the
Board.
I
do
not
see
that
the
circumstances
under
which
Mr.
Graham
embarked
on
this
project
fit
under
the
narrow
restraints
of
the
Act
which
could
permit
the
sharing
of
these
travel
costs
with
the
public
through
the
income
tax
system.
Before
closing,
I
would
note
the
case
of
Aron
Rozen
v.
The
Queen,
[1986]
1
C.T.C.
50;
85
D.T.C.
5611,
in
which
the
taxpayer
was
successful
in
claiming
expenses
under
paragraph
8(1)(h)
of
the
Act.
I
would
quote
from
page
52
(D.T.C.
5613)
thereof:
this
was
basically
an
implied
term
of
his
contract
.
.
.
Rozen
(supra)
has
been
appealed
to
the
Federal
Court
of
Appeal,
and
further
enlightenment
on
paragraph
8(1)(h)
may
arise
out
of
that
action.
But
at
this
time,
it
is
sufficient
for
me
to
emphasize
that
which
I
have
already
indicated,
that
I
am
not
satisfied
that
the
contract
of
employment
for
Mr.
Graham
required
him
to
incur
the
expense
at
issue
in
this
appeal.
The
appeal
is
dismissed.
Appeal
dismissed.
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