Sénéchal v. The Queen

Sénéchal v. The Queen
Court (s) Database
Tax Court of Canada Judgments
Date
2011-08-25
Neutral citation
2011 TCC 365
File numbers
2008-1830(IT)I, 2008-1838(IT)I, 2008-1839(IT)I, 2008-1841(IT)I, 2008-1843(IT)I, 2008-1844(IT)I, 2008-1846(IT)I, 2008-1849(IT)I, 2008-1850(IT)I, 2008-1852(IT)I, 2008-1853(IT)I, 2008-1855(IT)I
Judges and Taxing Officers
Lucie Lamarre
Subjects
Income Tax Act
Decision Content
Docket: 2008-1830(IT)I
BETWEEN:
MARC SÉNÉCHAL,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH TRANSLATION]
____________________________________________________________________
Appeals heard on common evidence with the appeals of
Richard Gagné 2008-1838(IT)I, Denis Boucher 2008-1839(IT)I,
Michel Bergeron 2008-1841(IT)I, Denis Harvey 2008-1843(IT)I,
Hélène Leclerc 2008-1844(IT)I, Dominic Lemieux 2008-1846(IT)I,
André Parent 2008-1849(IT)I, Charles Parent 2008-1850(IT)I,
Jocelyn Simard 2008-1852(IT)I, Michel Simard 2008-1853(IT)I and
Luc Turcotte 2008-1855(IT)I, on June 30, 2011, at Québec, Quebec.
Before: The Honourable Justice Lucie Lamarre
Appearances:
Counsel for the appellant:
Robert Marcotte
Counsel for the respondent:
Anne Poirier
____________________________________________________________________
JUDGMENT
The appeals from the reassessments made under the Income Tax Act, with respect to the 2002, 2003 and 2004 taxation years, are dismissed.
Signed at Ottawa, Canada, this 25th day of August 2011.
"Lucie Lamarre"
Lamarre J.
Translation certified true
On this 27th day of October 2011
Monica F. Chamberlain, Reviser
Docket: 2008-1838(IT)I
BETWEEN :
Richard Gagné,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH TRANSLATION]
____________________________________________________________________
Appeals heard on common evidence with the appeals of
Marc Sénéchal 2008-1830(IT), Denis Boucher 2008-1839(IT)I,
Michel Bergeron 2008-1841(IT)I, Denis Harvey 2008-1843(IT)I,
Hélène Leclerc 2008-1844(IT)I, Dominic Lemieux 2008-1846(IT)I,
André Parent 2008-1849(IT)I, Charles Parent 2008-1850(IT)I,
Jocelyn Simard 2008-1852(IT)I, Michel Simard 2008-1853(IT)I and
Luc Turcotte 2008-1855(IT)I, on June 30, 2011, at Québec, Quebec.
Before: The Honourable Justice Lucie Lamarre
Appearances:
Counsel for the appellant:
Robert Marcotte
Counsel for the respondent:
Anne Poirier
____________________________________________________________________
JUDGMENT
The appeals from the reassessments made under the Income Tax Act with respect to the 2002, 2003 and 2004 taxation years are dismissed.
Signed at Ottawa, Canada, this 25th day of August 2011.
"Lucie Lamarre"
Lamarre J.
Translation certified true
On this 27th day of October 2011
Monica F. Chamberlain, Reviser
Docket: 2008-1839(IT)I,
BETWEEN:
Denis Boucher
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH TRANSLATION]
____________________________________________________________________
Appeals heard on common evidence with the appeals of
Marc Sénéchal 2008-1830(IT), Richard Gagné 2008-1838(IT)I,
Michel Bergeron 2008-1841(IT)I, Denis Harvey 2008-1843(IT)I,
Hélène Leclerc 2008-1844(IT)I, Dominic Lemieux 2008-1846(IT)I,
André Parent 2008-1849(IT)I, Charles Parent 2008-1850(IT)I,
Jocelyn Simard 2008-1852(IT)I, Michel Simard 2008-1853(IT)I and
Luc Turcotte 2008-1855(IT)I, on June 30, 2011, at Québec, Quebec.
Before: The Honourable Justice Lucie Lamarre
Appearances:
Counsel for the appellant:
Robert Marcotte
Counsel for the respondent:
Anne Poirier
____________________________________________________________________
JUDGMENT
The appeals from the reassessments made under the Income Tax Act with respect to the 2002, 2003 and 2004 taxation years are dismissed.
Signed at Ottawa, Canada, this 25th day of August 2011.
"Lucie Lamarre"
Lamarre J.
Translation certified true
On this 27th day of October 2011
Monica F. Chamberlain, Reviser
Docket: 2008-1841(IT)I
BETWEEN:
Michel Bergeron
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH TRANSLATION]
____________________________________________________________________
Appeals heard on common evidence with the appeals of
Marc Sénéchal 2008-1830(IT), Richard Gagné 2008-1838(IT)I, Denis Boucher 2008-1839(IT)I, Denis Harvey 2008-1843(IT)I,
Hélène Leclerc 2008-1844(IT)I, Dominic Lemieux 2008-1846(IT)I,
André Parent 2008-1849(IT)I, Charles Parent 2008-1850(IT)I,
Jocelyn Simard 2008-1852(IT)I, Michel Simard 2008-1853(IT)I and
Luc Turcotte 2008-1855(IT)I, on June 30, 2011, at Québec, Quebec.
Before: The Honourable Justice Lucie Lamarre
Appearances:
Counsel for the appellant:
Robert Marcotte
Counsel for the respondent:
Anne Poirier
____________________________________________________________________
JUDGMENT
The appeals from the reassessments made under the Income Tax Act with respect to the 2002, 2003 and 2004 taxation years are dismissed.
Signed at Ottawa, Canada, this 25th day of August 2011.
"Lucie Lamarre"
Lamarre J.
Translation certified true
On this 27th day of October 2011
Monica F. Chamberlain, Reviser
Docket: 2008-1843(IT)I
BETWEEN:
Denis Harvey,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH TRANSLATION]
____________________________________________________________________
Appeals heard on common evidence with the appeals of
Marc Sénéchal 2008-1830(IT), Richard Gagné 2008-1838(IT)I, Denis Boucher 2008-1839(IT)I, Michel Bergeron 2008-1841(IT)I,
Hélène Leclerc 2008-1844(IT)I, Dominic Lemieux 2008-1846(IT)I,
André Parent 2008-1849(IT)I, Charles Parent 2008-1850(IT)I,
Jocelyn Simard 2008-1852(IT)I, Michel Simard 2008-1853(IT)I and
Luc Turcotte 2008-1855(IT)I, on June 30, 2011, at Québec, Quebec.
Before: The Honourable Justice Lucie Lamarre
Appearances:
Counsel for the appellant:
Robert Marcotte
Counsel for the respondent:
Anne Poirier
____________________________________________________________________
JUDGMENT
The appeals from the reassessments made under the Income Tax Act with respect to the 2002, 2003 and 2004 taxation years are dismissed.
Signed at Ottawa, Canada, this 25th day of August 2011.
"Lucie Lamarre"
Lamarre J.
Translation certified true
On this 27th day of October 2011
Monica F. Chamberlain, Reviser
Docket: 2008-1844(IT)I
BETWEEN :
Hélène Leclerc,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH TRANSLATION]
____________________________________________________________________
Appeals heard on common evidence with the appeals of
Marc Sénéchal 2008-1830(IT), Richard Gagné 2008-1838(IT)I, Denis Boucher 2008-1839(IT)I, Michel Bergeron 2008-1841(IT)I, Denis Harvey 2008-1843(IT)I, Dominic Lemieux 2008-1846(IT)I,
André Parent 2008-1849(IT)I, Charles Parent 2008-1850(IT)I,
Jocelyn Simard 2008-1852(IT)I, Michel Simard 2008-1853(IT)I and
Luc Turcotte 2008-1855(IT)I, on June 30, 2011, at Québec, Quebec.
Before: The Honourable Justice Lucie Lamarre
Appearances:
Counsel for the appellant:
Robert Marcotte
Counsel for the respondent:
Anne Poirier
____________________________________________________________________
JUDGMENT
The appeals from the reassessments made under the Income Tax Act with respect to the 2002, 2003 and 2004 taxation years are dismissed.
Signed at Ottawa, Canada, this 25th day of August 2011.
"Lucie Lamarre"
Lamarre J.
Translation certified true
On this 27th day of October 2011
Monica F. Chamberlain, Reviser
Docket: 2008-1846(IT)I
BETWEEN:
Dominic Lemieux,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH TRANSLATION]
____________________________________________________________________
Appeals heard on common evidence with the appeals of
Marc Sénéchal 2008-1830(IT), Richard Gagné 2008-1838(IT)I, Denis Boucher 2008-1839(IT)I, Michel Bergeron 2008-1841(IT)I, Denis Harvey 2008-1843(IT)I, Hélène Leclerc 2008-1844(IT)I,
André Parent 2008-1849(IT)I, Charles Parent 2008-1850(IT)I,
Jocelyn Simard 2008-1852(IT)I, Michel Simard 2008-1853(IT)I,
Luc Turcotte 2008-1855(IT)I, on June 30, 2011, at Québec, Quebec.
Before: The Honourable Justice Lucie Lamarre
Appearances:
Counsel for the appellant:
Robert Marcotte
Counsel for the respondent:
Anne Poirier
____________________________________________________________________
JUDGMENT
The appeals from the reassessments made under the Income Tax Act with respect to the 2002, 2003 and 2004 taxation years are dismissed.
Signed at Ottawa, Canada, this 25th day of August 2011.
"Lucie Lamarre"
Lamarre J.
Translation certified true
On this 27th day of October 2011
Monica F. Chamberlain, Reviser
Docket: 2008-1849(IT)I
BETWEEN:
ANDRÉ Parent,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH TRANSLATION]
____________________________________________________________________
Appeals heard on common evidence with the appeals of
Marc Sénéchal 2008-1830(IT), Richard Gagné 2008-1838(IT)I, Denis Boucher 2008-1839(IT)I, Michel Bergeron 2008-1841(IT)I, Denis Harvey 2008-1843(IT)I, Hélène Leclerc 2008-1844(IT)I, Dominic Lemieux 2008-1846(IT)I, Charles Parent 2008-1850(IT)I,
Jocelyn Simard 2008-1852(IT)I, Michel Simard 2008-1853(IT)I and
Luc Turcotte 2008-1855(IT)I, on June 30, 2011, at Québec, Quebec.
Before: The Honourable Justice Lucie Lamarre
Appearances:
Counsel for the appellant:
Robert Marcotte
Counsel for the respondent:
Anne Poirier
____________________________________________________________________
JUDGMENT
The appeals from the reassessments made under the Income Tax Act with respect to the 2002, 2003 and 2004 taxation years are dismissed.
Signed at Ottawa, Canada, this 25th day of August 2011.
"Lucie Lamarre"
Lamarre J.
Translation certified true
On this 27th day of October 2011
Monica F. Chamberlain, Reviser
Docket: 2008-1850(IT)I
BETWEEN:
Charles Parent,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH TRANSLATION]
____________________________________________________________________
Appeals heard on common evidence with the appeals of
Marc Sénéchal 2008-1830(IT), Richard Gagné 2008-1838(IT)I, Denis Boucher 2008-1839(IT)I, Michel Bergeron 2008-1841(IT)I, Denis Harvey 2008-1843(IT)I, Hélène Leclerc 2008-1844(IT)I, Dominic Lemieux 2008-1846(IT)I, André Parent 2008-1849(IT)I,
Jocelyn Simard 2008-1852(IT)I, Michel Simard 2008-1853(IT)I and
Luc Turcotte 2008-1855(IT)I, on June 30, 2011, at Québec, Quebec.
Before: The Honourable Justice Lucie Lamarre
Appearances:
Counsel for the appellant:
Robert Marcotte
Counsel for the respondent:
Anne Poirier
____________________________________________________________________
JUDGMENT
The appeals from the reassessments made under the Income Tax Act with respect to the 2002, 2003 and 2004 taxation years are dismissed.
Signed at Ottawa, Canada, this 25th day of August 2011.
"Lucie Lamarre"
Lamarre J.
Translation certified true
On this 27th day of October 2011
Monica F. Chamberlain, Reviser
Docket: 2008-1852(IT)I
BETWEEN:
Jocelyn Simard,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH TRANSLATION]
____________________________________________________________________
Appeals heard on common evidence with the appeals of
Marc Sénéchal 2008-1830(IT), Richard Gagné 2008-1838(IT)I,
Denis Boucher 2008-1839(IT)I, Michel Bergeron 2008-1841(IT)I,
Denis Harvey 2008-1843(IT)I, Hélène Leclerc 2008-1844(IT)I, Dominic Lemieux 2008-1846(IT)I, André Parent 2008-1849(IT)I, Charles Parent 2008-1850(IT)I, Michel Simard 2008-1853(IT)I and
Luc Turcotte 2008-1855(IT)I, on June 30, 2011, at Québec, Quebec.
Before: The Honourable Justice Lucie Lamarre
Appearances:
Counsel for the appellant:
Robert Marcotte
Counsel for the respondent:
Anne Poirier
____________________________________________________________________
JUDGMENT
The appeals from the reassessments made under the Income Tax Act with respect to the 2002, 2003 and 2004 taxation years are dismissed.
Signed at Ottawa, Canada, this 25th day of August 2011.
"Lucie Lamarre"
Lamarre J.
Translation certified true
On this 27th day of October 2011
Monica F. Chamberlain, Reviser
Docket: 2008-1853(IT)I
BETWEEN:
Michel Simard,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH TRANSLATION]
____________________________________________________________________
Appeals heard on common evidence with the appeals of
Marc Sénéchal 2008-1830(IT), Richard Gagné 2008-1838(IT)I, Denis Boucher 2008-1839(IT)I, Michel Bergeron 2008-1841(IT)I, Denis Harvey 2008-1843(IT)I, Hélène Leclerc 2008-1844(IT)I, Dominic Lemieux 2008-1846(IT)I, André Parent 2008-1849(IT)I, Charles Parent 2008-1850(IT)I, Jocelyn Simard 2008-1852(IT)I and Luc Turcotte 2008-1855(IT)I, on June 30, 2011, at Québec, Quebec.
Before: The Honourable Justice Lucie Lamarre
Appearances:
Counsel for the appellant:
Robert Marcotte
Counsel for the respondent:
Anne Poirier
____________________________________________________________________
JUDGMENT
The appeals from the reassessments made under the Income Tax Act with respect to the 2002, 2003 and 2004 taxation years are dismissed.
Signed at Ottawa, Canada, this 25th day of August 2011.
"Lucie Lamarre"
Lamarre J.
Translation certified true
On this 27th day of October 2011
Monica F. Chamberlain, Reviser
Docket: 2008-1855(IT)I
BETWEEN:
Luc Turcotte,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH TRANSLATION]
____________________________________________________________________
Appeals heard on common evidence with the appeals of
Marc Sénéchal 2008-1830(IT), Richard Gagné 2008-1838(IT)I, Denis Boucher 2008-1839(IT)I, Michel Bergeron 2008-1841(IT)I, Denis Harvey 2008-1843(IT)I, Hélène Leclerc 2008-1844(IT)I, Dominic Lemieux 2008-1846(IT)I, André Parent 2008-1849(IT)I, Charles Parent 2008-1850(IT)I, Jocelyn Simard 2008-1852(IT)I and Michel Simard 2008-1853(IT)I, on June 30, 2011, at Québec, Quebec.
Before: The Honourable Justice Lucie Lamarre
Appearances:
Counsel for the appellant:
Robert Marcotte
Counsel for the respondent:
Anne Poirier
____________________________________________________________________
JUDGMENT
The appeals from the reassessments made under the Income Tax Act with respect to the 2002, 2003 and 2004 taxation years are dismissed.
Signed at Ottawa, Canada, this 25th day of August 2011.
"Lucie Lamarre"
Lamarre J.
Translation certified true
On this 27th day of October 2011
Monica F. Chamberlain, Reviser
Citation: 2011 TCC 365
Date: 20110825
Docket: 2008-1830(IT)I
BETWEEN:
MARC SÉNÉCHAL,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
AND BETWEEN: Docket: 2008-1838(IT)I
RICHARD GAGNÉ,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
AND BETWEEN: Docket: 2008-1839(IT)I
DENIS BOUCHER,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
AND BETWEEN: Docket: 2008-1841(IT)I
MICHEL BERGERON,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
AND BETWEEN: Docket: 2008-1843(IT)I
DENIS HARVEY,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
AND BETWEEN: Docket: 2008-1844(IT)I
HÉLÈNE LECLERC,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
AND BETWEEN: Docket: 2008-1846(IT)I
DOMINIC LEMIEUX,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
AND BETWEEN: Docket: 2008-1849(IT)I
ANDRÉ PARENT,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
AND BETWEEN: Docket: 2008-1850(IT)I
CHARLES PARENT,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
AND BETWEEN: Docket: 2008-1852(IT)I
JOCELYN SIMARD,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
AND BETWEEN: Docket: 2008-1853(IT)I
MICHEL SIMARD,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
AND BETWEEN: Docket: 2008-1855(IT)I
LUC TURCOTTE,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH TRANSLATION]
REASONS FOR JUDGMENT
Lamarre J.
[1] During the years in issue, namely 2002, 2003 and 2004, the twelve appellants were police officers for the municipality of Saguenay and were members of the executive of the Fraternité des policiers et policières de la Ville de Saguenay (the Police Union).
[2] During those years, they received funds from the Police Union to cover some of the expenses they incurred in connection with their union duties. The expenses included transportation and meal expenses for all the appellants, and, for some of the appellants, child care, Internet and computer expenses, and allowances for attending union meetings.
[3] The Canada Revenue Agency (CRA) took the position that the amounts were taxable allowances received in the course of an office of employment within the meaning of sections 5 and 6 of the Income Tax Act (ITA), and the Minister of National Revenue (the Minister) assessed each appellant in order to add the amounts to their income in accordance with the detailed table adduced by the appellants as Exhibit A‑2. The appellants dispute the addition of these amounts to their taxable income.
The facts
[4] The sole witness for the appellants was Marc Sénéchal, who was elected president of the Police Union in late 2001. He testified on behalf of all the appellants.
[5] Mr. Sénéchal explained that the Police Union was created after the amalgamation of the cities of Chicoutimi, Jonquière and La Baie. Before the amalgamation, each city had a distinct collective agreement with its own police service. The Chicoutimi collective agreement expired on December 31, 2001, and the other two collective agreements expired on December 31, 2002 (Exhibit A‑1, tables 20, 21 and 22).
[6] On January 10, 2002, an agreement on the terms of integration (Exhibit A-1, tab 18) was reached between the Comité de transition de la ville de Saguenay, the party of the first part, and the Syndicat des policiers de Chicoutimi, the Fraternité des policiers et policières de Jonquière, and the Syndicat des policiers-pompiers de ville de La Baie, the parties of the second part. It stated that, effective February 18, 2002, the provisions of the Convention collective régissant un policier [the police officer collective agreement] would continue to apply, except to the extent that they were specifically amended by this agreement (section 10.1).
[7] Section 9 of the agreement of January 10, 2002, contained specific rules regarding leave for union business from February 18, 2002, onward. The section stipulated as follows:
[translation]
SECTION 9 - LEAVES OF ABSENCE FOR UNION BUSINESS
9.01 As of February 18, 2002, the provisions of the collective agreements concerning leaves of absence for union business (Chicoutimi: clauses 5.03, 5.04 and 5.06 to 5.11; Jonquière: clauses 8.01 to 8.03; and La Baie: clauses 5.01 to 5.04, 5.07, and 5.08) shall be replaced by the provisions of this section, until the first collective agreement applicable to all salaried members of the Saguenay municipal police service come into force.
9.02 The employer grants the representatives of all unions permission to be absent from their jobs, without loss of pay, for the activities and in the quanta set out below:
(a) A maximum of six (6) representatives to take part in the sessions of the joint union-management integration committee and in the negotiations, conciliation or arbitration sessions aimed at achieving the first collective agreement applicable to all salaried members of the Service de police de Ville de Saguenay.
(b) A maximum of three (3) representatives to take part in the discussions of the joint health and safety committee formed pursuant to the Act respecting occupational health and safety and any other joint union-management committee, as of the time that such a committee is put in place by the Ville de Saguenay; and in the meantime, the applicable provisions of the collective agreements continue to apply with respect to the number of union representatives on such a committee.
(c) For grievance hearings, two (2) union representatives, plus the employee concerned by the grievance.
(d) In addition, an annual bank of one thousand (1000) hours shall be available to all unions for the purposes of leave for any union business for a representative or member. The employer must be notified at least two (2) days in advance for any leave time to be taken from this bank, unless there are exceptional circumstances, in which case the employer shall not refuse it without valid cause.
9.03 The president of the new Fraternité des policiers et policières de la Ville de Saguenay [the Police Union] is granted leave with pay for a total of five hundred and forty (540) hours per year for his union duties. This time bank must be used in periods of eight (8) or twelve (12) continuous hours based on his work schedule. He must notify the employer at least two (2) days in advance of any day of leave that he intends to take, unless there are exceptional circumstances, in which case the employer shall not refuse it without valid cause.
9.05 Notwithstanding any contrary provision of a collective agreement, where the Ville de Saguenay decides to replace a police officer on leave under this section, it may use temporary police officers, regardless of the duration of the replacement.
[Emphasis added.]
[8] The collective agreement between Ville de Saguenay and the Police Union (Exhibit A‑1, tab 19) was signed on February 22, 2005, and applied to the period from January 1, 2003, to December 31, 2006. Section 5 of the agreement governs union business and leave for union business. It is reproduced below:
[translation]
5.01 General meetings
The Employer authorizes the Union to hold its general meetings on the premises of the service that it designates, outside regular office hours. The request shall be made to the chief of police within a reasonable amount of time.
5.02 Leave for union business
The Employer grants the Union's representatives permission to be absent from work, without loss of pay, for the activities and the quanta set out below:
(a) A maximum of six (6) representatives to participate in the negotiation, conciliation or dispute arbitration sessions aimed at achieving the collective agreement;
(b) a maximum of three (3) representatives to take part in the discussions of the joint health and safety committee formed pursuant to the Act respecting occupational health and safety and any other joint union-management committee, as of the time that such a committee is put in place by the Employer. If the meeting takes place outside the employee's work schedule, the employee shall accumulate compensable time equal to the duration of the meeting and must take this compensable time as time off, subject to the ratios set out in section 15, prior to the end of the calendar year, failing which the employee loses that time.
(c) For grievance hearings, two (2) union representatives, plus the employee concerned by the grievance.
(d) For hearings before the Commissaire à la déontologie policière [police ethics commissioner], the Commission des relations du travail [labour relations board], the Commission de lésions professionnelles [occupational injury board] the Commission des normes du travail [employment standards board], and the disciplinary committee formed under the Règlement sur la discipline des policiers de Ville de Saguenay, one union representative.
(e) In addition, an annual bank of one thousand (1000) hours shall be available to all unions for the purposes of leave for any union business for a representative or member. The employer must be notified at least two (2) days in advance for any leave time to be taken from this bank, unless there are exceptional circumstances, in which case the employer shall not refuse it without valid cause.
5.03 The president of the Fraternité des policiers et policières de la Ville de Saguenay [the Police Union] is granted leave with pay for a total of five hundred and forty (540) hours per year for his union duties. This time bank must be used in periods of ten (10) or twelve (12) continuous hours based on his work schedule. He must notify the employer at least two (2) days in advance of any day of leave that he intends to take, unless there are exceptional circumstances, in which case the employer shall not refuse it without valid cause.
5.04 Sections 3 and 9 apply to replacements in the event of absences caused by the granting of leave under this section.
5.05 If a Union member is elected to the Executive of the Fédération des policiers et policières municipaux du Québec, that Union member may take time off work, without pay, to attend the meetings of that organization for the duration of his mandate, provided he gives the chief of police at least seven days' notice, in writing, of any absence, unless there are exceptional circumstances, in which case the employer shall not refuse it without valid cause.
5.06 The Employer shall make available to the Union an adequate room that is appropriate for holding meetings of its board of directors and for keeping its documents.
[Emphasis added.]
[9] In addition, the Police Union's articles of association and by-laws, adopted on January 22, 2002, and amended on April 24, 2002, stated that the Police Union's executive would consist of 12 members from the three amalgamated unions (four from Jonquière, four from Chicoutimi and four from La Baie) until the signing of the Police Union's first collective agreement. They also stated that the initial pooled capital fund consisted in admission dues of $500 per permanent member (Exhibit A‑1, tab 17, section XXVII). Later on, according to Mr. Sénéchal, this fund was to be financed by weekly deductions from each member's pay (see also section VI of the articles and by-laws of the Police Union: Exhibit A-1, tab 17).
[10] In his testimony, Mr. Sénéchal explained that the members of the executive had the use of a bank of 1000 hours, out of their total work output, to look after their union duties, and that he personally had 540 additional hours as president. Everyone needed to obtain the employer's permission before being absent during their hours of work. Mr. Sénéchal arranged with the employer to devote all his Wednesdays to union duties, and the employer looked after his replacement as the lieutenant in charge of the investigations unit. Mr. Sénéchal says that in actual fact, the members of the Police Union executive tried to meet or carry out their union work outside hours of work in order to limit the amount of leave for union business granted by the employer.
[11] When the appellants were absent during their hours of work, they received their pay from the employer, the Ville de Saguenay, and the Ville de Saguenay was not reimbursed by the Police Union. Some appellants, like Mr. Sénéchal, had to be replaced by the Ville de Saguenay while they were away. Patrol officers were not necessarily replaced.
[12] The appellants received no remuneration from the Police Union. That is why the Police Union adopted a policy on expenses incurred by members of the executive (Exhibit A‑1, tab 15) on February 13, 2002 (the Expense Policy). Mr. Sénéchal explained that since the Police Union spanned three former municipalities which were, according to him, roughly 20 to 25 kilometres apart, the policy sought to cover expenses related to travel, living, lodging, hospitality, long-distance calls, and participation by directors. According to a map (Exhibit I‑3) adduced by the respondent, the total distance between Jonquière and La Baie, via Chicoutimi, is a bit less than 33 km.
[13] Hence, lodging expenses were refundable upon submission of supporting documents. Living expenses were reimbursed without vouchers at a rate of $10 for breakfasts, $20 for lunches and $40 for dinners, with an additional $20 for other incidentals if a member of the executive had to spend the night away from home. (The amount allotted for dinners is double the allotment made in the new collective agreement between the Ville de Saguenay and its police officers: see Exhibit A-1, tab 19, page 883). Travel expenses for personal automobile use were reimbursed at a rate of $0.36 per kilometre outside the municipality Saguenay, and parking was reimbursed upon submission of receipts. Each member was entitled to a $50 hospitality allowance, without receipts, for every event he or she was directed by the Police Union to attend. The members were also entitled to two long-distance phone calls a day. Child care expenses were also reimbursed in some cases, and if so, they were reimbursed at a fixed rate. Lastly, the directors of the Police Union received a $50 director's fee for any event designated by the president, subject to a $1,000 maximum. According to Mr. Sénéchal, the appellants, in their capacity as members of the executive, did not receive these directors' fees. In fact, based on a reading of the Expense Policy, it appears that six directors were entitled to director's fees. Mr. Sénéchal stated that these director's fees were only paid if the union activity took place outside working hours and the member was therefore not being paid by the employer. Also, the reimbursement of expenses incurred by members of the executive was limited to a maximum that varied based on the position held when the travel was within the boundaries of the municipality of Saguenay and when the living expenses were not directly related to their obligation of representation. (See the Expense Policy, Exhibit A-1, tab 15, at page 694.)
[14] All the expenses claimed by the Police Union had to be approved by the president first. In Mr. Sénéchal's case, it was the treasurer who countersigned the expense account approvals. The president was the person who approved union business and travel. The union leave forms required his approval before being sent to the chief of police for approval.
[15] Mr. Sénéchal stated that the Police Union did not have an office during the transitional period which coincides with the period in issue, and that all members needed to be able to operate from home and have access to their own computer and mobile phone. The Police Union could reimburse some of these expenses if they were not incurred for personal use and were reasonable, but all reimbursements needed to be approved in advance by Mr. Sénéchal. And the meetings were most often held in a reserved room at a restaurant, which inevitably gave rise to meal expenses. Mr. Sénéchal said that he claimed all his travel from the Jonquière police station from which he worked. If he was off work that day, he claimed travel from his residence. However, he admitted that he did not have the detail of all his union meetings because he could not find his day planner for the years in question. Nonetheless, he adds that the details were not important to him, because he sent a weekly report to his members. He confirms that all the kilometres of driving claimed from the Police Union matches his trips on Police Union business. The same goes for the other appellants, because he ensured that each person's claims were justified and reasonable.
[16] It appears that the CRA considered all the amounts paid to the appellants for their trips on union business within the municipality of Saguenay — that is to say, between Jonquière, Chicoutimi and La Baie — as taxable benefits. According to the CRA, this travel was not away from the municipality where the employer's establishment at which the employee ordinarily worked was located (see the Exhibit I-1, tab 6, the letter by the CRA, dated February 15, 2006).
Statutory provisions
Income Tax Act,
RSC 1985, c 1 (5th Supp)
PART I – Income Tax
DIVISION B – Computation of Income
Subdivision a – Income or Loss from Office or Employment
Basic Rules
Income from office or employment
5. (1) Subject to this Part, a taxpayer's income for a taxation year from an office or employment is the salary, wages and other remuneration, including gratuities, received by the taxpayer in the year.
. . .
Inclusions
Amounts to be included as income from office or employment
6. (1) There shall be included in computing the income of a taxpayer for a taxation year as income from an office or employment such of the following amounts as are applicable
Value of benefits
(a) the value of board, lodging and other benefits of any kind whatever received or enjoyed by the taxpayer in the year in respect of, in the course of, or by virtue of an office or employment . . .
Personal or living expenses
(b) all amounts received by the taxpayer in the year as an allowance for personal or living expenses or as an allowance for any other purpose, except
. . .
(v) reasonable allowances for travel expenses received by an employee from the employee's employer in respect of a period when the employee was employed in connection with the selling of property or negotiating of contracts for the employee's employer,
. . .
(vii) reasonable allowances for travel expenses (other than allowances for the use of a motor vehicle) received by an employee (other than an employee employed in connection with the selling of property or the negotiating of contracts for the employer) from the employer for travelling away from
(A) the municipality where the employer's establishment at which the employee ordinarily worked or to which the employee ordinarily reported was located, and
(B) the metropolitan area, if there is one, where that establishment was located,
in the performance of the duties of the employee’s office or employment,
(vii.1) reasonable allowances for the use of a motor vehicle received by an employee (other than an employee employed in connection with the selling of property or the negotiating of contracts for the employer) from the employer for travelling in the performance of the duties of the office or employment,
. . .
and for the purposes of subparagraphs 6(1)(b)(v), 6(1)(b)(vi) and 6(1)(b)(vii.1), an allowance received in a taxation year by a taxpayer for the use of a motor vehicle in connection with or in the course of the taxpayer's office or employment shall be deemed not to be a reasonable allowance
(x) where the measurement of the use of the vehicle for the purpose of the allowance is not based solely on the number of kilometres for which the vehicle is used in connection with or in the course of the office or employment, or
(xi) where the taxpayer both receives an allowance in respect of that use and is reimbursed in whole or in part for expenses in respect of that use (except where the reimbursement is in respect of supplementary business insurance or toll or ferry charges and the amount of the allowance was determined without reference to those reimbursed expenses);
PART XVII - Interpretation
Definitions
248. (1) In this Act,
. . .
"office" means the position of an individual entitling the individual to a fixed or ascertainable stipend or remuneration and includes a judicial office, the office of a minister of the Crown, the office of a member of the Senate or House of Commons of Canada, a member of a legislative assembly or a member of a legislative or executive council and any other office, the incumbent of which is elected by popular vote or is elected or appointed in a representative capacity and also includes the position of a corporation director, and "officer" means a person holding such an office.
"employment" means the position of an individual in the service of some other person (including Her Majesty or a foreign state or sovereign) and "servant" or "employee" means a person holding such a position;
"employee" includes officer;
"employed" means performing the duties of an office or employment.
The appellants' arguments
[17] The appellants submit that the amounts received from the Police Union in connection with their union business are not taxable, because they carried out that business on a volunteer basis and the amounts paid by the Police Union served solely to reimburse the expenses that they incurred to carry out their duties. Counsel for the appellants seeks to distinguish this case from the situation in Succession Vachon v. Canada, 2009 FCA 375, [2009] F.C.J. No. 1630 (QL). That situation, which is somewhat similar to this one, was analyzed by the Federal Court of Appeal. The issue was the tax treatment of certain allowances paid to union officials by their central council. The union officials argued that they were volunteers and could not be considered holders of an office or employment with the central council within the meaning of sections 5 and 6 and subsection 248(1) of the ITA, since their positions did not entitle them to any fixed or ascertainable stipend or remuneration. The evidence showed that the officials obtained leave for union business without loss of pay, and that the central council reimbursed the employer for that portion of their pay that was paid during union leave. The Federal Court of Appeal held that the officials were not volunteers and that they held an office entitling them to fixed and ascertainable remuneration. At first instance, it had been accepted that, if they held an office, the allowances were taxable. Counsel for the appellants in the case at bar seek to distinguish that decision on the basis that the Ville de Saguenay was not reimbursed by the Police Union for the salary that it paid them during union leave, and that the appellants cannot be considered to have been entitled to fixed and ascertainable remuneration from the Police Union. Moreover, the appellants submit that a major part of their union activities was outside their hours of work for the Ville de Saguenay, and that they received no remuneration for those activities in such an event.
[18] In the case of appellant André Parent, the Minister added the amounts of $3,055 in 2003 and $3,337 in 2004 to his income under the heading [translation] "Miscellaneous". According to Mr. Sénéchal's explanations, these amounts constitute the Ville de Saguenay's refund of an employment insurance overpayment for several police officers. It is alleged that the municipality paid the Police Union and that the Police Union then remitted the amounts in question to André Parent, the Police Union treasurer. The two cheques in question were signed by Mr. Sénéchal and Mr. Parent on behalf of the Police Union and have been adduced in evidence as Exhibit A‑1, tab 8, page 437. Mr. Parent allegedly deposited these cheques into his personal account and then distributed them, in cash, to all the police officers concerned. According to other documents, the amounts paid by the Ville de Saguenay to the Police Union were $3,101.74 in 2003 and $3,355.78 in 2004. These amounts allegedly correspond to the reduction of the EI contribution rate, of which the employee is entitled to five-twelfths (Exhibit A-1, tab 8, pages 438, 439 and 440). Therefore, according to the counsel for the appellants, these amounts cannot be attributed solely to André Parent.
[19] Counsel for the appellants also relies on the decision of the Quebec Court of Appeal in Québec (Sous-ministre du Revenu) v. Confédération des Caisses populaires et d’économie Desjardins du Québec, 2002 DTC 7404, [2001] Q.J. No. 2623 (QL), which establishes that living expense allowances are not taxable benefits if the employees derive no profit from the allowances, and the allowances are paid solely to reimburse expenditures that the employer has directed the employees incur. In the appellants' view, the amounts received from the Police Union served solely to reimburse them for the expenses that they incurred out of pocket in performing their union duties. And, in their submission, if they did not benefit from them, they should not have been taxed on the allowances paid by the Police Union (see also Bernier v. Québec (Sous‑ministre du Revenu), 2007 QCCA 1003, [2007] R.J.Q. 1519, [2007] Q.J. No. 7566 (QL).
[20] Lastly, counsel for the appellants argues that the tax-exempt status of the allowances for the use of a motor vehicle are not contingent on the travel expenses having been incurred outside the municipality where the employer's establishment at which the employee ordinarily worked or to which the employee ordinarily reported was located (subparagraph 6(1)(b)(vii.1) of the ITA).
The respondent's arguments
[21] The respondent argues that the appellants did in fact conduct their union business as office holders. She submits that the decision of the Federal