PATRICK JAMES Applicant v. HER MAJESTY THE QUEEN, 2003 FCA 164

Date: 20030326 Docket: A-15-02 Neutral citation: 2003 FCA 164 CORAM: DÉCARY J.A. NOËL J.A. SHARLOW J.A. BETWEEN: PATRICK JAMES Applicant and HER MAJESTY THE QUEEN Respondent Heard at Vancouver, British Columbia on March 26, 2003. Judgment delivered from the Bench at Vancouver, British Columbia, on March 26, 2003. REASONS FOR JUDGMENT OF THE COURT BY: NOËL J.A. Date: 20030326 Docket: A-15-02 Neutral citation: 2003 FCA 164 CORAM: DÉCARY J.A. NOËL J.A. SHARLOW J.A.

BETWEEN: PATRICK JAMES Applicant and HER MAJESTY THE QUEEN Respondent REASONS FOR JUDGMENT OF THE COURT (Delivered from the Bench at Vancouver, British Columbia on March 26, 2003) NOËL J.A. [ 1 ] This is an application for Judicial Review of a decision of Judge Mogan of the Tax Court of Canada (reported as James v.

Canada, 2002 D.T.C. 1723 ; 2001 CanLII 873 (TCC) , [2002] 2 C.T.C. 2376 ) dismissing the appeal from an assessment issued under the Income Tax Act (the "Act") with respect to the applicant's 1998 taxation year. [ 2 ] The sole issue is whether the applicant is entitled to deduct moving expenses from dividend income. The Trial Judge dismissed the applicant's appeal on the basis that subparagraph 62(1)(c)(

i) of the Act did not allow the applicant to deduct moving expenses from property income, namely dividend income. Subparagraph 62(1)(c)(

i) provides. 62.

(1) There may be deducted in computing a taxpayer's income 62.

(1) Un contribuable peut déduire dans le calcul de son revenu pour

(1) There may be deducted in computing a taxpayer's income for a taxation year amounts paid by the taxpayer as or on account of moving expenses incurred in respect of an eligible relocation, to the extent that (

c) the total of those amounts does not exceed (i) ... the taxpayer's income for the year from the taxpayer's employment at a new work location or from carrying on the business at the new work location, as the case may be, ... 62.

(1) Un contribuable peut déduire dans le calcul de son revenu pour une année d'imposition les sommes qu'il a payées au

titre des frais de déménagement engagés relativement à une réinstallation admissible dans la mesure où, à la fois:

c) leur total ne dépasse pas le montant applicable suivant: (i) [...] le revenu du contribuable pour l'année tiré de son emploi au nouveau lieu de travail ou de l'exploitation de l'entreprise au nouveau lieu de travail, selon le cas, [...] [ 3 ] The applicant had no income from employment or from carrying on business at a new work location from which to deduct moving expenses. As pointed out by the Tax Court Judge, the applicant could have qualified for the deduction had he been rewarded in the form of a salary.

In choosing to receive dividends on the advice of his accountant, the applicant derived certain advantages. But he thereby lost the possibility of deducting his moving expenses. [ 4 ] The application will be dismissed with costs. (Sgd.) "Marc Noël" J.A. FEDERAL COURT OF APPEAL NAMES OF COUNSEL AND SOLICITORS OF RECORD DOCKET: A-15-02 STYLE OF CAUSE: Patrick James v. Her Majesty The Queen PLACE OF HEARING: Vancouver DATE OF HEARING: March 26, 2003 REASONS FOR JUDGMENT : DÉCARY, NOËL & SHARLOW JJ.A. RENDERED FROM THE BENCH BY: NOËL, J.A. APPEARANCES : Mr. Patrick James APPLICANT on his own behalf Ms.

Jasmine Sidhu FOR THE RESPONDENT Ms. Lisa M. Macdonell SOLICITORS OF RECORD : Mr. Patrick James APPLICANT on his own behalf Mr. Morris Rosenberg FOR THE RESPONDENT Deputy Attorney General of Canada