Date: 19980501
Docket: A-285-97
MONTRÉAL, QUEBEC, THE 1st DAY OF MAY 1998
CORAM: THE HONOURABLE MR. JUSTICE DENAULT
THE HONOURABLE MR. JUSTICE DÉCARY
THE HONOURABLE MR. JUSTICE LÉTOURNEAU
BETWEEN:
J. ADORY LALIBERTÉ,
GEORGETTE OTIS LALIBERTÉ
Applicants
AND:
HER MAJESTY THE QUEEN
Respondent
J U D G M E N T
The application for judicial review is dismissed.
Pierre Denault
J.A.
Certified true translation
Peter Douglas
Date: 19980501
Docket: A-285-97
CORAM: DENAULT J.A.
DÉCARY J.A.
LÉTOURNEAU J.A.
BETWEEN:
J. ADORY LALIBERTÉ,
GEORGETTE OTIS LALIBERTÉ
Applicants
AND:
HER MAJESTY THE QUEEN
Respondent
Hearing held at Montréal, Quebec on Friday, May 1, 1998
Judgment delivered from the bench at Montréal, Quebec on Friday, May 1, 1998
REASONS FOR JUDGMENT OF THE COURT BY: LÉTOURNEAU J.A.
Date: 19980501
Dossier: A-285-97
CORAM: DENAULT J.A.
DÉCARY J.A.
LÉTOURNEAU J.A.
BETWEEN:
J. ADORY LALIBERTÉ,
GEORGETTE OTIS LALIBERTÉ
Applicants
AND:
HER MAJESTY THE QUEEN
Respondent
REASONS FOR JUDGMENT OF THE COURT
(Delivered from the bench at Montréal, Quebec
on Friday, May 1, 1998)
LÉTOURNEAU J.A.
[1] This is an application for judicial review by two applicants to quash a decision of Judge Tardif of the Tax Court of Canada. Ultimately, the only issue before us was whether Mrs. Laliberté (the applicant) was entitled to deduct, in respect of 1990, 1991 and 1992, the interest paid on a mortgage loan she took out in 1988 when a rental property belonging to her husband, on which she had a second mortgage, was repossessed.
[2] The applicant used $20,000 of the amount so borrowed to repay the first mortgage creditor. However, the $20,000 loaned by the first mortgage creditor to the applicant"s husband in 1986 had been borrowed not to produce income, but to pay legal costs in connection with a civil suit unrelated to the rental property. At the time, the applicant had guaranteed her husband"s loan and stood joint and several surety for the borrower in relation to the lender. Thus, in 1988, when the applicant repaid the $20,000 owed to the first mortgage creditor, she released herself from her obligation as guarantor, so the amount was used for personal purposes, not to produce income.
[3] We are all of the view that the interest deduction claim was rightly refused.
[4] The financial difficulties experienced by the applicants are unfortunate and it is impossible not to sympathize with them. However, the applicable statutory provisions in the case at bar and their interpretation by the courts leave us, like the Judge of the Tax Court of Canada, with no alternative but to dismiss the applicant"s claim. The application for judicial review will be dismissed.
Gilles Létourneau
J.A.
Certified true translation
Peter Douglas
FEDERAL COURT OF CANADA
APPEAL DIVISION
NAMES OF COUNSEL AND SOLICITORS OF RECORD
COURT NO.: A-285-97
STYLE OF CAUSE: J. ADORY LALIBERTÉ ET AL. v. THE QUEEN
PLACE OF HEARING: Montréal
DATE OF HEARING: May 1, 1998
REASONS FOR JUDGMENT
OF THE COURT BY: Létourneau J.A.
DATED: May 1, 1998
APPEARANCES:
J. Adory Laliberté
Georgette Otis Laliberté FOR THE APPLICANTS
Marie-Andrée Legault FOR THE RESPONDENT
SOLICITORS OF RECORD:
J. Adory Laliberté FOR THE APPLICANTS
George Thomson
Deputy Attorney General of Canada
Ottawa, Ontario FOR THE RESPONDENT