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., supra, the Federal Court of Appeal laid out certain matters which should be considered by this Court when hearing these appeals. ... That decision was as follows:- “Your work in Canada, with 150307 Canada Limited for the period under review cannot be considered as insurable employment as you were not an employee performing services under a contract of service.” [18] This was followed in the letter with various reasons for the decision and a comment that the books of the Company were not available as Donald Knight was not available to be interviewed and thus they could not verify whether or not she was employed under a contract of service. [19] The decision appears to be somewhat based upon an internal memo, produced to the Appellant pursuant to the Privacy Act and filed with the Court as Exhibit A-1. The conclusion in this memo was that: “...a contract of service was considered not to be in existence as detailed above and that the objective of the case was to qualify the worker for U.I. ...

Accounting statements for partnerships and income tax information are sent to the limited partners, reports of distributors are reviewed to verify all revenues owing to the partnerships were remitted by the distributors; legal action against distributors is considered. ... Since the appellant reported no sales or revenues during the period, one may reasonably infer that the appellant was not engaged in commercial activities during the period and, if so, the appellant cannot be considered eligible for ITCs in the period. [9] [37] In accordance with subsection 169(1) of the Act, ITCs are available where tax on inputs in respect of a supply becomes payable or is paid by a registrant person. ... Although the Minister is empowered to register any person applying for registration,c it is arguable that in circumstances where a registrant was not engaged in commercial activity at the time of registration, the registration should be considered a nullity and does not bind the Minister.d             It may well be that subsection 241(1) should be interpreted restrictively because subsection 240(3) would be meaningless and unnecessary if the Minister’s authority under subsection 241(1) to register any applicant were broad enough to include any applicant without condition. ...

The facts upon which the Minister of National Revenue (the "Minister"), relied in making his decision under appeal are described at paragraph 4 of the Reply to the Notice of Appeal ("Reply No. 1"), as follows: (a) the payor operates a management business; (b) the Appellant is the Payor's son; (c) in 1993, the Payor bought a house at 484 Sunnyside in Ottawa, which he decided to convert in small apartments to rent to Carleton University students; (d) the Payor hired his two sons who are Dali Bentolila and Appellant and as well hired his son's two friends, Kimberly Lutz and David Colpitts, to renovate the house mentioned in paragraph (c); (e) the reason indicated by the Payor to hire the particular four individuals mentioned in paragraph (d) was to qualify them to collect unemployment insurance benefits since they were students and they needed the money; (f) in 1995, the Payor did not hire any other workers apart from the four persons mentioned in paragraph (d); (g) the renovations of the building started in 1994 and as of 1996, the renovations were still not finished; (h) the Appellant was reportedly hired as Project Engineer; (i) the Appellant was hired for only 22 insurable weeks, which is close to the minimum number of weeks he required to qualify for unemployment insurance benefits; (j) the Appellant was reportedly paid $3,334.00 per month; (k) the Appellant was purportedly paid in cash for the first month of his employment but no proof of payment could be provided; (l) for the year 1995, the Payor reported gross professional income of $56,054.30, salary expense of $58,082.41 and a net loss of $15,446.56; (m) the Payor deducted Canada pension contributions and unemployment insurance premiums from the Appellant's remuneration yet the Payor did not deduct any taxes from the Appellant's remuneration as required; (n) in 1994, the Appellant performed the same type of service for the Payor under the same conditions, but was considered as a self-employed person by the Payor; (o) in 1994, the Appellant reported his income from the Payor as self-employed income on his income tax return: Gross Income $29,613.00 Net Income $ 7,158.00 (p) the Appellant has not filed his income tax return for the year 1995, therefore his method of reporting the income could not be verified for that particular year; (q) the engagement of the Appellant by the Payor during the relevant period allowed the Appellant to qualify for unemployment insurance benefits, rather than being based on any business consideration or need; (r) the Appellant is related to the Payor within the meaning of the Income Tax Act; (s) having regard to all the circumstances of the employment, including the remuneration paid, the terms and conditions, the duration and the nature and importance of the work performed, it is not reasonable to conclude that the Appellant and the Payor would have entered into a substantially similar contract of employment if they had been dealing with each other at arm's length. [4] For the Appellant Kimberly Lutz, the period at issue is April 1 to July 31, 1995. ... In situations dealing with individuals, it is the second test that would be considered. [27] These tests are have been thoroughly analysed by Bonner, J., in McNichol et al v. ... The acting in concert test is considered to be an expansion of the common mind test or the directing mind test being applied to natural persons. ...

If the property was not maintained in connection with a business carried on for profit or with a reasonable expectation of profit then the Act, at subsection 248(1), provides that the expenses of that property are personal or living expenses; personal or living expenses are not deductible by a tax payable in computing income: paragraph 18(1)(h). [25]          In 1977 the Supreme Court of Canada [2] considered the question of what is required by a taxpayer to have a profit or reasonable expectation of profit from a venture so that the expenses of a property would not be categorized a personal or living expenses. ... The following criteria should be considered: 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. ... One would not expect a farmer who purchased a productive going operation to suffer the same start-up losses as the man who begins a tree farm on raw land. [27]          Recently the Federal Court of Appeal has considered anew in Tonn et al. v. ...

In instances where the driver's means of financial support is [sic] inextricably bound up with the respondent we are of the view that he cannot be considered an independent contractor. ... The most that can be said is that control will no doubt always have to be considered, although it can no longer be regarded as the sole determining factor; and that factors, which may be of importance, are such matters as whether the man performing the services provides his own equipment, whether he hires his own helpers, what degree of financial risk be taken, what degree of responsibility for investment and management he has, and whether and how far he has an opportunity of profiting from sound management in the performance of his task. ... Furthermore, nothing was heard on behalf of the Respondent that could lead the Court not to accept the evidence of the Appellant and his witnesses. [30] I am thus satisfied that the Appellant has proven on a balance of probabilities the existence of a contract of service. [31] I do not consider this decision to be a precedent for any other past or future periods of employment of the Appellant or other workers with the Payor or anyone else, the Minister maintaining the right to investigate any other periods of employment of workers for unemployment insurance purposes. [32] This decision applies to the Appellant for the periods of employment under review only, because these are the only periods of work that may be considered by this Court. ...

Larry Beber Jr. testified that he had been employed by the Appellant for 12 years and that he considered Wentland to be the owner and boss of the Appellant during the period in question. ... In particular, an individual who controls more than 40% of the shares of the employer will not be considered to be engaged in insurable employment. ... Hence, the Court considered the percentage ownership of voting shares in relation to other shareholders, the ownership of corporate debts, shareholders' agreements, commercial contracts, the possession of unique expertise required by the corporation, and potential influence of family members on the operation of the business. [25] The existence of de facto control on the part of Wentland is a question of fact based on the evidence adduced at trial. ...

There is much jurisprudence in Canada, the United Kingdom and the United States in which the question whether provisions in a statute are directory or imperative has been considered. ... In others, such prescriptions have been considered as merely directory, the neglect of them involving nothing more than liability to a penalty, if any were imposed, for breach of the enactment. ... " 1 It is impossible to lay down any general rule for determining whether a provision is imperative or directory. 2 "No universal rule," said Lord Campbell L.C., "can be laid down for the construction of statutes, as to whether mandatory enactments shall be considered directory only or obligatory with an implied nullification for disobedience. ...

Stéphane Lalancette is the only person named as a director. [14] On July 22, 1992, the appellant assigned all of his shares to the company (Tab 56, Exhibit I-1). [15] On October 13, 1992, according to the minutes (Tab 48, Exhibit I-1), the appellant was considered to be the company’s president. ... The appellant therefore had to be considered a de facto director and to assume the responsibilities imposed on him by law. ... Analysis [18] In this case, the appellant was not listed as a director in the 1990 annual report ([5]: 6(c)) or the declaration made to the prothonotary on August 2, 1990 ([12]: Tab 61). [19] However, based on a review of the above evidence in the light of the case law and other authorities, the appellant must be considered a de facto director, whether or not he is a shareholder or de jure director. ...

The Minister considered that the Appellant had received unreasonable increases of 9% in 1995 and 14% in 1996. ... The Minister obviously considered that it was not reasonable to retain the worker during the periods in issue because the landscaping part of the business was not profitable. [35] It was not reasonable for the Minister to so conclude. The Minister should have taken the whole operation into account, not just part of it. [36] In paragraph (n), the Minister considered, unfavorably to the Appellant, that the payor included income that he received when overseas. ...

Even if the Minister acted in an arbitrary manner during the audit, the facts assumed are generally considered to be true unless the taxpayer provides satisfactory evidence to the contrary in Court ... Sugnanam’s rental property’s expenses for year 2003 were not considered.   ... SECTION 15(1)     Benefit conferred on shareholder        (1)  Where at any time in a taxation year a benefit is conferred on a shareholder, or on a person in contemplation of the person becoming a shareholder, by a corporation otherwise than by   (a) the reduction of the paid-up capital, the redemption, cancellation or acquisition by the corporation of shares of its capital stock or on the winding-up, discontinuance or reorganization of its business, or otherwise by way of a transaction to which section 88 applies,   (b) the payment of a dividend or a stock dividend,   (c) conferring, on all owners of common shares of the capital stock of the corporation at that time, a right in respect of each common share, that is identical to every other right conferred at that time in respect of each other such share, to acquire additional shares of the capital stock of the corporation, and, for the purpose of this paragraph,   (i) where   (A) the voting rights attached to a particular class of common shares of the capital stock of a corporation differ from the voting rights attached to another class of common shares of the capital stock of the corporation, and   (B) there are no other differences between the terms and conditions of the classes of shares that could cause the fair market value of a share of the particular class to differ materially from the fair market value of a share of the other class,   the shares of the particular class shall be deemed to be property that is identical to the shares of the other class, and   (ii) rights are not considered identical if the cost of acquiring the rights differs, or   (d) an action described in paragraph 84(1)(c.1), 84(1)(c.2) or 84(1) (c. 3), the amount or value thereof shall, except to the extent that it is deemed by section 84 to be a dividend, be included in computing the income of the shareholder for the year.   ...