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The problem whether royalties received through holding and licensing patents and performing patent licensing agreements should be regarded as profits of a trade was considered by the Court of Appeal in England in C.I.R. v. ... Rather, I think the correct inference is that the appellant had nothing to do and did nothing in 1957 in performance of the agreement or to assist or promote the business of the licensee, because the parent went ahead and did everything that the contract required the appellant to do or which was considered desirable or advantageous. ...

Though the tenant inducement might well be considered reasonable within the meaning of section 67 of the Act, the reality is that the two partners have done no more than move a sum of money from one pocket to the other in the hope that they would reap the benefit of certain tax advantages. ... Thus, I am of the opinion that the agreement to pay the tenant inducement payment of $1.2 million was of no legal consequence and that it cannot be considered an outlay or expense made for the purpose of gaining or producing income within the meaning of paragraph 18(1)(a) of the Act. [20]      Hindsight reveals that the tax strategy pursued by the taxpayers was doomed to failure once the decision was made to acquire and develop the lands through an agent and bare trustee rather than the conventional "holding" corporation. ...

Heckendorn's facts as he has set them out in his Statement of Claim as if proven, except where too far-fetched to be credible and here I do not accept, as if proven, the allegation that the Income Tax Act does not exist. [8]                I have considered the Crown's affidavit material only to the extent that it goes to jurisdiction, or deals with matters said to be frivolous or an abuse of process of the Court, the latter being permissible in that the Defence, in paragraph 15, reserves to the Defendants the ability to argue that the claim is without merit, is an abuse of process and is frivolous. ... Carey Canada Inc. [1990] 2 S.C.R. 959 at 980. [10]            As I have already observed it is established law that the facts alleged in the Statement of Claim are, unless so far-fetched as to be unbelievable, for the purposes of the motion considered as if proven. ...

Analysis [8]      Subsection 56(4) of the Act states: Where a taxpayer has, at any time before the end of a taxation year, transferred or assigned to a person with whom the taxpayer was not dealing at arm's length the right to an amount (other than any portion of a retirement pension assigned by the taxpayer under section 65.1 of the Canada Pension Plan or a comparable provision of a provincial pension plan as defined in section 3 of that Act) that would, if the right had not been so transferred or assigned, be included in computing the taxpayer's income for the taxation year, the part of the amount that relates to the period in the year throughout which the taxpayer is resident in Canada shall be included in computing the taxpayer's income for the year unless the income is from property and the taxpayer has also transferred or assigned the property. [9]      The transfer of the right to trailer fees has never been considered under subsection 56(4). ... Hicks considered would continue to be personally accountable for providing the services after the incorporation. ...

Dale (supra), considered that this finding was inconclusive, and that there was fallacy in the use of the word ‘‘enduring’’, and stated that “What Lord Cave is quite clearly speaking of is a benefit which endures, in the way that fixed capital endures, not a benefit which endures in the sense that for a good number of years it relieves you of a revenue payment.’’ ... And, therefore, I am unable to find that by ceasing to use the main valve testing tool in 1958 the appellant could be considered to be pro tanto going out of any part of its business. ...

., [1976] C.T.C. 358, 76 D.T.C. 6196 (F.C.T.D.) wherein it was held that all factors had to be considered and the necessity of weighing each in relation to the others. ... Also, he wrote that whether an isolated transaction can be considered an adventure in the nature of trade cannot be determined solely upon the basis of intention at time of purchase. ...

He was asked specifically whether the plaintiff would have considered the various contracts to be completed prior to such approval being given, and he repeatedly answered in the negative. ... And would Wil Mechanical have considered this work completed prior to the engineer's approval? ...

Counsel also stressed the point that during most of the time the Cameron Farm was actually used as an investment for the purpose of yielding rental income to the partnership from the pasture and the farmhouse, which was another relevant factor to be considered according to the authority of M.N.R. v. ... Justice Urie had to determine whether a change of intention on the part of the most active member of a consortium could be considered in the determination of the taxability of his profits from the sale of a residential and commercial property, or whether it was the intention of the consortium as a whole which prevailed. ...

Those losses were considered limited partnership losses within the meaning of subsection 96(2.1) of the Act. ...   [39]     Counsel noted that the losses disallowed under subsection 96(2.2) of the Act were considered limited partnership losses within the meaning of subsection 96(2.1) of the Act and that, under paragraph 111(1)(e) of the Act, they could be carried forward against the partnership's income attributed to the limited partners in 1998.   ...

I have also considered Reeves' assertions that neither the appellant nor its partners ever contemplated the possibility of resale at the time of purchase; his statement that ” It didn't cross our minds to resell it at that point" and his expressed philosophy "When I buy a property, I never think of reselling it as far as trying to make a profit. ... Other evidence to be considered is the appellant's awareness of the state of the real estate market in Weslaco. ...