[OFFICIAL ENGLISH TRANSLATION]
2001-51(IT)I
BETWEEN:
MARJOLAINE DIONNE,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
Appeal heard on November 26, 2001, at Québec, Quebec, by
the Honourable Judge Louise Lamarre Proulx
Appearances
For the Appellant: The Appellant herself
Counsel for the Respondent: Dany Leduc
JUDGMENT
The appeal from the determination of the child tax benefit dated July 20, 2000, in respect of Josia, the appellant's daughter, for the 1999 base year is dismissed in accordance with the attached Reasons for Judgment.
Signed at Ottawa, Canada, this 6th day of December 2001.
|
"Louise Lamarre Proulx" |
J.T.C.C.
[OFFICIAL ENGLISH TRANSLATION]
Date: 20011206
Docket: 2001-51(IT)I
BETWEEN:
MARJOLAINE DIONNE,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR JUDGMENT
Lamarre Proulx, J.T.C.C.
[1] This is an appeal under the informal procedure concerning the calculation of the child tax benefit for the 1999 base year. The point at issue was whether the net income of the appellant's de facto spouse must be considered in computing the adjusted income within the meaning of that term in section 122.6 of the Income Tax Act (the "Act").
[2] By notice of child tax benefit dated July 20, 2000, the Minister of National Revenue (the "Minister") determined that the amount of the tax benefit to which the appellant was entitled for her daughter Josia for the 1999 base year was $32.33.
[3] In determining that tax benefit, the Minister relied on the facts described in paragraph 5 of the Reply to the Notice of Appeal (the "Reply") as follows:
[TRANSLATION]
(a) the appellant is the mother of a daughter named Josia, whose date of birth is March 1, 1984;
(b) the appellant and Guy Morrissette have lived together at least since September 1998;
(c) in her notice of objection dated September 11, 2000, the appellant stated that she had a de facto spouse at the end of December 1999;
(d) the net income of the appellant's de facto spouse, Guy Morrissette, totalled $62,328 for the 1999 taxation year;
(e) the net family income for the 1999 taxation year totalled $72,871;
(f) after the net family income was considered in computing the appellant's child tax benefits for the 1999 base year, the Minister determined that the tax benefit for the appellant's daughter Josia was an annual sum of $32.33;
[4] The appellant testified. She corrected her daughter's date of birth referred to in subparagraph 5(a) of the Reply to March 30, 1984. She admitted subparagraph 5(b). She also admitted subparagraph 5(c), provided the sentence ended after [TRANSLATION] "stated that she had a de facto spouse". She had not used the words [TRANSLATION] "at the end of December 1999" in her notice of objection. However, she testified that Guy Morrissette and she were de facto spouses during 1999 and are still so now.
[5] She denied subparagraph 5(d) because she believed that Mr. Morrissette's income was greater than the amount cited. She also denied subparagraph 5(e) because she did not think the net family income was $72,871. She denied subparagraph 5(f).
[6] The appellant explained that, in 1998, before Mr. Morrissette came to share her life, she had been paying $490 in rent. She had been receiving $325 a month in federal and provincial family allowances, a GST rebate of $125 per quarter and $200 in assistance from the Quebec Parental Wage Assistance (PWA) Program for low-income families.
[7] When Mr. Morrissette came to live with her, they shared the rent and food expenses. However, she paid the cable and telephone bills. They have now moved and are paying a higher rent of $745 a month, of which she pays $200. However, she claims she still pays for half the food. She buys her own clothing and pays her daughter's expenses. She thus finds the family income calculation unfair because it does not represent the economic reality of the household as it pertains to her.
[8] In her notice of appeal and testimony, she stated that her daughter is not her de facto spouse's child and that her de facto spouse already has obligations to his own children. Her de facto spouse has no rights with respect to her daughter and her daughter is entirely her responsibility. She needs the child tax benefit to meet her daughter's primary needs, that is to feed, clothe and educate her. Her daughter's needs have actually increased since she is now attending Cegep.
[9] Louise Girard was the appeals officer on September 26, 2000, when she communicated with the appellant. She filed as Exhibit I-3 the written version of an electronic document showing Guy Morrissette's net income for 1999. That income was $62,328. The appellant's notice of objection was filed as Exhibit I-2.
Analysis
[10] The terms "cohabiting spouse" and "adjusted income" are defined as follows in section 122.6 of the Act:
"cohabiting spouse" ¾"cohabiting spouse" of an individual at any time means the person who at that time is the individual's spouse and who is not at that time living separate and apart from the individual and, for the purpose of this definition, a person shall not be considered to be living separate and apart from an individual at any time unless they were living separate and apart at that time, because of a breakdown of their marriage, for a period of at least 90 days that includes that time.
"adjusted income" ¾"adjusted income" of an individual for a taxation year means the total of all amounts each of which would be the income for the year of the individual or of the person who was the individual's cohabiting spouse at the end of the year if no amount were included in respect of a gain from a disposition of property to which section 79 applies in computing that income.
[11] Subsection 252(4) of the Act provides that words referring to a parent of a taxpayer include the person of the opposite sex who cohabits with the taxpayer in a conjugal relationship and has so cohabited throughout a 12-month period:
(4) In this Act,
(a) words referring to a spouse at any time of a taxpayer include the person of the opposite sex who cohabits at that time with the taxpayer in a conjugal relationship and
(i) has so cohabited with the taxpayer throughout a 12-month period ending before that time, or
(ii) would be a parent of a child of whom the taxpayer would be a parent, if this Act were read without reference to paragraph 1(e) and subparagraph (2)(a)(iii)
and, for the purposes of this paragraph, where at any time the taxpayer and the person cohabit in a conjugal relationship, they shall, at any particular time after that time, be deemed to be cohabiting in a conjugal relationship unless they were not cohabiting at the particular time for a period of at least 90 days that includes the particular time because of a breakdown of their conjugal relationship;
. . .
[12] The deemed overpayment, which in other words is the calculation of the Canada Child Tax Benefit, is provided for in subsection 122.61(1) of the Act, which states that adjusted income is considered in calculating the overpayment or the Canada Child Tax Benefit. Adjusted income, according to the above definition, means the total of the appellant's income and income of her de facto spouse.
[13] The appellant stated that the calculation of family income as required by the Act does not take into account the contemporary reality of conjugal relationships. Couples are formed and reformed, and each spouse has his or her own family background and, in many instances, his or her own children and personal obligations. A number of spouses, themselves included, wish to continue managing their own patrimony independently. It is therefore not appropriate to add the two incomes when contributions to family expenses are not made in proportion to income.
[14] The appellant also argued that the Civil Code of Québec sets out no obligation for a de facto spouse to the other de facto spouse and, consequently, even less to the other spouse's child.
[15] Counsel for the respondent referred to Granger v. Canada Employment and Immigration Commission, [1986] 3 F.C. 70, a decision by the Federal Court of Appeal, and to this Court's decision in Feigenbaum v. Canada, [1999] T.C.J. No. 945 (Q.L.). It was held in those decisions that a court cannot amend the Act but must render judgment in accordance with the provisions of that Act.
Conclusion
[16] In the circumstances of this appeal and on the evidence adduced, I find that the calculation of the adjusted income does not represent the economic reality of the family income at the disposal of the appellant and her de facto spouse. The adjusted income is the total of the two incomes. That, in fact, was not the financial agreement between the appellant and her de facto spouse. In that respect, the appellant argued that their agreement was no different from the agreements of many other de facto spouses.
[17] As the appellant stated, the sharing agreements between de facto spouses who are not the two parents of the children living with them are sometimes not the same as those relating to a traditional family, particularly in cases where each of the de facto spouses has his or her own children and it is accepted by both de facto spouses that the parent alone has obligations and rights with respect to his or her child.
[18] However, the Act makes no provision for these subtleties, which it should perhaps be made to address in cases where de facto spouses each have their own children and do not agree to contribute to the education and support of each other's children, preferring to preserve their own patrimony for their own children. It seems unfair in these circumstances to add to the income of the child's parent the total income of the other spouse since there is no contribution to the education and financial support of the child. This seems contrary to the purpose Parliament intended in establishing the Canada Child Tax Benefit. However, it is for Parliament to amend the Act. The Act being what it is at present, the appeal shall be dismissed.
Signed at Ottawa, Canada, this 6th day of December 2001.
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"Louise Lamarre Proulx" |
J.T.C.C.