A J Frost:—This appeal is from an income tax assessment in respect of the appellant’s 1968 taxation year. The appeal was heard at Toronto, Ontario, on October 26, 1971, by the Tax Appeal Board as it was then constituted.
The appellant held a Goodyear Tire Dealer franchise and as well operated a re-treading establishment. Its president, Mr Robert A Hands, took ill in 1964 and in 1966 decided he could no longer carry on with his business. The appellant ceased operations in April 1967 and, by Bill of Sale dated March 30, 1967, sold certain goods and chattels to James Walker and his wife Mary Walker for $20,000. It did not sell its inventory of goods on hand and decided to collect its own accounts receivable.
The president of the appellant company owned the building and rented it to Canadian Tire Corporation Limited. The Goodyear Tire & Rubber Co of Canada, Ltd transferred its dealer franchise to Mr Walker. The appellant company is still in existence but inactive.
The bill of sale for goods and chattels indicates that the transaction was not the sale of a business as a going concern. The facts of the case are inconsistent with Mr Hands’ contention that Hands Tire Sales Limited sold its goodwill to Mr Walker. The latter purchased goods and chattels at a price agreed to by the parties and then removed his goods and chattels to another place two miles away and carried on business under a different name.
In my opinion the sale to Mr Walker is a sale of goods and chattels and not the sale of an established business as a going concern. Under the circumstances goodwill cannot be considered as an element in the transaction.
Appeal dismissed.
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