Date: 20020924
Docket: 2001-4634-IT-I
BETWEEN:
KELLY GARRETT,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
Reasons for Judgment
Angers, J.T.C.C.
[1] This appeal under the informal procedure was heard in Edmundston, New Brunswick, on August 21, 2002. The Appellant is appealing a determination of child tax benefit dated February 20, 2001, wherein the Minister of National Revenue (the "Minister") assessed the Appellant for an overpayment of $633.30 for the 1996 base taxation year and of $2,533.20 for the 1997 base taxation year. The issue is whether the Appellant was the eligible individual in respect of the qualified dependants-her sons Brandon Roy, born January 11, 1988, and Mason Roy, born May 24, 1990-for the months of May and June 1998 for the 1996 base taxation year and from July 1998 to January 1999 and for May 1999 for base taxation year 1997.
[2] At the end of the trial, it became clear from the evidence that although the child tax benefit cheques were made out to the Appellant and sent to her address, the benefits were used by the eligible individual, namely the children's father and the Appellant's husband, Eric Roy, who had the children with him. As a result, counsel for the Respondent agreed that the overpayment of $633.30 for May and June 1998 with respect to base taxation year 1996 and of $316.65 for the month of July 1998 with respect to base taxation year 1997 need not be reimbursed by the Appellant as the benefits were used by the eligible individual, Eric Roy. It is therefore so ordered. The remaining period in issue thus relates to base taxation year 1997 and comprises the months of August 1998 to January 1999 and May of 1999.
[3] The Appellant and her husband separated on April 15, 1998. The Appellant left the matrimonial home and both qualified dependants remained there with their father. In July and August of that year, the Appellant and her husband shared custody of their children. The arrangement was that each parent would have the children for periods of two weeks at a time. In September of 1998, both children resided with their father until a disagreement occurred between the latter and the elder son who, as a result, moved in with his mother on the eighth of that month.
[4] The Appellant testified that, in November of the same year, her former husband lost his job and her younger son moved in with her. Both children resided with her until a final custody order dated September 20, 1999 granted her former husband legal custody of both qualified dependants. Prior to that final custody order, an interim order made on May 4, 1999 had granted the Appellant custody of both qualified dependants. The Appellant has been assessed for overpayments posterior to May 4, 1999.
[5] Her former husband, Eric Roy, testified that it was only in February 1999 that he lost his job and that it was from that time that they shared custody and that each had the children for periods of one week at a time. That arrangement lasted until the interim custody order of May 4, 1999, when he moved to another location. As for his son Brandon, Eric Roy acknowledged that he moved in with his mother on September 8, 1998 but added that he returned to live with him on December 1, 1998. To aid his memory, Eric Roy noted on a calendar where his children were staying. These notes identify the time spent by both children with each parent during the periods in issue.
[6] The Appellant applied for child tax benefits in March of 1999. In that application, she indicated the Respondent that both children had started living with her on February 20, 1999 and that the explanation for the change was a custody battle. She further stated that she and Eric Roy were sharing custody at that time and that the children were spending one week with her and one week with their father. The date of the application is consistent with the evidence of Eric Roy as to the time he lost his job and the time that he would have asked the Appellant to share custody and care for the children on a more regular basis. His recollection of these events seems more accurate and I accordingly accept his version.
[7] The Appellant, in order to receive the Canada Child Tax Benefit, must prove on a balance of probabilities that she was the eligible individual for the periods in issue. Section 122.6 of the Income Tax Act (the "Act") defines "eligible individual" as follows:
"eligible individual" - "eligible individual" in respect of a qualified dependant at any time means a person who at that time
(a) resides with the qualified dependant,
(b) is the parent of the qualified dependant who primarily fulfils the responsibility for the care and upbringing of the qualified dependant,
(c) is resident in Canada or, where the person is the cohabiting spouse of a person who is deemed under subsection 250(1) to be resident in Canada throughout the taxation year that includes that time, was resident in Canada in any preceding taxation year,
(d) is not described in paragraph 149(1)(a) or (b), and
(e) is, or whose cohabiting spouse is, a Canadian citizen or a person who
(i) is a permanent resident (within the meaning assigned by the Immigration Act),
(ii) is a visitor in Canada or the holder of a permit in Canada (within the meanings assigned by the Immigration Act) who was resident in Canada throughout the 18 month period preceding that time, or
(iii) was determined before that time under the Immigration Act, or regulations made under that Act, to be a Convention refugee,
and for the purposes of this definition,
(f) where the qualified dependant resides with the dependant's female parent, the parent who primarily fulfils the responsibility for the care and upbringing of the qualified dependant is presumed to be the female parent,
(g) the presumption referred to in paragraph (f) does not apply in prescribed circumstances, and
(h) prescribed factors shall be considered in determining what constitutes care and upbringing.
[8] Section 6302 of the Income Tax Regulations (the "Regulations"), which appears in Part LXIII of those Regulations, prescribes the factors to be considered in determining what constitutes care and upbringing of a qualified dependant. Section 6302 reads as follows:
FACTORS
6302. For the purposes of paragraph (h) of the definition "eligible individual" in section 122.6 of the Act, the following factors are to be considered in determining what constitutes care and upbringing of a qualified dependant:
(a) the supervision of the daily activities and needs of the qualified dependant;
(b) the maintenance of a secure environment in which the qualified dependant resides;
(c) the arrangement of, and transportation to, medical care at regular intervals and as required for the qualified dependant;
(d) the arrangement of, participation in, and transportation to, educational, recreational, athletic or similar activities in respect of the qualified dependant;
(e) the attendance to the needs of the qualified dependant when the qualified dependant is ill or otherwise in need of the attendance of another person;
(f) the attendance to the hygienic needs of the qualified dependant on a regular basis;
(g) the provision, generally, of guidance and companionship to the qualified dependant; and
(h) the existence of a court order in respect of the qualified dependant that is valid in the jurisdiction in which the qualified dependant resides.
[9] Both children in this case are qualified dependants. They were not the subject of any court order respecting custody during the periods in issue, except for the order of May 4, 1999, granting interim custody to the Appellant. The father acknowledges in Exhibit R-4 that, in May 1999, one of the months in issue, the children were both living with their mother. No other evidence was presented regarding that month that might assist me in considering the other factors prescribed by regulation. Since they were at that time residing with the Appellant and were the subject of a custody order, I find that the Appellant was the eligible individual for the month of May 1999.
[10] As for the period from August 1998 to January 1999, the Appellant was able to establish that she was the eligible individual with regard to her son Brandon only for the months of September, October and November 1998, as he lived and resided with her during those months. Brandon returned to live with his father on December 1, 1998. The evidence presented failed to show that there were any changes in August 1998 or thereafter, other than the fact that Brandon lived with his mother for the three months, referred to above. I am thus not satisfied that the Appellant did anything to change her status to that of eligible individual. The Appellant acknowledged that her husband was the eligible individual for the first months after their separation. It was only in February of 1999 that the Appellant assumed more responsibilities with respect to her children and thereby brought herself within the definition of eligible individual.
[11] I have no doubt that the Appellant never stopped caring for her children at any time but the extent of her care during the period in issue was insufficient to meet the requirements of the definition. I have considered the letters from the school principal submitted by the Appellant but fail to see how the principal, who did not testify to substantiate her conclusion, could have determined that the Appellant was the primary caregiver.
[12] I therefore find that the Appellant was not the eligible individual for either qualified dependant in August and December 1998 and in January 1999. As for September, October and November 1998, I find that she was the eligible individual for her son Brandon only. With respect to May 1999, I find that she was the eligible individual for both qualified dependants. It was agreed by the Respondent at trial that the Appellant need not reimburse any overpayment for the months of May, June and July 1998. I therefore allow the appeal and refer the matter back to the Minister for redetermination on the basis set forth in these Reasons for Judgment.
Signed at Ottawa, Canada, this 24th day of September 2002.
|
"François Angers" |
J.T.C.C.COURT FILE NO.: 2001-4634(IT)I
STYLE OF CAUSE: KELLY GARRETT
and Her Majesty the Queen
PLACE OF HEARING: Edmundston, New Brunswick
DATE OF HEARING: August 21, 2002
REASONS FOR JUDGMENT BY: The Honourable François Angers
DATE OF JUDGMENT: September 24, 2002
APPEARANCES:
For the Appellant: The Appellant herself
Counsel for the Respondent: Claude Lamoureux
COUNSEL OF RECORD:
For the Appellant:
Name:
Firm:
For the Respondent: Morris Rosenberg
Deputy Attorney General of Canada
Ottawa, Canada
2001-4634(IT)I
BETWEEN:
KELLY GARRETT,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
Appeals heard on August 21 2002, at Edmundston, New Brunswick, by
the Honourable Judge François Angers
Appearances
For the Appellant: The Appellant herself
Counsel for the Respondent: Claude Lamoureux
JUDGMENT
The appeals from the assessments made under the Income Tax Act for base taxation years 1996 and 1997 are allowed, and the assessments are referred back to the Minister of National Revenue for reconsideration and reassessment on the basis set forth in these Reasons for Judgment.
Signed at Ottawa, Canada, this 24th day of September 2002.
|
"François Angers" |
J.T.C.C.