Mitchell Scott Luxton v. Her Majesty the Queen, [1996] 3 CTC 2449 (Informal Procedure)

Christie A.C.J.T.C.C.: — This appeal is governed by the informal procedure prescribed under section 18 and following sections of the Tax Court of Canada Act.

In computing his tax payable for 1992 the Appellant deducted an amount determined under subsection 118.3(1) of the Income Tax Act (the “Act”). It provides:

Where

(a) an individual has a severe and prolonged mental or physical impairment, (a.l) the effects of the impairment are such that the individual’s ability to perform a basic activity of daily living is markedly restricted,

(a.2) a medical doctor, or where the impairment is an impairment of sight, a medical doctor or an optometrist, has certified in prescribed form that the individual has a severe and prolonged mental or physical impairment the effects of which are such that the individual’s ability to perform a basic activity of daily living is markedly restricted,

(b) the individual has filed for a taxation year with the Minister the certificate described in paragraph (a.2), and

(c) no amount in respect of remuneration for an attendant or care in a nursing home, in respect of the individual, is included in calculating a deduction under section 118.2 (otherwise than because of paragraph 118.2(2)(b. 1)) for the year by the individual or by any other person,

for the purposes of computing the tax payable under this Part by the individual for the year, there may be deducted an amount determined by the formula

A x $4,118

where

A is the appropriate percentage for the year.

Subsection 118.4(1) provides:

For the purposes of subsection 6(16), sections 118.2 and 118.3 and this subsection,

(a) an impairment is prolonged where it has lasted, or can reasonably be expected to last, for a continuous period of at least 12 months;

(b) an individual’s ability to perform a basic activity of daily living is markedly restricted only where all or substantially all of the time, even with therapy and the use of appropriate devices and medication, the individual is blind or is unable (or requires an inordinate amount of time) to perform a basic activity of daily living;

(c) a basic activity of daily living in relation to an individual means

(i) perceiving, thinking and remembering,

(ii) feeding and dressing oneself,

(iii) speaking so as to be understood, in a quiet setting, by another person familiar with the individual,

(iv) hearing so as to understand, in a quiet setting, another person familiar with the individual,

(v) eliminating (bowel or bladder functions), or

(vi) walking; and

(d) for greater certainty, no other activity, including working, housekeeping or a social or recreational activity, shall be considered as a basic activity of daily living.

The focus of the appeal is on subparagraph 118.4(l)(c)(i). As has been seen, it relates to the basic activity of daily living pertaining to “perceiving, thinking and remembering [1] .” These are elusive concepts that do not lend themselves to easy definition and application as is graphically depicted in Radage v. R..

Dr. Michael J. Stambrook a clinical phsychologist and neuropsychologist testified on behalf of the Appellant. He examined the Appellant in November 1995. The Appellant was said to have been a healthy child at birth and for the first two or three years. He then developed a number of infections accompanied by a high fever and his speech development stopped. From then to the age of seven or eight he began to have a history of developmental aphasia. He underwent a number of neurological examinations that showed substantial disfunction of the left hemisphere of his brain. He had fairly significant widespread left hemispheric electrical activity disfunction that was leading to frequent seizures, not in a physical sense, but seizures disrupting his language learning ability. In 1987 he underwent a left temporal lobectomy. These exchanges between counsel for the Appellant and Dr. Stambrook followed:

Q. So would it be fair to say that as a consequence of seizures, a part of his brain was removed?

A. As a consequence of seizures, to treat the seizure disorder, a fairly large part of his brain was removed, yes.

Q. And this, would it be fair to say that this had an impact on Mr. Luxton’s ability to perceive, think and remember?

A. Absolutely. Even before the surgery, he had even more marked impairment and, in fact, early on, depending on the time he was assessed, he had an intellectual level that ranged from high average range to markedly deficient range, and that the range was depending on how active and severe the seizures were at that time.

So before he had widespread disturbance of his left hemisphere. After the surgery, he continued to have, despite no outward seizures, he continued to have abnormalities in the electrical activity in his left hemisphere. And he has needed, since that time, significant input, through speech pathology, remedial education, special school placements, which had a profound effect in his life and psychological and social and emotional development.

Q. And what is, in your assessment, Mr. Luxton’s ability to think like?

A. Thinking is not a unitary thing. Thinking is made up of multiple components. And Mr. Luxton has very well intact functioning in parts of his brain that were unaffected by his severe childhood and adult neurological problem. He has got thinking disruptions when it - when the information he is dealing with is language based. He has got profound problems when he needs to use written symbols, writing, when he needs to read, when he needs to do some manipulation of thinking products that involve these symbols.

Q. So, for example, the ability to read, what would Mr. Luxton’s ability be to read?

A. He is what I would call alexic. “A” means no, “lexia” language, reading. He has no ability to do that. He has no ability to be functional in any way. He has trouble with three-letter words.

Q. So if Mr. Luxton would see a stop sign, could he read that sign?

A. He doesn’t need to read a stop sign. A stop sign is not just a stop; it’s a colour and it’s a shape. Mr. Luxton has no difficulty in matching shapes and colours with actions, so he is able to learn a finite, small group of symbols and shapes and connect them. From what I understand, Mr. Luxton is a driver, unrestricted.

Q. But what about the ability to read a Grade 1 text; would Mr. Luxton have the ability to do that?

A. No, he does not have the ability to do that.

Q. If-

A. Based on the assessment I’ve done, he does not have the ability to do that.

Q. And the ability to write, is that - what does —

A. These are very intimately connected together and, in fact, our early childhood education puts them both together. He has profound impairment in his ability to write, to spell, to read.

The witness then dealt with perception. These questions were asked by counsel for the Appellant and these answers were given by the witness:

Q. Okay. Now with regard to perception, could you describe sort of what perception is and perhaps focus in on auditory perception?

A. Perception is the ability to analyze sensory information that’s coming in, either external to the body or the body’s own stimulus productions. It’s the ability to analyze what kind of meaning is involved in the sensory information that comes in.

Q. And would that include speaking to someone to give that person instructions?

A. That would be involved — that would involve analysing the auditory signal, the command, the instructions you’re giving, analysing it for its acoustical properties and then bringing out of that the meaningful qualities of the direction, and then formulating some plan based on hearing and the analysis of that.

Q. And what is Mr. Luxton’s ability to perform in this area like?

A. Depending on the input medium. He is stronger auditorially. He can follow commands. He can carry out a conversation, albeit for some of the weaknesses I have talked about. He has some mild weakness in his memory that would be worsened in auditorially busy environments when he feels stressed. We test him in a very contained and contrived laboratory setting. His functioning decreases to profound weaknesses when his input medium is the written word.

Q. So Dr. Stambrook, could Mr. Luxton follow written instructions?

A. That would be very improbable. Mr. Luxton has difficulty in simply pronouncing words. He cannot do the analysis of the sort of visual pattern and connect that with the kind of sounds that is so implicit in the kind of reading, writing, interpretation that all of us take so much for granted.

With respect to memory Dr. Stambrook testified that the Appellant is in the low average range overall. His visual memory, not using words, has some excellent features. But he functions in the low average range regarding language based memory. It takes him a little bit longer to get there. The witness repeated that the Appellant has no ability to read. He added that there is no available existing therapy to help him. His wife and, in time, his children may read for him.

Cross-examination of the Appellant followed.

In the course of the cross-examination it was established that the Appellant has been employed for the last seven years as a welder for INCO. His job is not in jeopardy. He has secure, long-term employment. But the witness did not go into the Appellant’s job performance. He said that was not the purpose of his assessment [2] .

The witness agreed that perception involves an ability to essentially obtain sensory information and to process it. He also agreed that one way to examine whether someone is exhibiting appropriate perceptive skills is to ascertain if he or she is able to communicate a response in an appropriate manner. He found the Appellant responsive: “He was very pleasant and interactive.” He communicated in an understandable way. The witness had been informed by the Appellant’s wife that her husband had a vocational high school education, but he had not reviewed his academic transcripts. These exchanges followed between counsel for the Respondent and Dr. Stambrook:

Q. Your report indicates that his overall level of intellectual functioning was found to be at the low end of the average range. In other words, it was in the average range, but at the low end of the spectrum?

A. That is correct.

Q. So it was not in fact in the low range?

A. His overall intellectual skill, given the context I spoke of earlier, was in the low end of the average range, not the low average range.

Q. And that the fact he has quite a — well, he is at the low end with respect to certain skill levels, that he is in fact at a high level with - in a higher percentile with respect to visual and spatial?

A. In general terms, although there are some exceptions, yes.

Q. Would a person who was more reactive to visual or spatial stimuli, for example, find that a great deal of his information would be processed by, for example, in the supermarket, looking at the cans on the shelves?

A. He would have to have used more visual stimulation, yes.

Q. So the picture on the can as opposed to lettering?

A. Absolutely.

Q. Okay. And would that apply as well to — did you have occasion to assess his ability to analyze diagrams or plans?

A. Not plans per se, but I would not anticipate if it was just looking at the visual, spatial components, he’s going to have marked difficulty with that. His visual, spatial skills were well developed.

Q. In fact is it safe to say they were above average?

A. In some areas they were above average, absolutely.

Q. So this is a person who can presumably then process certain information of a visual nature at a superior rate?

A. I wouldn’t say superior. Above average is where he went with that.

Q. High average, is that right?

A. High average, yes, yes.

Dr. Stambrook said that the Appellant was socially capable of communicating. The fact that the Appellant had an unrestricted driver’s licence was mentioned again. The evidence then turned to the home environment. Counsel for the Respondent asked these questions and received these answers.

Q. Did you do any kind of home assessment to see what his functions were in the home setting?

A. No, that wasn’t the focus of the assessment. There was no home assessment. The assessment took place in my office in Winnipeg in a clinical office assessessment and in a laboratory psychometry assessment.

Q. So I take it then that you are not really in a position to give evidence as to what his capabilities in a home setting would be then?

A. Only by the information presented to me by Mr. Luxton and his spouse.

Q. And did you in the occasion of the preparation of your report have occasion to actually review the legislation?

A. I reviewed no legislation.

Q. And were you given any kind of copy of any guidelines or any information as to what Revenue Canada’s position is?

A. No. The first time I think I spoke to Mr. Luxton was after - or Mr. Schmalcel after the assessment. I only met with him two - or last week I believe I met with him.

Q. Dr. Stambrook, do you understand the concept of what are basic activities of daily living?

A. I do, yes.

Q. And do you have an opinion as to what those basic activities consist of?

A. As soon as we agree on what the definition of activities of daily living are. In my context, they mean the ability to dress, the ability to be independent in ambulation, being continent for urine and feces, being able to carry out basic activities of meal preparation, getting around the community, yes.

Q. Okay. Would it be your assessment that Mr. Luxton is capable of all of those functions ?

A. He is.

The only other witness at the hearing was the Appellant’s wife. She is a nurse. They were married five years ago. She gave this example regarding the Appellant’s memory. If he goes to the store to purchase four items he must rely on his memory because there is no point in describing them in writing. If he returns with three, the witness is pleased. She said that her husband had great difficulty in learning her maiden name which is Gerkowski. If a new appliance is brought into the home, the Appellant is quick to learn its basic functions, but he has to be reminded about that. Mrs. Luxton said this about banking:

A. Like everyday banking and stuff like that, like even the simplest things, to do all the bills and that. Like he’ll know that there’s the bills that have to be paid, but the goings on of them, what’s coming on the statement, he can’t read what’s on the statement. The bank statements, he knows that we’ve done certain transactions. He’ll relate that to money, but as far as relating what it was for, sometimes he needs — need to cue him as to what was happening in those areas. That’s the best I can —

Q. Okay. Who does the banking in the house?

A. Basically I do. If there’s deposits and that and stuff for transferring, simple stuff that I can get him to go and do, that’s fine. Even using the ATM machines, if it isn’t a familiar, you know, withdraw cash, deposit cash, simple things. But if a message comes up and says that the ATM is unable to transact this due to da-da-da, he wouldn’t be able to — you know, he would just come home and say, “The machine didn’t take the card and I couldn’t deposit”. So then I would go to the machine and find out and here it would be something like the machines are down due to some other incident or something like that.

What follows is the full text of the cross-examination of Mrs. Luxton:

Q. Is it safe to say, Mrs. Luxton, that you and your husband essentially divide up some of the duties in the house?

A. Yes, yes.

Q. So he does some of the — he perhaps does more — some of the more physical things?

A. Yes, yes.

Q. And you take care of the banking and some of the other -

A. Yes, yes. We share actually all the work, as much as we can. When it comes to anything that has to do with anything that requires thinking and actual doing of, I usually do that portion of it.

Q. Well —

A. The physical portion of it is —

Q. But your husband does operate the VCR and all the other equipment in the house?

A. Yes.

Q. And as I understand it - do you have any children?

A. We have one daughter.

Q. So you are not really into the errands running off to classes and everything yet?

A. Oh, yes, we are actually already.

Q. And the both of you look after that?

A. Yes, we do. We both work.

Q. Do you work shifts?

A. Yes, I do.

Q. And your husband works shifts as well, does he?

A. No, he works straight days.

Q. That must be nice.

A. Yes.

Q. So presumably, depending on who is available, some of these things get carried out?

A. Yes.

Q. Does your husband prepare meals?

A. Yes.

There was no re-examination.

The nature of the relevant provisions of the Act indicate to me that the disposition of appeals involving claims for a disability tax credit must depend on their own particular facts. The onus is on the Appellant to establish on a balance of probability that the reassessment is in error. In order to do so he must, applying that standard of proof, show that his ability to perform the basic activity of daily living that involves perceiving, thinking and remembering is markedly restricted [3] .

In Parsons, Bowie J.T.C.C. said with reference to subsections 118.3(1) and 118.4(1) that in order for a taxpayer to qualify for a disability tax credit he must meet rigorous requirements. “Parliament intended the deduction to be available only to individuals who suffer from the most extreme disabling conditions.” He went on to add: “I also agree with Judge Bowman’s opinion (in Lawlor) that the legislation should be interpreted ‘with a degree of compassion and understanding that achieves the objective of this section’.” The section referred to is section 118.4 of the Act.

The Appellant has failed to discharge the onus resting on him to establish that the reassessment is incorrect. Indeed, regarded in its totality, the evidence affirmatively confirms the correctness of the reassessment. While the Appellant has profound problems with reading and writing that would not, of itself, entitle him to the tax credit. Dr. Stambrook said that the Appellant’s overall level of intellectual functioning was in the average range albeit at the low end. On the other hand his visual, spatial skills were well developed. Actually, in some areas they are above average. His employment record points to the validity of the reassessment as does his unencumbered licence to drive an automobile. As for the ability of the Appellant to function in his home environment Mrs. Luxton’s evidence speaks for itself in this regard.

The appeal is dismissed.

Appeal dismissed.