Guy
Tremblay
[TRANSLATION]:—This
case
was
heard
at
Montreal,
Quebec
on
August
21
and
22,
1979
on
common
evidence
with
the
appeals
of
Dr
Eugene
Lalande
(76-259
and
78-822).
1.
Point
at
Issue
The
question
here
is
whether
the
appellant,
a
doctor
and
also
director
of
a
corporation
(non-profit,
formed
to
construct
a
home
for
the
elderly)
is
entitled
to
claim
as
a
deduction
in
computing
his
net
income
the
sum
of
$31,678.12
for
1974
and
the
sum
of
$31,268.57
for
1975.
These
amounts
had
to
be
paid
to
the
banking
institutions
making
loans
to
the
corporation,
for
which
the
appellant
stood
surety.
The
corporation
was
in
financial
difficulty.
In
the
appellant’s
submission,
this
expenditure
was
incurred
for
the
purpose
of
earning
income
because
he
was
called
on
to
treat
many
elderly
people
as
part
of
his
medical
practice,
and
the
construction
of
a
home
for
the
elderly
would
have
provided
him
with
a
further,
permanent
source
of
patients.
2.
Facts
The
facts
set
forth
in
paragraphs
3.12
to
3.41
in
the
case
of
Dr
Lalande
(76-259
and
78-822)
are
the
same,
except
as
to
the
amounts
involved,
the
quantum
of
which
is
in
any
case
not
in
dispute:
in
1974
the
appellant
claimed
the
sum
of
$31,268.12
as
a
deduction,
and
in
1975
the
sum
of
$31,268.57,
$1,395.50
of
which
was
to
pay
a
premium
for
life
insurance
on
the
guarantors
so
as
to
protect
their
liability
in
the
event
of
death.
3.
Act—Case
Law—Comments
The
legislation,
case
law
and
principles
applicable
to
Dr
Lalande’s
case
being
the
same
as
in
the
case
at
bar,
the
conclusion
is
to
the
same
effect
as
well.
The
expenses
are
allowed
overall,
apart
from
the
sum
of
$1,394.50
to
pay
insurance
premiums
for
1975.
The
purpose
of
this
expenditure
was
not
to
earn
income
but
to
protect
capital.
4.
Conclusion
The
appeal
is
allowed
in
part
and
the
matter
referred
back
to
the
respondent
for
reassessment
in
accordance
with
the
foregoing
reasons
for
judgment.
Appeal
allowed
in
part.
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