Search - consideration

Two days after the ARQ had issued a statement of account to Construction LMA showing that it had failed to remit over $527,000 in sales taxes and employee source deductions, Larocque transferred his residence, which was mortgaged to a bank to secure debt owing to the bank by Construction LMA, to a newly formed trust (of which he was the beneficiary and one of the two trustees) in consideration for the assumption of the bank debt. ... Tremblay JCQ, noted that, in fact, Larocque had continued to service the bank debt, so that the consideration received by him from the trust for the transfer by him was “purely fictitious” and that the purported assumption of the bank debt was a “sham”. However, the ARQ could not now reverse its assessing position, as “the determination of the value of the consideration must be made at the time of the transfer”. ...

An exception should also be included in s. 85.1(4)(a)(i)(B) for non-share consideration described in s. 85.1(3)(a), so that the transfer of such non-share consideration (or property that derives its value from such non-share consideration) would not affect the application of s. 85.1(3). ...

In its new Folio on the prohibited investment rules, CRA states that this test is not restricted to consideration of the voting rights of the shares: [T]he phrase governance of the investment entity should be given a wide meaning. ... CRA provides an example of a situation where it would give “favourable consideration” to waiving under s. 207.6(2) the 100% advantage tax. ...

8 March 2017- 12:18am InterOil – Yukon Supreme Court indicates that all plans of arrangement must be accompanied by a fairness opinion prepared on a fixed fee basis Email this Content A decision of the Yukon Court of Appeal reversed approval of the plan of arrangement for the acquisition of InterOil by ExxonMobil on the basis inter alia that the Circular did not contain information permitting InterOil shareholders to properly assess the adequacy of contingent cash consideration to be paid to them based on the subsequently-measured size of InterOil’s natural gas resource. ExxonMobil then returned with an offer that was essentially the same, except that the contingent cash consideration was capped only once the resource size reached a quite unlikely level. ...

22 August 2017- 12:41am Tembec is to be acquired by Rayonier AM or a sub of Rayonier AM for 2/3 cash and 1/3 Rayonier AM shares Email this Content Tembec, which is a TSX-listed CBCA corporation, agreed to a CBCA Plan of Arrangement with NYSE-listed Rayonier AM under which its (common) shares were to be acquired by Rayonier AM for consideration (at each Tembec shareholder’s option) of C$4.75 cash or 0.2542 of a Rayonier AM common share – except that proration would occur so as to result in the overall consideration being more or less fixed at 67% cash and 33% shares. ...

23 October 2017- 12:26am Findmypast – Inner House of the Court of Session finds that the time of a supply of services was accelerated by prepayment only where the services were precisely identifiable Email this Content ETA s. 152(1) provides that GST/HST for a taxable supply becomes payable if the consideration is prepaid. However, ETA s. 168(6) provides that where the value of consideration for a taxable supply is not yet ascertainable, there is a corresponding deferral of the date on which the related GST/HST becomes payable. ...

(iii)(B) of Paragraph N that “the disposing corporation [FA1] receives no consideration for the share [of FA2] other than property that was, immediately before the merger, owned by the issuing corporation [FA2] and that, on the merger, becomes property of the new corporation [FA1].” ... [Thus] the property of FA3 would be received by FA1 as consideration for the shares of FA2. ...

8 January 2018- 1:08am CRA rules that the purchase of an IP royalty gives rise to non-creditable GST/HST to the investor unless there is a specified minimum royalty Email this Content A Canadian registrant (Investor) enters into an agreement with a Canadian corporation (Corporation 1) under which it pays lump sums in consideration for the right to receive monthly royalties calculated as a percentage of intellectual property (IP) related revenue streams of Corporation 1. CRA ruled that the lump sums so paid are consideration for the taxable supply to Investor of intangible personal property (the right to the royalty payments). ...

For example, Father transfers shares of Opco (a small business corporation whose shares are eligible for the CGE) to his children in consideration for a note that is payable over 10 years, claims the capital gains reserve, but does not claim the CGE. The children transfer the Opco shares to a new Holdco in consideration for a note of Holdco, with a view to Opco dividends funding note repayments. ...

He further found that “there has been an evolution in the doctrine of consideration in the context of contract modifications,” so that now “when parties to a contract agree to vary its terms, the variation should be enforceable without fresh consideration, absent duress, unconscionability, or other public policy concerns.” ...