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In computing his income for that year the appellant, who carries on the practice of dentistry in Toronto, claimed as deductible expenses the sum of $926.50, made up of: Tuition fees $415.00 Airplane fare 112.00 Miscellaneous expenses 231.00 Hotel expenses 168.50 paid out by him in connection with his attendance at a course at the College of Dentistry at New York University. ... I also find that the appellant’s consultations with the faculty members in connection with specific patients were incidental to the taking of the course and were not an impelling reason for his trips to New York. ... It must be looked at in the light of its connection with the operation, transaction or service in respect of which it was made so that it may be decided whether it was made not only in the course of earning the income but as part of the process of doing so. ...

(In this connection, it is agreed that in respect to the bequest to The Harshman Foundation by the will of Hubert Harry Harshman deceased, that there should in any event be deducted from it, if the appellant should succeed on this appeal, the proper capital amounts which for estate tax calculation constitute the limits of the discretion given to the trustees under the will to encroach on the residue of the estate in favour of the deceased’s widow which power of encroachment is provided in paragraph 9 of the will and permits an encroachment of the income up to the sum of $10,000 in any one year and an encroachment upon the capital during the lifetime of the wife to an amount not exceeding in the aggregate 30,000.) ... The respondent in argument, submitted that “The Harshman Foundation’’ referred to in these proceedings was: (1) a chari- table trust and not a charitable organization within the meaning of Section 7(1)(d) of the Estate Tax Act; and in this connection referred to the similarity of language employed in Section 62(1) (e) of the Income Tax Act which exempts from taxation the income of certain charitable organizations in contradistinction to the language employed in Section 62(1) (g) of the Income Tax Act which is concerned with the exemption from taxation of the income of certain charitable trusts; and (2) that the gifts either in lifetime or by the will of the decedent were not “absolute and indefeasible’’ within the meaning of Section 7(1) (d) of the Estate Tax Act. ... In other words, the appellant submitted that the testator using a trust structure in fact created an ‘‘organization in Canada’’ within the meaning of Section 7(1) (d); and in this connection, the appellant relied in particular on the concluding words of the subsection, namely, that such an organization in Canada may itself be set up for the purpose of ‘‘the making of gifts to other such organizations in Canada all or substantially all of the resources of which’’ are devoted to charitable activities carried on or to be carried on by them. ...

In the course of its expansion the time came when Sobeys Stores found it advisable to issue debentures, and in that connection it entered into a Deed of Trust and Mortgage (Exhibit A-9) with The Nova Scotia Trust Company, as trustee, to secure the debentures and thereby mortgaged and gave a floating charge on all its real and personal property and assets, then owned or thereafter acquired. ... City Council favoured construction of the bridge in the north end of the city and the widening of Robie Street in that connection. ... There was trouble with Butler in connection with the Bayer’s Road site. ...

That the Party of the Second Part will manage the execution of the said project, carry on the work of construction, supervise all field operations, set up efficient construction systems, and perform all services, technical and otherwise, that may be required, and keep books of account and cost records in connection therewith. ... Poitras et al., 44 R. de J. 63 at 74, where the importance of the intention of the parties is stressed and where, in this connection, the following admonition is found: “On ne doit par recourir aux autorités anglaises, vu qu’il semble que les principes du droit anglais sur ce point ne sont pas semblables aux nôtres. ’ ’ Planiol & Ripert, Droit Civil, Vol. 11, p. 236: “981 5° aux quatre éléments énumérés ci-dessus on en ajoute généralement un cinquième consistant dans Vaffectio societatis, c’est-à-dire l’intention de former une société ou, de façon plus exacte et plus précise, la volonté de coopérer en acceptant délibérément certains risques. ... In the above connection, counsel for the respondent drew attention to the fact that Exhibit A2, which brought about the eancellation of the agreement, mentions that it was ‘‘subject to a rendering of accounts between them, all Parties reserving such rights and recourses as to them in law and justice appertain in the premises.’’ ...

Shifrin made the collections, attended to necessary insurance and had possession of all documents in connection with the mortgages. ... In perusing Exhibit 2, which contains some obvious typographical errors and omissions, I found one mortgage transaction (Anthony-Wilkie, No. 37) in which the principal fell due in something over three years; the Jasper Hotel mortgage (No. 12) fell due in a little over two years; and the same was true in connection with No. 15, The Quinte Hotel. ... The respondent testified that he never resorted to advertising in connection with his mortgage transactions—and whether or not Mr. ...

At p. 27 of the transcript he had this to say in this connection: “Q. ... This decision was confirmed on appeal and at p. 255 Mac- naughten, J., in connection with the matter of intention had this to say: “The question, therefore, is whether a person who buys endowment policies with no intention of selling them is engaged in a concern in the nature of trade. ... Considerable emphasis was laid by counsel for the appellant on the fact that no resort was made to advertising in connection with the mortgage operations of the taxpayer; it appears, however, that there was no necessity for so doing as the taxpayer admitted it had more demands than it could satisfy. ...

The aecount at The Bank of Nova Scotia had been used mainly, if not entirely, to deposit receipts and pay expenses of an apartment building which he had acquired and the account at The Provincial Bank had been similarly used in connection with a dwelling house which he had let to a tenant. ... It was said first that the deceased’s intention in establishing the joint account was merely to provide a convenient means of transacting his business and in this connection reference was made to Marshall v. ... In addition there is evidence that his purpose was to confer a benefit on her and there is also the fact that in connection with his apartment building and rented house he kept the bank accounts in his own name. ...

Wilson and the goodwill thereof, all goods, stock-in-trade, furniture, machinery, store fittings and plant together with the benefit of all contracts subsisting in relation to the said business, all book debts owing to me in connection with said business and all securities for money, cash and money in bank to the credit of the said business subject to my said son complying with the following terms, namely: ’ ’ and then, omitting sub clauses (a), (b) and (c) not here relevant, the said will continued: “(d) Entering into a covenant under seal with my wife binding himself and his executors and administrators to pay to her during her lifetime the sum of $500.00 each and every month on the first day thereof in advance, the first of such payments to be made on the 1st day of the month next following my death; (e) Entering into a covenant under seal with my said wife and my Trustees, binding himself and his executors and administrators, whereby he shall covenant that during the lifetime of my wife or until the same be sold, whichever event shall the earlier happen, he or they will pay all taxes, local improvement charges, insurance premiums and expenses of all ordinary repairs to the upkeep of the fabric of my residence known as number 811 St. ... In computing the amount of the profits or gains to be assessed, a deduction shall not be allowed in respect of (a) disbursements or expenses not wholly, exclusively and necessarily laid out or expended for the purpose of earning the income; (b) any outlay, loss or replacement of capital or any payment on account of capital or any depreciation, depletion or obsolescence, except as otherwise provided in this Act; (c) the annual value of property, real or personal, except rent actually paid for the use of such property, used in connection with the business to earn the income subject to taxation;” For the taxation year 1949 the Income Tax Act is applicable, its relevant provisions being as follows: “12. (1) In computing income, no deduction shall be made in respect of (a) an outlay or expense except to the extent that it was made or incurred by the taxpayer for the purpose of gaining or producing income from property or a business of the taxpayer, (b) an outlay, loss or replacement of capital, a payment on account of capital or an allowance in respect of depreciation, obsolescence or depletion except as expressly permitted by this Part, (d) the annual value of property except rent for property leased by the taxpayer for use in his business,” It is not contended that in this case there is any substantial difference between these provisions of the Income War Tax Act and the Income Tax Act. ... It was contended by the Company that it was illogical that while legitimate expenses incurred in the production of the income are deductible, similar expenses incurred for the much more important purpose of keeping the profit-making business alive are not deductible, and, further, that it was inequitable that the Legislature should, on the one hand, force a certain class of traders into a struggle for their very existence, and, on the other hand, treat the reasonable expenses incurred in connection with such struggle as part of the profits assessable to income tax. ...

That the Party of the Second Part will manage the execution of the said project, carry on the work of construction, supervise all field operations, set up efficient construction systems, and perform all services, technical and otherwise, that may be required, and keep books of account and cost records in connection therewith. ... Poitras et al., 44 R. de J. 63 at 74, where the importance of the intention of the parties is stressed and where, in this connection, the following admonition is found: “On ne doit par recourir aux autorités anglaises, vu qu’il semble que les principes du droit anglais sur ce point ne sont pas semblables aux nôtres. ’ Planiol & Ripert, Droit Civil, Vol. 11, p. 236: “981 5° aux quatre éléments énumérés ci-dessus on en ajoute généralement un cinquième consistant dans Vaffectio societatis, c’est-à-dire l’intention de former une société ou, de façon plus exacte et plus précise, la volonté de coopérer en acceptant délibérément certains risques. ... In the above connection, counsel for the respondent drew attention to the fact that Exhibit A2, which brought about the eancellation of the agreement, mentions that it was ‘‘subject to a rendering of accounts between them, all Parties reserving such rights and recourses as to them in law and justice appertain in the premises.’’ ...

The amounts of the several items of expense just mentioned are not in dispute. (1) Premium paid upon retirement of the issue of old bonds $1,104,600.00 (2) Exchange premium paid upon retirement of the issue of old bonds 676,726.00 (3) Expenses in connection with the retirement of the issue of old bonds 25,793.42 (4) Discount on the issue of new bonds: $ 5,000,000 par value at 114 per cent $ 75,000 $10,000,000 " " 4 11 " 400,000 475,000.00 Total $2,282,079.42 I perhaps should here add by way of explanation that there was a provision in the trust deed securing the old bond issue which required the payment of a premium of 4% in the event of redemption before maturity. ... In the United States, expenses incurred in connection with the refunding or retirement of bond issues are governed by a set of rules issued by the Treasury Department in 1938, and it is probable that there, under such rules, the disbursements here would be allowed as deductions. ... Batty (1919), 7 Tax Cas. 158, it was held that costs incurred in connection with the reduction of capital were inadmissible as a deduction, because it was not a reduction of capital made for the purposes of the trade of the company. ...