Duncan v. The Queen

Duncan v. The Queen
Court (s) Database
Tax Court of Canada Judgments
Date
2005-07-22
Neutral citation
2005 TCC 458
File numbers
97-986(IT)G
Judges and Taxing Officers
David W. Beaubier
Subjects
Income Tax Act
Decision Content
Docket: 97-986(IT)G
Citation No:2005TCC458
Date:20050722
BETWEEN:
JAMES S. DUNCAN,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent,
Docket: 97-988(IT)G
AND BETWEEN:
J. DUNCAN HOLDINGS LTD.,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
____________________________________________________________________
Motion heard by telephone conference call on July 19, 2005
By: The Honourable Justice D.W. Beaubier
Appearances:
Counsel for the Appellant:
George E.H. Cadman, Q.C.
Counsel for the Respondent:
S. Patricia Lee, Eric Noble,
Robert Carvalho and Gavin Laird
____________________________________________________________________
REASONS FOR ORDER AND ORDER
[1] Upon reading the material filed in these matters, reviewing the files and hearing counsel:
[2] These motions by the Respondent are requests for the Court to order James S. Duncan, upon examination for discoveries to answer questions "if a Section 754 election was made by Claridge & Associates?" or to provide counsel with that information. Appellants' counsel objected on the basis that it was a question of law.
[3] In the course of the examination a "Grant Thornton letter" dated March 15, 1988, addressed to CMF Enterprises Ltd. in Toronto was reviewed. This was a letter from Dallas, Texas, accountant Grant Thornton advising respecting this United States Internal Revenue Code election and the consequent United States tax and value results respecting it.
[4] CMF Enterprises Ltd. assigned the Appellants their interests in options to purchase interest in Claridge No. 1, apparently in 1987. Whether Claridge No. 1 was a partnership and the value and consideration for those purchases are parts of the subject in dispute.
[5] James S. Duncan was the general partner in Claridge Holdings No. 1, a partnership involved in the purchase and valuation for Canadian tax purposes of a condominium in Dallas, Texas, which values are the subject of these appeals.
[6] The questions are of factual matters, not law. In essence each set of questions is of the following:
James S. Duncan -
386: Was a Section 754 election made by Claridge & Associates?
387: Provide that information.
388: Was any debt forgiveness income attributable to Claridge Holdings No. 1?
389: Provide that information.
390: Were you willing to be subject to U.S. federal income tax on the Claridge transaction?
The questions of Mr. Duncan were identical in his examination for J. Duncan Holdings Ltd.
[7] Because Mr. Duncan was the general partner described, all of the questions were respecting matters within his power and ability to answer. They were factual and did not raise matters of legal knowledge. Each subject may be relevant to the value issues in dispute.
[8] James S. Duncan is ordered to answer the questions and to provide the information as asked.
[9] Costs and disbursements respecting each motion are fixed at $700 apiece and are to be paid to the Respondent by each Appellant forthwith.
[10] The examinations for discovery are ordered to be resumed at the expense of the Appellants.
Signed at Saskatoon, Saskatchewan, this 22nd day of July 2005.
"D.W. Beaubier"
Beaubier, J.
CITATION: 2005TCC458
COURT FILE NOS.: 97-986(IT)G and 97-988(IT)G
STYLE OF CAUSE: James S. Duncan, etal. v. The Queen
PLACE OF HEARING: Ottawa, Canada
DATE OF HEARING: July 19, 2005
ORDER AND REASONS FOR
ORDER BY: The Honourable Justice D.W. Beaubier
DATE OF ORDER AND
REASONS FOR ORDER: July 22, 2005
APPEARANCES:
For the Appellant:
George Cadman, Q.C.
Counsel for the Respondent:
Patricia Lee, Eric Noble, Robert Carvalho
and Gavin Laird
COUNSEL OF RECORD:
For the Appellant:
Name: George Cadman, Q.C.
Firm: Boughton Peterson Yang Anderson Law
Corporation
For the Respondent: John H. Sims, Q.C.
Deputy Attorney General of Canada
Ottawa, Ontario