Bell
T.C.J.:
The
four
Appellants
were
involved
in
five
different
general
partnerships
engaged
in
the
business
of
building
office
buildings
for
sale.
As
a
result
of
a
down-turn
in
the
market
non-capital
losses
(“original
losses”)
were
suffered
in
1982
and
subsequent
taxation
years.
The
Appellants,
based
upon
decisions
of
the
Managing
Partner,
seek
to
deduct
amounts
in
respect
of
a
given
taxation
year
arising
from
recomputations
of
losses
for
that
year
(“increased
losses”)
made
in
a
later
year
and
allocated
to
certain
partners
on
a
basis
other
than
their
pro
rata
partnership
interests
in
the
given
taxation
year.
The
proceeding,
which
was
intended
to
be
a
hearing
of
the
issues,
evolved
into
the
presentation
of
questions
of
law
pursuant
to
the
provisions
of
section
58
of
the
Tax
Court
of
Canada
Rules
(General
Procedure).
That
section
reads
in
part
as
follows:
58.(1)
A
party
may
apply
to
the
Court,
(a)
for
the
determination,
before
hearing,
of
a
question
of
law
raised
by
a
pleading
in
a
proceeding
where
the
determination
of
the
question
may
dispose
of
all
or
part
of
the
proceeding,
substantially
shorten
the
hearing
or
result
in
a
substantial
saving
of
costs,...
and
the
Court
may
grant
judgment
accordingly.
(2)
No
evidence
is
admissible
on
an
application,
(a)
under
paragraph
(1)(a),
except
with
the
leave
of
the
Court
or
on
consent
of
the
parties,...
The
parties
agreed,
with
the
Court’s
approval,
that
the
Notice
of
Appeal
would
be
amended
to
permit
questions
of
law
in
the
form
set
forth
below
to
be
heard.
They
agreed,
with
leave
of
the
Court,
that
evidence
would
be
admissible.
The
amendments
to
the
Notices
of
Appeal
in
each
Appellant’s
case
can,
in
order
to
state
the
essence
of
the
questions
of
law,
be
rephrased
as
follows:
1.
Is
an
Appellant
entitled,
in
accordance
with
the
provisions
of
the
Income
Tax
Act
(“Act”),
to
deduct
the
non-capital
loss
for
a
given
taxation
year
as
increased
by
a
recomputation
of
that
loss
made
in
a
subsequent
taxation
year?
2.
If
the
amount
of
loss
is
increased
by
recomputation
made
in
a
subsequent
year,
in
which
taxation
year
is
such
amount
of
loss
deemed
to
have
been
suffered?
3.
Which
partners
are
entitled
to
deduct
the
increased
losses:
(a)
the
partners
in
the
year
in
which
the
original
losses
were
claimed,
or
(b)
the
partners
in
the
year
in
which
the
increased
losses
were
computed?
4.
Was
the
Managing
Partner
entitled
to
allocate
the
increased
losses
to
partners
who
had
made
cash-call
contributions
in
excess
of
their
per
unit
partnership
interest
and
to
partners
who
had
provided
services
in
attempts
to
resolve
outstanding
financial
issues?
Determination:
A
taxpayer
will
have
received
a
“nil”
assessment
for
a
taxation
year
in
which
he
suffered
a
net
loss.
That
taxpayer
is
entitled
to
deduct
an
increased
loss
for
a
given
taxation
year
determined
by
a
valid
recomputation
thereof
in
a
subsequent
taxation
year.
Such
taxpayer
is
entitled
to
this
deduction
in
the
taxation
year
in
respect
of
which
the
loss
was
suffered
—
not
in
the
year
of
recomputation.
It
is
the
members
of
the
partnership
in
the
year
in
which
the
loss
was
suffered
that
are
entitled
to
deduct
their
respective
shares
of
the
increased
loss.
Having
regard
to
the
foregoing,
the
fourth
question
is
answered
in
the
negative.
If
a
taxpayer
received
a
“nil”
assessment
for
the
taxation
year
in
which
he
suffered
a
non-capital
loss
he
can
recompute
that
loss
and
deduct
it
for
the
taxation
years
specified
in
paragraph
111(1
)(a),
namely,
the
three
prior
taxation
years
and
the
subsequent
seven
taxation
years.
Subsection
152(1.1)
provides,
without
limitation
as
to
time,
that
a
taxpayer
may
request
the
Minister
to
determine
the
amount
of
a
non-capital
loss
for
a
given
taxation
year.
That
subsection
only
applies
when
the
Minister
ascertains
the
amount
of
the
non-capital
loss
to
be
different
from
the
amount
reported.
The
determination
is
subject
to
all
the
normal
appeal
provisions
of
the
Act.
In
short,
a
taxpayer
can
in
the
above
circumstances,
at
any
time,
obtain
a
determination
of
non-capital
loss
in
respect
of
any
year
for
which
a
nil
assessment
is
made.
However,
any
non-capital
loss
increased
by
that
determination
can
only
be
deducted
from
income
in
any
of
the
taxation
years
referred
to
in
section
111(1)(a).!
Costs
will
be
in
the
cause.
Order
accordingly.
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