Norma M Marossi v. Minister of National Revenue, [1980] CTC 2832, 80 DTC 1693

John B Goetz:—This an appeal by the appellant with respect to her 1975 taxation year. The appellant was assessed on the basis that she received a benefit in the amount of $994 as a result of going on tour sponsored by the Professional Seminars Consultants Ltd. In assessing the appellant, the respondent relied, inter alia, upon section 5, paragraph 6(1)(a) and subsection 248(1) of the Income Tax Act, SC 1970-71-72, c 63, as amended.

Facts

The appellant was employed as Director of Nursing Services at the South Waterloo Memorial Hospital in Cambridge, Ontario. In 1975 she was Presi- dent of the Registered Nurses Association of Ontario (hereinafter referred to as the “RNAO”). As President of the RNAO, the appellant received no Salary and was not entitled to a fixed or ascertainable stipend of remuneration. She was only reimbursed for travelling expenses incurred pursuant to her duties as President of the RNAO. She was not employed by the RNAO in 1975. In the course of her duties as President of the RNAO, the appellant made serveral trips in Ontario for the purpose of helping nurses practising more efficiently, studying health services communication and insurance benefits. She also dealt with the Department of Health. In 1974 she went on an orientation tour to assess clinical conditions in the USSR, which trip was arranged and paid for by Professional Seminars Consultants, which was a tour service. The Association gave her no payment whatsoever for the trip. The appellant thought that on the trip she would be in touch with health agencies and be able to attend nurses’ seminars which apparently were not included in the tour but, nevertheless, she visited health facilities on a voluntary basis. When she returned from Russia she gave a written report to the RNAO, approving of the tour with modifications. for the period of her tour, she was on vacation from her work as an employee of South Waterloo Memorial Hospital in Cambridge, Ontario. She paid for her own fare to Montreal where the tour began.

In cross-examination it was elicited further that some of her duties as President included meetings with her counterparts in the medical, dental and pharmaceutical professions, and the giving of speeches throughout Ontario and meeting members of the Association. Her absence from the South Waterloo Memorial Hospital was arranged by mutual agreement with her employer when she took these trips throughout Ontario. She stated that if she had not taken the tour, another officer or senior staff member would have gone. She had no commitment whatsoever to the tour company. Her ultimate recommendation to the Association was that if nurses took the trip, they would have to have some professional attraction.

The Assistant Executive Director of RNAO stated the purpose of the trip ws to check the travel services, visit clinics and nursing schools.

Findings

The relevant sections are section 5, paragraph 6(1)(a) and subsection 248(1) of the Income Tax Act 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. (1) There shall be included in computing the income of a taxpayer for a taxation year as income from an officer or employment such of the following amounts as are applicable:

(a) the value of board, lodging and other benefits of any kind whatever (except the benefit he derives from his employer’s contributions to or under a registered pension fund or plan, group sickness or accident insurance plan, private health services plan, supplementary unemployment benefit plan, deferred profit sharing plan or group term life insurance policy) received or enjoyed by him in the year in respect of, in the course of or by virtue of an office or employment.

248.(1) In this Act,

“employment” means the position of an individual in the service of some other person (including Her Majesty or a foreign state or sovereign) and “servant” or “employee” means a person holding such a position;

“office” means the position of an individual entitling him to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a Minister of the Crown, the office of a member of the Senate or House of Commons of Canada, a member of a legislative assembly or a member of a legislative or executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a respresentative capacity and also includes the position of a corporation director; and “officer” means a person holding such an office;

As can readily be seen, the description of the word “office” in subsection 248(1) does not fit the situation of the appellant as she was not entitled to a fixed or ascertainable stipend or remuneration as President of the RNAO. Consequently, paragraph 6(1)(a) does not apply in that she was not employed by the RNAO and although she held the office of President of the RNAO, it does not fit into the definition of “office” in the Income Tax Act. In my view, paragraph 6(1)(a) contemplates something as intended as a benefit or remuneration whereas the appellant received no remuneration and performed all her functions as President on a voluntary basis without remuneration.

The appellant cited the following cases:

Vernon C Hale v MNR, [1968] CTC 477; 68 DTC 5326;

Paul G Arsens v MNR, [1969] CTC 1; 69 DTC 81;

The respondent cited the following cases:

Courtney A Philp, Sidney Berm ack and Victor Cairns v MNR, [1970] CTC 330; 70 DTC 6237;

Harry O Waffle v MNR, [1968] CTC 572; 69 DTC 5007.

Although the appellant may have enjoyed the trip and though it may have had some material value, her purpose in taking the trip was to assess the tour and report back to her Association, which she did, and the person who took such orientation trip was decided by the Directors of the Association.

I find that the appellant received no benefit within the meaning of paragraph 6(1)(a) and section 5 of the Income Tax Act. I therefore allow the appeal and refer the matter back to the respondent for reconsideration and reassessment accordingly.

Appeal allowed.