Words and Phrases - "sham"
Chad v. The Queen, 2022 TCC 18
Before denying a motion of the Crown to add an allegation of “window dressing” in its pleadings, Sommerfeldt J stated (footnote 39).
It is my understanding that the ordinary dictionary meaning of the term is “an adroit presentation of facts etc. to give a deceptively favourable impression” (Katherine Barber (editor), Canadian Oxford Dictionary, 2nd ed. (Don Mills: Oxford University Press, 2004), p. 1783); or “[t]he deceptive arrangement of something, usu. facts or appearances, to make it appear more attractive or favorable” (Bryan A. Garner (editor), Black’s Law Dictionary, 10th ed. (St. Paul: Thomson Reuters, 2014), p. 1835). Based on those dictionary meanings, it appears that, while a sham involves deceitfully misrepresenting the nature of a transaction, window dressing would seem to entail deceptively making facts appear better or more favourable than they actually are.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Other Legislation/Constitution - Federal - Tax Court of Canada Rules (General Procedure) - Section 54 | the Crown could not resile from an oral representation that it would not argue “tax shelter” at trial | 506 |
28 October 2010 Internal T.I. 2010-0376041I7 F - Contrat d'acquisition ou de location
Motor vehicle lease agreements between a company and a leasing company provide that the company will automatically acquire ownership of the leased vehicles after making specified rent payment, and with the payment of the residual value, which might be as low as $0.01. If the company decides not to acquire, a credit is applied to its account where the proceeds of the sale of the car by the leasing company exceed the residual value. Before indicating that the contract required further study to determine its nature, CRA stated:
[S]ubject to the application of the general anti-avoidance rule and in the absence of sham, a re-characterization of legal relationships is only possible where a taxpayer's designation of the transaction does not adequately reflect its true legal effects or where there is an express provision in the Act that the legal relationships are not to be respected.
The term "sham" generally refers to a transaction with an element of deception so as to create an illusion intended to conceal the actual nature of the transaction or a pretence whereby the taxpayer creates an appearance that is different from the reality it serves to conceal.
[W]hether a contract is a purchase contract or a lease contract should be resolved primarily on the basis of the legal relationships created by the terms of the agreement.
The CRA summary stated:
In the present case, because of certain facts, we believe that it might be appropriate to go beyond the legal relationships established by the parties.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 6 - Subsection 6(2) - Element E | lease where lessee got benefits of ownership even if it didn’t acquire title needed study to determine its true nature | 171 |
| Tax Topics - Income Tax Act - Section 13 - Subsection 13(21) - Undepreciated Capital Cost - A | lease where lessee got benefits of ownership even if it didn’t acquire title not necessarily a lease | 135 |