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He then considered the losses of that year as start-up costs and allowed the appeal. ... Justice Dickson lists, again at 314 [5215], a number of criteria which might be considered in the determination of a "reasonable expectation of profit”, such as ”... the profit and loss experience in past years, the taxpayer's training, the taxpayer's intended course of action, the capability of the venture as capitalized to show a profit after charging capital cost allowance.” ...

At all times material Christopher had not been considered a child under the provisions of the Divorce Act (Can.) and no maintenance provisions had been made for his benefit under either of the written separation agreements made between the appellant and her former spouse. ... The appellant had considered and had reported all of the payments received during 1980, 1981 and part of 1982 as maintenance income because it was all-inclusive and was made while she was entitled to support. ...

Taylor's initial position is that because a corporation does not exercise any control over a director, a director can not be considered an employee and therefore he falls outside the ambit of the Act. ... Paragraph 5 states that shares of the capital stock of a corporation which are subject to an escrow agreement and shares of the same class which are not so subject are considered to be identical properties. ...

If they were to earn income from the business, they provided some sort of an enduring benefit, much as the Hawaii convention did, were motivational in nature, and should not be considered a current expense. ... In this regard it is relevant to consider the depth of the information the taxpayer had regarding the topics to be considered when he decided to attend, the distance travelled, the time spent, and the amount of expenses incurred... ...

It should be noted that Rose had not considered this sector of the horse breeding business prior to or during the taxation years in question, and its relevance is questionable. ... The factors to be considered in determining the chief source of income were discussed by Dickson, J. at page 314 (D.T.C. 5215-16): Whether a source of income is a taxpayer's “chief source" of income is both a relative and objective test. ...

The liability of a taxpayer to pay tax under the Income Tax Act has been considered in a number of cases. ... Although this was a case involving a prosecution for tax evasion the Court considered the meaning to be attributed to the provisions of subsection 248(2) of the Act. ...

He contends that the farm operation was a business which was subordinate to or auxiliary to the appellants' full- time employment and that as a result it could not be considered a chief source of income. ... I have considered the criteria in Moldowan v. The Queen (supra) and have concluded for a number of reasons that in the taxation years 1978 to 1981 inclusive, farming was not the appellants' chief source of income. ...

In reaching her conclusion, the learned trial judge carefully considered the pertinent provisions of the Customs Act, the Excise Act, R.S.C. 1970, c. ... A second matter requiring definition, before the specific grounds of appeal are considered, is the status of a corporation being examined for discovery. ...

Justice Dickson lists, again at 314 [5215], a number of criteria which might be considered in the determination of a “reasonable expectation of profit”, such as ”... the profit and loss experience in past years, the taxpayer's intended course of action, the capability of the venture as capitalized to show a profit after charging capital cost allowance.” ... Top dollar on sales is $6,000 average and are considered successful in the $1,200-$2,000 range. ...

. — On December 26, 1983, the company acquired inventory equipment and goodwill in an arms-length transaction and these assets are considered by the company and Revenue Canada as replacement properties. — In early 1984, amended May 31, 1983 corporate tax returns were filed to reflect the elections being made under Section 44(1)(a) and 14(b) for the replacement properties acquired. — In early 1984, the corporate tax returns for the fiscal year ended December 31, 1983 were filed reflecting the acquisition of the replacement properties at values as outlined under sections 44 and 14. — Revenue Canada has assessed the calculation of the capital dividend account as defined by Section 89 of the Income Tax Act to be nil as follows. Capital dividend account as filed $ 181,278.00 Less— application of Subsection 44(5) $91,823 14(6) 89,455 181,278.00 Balance of Capital Dividend Account per Revenue Canada Taxa tion NIL — Revenue Canada has assessed Part III tax on the excessive election under Section 184(2) in the amount of A x 181,278 135,958.50 and charged interest of 24,312.35 $160,270.85 Reasons: — We disagree with Revenue Canada’s calculation of nil for the Capital Dividend account as Revenue Canada has taken events (the acquisition of the replacement properties) and elections (to have 44 and 14 apply to the replacement properties) to retroactively apply as reductions to the capital dividend account as calculated at December 2, 1983. — Section 89(1)(b) clearly defines the calculation of the Capital Dividend account of a corporation at any particular time to mean (1) /2 of the amount by which... the capital gains for the period commencing on the first day of the year commencing after the time the corporation last became a private corporation ending after 1971 and ending immediately before the particular time exceeds the capital losses for that same period (i.e. the particular time) plus paragraph (iii) that contains similar wording to include the appropriate portion of the eligible capital amounts. — We believe the particular time to be December 22, 1983, the date on which the election was made and only events up to the end of that particular time period should be considered in the calculations. — Sections 44, 14, and 89 concerning the replacement property rules do not contain any clauses that inter-relate the calculations. — On December 2, 1983, the company had not even acquired the replacement property so could not elect to have 44 and 14 apply to reduce the June, 1982 capital gains and income inclusions. — There are also numerous other sections of the Income Tax Act that allow capital transactions of one year to effect previous years yet not affect the current calculation of the capital dividend; for example: — December 1983 taxation year capital gain $50,000 January 1984 — Capital Dividend Account Election allowable 50,000 November 1984 Capital Loss 60,000 This entire November 1984 Capital Loss can be carried back to 1983 to recover income tax paid and reduce taxable income yet will have no affect on the valid January 1984 capital dividend account election. — We believe that the capital dividend account was properly calculated on December 22, 1983 and a valid election was filed on the payment of the dividend, thus the assessment should be reversed. — If for any particular reason the above appeal is not successful, the shareholders of the corporation and the corporation hereby elect under Section 184(3) to treat the excess as a separate taxable dividend. ...