Date: 19991208
Docket: 98-1097-IT-I; 1999-2280-IT-I
BETWEEN:
ROGER ROBIDOUX,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
Reasons for judgment
(Delivered orally from the bench on September 15, 1999, at Montréal, Quebec, and amended at Ottawa, Ontario, on December 8, 1999)
Lamarre, J.T.C.C.
[1] These are appeals brought under the informal procedure from assessments made by the Minister of National Revenue (“the Minister”) for the 1996 and 1997 taxation years. Through the assessments, the Minister disallowed $8,979 and $4,417 in legal expenses deducted by the appellant in computing his income for 1996 and 1997 respectively. In making the assessments, the Minister relied on the following facts:
[TRANSLATION]
(a) on or about February 22, 1996, the appellant filed a motion to vary corollary relief in order to have quashed a claim for arrears of support made by the collector of support on behalf of the appellant's former spouse, Nicole Hamel, and to oppose the possible garnishment of his wages; (admitted)
(b) in his tax returns for [the 1996 and 1997 taxation years], the appellant claimed, as legal expenses, fees totalling [$8,979 and $4,417 respectively] that he paid for the following reasons:
(i) cancellation of arrears;
(ii) cancellation of garnishment of wages;
(iii) claim for overpayment of support;
(admitted)
(c) it is the Minister’s opinion that the said legal expenses are not deductible by the payer thereof.
[2] The appellant argued that he also incurred these legal expenses in order to claim from his former spouse arrears of support that she owed him pursuant to an initial separation agreement entered into when a dependent child was living with him.
[3] According to a separation agreement signed on October 14, 1988 (Exhibit A-1) and ratified by a divorce judgment rendered by Mr. Justice Jacques Dugas of the Superior Court of Quebec on November 18, 1993 (Exhibit A-2), only the appellant had to pay child support. The agreement also provided that [TRANSLATION] “if the father and the mother each look after one child, the father shall pay only tuition fees” (article 3(B), Exhibit A-2).
[4] The appellant argued that, after receiving a support collection notice on February 19, 1996, through which his former spouse claimed arrears of support from him, he took legal steps both to counter the threats to garnish his wages and to claim support from his former spouse for the period during which he had had one child with him.
[5] A re-amended motion to vary collateral relief (Exhibit I-1) was filed by the appellant with the Superior Court of Quebec on November 26, 1996. In this motion, the appellant asked the Superior Court to reduce the child support payable under the divorce agreement, to cancel all the arrears claimed by his former spouse and to order his former spouse to give him back any overpayment he had made in respect of tuition fees and amounts he had paid her when the only remaining dependent child was living with him.
[6] By a consent signed on April 10, 1997 (Exhibit A-7) the appellant’s former spouse waived all the arrears of support and tuition fees claimed by the collector of support. The agreement also provided that no arrears or overpayment amounts would be paid to the appellant and that he was waiving any claim in that regard. Articles 7, 8 and 9 of the consent also state the following:
[TRANSLATION]
7. The defendant [the former spouse] acknowledges having received $280.00 a month from the plaintiff [the appellant] since May 1996 even though Roger was no longer a dependent child, and she undertakes to pay the plaintiff $100.00 in nominal arrears, the said sum to be payable within 60 days of the judgment to be rendered and to constitute full and final settlement;
8. The parties declare that, since the three children are self-sufficient and are no longer children of the marriage within the meaning of the Divorce Act, no further support or tuition fees shall be payable by the plaintiff to the defendant for their benefit, and vice versa;
9. Any support provided for in a previous judgment is therefore cancelled.
[7] The appellant argued that he accepted the nominal amount of $100 from his former spouse in payment, inter alia, of the support that she owed him for when the only dependent child was living with him. In support of his arguments, he relied on a schedule attached to the consent of April 10, 1997. That schedule summarizes his claim for amounts he allegedly overpaid his former spouse. In the schedule, the appellant claimed from his former spouse overpayments of tuition fees and support and an amount for the support that she had allegedly not paid him for the child who had lived with him temporarily.
[8] The appellant argued that the schedule attached to the consent of April 10, 1997, proves that his former spouse had to pay him support pursuant to the divorce agreement.
[9] I cannot accept that argument. First of all, the schedule referred to by the appellant merely provides a breakdown of his claim for amounts he felt he had overpaid. The schedule, which is not signed by the appellant or his former spouse, is not as such part of the consent of April 10, 1997. Moreover, the preamble to the consent makes no reference to the existence of a previous agreement requiring the appellant’s former spouse to pay him support if he had custody—temporary or otherwise—of a child. Nor does the divorce agreement ratified by Mr. Justice Dugas (Exhibit A-2) say that the appellant’s former spouse had to pay him such support.
[10] It is my view that the appellant has not shown on a balance of probabilities that he incurred legal expenses to collect arrears of support to which he was entitled. The evidence instead shows that he was not entitled to any support.
[11] The legal expenses were actually incurred by the appellant to defend against the garnishment of his wages and to try to claim from his former spouse amounts he felt he had overpaid her for tuition fees and support. Such expenses are not incurred for the purpose of producing income but are rather personal or living expenses. The legal expenses in question are therefore not deductible from the appellant’s income under the Act.
[12] The appeals are dismissed.
Signed at Ottawa, Canada, this 8th day of December 1999.
“Lucie Lamarre”
J.T.C.C.
[OFFICIAL ENGLISH TRANSLATION]
Translation certified true on this 21st day of January 2000.
Erich Klein, Revisor