Date: 20020604
Docket: A-53-01
Québec, Quebec, June 4, 2002
CORAM: LÉTOURNEAU J.A.
BETWEEN:
PAUL-AIMÉ JONCAS
Appellant
and
HER MAJESTY THE QUEEN
Respondent
JUDGMENT
The appeal is dismissed with costs.
Gilles Létourneau
J.A.
Certified true translation
S. Debbané, LLB
Date: 20020604
Docket: A-53-01
Neutral citation: 2002 FCA 234
CORAM: LÉTOURNEAU J.A.
BETWEEN:
PAUL-AIMÉ JONCAS
Appellant
and
HER MAJESTY THE QUEEN
Respondent
Hearing held at Québec, Quebec, on June 4, 2002.
Judgment delivered from the bench at Québec, Quebec, on June 4, 2002.
REASONS FOR JUDGMENT OF THE COURT BY: LÉTOURNEAU J.A.
Date: 20020604
Docket: A-53-01
Neutral citation: 2002 FCA 234
NADONJ.A.
BETWEEN:
PAUL-AIMÉ JONCAS
Appellant
and
HER MAJESTY THE QUEEN
Respondent
REASONS FOR JUDGMENT OF THE COURT
(Delivered from the bench at Québec, Quebec,
on June 4, 2002)
[1] The appellant is seeking to have the decision by Judge Dussault of the Tax Court of Canada, which was based on an assessment of the witnesses' credibility and relates to what is essentially a question of fact, set aside.
[2] In order to determine whether the Minister of National Revenue was justified in refusing to recognize a business investment loss that was claimed by the appellant when he disposed of shares in the capital stock of a business corporation, the judge had to ascertain whether the appellant was dealing at arm's length with Garage LBS, to which all of the shares that were held by the appellant in the capital stock of Trans Côte inc. were transferred: see subparagraph 39(1)(c)(ii) and section 251 of the Income Tax Act (Act). Paragraph 251(1)(b) of the Act states that "it is a question of fact whether persons not related to each other were at a particular time dealing with each other at arm's length."
[3] In a highly-detailed 50-page decision, Judge Dussault did a thorough analysis of the documentary and testimonial evidence. The judge observed, in the very words of the accountant involved in preparing the transaction, that Garage LBS had acquired all of the shares of the capital stock of Trans Côte for the nominal sum of $1 and found that:
(a) the appellant, a physician, was under pressure by the Corporation professionnelle des médecins du Québec to dispose of his shares in Trans Côte;
(b) the Corporation professionnelle des médecins du Québec was putting this pressure on him because it considered that the appellant might have been in a conflict of interest when, as a physician, he ordered that patients be transferred to other institutions or, as a physician involved in the transport committee, he validated the transport of patients when the air transport of patients was provided by Trans Côte, which he owned;
(c) the appellant decided to dispose of the shares of the capital stock of Trans Côte to Garage LBS and his agents organized it to accommodate him temporarily in order to satisfy the Corporation professionnelle des médecins and reduce the pressure that it was putting on him;
(d) under the terms of that transaction, the appellant did not lose control in fact of Trans Côte;
(e) the decision by Garage LBS to purchase the shares of Trans Côte was in fact made by the appellant, who held 50 % of the shares of Garage LBS, of which he and Philippe Labadie were the directors;
(f) the shares of the capital stock of Trans Côte were transferred to a person with whom he was not dealing at arms length; and
(g) the loss claimed by the appellant resulted from a disposition that was artificial since it was to a person controlled by him at the time of the disposition.
[4] Those findings of fact made by the trial judge, who heard and saw the witnesses, and the inferences he drew from them, can be set aside only if they contain palpable and overriding errors or if they result from such errors: Housen v. Nikolaisen, [2002] S.C.C. 33, [2002] S.C.J. No. 31 (S.C.C).
[5] Despite the very able argument by counsel for the appellant, we were not satisfied that this was in fact the case.
[6] For these reasons, the appeal will be dismissed with costs.
Gilles Létourneau
J.A.
Certified true translation
S. Debbané, LLB
FEDERAL COURT OF APPEAL
Date: 20020604
Docket: A-53-01
Between:
PAUL-AIMÉ JONCAS
Appellant
and
HER MAJESTY THE QUEEN
Respondent
REASONS FOR JUDGMENT OF THE COURT
FEDERAL COURT OF APPEAL
NAMES OF COUNSEL AND SOLICITORS OF RECORD
COURT FILE NO.: A-53-01
STYLE OF CAUSE:
PAUL-AIMÉ JONCAS
Appellant
and
HER MAJESTY THE QUEEN
Respondent
PLACE OF HEARING: Québec, Quebec
DATE OF HEARING: June 4, 2002
REASONS FOR JUDGMENT
OF THE COURT BY: Létourneau J.A.
CONCURRED IN BY: Nadon J.A.
Pelletier J.A.
DATED: June 4, 2002
APPEARANCES:
René Roy for the appellant
Anne-Marie Boutin for the respondent
SOLICITORS OF RECORD:
FLYNN RIVARD
Québec, Quebec for the appellant
DEPARTMENT OF JUSTICE
Montréal, Quebec for the respondent