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Docket: 2004-2121(IT)I |
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BETWEEN: |
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DANIELLE DUBORD, |
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Appellant, |
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and |
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HER MAJESTY THE QUEEN,
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Respondent. |
[OFFICIAL ENGLISH TRANSLATION]
Appeals heard on December 6, 2004, at Québec, Quebec
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Before: The Honourable Justice Paul Bédard |
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Appearances: |
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For the Appellant: |
The Appellant herself |
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Counsel for the Respondent: |
Benoît Mandeville |
____________________________________________________________________
JUDGMENT
The appeals from the assessments made under the Income Tax Act for the 2000, 2001 and 2002 taxation years are dismissed, in accordance with the attached Reasons for Judgment.
Signed at Ottawa, Canada, this 11th day of January 2005.
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"Paul Bédard" |
Bédard J.
Translation certified true
on this 8th day of April 2005
Aveta Graham, Translator
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Citation: 2005TCC18 |
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Date: 20050111 |
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Docket: 2004-2121(IT)I |
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BETWEEN: |
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DANIELLE DUBORD, |
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Appellant, |
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and |
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HER MAJESTY THE QUEEN,
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Respondent. |
[OFFICIAL ENGLISH TRANSLATION]
REASONS FOR JUDGMENT
BédardJ.
[1] The Appellant is appealing from the reassessments dated August 29, 2003, for the 2000 and 2001 taxation years and from the reassessment dated October 2, 2003, for the 2002 taxation year. In those assessments, the Minister of National Revenue (the "Minister") included in the Appellant's income support amounts that she received from her former common-law spouse. Those amounts were $7,996 in 2000, $8,196 in 2001 and $8,196 in 2002.
[2] The issue is whether the Appellant received the support pursuant to a judgment rendered by the Superior Court of Quebec on April 3, 1987, or pursuant to a second judgment from the same Court dated October 11, 1988.
[3] Under paragraph 56(1)(c.1) of the Income Tax Act (the "Act"), the support payments received pursuant to an order made by a competent tribunal after February 10, 1988, and before 1993 would be taxable in computing the Appellant's income. However, the payments received pursuant to an order made by a competent tribunal before February 11, 1988, would be taxable only if the payor and the recipient had made a choice to that effect, which was not the case here.
[4] The two Superior Court judgments in question were filed as Exhibits A-1 and A-4. An agreement entered into between the Appellant and her former common-law spouse on April 30, 1988, was also filed as Exhibit A-4.
[5] Under the first judgment, the Appellant's former common-law spouse was required to pay the Appellant support of $447.61 a month for his daughter for a period of one year starting on November 1, 1986, and $385 a month thereafter. The judgment also established the Appellant's interim access rights with regard to his daughter.
[6] The second judgment confirmed an agreement entered into between the Appellant and her former spouse. The relevant part of the second judgment reads as follows:
[translation]
CERTIFIES the agreement of the parties dated August 10, 1988, RATIFIES and DECLARES IT BINDING to stand as if each of its clauses were stated at length herein and ORDERS the parties to comply therewith;
[7] The preamble to the agreement even states the circumstances of the first judgment and the fact that the parties had opted for conciliation and that they had come to an agreement. For the most part, the stipulations of the agreement concern the issue of the Appellant's former common-law spouse's access to his daughter, but paragraph 2 provided that the Appellant would have custody of their daughter and paragraph 5 stated that the former common-law spouse was to pay the Appellant support of $385 a month.
[8] The Appellant submits that the judgment of April 3, 1987, established her right to receive support from her former spouse and also determined his visiting and access rights with regard to his daughter. In her view, the obligation established by the first judgment to pay support was not amended by the second. She argues that the fact that the preamble to the agreement of August 30, 1988, refers to her former common-law spouse's existing support obligation and the fact that the preamble was incorporated into the agreement leads to the conclusion that the source of the obligation had not changed, that that source was still the first judgment. The Appellant claimed that the parties had agreed by the agreement of August 30, 1988, to resolve only the question of visiting and access rights. Counsel for the Respondent submits that the judgment of October 11, 1988, established the former spouse's obligation to pay the Appellant support and determined his visiting and access rights with regard to his daughter. In his view, the second judgment had the effect of entirely replacing the first judgment of April 3, 1987, rather than making certain amendments to it. It should be noted that the first judgment provides that:
[translation]
. . . this order shall remain in effect until the parties have come to an agreement amending the above terms and conditions. . .
[9] Counsel for the Respondent emphasized that the agreement of August 30, 1988, addressed the question of the support that the former spouse must pay, and did so not only in its preamble, but also in its very conditions.
[10] In fact, paragraph 5 states:
[translation]
The Respondent shall remit to the Applicant on the first day of each month payments in the amount of $385 for the benefit and support of his minor daughter Sarah, and that support shall be indexed every year in accordance with the Act;
[11] Counsel for the Respondent referred to this Court's decision in Hill v. The Queen, [1993] T.C.J. No. 317, in which the Appellant objected to the inclusion of certain amounts of support in her income. Until June 27, 1990, the Appellant had received support of $225 a month, which was not taxable. On June 27, 1990, a new order was made increasing the support to $450 a month. The Court in that case had to decide whether the new order of June 27 had the effect of eliminating the entitlement to support that flowed from the previous orders or whether it increased the amount payable without disturbing the basic foundations of the previous orders.
[12] Rowe T.C.J., in Hill, supra, held that since the Court rendered a new order establishing payment of a certain amount, the entire amount was payable pursuant to the new order, not only the portion representing an increase in maintenance. The fact that an amount was set in the new order had the effect of creating a new right and obligation respecting the amount stated. A new order concerning the same subject or matter as a previous order is considered as having replaced the previous order and subsequently becomes the legal basis of the obligation.
[13] Counsel for the Respondent also referred to this Court's decision in Pierre Gagnon v. The Queen, [2004] T.C.J. 551 (2002-2240(IT)I). In that case, the Minister denied Mr. Gagnon (the former spouse of the Appellant in the instant case) the deduction, in computing his income for the 1998, 1999 and 2000 taxation years, of the support amounts that he paid to his former spouse (the Appellant in the instant case). With essentially the same facts before him, Paris J. found that the second judgment of the Superior Court represents a new support order, even though the amount of the obligation remained at the same level as previously. In his view, starting on October 11, 1988, support was paid pursuant to that judgment. He added:
In my view, this finding also follows from the fact that the parties to the agreement of August 30, 1988, exhaustively addressed the questions of custody, access rights and support instead of merely seeking amendments to the previous judgment.
[14] For the same reasons as those set out by Paris J. in Gagnon, supra, I find that the second judgment of the Superior Court represents a new support order and that, from October 11, 1988, support was paid pursuant to that judgment and the monthly payments must therefore be included in computing the Appellant's income as support pursuant to paragraph 56(1)(b) of the Act for the years in question.
[15] For all of those reasons, the appeals are dismissed.
Signed at Ottawa, Canada, this 11th day of January 2005.
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"Paul Bédard" |
Bédard J.
Translation certified true
on this 8th day of April 2005
Aveta Graham, Translator
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CITATION: |
2005TCC18 |
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COURT FILE NO.: |
2004-2121(IT)I |
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STYLE OF CAUSE: |
Danielle Dubord and H.M.Q. |
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PLACE OF HEARING: |
Québec, Quebec |
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DATE OF HEARING: |
December 6, 2004 |
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REASONS FOR JUDGMENT BY: |
The Honourable Justice Paul Bédard |
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DATE OF JUDGMENT: |
January 11, 2005 |
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APPEARANCES: |
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For the Appellant: |
The Appellant herself |
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Counsel for the Respondent: |
Benoît Mandeville |
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COUNSEL OF RECORD: |
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For the Appellant: |
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Name: |
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Firm: |
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For the Respondent: |
John H. Sims Deputy Attorney General of Canada Ottawa, Canada |