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Although an owner-operator may be hired under a contract of service, each case is generally considered in accordance with the circumstances surrounding it. However, it may be concluded that, where the contract of employment of an owner-operator meets the conditions stated in paragraph 7, that employment is considered as being held pursuant to a contract of service.   7.         ...

" the appellants within the meaning of paragraph 256(1) (a) of the Income Tax Act. [8]      Subsection 256(5.1) reads: For the purposes of this Act, where the expression "controlled, directly or indirectly in any manner whatever," is used, a corporation shall be considered to be so controlled by another corporation, person or group of persons (in this subsection referred to as the "controller") at any time where, at that time, the controller has any direct or indirect influence that, if exercised, would result in control in fact of the corporation, except that, where the corporation and the controller are dealing with each other at arm's length and the influence is derived from a franchise, licence, lease, distribution, supply or management agreement or other similar agreement or arrangement, the main purpose of which is to govern the relationship between the corporation and the controller regarding the manner in which a business carried on by the corporation is to be conducted, the corporation shall not be considered to be controlled, directly or indirectly in any manner whatever, by the controller by reason only of that agreement or arrangement. [9]      The facts are not particularly in dispute. ...

The appeals were heard in two stages and it was when the hearing resumed that the respondent filed in evidence a corrected version of the Schedule attached to his Reply to the Notice of Appeal, which version reflected and considered some information adduced by the appellant in the first stage of the trial ...   [11]     Some of the points raised by the appellant could not be considered by reason of the principles applicable to the calculations used in determining net worth, which is essentially a comparison of a situation existing on two given dates. ...

All these facts have the effect of nullifying the Notice of Appeal for that taxation year. [6]      I shall deal with only the 1998 and 1999 taxation years, for which the Notice of Appeal respects the time periods and the relevant procedure. [7]      The tax credit claimed by means of the Notice of Appeal is provided for in sections 118.3(1)(a) and 118.4(1)(c) of the Income Tax Act ("the Act "), which read as follows: 118.3 Credit for mental or physical impairment (1) Where (a) an individual has a severe and prolonged mental or physical impairment, (a.1) the effects of the impairment are such that the individual's ability to perform a basic activity of daily living is markedly restricted, (a.2) a medical doctor, or where the impairment is an impairment of sight, a medical doctor or an optometrist, has certified in prescribed form that the individual has a severe and prolonged mental or physical impairment the effects of which are such that the individual's ability to perform a basic activity of daily living is markedly restricted, (b) the individual has filed for a taxation year with the Minister the certificate described in paragraph (a.2), and (c) no amount in respect of remuneration for an attendant or care in a nursing home, in respect of the individual, is included in calculating a deduction under section 118.2 (otherwise than because of paragraph 118.2(2)(b.1) for the year by the individual or by any other person, for the purposes of computing the tax payable under this Part by the individual for the year, there may be deducted an amount determined by the formula A x $4,118 where A is the appropriate percentage for the year. 118.4 Nature of i mpairment (1) For the purposes of subsection 6(16), sections 118.2 and 118.3 and this subsection, (a) an impairment is prolonged where it has lasted, or can reasonably be expected to last, for a continuous period of at least 12 months; (b) an individual's ability to perform a basic activity of daily living is markedly restricted only where all or substantially all of the time, even with therapy and the use of appropriate devices and medication, the individual is blind or is unable (or requires an inordinate amount of time) to perform a basic activity of daily living; (c) a basic activity of daily living in relation to an individual means (i) perceiving, thinking and remembering, (ii) feeding and dressing oneself, (iii) speaking so as to be understood, in a quiet setting, by another person familiar with the individual, (iv) hearing so as to understand, in a quiet setting, another person familiar with the individual, (v) eliminating (bowel or bladder functions), or (vi) walking; and (d) for greater certainty, no other activity, including working, housekeeping or a social or recreational activity, shall be considered as a basic activity of daily living. [8]      The many judgments concerning the tax credit for mental or physical impairment have repeatedly noted that Parliament set out very restrictive and relatively precise tests for determining whether the tax credit is applicable. ... (e)         Finally there must be considered- and this is the most difficult principle to formulate- the criteria to be employed in forming the judgement whether the mental impairment is of such severity that the person is entitled to the credit, i. e. that that person's ability to perceive, think and remember is markedly restricted within the meaning of the Act. ...

  [3]      The point for determination is thus whether those amounts should have been included in Alta Mura's calculation, whether the same amounts should have been considered as appropriated by the appellant Mr. ... Doyon purportedly considered the cost too high. He requested another bid on the basis of new plans involving a structure made of steel rather than concrete. ...

I must therefore verify whether the facts relied on by the Minister in his determination were real and were correctly assessed and considered, having regard to the context in which they occurred. ... The cumulative effect of all of my above comments on these assumptions is that the Minister erred in several instances in stage one of the inquiry in that irrelevant factors were considered and some relevant factors were not. ...

  [9]      Taken together, these factors indicate that the employment terms that the Minister considered were quite different from the actual terms and conditions of employment for each of John and Robert Wierenga.  ... APPENDIX Assumptions of Fact   In deciding as he did, the Minister relied on the following assumptions of fact:   (a)      Bert Wierenga and Tena Wierenga each own 50% of the voting shares of the Appellant;   (b)     Bert Wierenga and Tena Wierenga are married to one another;   (c)     the Workers are the sons of Bert Wierenga and Tena Wierenga;   (d)     the Workers and the Appellant are related to each other within the within the meaning of the Income Tax Act, R.S.C. 1985 (5th Supp.) c. 1, as amended (the " Act ");   (e)      the Appellant operates a welding shop;   (f)      the business of the Appellant includes:   (i)      manufacturing and installing gates, panelling, squeezers and handlers for farmers in the elk industry; (ii)      manufacturing and installing dozer blades, bitch forks and other products for farmers; and (iii)     prefabricating and installing conveyor belts and other products for sawmills;   (g)     the Appellant has been operating for about 17 years;   (h)     the Appellant's business is located in Neerlandia, Alberta;   (i)      the Appellant's business generally operates from 8:00 a.m. to 5:00 p.m., Monday to Friday;   (j)      Bert Wierenga is generally available to supervise the business;   (k)     Bert Wierenga, Tena Wierenga and the Workers are all involved in the decision making of the Appellant;   (l)      during the period in issue, the Appellant employed between 6 to 7 employees, including the Workers;   (m)    2 of the employees work in the front of the shop and look after repairs and do sawmill work;   (n)     John Wierenga works in the back with the other employees doing work related to the elk industry;   (o)     Robert Wierenga performs most of the office duties, including bookkeeping, ordering parts and supplies, answering the telephone and other minor office duties;   (p)     Robert Wierenga also cleans shop and fixes equipment on some weekends or on days off;   (q)     Robert Wierenga's authority in the business is increasing as Bert Wierenga and Tena Wierenga decrease their involvement in the business;   (r)      Robert Wierenga started working for the Appellant in April, 2000;   (s)      Robert Wierenga convinced his parents to install a computer for the business of the Appellant;   (t)      initially, Robert Wierenga worked part-time to get the computer system working;   (u)     the job of bookkeeping became Robert Wierenga's as his mother, Tena Wierenga, could not do the bookkeeping on the computer;   (v)     although Robert Wierenga taught himself how to do the bookkeeping on the computer, he Appellant also paid him to take a computer course;   (w)     Robert Wierenga works without supervision for he most part since he is the only one that knows how to do the work that he does;   (x)     Robert Wierenga has signing authority on the business bank account of the Appellant and he signs the payroll cheques;   (y)     Robert Wierenga was paid $9.00 per hour when he started working for the Appellant, but he is currently being paid $12.00 per hour;   (z)      Robert Wierenga is expected to be at work from 9:00 a.m. to 5:00 p.m., Monday to Friday;   (aa)    Robert Wierenga also works on some Saturdays for a couple of hours, if necessary;   (bb)   Robert Wierenga currently works about 30 to 40 hours per week;   (cc)    if Robert Wierenga was not available to perform his duties, his work would not get done;   (dd)   if Robert Wierenga was away for a long period of time, the Appellant would have to train someone else to perform his duties;   (ee)    Robert Wierenga only has one leg;   (ff)     although Robert Wierenga uses crutches to get around, he is able to drive without difficulty;   (gg)    Robert Wierenga is limited in his ability in that the cannot perform hard physical labour;   (hh)    as both Robert Wierenga and the Appellant needed a truck, they each paid 1/2 of the cost of a truck that was used by both of them;   (ii)      John Wierenga's duties include:   (i)      being responsible for supervising, quality control and welding in the shop. and   (ii)      working in the office performing such tasks as material ordering, sales, preparing quotes and helping out where needed;   (jj)      John Wierenga started working for the Appellant when he was 11 1/2 years sold, making $5.00 per hour;   (kk)    John Wierenga is a journeyman welder;   (ll)      John Wierenga is currently being paid $18.00 per hour;   (mm)  John Wierenga is expected to be at work during regular shop hours, Monday to Friday, since he supervises the shop;   (nn)    John Wierenga is on call on his days off;   (oo)   John Wierenga usually works about 40 hours per week;   (pp)   as part of his duties, John Wierenga also attends elk conventions on behalf of the Appellant since his duties include selling products to the elk industry;   (qq)   John Wierenga has a lot of influence over the direction and operation of the business;   (rr)     while his parents were in Holland, John Wierenga had wanted to purchase pipe costing $28,000.00;   (ss)    John Wierenga discussed the decision to purchase the pipe with his father and brother;   (tt)     to finance the purchase of the pipe, John Wierenga invested $6,000.00 of his own money, in changes for 25% of the profit that was generated as a result of the acquisition of the pipe;   (uu)    the transaction involving the purchase of pipe was a one time occurrence;   (vv)    John Wierenga took out a personal loan to purchase a truck used in the business of the Appellant;   (ww)  it is the intention of the Appellant that John Wierenga be paid back in respect of the purchase of the truck;   (xx)    the Workers both decided on the type of advertising to be used for the business;   (yy)    in addition to their regular duties, the Workers also travelled to Edmonton to pick up parts for the business of the Appellant;   (zz)    the hours worked by the employees, including the Workers, were recorded;   (aaa) the rate of pay received by the employees, including the Workers was set by the Appellant;   (bbb) all of the employees of the Appellant, including the Workers, were paid by the hour;   (ccc)  the other employees of the Appellant were paid around $8.00 to $9.00 per hour to start, depending on their duties and whether they required any training;   (ddd) the employees of the Appellant, including the Workers, receive and advance on the 15th of each month, with the balance of their wages being paid at the end of the month;   (eee)  the Workers were always paid on time;   (fff)    the highest paid employee was Charlie De Boer, who was paid $21.00 per hour;   (ggg)  all of the employees, including the Workers, were entitled to wage increases as their duration of employment increased;   (hhh)  all of the employees, including the Workers, were paid vacation pay at increasing rates based on their length of employment;   (iii)     Robert Wierenga is paid vacation pay of 4% and is entitled to 2 weeks vacation;   (jjj)     John Wierenga is paid vacation pay of 8% and is entitled to 4 weeks vacation;   (kkk)  all of the employees of the Appellant, including the Workers, were paid overtime;   (lll)     all of the employees, including the Workers, receive a Christmas bonus;   (mmm)both Workers are not paid if they are sick and unable to work;   (nnn)  both Workers receive little supervision;   (ooo)           both Workers and the Appellant consider the wages paid to the Workers to be reasonable;   (ppp) although all of the employees of the Appellant could take time off, both Workers were given more leniency in that they did not have to give the Appellant advanced notice;   (qqq) Robert Wierenga stated that an unrelated employee would:   (i)      work from 8:00 a.m. to 5:00 p.m.; (ii)      not be expected to work after hours; (iii)     not have signing authority; and (iv)     not have the same scope of authority or responsibility;   (rrr)    John Wierenga stated that an unrelated employee would:   (i)      not buy a truck for use by the Appellant; (ii)      not attend an elk convention; (iii)     not have the same scope of authority or responsibility; and (iv)     not be included in making major decisions;   (sss)  the Workers were each employed under a contract of service with the Appellant;   (ttt)    the Minister considered all of the relevant facts available to him, including the remuneration paid, the terms and conditions, the duration and the nature and importance of the work performed; and   (uuu)  the Minister was satisfied that it was reasonable to conclude that the Workers and the Appellant would have entered into a substantially similar contract of employment if they had been dealing with each other at arm's length.         ...

The statute been considered to be broad enough as a matter of strict construction to give the Minister this power: see Hoobanoff Logging Ltd. v. ... APPENDIX   Assumptions of Fact   In so deciding as he did, the Minister relied on the following assumptions of fact:   (a)      the Appellant is in the cabinet making business;   (b)     Carlo Virga (hereinafter "the Shareholder") was the major shareholder of the Appellant during the period under review (the Period);   (c)     the Worker is the son of the Shareholder;   (d)     the Worker and the Appellant are related to each other within the meaning of the Income Tax Act, R.S.C. 1985 (5th Supp.) c. 1, as amended (the "Act");   (e)      the Worker [Dario Virga] was hired as a cabinet maker and did his apprenticeship with the Appellant;   (f)      the Worker has worked for the Appellant for over 7 years;   (g)     the Worker also installed cabinets and did not estimating;   (h)     the Worker earned a set hourly wage;   (i)      the Worker earned $10.00 per hour;   (j)      the Worker was paid bi-weekly by cheque;   (k)     the Worker also received a yearly bonus;   (l)      arm's length employees of the Appellant were paid by the hour and received yearly bonuses;   (m)    the Worker's wage was comparable with the Appellant's arm's length employees;   (n)     the Appellant issued the following T4 amounts to the Worker:   2001  $22,535 2000  $21,804 1999  $21,794 1998  $16,903 1997  $16,086   (o)     deduction for Canada Pension Plan contributions, employment insurance premiums and Income Tax were withheld from the Worker's wages;   (p)     the Worker normally worked during the Appellant's business hours;   (q)     the Worker normally worked 40 hours per week and some occasional overtime;   (r)      the Worker kept track of his hours and completed timesheets;   (s)      the Appellant had the right to control and supervise the Worker;   (t)      the Shareholder made all of the major decisions;   (u)     the Shareholder assigned work to the Worker;   (v)     the Worker notified the Appellant of any leave required;   (w)     the Shareholder normally did the estimating and any estimates completed by the Worker were reviewed by the Shareholder;   (x)     the Appellant provided all of the tools and equipment required including saws, staple guns, woodworking equipment and the work location;   (y)     the Worker did not have financial investment in the Appellant during the Period;   (z)      the Appellant reimbursed the Worker for fuel expenses incurred while travelling to do estimates;   (aa)    the Shareholder stated that an arm's length worker would not have any authority, would require instruction and would not do estimating;   (bb)   the Minister considered all of the relevant facts that were made available to the Minister, including the remuneration paid, the terms and conditions, the duration and the nature and importance of the work performed, and   (cc)    the Minister was satisfied that it was reasonable to conclude that the Worker and the Appellant would have entered into a substantially similar contract of employment if they had been dealing with each other at arm's length.         ...

          (1) For the purposes of subsection 6(16), sections 118.2 and 118.3 and this subsection, (a) an impairment is prolonged where it has lasted, or can reasonably be expected to last, for a continuous period of at least 12 months; (b) an individual's ability to perform a basic activity of daily living is markedly restricted only where all or substantially all of the time, even with therapy and the use of appropriate devices and medication, the individual is blind or is unable (or requires an inordinate amount of time) to perform a basic activity of daily living; (c) a basic activity of daily living in relation to an individual means     (i) perceiving, thinking and remembering,      (ii) feeding oneself or dressing oneself,     (iii) speaking so as to be understood, in a quiet setting, by another person familiar with the individual, (iv) hearing so as to understand, in a quiet setting, another person familiar with the individual, (v) eliminating (bowel or bladder functions), or, (vi) walking; (d) for greater certainty, no other activity, including working, housekeeping or a social or recreational activity, shall be considered as a basic activity of daily living. [20]     At this time, it is the markedly restricted ability to think, perceive and remember that is at issue. ... (e)     Finally there must be considered- and this is the most difficult principle to formulate- the criteria to be employed in forming the judgement whether the mental impairment is of such severity that the person is entitled to the credit, i.e. that that person's ability to perceive, think and remember is markedly restricted within the meaning of the Act. ...

Bayside (supra), the Federal Court of Appeal laid out certain matters which should be considered by this Court when hearing these appeals. ... (m)       the Appellant's hours were determined by the tasks required to be completed; (Agreed)   (n)        the Appellant's hours were not recorded; (Agreed)   (o)        the Appellant was supervised by the Shareholder; (Agreed)   (p)        the Payor provided the tools and equipment required; (Agreed)   (q)        the Appellant did not have a chance of profit or risk of loss; (Agreed)   (r)        the Appellant has not assumed personal liability for the Payor; (Agreed)   (s)        the Appellant's employment was terminated when the Payor had no contracts; (Agreed)   (t)         due to confidentiality, the Payor would not have hired an unrelated person to perform services the Appellant performed; (Disagreed)   (u)        the Appellant provided services to the Payor prior to the 1999 year and she was not paid for these services; (Agreed)   (v)        the Payor and the Appellant did not deal with each other at arm's length;   (w)       the Minister considered all of the relevant facts that were available to him, including the remuneration paid, the terms and conditions, the duration, and the nature and importance of the work performed, and   (x)        the Minister was not satisfied that it was reasonable to conclude that the Payor and the Appellant would have entered into a substantially similar contract of employment if they had been dealing with each other at arm's length.   ...