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It is not easily discharged, particularly as the services of counsel were only obtained a few hours before the case began. 4.02.2 The main evidence presented by the appellant concerns municipal and school tax bills (Exhibits A-1 to A-5, see paras 3.02 to 3.04); the evidence is that these tax bills, filed at the hearing by the appellant (Exhibit A-6), were taken into consideration by the respondent’s assessor in preparing the assessment. ...

On organization and at all material times, the issued and outstanding shares of Cuisson were owned by the following: Gibraltar Mines Ltd 40 % Placer Development Limited 29 /2% Gunn Mines Ltd 30 % By contract dated November 23, 1973, Exhibit 2, among Placer (the parent company of Gibraltar) Gibraltar and Gunn, arrangements were made as to how Cuisson was to be financially operated: it gave Cuisson authority to enter into a mineral agreement with Gibraltar in respect to Cuisson’s Granite Lake claims, authority to provide for the management of Cuisson and for the further examination, exploration development and mining of the Granite Lake claims of Cuisson in conjunction with, concurrently and consequently with the continuous and adjacent mineral claims of Gibraltar in such manner and upon and subject to such terms and conditions and for such consideration, all as the Board of Directors of Cuisson may approve. ...

It has already been noted in this decision that the correspondence between the parties (Exhibit A-3), which is the only documentation prior to that date, does not fulfill the requirements of the “written separation agreement” called for under paragraph 60(b) of the Act, irrespective of whether they might fulfill the requirements of that section for purpose of consideration as “alimony or other allowance payable”. ...

As a result, the transfers are not allowable to a deduction pursuant to the provisions of paragraph 18(1)(a) of the Income Tax Act which reads as follows: 18. (1) In computing the income of a taxpayer from a business or property 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 the business or property; Furthermore, the said transfers could not be considered a bad debt within the meaning of paragraph 20(1)(p) of the Act which reads as follows: 20. (1) Notwithstanding paragraphs 18(1)(a), (b) and (h), in computing a taxpayer’s income for a taxation year from a business or property, there may be deducted such of the following amounts as are wholly applicable to the source or such part of the following amounts as may reasonably be regarded as applicable thereto: (p) the aggregate of debts owing to the taxpayer (i) that are established by him to have become bad debts in the year, and (ii) that have (except in the case of debts arising from loans made in the ordinary course of business by a taxpayer part of whose ordinary business was the lending of money) been included in computing his income for the year or a previous year; From all the evidence before me, I hold that the debt owed to the appellant by the related companies arose from an advance of capital to them and that such loans, or shall I say the supplying of capital by way of inventory, by the appellant, was not made for the purpose of gaining or producing income from a business or property and, in consequence thereof, the loss arising from the related companies which failed to pay the appellant for the transfers of inventory is deemed to be nil by virtue of subparagraph 40(2)(g)(ii) which reads: 40. (2) Notwithstanding subsection (1), (g) a taxpayer’s loss, if any, from the disposition of a property, to the extent that it is (ii) a loss from the disposition of a debt or other right to receive an amount, unless the debt or right, as the case may be, was acquired by the taxpayer for the purpose of gaining or producing income from a business or property (other than exempt income) or as consideration for the disposition of capital property to a person with whom the taxpayer was dealing at arm’s length, See North West Tent & Awning Co Ltd v MNR, [1976] CTC 2332; 76 DTC 1227. ...

Counsel also pointed out that the car accident and the insurance court case referred to in the application took place in a time frame other than the one under consideration. ...

It was stated in evidence that there was good and valuable consideration for the sale and that statement was in no way disputed. ...

That is, in the event that the sole matter at issue before the Board was the lack of usual documentation for the amounts claimed, the Board might be entitled to take his sworn testimony into serious consideration. ...

The respondent, however, does not dispute the amount of $24,334. 3.02 By agreement (Exhibit A-1, Tab 1) dated as of January 1, 1971, (the “Manufacturing Agreement”) between C H Boehringer Sohn and Ciba- Geigy Canada Limited, the parties agreed, among other things, as follows: (a) certain previous agreements dating back to January 1, 1957, were terminated effective December 1, 1972; (b) some services previously provided by Ciba-Geigy were to be undertaken by a Canadian company to be incorporated by C H Boehringer Sohn, which is the appellant; (c) new product development previously undertaken by Ciba-Geigy was to be undertaken by the appellant, and all product promotions previously undertaken by Ciba-Geigy were to be undertaken by the appellant; (d) for a four year period commencing January 1, 1973, Ciba-Geigy had agreed to manufacture, package and distribute certain products on behalf of the appellent for a consideration which consisted of a reimbursement of its costs, together with a “margin equal to twenty three and one half per cent of the actual net sales”, as defined in the manufacturing agreement. 3.03 The termination of the agreement is provided for in section 16, which reads as follows: 16. ...

Well, at that particular time, sir, we figured, like, ten per cent, if we net ten per cent of the rent, but we didn’t take into consideration, like, the gross and the expense, but we figured if we bought it, like, at $17,500 and we are renting it for $185 this is ten per cent. ...

I have given very careful consideration to the reasoning in the judgment rendered by my learned colleague Guy Tremblay, Esq, CGA, in Belgen Inc v MNR, [1978] CTC 2099; 78 DTC 1067. ...