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Page 14 June 25, 2018 • Law Times www.lawtimesnews.com cannot supplant Charter and domestic law. International law cannot effectively "read in" pro- vision into the Charter respect- ing the family. Three of five questions certified. Question whether s. 7 of Charter engaged where deprivation of right to liberty and security of person of permanent resident arises from their uprooting from Canada, and not from possible persecu- tion or torture in the country of nationality certified. Question whether criteria to depart from binding jurisprudence met in present case certified in keeping with principle of comity. Ques- tion relating to prematurity is- sues under s. 12 of Charter certi- fied as unclear whether distinc- tion between admissibility and deportation. Question relating to consequences of deportation as it relates to psychological, so- cial, and linguistic impacts too broad and did not transcend interests of parties. Question whether family is "association" under s. 2(d) of Charter, and de- portation could infringe right to associate with family too broad to be certified. Moretto v. Canada (Citi- zenship and Immigration) (2018), 2018 CarswellNat 133, 2018 CarswellNat 385, 2018 FC 71, 2018 CF 71, Ann Marie Mc- Donald J. (F.C.); application for judicial review refused (2016), 2016 CarswellNat 9865, 2016 CarswellNat 9866, George Pem- berton Member (Imm. & Ref. Bd. (App. Div.)). Pensions FEDERAL AND PROVINCIAL PENSION PLANS Federal pension plans Being markedly restricted or not fit to work were insufficient to ground finding of incapacity Applicant was victim of armed assault and was diagnosed with Post-Traumatic Stress Disorder (PTSD). Applicant was granted disability benefits under Can- ada Pension Plan retroactive to date five years after incident, two years before her application. Applicant sought additional benefits retroactive to date of incident on basis of incapacity. General Division–Income Se- curity Section concluded that applicant was not incapacitated despite her psychiatric condi- tion because she was capable of forming and expressing inten- tion to make application earlier than she did. Appeal Division of Social Security Tribunal dis- missed applicant's application for leave to appeal. Applicant brought application for judicial review. Application dismissed. Appeal Division's conclusion that appeal had no reasonable chance of success was reason- able. General Division was entitled to give weight to dec- laration of incapacity filed by family physician. General Di- vision could conclude that be- ing markedly restricted or not fit to work were insufficient to ground finding of incapacity. General Division's capacity de- termination had to be based on evidence and not on equitable considerations. Being disabled did not equate to being inca- pable to form or express inten- tion to make application. Lack of knowledge about entitlement to disability pension did not fall within scope of incapacity. O'Rourke v. Canada (At- torney General) (2018), 2018 CarswellNat 2451, 2018 Car- swellNat 2731, 2018 FC 498, 2018 CF 498, Luc Martineau J. (F.C.). Tax INCOME TAX Administration and enforcement Disclosure of redacted information would have concrete deleterious effect on public interest in completing audits Minister of National Revenue audited taxpayer's personal income tax returns. Taxpayer brought applications for judi- cial review to set aside require- ments to produce documents and information. Taxpayer requested all material relied on to issue requirements. Min- ister served redacted certified record signed by Canada Rev- enue Agency (CRA) auditor. Minister brought applications under s. 37 of Canada Evidence Act, ancillary to judicial review applications, for orders prohib- iting disclosure of redacted in- formation on ground of public interest privilege. Applications granted. Redacted informa- tion was not to be disclosed. Minister was not seeking to establish class privilege over all communications between CRA auditors and technical special- ists. Disclosure of redacted in- formation would have concrete deleterious effect on public interest in completing audits. Revealing CRA's internal tech- nical discussions and strategic discussion could endanger suc- cessful audit of taxpayer's file. Factors weighed dispropor- tionally in favour of upholding public interest in protection of information related to ongoing audits. Audit was ongoing ad- ministrative procedure that was not being done for improper purpose, redacted information could not affect outcome of ju- dicial review applications, dis- closure of redacted information could affect outcome of audit, would prejudice ongoing audit operations and would harm public's perception in adminis- tration of justice, and there had not been prior publication of information. Taxpayer's request was not fishing expedition, but this was only factor that fa- voured disclosure of redacted information. Canada (Attorney General) v. Chad (2018), 2018 Carswell- Nat 2657, 2018 FC 556, Simon Noël J. (F.C.). Tax Court of Canada Tax INCOME TAX Business and property income Company's life insurance premium deductions denied on basis loans were personal loans of principal shareholders Company took out first loan, life insurance policy was taken out as financing condition, and final payment on first loan was made in 2013. Second loan was taken out and another life insurance policy was acquired as lending condition. Loan was more in na- ture of credit facility that could be drawn down as required and there was outstanding balance on second loan as of 2012. Com- pany submitted deductions for life insurance expenses for taxa- tion years 2013 to 2015. Minister denied company's life insurance premium deductions on basis that loans were personal loans of principal shareholders. Compa- ny appealed. Appeal dismissed. There were several concerns pertaining to first loan, one of which was that it was indicated that balance outstanding was to be repaid in 2013 and company's year end took place after that re- payment date, which suggested that for 2014 and 2015 taxation years, balance owed to lender was nil. Difficulty with second loan was that shareholder in- dicated that credit facility was never fully drawn down, which suggested that company only borrowed what was required from time to time and that credit facility was paid back on rolling basis. There was also no evidence of any indebtedness for 2013 to 2015 taxation years – In this case, minimum evidence re- quirement was not met by com- pany. Emjo Holdings Ltd. v. The Queen (2018), 2018 Carswell- Nat 2452, 2018 TCC 97, Guy R. Smith J. (T.C.C. [Informal Pro- cedure]). Activities carried out in connection with airline venture not constituting source of income Taxpayer accountant was one of founders and sharehold- ers of company established to provide services as regional airline. Company retained pro- fessionals, including plaintiffs, to provide services for develop- ing airline business before de- claring bankruptcy. Plaintiffs' action against company led to judgment finding taxpayer and other defendants liable to pay damages. Taxpayer's appeal was dismissed. Taxpayer claimed de- duction for his payment of dam- ages to plaintiffs and of legal ex- penses for litigation. Minister re- assessed taxpayer under Income Tax Act on basis that that ex- penses were personal in nature. Taxpayer appealed. Appeal dis- missed. It was clear that taxpayer never had intention to carry out regional airline activities per- sonally or as member of group of investors and promoters and never did so. Activities carried out by taxpayer in connection with airline venture did not con- stitute source of income to him. Even if airline activities were to constitute source of income for taxpayer, it disappeared when company declared bankruptcy and its holding company was dissolved. In year in which tax- payer made payment, he had no source of income coming from airline's activities and was not carrying out any business other than his accounting one. There was no nexus between expenses claimed as deductions and busi- ness he was actually carrying on in that year. Expenses made when taxpayer was ordered to pay damages were not made for purpose of gaining or producing income as required by s. 18(1)(a) of Act. Nandlal v. The Queen (2017), 2017 CarswellNat 4239, 2017 CarswellNat 8946, 2017 TCC 162, 2017 CCI 162, Réal Fa- vreau J. (T.C.C. [Informal Proce- dure]). INCOME TAX Tax credits Transfers of property by taxpayers to charitable foundation were gifts Taxpayers participated in pro- gram, requiring investment, largely funded by unit loan, in limited partnership units (LP unit), and transfer of money to charitable foundation, largely funded by charitable foundation loan, to obtain charitable dona- tion tax credit and deductions in respect of program loans (unit loan and charitable foun- dation loan together). Minister of National Revenue reassessed taxpayers, denying charitable donation tax credit. Taxpay- ers appealed. Appeals allowed. Taxpayers' transfer of property to charitable foundation was not gratuitous, so transfer was not gift under common law. Tax- payers received benefit because of charitable foundation loans, which were not commercially reasonable debt instruments. Transfers of property by tax- payers to charitable foundation were gifts for purposes of s. 118.1 of Income Tax Act because of s. 248(30) of Act. Benefit asso- ciated with charitable founda- tion loans to taxpayers did not exceed 80 per cent threshold, so they were gifts for purposes of Act. Eligible amount of charita- ble gifts was nil. Arrangements to repay principal and interest owed under program loans were not bona fide arrangements as contemplated by s. 143.2(7) of Act. Principal amount of each program loans was limited-re- course amount for purposes of s. 143.2(6.1) of Act. Charitable foundation loans related to gifts since loans funded 98 per cent of gifts. Unit loans were not related to gifts. Eligible amount of gifts by taxpayers to charitable foun- dation was reduced by principal amount of their charitable foun- dation loans. Amount of advan- tage in respect of gifts made by taxpayers to charitable founda- tion was greater than amount of those gifts so eligible amount of gift made by each taxpayer to charitable foundation was nil. Cassan v. The Queen (2017), 2017 CarswellNat 4351, 2017 TCC 174, John R. Owen J. (T.C.C. [General Procedure]). Ontario Civil Cases Civil Practice and Procedure COSTS Costs of particular proceedings Estate's costs should be limited to actual partial indemnity costs it incurred Plaintiffs, two of four sharehold- ers in holding company that owned commercial property, brought action against defen- dants for their share of rental in- come. One defendant held back part of plaintiffs' entitlement because of claim to part of their funds by estate of former prop- erty manager. Defendants' mo- tion to add estate as necessary party to action was dismissed on basis that estate's claim was stat- ute barred. Appeal by estate was allowed and it was added as par- ty. Estate was awarded its costs of appeal. Parties made submis- sions on costs of motion below. Estate and defendants entitled to their costs of motion. Main focus of appeal and motion was whether estate was entitled to be added as party to underlying action, issue that it successfully appealed. Estate's costs should be limited to actual partial in- demnity costs it incurred. De- fendants were also entitled to their costs of motion on partial indemnity basis. Plaintiffs or- dered to pay estate and defen- dants their costs of motion, fixed in amount of $10,000 payable to estate and $8,000 payable to de- fendants, both amounts inclu- sive of disbursements and HST. Abrahamovitz v. Berens (2018), 2018 CarswellOnt 8645, 2018 ONCA 512, John Laskin J.A., K. Feldman J.A., and B.W. Miller J.A. (Ont. C.A.); addi- tional reasons (2018), 2018 Car- swellOnt 3820, 2018 ONCA 252, John Laskin J.A., K. Feldman J.A., and B.W. Miller J.A. (Ont. C.A.). COSTS Particular orders as to costs Unfair to punish respondents in costs without affording them opportunity to fully respond to allegations Applicants, deceased farm owner's common law spouse K and corporations, claimed property interests in farm, ani- mals, farm equipment, and farm vehicles based on ownership, CASELAW

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